UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number | 811-10533 | |||||||
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Reserve Municipal Money Market Trust | ||||||||
(Exact name of registrant as specified in charter) | ||||||||
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1250 Broadway, New York, NY |
| 10001-3701 | ||||||
(Address of principal executive offices) |
| (Zip code) | ||||||
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Christina M. Massaro 1250 Broadway, New York, NY 10001-3701 | ||||||||
(Name and address of agent for service) | ||||||||
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Registrant’s telephone number, including area code: | 212-401-5500 |
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Date of fiscal year end: | May 31 |
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Date of reporting period: | May 31, 2007 |
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Item 1. Annual Reports to Shareholders
Annual Report
May 31, 2007
Interstate Tax-Exempt Fund
California Municipal Money-Market Fund
(formerly California Tax-Exempt Fund)
Connecticut Municipal Money-Market Fund
(formerly Connecticut Tax-Exempt Fund)
Florida Municipal Money-Market Fund
(formerly Florida Tax-Exempt Fund)
Massachusetts Municipal Money-Market Fund
(formerly Massachusetts Tax-Exempt Fund)
Michigan Municipal Money-Market Fund
(formerly Michigan Tax-Exempt Fund)
New Jersey Municipal Money-Market Fund
(formerly New Jersey Tax-Exempt Fund)
Ohio Municipal Money-Market Fund
(formerly Ohio Tax-Exempt Fund)
Pennsylvania Municipal Money-Market Fund
(formerly Pennsylvania Tax-Exempt Fund)
Virginia Municipal Money-Market Fund
(formerly Virginia Tax-Exempt Fund)
of The Reserve Municipal Money-Market Trust II
(formerly The Reserve Tax-Exempt Trust)
New York Municipal Money-Market Fund
(formerly New York Tax-Exempt Fund)
of The Reserve New York Municipal Money-Market Trust
(formerly The Reserve New York Tax-Exempt Trust)
Arizona Municipal Money-Market Fund
Louisiana Municipal Money-Market Fund
Minnesota Municipal Money-Market Fund
of The Reserve Municipal Money-Market Trust
General Information and 24-Hour Yield and Balance Information
1250 Broadway, New York, NY 10001-3701 n 212-401-5500 n 800-637-1700 n www.TheR.com
This literature is not authorized for distribution to prospective investors unless preceded or accompanied by an appropriate current prospectus.
Distributor — Resrv Partners, Inc. RTET/ANNUAL 5/07
Bruce Bent
Chairman
The Reserve
May 31, 2007
Dear Investor,
The Federal Reserve Open Market Committee's tenor over the past year has been cautious and remained on "inflation alert" through its latest meetings. The yield on tax-exempt paper has been fairly stable, and our portfolios have done well in capturing opportunities on the very short end of the municipal yield curve.
The municipal markets in the latter half of 2006 and thus far in 2007 have been generally positive, and we have benefited from careful security selection and strategically structuring maturities that coincide with the municipal issuance calendar. Our portfolios have captured higher yields as interest rates moved up and remain highly competitive in the current stable interest rate environment. While we don't see an interest rate change in either direction for the tax-exempt markets, these securities may benefit from any correction in stocks, which are at all-time highs. We will continue our approach to careful security selection at quarter's end and into June when new issues in the municipal market will become available.
Thank you for choosing The Reserve and helping us become the fastest organically growing money fund company ranked among the top 25 largest U.S. money fund complexes in 2005 and 2006.* Please let us know your comments and suggestions as to how we can serve you better.
Bruce R. Bent
Chairman
*Ranked through September 30, 2006. Source: iMoneyNet, October 2006.
1
RESERVE MUNICIPAL MONEY-MARKET TRUST II—INTERSTATE TAX-EXEMPT FUND
SCHEDULE OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—99.9% | Value (Note 1) | |||||||||
| ARIZONA—9.0% | |||||||||||
| $ | 1,982,000 | Apache County IDA for Tucson Electric Power Co., 3.74%, 12/1/20(a) | $ | 1,982,000 | |||||||
| 35,757,000 | Apache County IDA for Tucson Electric Power Co., 3.74%, 12/15/18(a) | 35,757,000 | |||||||||
| 1,992,000 | Apache County IDA for Tucson Electric Power Co., 3.80%, 12/15/18(a) | 1,992,000 | |||||||||
| 3,379,000 | Arizona HCF for Royal Oaks Project, 3.75%, 3/1/27(a) | 3,379,000 | |||||||||
| 3,979,000 | Arizona HCF for Arizona Volunteer Hospital, Series B, 3.76%, 10/1/15(a) | 3,979,000 | |||||||||
| 129,000 | Coconino PCR for Arizona Public Services Co. Project, 3.92%, 11/1/33(a) | 129,000 | |||||||||
| 579,000 | Maricopa County IDA for Las Gardenias Apts., Series A, 3.80%, 4/15/33(a) | 579,000 | |||||||||
| 7,742,000 | McAllister Village for Arizona State University Project, 3.77%, 7/1/45(a)(b) | 7,742,000 | |||||||||
| 981,000 | Phoenix IDR for Del Mar Terrace, 3.75%, 10/1/29(a) | 981,000 | |||||||||
| 3,390,000 | Pima County IDR for Tucson Electric Power Co., Series 82-A, 3.80%, 12/1/22(a) | 3,390,000 | |||||||||
| 6,569,000 | Salt River Pima for Indian Community, 3.76%, 10/1/26(a) | 6,569,000 | |||||||||
| 5,000,000 | Scottsdale IDA for Healthcare, Series C, 3.75%, 9/1/35(a) | 5,000,000 | |||||||||
| 2,754,000 | Scottsdale IDA for Notre Dame School of Phoenix, 3.83%, 5/1/21(a)(b) | 2,754,000 | |||||||||
| 74,233,000 | |||||||||||
| CALIFORNIA—0.6% | |||||||||||
| 1,400,000 | California GO Bonds, Sub-Series A-1, 3.63%, 5/1/40(a) | 1,400,000 | |||||||||
| 1,000,000 | Fremont COP for Family Residence Center, Series 88, 3.70%, 8/1/30(a) | 1,000,000 | |||||||||
| 2,000,000 | Long Beach Harbor Revenue, Series A, 3.76%, 5/15/27(a) | 2,000,000 | |||||||||
| 500,000 | California PCR for Wadham Energy LP., 3.74%, 11/1/17(a) | 500,000 | |||||||||
| 4,900,000 | |||||||||||
| COLORADO—1.1% | |||||||||||
| 6,600,000 | Colorado ECFA for Bear Creek School Project, 3.75%, 10/1/32(a)(b) | 6,600,000 | |||||||||
| 2,800,000 | University of Colorado HRB, Series B, 3.76%, 11/15/35(a) | 2,800,000 | |||||||||
| 9,400,000 | |||||||||||
| CONNECTICUT—0.1% | |||||||||||
| 1,000,000 | Hartford Redevelopment Agency MHR for Underwood Towers Project, 3.74%, 6/1/20(a) | 1,000,000 | |||||||||
| 100,000 | Connecticut Special Tax Obligation for Transportation Infrastructure, Series 1, 3.80%, 9/1/20(a) | 100,000 | |||||||||
| 1,100,000 | |||||||||||
| FLORIDA—12.4% | |||||||||||
| 750,000 | Broward County EFA for City College Project, 3.75%,11/1/31(a)(b) | 750,000 | |||||||||
| 5,300,000 | Dade County IDA for Florida Water Service Revenue, 3.75%, 10/5/22(a) | 5,300,000 | |||||||||
| 400,000 | Duval County HFA for Lighthouse Bay Apartments, 3.76%, 12/1/32(a) | 400,000 | |||||||||
| 5,945,000 | Florida HFC Multifamily for Collins Cove Apartments-W, 3.81%, 2/1/36(a) | 5,945,000 | |||||||||
| 1,000,000 | Jacksonville District Energy System, Series A, 3.72%, 10/1/34(a) | 1,000,000 | |||||||||
| 36,000,000 | Miami-Dade County IDA for Airis Miami LLC, Series A, 3.80%, 10/15/25(a) | 36,000,000 | |||||||||
| 6,490,000 | Orlando & Orange County, Sub-Series A-2, 3.74%, 7/1/40(a) | 6,490,000 | |||||||||
| 6,000,000 | Palm Beach County for Morse Obligation Group, 3.78%, 5/1/33(a) | 6,000,000 | |||||||||
| 1,995,000 | Palm Beach County for Raymond F Kravis Center Project, 3.70%, 7/1/32(a) | 1,995,000 | |||||||||
| 13,035,000 | Palm Beach County for School Board, Series B, 3.75%, 8/1/27(a)(b) | 13,035,000 | |||||||||
| 2,725,000 | Port Orange for Palmer College Project, 3.78%, 10/1/32(a)(b) | 2,725,000 | |||||||||
| 500,000 | Sarasota County HFA for Bay Village, 3.78%, 12/1/23(a) | 500,000 | |||||||||
| 21,565,000 | USF Financing Corp. for College of Medicine Health, Series A-2, 3.76%, 7/1/36(a)(b) | 21,565,000 | |||||||||
| 101,705,000 | |||||||||||
See notes to financial statements.
2
RESERVE MUNICIPAL MONEY-MARKET TRUST II—INTERSTATE TAX-EXEMPT FUND
SCHEDULE OF NET ASSETS—MAY 31, 2007 (Continued)
| Principal Amount | TAX-EXEMPT OBLIGATIONS (Continued) | Value (Note 1) | |||||||||
| GEORGIA—1.3% | |||||||||||
| $ | 1,181,678 | Georgia Muni Association Pool Board COP, 3.77%, 12/15/20(a) | $ | 1,181,678 | |||||||
| 9,675,000 | Marietta MFH for Wood Glen, 3.76%, 7/1/24(a) | 9,675,000 | |||||||||
| 10,856,678 | |||||||||||
| ILLINOIS—1.4% | |||||||||||
| 11,800,000 | Chicago Water Revenue, Second Lien, 3.73%, 11/1/30(a) | 11,800,000 | |||||||||
| IOWA—0.1% | |||||||||||
| 1,000,000 | Des Moines HRB for Iowa Methodist Medical Center Project, 3.80%, 8/1/15(a) | 1,000,000 | |||||||||
| KENTUCKY—1.0% | |||||||||||
| 8,300,000 | Carroll County for North American Stainless Project, 3.85%, 1/1/31(a) | 8,300,000 | |||||||||
| LOUISIANA—6.8% | |||||||||||
| 560,000 | Lake Charles HRB & Term. District Revenue for CITGO Corp., 3.83%, 8/1/07(a) | 560,000 | |||||||||
| 560,000 | Louisiana Local Govt. Environment Facilities DAR, Series A, 3.78%, 11/1/34(a) | 560,000 | |||||||||
| 560,000 | Louisiana Local Govt. for Shreveport Utility System Project, 3.82%, 10/1/35(a) | 560,000 | |||||||||
| 5,000,000 | Louisiana Offshore Term. Auth. Deepwater Port Rev. for Loop LLC, Series A, 3.76%, 9/1/08(a) | 5,000,000 | |||||||||
| 90,000 | Louisiana PFA for Kenner Hotel Limited, 3.88%,12/1/15(a) | 90,000 | |||||||||
| 31,500,000 | Louisiana Port International Marine Term Project, Series A, 3.65%, 3/15/25 | 31,500,000 | |||||||||
| 930,000 | Louisiana State University A&M College Revenue, 3.77%, 7/1/30(a)(b) | 930,000 | |||||||||
| 2,260,000 | Port of New Orleans Cold Storage Project, 3.86%, 11/1/22(a) | 2,260,000 | |||||||||
| 8,970,000 | South Louisiana Port Marine Term. for Holnam Inc. Project , 3.86%, 1/1/27(a) | 8,970,000 | |||||||||
| 4,560,000 | South Louisiana Port Marine Term. for Occidental Petroleum Corp., 3.75%, 7/1/18(a) | 4,560,000 | |||||||||
| 985,000 | South Louisiana Port Marine Term. for Occidental Petroleum Corp., 3.80%, 7/1/21(a) | 985,000 | |||||||||
| 55,975,000 | |||||||||||
| MARYLAND—5.4% | |||||||||||
| 1,915,000 | Maryland Health & Higher Education for Trinity College, 3.83%, 11/1/26(a)(b) | 1,915,000 | |||||||||
| 16,415,000 | Maryland Health & Higher Education Pooled Loan, Series D, 3.75%, 1/1/29(a) | 16,415,000 | |||||||||
| 10,820,000 | Maryland HEFA for Adventist Health Care, Series A, 3.78%, 1/1/35(a) | 10,820,000 | |||||||||
| 9,200,000 | Maryland HEFA for Adventist Health Care, Series B, 3.78%, 1/1/21(a) | 9,200,000 | |||||||||
| 5,900,000 | Montgomery County for Riderwood Village Inc. Project, 3.79%, 3/1/34(a) | 5,900,000 | |||||||||
| 44,250,000 | |||||||||||
| MASSACHUSETTS—4.7% | |||||||||||
| 300,000 | Massachusetts DFA for Bedford Notre Dame Health Care, 3.87%, 10/1/29(a) | 300,000 | |||||||||
| 2,400,000 | Massachusetts DFA for Briarwood Retirement, Series A, 3.77%, 1/1/35(a) | 2,400,000 | |||||||||
| 4,715,000 | Massachusetts DFA for Brooksby Village Project, 3.75%, 7/1/32(a) | 4,715,000 | |||||||||
| 13,345,000 | Massachusetts DFA for Jewish Geriatric Services, 3.73%, 5/15/34(a) | 13,345,000 | |||||||||
| 8,225,000 | Massachusetts DFA for Salem Community Corp., 3.77%, 1/1/35(a) | 8,225,000 | |||||||||
| 1,900,000 | Massachusetts DFA IDR for You Incorporated, 3.74%, 9/1/32(a) | 1,900,000 | |||||||||
| 5,935,000 | Massachusetts HEFA for Single Family Housing, 3.78%, 12/1/30(a) | 5,935,000 | |||||||||
| 700,000 | Massachusetts WRA, Series 99B, 3.65%, 8/1/28(a) | 700,000 | |||||||||
| 550,000 | Massachusetts WRA, Series B, 3.80%, 8/1/37(a) | 550,000 | |||||||||
| 550,000 | Massachusetts WSR, General Series A, 3.72% 11/1/24(a) | 550,000 | |||||||||
| 38,620,000 | |||||||||||
| MICHIGAN—8.5% | |||||||||||
| 5,895,000 | Ann Arbor EDC for Glacier Hills Inc. Project, 3.75%,11/1/25(a) | 5,895,000 | |||||||||
| 20,000,000 | Detroit Sewer Disposal Second Lien GO Bond, Series E, 3.78%, 7/1/31 | 20,000,000 | |||||||||
| 8,245,000 | Green Lake EDA for Interlocken Center Project, 3.75%, 6/1/34(a) | 8,245,000 | |||||||||
See notes to financial statements.
3
RESERVE MUNICIPAL MONEY-MARKET TRUST II—INTERSTATE TAX-EXEMPT FUND
SCHEDULE OF NET ASSETS—MAY 31, 2007 (Continued)
| Principal Amount | TAX-EXEMPT OBLIGATIONS (Continued) | Value (Note 1) | |||||||||
| MICHIGAN (Continued) | |||||||||||
| $ | 400,000 | Jackson County EDC for Thrifty Leoni Inc. Project, 3.82%, 12/1/14(a) | $ | 400,000 | |||||||
| 2,700,000 | Michigan GO Bond, Series A, 4.25%, 9/28/07 | 2,705,067 | |||||||||
| 4,495,000 | Michigan MFH Revenue for Berrien Woods III, Series A, 3.86%, 7/1/32(a) | 4,495,000 | |||||||||
| 490,000 | Michigan MFH Revenue for River Place Apts., 3.83%, 6/1/18(a) | 490,000 | |||||||||
| 200,000 | Michigan HDA for Single Family Housing, Series 2000A, 3.80%, 12/1/16(a) | 200,000 | |||||||||
| 150,000 | Michigan HFA for Hospital Equipment Project, Series A, 3.74%, 12/1/23(a) | 150,000 | |||||||||
| 91,000 | Michigan Strategic Fund for Grayling General Solid Waste, 3.84%, 1/1/14(a) | 91,000 | |||||||||
| 2,335,000 | Michigan Strategic Fund for Metaltec Steel Abrasive, 3.84%, 8/1/31(a) | 2,335,000 | |||||||||
| 750,000 | Michigan Strategic Fund for Mot LLC Project, 3.78%, 12/1/34(a) | 750,000 | |||||||||
| 4,010,000 | Michigan Strategic Fund for Rest Haven Christian Services, 3.79%, 11/15/34(a) | 4,010,000 | |||||||||
| 490,000 | Milan Area Schools Unlimited GO Bond, 3.75%, 5/1/30(a)(b) | 490,000 | |||||||||
| 1,375,000 | Oakland University General Revenue, 3.80%, 3/1/31(a)(b) | 1,375,000 | |||||||||
| 18,315,000 | Wayne Charter County Michigan Airport Revenue, Series A, 3.85%, 12/1/16(a) | 18,315,000 | |||||||||
| 300,000 | WoodHaven Brownstown School District, Series B, 3.87%, 5/1/34(a)(b) | 300,000 | |||||||||
| 70,246,067 | |||||||||||
| MINNESOTA—3.6% | |||||||||||
| 20,000 | Cohasset for Minnesota Power and Light Project, Series B, 3.77%, 6/1/13(a) | 20,000 | |||||||||
| 40,000 | Minneapolis Revenue for People Serving People Project, 3.95%, 10/1/21(a) | 40,000 | |||||||||
| 2,065,000 | Minnesota Health for Fairview Health Services, 3.76%, 11/15/32(a) | 2,065,000 | |||||||||
| 22,475,000 | Minnesota HEFA for Carleton College, Series 6D, 3.72%, 4/1/35(a)(b) | 22,475,000 | |||||||||
| 1,412,000 | Minnesota HEFA for Residential Housing, Series C, 3.75%, 1/1/35(a) | 1,412,000 | |||||||||
| 1,990,000 | Minnesota HEFA for St. Olaf College, Series 5-H, 3.90%, 10/1/30(a)(b) | 1,990,000 | |||||||||
| 247,000 | Minnesota HEFA for St. Olaf College, Series 5-M1, 3.90%, 10/1/32(a)(b) | 247,000 | |||||||||
| 52,000 | St. Louis Park Reveune for Catholic Finance Corp., 3.79%, 10/1/25(a) | 52,000 | |||||||||
| 437,000 | St. Paul Housing & Redev. Authority MHR for Highland Ridge Project, 3.77%, 10/1/33(a) | 437,000 | |||||||||
| 747,000 | University of Minnesota Intermediate Term, Series A, 3.77%, 7/1/08(a)(b) | 747,000 | |||||||||
| 29,485,000 | |||||||||||
| MISSOURI—0.7% | |||||||||||
| 5,600,000 | Missouri Health Education SSM Health Care, Series C-3, 3.74%, 6/1/33(a) | 5,600,000 | |||||||||
| 155,000 | Platte County IDR for Platte Care Facility, 3.78%, 10/1/10(a) | 155,000 | |||||||||
| 5,755,000 | |||||||||||
| NEVADA—2.1% | |||||||||||
| 12,000,000 | Carson City for Tahoe Hospital Project, Series B, 3.75%, 9/1/33(a) | 12,000,000 | |||||||||
| 5,450,000 | Carson City HRB for Carson-Tahoe Regional Medical Center, 3.75%, 9/1/35(a) | 5,450,000 | |||||||||
| 17,450,000 | |||||||||||
| NEW JERSEY—0.2% | |||||||||||
| 985,000 | New Jersey EDA for Thermal Marina Energy LLC, 3.75%, 9/1/31(a) | 985,000 | |||||||||
| 685,000 | Salem County for Friends Home Woodstown Inc., 3.70%, 4/1/34(a) | 685,000 | |||||||||
| 1,670,000 | |||||||||||
| NEW YORK—17.7% | |||||||||||
| 980,000 | Babylon IDR for Ogden Martin, 3.69%, 1/1/19(a) | 980,000 | |||||||||
| 550,000 | Guilderland IDA for Eastern Industrial Park, Series 93-A, 3.72%, 12/1/08(a) | 550,000 | |||||||||
| 15,000,000 | Metropolitan Transit Authority, Sub-Series B, 3.65%, 6/13/07 | 15,000,000 | |||||||||
| 1,600,000 | Metropolitan Transit Authority, Sub-Series E-1, 3.75%, 11/1/35(a) | 1,600,000 | |||||||||
See notes to financial statements.
4
RESERVE MUNICIPAL MONEY-MARKET TRUST II—INTERSTATE TAX-EXEMPT FUND
SCHEDULE OF NET ASSETS—MAY 31, 2007 (Continued)
| Principal Amount | TAX-EXEMPT OBLIGATIONS (Continued) | Value (Note 1) | |||||||||
| NEW YORK (Continued) | |||||||||||
| $ | 700,000 | New York City Cultural Resources for Alvin Ailey Dance Foundation, 3.69%, 7/1/33(a) | $ | 700,000 | |||||||
| 18,585,000 | New York City GO Bond, Series A, 3.58%, 3/13/20(a) | 18,585,000 | |||||||||
| 5,695,000 | New York City GO Bond, Series H-2, 3.89%, 8/1/13(a) | 5,695,000 | |||||||||
| 1,200,000 | New York City MFH for Brookhaven Apartments, Series A, 3.76%, 1/1/36(a) | 1,200,000 | |||||||||
| 4,400,000 | New York City GO, Series C4, 3.68%, 8/1/20(a) | 4,400,000 | |||||||||
| 2,000,000 | New York State Con Edison Research and Development, Sub-Series C-2, 3.75%, 11/1/39(a) | 2,000,000 | |||||||||
| 1,500,000 | New York State HFA for 10 Liberty Street, 3.70%, 5/1/35(a) | 1,500,000 | |||||||||
| 6,500,000 | New York State MFH for Avalon Bowery Place, 3.84%, 11/1/39(a) | 6,500,000 | |||||||||
| 425,000 | New York State HFA for Bleecker Terrace Apt. Project, Series 85, 3.85%, 7/1/15(a) | 425,000 | |||||||||
| 5,000,000 | New York State HFA for Victory Housing, Series 2004-A, 3.83%, 11/1/33(a) | 5,000,000 | |||||||||
| 900,000 | New York State HFA for 350 West 43rd Street Housing, 3.88%, 11/1/34(a) | 900,000 | |||||||||
| 23,600,000 | New York State HFA for Worth Street Market, 3.83%, 5/15/33(a) | 23,600,000 | |||||||||
| 4,800,000 | New York State HFA, Series B, 3.78%, 3/15/26(a) | 4,800,000 | |||||||||
| 4,100,000 | New York State IDA for Civil American Society, 3.69%, 10/1/33(a) | 4,100,000 | |||||||||
| 39,000,000 | New York State Local Assistance, Series B, 3.67%, 4/1/23(a) | 39,000,000 | |||||||||
| 2,500,000 | New York State LGAC, Series D, 3.77%, 4/1/25(a) | 2,500,000 | |||||||||
| 825,000 | Rotterdam IDA for Industrial Park Project, Series A, 3.72%, 11/1/09(a) | 825,000 | |||||||||
| 3,610,000 | Schenectady County IDA for Sunnyview Hospital and Rehab., Series A, 3.79%, 8/1/33(a) | 3,610,000 | |||||||||
| 2,505,000 | Westchester IDA for Catherine Field Home, 3.76%, 1/1/31(a) | 2,505,000 | |||||||||
| 145,975,000 | |||||||||||
| NORTH CAROLINA—0.2% | |||||||||||
| 600,000 | North Carolina EFA for Cardinal Gibbons, 3.76%, 8/1/14(a) | 600,000 | |||||||||
| 800,000 | North Carolina Medical Care Community HCF for Stanley Total Living Center, 3.83%, 4/1/18(a) | 800,000 | |||||||||
| 1,400,000 | |||||||||||
| OHIO—6.7% | |||||||||||
| 5,000,000 | Akron Bath Copley HDR for Summa Health System, Series B, 3.79%, 11/1/34(a) | 5,000,000 | |||||||||
| 550,000 | Butler County HCF for Lifesphere Project, 3.80%, 5/1/27(a) | 550,000 | |||||||||
| 12,100,000 | Clinton County for Wilmington Airport Inc., 3.81%, 6/1/11(a) | 12,100,000 | |||||||||
| 3,000,000 | Cuyahoga County for Cleveland Health Education Museum, 3.79%, 3/1/32(a) | 3,000,000 | |||||||||
| 1,300,000 | Cuyahoga County HCF for Devon Oaks Project, 3.77%, 2/1/34(a) | 1,300,000 | |||||||||
| 3,000,000 | Cuyahoga County HRB EDA for Cleveland Botanical Gardens, 3.79%, 7/1/31(a) | 3,000,000 | |||||||||
| 7,000,000 | Evandale County IDR for SHV Realty Inc., 3.85%, 9/1/15(a) | 7,000,000 | |||||||||
| 2,635,000 | Franklin County HRB for U.S. Health Corp., Series 96 A, 3.75%, 12/1/21(a) | 2,635,000 | |||||||||
| 270,000 | Franklin County HRB for U.S. Health Corp., Series B, 3.75%, 12/1/20(a) | 270,000 | |||||||||
| 2,650,000 | Hamilton County HCF for Episcopal, Series B, 3.75%, 6/1/35(a) | 2,650,000 | |||||||||
| 785,000 | Kent State University Receipts, 3.77%, 5/1/31(a)(b) | 785,000 | |||||||||
| 4,700,000 | Licking County HCF for Kendal at Granville, 3.76%, 11/1/33(a) | 4,700,000 | |||||||||
| 860,000 | Middleburgh Heights for Southwest General Hospital, 3.78%, 8/15/22(a) | 860,000 | |||||||||
| 100,000 | Ohio Air Quality DAR for Ohio Edison, Series A, 3.73%, 2/1/14(a) | 100,000 | |||||||||
| 410,000 | Ohio State HEFA for Ashland University Project, 3.81%, 9/1/24(a)(b) | 410,000 | |||||||||
| 11,050,000 | Toledo-Lucas County Port Authority, Series C, 3.75%, 5/15/38(a) | 11,050,000 | |||||||||
| 55,410,000 | |||||||||||
| OREGON—0.1% | |||||||||||
| 500,000 | Portland MFH for South Park Project, 3.80%, 12/1/11(a) | 500,000 | |||||||||
See notes to financial statements.
5
RESERVE MUNICIPAL MONEY-MARKET TRUST II—INTERSTATE TAX-EXEMPT FUND
SCHEDULE OF NET ASSETS—MAY 31, 2007 (Continued)
| Principal Amount | TAX-EXEMPT OBLIGATIONS (Continued) | Value (Note 1) | |||||||||
| PENNSYLVANIA—10.9% | |||||||||||
| $ | 6,900,000 | Beaver County IDA for Firstenergy Nuclear Generator, 3.81%,1/1/35(a) | $ | 6,900,000 | |||||||
| 100,000 | City of Philadelphia WSR Refund, 3.75%, 6/15/23(a) | 100,000 | |||||||||
| 18,400,000 | Cumberland County for Asbury Group, 3.78%, 1/1/41(a) | 18,400,000 | |||||||||
| 4,500,000 | Cumberland County for Presbyterian Homes Inc., 3.75%, 12/1/32(a) | 4,500,000 | |||||||||
| 3,100,000 | Delaware County IDR for Sun Inc., 3.78%, 11/1/33(a) | 3,100,000 | |||||||||
| 9,200,000 | Emmaus General Authority Revenue, Sub-Series G-18, 3.83%, 3/1/24(a) | 9,200,000 | |||||||||
| 1,000,000 | Manheim Township School District, 3.77%, 6/1/25(a)(b) | 1,000,000 | |||||||||
| 3,990,000 | Manheim Township School District GO Bond, 3.77%, 5/1/23(a)(b) | 3,990,000 | |||||||||
| 3,400,000 | Montgomery County Higher Ed. For William Penn Charter, 3.78%, 9/15/31(a) | 3,400,000 | |||||||||
| 3,400,000 | Montgomery County MFH for Kingswood Apartments, Series A, 3.72%, 8/15/31(a) | 3,400,000 | |||||||||
| 2,040,000 | North Hampton County First Mortgage of Kirkland Village, 3.75%, 11/1/30(a) | 2,040,000 | |||||||||
| 3,195,000 | Pennsylvania Energy Development Authority for Ebensburg Project 3.80%, 12/1/11(a) | 3,195,000 | |||||||||
| 1,000,000 | Pennsylvania HEFA for Association of Independent Colleges, Series E3, 3.75%, 11/1/14(a)(b) | 1,000,000 | |||||||||
| 300,000 | Pennsylvania State Turnpike Commission, Series A-3, 3.81%, 12/1/30(a) | 300,000 | |||||||||
| 11,425,000 | Quakertown General Authority Revenue, Series A, 3.77%, 7/1/26(a) | 11,425,000 | |||||||||
| 1,000,000 | Lampeter Strasburg for School District, Series A, 3.78%, 6/1/19(a)(b) | 1,000,000 | |||||||||
| 1,450,000 | Washington County for University of Pennsylvania, 3.80%, 7/1/34(a)(b) | 1,450,000 | |||||||||
| 13,905,000 | Westmoreland County IDA for Redstone Highlands Apartments, 3.77%, 1/1/36(a) | 13,905,000 | |||||||||
| 1,585,000 | Wilkins Area IDA for Fairview Extended Care, Series B, 3.72%, 1/1/21(a) | 1,585,000 | |||||||||
| 89,890,000 | |||||||||||
| PUERTO RICO—0.1% | |||||||||||
| 508,000 | Puerto Rico Government Development Bank, 3.61%, 12/1/15(a) | 508,000 | |||||||||
| 115,000 | Puerto Rico Highway & Transportation Authority, Series A, 3.63%, 7/1/28(a) | 115,000 | |||||||||
| 623,000 | |||||||||||
| TENNESSEE—0.1% | |||||||||||
| 495,000 | Chattanooga HEFA for Baylor School Project, Series 96, 3.76%, 11/1/16(a)(b) | 495,000 | |||||||||
| TEXAS—3.6% | |||||||||||
| 3,700,000 | Harris County IDA for Baytank Houston Inc. Project, 3.81%, 2/1/20(a) | 3,700,000 | |||||||||
| 8,300,000 | North Texas Higher Education Authority for Student Loan Revenue, Series A, 3.80%, 12/1/38(a) | 8,300,000 | |||||||||
| 18,000,000 | Travis County HFA for Querencia Barton Creek, Series C, 3.75%, 11/15/35(a) | 18,000,000 | |||||||||
| 30,000,000 | |||||||||||
| VIRGINIA—1.5% | |||||||||||
| 140,000 | Chesapeake County IDA for Chesapeake General Hospital, Series B, 3.76%, 7/1/31(a) | 140,000 | |||||||||
| 767,000 | Fairfax County EDA for Smithsonian Institute, 3.75%, 12/1/33(a) | 767,000 | |||||||||
| 100,000 | Henrico County EDA for White Oaks Ltd Project, 3.84%, 10/1/27(a) | 100,000 | |||||||||
| 1,745,000 | King George County for Garnet of VA Inc. Project, 3.81%, 9/1/21(a) | 1,745,000 | |||||||||
| 1,100,000 | Portsmouth MFH for Marsh Landing Project, Series A, 3.81%, 6/1/30(a) | 1,100,000 | |||||||||
| 8,405,000 | University of Virginia General Revenue, Series A, 3.77%, 6/1/34(a)(b) | 8,405,000 | |||||||||
| 12,257,000 | |||||||||||
See notes to financial statements.
6
RESERVE MUNICIPAL MONEY-MARKET TRUST II—INTERSTATE TAX-EXEMPT FUND
SCHEDULE OF NET ASSETS—MAY 31, 2007 (Continued)
| TAX-EXEMPT OBLIGATIONS (Continued) | Value (Note 1) | ||||||||||
| Total Investments (Cost* $823,295,745) | 99.9 | % | $ | 823,295,745 | |||||||
| Comprehensive management fees payable | 0.0 | ^ | (10,242 | ) | |||||||
| Distribution(12b-1) fees payable | 0.0 | ^ | (1,828 | ) | |||||||
| Other Assets less Liabilities | 0.1 | 460,977 | |||||||||
| Net Assets | 100.0 | % | $ | 823,744,652 | |||||||
| Net asset value, offering and redemption price per share, based on shares of beneficial interest, $.001 par value outstanding and equivalent to the Net Assets of each class: | |||||||||||
| 350,444,945 shares Class Institutional | $ | 1.00 | |||||||||
| 319,577,753 shares Class R | $ | 1.00 | |||||||||
| 8,996,107 shares Class 70 | $ | 1.00 | |||||||||
| 5,096,263 shares Class 75 | $ | 1.00 | |||||||||
| 476,411 shares Class 45 | $ | 1.00 | |||||||||
| 109,305 shares Class 15 | $ | 1.00 | |||||||||
| 96,726,180 shares Class Treasurer's Trust | $ | 1.00 | |||||||||
| 42,345,474 shares Class 25 | $ | 1.00 | |||||||||
See notes to financial statements.
7
RESERVE MUNICIPAL MONEY-MARKET TRUST II—CALIFORNIA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—99.4% | Value (Note 1) | |||||||||
| CALIFORNIA—99.4% | |||||||||||
| $ | 395,000 | Alameda Contra Costa COP, Series F, 3.73%, 8/1/23(a) | $ | 395,000 | |||||||
| 5,000,000 | California Finance Authority for Elder Care Alliance, Series A, 3.71%, 11/1/36(a) | 5,000,000 | |||||||||
| 7,950,000 | California GO Bonds, Sub-Series A-1, 3.63%, 5/1/40(a) | 7,950,000 | |||||||||
| 5,155,000 | California HFA Revenue, Series P, 3.80%, 2/1/27(a) | 5,155,000 | |||||||||
| 3,640,000 | California Infrastructure & Economic Development, Series A, 3.72%, 9/1/28(a) | 3,640,000 | |||||||||
| 7,295,000 | California PCR for Pacific Gas & Electric Finance, 3.82%, 11/1/26(a) | 7,295,000 | |||||||||
| 2,500,000 | California PCR for Wadham Energy LP, 3.74%, 11/1/17(a) | 2,500,000 | |||||||||
| 670,000 | California School Facilities for Capital Improvements, Series COP, 3.65%, 7/1/22(a)(b) | 670,000 | |||||||||
| 400,000 | California State Water Reserve Power Supply Revenue, 3.81%, 5/1/22(a) | 400,000 | |||||||||
| 5,140,000 | California State Water Reserve Power Supply Revenue, 3.70%, 5/1/22(a) | 5,140,000 | |||||||||
| 6,200,000 | California State Water Reserve Power Supply Revenue, 3.85%, 5/1/22(a) | 6,200,000 | |||||||||
| 1,150,000 | California State Water Reserve Power Supply Revenue, Series B-3, 3.75%, 5/1/22(a) | 1,150,000 | |||||||||
| 1,300,000 | California State Water Reserve Power Supply Revenue, Sub-Series C-13, 3.67%, 5/1/22(a) | 1,300,000 | |||||||||
| 4,800,000 | California State Water Reserve Power Supply Revenue, Sub-Series G-10, 3.70%, 5/1/18(a) | 4,800,000 | |||||||||
| 6,000,000 | California State Water Reserve Power Supply Revenue, Sub-Series G-7, 3.63%, 5/1/17(a) | 6,000,000 | |||||||||
| 6,400,000 | California Statewide CDA for Covenant Retirement Community, 3.68%, 12/1/25(a) | 6,400,000 | |||||||||
| 2,200,000 | California Statewide CDA for Early Education Community Center COP, 3.72%, 9/1/31(a) | 2,200,000 | |||||||||
| 2,175,000 | Chula Vista Charter City for Home Depot Project Inc., 3.61%, 12/1/10(a) | 2,175,000 | |||||||||
| 5,000,000 | Dublin MFH for Park Sierra, Series A, 3.75%, 6/1/28(a) | 5,000,000 | |||||||||
| 1,400,000 | Fremont Public Finance Family Reserve Center, Series 98, 3.70%, 8/1/28(a) | 1,400,000 | |||||||||
| 432,000 | Irvine Assessment LTD Obligation Improvement Bonds District 87-8, 3.83%, 9/2/24(a) | 432,000 | |||||||||
| 8,445,000 | Irvine Improvement Bond Assessment District 89-10, 3.85%, 9/2/15(a) | 8,445,000 | |||||||||
| 2,050,000 | Irvine Improvement Bond Assessment District 94-13, 3.81%, 9/2/22(a) | 2,050,000 | |||||||||
| 3,100,000 | Long Beach Harbor Revenue, Series A, 3.76%, 5/15/27(a) | 3,100,000 | |||||||||
| 3,400,000 | Los Angeles Community Redev Multifamily 2nd & Central Apartments Project-A, 3.68%, 12/1/38(a) | 3,400,000 | |||||||||
| 3,700,000 | Los Angeles Community Security Building Project, 3.73%, 12/15/34(a) | 3,700,000 | |||||||||
| 5,000,000 | Los Angeles MFH for Grand Promenade Project, 3.68%, 4/1/32(a) | 5,000,000 | |||||||||
| 1,300,000 | Metro Water District Southern California Waterworks Revenue, Series B-2, 3.70%, 7/1/28(a) | 1,300,000 | |||||||||
| 7,000,000 | Metro Water District Southern California Waterworks Revenue, Series C-2, 3.84%, 7/1/36(a) | 7,000,000 | |||||||||
| 4,150,000 | Orange County Sanitation Authority, 3.63%, 8/1/13(a) | 4,150,000 | |||||||||
| 2,475,000 | Riverside County Facilities District # 88-4 Community, 3.66%, 9/1/14(a) | 2,475,000 | |||||||||
| 4,000,000 | San Francisco Community Facilities District # 4, 3.72%, 8/1/31(a) | 4,000,000 | |||||||||
| 1,300,000 | Santa Ana County Unified School District, 3.75%, 7/1/15(a)(b) | 1,300,000 | |||||||||
| 5,000,000 | Santa Clara County El Cammo Hospital District, 3.79%, 8/1/15(a) | 5,000,000 | |||||||||
| 3,600,000 | Stockton HCF for Dameron Hospital Association, Series A, 3.83%, 12/1/32(a) | 3,600,000 | |||||||||
| 3,065,000 | Turlock Irrigation District for Transportation Project, Series A, 3.80%, 1/1/31(a) | 3,065,000 | |||||||||
| 132,787,000 | |||||||||||
| Total Investments (Cost* $132,787,000) | 99.4 | % | 132,787,000 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (2,927 | ) | |||||||
| Distribution(12b-1) fees payable | 0.0 | ^ | (732 | ) | |||||||
| Other Assets less Liabilities | 0.6 | 756,235 | |||||||||
| Net Assets | 100.0 | % | $ | 133,539,576 | |||||||
| Net asset value, offering and redemption price per share, based on 133,539,576 shares of beneficial interest, $.001 par value outstanding, Class R | $ | 1.00 | |||||||||
See notes to financial statements.
8
RESERVE MUNICIPAL MONEY-MARKET TRUST II—CONNECTICUT MUNICIPAL MONEY-MARKET FUND
SCHEDULE OF INVESTMENTS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—88.7% | Value (Note 1) | |||||||||
| CONNECTICUT—82.1% | |||||||||||
| $ | 2,245,000 | Connecticut DAR for Independent Living Project, 3.80%, 7/1/15(a) | $ | 2,245,000 | |||||||
| 2,725,000 | Connecticut DAR for Pierce Memorial Baptist, 3.70%, 10/1/28(a) | 2,725,000 | |||||||||
| 4,100,000 | Connecticut DAR for Solid Waste, 3.79%, 8/1/23(a) | 4,100,000 | |||||||||
| 2,555,000 | Connecticut GO, Series 1-A, 3.80%, 2/15/21(a) | 2,555,000 | |||||||||
| 2,360,000 | Connecticut GO, Series 97-B, 3.70%, 5/15/14(a) | 2,360,000 | |||||||||
| 4,000,000 | Connecticut HEFA for Hotchkiss School, Series A, 3.77%, 7/1/30(a)(b) | 4,000,000 | |||||||||
| 1,000,000 | Connecticut HEFA for Kingswood-Oxford School, 3.77%, 7/1/30(a)(b) | 1,000,000 | |||||||||
| 1,100,000 | Connecticut HEFA for Klingberg Family Center, 3.74%, 7/1/32(a)(b) | 1,100,000 | |||||||||
| 400,000 | Connecticut HEFA for Yale University, Series T-2, 3.66%, 7/1/29(a)(b) | 400,000 | |||||||||
| 500,000 | Connecticut HEFA for Yale University, Series V-1, 3.90%, 7/1/36(a)(b) | 500,000 | |||||||||
| 1,100,000 | Connecticut HEFA for Yale University, Series V-2, 3.90%, 7/1/36(a)(b) | 1,100,000 | |||||||||
| 3,500,000 | Connecticut HEFA for Yale University, Series X-3, 3.90%, 7/1/37(a)(b) | 3,500,000 | |||||||||
| 3,600,000 | Connecticut HFA, Sub-Series D-3, 3.75%, 5/15/33(a) | 3,600,000 | |||||||||
| 3,600,000 | Connecticut Special Tax Obligation for Transportation Infrastructure, Series 1, 3.80%, 9/1/20(a) | 3,600,000 | |||||||||
| 2,010,000 | Hartford MHR for Underwood Towers Project, 3.74%, 6/1/20(a) | 2,010,000 | |||||||||
| 1,915,000 | New Canaan Housing Authority for Village at Waveny Care Center, 3.73%, 1/1/22(a) | 1,915,000 | |||||||||
| 1,515,000 | Shelton County HFA for Crosby Commons Project, 3.85%, 1/1/31(a) | 1,515,000 | |||||||||
| 38,225,000 | |||||||||||
| PUERTO RICO—6.6% | |||||||||||
| 2,300,000 | Puerto Rico Government Development Bank, 3.61%, 12/1/15(a) | 2,300,000 | |||||||||
| 800,000 | Puerto Rico Highway & Transportation Authority, 3.63%,7/1/28(a) | 800,000 | |||||||||
| 3,100,000 | |||||||||||
| Total Investments (Cost* $41,325,000) | 88.7 | % | 41,325,000 | ||||||||
| Other Assets less Liabilities | 11.3 | 5,253,137 | |||||||||
| Net Assets | 100.0 | % | $ | 46,578,137 | |||||||
RESERVE MUNICIPAL MONEY-MARKET TRUST II—CONNECTICUT MUNICIPAL MONEY-MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES
MAY 31, 2007
| Assets | |||||||
| Investments in securities, at value (Cost $41,325,000) | $ | 41,325,000 | |||||
| Cash | 5,131,721 | ||||||
| Interest receivable | 143,174 | ||||||
| Total Assets | 46,599,895 | ||||||
| Liabilities | |||||||
| Comprehensive management fees payable | 7,117 | ||||||
| Distribution (12b-1) fees payable | 1,779 | ||||||
| Accrued Interest Payable | 12,783 | ||||||
| Other Liabilities | 79 | ||||||
| Total Liabilities | 21,758 | ||||||
| Net Assets | $ | 46,578,137 | |||||
| Net asset value, offering and redemption price per share, based on 46,578,137 shares of beneficial interest, $.001 par value outstanding, Class R | $ | 1.00 | |||||
See notes to financial statements.
9
RESERVE MUNICIPAL MONEY-MARKET TRUST II—FLORIDA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—96.2% | Value (Note 1) | |||||||||
| FLORIDA—94.7% | |||||||||||
| $ | 5,340,000 | Alachua County HFA for Oak Hammock University Project, Series A, 3.90%, 10/1/32(a)(b) | $ | 5,340,000 | |||||||
| 1,250,000 | Broward County EFA for City College Project, 3.75%, 11/1/31(a)(b) | 1,250,000 | |||||||||
| 1,835,000 | Broward County HFA for Jacaranda Village Apartments, 3.77%, 9/1/22(a) | 1,835,000 | |||||||||
| 1,000,000 | Collier County for Cleveland Health Clinic, Series C-1, 3.87%, 1/1/35(a) | 1,000,000 | |||||||||
| 1,770,000 | Dade County IDA for Dolphins Stadium, Series B, 3.70%, 1/1/16(a) | 1,770,000 | |||||||||
| 400,000 | Dade County IDA for Dolphins Stadium, Series C, 3.70%, 1/1/16(a) | 400,000 | |||||||||
| 750,000 | Dade County IDA for Dolphins Stadium, Series D, 3.70%, 1/1/16(a) | 750,000 | |||||||||
| 5,500,000 | Dade County IDA for Florida Water Service Revenue, 3.75%, 10/5/22(a) | 5,500,000 | |||||||||
| 2,500,000 | Duval County HFA for Lighthouse Bay Apartments, 3.76%, 12/1/32(a) | 2,500,000 | |||||||||
| 1,225,000 | Florida HEFA for St Thomas University Project, 3.89%, 1/1/19(a)(b) | 1,225,000 | |||||||||
| 1,645,000 | Florida HFC Multifamily for Bridgewater Club, Series L-1, 3.81%, 6/1/34(a) | 1,645,000 | |||||||||
| 4,400,000 | Florida HFC Multifamily for Wellesley Apartments, Series O, 3.81% , 8/1/35(a) | 4,400,000 | |||||||||
| 1,000,000 | Greater Orlando Aviation Authority, Series E, 3.80%, 10/1/21(a) | 1,000,000 | |||||||||
| 2,000,000 | Hillsborough County for Carrollwood Day School Project, 3.76%, 6/1/31(a)(b) | 2,000,000 | |||||||||
| 4,880,000 | Jacksonville District Energy System, Series A, 3.72%, 10/1/34(a) | 4,880,000 | |||||||||
| 2,290,000 | Jacksonville HFA for Southern Baptist Hospital, Series A, 3.89%, 8/15/33(a) | 2,290,000 | |||||||||
| 2,400,000 | Manatee County PCR for Florida Power & Light, 3.89%, 9/1/24(a) | 2,400,000 | |||||||||
| 1,600,000 | Miami-Dade County IDA for Airis Miami LLC, Series A, 3.80%, 10/15/25(a) | 1,600,000 | |||||||||
| 2,065,000 | Orange County IDA for Central YMCA Project, Series A, 3.78%, 5/1/27(a) | 2,065,000 | |||||||||
| 3,500,000 | Orlando & Orange County, Sub-Series A-2, 3.74%, 7/1/40(a) | 3,500,000 | |||||||||
| 3,800,000 | Palm Beach County for Morse Obligation Group, 3.78%, 5/1/33(a) | 3,800,000 | |||||||||
| 3,900,000 | Palm Beach County for Raymond F Kravis Center Project, 3.70%, 7/1/32(a) | 3,900,000 | |||||||||
| 2,370,000 | Palm Beach County for School Board, Series B, 3.75%, 8/1/27(a)(b) | 2,370,000 | |||||||||
| 300,000 | Pinellas County for Foxbridge Apartments, Series A, 3.80%, 6/15/25(a) | 300,000 | |||||||||
| 500,000 | Pinellas County HFA for Pooled Hospital Loan Program, Series 85, 3.90%, 12/1/15(a) | 500,000 | |||||||||
| 900,000 | Pinellas County HFA, 3.83%, 11/1/15(a) | 900,000 | |||||||||
| 5,275,000 | Port Orange for Palmer College Project, 3.78%, 10/1/32(a)(b) | 5,275,000 | |||||||||
| 280,000 | Sarasota County HCF for Bay Village, 3.78%, 12/1/23(a) | 280,000 | |||||||||
| 200,000 | Seminole County IDA HCF for Florida Living Nursing, 3.96%, 2/1/11(a) | 200,000 | |||||||||
| 2,000,000 | University of North Florida Capital Improvements Project, 3.80%, 11/1/24(a)(b) | 2,000,000 | |||||||||
| 2,100,000 | USF Financing Corp for College of Medicine Health, Series A-2, 3.76%, 7/1/36(a)(b) | 2,100,000 | |||||||||
| 700,000 | Volusia County IDR for Easter Seal Society of Volusia, 3.88%, 9/1/21(a) | 700,000 | |||||||||
| 69,675,000 | |||||||||||
| PUERTO RICO—1.5% | |||||||||||
| 1,097,000 | Puerto Rico Government Development Bank, 3.61%, 12/1/15(a) | 1,097,000 | |||||||||
| Total Investments (Cost* $70,772,000) | 96.2 | % | 70,772,000 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (11,049 | ) | |||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (2,762 | ) | |||||||
| Other Assets less Liabilities | 3.8 | 2,837,494 | |||||||||
| Net Assets | 100.0 | % | $ | 73,595,683 | |||||||
| Net asset value, offering and redemption price per share, based on 73,595,683 shares of beneficial interest, $.001 par value outstanding, Class R | $ | 1.00 | |||||||||
See notes to financial statements.
10
RESERVE MUNICIPAL MONEY-MARKET TRUST II—MASSACHUSETTS MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—96.6% | Value (Note 1) | |||||||||
| MASSACHUSETTS—96.6% | |||||||||||
| $ | 2,090,000 | Massachusetts DFA for Bedford Notre Dame Health Care, 3.87%, 10/1/29(a) | $ | 2,090,000 | |||||||
| 2,185,000 | Massachusetts DFA for Brooksby Village Project, 3.75%, 7/1/32(a) | 2,185,000 | |||||||||
| 900,000 | Massachusetts DFA for Gann Academy Project, 3.76%, 6/1/32(a) | 900,000 | |||||||||
| 1,050,000 | Massachusetts DFA for Jewish Geriatric Services, 3.73%, 5/15/34(a) | 1,050,000 | |||||||||
| 625,000 | Massachusetts DFA for Mystic Valley School, 3.76%, 6/15/08(a)(b) | 625,000 | |||||||||
| 1,000,000 | Massachusetts DFA for Salem Community Corp., 3.77%, 1/1/35(a) | 1,000,000 | |||||||||
| 198,000 | Massachusetts DFA for Smith College, 3.70%, 7/1/29(a)(b) | 198,000 | |||||||||
| 1,220,000 | Massachusetts DFA for Smith College, 3.70%, 7/1/24(a)(b) | 1,220,000 | |||||||||
| 800,000 | Massachusetts DFA IDR for Ocean Spray Cranberries, 3.82%, 10/15/11(a) | 800,000 | |||||||||
| 400,000 | Massachusetts DFA IDR for You Incorporated, 3.74%, 9/1/32(a) | 400,000 | |||||||||
| 200,000 | Massachusetts GO for Central Artery, Series B, 3.90%, 12/1/30(a) | 200,000 | |||||||||
| 600,000 | Massachusetts GO, Series 97-B, 3.75%, 9/1/16(a) | 600,000 | |||||||||
| 800,000 | Massachusetts HEFA for Berklee College of Music, Series B, 3.67%, 10/1/27(a)(b) | 800,000 | |||||||||
| 600,000 | Massachusetts HEFA for Cap Asset Program, Series D, 3.88%, 1/1/35(a)(b) | 600,000 | |||||||||
| 1,600,000 | Massachusetts HEFA for Cap Asset Program, Series E, 3.86%, 1/1/35(a)(b) | 1,600,000 | |||||||||
| 275,000 | Massachusetts HEFA for Harvard University, Series Y, 3.66%, 7/1/35(a)(b) | 275,000 | |||||||||
| 880,000 | Massachusetts HEFA for MIT, Series J-2, 3.70%, 7/1/31(a)(b) | 880,000 | |||||||||
| 1,650,000 | Massachusetts HEFA for Single Family Housing, 3.78%, 12/1/30(a)(b) | 1,650,000 | |||||||||
| 1,400,000 | Massachusetts HEFA for Wellesley College, Series E, 3.73%, 7/1/22(a)(b) | 1,400,000 | |||||||||
| 800,000 | Massachusetts HEFA for Williams College, Series E, 3.75%, 8/1/14(a)(b) | 800,000 | |||||||||
| 520,000 | Massachusetts IFA for Lowell Mills Associates LP, Series 95, 3.86%, 12/1/20(a) | 520,000 | |||||||||
| 600,000 | Massachusetts IFA for Tech Mold & Tool, 3.83%, 6/1/18(a) | 600,000 | |||||||||
| 930,000 | Massachusetts WRA, Sub-Series B, 3.80%, 4/1/28(a) | 930,000 | |||||||||
| 1,100,000 | Massachusetts WRA, Sub-Series C, 3.80%, 8/1/37(a) | 1,100,000 | |||||||||
| 1,010,000 | Massachusetts WRA, Sub-Series C, 3.95%, 8/1/20(a) | 1,010,000 | |||||||||
| 150,000 | Massachusetts WSR, General Series A, 3.72% 11/1/24(a) | 150,000 | |||||||||
| 23,583,000 | |||||||||||
| Total Investments (Cost* $23,583,000) | 96.6 | % | 23,583,000 | ||||||||||||
| Comprehensive management fees payable | 0.0 | ^ | (3,701 | ) | |||||||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (925 | ) | |||||||||||
| Other Assets less Liabilities | 3.4 | 824,906 | |||||||||||||
| Net Assets | 100.0 | % | $ | 24,403,280 | |||||||||||
| Net asset value, offering and redemption price per share, based on 24,403,280 shares of beneficial interest, $.001 par value outstanding, Class R | $1.00 | ||||||||||||||
See notes to financial statements.
11
RESERVE MUNICIPAL MONEY-MARKET TRUST II—MICHIGAN MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—98.7% | Value (Note 1) | |||||||||
| MICHIGAN—97.7% | |||||||||||
| $ | 400,000 | Ann Arbor EDC for Glacier Hills Inc Project, 3.75%, 11/1/25(a) | $ | 400,000 | |||||||
| 100,000 | Detroit Economic Water Front, Series A, 3.76%, 5/1/09(a) | 100,000 | |||||||||
| 800,000 | Detroit Sewer Disposal Revenue, Series B, 3.90%, 7/1/33(a) | 800,000 | |||||||||
| 500,000 | Grand Rapids EDC for Baker Knapp & Tubbs, 3.83%, 6/1/12(a) | 500,000 | |||||||||
| 300,000 | Green Lake EDA for Interlocken Center Project, 3.75%, 6/1/34(a) | 300,000 | |||||||||
| 1,100,000 | Jackson County EDC for Thrifty Leoni Inc. Project, 3.82%, 12/1/14(a) | 1,100,000 | |||||||||
| 1,275,000 | Jackson County EDC for Vista Grande Villa Sr Lien, Series A, 3.87%, 11/1/31(a) | 1,275,000 | |||||||||
| 1,455,000 | Michigan MFH Revenue for Berrien Woods III, Series A, 3.86%, 7/1/32(a) | 1,455,000 | |||||||||
| 1,130,000 | Michigan MFH Revenue for River Place Apts., 3.83%, 6/1/18(a) | 1,130,000 | |||||||||
| 300,000 | Michigan GO Bond, Series A, 4.25%, 9/28/07(a) | 300,563 | |||||||||
| 765,000 | Michigan HDA for Single Family Housing, Series 2000 A, 3.80%, 12/1/16(a) | 765,000 | |||||||||
| 285,000 | Michigan HFA for Hospital Equipment, Series A, 3.74%, 12/1/23(a) | 285,000 | |||||||||
| 650,000 | Michigan State University Revenue, Series A, 3.90%, 8/15/32(a)(b) | 650,000 | |||||||||
| 565,000 | Michigan Strategic Fund for Grayling General Solid Waste, 3.84%, 1/1/14(a) | 565,000 | |||||||||
| 1,080,000 | Michigan Strategic Fund for Henry Ford Museum Village Project, 3.89%, 12/1/33(a) | 1,080,000 | |||||||||
| 150,000 | Michigan Strategic Fund for M&P CAP Project, Series A, 3.96%, 6/1/34(a) | 150,000 | |||||||||
| 400,000 | Michigan Strategic Fund for Metaltec Steel Abrasive, 3.84%, 8/1/31(a) | 400,000 | |||||||||
| 800,000 | Michigan Strategic Fund for MOT LLC Project, 3.78%, 12/1/34(a) | 800,000 | |||||||||
| 345,000 | Michigan Strategic Fund for Peachwood Center Association, 3.78%, 6/1/16(a) | 345,000 | |||||||||
| 1,200,000 | Michigan Strategic Fund for Rest Haven Christian Services, 3.79%, 11/15/34(a) | 1,200,000 | |||||||||
| 1,295,000 | Milan Area Schools Unlimited GO Bond, 3.75%, 5/1/30(a) | 1,295,000 | |||||||||
| 500,000 | Oakland County EDC for Graphic-Technology Inc. Project, 3.83%, 4/1/28(a) | 500,000 | |||||||||
| 400,000 | Oakland University General Revenue, 3.80%, 3/1/31(a)(b) | 400,000 | |||||||||
| 260,000 | Wayne Charter County Michigan Airport Revenue, Series A, 3.85%, 12/1/16(a) | 260,000 | |||||||||
| 100,000 | WoodHaven Brownstown School District, Series B, 3.87%, 5/1/34(a)(b) | 100,000 | |||||||||
| 16,155,563 | |||||||||||
| PUERTO RICO—1.1% | |||||||||||
| 175,000 | Puerto Rico Highway & Transportation Authority, Series A, 3.63%, 7/1/28(a) | 175,000 | |||||||||
| Total Investments (Cost* $16,330,563) | 98.7 | % | 16,330,563 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (2,526 | ) | |||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (632 | ) | |||||||
| Other Assets less Liabilities | 1.3 | 213,428 | |||||||||
| Net Assets | 100.0 | % | $ | 16,540,833 | |||||||
Net asset value, offering and redemption price per share, based on $16,540,833 shares of beneficial interest,
$.001 par value outstanding, Class R $1.00
See notes to financial statements.
12
RESERVE MUNICIPAL MONEY-MARKET TRUST II—NEW JERSEY MUNICIPAL MONEY-MARKET FUND
SCHEDULE OF INVESTMENTS—MAY 31, 2007
| Principal Amount | MUNICIPAL MONEY-MARKET OBLIGATIONS—94.3% | Value (Note 1) | |||||||||
| NEW JERSEY—87.9% | |||||||||||
| $ | 560,000 | Atlantic County Pooled Government Loan Program, 3.80%, 7/1/26(a) | $ | 560,000 | |||||||
| 3,850,000 | Hudson County Pooled Government Loan Program, 3.70%, 7/15/26(a) | 3,850,000 | |||||||||
| 2,800,000 | New Jersey EDA for Airis Newark Project, 3.75%, 1/1/19(a) | 2,800,000 | |||||||||
| 1,700,000 | New Jersey EDA for Bayonne Dock Project, Series A, 3.84%, 12/1/27(a) | 1,700,000 | |||||||||
| 1,300,000 | New Jersey EDA for Bayonne Dock Project, Series C, 3.84%, 12/1/27(a) | 1,300,000 | |||||||||
| 800,000 | New Jersey EDA for Foreign Trade, Series 98, 3.90%, 12/1/07(a) | 800,000 | |||||||||
| 4,600,000 | New Jersey EDA for Geriatrics Housing Services, Series P-J, 3.73%, 11/1/31(a) | 4,600,000 | |||||||||
| 1,900,000 | New Jersey EDA for Hun School of Princeton Project, 3.73%, 11/1/34(a)(b) | 1,900,000 | |||||||||
| 3,100,000 | New Jersey EDA for Lawrenceville School Project, Series B, 3.65%, 7/1/26(a)(b) | 3,100,000 | |||||||||
| 3,000,000 | New Jersey EDA for Port Newark Container LLC, 3.78%, 7/1/30(a) | 3,000,000 | |||||||||
| 800,000 | New jersey EDA for Princeton University, Series B, 3.90%, 7/1/21(a)(b) | 800,000 | |||||||||
| 1,300,000 | New Jersey EDA for RJB Associates LP, 3.73%, 8/1/08(a) | 1,300,000 | |||||||||
| 8,115,000 | New Jersey EDA for Thermal Marina Energy LLC, Series A, 3.75%, 9/1/31(a) | 8,115,000 | |||||||||
| 2,200,000 | New Jersey EDA for USGA Project, 3.73%, 5/1/23(a) | 2,200,000 | |||||||||
| 580,000 | New Jersey EDA for UTD Water Service Project A, 3.86%, 11/1/26(a) | 580,000 | |||||||||
| 800,000 | New Jersey EDA for UTD Water Service Project B, 3.82%, 11/1/25(a) | 800,000 | |||||||||
| 1,500,000 | New Jersey EDA Sub-Series R-1, 3.86%, 9/1/31(a) | 1,500,000 | |||||||||
| 800,000 | New Jersey EDA Sub-Series R-2, 3.86%, 9/1/31(a) | 800,000 | |||||||||
| 4,600,000 | New Jersey EDA Sub-Series R-3, 3.36-3.70%, 9/1/31(a) | 4,600,000 | |||||||||
| 4,100,000 | New Jersey EFA, Series B, 3.45-3.87% 7/1/22(a)(b) | 4,100,000 | |||||||||
| 750,000 | New Jersey GO Bond, 4.50%, 6/22/07(a) | 750,396 | |||||||||
| 1,400,000 | New Jersey HCF for Cap Assets, Series A, 3.68% 7/1/35(a) | 1,400,000 | |||||||||
| 1,900,000 | New Jersey HCF for Cap Assets, Series B, 3.68% 7/1/35(a) | 1,900,000 | |||||||||
| 500,000 | New Jersey HCF for Community Hospital, Series A1, 3.76%, 7/1/20(a) | 500,000 | |||||||||
| 2,200,000 | New Jersey HCF for St. Barnabas, Series 2001A, 3.72%, 7/1/31(a) | 2,200,000 | |||||||||
| 1,900,000 | New Jersey Single Family Housing, Series D, 3.88%, 10/1/26(a) | 1,900,000 | |||||||||
| 4,915,000 | New Jersey Sports Authority Expo, Series C, 3.70%, 9/1/24(a) | 4,915,000 | |||||||||
| 1,800,000 | New Jersey Turnpike Authority, Series 91-D, 3.69%, 1/1/18(a) | 1,800,000 | |||||||||
| 6,700,000 | New Jersey Turnpike Authority, Series C-1, 3.70%, 1/1/24(a) | 6,700,000 | |||||||||
| 2,200,000 | New Jersey Turnpike Authority, Series C-2, 3.70%, 1/1/24(a) | 2,200,000 | |||||||||
| 2,800,000 | Port Authority of New York & New Jersey Special Obligation Revenue, 3.85%, 8/1/24(a) | 2,800,000 | |||||||||
| 4,225,000 | Salem County for Friends Home Woodstown Inc., 3.70%, 4/1/34 (a) | 4,225,000 | |||||||||
| 79,695,396 | |||||||||||
| PUERTO RICO—6.4% | |||||||||||
| 2,400,000 | Puerto Rico Government Development Bank, 3.61%, 12/1/15(a) | 2,400,000 | |||||||||
| 3,375,000 | Puerto Rico Highway & Transportation Authority, Series A, 3.63%, 7/1/28(a) | 3,375,000 | |||||||||
| 5,775,000 | |||||||||||
| Total Investments (Cost* $85,470,396) | 94.3 | % | 85,470,396 | ||||||||
| Other Assets Less Liabilities | 5.7 | 5,157,754 | |||||||||
| Net Assets | 100.0 | % | $ | 90,628,150 | |||||||
RESERVE MUNICIPAL MONEY-MARKET TRUST II—NEW JERSEY MUNICIPAL MONEY-MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES
MAY 31, 2007
| Assets | |||||||
| Investments in securities, at value (Cost $85,470,396) | $ | 85,470,396 | |||||
| Cash | 4,820,401 | ||||||
| Interest receivable | 356,289 | ||||||
| Total Assets | 90,647,086 | ||||||
| Liabilities | |||||||
| Comprehensive management fees payable | 13,637 | ||||||
| Distribution (12b-1) fees payable | 3,409 | ||||||
| Trustees fees payable | 19 | ||||||
| Chief Compliance Officer expenses payable | 5 | ||||||
| Other Liabilities | 1,866 | ||||||
| Total Liabilities | 18,936 | ||||||
| Net Assets | $ | 90,628,150 | |||||
| Net asset value, offering and redemption price per share, based on 90,628,150 shares of beneficial interest, $.001 par value outstanding Class R | $ | 1.00 | |||||
See notes to financial statements.
13
RESERVE MUNICIPAL MONEY-MARKET TRUST II—OHIO MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—95.4% | Value (Note 1) | |||||||||
| OHIO—95.4% | |||||||||||
| $ | 375,000 | Allen County HCF for Mennonite Home Project, 3.76%, 2/1/18(a) | $ | 375,000 | |||||||
| 1,050,000 | Butler County HCF for Lifesphere Project, 3.80%, 5/1/27(a) | 1,050,000 | |||||||||
| 100,000 | Centerville HCR for Bethany Lutheran, 3.82%, 5/1/08(a) | 100,000 | |||||||||
| 395,000 | Cleveland Airport Systems Revenue, Series D, 3.81%, 1/1/27(a) | 395,000 | |||||||||
| 600,000 | Cleveland Income Tax Revenue, 3.67%, 5/15/24(a) | 600,000 | |||||||||
| 1,700,000 | Cuyahoga County HCF for Devon Oaks Project, 3.77%, 2/1/34(a) | 1,700,000 | |||||||||
| 1,500,000 | Cuyahoga County HRB EDA for Cleveland Botanical Gardens, 3.79%, 7/1/31(a) | 1,500,000 | |||||||||
| 380,000 | Cuyahoga County IDR for Playhouse Realty Company, 3.70%, 12/1/09(a) | 380,000 | |||||||||
| 1,200,000 | Evandale County IDR for SHV Realty Inc., 3.85%, 9/1/15(a) | 1,200,000 | |||||||||
| 515,000 | Franklin County HRB for U.S. Health Corp., Series 96A, 3.75%, 12/1/21(a) | 515,000 | |||||||||
| 595,000 | Geauga County for Heather Hill Inc., 3.75%, 7/1/23(a) | 595,000 | |||||||||
| 540,000 | Greene County IDA for Fairview, Series B, 3.72%, 1/1/11(a) | 540,000 | |||||||||
| 250,000 | Hamilton County HCF for Episcopal Retirement Homes, Series B, 3.75%, 6/1/35(a) | 250,000 | |||||||||
| 705,000 | Hamilton County HRB for Alliance Health, Series A, 3.70%, 1/1/18(a) | 705,000 | |||||||||
| 1,000,000 | Licking County HCF for Kendal at Granville, 3.76%, 11/1/33(a) | 1,000,000 | |||||||||
| 5,000 | Marion County Hospital Improvement Revenue for Pooled Lease Program, 3.82%, 11/1/21(a) | 5,000 | |||||||||
| 700,000 | Middleburgh Heights for Sowest General Hospital, 3.78%, 8/15/22(a) | 700,000 | |||||||||
| 1,100,000 | Ohio State Air Quality DAR for Ohio Edison, Series C, 3.93%, 6/1/23(a) | 1,100,000 | |||||||||
| 1,190,000 | Ohio State HEFA for Ashland University, 3.81%, 9/1/24(a)(b) | 1,190,000 | |||||||||
| 345,000 | Ohio State HEFA for Case Western University, 3.72%, 10/1/31(a)(b) | 345,000 | |||||||||
| 100,000 | Ohio State University General Receipts, 3.52%, 12/1/27(a)(b) | 100,000 | |||||||||
| 600,000 | Ohio WDA PCR for Edison Project, Series B, 3.94%, 9/1/18(a) | 600,000 | |||||||||
| 760,000 | Ohio WDA PCR for Firstenergy Gen Corp, 3.90%, 5/15/19(a) | 760,000 | |||||||||
| 900,000 | Toledo-Lucas County Port Authority, Series C, 3.75%, 5/15/38(a) | 900,000 | |||||||||
| 16,605,000 | |||||||||||
| Total Investments (Cost* $16,605,000) | 95.4 | % | 16,605,000 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (2,742 | ) | |||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (685 | ) | |||||||
| Other Assets less Liabilities | 4.6 | 806,395 | |||||||||
| Net Assets | 100.0 | % | $ | 17,407,968 | |||||||
| Net asset value, offering and redemption price per share, based on 17,407,968 shares of beneficial interest, $.001 par value outstanding, Class R | $ | 1.00 | |||||||||
See notes to financial statements.
14
RESERVE MUNICIPAL MONEY-MARKET TRUST II—PENNSYLVANIA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | PENNSYLVANIA TAX-EXEMPT OBLIGATIONS—98.0% | Value (Note 1) | |||||||||
| PENNSYLVANIA—98.0% | |||||||||||
| $ | 1,600,000 | Allegheny County IDA for UPMC Health Systems, Series C, 3.78%, 3/1/15(a) | $ | 1,600,000 | |||||||
| 1,700,000 | Beaver County IDA for Firstenergy Nuclear Generator, 3.81%, 1/1/35(a) | 1,700,000 | |||||||||
| 125,000 | Berks County IDR for Visiting Nurse Services, Series A, 3.88%, 12/1/15(a) | 125,000 | |||||||||
| 540,000 | Berks County IDR for Visiting Nurse Services, Series A, 4.03%, 12/1/15(a) | 540,000 | |||||||||
| 305,000 | Bucks County IDA for Law School Admission Council, 3.76%, 5/1/33(a)(b) | 305,000 | |||||||||
| 3,800,000 | Bucks County IDA for SHV Real Estate Inc, 3.85%, 7/1/15(a) | 3,800,000 | |||||||||
| 1,900,000 | Chester County IDA for Archdiocese of Philadelphia, 3.85%, 7/1/31(a) | 1,900,000 | |||||||||
| 995,000 | City of Philadelphia WSR Refund, 3.75%, 6/15/23(a) | 995,000 | |||||||||
| 1,600,000 | Cumberland County for Asbury Group, 3.78%, 1/1/41(a) | 1,600,000 | |||||||||
| 710,000 | Cumberland County for Presbyterian Homes Inc, 3.75%, 12/1/32(a) | 710,000 | |||||||||
| 350,000 | Delaware County IDR for Sun Inc., 3.78%, 11/1/33(a) | 350,000 | |||||||||
| 3,600,000 | Emmaus General Authority Revenue, Series G-18, 3.83%, 3/1/24(a) | 3,600,000 | |||||||||
| 700,000 | Indiana County IDA for Conemaugh, 3.86%, 6/1/27(a) | 700,000 | |||||||||
| 100,000 | Lampeter Strasburg for School District, Series A, 3.78%, 6/1/19(a)(b) | 100,000 | |||||||||
| 2,045,000 | Lawrence County IDA for Villa Maria Project, 3.80%, 7/1/33(a) | 2,045,000 | |||||||||
| 3,110,000 | Lebanon County HCF for ECC Retirement Village, 3.81%, 10/15/25(a) | 3,110,000 | |||||||||
| 310,000 | Montgomery County for IDR Girl Scouts, 3.88%, 2/1/25(a) | 310,000 | |||||||||
| 2,800,000 | Montgomery County MFH for Kingswood Apartments Project, Series A, 3.72%, 8/15/31(a) | 2,800,000 | |||||||||
| 1,085,000 | North Hampton County First Mortgage of Kirkland Village, 3.75%, 11/1/30(a) | 1,085,000 | |||||||||
| 3,715,000 | Pennsylvania Energy Development Authority for Edensburg Project, 3.80%, 12/1/11(a) | 3,715,000 | |||||||||
| 1,000,000 | Pennsylvania HEFA for Association of Independent Colleges, Series E3, 3.75%, 11/1/14(a)(b) | 1,000,000 | |||||||||
| 1,600,000 | Pennsylvania State Higher Education Agency for Student Loan Revenue Bonds, 3.75%, 1/1/18(a)(b) | 1,600,000 | |||||||||
| 1,800,000 | Pennsylvania State Higher Education Agency, Series A, 3.80%, 6/1/29(a)(b) | 1,800,000 | |||||||||
| 2,150,000 | Pennsylvania State Turnpike Commission, Series A-3, 3.81%, 12/1/30(a) | 2,150,000 | |||||||||
| 2,600,000 | Philadelphia IDR for Fox Chase Cancer Center Project, 3.87%, 7/1/25(a) | 2,600,000 | |||||||||
| 1,000,000 | Schuylkill County IDA for Northeastern Power, 3.96%, 12/1/22(a) | 1,000,000 | |||||||||
| 1,000,000 | Scranton Redevelopment Authority, 3.81%, 6/1/33(a) | 1,000,000 | |||||||||
| 3,600,000 | Washington County for University of Pennsylvania, 3.80%, 7/1/34(a)(b) | 3,600,000 | |||||||||
| 1,985,000 | Westmoreland County IDA for Redstone Highlands Apartments, 3.77%, 1/1/36(a) | 1,985,000 | |||||||||
| 3,515,000 | Wilkins Area IDA for Fairview Extended Care, Series B, 3.72%, 1/1/21(a) | 3,515,000 | |||||||||
| 51,340,000 | |||||||||||
| Total Investments (Cost* $51,340,000) | 98.0 | % | 51,340,000 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (8,092 | ) | |||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (2,023 | ) | |||||||
| Other Assets less Liabilities | 2.0 | 1,028,403 | |||||||||
| Net Assets | 100.0 | % | $ | 52,358,288 | |||||||
| Net asset value, offering and redemption price per share based on 52,358,288 shares of beneficial interest, $.001 par value outstanding, Class R | $ | 1.00 | |||||||||
See notes to financial statements.
15
RESERVE MUNICIPAL MONEY-MARKET TRUST II—VIRGINIA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—98.3% | Value (Note 1) | |||||||||
| VIRGINIA—79.2% | |||||||||||
| $ | 1,520,000 | Alexandria County IDA for Goodwin House, 3.85%, 10/1/35(a) | $ | 1,520,000 | |||||||
| 1,950,000 | Arlington County for Ballston Public Parking, 3.80%, 8/1/17(a) | 1,950,000 | |||||||||
| 500,000 | Charlottesville IDA for Seminole, Series B, 3.80%, 12/1/13(a) | 500,000 | |||||||||
| 1,060,000 | Chesapeake County IDA for Chesapeake General Hospital, Series B, 3.76%, 7/1/31(a) | 1,060,000 | |||||||||
| 1,925,000 | Clarke County IDR, 3.80%, 1/1/30(a) | 1,925,000 | |||||||||
| 433,000 | Fairfax County EDA for Smithsonian Institute, 3.75%, 12/1/33(a) | 433,000 | |||||||||
| 1,195,000 | Hampton MFH for Shoreline Apartments, 3.77%, 12/1/19(a) | 1,195,000 | |||||||||
| 1,010,000 | Hanover County IDA for Covenant Woods, 3.81%, 7/1/29(a) | 1,010,000 | |||||||||
| 1,800,000 | Henrico County EDA for White Oaks Ltd Project, 3.84%, 10/1/27(a) | 1,800,000 | |||||||||
| 2,455,000 | King George County IDA for Garnet of VA Inc. Project, 3.81%, 9/1/21(a) | 2,455,000 | |||||||||
| 600,000 | Peninsula Port Authority for Dominion Terminal, 3.80%, 7/1/16(a) | 600,000 | |||||||||
| 2,045,000 | Peninsula Port Authority for Dominion Terminal, 3.88%, 7/1/16(a) | 2,045,000 | |||||||||
| 1,400,000 | Portsmouth HDA MFH for Marsh Landing Project, Series A, 3.81%, 6/1/30(a) | 1,400,000 | |||||||||
| 2,500,000 | University of Virginia General Revenue, Series A, 3.77%, 6/1/34(a)(b) | 2,500,000 | |||||||||
| 20,393,000 | |||||||||||
| PUERTO RICO—19.1% | |||||||||||
| 2,430,000 | Puerto Rico Government Development Bank, 3.61%,12/1/15(a) | 2,430,000 | |||||||||
| 2,500,000 | Puerto Rico Highway & Transportation Authority, Series A, 3.63%, 7/1/28(a) | 2,500,000 | |||||||||
| 4,930,000 | |||||||||||
| Total Investments (Cost* $25,323,000) | 98.3 | % | 25,323,000 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (4,038 | ) | |||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (1,010 | ) | |||||||
| Other Assets less Liabilities | 1.7 | 436,057 | |||||||||
| Net Assets | 100.0 | % | $ | 25,754,009 | |||||||
| Net asset value, offering and redemption price per share, based on 25,754,009 shares of beneficial interest, $.001 par value outstanding, Class R | $ | 1.00 | |||||||||
See notes to financial statements.
16
RESERVE NEW YORK MUNICIPAL MONEY-MARKET TRUST—NEW YORK MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—98.1% | Value (Note 1) | |||||||||
| NEW JERSEY—0.7% | |||||||||||
| $ | 700,000 | Port Authority of New York & New Jersey Special Obligation Revenue, 3.85%, 6/1/20(a) | $ | 700,000 | |||||||
| 1,300,000 | Port Authority of New York & New Jersey Special Obligation Revenue, 3.85%, 8/1/24(a) | 1,300,000 | |||||||||
| 2,000,000 | |||||||||||
| NEW YORK—97.4% | |||||||||||
| 3,420,000 | Babylon IDR for Ogden Martin, 3.69%, 1/1/19(a) | 3,420,000 | |||||||||
| 1,385,000 | Bleecker HDC for Terrace Apt. Project, Series 85, 3.85%, 7/1/15(a) | 1,385,000 | |||||||||
| 3,555,000 | Cattaraugus County IDA for YMCA, 3.84%, 9/1/28(a) | 3,555,000 | |||||||||
| 1,000,000 | Dutchess IDA for Trinity Pawling School, 3.70%, 10/1/32(a)(b) | 1,000,000 | |||||||||
| 2,305,000 | Franklin County IDA Civic Facility for Trudeau Institute, 3.72%, 12/1/20(a) | 2,305,000 | |||||||||
| 2,150,000 | Guilderland IDA for Eastern Industrial Park, Series 93-A, 3.72%, 12/1/08(a) | 2,150,000 | |||||||||
| 6,400,000 | Jay Street Development Corp., Series A-1, 3.70%, 5/1/22(a) | 6,400,000 | |||||||||
| 8,000,000 | Liberty Development Corporation for Greenwich LLC, Series, 3.75% 12/1/39(a) | 8,000,000 | |||||||||
| 5,200,000 | Long Island Power Authority Electric System Revenue, Series 2-A, 3.70%, 5/1/33(a) | 5,200,000 | |||||||||
| 11,200,000 | Metropolitan Transportation Authority, 3.75%, 11/1/35(a) | 11,200,000 | |||||||||
| 2,200,000 | Monroe County for Margaret Woodbury Strong Museum, 3.80%, 4/1/35(a) | 2,200,000 | |||||||||
| 1,400,000 | Monroe County for St. Ann's Home Project, 3.78%, 7/1/30(a) | 1,400,000 | |||||||||
| 4,715,000 | Nassau County Interim Finance Authority, 3.67%, 11/15/22(a) | 4,715,000 | |||||||||
| 1,780,000 | New York City Cultural Resources for Alvin Ailey Dance Foundation, 3.69%, 7/1/33(a) | 1,780,000 | |||||||||
| 3,900,000 | New York City Cultural Resources for Asian Society, 3.72%, 4/1/30(a) | 3,900,000 | |||||||||
| 3,715,000 | New York City GO, Series A, 3.58%, 3/13/20(a) | 3,715,000 | |||||||||
| 2,760,000 | New York City GO, Series A4, 3.84%, 8/1/23(a) | 2,760,000 | |||||||||
| 225,000 | New York City GO, Series A7, 3.86%, 8/1/20(a) | 225,000 | |||||||||
| 900,000 | New York City GO, Series B5, 3.89%, 8/15/11(a) | 900,000 | |||||||||
| 1,000,000 | New York City GO, Series B5, 3.89%, 8/15/22(a) | 1,000,000 | |||||||||
| 7,600,000 | New York City GO, Series C4, 3.68%, 8/1/20(a) | 7,600,000 | |||||||||
| 20,000,000 | New York City GO, Series C5, 3.69%, 8/1/20(a) | 20,000,000 | |||||||||
| 590,000 | New York City GO, Series H1, 3.84%, 3/1/34(a) | 590,000 | |||||||||
| 1,900,000 | New York City GO, Series H2, 3.89%, 8/1/13(a) | 1,900,000 | |||||||||
| 2,200,000 | New York City HDC for Monterey, Series A, 3.70%, 11/15/19(a) | 2,200,000 | |||||||||
| 5,700,000 | New York City HFA for Worth Street Market, 3.83%, 5/15/33(a) | 5,700,000 | |||||||||
| 3,635,000 | New York City IDA for American Society for Technion, 3.69%, 10/1/33(a) | 3,635,000 | |||||||||
| 3,500,000 | New York City IDA for Children's Oncology Society, 3.75%, 5/1/21(a) | 3,500,000 | |||||||||
| 7,800,000 | New York City IDA for Liberty-FC Hanson, 3.78%, 12/1/39(a) | 7,800,000 | |||||||||
| 4,000,000 | New York City MFH for Brookhaven Apartments, Series A, 3.76%, 1/1/36(a) | 4,000,000 | |||||||||
| 1,000,000 | New York City MWFA WSR for NYC Recovery, Series 3, Sub-series 3B, 3.88%, 6/15/23(a) | 1,000,000 | |||||||||
| 1,700,000 | New York City MWFA WSR for NYC Recovery, Series 3, Sub-series 3H, 3.88%, 6/15/22(a) | 1,700,000 | |||||||||
| 2,800,000 | New York City MWFA WSR for NYC Recovery, Series A, 3.84%, 6/15/25(a) | 2,800,000 | |||||||||
| 1,800,000 | New York City MWFA WSR for NYC Recovery, Series G, 3.86%, 6/15/24(a) | 1,800,000 | |||||||||
| 4,250,000 | New York City TFA BAN, 4.25%, 6/29/07(a) | 4,251,988 | |||||||||
| 800,000 | New York City TFA, Series C, 3.89%, 5/1/28(a) | 800,000 | |||||||||
| 9,000,000 | New York City TFA, Series H3, 3.92%, 11/1/22(a) | 9,000,000 | |||||||||
| 150,000 | New York City TFA, Series H3, 3.89%, 11/1/22(a) | 150,000 | |||||||||
| 4,000,000 | New York State Con Edison Research and Development, Sub-Series C-2, 3.75%, 11/1/39(a) | 4,000,000 | |||||||||
| 1,500,000 | New York State Energy Resources and Development, 3.80%, 12/1/27(a) | 1,500,000 | |||||||||
See notes to financial statements.
17
RESERVE NEW YORK MUNICIPAL MONEY-MARKET TRUST—NEW YORK MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007 (Continued)
| Principal Amount | TAX-EXEMPT OBLIGATIONS (Continued) | Value (Note 1) | |||||||||
| NEW YORK (Continued) | |||||||||||
| $ | 6,700,000 | New York State HFA for 10 Liberty Street, 3.70%, 5/1/35(a) | $ | 6,700,000 | |||||||
| 6,500,000 | New York State HFA for 270 East Burnside Avenue Apartments, 3.81%, 1/15/39(a) | 6,500,000 | |||||||||
| 10,300,000 | New York State HFA for 350 West 43rd Street Housing, 3.88%, 11/1/34(a) | 10,300,000 | |||||||||
| 500,000 | New York State HFA for Victory Housing, Series 2000 A, 3.83%, 11/1/33(a) | 500,000 | |||||||||
| 2,500,000 | New York State HFA, Series C, 3.78%, 3/15/26(a) | 2,500,000 | |||||||||
| 16,000,000 | New York State LGAC, Series 4V, 3.73%, 4/1/22(a) | 16,000,000 | |||||||||
| 1,000,000 | New York State LGAC, Series B, 3.67%, 4/1/23(a) | 1,000,000 | |||||||||
| 8,930,000 | New York State LGAC, Series B, 3.70%, 4/1/25(a) | 8,930,000 | |||||||||
| 3,200,000 | New York State LGAC, Series D, 3.77%, 4/1/25(a) | 3,200,000 | |||||||||
| 3,500,000 | New York State MFH for Avalon Bowery Place II-A, 3.84%, 11/1/39(a) | 3,500,000 | |||||||||
| 3,900,000 | New York State MFH, Series C, 3.78%, 3/15/26(a) | 3,900,000 | |||||||||
| 2,750,000 | Rotterdam IDA for Industrial Park Project, 3.72%, 11/1/09(a) | 2,750,000 | |||||||||
| 4,455,000 | Tompkins County IDA for Kendal Ithaca Community Care, Series B, 3.82%, 7/1/24(a) | 4,455,000 | |||||||||
| 16,000,000 | Triborough Bridge & Tunnel Authority, Series B1, 3.73%, 1/1/32(a) | 16,000,000 | |||||||||
| 19,250,000 | Triborough Bridge & Tunnel Authority, Series B3, 3.75%, 1/1/32(a) | 19,250,000 | |||||||||
| 7,100,000 | Triborough Bridge & Tunnel Authority, Series F, 3.77%, 11/1/32(a) | 7,100,000 | |||||||||
| 7,120,000 | Westchester IDA for Catherine Field Home, 3.76%, 1/1/31(a) | 7,120,000 | |||||||||
| 270,841,988 | |||||||||||
| Total Investments (Cost* $272,841,988) | 98.1 | % | 272,841,988 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (6,093 | ) | |||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (1,523 | ) | |||||||
| Other Assets less Liabilities | 1.9 | 5,170,927 | |||||||||
| Net Assets | 100.0 | % | $ | 278,005,299 | |||||||
| Net asset value, offering and redemption price per share of each class based on shares of beneficial interest, $.001 par value outstanding and equivalent to the Net Assets of each Class: | |||||||||||
| 277,995,151 shares, Class R | $ | 1.00 | |||||||||
| 10,148 shares, Class Treasurer's Trust | $ | 1.00 | |||||||||
See notes to financial statements.
18
RESERVE MUNICIPAL MONEY-MARKET TRUST—ARIZONA MUNICIPAL MONEY-MARKET FUND
SCHEDULE OF INVESTMENTS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—45.6% | Value (Note 1) | |||||||||
| ARIZONA—39.6% | |||||||||||
| $ | 18,000 | Apache County IDA for Tucson Electric Power, 3.74%, 12/1/20(a) | $ | 18,000 | |||||||
| 18,000 | Apache County IDA for Tucson Electric Power, 3.74%, 12/15/18(a) | 18,000 | |||||||||
| 8,000 | Apache County IDA for Tucson Electric Power, 3.80%, 12/15/18(a) | 8,000 | |||||||||
| 21,000 | Arizona HFA for Arizona Volunteer Hospital, Series B, 3.76%, 10/1/15(a) | 21,000 | |||||||||
| 21,000 | Arizona HFA for Royal Oaks Project, 3.75%, 3/1/27(a) | 21,000 | |||||||||
| 21,000 | Coconino PCR for Arizona Public Service Co. Project, 3.92%, 11/1/33(a) | 21,000 | |||||||||
| 21,000 | Maricopa County IDA FNMA for Las Gardenias Apartments A, 3.92%, 4/15/33(a) | 21,000 | |||||||||
| 8,000 | McAllister Village for Arizona State University Project, 3.77%, 7/1/45(a)(b) | 8,000 | |||||||||
| 19,000 | Phoenix IDR for Del Mar Terrace, 3.75%, 10/1/29(a) | 19,000 | |||||||||
| 10,000 | Pima County IDR for Tucson Electric Power Co., Series 82 A, 3.80%, 12/1/22(a) | 10,000 | |||||||||
| 21,000 | Salt River Pima for Indian Community, 3.76%, 10/1/26(a) | 21,000 | |||||||||
| 21,000 | Scottsdale IDA for Notre Dame, Series A, 3.83%, 5/1/21(a) | 21,000 | |||||||||
| 207,000 | |||||||||||
| PUERTO RICO—6.0% | |||||||||||
| 21,000 | Puerto Rico Government Development Bank, 3.61%, 12/1/15(a) | 21,000 | |||||||||
| 10,000 | Puerto Rico Highway & Transportation Authority, Series A, 3.63%, 7/1/28(a) | 10,000 | |||||||||
| 31,000 | |||||||||||
| Total Investments (Cost* $238,000) | 45.6 | % | 238,000 | ||||||||
| Other Assets less Liabilities | 54.4 | 284,300 | |||||||||
| Net Assets | 100.0 | % | $ | 522,300 | |||||||
RESERVE MUNICIPAL MONEY-MARKET TRUST—ARIZONA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF ASSETS AND LIABILITIES
MAY 31, 2007
| Assets | |||||||
| Investments in securities, at value (Cost $238,000) | $ | 238,000 | |||||
| Cash | 283,035 | ||||||
| Interest receivable | 1,366 | ||||||
| Total Assets | 522,401 | ||||||
| Liabilities | |||||||
| Comprehensive management fees payable | 81 | ||||||
| Distribution (12b-1) fees payable | 20 | ||||||
| Total Liabilities | 101 | ||||||
| Net Assets | $ | 522,300 | |||||
| Net asset value, offering and redemption price per share, based on $522,300 shares of beneficial interest, $.0001 par value outstanding, Class R | $ | 1.00 | |||||
See notes to financial statements.
19
RESERVE MUNICIPAL MONEY-MARKET TRUST—LOUISIANA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—99.3% | Value (Note 1) | |||||||||
| LOUISIANA—81.4% | |||||||||||
| $ | 440,000 | Lake Charles HRB & Term. District Revenue for CITGO Corp., 3.83%, 8/1/07(a) | $ | 440,000 | |||||||
| 440,000 | Louisiana Local Govt. Environment Facilities DAR, Series A, 3.78%, 11/1/34(a) | 440,000 | |||||||||
| 440,000 | Louisiana Local Govt. for Shreveport Utility System Project, 3.82%, 10/1/26(a) | 440,000 | |||||||||
| 100,000 | Louisiana Offshore Term. Auth. Deepwater Port Rev. for Loop LLC, Series A, 3.90%, 9/1/17(a) | 100,000 | |||||||||
| 130,000 | Louisiana PFA for Kenner Hotel Limited, 3.88%,12/1/15(a) | 130,000 | |||||||||
| 100,000 | Louisiana PFA Multifamily for RMK, 3.77%, 6/15/31(a) | 100,000 | |||||||||
| 430,000 | Louisiana State University A&M College Revenue, 3.77%, 7/1/30(a)(b) | 430,000 | |||||||||
| 340,000 | Port of New Orleans Cold Storage Project, 3.86%, 11/1/22(a) | 340,000 | |||||||||
| 430,000 | South Louisiana Port Marine Term. for Holnam Inc. Project., 3.86%, 1/1/27(a) | 430,000 | |||||||||
| 440,000 | South Louisiana Port Marine Term. for Occidental Petroleum Corp., 3.75% 7/1/18(a) | 440,000 | |||||||||
| 440,000 | South Louisiana Port Marine Term. for Occidental Petroleum Corp., 3.80% 7/1/21(a) | 440,000 | |||||||||
| 3,730,000 | |||||||||||
| PUERTO RICO—17.9% | |||||||||||
| 395,000 | Puerto Rico Commonwealth Government Bank, 3.61%, 12/1/15(a) | 395,000 | |||||||||
| 425,000 | Puerto Rico Highway & Transportation Authority, Series A, 3.63%, 7/1/28(a) | 425,000 | |||||||||
| 820,000 | |||||||||||
| Total Investments (Cost* $4,550,000) | 99.3 | % | 4,550,000 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (723 | ) | |||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (181 | ) | |||||||
| Other Assets less Liabilities | 0.7 | 34,228 | |||||||||
| Net Assets | 100.0 | % | $ | 4,583,324 | |||||||
| Net asset value, offering and redemption price per share, based on 4,583,324 shares of beneficial interest, $.0001 par value outstanding, Class R | $ | 1.00 | |||||||||
See notes to financial statements.
20
RESERVE MUNICIPAL MONEY-MARKET TRUST—MINNESOTA MUNICIPAL MONEY-MARKET FUND
STATEMENT OF NET ASSETS—MAY 31, 2007
| Principal Amount | TAX-EXEMPT OBLIGATIONS—97.0% | Value (Note 1) | |||||||||
| MINNESOTA—89.8% | |||||||||||
| $ | 450,000 | Andover Senior Housing for Presbyterian Homes Inc. Project, 3.77%, 11/15/33(a) | $ | 450,000 | |||||||
| 100,000 | Brooklyn Center for Brookdale Corp II Project, 3.95%, 12/1/14(a) | 100,000 | |||||||||
| 280,000 | Cohasset for Minnesota Power & Light Project, Series B, 3.77%, 6/1/13(a) | 280,000 | |||||||||
| 100,000 | Mankato MHR for Highland Apartments, 3.95%, 5/1/27(a) | 100,000 | |||||||||
| 190,000 | Minneapolis Revenue for People Serving People Project, 3.95%, 10/1/21(a) | 190,000 | |||||||||
| 570,000 | Minnesota Health for Fairview Health Services, 3.76%, 11/15/32(a) | 570,000 | |||||||||
| 568,000 | Minnesota HEFA for Residential Housing, Series C, 3.80%, 1/1/35(a) | 568,000 | |||||||||
| 150,000 | Minnesota HEFA for St. Olaf College, Series 5-H, 3.90%, 10/1/30(a)(b) | 150,000 | |||||||||
| 418,000 | Minnesota HEFA for St. Olaf College, Series 5-M1, 3.90%, 10/1/32(a)(b) | 418,000 | |||||||||
| 130,000 | Roseville Commercial Development for Berger Transfer Storage, Series F, 3.71%, 12/1/15(a) | 130,000 | |||||||||
| 28,000 | St. Louis Park Revenue for Catholic Finance Corp., 3.79%, 10/1/25(a) | 28,000 | |||||||||
| 210,000 | St. Paul HDA for District Heating Revenue, 3.77%, 12/1/12(a) | 210,000 | |||||||||
| 100,000 | St. Paul HDA for Public Radio Project, 3.90%, 6/16/10(a) | 100,000 | |||||||||
| 563,000 | St. Paul MHR for Highland Ridge Project, 3.77%, 10/1/33(a) | 563,000 | |||||||||
| 513,000 | University of Minnesota Intermediate Term, Series A, 3.77%, 7/1/08(a)(b) | 513,000 | |||||||||
| 4,370,000 | |||||||||||
| PUERTO RICO—7.2% | |||||||||||
| 350,000 | Puerto Rico Government Development Bank, 3.61%, 12/1/15(a) | 350,000 | |||||||||
| Total Investments (Cost* $4,720,000) | 97.0 | % | 4,720,000 | ||||||||
| Comprehensive management fees payable | 0.0 | ^ | (839 | ) | |||||||
| Distribution (12b-1) fees payable | 0.0 | ^ | (210 | ) | |||||||
| Other Assets less Liabilities | 3.0 | 146,778 | |||||||||
| Net Assets | 100.0 | % | $ | 4,865,729 | |||||||
| Net asset value, offering and redemption price per share, based on 4,865,729 shares of beneficial interest, $.0001 par value outstanding, Class R | $ | 1.00 | |||||||||
See notes to financial statements.
21
Security Type Abbreviations
| BAN | — | Bond Anticipation Note | HFC | — | Housing Finance Corporation | ||||||||||||||||||
| CDA | — | Community Development Authority | HRB | — | Hospital Revenue Bonds | ||||||||||||||||||
| COP | — | Certificate of Participation | IDA | — | Industrial Development Authority Revenue Bonds | ||||||||||||||||||
| DAR | — | Development Authority Revenue Bonds | IDR | — | Industrial Development Agency Revenue Bonds | ||||||||||||||||||
| DFA | — | Development Finance Agency | IFA | — | Industrial Finance Authority | ||||||||||||||||||
| ECFA | — | Education & Cultural Facility Authority | LGAC | — | Local Government Assistance Corp. | ||||||||||||||||||
| EDA | — | Economic Development Authority Revenue Bonds | MFH | — | Multifamily Housing Revenue Bonds | ||||||||||||||||||
| EDC | — | Economic Development Corporation | MHR | — | Multifamily Housing Revenue Bonds | ||||||||||||||||||
| EFA | — | Education Facilities Authority | MWFA | — | Municipal Water Finance Authority | ||||||||||||||||||
| GO | — | General Obligation Bonds | PCR | — | Pollution Control Revenue Bonds | ||||||||||||||||||
| HCF | — | Health Care Facilities Revenue Bonds | PFA | — | Public Facilities Authority | ||||||||||||||||||
| HCR | — | Health Care Revenue | TFA | — | Transitional Finance Authority | ||||||||||||||||||
| HDA | — | Housing Development Authority | WDA | — | Water Development Authority | ||||||||||||||||||
| HDC | — | Housing Development Corporation | WFA | — | Water Finance Authority | ||||||||||||||||||
| HDR | — | Housing Development Revenue | WRA | — | Water Resource Authority | ||||||||||||||||||
| HEFA | — | Health & Education Facilities Authority | WSR | — | Water & Sewer System Revenue Bonds | ||||||||||||||||||
| HFA | — | Housing Finance Authority Revenue Bonds | |||||||||||||||||||||
(a) Variable rate securities. The interest rates shown are, as reported on May 31, 2007, subject to change periodically.
(b) Obligations of educational facilities.
^ Amount is less than 0.05%.
* The cost of investments for federal income tax purposes is the same as the cost for financial reporting purposes.
See notes to financial statements.
22
STATEMENTS OF OPERATIONS
For the Year Ended May 31, 2007
| Reserve Municipal Money-Market Trust II | |||||||||||||||||||
| California Fund | Connecticut Fund | Florida Fund | Massachusetts Fund | ||||||||||||||||
| Interest Income (Note 1) | $ | 4,894,002 | $ | 1,128,303 | $ | 2,034,142 | $ | 936,105 | |||||||||||
| Expenses (Note 2) | |||||||||||||||||||
| Comprehensive management fees, Class R | 1,119,500 | 253,871 | 450,701 | 208,813 | |||||||||||||||
| Distribution (12b-1) fees | 279,875 | 63,468 | 112,675 | 52,203 | |||||||||||||||
| Trustee fee | 1,309 | 276 | 455 | 236 | |||||||||||||||
| Chief Compliance Officer salary expense | 537 | 135 | 296 | 106 | |||||||||||||||
| Interest expense | 2,785 | 1,303 | 2,429 | 1,319 | |||||||||||||||
| Total expenses before waiver | 1,404,006 | 319,053 | 566,556 | 262,677 | |||||||||||||||
| Less: expenses waived (Note 2) | (4,304 | ) | (14,896 | ) | (7,165 | ) | (2,905 | ) | |||||||||||
| Net Expenses | 1,399,702 | 304,157 | 559,391 | 259,772 | |||||||||||||||
| Net Investment Income, representing Net Increase in Net Assets from Investment Operations | $ | 3,494,300 | $ | 824,146 | $ | 1,474,751 | $ | 676,333 | |||||||||||
| Reserve Municipal Money-Market Trust II | |||||||||||||||||||||||
| Michigan Fund | New Jersey Fund | Ohio Fund | Pennsylvania Fund | Virginia Fund | |||||||||||||||||||
| Interest Income (Note 1) | $ | 492,385 | $ | 2,177,338 | $ | 629,328 | $ | 2,138,216 | $ | 805,576 | |||||||||||||
| Expenses (Note 2) | |||||||||||||||||||||||
| Comprehensive management fees, Class R | 108,703 | 482,418 | 139,441 | 471,216 | 180,265 | ||||||||||||||||||
| Distribution (12b-1) fees | 27,175 | 120,604 | 34,859 | 117,804 | 45,067 | ||||||||||||||||||
| Trustee fee | 126 | 523 | 164 | 540 | 200 | ||||||||||||||||||
| Chief Compliance Officer salary expense | 73 | 273 | 106 | 251 | 80 | ||||||||||||||||||
| Interest expense | 1,825 | 3,525 | 2,380 | 9,223 | 1,145 | ||||||||||||||||||
| Total expenses before waiver | 137,902 | 607,343 | 176,950 | 599,034 | 226,757 | ||||||||||||||||||
| Less: expenses waived (Note 2) | (3,259 | ) | (12,358 | ) | (2,757 | ) | (8,573 | ) | (8,943 | ) | |||||||||||||
| Net Expenses | 134,643 | 594,985 | 174,193 | 590,461 | 217,814 | ||||||||||||||||||
| Net Investment Income, representing Net Increase in Net Assets from Investment Operations | $ | 357,742 | $ | 1,582,353 | $ | 455,135 | $ | 1,547,755 | $ | 587,762 | |||||||||||||
See notes to financial statements.
23
STATEMENTS OF OPERATIONS
For the Year Ended May 31, 2007
| Reserve New York Municipal Money- Market Trust | Reserve Municipal Money-Market Trust | ||||||||||||||||||
| New York Fund | Arizona Fund | Louisiana Fund | Minnesota Fund | ||||||||||||||||
| Interest Income (Note 1) | $ | 7,081,841 | $ | 60,254 | $ | 149,206 | $ | 178,776 | |||||||||||
| Expenses (Note 2) | |||||||||||||||||||
| Comprehensive management fees: | |||||||||||||||||||
| Class R | 1,580,387 | 13,562 | 33,010 | 41,952 | |||||||||||||||
| Class Treasurer's Trust | 29 | — | — | — | |||||||||||||||
| Distribution (12b-1) fees: | |||||||||||||||||||
| Class R | 395,097 | 3,390 | 8,253 | 10,488 | |||||||||||||||
| Trustee fee | 1,730 | 18 | 45 | 40 | |||||||||||||||
| Chief Compliance Officer salary expense | 884 | — | 7 | 14 | |||||||||||||||
| Interest expense | 4,273 | 394 | 1,255 | 586 | |||||||||||||||
| Total expenses before waiver | 1,982,400 | 17,364 | 42,570 | 53,080 | |||||||||||||||
| Less: expenses waived (Note 2) | (10,159 | ) | (1,079 | ) | (1,312 | ) | (13,958 | ) | |||||||||||
| Net Expenses | 1,972,241 | 16,285 | 41,258 | 39,122 | |||||||||||||||
| Net Investment Income, representing Net Increase in Net Assets from Investment Operations | $ | 5,109,600 | $ | 43,969 | $ | 107,948 | $ | 139,654 | |||||||||||
See notes to financial statements.
24
RESERVE MUNICIPAL MONEY-MARKET TRUST II—INTERSTATE TAX-EXEMPT FUND
STATEMENT OF OPERATIONS
For the Year Ended May 31, 2007
| Interest Income (Note 1) | $ | 39,526,416 | |||||
| Expenses (Note 2) | |||||||
| Comprehensive management fees: | |||||||
| Class R | 2,490,695 | ||||||
| Class Treasurer's Trust | 421,739 | ||||||
| Class 75 | 31,578 | ||||||
| Class 70 | 22,148 | ||||||
| Class 45 | 1,681 | ||||||
| Class 25 | 129,346 | ||||||
| Class 15 | 161 | ||||||
| Class Institutional* | 568,159 | ||||||
| Class 8* | 144,556 | ||||||
| Distribution (12b-1) fees: | |||||||
| Class R | 622,674 | ||||||
| Class Treasurer's Trust | 2 | ||||||
| Class 75 | 11,483 | ||||||
| Class 70 | 8,859 | ||||||
| Trustee fee | 10,507 | ||||||
| Chief Compliance Officer Salary expense | 4,780 | ||||||
| Interest expense | 56,145 | ||||||
| Total expenses before waiver | 4,524,513 | ||||||
| Less: expenses waived (Note 2) | (118,412 | ) | |||||
| Net Expenses | 4,406,101 | ||||||
| Net Investment Income | 35,120,315 | ||||||
| Net realized loss | (27,786 | ) | |||||
| Net Increase in Net Assets from Investment Operations | $ | 35,092,529 | |||||
RESERVE MUNICIPAL MONEY-MARKET TRUST II—INTERSTATE TAX-EXEMPT FUND
STATEMENT OF CHANGES IN NET ASSETS
| Year Ended May 31, 2007 | Year Ended May 31, 2006 | ||||||||||
| Increase in Net Assets from Investment Operations: | |||||||||||
| Net investment income | $ | 35,120,315 | $ | 28,396,150 | |||||||
| Net realized loss | (27,786 | ) | — | ||||||||
| Total increase in net assets from investment operations | 35,092,529 | 28,396,150 | |||||||||
| Dividens Paid to Shareholders from Net Investment Income (Note 1): | |||||||||||
| Class R | (8,063,977 | ) | (5,184,121 | ) | |||||||
| Class Treasurer's Trust | (2,114,926 | ) | (913,838 | ) | |||||||
| Class 75 | (162,698 | ) | (23,419 | ) | |||||||
| Class 70 | (129,181 | ) | (41,196 | ) | |||||||
| Class 45 | (11,716 | ) | (6,358 | ) | |||||||
| Class 25 | (1,723,347 | ) | (954,097 | ) | |||||||
| Class 15 | (3,695 | ) | (2,652 | ) | |||||||
| Class Institutional* | (16,601,095 | ) | (278 | ) | |||||||
| Class 8* | (6,309,680 | ) | (21,270,191 | ) | |||||||
| Total dividends to shareholders | (35,120,315 | ) | (28,396,150 | ) | |||||||
| From Capital Share Transactions (Note 6) | |||||||||||
| (at net asset value of $1.00 per share): | |||||||||||
| Proceeds from sale of shares | 12,613,661,628 | 14,627,363,666 | |||||||||
| Dividends reinvested | 32,915,537 | 24,824,501 | |||||||||
| Cost of shares redeemed | (13,032,081,977 | ) | (14,855,232,668 | ) | |||||||
| (385,504,812 | ) | (203,044,501 | ) | ||||||||
| Net decrease in net assets | (385,532,598 | ) | (203,044,501 | ) | |||||||
| Net Assets: | |||||||||||
| Beginning of year | 1,209,277,250 | 1,412,321,751 | |||||||||
| End of year | $ | 823,744,652 | $ | 1,209,277,250 | |||||||
* Effective September 1, 2006, Class 12 was renamed Class Institutional, and Class 8 is no longer being offered.
See notes to financial statements.
25
STATEMENTS OF CHANGES IN NET ASSETS
| Reserve Municipal Money-Market Trust II | |||||||||||||||||||
| California Fund | Connecticut Fund | ||||||||||||||||||
| Year Ended May 31, 2007 | Year Ended May 31, 2006 | Year Ended May 31, 2007 | Year Ended May 31, 2006 | ||||||||||||||||
| Increase (Decrease) in Net Assets: from Investment Operations: | |||||||||||||||||||
| Net investment income | $ | 3,494,300 | $ | 2,047,962 | $ | 824,146 | $ | 461,210 | |||||||||||
| Dividends Paid to Shareholders from: | |||||||||||||||||||
| Net investment income-Class R (Note 1) | (3,494,300 | ) | (2,047,962 | ) | (824,146 | ) | (461,210 | ) | |||||||||||
| From Capital Share Transactions | |||||||||||||||||||
| (at net asset value of $1.00 per share): | |||||||||||||||||||
| Proceeds from sale of shares | 637,731,986 | 516,214,214 | 125,090,416 | 85,601,734 | |||||||||||||||
| Dividends reinvested | 3,191,678 | 2,007,889 | 771,687 | 455,318 | |||||||||||||||
| Cost of shares redeemed | (631,517,799 | ) | (499,290,565 | ) | (106,628,528 | ) | (82,099,259 | ) | |||||||||||
| 9,405,865 | 18,931,538 | 19,233,575 | 3,957,793 | ||||||||||||||||
| Net increase (decrease) in net assets | 9,405,865 | 18,931,538 | 19,233,575 | 3,957,793 | |||||||||||||||
| Net Assets: | |||||||||||||||||||
| Beginning of year | 124,133,711 | 105,202,173 | 27,344,562 | 23,386,769 | |||||||||||||||
| End of year | $ | 133,539,576 | $ | 124,133,711 | $ | 46,578,137 | $ | 27,344,562 | |||||||||||
See notes to financial statements.
26
STATEMENTS OF CHANGES IN NET ASSETS
| Reserve Municipal Money-Market Trust II | |||||||||||||||||||||||||||
| Florida Fund | Massachusetts Fund | Michigan Fund | |||||||||||||||||||||||||
| Year Ended May 31, 2007 | Year Ended May 31, 2006 | Year Ended May 31, 2007 | Year Ended May 31, 2006 | Year Ended May 31, 2007 | Year Ended May 31, 2006 | ||||||||||||||||||||||
| Increase (Decrease) in Net Assets: from Investment Operations: | |||||||||||||||||||||||||||
| Net investment income | $ | 1,474,751 | $ | 940,891 | $ | 676,333 | $ | 401,405 | $ | 357,742 | $ | 267,391 | |||||||||||||||
| Dividends Paid to Shareholders from: | |||||||||||||||||||||||||||
| Net investment income-Class R (Note 1) | (1,474,751 | ) | (940,891 | ) | (676,333 | ) | (401,405 | ) | (357,742 | ) | (267,391 | ) | |||||||||||||||
| From Capital Share Transactions | |||||||||||||||||||||||||||
| (at net asset value of $1.00 per share): | |||||||||||||||||||||||||||
| Proceeds from sale of shares | 305,908,620 | 259,543,792 | 112,355,884 | 112,988,911 | 75,830,827 | 62,946,219 | |||||||||||||||||||||
| Dividends reinvested | 1,331,113 | 912,761 | 619,839 | 396,697 | 322,218 | 264,352 | |||||||||||||||||||||
| Cost of shares redeemed | (288,702,494 | ) | (248,491,628 | ) | (117,035,101 | ) | (107,075,531 | ) | (75,865,368 | ) | (63,589,665 | ) | |||||||||||||||
| 18,537,239 | 11,964,925 | (4,059,378 | ) | 6,310,077 | 287,677 | (379,094 | ) | ||||||||||||||||||||
| Net increase (decrease) in net assets | 18,537,239 | 11,964,925 | (4,059,378 | ) | 6,310,077 | 287,677 | (379,094 | ) | |||||||||||||||||||
| Net Assets: | |||||||||||||||||||||||||||
| Beginning of year | 55,058,444 | 43,093,519 | 28,462,658 | 22,152,581 | 16,253,156 | 16,632,250 | |||||||||||||||||||||
| End of year | $ | 73,595,683 | $ | 55,058,444 | $ | 24,403,280 | $ | 28,462,658 | $ | 16,540,833 | $ | 16,253,156 | |||||||||||||||
See notes to financial statements.
27
STATEMENTS OF CHANGES IN NET ASSETS
| Reserve Municipal Money-Market Trust II | |||||||||||||||||||||||||||||||||||
| New Jersey Fund | Ohio Fund | Pennsylvania Fund | Virginia Fund | ||||||||||||||||||||||||||||||||
| Year Ended May 31, 2007 | Year Ended May 31, 2006 | Year Ended May 31, 2007 | Year Ended May 31, 2006 | Year Ended May 31, 2007 | Year Ended May 31, 2006 | Year Ended May 31, 2007 | Year Ended May 31, 2006 | ||||||||||||||||||||||||||||
| Increase (Decrease) in Net Assets: from Investment Operations: | |||||||||||||||||||||||||||||||||||
| Net investment income | $ | 1,582,353 | $ | 929,631 | $ | 455,135 | $ | 352,023 | $ | 1,547,755 | $ | 823,497 | $ | 587,762 | $ | 306,255 | |||||||||||||||||||
| Dividends Paid to Shareholders from: | |||||||||||||||||||||||||||||||||||
| Net investment income-Class R (Note 1) | (1,582,353 | ) | (929,631 | ) | (455,135 | ) | (352,023 | ) | (1,547,755 | ) | (823,497 | ) | (587,762 | ) | (306,255 | ) | |||||||||||||||||||
| From Capital Share Transactions | |||||||||||||||||||||||||||||||||||
| (at net asset value of $1.00 per share): | |||||||||||||||||||||||||||||||||||
| Proceeds from sale of shares | 280,636,860 | 255,094,826 | 93,407,271 | 67,920,236 | 233,286,145 | 222,021,394 | 81,880,020 | 81,454,407 | |||||||||||||||||||||||||||
| Dividends reinvested | 1,415,495 | 908,420 | 419,038 | 349,991 | 1,487,201 | 807,411 | 532,329 | 302,392 | |||||||||||||||||||||||||||
| Cost of shares redeemed | (245,470,880 | ) | (246,945,655 | ) | (95,082,803 | ) | (68,629,751 | ) | (231,286,331 | ) | (218,650,897 | ) | (77,349,645 | ) | (74,771,092 | ) | |||||||||||||||||||
| 36,581,475 | 9,057,591 | (1,256,494 | ) | (359,524 | ) | 3,487,015 | 4,177,908 | 5,062,704 | 6,985,707 | ||||||||||||||||||||||||||
| Net increase (decrease) in net assets | 36,581,475 | 9,057,591 | (1,256,494 | ) | (359,524 | ) | 3,487,015 | 4,177,908 | 5,062,704 | 6,985,707 | |||||||||||||||||||||||||
| Net Assets: | |||||||||||||||||||||||||||||||||||
| Beginning of year | 54,046,675 | 44,989,084 | 18,664,462 | 19,023,986 | 48,871,273 | 44,693,365 | 20,691,305 | 13,705,598 | |||||||||||||||||||||||||||
| End of year | $ | 90,628,150 | $ | 54,046,675 | $ | 17,407,968 | $ | 18,664,462 | $ | 52,358,288 | $ | 48,871,273 | $ | 25,754,009 | $ | 20,691,305 | |||||||||||||||||||
See notes to financial statements.
28
STATEMENTS OF CHANGES IN NET ASSETS
| Reserve New York Municipal Money-Market Trust | Reserve Municipal Money-Market Trust | ||||||||||||||||||||||||||||||||||
| New York Fund | Arizona Fund | Louisiana Fund | Minnesota Fund | ||||||||||||||||||||||||||||||||
| Year Ended May 31, 2007 | Year Ended May 31, 2006 | Year Ended May 31, 2007 | Period Ended May 31, 2006** | Year Ended May 31, 2007 | Year Ended May 31, 2006 | Year Ended May 31, 2007 | Year Ended May 31, 2006 | ||||||||||||||||||||||||||||
| Increase (Decrease) in Net Assets: | |||||||||||||||||||||||||||||||||||
| From Investment Operations: | |||||||||||||||||||||||||||||||||||
| Net investment income | $ | 5,109,600 | $ | 3,171,710 | $ | 43,969 | $ | 424 | $ | 107,948 | $ | 19,453 | $ | 139,654 | $ | 43,669 | |||||||||||||||||||
| Dividends paid to Shareholders from | |||||||||||||||||||||||||||||||||||
| Net investment income (Note 1) | |||||||||||||||||||||||||||||||||||
| Class R | (5,109,452 | ) | (3,171,710 | ) | (43,969 | ) | (424 | ) | (107,948 | ) | (19,453 | ) | (139,654 | ) | (43,669 | ) | |||||||||||||||||||
| Class Treasurer's Trust | (148 | ) | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
| Total dividends to shareholders | (5,109,600 | ) | (3,171,710 | ) | (43,969 | ) | (424 | ) | (107,948 | ) | (19,453 | ) | (139,654 | ) | (43,669 | ) | |||||||||||||||||||
| Capital share transactions | |||||||||||||||||||||||||||||||||||
| (at net asset value of $1.00 per share): | |||||||||||||||||||||||||||||||||||
| Proceeds from sale of shares | 686,911,548 | 623,924,988 | 9,460,566 | 144,203 | 17,397,774 | 5,086,377 | 34,216,148 | 17,251,908 | |||||||||||||||||||||||||||
| Dividends reinvested | 4,847,554 | 3,096,494 | 43,354 | 424 | 104,723 | 18,742 | 127,526 | 42,321 | |||||||||||||||||||||||||||
| Cost of shares redeemed | (599,707,423 | ) | (605,490,832 | ) | (9,114,722 | ) | (11,525 | ) | (13,658,797 | ) | (4,658,680 | ) | (32,590,280 | ) | (15,586,533 | ) | |||||||||||||||||||
| 92,051,679 | 21,530,650 | 389,198 | 133,102 | 3,843,700 | 446,439 | 1,753,394 | 1,707,696 | ||||||||||||||||||||||||||||
| Net increase in net assets | 92,051,679 | 21,530,650 | 389,198 | 133,102 | 3,843,700 | 446,439 | 1,753,394 | 1,707,696 | |||||||||||||||||||||||||||
| Net Assets: | |||||||||||||||||||||||||||||||||||
| Beginning of year | 185,953,620 | 164,422,970 | 133,102 | — | 739,624 | 293,185 | 3,112,335 | 1,404,639 | |||||||||||||||||||||||||||
| End of year | $ | 278,005,299 | $ | 185,953,620 | $ | 522,300 | $ | 133,102 | $ | 4,583,324 | $ | 739,624 | $ | 4,865,729 | $ | 3,112,335 | |||||||||||||||||||
** The Arizona Municipal Money-Market Fund commenced operation on April 13, 2006.
See notes to financial statements.
29
NOTES TO FINANCIAL STATEMENTS
(1) Significant Accounting Policies:
Reserve New York Municipal Money-Market Trust, Reserve Municipal Money-Market Trust II and Reserve Municipal Money-Market Trust (collectively, the "Trusts") are registered with the Securities and Exchange Commission ("SEC") under the Investment Company Act of 1940, as amended ("the Investment Company Act"), as open-end management investment companies. The policies summarized below are consistently followed in the preparation of each Trust's financial statements in conformity with U.S. generally accepted accounting principles.
A. The Trusts' authorized shares of beneficial interest are unlimited. As of May 31, 2007, there were eleven (11) separate series of Reserve Municipal Money-Market Trust II authorized (Interstate Tax-Exempt Fund, California Municipal Money-Market Fund, Connecticut Municipal Money-Market Fund, Florida Municipal Money-Market Fund, Massachusetts Municipal Money-Market Fund, Michigan Municipal Money-Market Fund, New Jersey Municipal Money-Market Fund, Ohio Municipal Money-Market Fund, Pennsylvania Municipal Money-Market Fund, Virginia Municipal Money-Market Fund and Interstate II Tax-Exempt Fund (which has not commenced operations)); one (1) series of Reserve New York Municipal Money-Market Trust (New York Municipal Money-Market Fund) and three (3) separate series of Reserve Municipal Money-Market Trust (Arizona Municipal Money-Market Fund, Louisiana Municipal Money-Market Fund and Minnesota Municipal Money-Market Fund) authorized and outstandin g (each a "Fund", and collectively the "Funds"). Funds offer two classes of shares, Class R and Class Treasurer's Trust, except for the Interstate Tax-Exempt Fund, which currently offers eleven classes of shares as follows: Class Institutional, Class 15, Class 20, Class 25, Class 35, Class 45, Class Treasurer's Trust, Class 70, Class 75, Class 95 and Class R, Arizona Municipal Money-Market Fund, which currently offers Class 75, Class R and Class Treasurer's Trust and Florida Tax-Exempt Fund, which currently offers only Class R. As of May 31, 2007, Interstate Tax-Exempt Fund had no Class 20, Class 35 and Class 95 shares outstanding. These financial statements and notes apply to all classes of all above mentioned Funds of all of the Trusts, except for the Interstate II Tax-Exempt Fund.
Prior Fund Name New Fund Name
Reserve Tax–Exempt Trust Reserve Municipal Money-Market Trust II
| • Interstate Tax-Exempt Fund1 • | Interstate Tax-Exempt Fund1 | ||||||
| • California Tax-Exempt Fund • | California Municipal Money-Market Fund | ||||||
| • Connecticut Tax-Exempt Fund • | Connecticut Municipal Money-Market Fund | ||||||
| • Florida Tax-Exempt Fund • | Florida Municipal Money-Market Fund | ||||||
| • Massachusetts Tax-Exempt Fund • | Massachusetts Municipal Money-Market Fund | ||||||
| • Michigan Tax-Exempt Fund • | Michigan Municipal Money-Market Fund | ||||||
| • New Jersey Tax-Exempt Fund • | New Jersey Municipal Money-Market Fund | ||||||
| • Ohio Tax-Exempt Fund • | Ohio Municipal Money-Market Fund | ||||||
| • Pennsylvania Tax-Exempt Fund • | Pennsylvania Municipal Money-Market Fund | ||||||
| • Virginia Tax-Exempt Fund • | Virginia Municipal Money-Market Fund | ||||||
Reserve New York Tax-Exempt Trust Reserve New York Municipal Money Market Trust
| • New York Tax-Exempt Trust • | New York Municipal Money-Market Trust | ||||||
B. Securities are valued at amortized cost, which approximates market value in accordance with Rule 2a-7 under the Investment Company Act. The amortized cost method values a security at cost and assumes a constant amortization to maturity of any discount or premium, irrespective of intervening changes in interest rates or market values using the effective interest method. For purposes of compliance with Rule 2a-7 of the Investment Company Act, and for computing the portfolios' average weighted life to maturity, the maturity of floating or variable rate instruments in which the Funds may invest will be deemed to be for floating rate instruments (1) the notice period required before the Funds are entitled to receive payment of the principal amount of the instrument; and for variable rate instruments the longer of (1) above or (2) the period remaining until the instrument's next rate adjustment.
C. It is each Fund's policy to comply with Subchapter M of the Internal Revenue Code and to distribute all income to its shareholders. Accordingly, no Federal income tax provision is required.
D. Security transactions are recorded on a trade date basis. Interest income is accrued daily, and security premium or discount is amortized or accreted daily using the effective interest method. Investment income and fund level expenses (expenses other than the comprehensive management fee and distribution fee) are allocated on a daily basis to each class based upon the relative proportion of net assets of each class.
1 The Interstate Tax-Exempt Fund did not undergo a name change.
30
NOTES TO FINANCIAL STATEMENTS (Continued)
(1) Significant Accounting Policies (Continued)
E. Net investment income is distributed to shareholders daily and automatically reinvested in additional Fund shares, unless the shareholder has elected in writing to receive cash.
F. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities on the date of the financial statements and the reported amounts of income and expenses during the reporting periods. Actual results could differ from those estimates.
G. During the fiscal year ended May 31, 2007, the Funds incurred overdraft positions with their custodian bank. Any related interest charges are shown in each Fund's statement of operations.
(2) Management Fee and Other Transactions with Affiliates:
Pursuant to an Investment Management Agreement (the "Agreement") between Reserve Management Company, Inc. ("RMCI") and each Trust on behalf of each of its series, RMCI serves as each Fund's Investment Adviser, subject to the policies adopted by the Board of Trustees. Under the Agreement, RMCI is responsible for the supervision of the day-to-day operations, manages each Fund's investments, effects purchases and sales and furnishes other services.The Funds pay RMCI a comprehensive management fee, accrued daily, at an annual rate based on the average daily net assets of each class of the Fund's shares according to the following schedule:
| Class Institutional | 0.12 | % | Class Treasurer's Trust | 0.60 | % | ||||||||||
| Class 15 | 0.15 | % | Class 70 | 0.50 | % | ||||||||||
| Class 20 | 0.20 | % | Class 75 | 0.55 | % | ||||||||||
| Class 25 | 0.25 | % | Class 95 | 0.75 | % | ||||||||||
| Class 35 | 0.35 | % | Class R | 0.80 | % | ||||||||||
| Class 45 | 0.45 | % | |||||||||||||
The comprehensive management fee includes the investment advisory fee, (0.08% of each class's average daily net assets), all administrative and customary operating expenses of each Fund, as well as shareholder liaison services (such as responding to customer inquiries and providing information on their investments), recordkeeping charges, accounting expenses, transfer agent costs and the expenses of preparing, printing and mailing shareholder reports and prospectuses. Excluded from the definition of customary operating expenses are: compensation of Chief Compliance Officer, interest charges, taxes, brokerage fees and commissions, extraordinary legal and accounting fees and other extraordinary expenses, payments under the Trust's Distribution Plan, as defined below, and the fees of the Trustees who are not interested persons, as defined in the Investment Company Act (the "non-interested Trustees"), for which each Fund pays its direct or alloc ated share. The Arizona, Louisiana and Minnesota Municipal Money-Market Funds also pay the state (blue sky) and SEC registration fees applicable to those Funds. For the year ended May 31, 2007, RMCI voluntarily waived a portion of its comprehensive management fee in the amounts listed below:
| Fund | 2007 | ||||||
| Interstate Tax-Exempt Fund | $ | 118,412 | |||||
| California Municipal Money-Market Fund | 4,304 | ||||||
| Connecticut Municipal Money-Market Fund | 14,896 | ||||||
| Florida Municipal Money-Market Fund | 7,165 | ||||||
| Massachusetts Municipal Money-Market Fund | 2,905 | ||||||
| Michigan Municipal Money-Market Fund | 3,259 | ||||||
| New Jersey Municipal Money-Market Fund | 12,358 | ||||||
| Ohio Municipal Money-Market Fund | 2,757 | ||||||
| Pennsylvania Municipal Money-Market Fund | 8,573 | ||||||
| Virginia Municipal Money-Market Fund | 8,943 | ||||||
| New York Municipal Money-Market Fund | 10,159 | ||||||
| Arizona Municipal Money-Market Fund | 1,079 | ||||||
| Louisiana Municipal Money-Market Fund | 1,312 | ||||||
| Minnesota Municipal Money-Market Fund | 13,958 | ||||||
These waivers are voluntary and may be terminated at any time.
Certain Officers and Trustees of the Trusts are also Officers of RMCI.
As of May 31, 2007, RMCI owned 2.5% of the Louisiana and 1.6% of the Minnesota Municipal-Money Market Funds.
From time to time, the Funds may have a concentration of several shareholders holding a significant percentage of shares outstanding. Investment activities of these shareholders could have a material impact on the Fund.
31
NOTES TO FINANCIAL STATEMENTS (Continued)
(2) Management Fee and Other Transactions with Affiliates (Continued)
As of May 31, 2007, please refer to the below chart for Concentration of Ownership:
| Fund Name: | Number of Shareholders: | Percentage of Ownership: | |||||||||
| Interstate Tax-Exempt Fund | 8 | 11%, 7%, 6%, 6%, 6%, 6%, 6%, 5% | |||||||||
| California Municipal Money-Market Fund | 1 | 33% | |||||||||
| Connecticut Municipal Money-Market Fund | 3 | 24%, 17%, 7% | |||||||||
| Florida Municipal Money-Market Fund | 3 | 16%, 15%, 7% | |||||||||
| Massachusetts Municipal Money-Market Fund | 1 | 53% | |||||||||
| Michigan Municipal Money-Market Fund | 3 | 38%, 9%, 6% | |||||||||
| New Jersey Municipal Money-Market Fund | 2 | 28%, 11% | |||||||||
| Ohio Municipal Money-Market Fund | 3 | 27%, 10%, 7% | |||||||||
| Pennsylvania Municipal Money-Market Fund | 3 | 27%, 6%, 5% | |||||||||
| Virginia Municipal Money-Market Fund | 2 | 48%, 7% | |||||||||
| New York Municipal Money-Market Fund | 2 | 14%, 7% | |||||||||
| Arizona Municipal Money-Market Fund | 3 | 43%, 20%, 20% | |||||||||
| Louisiana Municipal Money-Market Fund | 6 | 16%, 8%, 6%, 6%, 5%, 5% | |||||||||
| Minnesota Municipal Money-Market Fund | 5 | 21%, 9%, 9%, 8%, 7% | |||||||||
Distribution Assistance:
The Funds have adopted a Rule 12b-1 Distribution Plan and entered into a Distribution Agreement with Resrv Partners, Inc., an affiliate of RMCI, which allows the Funds to pay fees for certain shareholder services and for expenses related to the sale of its shares for the Funds Class R, Class 95, Class 75 and Class 70 Shares. The rate of distribution expenses may not exceed 0.20% per year of the Classes' average daily net assets.
(3) Concentration of Risk:
Total assets of each Fund in the Trusts include a cash balance that is held in accounts with JPMorgan Chase, the Funds' Custodian.
Each State Fund concentrates investments in municipal obligations of issuers located in the state for which it is named. The municipal obligation market is volatile. Particularly, investments secured by letters of credit or guarantees of banks are subject to the same risks generally associated with investing in the banking industry, such as interest rate risk, credit risk and regulatory developments. Further, there are specific risks associated with investing in a single state. For example, unfavorable political or economic conditions and/or changes in municipal market-related legislation or litigation within the state can significantly affect the financial condition and credit quality of issuers of municipal securities located in that state.
(4) Investment Concentration:
The Funds invest substantially all of their assets in portfolios of tax-exempt obligations issued by states, territories and possessions of the United States and their subdivisions. The issuers' ability to meet their obligations may be affected by economic, regional or political developments. In order to reduce the credit risks associated with such factors, the Funds invest substantially all of their portfolio assets in obligations backed by letters of credit, bond insurance of financial institutions, financial guaranty assurance agencies and/or other credit enhancement arrangements.
32
NOTES TO FINANCIAL STATEMENTS (Continued)
(4) Investment Concentration (Continued)
Interstate Tax-Exempt Fund 94.8%
Letter of Credit
| ABN-AMRO Bank NV | 6.1 | % | KBC Bank N.V. | 2.7 | % | ||||||||||
| Allied Irish Bank, PLC | 0.9 | % | Keybank N.A. | 1.9 | % | ||||||||||
| Bank of America N.A. | 4.4 | % | Krediebank NV, Brussels | 3.8 | % | ||||||||||
| Bank of New York | 0.8 | % | La Salle Bank, N.A. | 5.4 | % | ||||||||||
| Bank of Nova Scotia | 0.1 | % | Landesbank Hessen-Thuerinigen Girozentrale | 0.6 | % | ||||||||||
| Bank of Scotland | 0.6 | % | Lloyds TSB Bank PLC | 1.0 | % | ||||||||||
| Bank One N.A. | 3.3 | % | M&T Bank | 3.1 | % | ||||||||||
| Barclays Bank PLC | 0.8 | % | Natexis Banques Populaires | 0.1 | % | ||||||||||
| Bayerische Landesbank Girozentrale | 0.1 | % | Northern Trust Co. | 0.2 | % | ||||||||||
| BNP Paribas | 1.2 | % | PNC Bank, N.A. | 1.9 | % | ||||||||||
| Calyon Bank | 0.2 | % | Regions Bank | 0.1 | % | ||||||||||
| Citibank, N.A. | 1.8 | % | Royal Bank of Canada, Montreal | 0.4 | % | ||||||||||
| Comerica Bank | 0.3 | % | Societe Generale | 0.3 | % | ||||||||||
| DEPFA Bank, PLC | 1.4 | % | Sovereign Bank FSB | 6.8 | % | ||||||||||
| Dexia Credit Local | 2.3 | % | State Street Bank & Trust Co. | 0.2 | % | ||||||||||
| FHLB | 0.6 | % | Suntrust Bank of Nashville | 3.4 | % | ||||||||||
| Fifth Third Bank | 0.1 | % | US Bank, N.A. | 3.1 | % | ||||||||||
| Fleet Bank | 0.5 | % | Wachovia Bank & TR CO., N.A. | 3.1 | % | ||||||||||
| Fortis Bank | 0.2 | % | Wells Fargo | 0.6 | % | ||||||||||
| Harris Trust & Savings Bank | 0.3 | % | Westdeutsche Landesbank Girozentrale | 4.7 | % | ||||||||||
| Helaba | 0.1 | % | Whitney National Bank | 0.3 | % | ||||||||||
| JPMorganChase Bank | 1.1 | % | |||||||||||||
* Bond Insurance
| AMBAC | 8.6 | % | FRMC | 2.1 | % | ||||||||||
| FGIC | 4.6 | % | FSA | 4.0 | % | ||||||||||
| FNMA | 3.4 | % | MBIA | 1.2 | % | ||||||||||
California Municipal Money-Market Fund 99.1%
Letter of Credit
| Allied Irish Bank, PLC | 1.6 | % | HSBC Bank USA N.A. | 2.5 | % | ||||||||||
| Bank of America N.A. | 3.0 | % | JPMorganChase Bank | 3.5 | % | ||||||||||
| Bank of Nova Scotia | 3.8 | % | KBC Bank N.V. | 5.8 | % | ||||||||||
| Bank One N.A. | 1.9 | % | La Salle Bank, N.A. | 4.8 | % | ||||||||||
| Bayerische Landesbank Girozentrale | 6.3 | % | Lloyds TSB Bank PLC | 5.2 | % | ||||||||||
| BNP Paribas | 7.5 | % | Societe Generale | 2.3 | % | ||||||||||
| Calyon Bank | 3.8 | % | Sovereign Bank FSB | 3.7 | % | ||||||||||
| Citibank, N.A. | 4.6 | % | State Street Bank & Trust Co. | 5.5 | % | ||||||||||
| Comerica Bank | 1.9 | % | Wachovia Bank N.A. | 1.6 | % | ||||||||||
| Fortis Bank | 2.2 | % | Wells Fargo Bank N.A. | 2.7 | % | ||||||||||
* Bond Insurance
| AMBAC | 3.1 | % | FRMC | 3.7 | % | ||||||||||
| FGIC | 3.6 | % | FSA | 5.5 | % | ||||||||||
| FNMA | 2.8 | % | MBIA | 6.2 | % | ||||||||||
33
NOTES TO FINANCIAL STATEMENTS (Continued)
(4) Investment Concentration (Continued)
Connecticut Municipal Money-Market Fund 57.7%
Letter of Credit
| Allied Irish Bank, PLC | 4.5 | % | JPMorganChase Bank | 4.8 | % | ||||||||||
| Bank of America N.A. | 4.1 | % | La Salle Bank, N.A. | 5.9 | % | ||||||||||
| Bank of Montreal | 8.8 | % | Wachovia Bank N.A. | 3.3 | % | ||||||||||
* Bond Insurance
| AMBAC | 9.4 | % | FSA | 4.3 | % | ||||||||||
| FGIC | 7.7 | % | MBIA | 4.9 | % | ||||||||||
Florida Municipal Money-Market Fund 93.1%
Letter of Credit
| Bank of America N.A. | 6.6 | % | La Salle Bank, N.A. | 7.2 | % | ||||||||||
| BNP Paribas | 7.3 | % | Northern Trust Co. | 5.3 | % | ||||||||||
| Citibank, N.A. | 7.6 | % | Societe Generale | 3.9 | % | ||||||||||
| First Union National Bank | 1.2 | % | State Street Bank & Trust Co. | 6.6 | % | ||||||||||
| HSBC Bank USA N.A. | 2.5 | % | Suntrust Bank | 6.8 | % | ||||||||||
| JPMorganChase Bank | 1.4 | % | Wachovia Bank N.A. | 3.7 | % | ||||||||||
| Keybank N.A. | 5.2 | % | Wells Fargo | 2.7 | % | ||||||||||
* Bond Insurance
| AMBAC | 7.7 | % | FRMC | 3.4 | % | ||||||||||
| FGIC | 7.5 | % | FSA | 4.6 | % | ||||||||||
| FNMA | 0.4 | % | MBIA | 1.5 | % | ||||||||||
Massachusetts Municipal Money-Market Fund 77.2%
Letter of Credit
| Allied Irish Banks, PLC | 3.7 | % | La Salle Bank, N.A. | 9.0 | % | ||||||||||
| Bank North N.A. | 2.5 | % | Landesbank Hessen-Thuerinigen Girozentrale | 4.1 | % | ||||||||||
| Depfa Bank, PLC | 2.5 | % | Sovereign Bank FSB | 12.6 | % | ||||||||||
| Fleet National Bank | 8.6 | % | State Street Bank & Trust Co. | 1.4 | % | ||||||||||
| KBC Bank N.V. | 8.6 | % | Wachovia Bank N.A. | 3.3 | % | ||||||||||
* Bond Insurance
| AMBAC | 3.8 | % | FSA | 6.8 | % | ||||||||||
| FGIC | 4.5 | % | MBIA | 5.8 | % | ||||||||||
Michigan Municipal Money-Market Fund 98.0%
Letter of Credit
| Bank of New York | 6.8 | % | JPMorganChase Bank | 7.2 | % | ||||||||||
| Bank One N.A. | 1.8 | % | La Salle Bank, N.A. | 7.7 | % | ||||||||||
| Barclays Bank PLC | 3.4 | % | Landesbank Hessen-Thuerinigen Girozentrale | 7.8 | % | ||||||||||
| Comerica Bank | 9.0 | % | National City Bank | 1.7 | % | ||||||||||
| Depfa Bank PLC | 5.7 | % | Sovereign Bank FSB | 7.3 | % | ||||||||||
| Deutsche Bank | 0.6 | % | Standard Federal Bank, N.A. | 5.1 | % | ||||||||||
| FHLB | 8.8 | % | Wachovia Bank N.A. | 3.0 | % | ||||||||||
| Fifth Third Bank | 7.6 | % | |||||||||||||
* Bond Insurance
| AMBAC | 2.7 | % | FSA | 4.8 | % | ||||||||||
| FGIC | 2.4 | % | MBIA | 4.6 | % | ||||||||||
34
NOTES TO FINANCIAL STATEMENTS (Continued)
(4) Investment Concentration (Continued)
New Jersey Municipal Money-Market Fund 87.6%
Letter of Credit
| Allied Irish Bank, PLC | 2.1 | % | JPMorganChase Bank | 3.4 | % | ||||||||||
| Bank of New York | 5.1 | % | KBC Bank N.V. | 0.6 | % | ||||||||||
| Bank of Nova Scotia | 4.8 | % | Lloyds TSB Bank PLC | 2.5 | % | ||||||||||
| Bayerische Landesbank Girozentrale | 3.1 | % | PNC Bank, N.A. | 3.8 | % | ||||||||||
| Chase Manhattan Bank | 6.0 | % | Societe Generale | 2.0 | % | ||||||||||
| Citibank, N.A. | 3.3 | % | Sovereign Bank FSB | 5.1 | % | ||||||||||
| Dexia Credit Local | 2.1 | % | Suntrust Bank | 3.3 | % | ||||||||||
| Fleet National Bank | 4.7 | % | Wachovia Bank N.A. | 9.6 | % | ||||||||||
* Bond Insurance
| AMBAC | 8.3 | % | MBIA | 8.0 | % | ||||||||||
| FSA | 9.8 | % | |||||||||||||
Ohio Municipal Money-Market Fund 92.7%
Letter of Credit
| Allied Irish Bank, PLC | 8.6 | % | La Salle Bank, N.A. | 16.7 | % | ||||||||||
| Bank of America, N.A. | 3.1 | % | Marine Midland Bank | 2.2 | % | ||||||||||
| Bank of Scotland | 5.7 | % | National City Bank | 0.6 | % | ||||||||||
| Bank One ColumbusN.A. | 3.4 | % | Sovereign Bank FSB | 5.2 | % | ||||||||||
| Barclays Bank PLC | 4.4 | % | US Bank N.A. | 6.0 | % | ||||||||||
| Citibank, N.A. | 3.0 | % | Wachovia Bank N.A. | 9.7 | % | ||||||||||
| Fifth Third Bank | 4.0 | % | Wells Fargo Bank N.A. | 2.2 | % | ||||||||||
| Keybank N.A. | 8.2 | % | Westdeutsche Landesbank Girozentrale | 2.3 | % | ||||||||||
* Bond Insurance
| AMBAC | 3.4 | % | MBIA | 4.0 | % | ||||||||||
Pennsylvania Municipal Money-Market Fund 91.2%
Letter of Credit
| ABN-AMRO Bank NV | 7.3 | % | Fleet National Bank | 2.1 | % | ||||||||||
| Allied Irish Bank, PLC | 4.5 | % | KBC Bank N.V. | 4.5 | % | ||||||||||
| Bank of America N.A. | 7.4 | % | Landesbank Hessen-Thuerinigen Girozentrale | 7.1 | % | ||||||||||
| Bank One N.A. | 1.3 | % | Morgan Guaranty Trust | 5.0 | % | ||||||||||
| Barclays Bank PLC | 3.2 | % | Northern Trust Co. | 5.9 | % | ||||||||||
| Bayerische Landesbank Girozentrale | 4.1 | % | PNC Bank, N.A. | 3.8 | % | ||||||||||
| Comerica Bank | 3.1 | % | Sovereign Bank FSB | 3.8 | % | ||||||||||
| Depfa Bank, PLC | 6.9 | % | Wachovia Bank N.A. | 5.4 | % | ||||||||||
| Dexia Credit Local | 1.9 | % | |||||||||||||
* Bond Insurance
| AMBAC | 6.5 | % | FSA | 2.1 | % | ||||||||||
| FNMA | 5.3 | % | |||||||||||||
35
NOTES TO FINANCIAL STATEMENTS (Continued)
(4) Investment Concentration (Continued)
Virginia Municipal Money-Market Fund 86.7%
Letter of Credit
| Bank of America N.A. | 7.6 | % | Suntrust Bank | 9.5 | % | ||||||||||
| BB&T N.A. | 5.8 | % | US Bank N.A. | 7.9 | % | ||||||||||
| Citibank, N.A. | 9.3 | % | Wachovia Bank N.A. | 5.9 | % | ||||||||||
| JP Morgan/ Chase | 9.5 | % | |||||||||||||
* Bond Insurance
| AMBAC | 9.7 | % | FSA | 7.5 | % | ||||||||||
| FRMC | 4.6 | % | MBIA | 9.4 | % | ||||||||||
New York Municipal Money-Market Fund 77.4%
Letter of Credit
| Allied Irish Bank, PLC | 1.7 | % | HSBC Bank USA N.A. | 2.8 | % | ||||||||||
| Bank of America N.A. | 1.3 | % | ING Bank NV | 2.8 | % | ||||||||||
| Bank of New York | 7.4 | % | JP Morgan Chase | 2.6 | % | ||||||||||
| Bank of Nova Scotia | 3.2 | % | Keybank N.A. | 1.3 | % | ||||||||||
| Bayerische Landesbank Girozentrale | 0.3 | % | Landesbank Hessen-Thuerinigen Girozentrale | 3.7 | % | ||||||||||
| BNP Paribas | 4.1 | % | Morgan Guaranty Trust | 0.1 | % | ||||||||||
| Chase Manhattan Bank | 1.4 | % | Royal Bank of Scotland | 0.5 | % | ||||||||||
| Citibank, N.A. | 3.4 | % | Societe Generale | 1.2 | % | ||||||||||
| Depfa Bank, PLC | 2.3 | % | Sovereign Bank FSB | 2.5 | % | ||||||||||
| Dexia Credit Local | 2.2 | % | Wachovia Bank N.A. | 1.6 | % | ||||||||||
| Fleet Bank | 2.6 | % | Wells Fargo Bank N.A. | 2.9 | % | ||||||||||
| Fortis Bank | 4.0 | % | Westdeutsche Landesbank Girozentrale | 3.3 | % | ||||||||||
* Bond Insurance
| FGIC | 2.6 | % | FSA | 8.7 | % | ||||||||||
| FNMA | 2.9 | % | MBIA | 1.4 | % | ||||||||||
| FRMC | 2.6 | % | |||||||||||||
Arizona Municipal Money-Market Fund 45.2%
Letter of Credit
| ABN-AMRO Bank NV | 3.4 | % | KBC Bank N.V. | 4.0 | % | ||||||||||
| Bank of America | 4.0 | % | La Salle Bank, N.A. | 4.0 | % | ||||||||||
| Bank of New York | 1.5 | % | Wells Fargo Bank N.A. | 5.3 | % | ||||||||||
| Bank One N.A. | 4.0 | % | |||||||||||||
* Bond Insurance
| AMBAC | 3.4 | % | FRMC | 3.6 | % | ||||||||||
| FGIC | 4.0 | % | MBIA | 4.0 | % | ||||||||||
| FNMA | 4.0 | % | |||||||||||||
36
NOTES TO FINANCIAL STATEMENTS (Continued)
(4) Investment Concentration (Continued)
Louisiana Municipal Money-Market Fund 99.4%
Letter of Credit
| Bank of America N.A. | 2.8 | % | Natexis Banques Populaires | 9.6 | % | ||||||||||
| Bank of New York | 9.6 | % | Regions Bank | 9.6 | % | ||||||||||
| Bank One Louisiana N.A. | 2.2 | % | Wachovia Bank | 9.4 | % | ||||||||||
| Bay LandesBank Girozentrale | 9.6 | % | Whitney National Bank | 7.5 | % | ||||||||||
* Bond Insurance
| AMBAC | 9.3 | % | FSA | 9.6 | % | ||||||||||
| FGIC | 9.4 | % | MBIA | 8.6 | % | ||||||||||
| FNMA | 2.2 | % | |||||||||||||
Minnesota Municipal Money-Market Fund 75.0%
Letter of Credit
| Allied Irish Bank, PLC | 2.7 | % | La Salle Bank, N.A. | 7.9 | % | ||||||||||
| Dexia Bank | 4.3 | % | US Bank N.A. | 6.0 | % | ||||||||||
| Harris Trust & Savings Bank | 11.7 | % | Wells Fargo Bank N.A. | 2.7 | % | ||||||||||
* Bond Insurance
| AMBAC | 11.7 | % | FRMC | 11.6 | % | ||||||||||
| FNMA | 9.2 | % | MBIA | 7.2 | % | ||||||||||
*Some securities may be backed by both a letter of credit and bond insurance.
(5) Composition of Net Assets:
At May 31, 2007, the composition of each Fund's net assets was as follows:
| Interstate Fund | California Fund | Connecticut Fund | Florida Fund | Massachusetts Fund | |||||||||||||||||||
| Par Value | $ | 823,772 | $ | 133,540 | $ | 46,578 | $ | 73,596 | $ | 24,403 | |||||||||||||
| Additional-Paid-in-Capital | 822,948,666 | 133,406,036 | 46,531,559 | 73,522,087 | 24,378,877 | ||||||||||||||||||
| Accumulated Net Realized Loss | (27,786 | ) | — | — | — | — | |||||||||||||||||
| Net Assets | $ | 823,744,652 | $ | 133,539,576 | $ | 46,578,137 | $ | 73,595,683 | $ | 24,403,280 | |||||||||||||
| Michigan Fund | New Jersey Fund | Ohio Fund | Pennsylvania Fund | Virginia Fund | |||||||||||||||||||
| Par Value | $ | 16,541 | $ | 90,628 | $ | 17,408 | $ | 52,358 | $ | 25,754 | |||||||||||||
| Additional-Paid-in-Capital | 16,524,292 | 90,537,522 | 17,390,560 | 52,305,930 | 25,728,255 | ||||||||||||||||||
| Net Assets | $ | 16,540,833 | $ | 90,628,150 | $ | 17,407,968 | $ | 52,358,288 | $ | 25,754,009 | |||||||||||||
| New York Fund | Arizona Fund | Louisiana Fund | Minnesota Fund | ||||||||||||||||
| Par Value | $ | 278,005 | $ | 52 | $ | 458 | $ | 487 | |||||||||||
| Additional-Paid-in-Capital | 277,727,294 | 522,248 | 4,582,866 | 4,865,242 | |||||||||||||||
| Net Assets | $ | 278,005,299 | $ | 522,300 | $ | 4,583,324 | $ | 4,865,729 | |||||||||||
The tax basis of each Fund's assets is the same as the basis for financial reporting at May 31, 2007. There was no undistributed net investment income for any of the Funds at May 31, 2007. All dividends paid during the year ended May 31, 2007 were federally tax-exempt dividends except for dividends paid by Arizona Municipal Money-Market Fund of $43,969 which were classified as ordinary income for federal income tax purposes. Interstate Tax-Exempt Fund intends to defer post October capital losses of $27,786 to fiscal year ending May 31, 2007. Such losses if utilized will expire in 2016.
37
NOTES TO FINANCIAL STATEMENTS (Continued)
(5) Composition of Net Assets (Continued)
The income dividends were classified as tax-exempt income for federal income tax purposes for the years shown below:
| 2007 | 2006 | ||||||||||
| Interstate Tax-Exempt Fund | $ | 35,120,315 | $ | 28,396,150 | |||||||
| California Municipal Money-Market Fund | 3,494,300 | 2,047,962 | |||||||||
| Connecticut Municipal Money-Market Fund | 824,146 | 461,210 | |||||||||
| Florida Municipal Money-Market Fund | 1,474,751 | 940,891 | |||||||||
| Massachusetts Municipal Money-Market Fund | 676,333 | 401,405 | |||||||||
| Michigan Municipal Money-Market Fund | 357,742 | 267,391 | |||||||||
| New Jersey Municipal Money-Market Fund | 1,582,353 | 929,631 | |||||||||
| Ohio Municipal Money-Market Fund | 455,135 | 352,023 | |||||||||
| Pennsylvania Municipal Money-Market Fund | 1,547,755 | 823,497 | |||||||||
| Virginia Municipal Money-Market Fund | 587,762 | 306,255 | |||||||||
| New York Municipal Money-Market Fund | 5,109,600 | 3,171,710 | |||||||||
| Arizona Municipal Money-Market Fund | 0 | 424 | |||||||||
| Louisiana Municipal Money-Market Fund | 107,948 | 19,453 | |||||||||
| Minnesota Municipal Money-Market Fund | 139,654 | 43,669 | |||||||||
(6) Capital Share Transactions:
For the years ended May 31, 2007 and May 31, 2006, the capital share transactions of each class of the Interstate Tax-Exempt Fund, each at a net asset value of $1 per share, were as follows:
| Year Ended May 31, 2007 | |||||||||||||||||||||||||||
| Class R | Class Treasurer's Trust | Class 75 | Class 70 | Class 45 | Class 25 | ||||||||||||||||||||||
| Sold | 1,309,381,602 | 1,017,223,239 | 29,868,656 | 55,931,680 | 2,025,955 | 125,300,797 | |||||||||||||||||||||
| Reinvested | 7,643,589 | 1,840,244 | 151,872 | 107,035 | 10,718 | 1,597,526 | |||||||||||||||||||||
| Redeemed | (1,282,983,301 | ) | (962,993,695 | ) | (31,281,010 | ) | (49,690,690 | ) | (1,821,973 | ) | (147,516,216 | ) | |||||||||||||||
| Net Increase (Decrease) | 34,041,890 | 56,069,788 | (1,260,482 | ) | 6,348,025 | 214,700 | (20,617,893 | ) | |||||||||||||||||||
| Class 15 | Class Institutional*# | Class 8*# (Unaudited) | |||||||||||||
| Sold | 31 | 7,272,005,587 | 2,801,924,081 | ||||||||||||
| Reinvested | 3,696 | 15,251,180 | 6,309,677 | ||||||||||||
| Redeemed | (31 | ) | (6,936,822,169 | ) | (3,618,972,892 | ) | |||||||||
| Net Increase (Decrease) | 3,696 | 350,434,598 | (810,739,134 | ) | |||||||||||
38
NOTES TO FINANCIAL STATEMENTS (Continued)
(6) Capital Share Transactions (Continued)
| Year Ended May 31, 2006 | |||||||||||||||||||||||||||
| Class R | Class Treasurer's Trust | Class 75 | Class 70 | Class 45 | Class 25 | ||||||||||||||||||||||
| Sold | 1,193,940,109 | 450,122,707 | 10,116,006 | 175,463,902 | 1,899,359 | 153,302,998 | |||||||||||||||||||||
| Reinvested | 5,070,615 | 885,658 | 22,962 | 41,004 | 6,187 | 870,076 | |||||||||||||||||||||
| Redeemed | (1,174,903,920 | ) | (459,064,686 | ) | (3,782,324 | ) | (173,801,732 | ) | (1,713,687 | ) | (168,877,105 | ) | |||||||||||||||
| Net Increase (Decrease) | 24,106,804 | (8,056,321 | ) | 6,356,644 | 1,703,174 | 191,859 | (14,704,031 | ) | |||||||||||||||||||
| Class 15 | Class Institutional* | Class 8* | |||||||||||||
| Sold | 513 | 3 | 12,642,518,069 | ||||||||||||
| Reinvested | 2,780 | 275 | 17,924,944 | ||||||||||||
| Redeemed | (513 | ) | (1 | ) | (12,873,088,700 | ) | |||||||||
| Net Increase (Decrease) | 2,780 | 277 | (212,645,687 | ) | |||||||||||
For the year ended May 31, 2007, the capital share transactions of each class of the New York Municipal Money-Market Fund, each at a net asset value of $1 per share, were as follows:
| Year Ended May 31, 2007 | Period Ended May 31, 2007** | ||||||||||
| Class R | Class Treasurer's Trust | ||||||||||
| Sold | 686,901,533 | 10,015 | |||||||||
| Reinvested | 4,847,434 | 120 | |||||||||
| Redeemed | (599,707,436 | ) | 13 | ||||||||
| Net Increase (Decrease) | 92,041,531 | 10,148 | |||||||||
* Effective September 1, 2006, Class 12 was renamed Class Institutional, and Class 8 is no longer being offered.
** Class Treasurer's Trust commenced operations on December 7, 2006.
# Includes transfer from Class 8 to Class Institutional.
39
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights:
Contained below is per share operating performance data for a share of beneficial interest outstanding for each of the periods as indicated.
| Class R | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Interstate Tax-Exempt Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0259 | 0.0182 | 0.0070 | 0.0010 | 0.0034 | ||||||||||||||||||
| Dividends from net investment income | (0.0259 | ) | (0.0182 | ) | (0.0070 | ) | (0.0010 | ) | (0.0034 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.62 | % | 1.84 | % | 0.70 | % | 0.10 | % | 0.34 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 319.6 | $ | 285.5 | $ | 261.4 | $ | 283.5 | $ | 280.4 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.01 | % | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 1.00 | % | 1.00 | % | 1.00 | % | 0.90 | % | 0.99 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.59 | % | 1.85 | % | 0.69 | % | 0.10 | % | 0.33 | % | |||||||||||||
| Class Treasurer's Trust | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Interstate Tax-Exempt Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0299 | 0.0222 | 0.0109 | 0.0040 | 0.0074 | ||||||||||||||||||
| Dividends from net investment income | (0.0299 | ) | (0.0222 | ) | (0.0109 | ) | (0.0040 | ) | (0.0074 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 3.04 | % | 2.25 | % | 1.10 | % | 0.40 | % | 0.74 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 96.7 | $ | 40.7 | $ | 48.7 | $ | 22.5 | $ | 29.2 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 0.61 | % | 0.60 | % | 0.60 | % | 0.60 | % | 0.60 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.60 | % | 0.60 | % | (b) | (b) | (b) | ||||||||||||||||
| Ratio of net investment income to average net assets | 3.01 | % | 2.25 | % | 1.24 | % | 0.37 | % | 0.71 | % | |||||||||||||
40
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class 75 | Class 70 | ||||||||||||||||||||||||||
| Year Ended May 31, | September 23, 2004* to May 31, | Year Ended May 31, | August 16, 2004* to May 31, | ||||||||||||||||||||||||
| Interstate Tax-Exempt Fund | 2007 | 2006 | 2005 | 2007 | 2006 | 2005 | |||||||||||||||||||||
| Net asset value at beginning of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||||
| Net investment income | 0.0284 | 0.0207 | 0.0083 | 0.0289 | 0.0212 | 0.0092 | |||||||||||||||||||||
| Dividends from net investment income | (0.0284 | ) | (0.0207 | ) | (0.0083 | ) | (0.0289 | ) | (0.0212 | ) | (0.0092 | ) | |||||||||||||||
| Net asset value at end of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||||
| Total Return | 2.88 | % | 2.09 | % | 0.83 | % | 2.93 | % | 2.15 | % | 0.93 | % | |||||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||||||
| Net assets end of period (millions) | $ | 5.1 | $ | 6.4 | $ | — | ^ | $ | 9.0 | $ | 2.6 | $ | 0.9 | ||||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 0.76 | % | 0.75 | % | 0.75 | %(a) | 0.71 | % | 0.70 | % | 0.71 | %(a) | |||||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.75 | % | 0.75 | % | (b) | 0.70 | % | 0.70 | % | (b) | |||||||||||||||||
| Ratio of net investment income to average net assets | 2.83 | % | 2.67 | % | 1.60 | %(a) | 2.92 | % | 2.12 | % | 1.10 | %(a) | |||||||||||||||
| Class 45 | |||||||||||||||||||
| August 7, 2004* to | |||||||||||||||||||
| Years Ended May 31, | May 31, | ||||||||||||||||||
| Interstate Tax-Exempt Fund | 2007 | 2006 | 2005 | 2004 | |||||||||||||||
| Net asset value at beginning of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||
| Net investment income | 0.0314 | 0.0237 | 0.0123 | 0.0044 | |||||||||||||||
| Dividends from net investment income | (0.0314 | ) | (0.0237 | ) | (0.0123 | ) | (0.0044 | ) | |||||||||||
| Net asset value at end of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||
| Total Return | 3.19 | % | 2.40 | % | 1.25 | % | 0.45 | % | |||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||
| Net assets end of period (millions) | $ | 0.5 | $ | 0.30 | $ | 0.10 | $ | — | ^ | ||||||||||
| Ratio of expenses to average net assets, before fee waivers | 0.46 | % | 0.45 | % | 0.46 | % | 0.44 | %(a) | |||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.45 | % | 0.45 | % | (b) | (b) | |||||||||||||
| Ratio of net investment income to average net assets | 3.14 | % | 2.46 | % | 1.37 | % | 0.55 | %(a) | |||||||||||
41
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class 25 | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Interstate Tax-Exempt Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0334 | 0.0257 | 0.0144 | 0.0075 | 0.0109 | ||||||||||||||||||
| Dividends from net investment income | (0.0334 | ) | (0.0257 | ) | (0.0144 | ) | (0.0075 | ) | (0.0109 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 3.40 | % | 2.61 | % | 1.46 | % | 0.75 | % | 1.09 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 42.4 | $ | 63.0 | $ | 77.7 | $ | 15.9 | $ | 17.8 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 0.26 | % | 0.25 | % | 0.25 | % | 0.25 | % | 0.25 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.25 | % | 0.25 | % | (b) | (b) | (b) | ||||||||||||||||
| Ratio of net investment income to average net assets | 3.33 | % | 2.50 | % | 1.76 | % | 0.74 | % | 1.07 | % | |||||||||||||
| Class 15 | |||||||||||||||||||||||
| January 13, 2003* to | |||||||||||||||||||||||
| Years Ended May 31, | May 31, | ||||||||||||||||||||||
| Interstate Tax-Exempt Fund | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||
| Net asset value at beginning of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0344 | 0.0267 | 0.0154 | 0.0085 | 0.0039 | ||||||||||||||||||
| Dividends from net investment income | (0.0344 | ) | (0.0267 | ) | (0.0154 | ) | (0.0085 | ) | (0.0039 | ) | |||||||||||||
| Net asset value at end of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 3.50 | % | 2.71 | % | 1.56 | % | 0.86 | % | 0.39 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of period (millions) | $ | 0.1 | $ | 0.1 | $ | 0.10 | $ | 0.1 | $ | 0.1 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 0.16 | % | 0.15 | % | 0.16 | % | 0.15 | % | 0.15 | %(a) | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.15 | % | 0.15 | % | (b) | (b) | (b) | ||||||||||||||||
| Ratio of net investment income to average net assets | 3.44 | % | 2.55 | % | 1.54 | % | 0.85 | % | 1.03 | %(a) | |||||||||||||
42
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class Institutional*** | |||||||||||||||
| Years Ended May 31, | February 1, 2005* to May 31, | ||||||||||||||
| Interstate Tax-Exempt Fund | 2007 | 2006 | 2005 | ||||||||||||
| Net asset value at beginning of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||
| Net investment income | 0.0348 | 0.0271 | 0.0069 | ||||||||||||
| Dividends from net investment income | (0.0348 | ) | (0.0271 | ) | (0.0069 | ) | |||||||||
| Net asset value at end of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||
| Total Return | 3.55 | % | 2.75 | % | 0.70 | % | |||||||||
| Ratios/Supplemental Data | |||||||||||||||
| Net assets end of period (millions) | $ | 350.4 | $ | 0.0 | $ | — | ^ | ||||||||
| Ratio of expenses to average net assets, before fee waivers | 0.13 | % | 0.12 | % | 0.12 | %(a) | |||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.11 | % | 0.12 | % | (b) | ||||||||||
| Ratio of net investment income to average net assets | 3.51 | % | 2.73 | % | 2.12 | %(a) | |||||||||
| Class 8 (Unaudited)*** | |||||||||||||||||||||||
| January 13, 2003* to | |||||||||||||||||||||||
| Years Ended May 31, | May 31, | ||||||||||||||||||||||
| Interstate Tax-Exempt Fund | 2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0087 | 0.0274 | 0.0161 | 0.0092 | 0.0042 | ||||||||||||||||||
| Dividends from net investment income | (0.0087 | ) | (0.0274 | ) | (0.0161 | ) | (0.0092 | ) | (0.0042 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 0.87 | % | 2.78 | % | 1.64 | % | 0.93 | % | 0.42 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | — | $ | 810.7 | $ | 1,023.4 | $ | 66.2 | $ | 0.1 | |||||||||||||
| Ratio of expenses to average net assets | 0.09 | % | 0.08 | % | 0.08 | % | 0.08 | % | 0.08 | %(a) | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.08 | % | 0.08 | % | (b) | (b) | (b) | ||||||||||||||||
| Ratio of net investment income to average net assets | 3.49 | % | 2.73 | % | 1.80 | % | 0.92 | % | 1.10 | %(a) | |||||||||||||
43
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| California Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0250 | 0.0177 | 0.0068 | 0.0006 | 0.0033 | ||||||||||||||||||
| Dividends from net investment income | (0.0250 | ) | (0.0177 | ) | (0.0068 | ) | (0.0006 | ) | (0.0033 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.53 | % | 1.79 | % | 0.69 | % | 0.06 | % | 0.33 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 133.5 | $ | 124.1 | $ | 105.2 | $ | 101.2 | $ | 109.0 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 1.00 | % | 1.00 | % | 1.00 | % | 0.89 | % | 0.99 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.50 | % | 1.80 | % | 0.69 | % | 0.06 | % | 0.32 | % | |||||||||||||
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Connecticut Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0259 | 0.0179 | 0.0068 | 0.0006 | 0.0025 | ||||||||||||||||||
| Dividends from net investment income | (0.0259 | ) | (0.0179 | ) | (0.0068 | ) | (0.0006 | ) | (0.0025 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.63 | % | 1.81 | % | 0.68 | % | 0.06 | % | 0.25 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 46.6 | $ | 27.3 | $ | 23.4 | $ | 21.5 | $ | 36.4 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.01 | % | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.96 | % | 0.99 | % | 1.00 | % | 0.86 | % | 0.98 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.60 | % | 1.79 | % | 0.68 | % | 0.06 | % | 0.25 | % | |||||||||||||
44
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Florida Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0261 | 0.0185 | 0.0072 | 0.0006 | 0.0036 | ||||||||||||||||||
| Dividends from net investment income | (0.0261 | ) | (0.0185 | ) | (0.0072 | ) | (0.0006 | ) | (0.0036 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.64 | % | 1.86 | % | 0.73 | % | 0.06 | % | 0.36 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 73.6 | $ | 55.1 | $ | 43.1 | $ | 39.5 | $ | 45.9 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.01 | % | 1.01 | % | 1.00 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.99 | % | 1.00 | % | 1.00 | % | 0.91 | % | 0.99 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.62 | % | 1.88 | % | 0.74 | % | 0.06 | % | 0.35 | % | |||||||||||||
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Massachusetts Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0259 | 0.0181 | 0.0068 | 0.0006 | 0.0030 | ||||||||||||||||||
| Dividends from net investment income | (0.0259 | ) | (0.0181 | ) | (0.0068 | ) | (0.0006 | ) | (0.0030 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | �� | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | ||||||||||||
| Total Return | 2.63 | % | 1.82 | % | 0.68 | % | 0.06 | % | 0.30 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 24.4 | $ | 28.5 | $ | 22.2 | $ | 17.8 | $ | 20.8 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.01 | % | 1.00 | % | 1.01 | % | 1.01 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 1.00 | % | (b) | 1.00 | % | 0.88 | % | 0.98 | % | ||||||||||||||
| Ratio of net investment income to average net assets | 2.59 | % | 1.84 | % | 0.69 | % | 0.06 | % | 0.30 | % | |||||||||||||
45
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Michigan Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0263 | 0.0182 | 0.0069 | 0.0006 | 0.0029 | ||||||||||||||||||
| Dividends from net investment income | (0.0263 | ) | (0.0182 | ) | (0.0069 | ) | (0.0006 | ) | (0.0029 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.66 | % | 1.84 | % | 0.70 | % | 0.06 | % | 0.29 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 16.5 | $ | 16.3 | $ | 16.6 | $ | 12.1 | $ | 7.9 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.01 | % | 1.00 | % | 1.01 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.99 | % | 0.99 | % | 1.00 | % | 0.91 | % | 0.98 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.63 | % | 1.78 | % | 0.77 | % | 0.06 | % | 0.29 | % | |||||||||||||
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| New Jersey Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0257 | 0.0178 | 0.0068 | 0.0006 | 0.0029 | ||||||||||||||||||
| Dividends from net investment income | (0.0257 | ) | (0.0178 | ) | (0.0068 | ) | (0.0006 | ) | (0.0029 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.60 | % | 1.80 | % | 0.68 | % | 0.06 | % | 0.29 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 90.6 | $ | 54.0 | $ | 45.0 | $ | 50.2 | $ | 56.0 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.01 | % | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.99 | % | 1.00 | % | 0.99 | % | 0.87 | % | 0.97 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.62 | % | 1.81 | % | 0.66 | % | 0.06 | % | 0.28 | % | |||||||||||||
46
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Ohio Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0261 | 0.0184 | 0.0071 | 0.0006 | 0.0030 | ||||||||||||||||||
| Dividends from net investment income | (0.0261 | ) | (0.0184 | ) | (0.0071 | ) | (0.0006 | ) | (0.0030 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.65 | % | 1.86 | % | 0.71 | % | 0.06 | % | 0.30 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 17.4 | $ | 18.7 | $ | 19.0 | $ | 10.9 | $ | 10.4 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.02 | % | 1.00 | % | 1.00 | % | 1.01 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 1.00 | % | 1.00 | % | 1.00 | % | 0.92 | % | 0.99 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.61 | % | 1.83 | % | 0.79 | % | 0.06 | % | 0.29 | % | |||||||||||||
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Pennsylvania Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0263 | 0.0186 | 0.0070 | 0.0007 | 0.0036 | ||||||||||||||||||
| Dividends from net investment income | (0.0263 | ) | (0.0186 | ) | (0.0070 | ) | (0.0007 | ) | (0.0036 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.67 | % | 1.88 | % | 0.70 | % | 0.07 | % | 0.36 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 52.4 | $ | 48.9 | $ | 44.7 | $ | 46.1 | $ | 40.6 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.02 | % | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 1.00 | % | 0.99 | % | 1.00 | % | 0.93 | % | 1.00 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.63 | % | 1.87 | % | 0.70 | % | 0.07 | % | 0.34 | % | |||||||||||||
47
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Virginia Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0260 | 0.0181 | 0.0067 | 0.0006 | 0.0025 | ||||||||||||||||||
| Dividends from net investment income | (0.0260 | ) | (0.0181 | ) | (0.0067 | ) | (0.0006 | ) | (0.0025 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.64 | % | 1.82 | % | 0.67 | % | 0.06 | % | 0.25 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 25.8 | $ | 20.7 | $ | 13.7 | $ | 11.0 | $ | 11.3 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.01 | % | 1.00 | % | 1.00 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.97 | % | 0.91 | % | 1.00 | % | 0.90 | % | 0.95 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.61 | % | 1.88 | % | 0.70 | % | 0.06 | % | 0.24 | % | |||||||||||||
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| New York Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0258 | 0.0176 | 0.0067 | 0.0006 | 0.0034 | ||||||||||||||||||
| Dividends from net investment income | (0.0258 | ) | (0.0176 | ) | (0.0067 | ) | (0.0006 | ) | (0.0034 | ) | |||||||||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.62 | % | 1.77 | % | 0.67 | % | 0.06 | % | 0.34 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of year (millions) | $ | 278.0 | $ | 185.9 | $ | 164.4 | $ | 172.6 | $ | 228.4 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.00 | % | 1.00 | % | 1.02 | % | 1.02 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 1.00 | % | 1.00 | % | 1.01 | % | 0.89 | % | 0.99 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.59 | % | 1.77 | % | 0.66 | % | 0.06 | % | 0.34 | % | |||||||||||||
48
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class Treasurer's Trust | |||||||
| December 7, 2006* to May 31, 2007 | |||||||
| New York Municipal Money-Market Fund | |||||||
| Net asset value at beginning of period | $ | 1.0000 | |||||
| Net investment income | 0.0147 | ||||||
| Dividends from net investment income | (0.0147 | ) | |||||
| Net asset value at end of period | $ | 1.0000 | |||||
| Total Return | 1.48 | % | |||||
| Ratios/Supplemental Data | |||||||
| Net assets end of period (millions) | $ | — | ^ | ||||
| Ratio of expenses to average net assets, before fee waivers | 0.62 | %(a) | |||||
| Ratio of expenses to average net assets net of fee waivers | 0.62 | %(a) | |||||
| Ratio of net investment income to average net assets | 3.06 | %(a) | |||||
| Class R** | |||||||||||
| Years Ended May 31, 2007 | April 3, 2006* to May 31, 2006 | ||||||||||
| Arizona Municipal Money-Market Fund | |||||||||||
| Net asset value at beginning of year | $ | 1.0000 | $ | 1.0000 | |||||||
| Net investment income | 0.0262 | 0.0039 | |||||||||
| Dividends from net investment income | (0.0262 | ) | (0.0039 | ) | |||||||
| Net asset value at end of year | $ | 1.0000 | $ | 1.0000 | |||||||
| Total Return | 2.65 | % | 0.39 | % | |||||||
| Ratios/Supplemental Data | |||||||||||
| Net assets end of year (millions) | $ | 0.5 | $ | 0.1 | |||||||
| Ratio of expenses to average net assets, before fee waivers | 1.02 | % | 1.00 | %(a) | |||||||
| Ratio of expenses to average net assets net of fee waivers | 0.96 | % | 0.92 | %(a) | |||||||
| Ratio of net investment income to average net assets | 2.59 | % | 2.42 | %(a) | |||||||
49
NOTES TO FINANCIAL STATEMENTS (Continued)
(7) Financial Highlights (Continued)
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Louisiana Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0261 | 0.0213 | 0.0065 | 0.0007 | 0.0032 | ||||||||||||||||||
| Dividends from net investment income | (0.0261 | ) | (0.0213 | ) | (0.0065 | ) | (0.0007 | ) | (0.0032 | ) | |||||||||||||
| Net asset value at end of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.65 | % | 2.16 | % | 0.66 | % | 0.07 | % | 0.32 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of period (millions) | $ | 4.6 | $ | 0.7 | $ | 0.3 | $ | 0.2 | $ | 0.1 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.03 | % | 0.99 | % | 1.01 | % | 1.00 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 1.00 | % | 0.52 | % | 1.00 | % | 0.64 | % | 0.57 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.62 | % | 2.33 | % | 0.74 | % | 0.06 | % | 0.32 | % | |||||||||||||
| Class R** | |||||||||||||||||||||||
| Years Ended May 31, | |||||||||||||||||||||||
| 2007 | 2006 | 2005 | 2004 | 2003 | |||||||||||||||||||
| Minnesota Municipal Money-Market Fund | |||||||||||||||||||||||
| Net asset value at beginning of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Net investment income | 0.0265 | 0.0179 | 0.0066 | 0.0006 | 0.0044 | ||||||||||||||||||
| Dividends from net investment income | (0.0265 | ) | (0.0179 | ) | (0.0066 | ) | (0.0006 | ) | (0.0044 | ) | |||||||||||||
| Net asset value at end of period | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | $ | 1.0000 | |||||||||||||
| Total Return | 2.68 | % | 1.80 | % | 0.66 | % | 0.06 | % | 0.44 | % | |||||||||||||
| Ratios/Supplemental Data | |||||||||||||||||||||||
| Net assets end of period (millions) | $ | 4.9 | $ | 3.1 | $ | 1.4 | $ | 0.6 | $ | 0.2 | |||||||||||||
| Ratio of expenses to average net assets, before fee waivers | 1.01 | % | 1.01 | % | 1.00 | % | 1.01 | % | 1.00 | % | |||||||||||||
| Ratio of expenses to average net assets net of fee waivers | 0.75 | % | 0.94 | % | 0.99 | % | 0.78 | % | 0.69 | % | |||||||||||||
| Ratio of net investment income to average net assets | 2.66 | % | 1.88 | % | 0.78 | % | 0.06 | % | 0.43 | % | |||||||||||||
* Inception of Class operations.
(a) Annualized.
(b) As there were no fee waivers during the period, this is not applicable.
^ Amount is less than $50,000.
** Effective November 28, 2006 Single Class was redesignated as Class R.
*** Effective September 1, 2006, Class 12 was renamed Class Institutional and Class 8 is no longer being offered.
50
NOTES TO FINANCIAL STATEMENTS (Continued)
(8) Subsequent Event:
The Board of Trustees and shareholders of each class of each fund, approved an increase in the comprehensive management fee by one basis point (.01 of 1%) and the distribution and service fee by five basis points (.05 of 1%) effective July 16, 2007. In approving new comprehensive management fees, the Board of Trustees and shareholders of each class of each fund approved an amendment to the applicable Investment Management Agreement to exclude from the comprehensive fee the expenses of the services of each fund's chief compliance officer and independent counsel to the independent Trustees. There were no changes in the terms of the Distribution Plans except for the change in fees.
Additionally, the Board of Trustees and shareholders of each of the state specific tax-exempt funds approved changes to each applicable fund's fundamental investment policy to permit a fund to invest in a broader range of municipal securities, including private activity bonds, that may result in a shareholder paying the Federal alternative minimum tax ("AMT"). Due to the change in the investment policy of each fund, such funds have each changed their name to indicate that fund investments may produce taxable income to the extent a shareholder is subject to AMT.
(9) Commitments and Contingencies:
In the normal course of business, the Funds enter into contracts that contain a variety of representations and warranties and provide general indemnifications. The Funds' general exposure under these arrangements is unknown, as this would involve future claims that may be made against the Funds that have not yet occurred. However, based on experience, the Funds expect the risk of loss to be remote.
(10) Recent Accounting Pronouncements:
On July 13, 2006, the FASB released FASB Interpretation No. 48 "Accounting for Uncertainty in Income Taxes" (FIN 48). FIN 48 provides guidance for how uncertain tax positions should be recognized, measured, presented and disclosed in the financial statements. FIN 48 requires the evaluation of tax positions taken or expected to be taken in the course of preparing the Fund's tax returns to determine whether the tax positions are "more-likely-than-not" of being sustained by the applicable tax authority. Tax positions not deemed to meet the more-likely-than-not threshold would be recorded as a tax benefit or expense in the current year. Adoption of FIN 48 is required for fiscal years beginning after December 15, 2006 and is to be applied to all open tax years as of the effective date. Management does not believe the application of this standard will have a material affect on the financial statements of the Funds.
51
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Trustees and Shareholders of Reserve Municipal Money-Market Trust II, Reserve New York Municipal Money-Market Trust and Reserve Municipal Money-Market Trust:
We have audited the accompanying statements of net assets of Interstate Tax-Exempt Fund, California Municipal Money-Market Fund, Florida Municipal Money-Market Fund, Massachusetts Municipal Money-Market Fund, Michigan Municipal Money-Market Fund, Ohio Municipal Money-Market Fund, Pennsylvania Municipal Money-Market Fund, Virginia Municipal Money-Market Fund of the Reserve Municipal Money-Market Trust II, New York Municipal Money-Market Fund of the Reserve New York Municipal Money Market Trust, Louisiana Municipal Money-Market Fund and Minnesota Municipal Money-Market Fund of the Reserve Municipal Money-Market Trust, and the statements of assets and liabilities, including the schedule of investments, of Connecticut Municipal Money-Market Fund, New Jersey Municipal Money-Market Fund of the Reserve Municipal Money-Market Trust II, and Arizona Municipal Money-Market Fund of the Reserve Municipal Money-Market Trust (collectively the Funds), as of May 31, 2007, and the related statements of operations for the year then ended, the statements of changes in net assets and the financial highlights for each of the years or period in the two-year period then ended. 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. The financial highlights for each of the years or periods in the three-year period ended May 31, 2005 were audited by another independent registered public accounting firm whose report dated September 26, 2005 expressed an unqualified opinion on those financial highlights.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). 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 securities owned as of May 31, 2007, by correspondence with custodian. 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 position of Interstate Tax-Exempt Fund, California Municipal Money-Market Fund, Connecticut Municipal Money-Market Fund, Florida Municipal Money-Market Fund, Massachusetts Municipal Money-Market Fund, Michigan Municipal Money-Market Fund, New Jersey Municipal Money-Market Fund, Ohio Municipal Money-Market Fund, Pennsylvania Municipal Money-Market Fund, Virginia Municipal Money-Market Fund of the Reserve Municipal Money-Market Trust II, New York Municipal Money-Market Fund of the Reserve New York Municipal Money Market Trust, Arizona Municipal Money-Market Fund, Louisiana Municipal Money-Market Fund and Minnesota Municipal Money-Market Fund of the Reserve Municipal Money-Market Trust as of May 31, 2007, the results of their operations for the year then ended, the changes in their net assets and the financ ial highlights for each of the years or period in the two-year period then ended, in conformity with U.S. generally accepted accounting principles.
New York, New York
July 27, 2007
52
THE JOINT BOARD OF TRUSTEES AND EXECUTIVE OFFICERS OF THE TRUSTS (Unaudited)
The Board of Trustees is responsible for the management and supervision of the Trusts. The Trustees approve all material agreements between the Trusts and the Trusts' service providers. Biographical information relating to the Trustees and the Executive Officers of the Trusts is set forth below, including their ages, their principal occupations for at least the last five years, their positions with the Trusts and the length of time served. The Trustees and the Executive Officers of the Funds oversee 21 portfolios in The Reserve fund complex. Except as otherwise described below, none of the Trustees or Executive Officers hold public directorships outside of The Reserve fund complex.
INTERESTED TRUSTEES
| Name, Age and Address | Positions Held with the Trusts | Term of Office and Length of Time Served** | Principal Occupation(s) During Past 5 Years | ||||||||||||
| BRUCE R. BENT†* Age: 70 The Reserve 1250 Broadway New York, NY 10001 | Chairman, President and Treasurer | Trustee since inception; Chairman since 2000; Chief Executive Officer from 2000 to 2005. | Chairman of Reserve Management Company, Inc. ("RMCI") since 2005; President of RMCI from 2000 to 2005; Chairman of Reserve Management Corporation ("RMC") since 2000; Chief Executive Officer of RMC from 2000 to 2005; and Chairman of Resrv Partners, Inc. ("RESRV") since 2000; Chairman and Director of Reserve International Liquidity Fund Ltd. since 1990; Co-founder of The Reserve Fund in 1970; Officer thereof since 1970; former Chief Executive Officer of the trusts in the Reserve/Hallmark family of funds. | ||||||||||||
| WILLIAM E. VIKLUND Age: 67 c/o The Reserve 1250 Broadway New York, NY 10001 | Trustee | N/A*** Previously served as Trustee from 1999 - May 12, 2005. | Retired since 1996; Trustee prior to May 12, 2005 | ||||||||||||
INDEPENDENT TRUSTEES
| Name, Age and Address | Positions Held With the Trusts | Term of Office and Length of Time Served** | Principal Occupation(s) During Past 5 Years | ||||||||||||
| JOSEPH D. DONNELLY Age: 60 c/o The Reserve 1250 Broadway New York, NY 10001 | Trustee | Trustee of Reserve Short-Term Investment Trust since 2005 | Retired since 2002; Managing Director and General Counsel to the Pershing Division of Donaldson, Lufkin and Jenrette Securities Corporation from 1984 to 2002; Member of Pershing Executive Committee from 1986 to 2002. Co-chair of Pershing Credit Policy Committee from 1986 to 2002. | ||||||||||||
| EDWIN EHLERT, JR. Age: 76 c/o The Reserve 1250 Broadway New York, NY 10001 | Trustee | Trustee of all Trusts since inception | Retired since 2000. President, Premier Resources, Inc. (meeting management firm) since 1987. | ||||||||||||
| WILLIAM J. MONTGORIS Age: 60 c/o The Reserve 1250 Broadway New York, NY 10001 | Trustee | Trustee of all Trusts since 1999 | Retired since 1999. Chief Operating Officer of The Bear Stearns Companies, Inc. from 1979 to 1999; Director of Stage Stores, Inc. (retailing) since 2004. | ||||||||||||
| FRANK J. STALZER Age: 50 c/o The Reserve 1250 Broadway New York, NY 10001 | Trustee | Trustee of Reserve Short-Term Investment Trust since 2005 | President of Astrex Electronics (a division of RAD Electronics) since 2006; Vice President and General Manager of Arrow/Zeus 2004-2005; Vice President of Marketing for Arrow/Zeus from 2002 to 2004; Vice President of Sales for Arrow/ Zeus from 2000 to 2002; Regional Vice President of Arrow/Richey from 1999 to 2000. | ||||||||||||
53
INDEPENDENT TRUSTEES (Continued)
| Name, Age and Address | Positions Held With the Trusts | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years | ||||||||||||
| RONALD J. ARTINIAN Age: 59 c/o The Reserve 1250 Broadway New York, NY 10001 | Trustee | N/A*** | Executive V.P., Senior Managing Director for Smith Barney from 1989-1998; Private Investor from 1998 to present. Director of First Real Estate Investment Trust of NJ since 1992. | ||||||||||||
| SANTA ALBICOCCO Age: 56 c/o The Reserve 1250 Broadway New York, NY 10001 | Trustee | N/A*** | Treasurer – County of Nassau, NY from 1993 to 2000; Board Member of the New York State Banking Board from 1998 to 2004; Deputy County Executive for Finance – County of Nassau, NY. | ||||||||||||
| STEPHEN P. ZIENIEWICZ Age: 47 c/o The Reserve 1250 Broadway New York, NY 10001 | Trustee | N/A*** | Chief Operating Officer – Saint Louis University Hospital from 2004 to present; Vice President Support Services – South Nassau Communities Hospital from 2001 to 2004. | ||||||||||||
OFFICERS WHO ARE NOT TRUSTEES
| Name, Address and Age | Position(s) Held with Trusts | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years | ||||||||||||
| ARTHUR T. BENT III† Age: 39 The Reserve 1250 Broadway New York, NY 10001 | Co-Chief Executive Officer, Senior Vice President and Assistant Secretary | Senior Vice President and Assistant Secretary since 2000; Co-Chief Executive Officer since 2005. | Vice Chairman of RMCI since 2005; Chief Operating Officer, Treasurer, Senior Vice President and Assistant Secretary of RMCI since 2000; Vice Chairman of RMC since 2005; President, Treasurer and Assistant Secretary of RMC since 2000; Vice Chairman of RESRV since 2005 and Treasurer, Assistant Secretary and Director of RESRV since 2000; former Treasurer and Chief Financial Officer of the trusts in the Reserve/Hallmark family of funds. | ||||||||||||
| BRUCE R. BENT II† Age: 41 The Reserve 1250 Broadway New York, NY 1000 | Co-Chief Executive Office, Senior Vice President and Assistant Treasurer | Assistant Treasurer since 2000; Co-Chief Executive Officer and Senior Vice President since 2005. | Vice Chairman, President, Assistant Secretary of RMCI since 2005; Assistant Treasurer of RMCI since 2000; Senior Vice President and Secretary of RMCI from 2000 to 2005; Vice Chairman and Assistant Secretary of RMC since 2005; Senior Vice President and Assistant Treasurer of RMC since 2000; Vice Chairman of RESRV since 2005 and Secretary, Assistant Treasurer of RESRV since 2000; former Trustee of certain trusts and former President of all trusts in the Reserve/Hallmark family of funds. | ||||||||||||
| PATRICK J. FARRELL Age: 47 The Reserve 1250 Broadway New York, NY 10001 | Chief Financial Officer | Chief Financial Officer since 2006. | Chief Financial Officer of RCMI and RMC since 2006; Treasurer and Assistant Secretary of MainStay Funds, Eclipse Funds and MainStay VP Funds from 2001 to 2005; Principal Financial Officer of McMorgan Funds; Managing Director of New York Life Investment Management. | ||||||||||||
54
OFFICERS WHO ARE NOT TRUSTEES (Continued)
| Name, Address and Age | Position(s) Held with Trusts | Term of Office and Length of Time Served | Principal Occupation(s) During Past 5 Years | ||||||||||||
| CHRISTINA MASSARO Age: 40 The Reserve 1250 Broadway New York, NY 10001 | Chief Compliance Officer | Chief Compliance Officer since 2005. | Chief Compliance Officer of the Funds, RMCI and RESRV since 2005; Anti-Money Laundering Compliance Officer of RMCI and RESRV since 2006; Chief Compliance Officer from 2001 to 2005 and Anti-Money Laundering Compliance Officer from 2002 to 2005 of Maxcor Financial Inc. and Maxcor Financial Asset Management. | ||||||||||||
* Mr. Bruce Bent is an "interested person" of the Funds as defined in Section 2(a) (19) of the Investment Company Act due to his positions with RMC, RMCI and RESRV.
** Each Trustee shall hold office until he resigns, is removed or until his successor is duly elected and qualified. A Trustee shall retire upon attaining the age of seventy-five (75) years, unless extended by a vote of the Trustees. Trustees need not be shareholders.
*** Elected at special meetings of shareholders occurring on April 17, 2007 and May 23, 2007.
† Mr. Bruce R. Bent is the father of Mr. Bruce R. Bent II and Mr. Arthur Bent III.
The Trust's Statement of Additional Information includes additional information about the Trustees and is available without charge, upon request, for Shareholders by calling toll free: 1-800-637-1700.
FEDERAL AND STATE TAX INFORMATION (unaudited)
We are required by the Internal Revenue Code to advise you within 60 days of the Trust's year-end as to the federal tax status of dividends paid during the year. Accordingly, all dividends for the Funds were federally tax-exempt dividends except for dividends paid by Arizona Municipal Money-Market Fund, which were classified as ordinary income for federal income tax purposes.
The Arizona Municipal Money-Market Fund did not meet the requirements of Section 852(b)(5) of the Internal Revenue Code of 1986, as amended, for the payment of exempt-interest dividends to its shareholders, for the year ended May 31, 2007. As a result, all income distributions paid to shareholders with respect to net investment income earned during the year ended May 31, 2007, will be subject to both Federal and Arizona income tax. On an individual level some taxable distributions were paid to you in 2006 and some in the first five months of 2007. The Fund in the near future will be issuing corrected 2006 US Forms 1099-DIVs to applicable shareholders reflecting this characterization. The Fund's investment adviser will make a payment to each affected shareholder equal to the Federal and Arizona state tax payable on dividends paid by the Fund from June 1, 2006 through May 31, 2007, assuming the highest combined effective individual marginal Fe deral and Arizona income tax rates in effect on December 31, 2006 (with respect to dividends paid during 2006) or May 31, 2007 (for dividends paid during 2007).
55
EXPENSE EXAMPLE (Unaudited)
As a shareholder of a Fund, you incur two types of costs: (1) transaction/redemption fees; and (2) ongoing costs, including management fees; distribution and/or service (12b-1) fees; and other Fund expenses. This Example is intended to help you understand your ongoing costs (in dollars) of investing in a Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at December 1, 2006 and held for the entire period ending May 31, 2007.
Actual Expenses
The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled "Expenses Paid During Period" to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical account values and hypothetical expenses based on each Fund's actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the actual return for any of the Funds. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in each Fund with those of other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees, or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only but will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
| Beginning Account Value December 1, 2006 | Ending Account Value May 31, 2007 | Expenses Paid During Period* | |||||||||||||
| Interstate Tax-Exempt Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.26 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Interstate Tax-Exempt Class Treasurer's Trust | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,015.29 | $ | 3.00 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,021.75 | $ | 3.01 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 0.60%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Interstate Tax-Exempt Class 75 | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,014.52 | $ | 3.75 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,020.98 | $ | 3.77 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 0.75%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Interstate Tax-Exempt Class 70 | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,014.77 | $ | 3.50 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,021.24 | $ | 3.51 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 0.70%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Interstate Tax-Exempt Class 45 | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,016.04 | $ | 2.25 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,022.51 | $ | 2.26 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 0.45%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
56
| Beginning Account Value December 1, 2006 | Ending Account Value May 31, 2007 | Expenses Paid During Period* | |||||||||||||
| Interstate Tax-Exempt Class 25 | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,017.05 | $ | 1.25 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,023.52 | $ | 1.26 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 0.25%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Interstate Tax-Exempt Class 15 | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,017.56 | $ | 0.75 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,024.03 | $ | 0.75 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 0.15%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Interstate Tax-Exempt Class Institutional | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,017.73 | $ | 0.60 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,024.18 | $ | 0.60 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 0.12%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| California Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,012.77 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Connecticut Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.25 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Florida Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.32 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Massachusetts Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.32 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Michigan Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.43 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| New Jersey Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.11 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
57
| Beginning Account Value December 1, 2006 | Ending Account Value May 31, 2007 | Expenses Paid During Period* | |||||||||||||
| Ohio Municipal Money-Market Fund Class R | �� | ||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.38 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Pennsylvania Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.34 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Virginia Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.31 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| New York Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.25 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| New York Municipal Money-Market Fund Class Treasurers' Trust | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,014.77 | $ | 3.00 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,021.75 | $ | 3.01 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 0.60%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Arizona Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.44 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Louisiana Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.34 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
| Minnesota Municipal Money-Market Fund Class R | |||||||||||||||
| Actual | $ | 1,000.00 | $ | 1,013.46 | $ | 4.99 | |||||||||
| Hypothetical | $ | 1,000.00 | $ | 1,019.71 | $ | 5.02 | |||||||||
* Expenses are equal to the Fund's annualized expense ratio of 1.00%, multiplied by the average account value over the period, multiplied by 182/365 (to reflect the one-half year period).
58
ADDITIONAL SHAREHOLDER INFORMATION (Unaudited)
Results of a Special Meeting of Shareholders
On April 17, 2007, May 23, 2007 and June 26, 2007 Special Meetings of Shareholders were held to vote at a Trust, Fund and Class level on various proposals recently approved by the Fund's Trustees. The following tables provide the number of votes cast for, against or withheld, as well as the number of abstentions and broker non-votes as to the following proposal:
1. Election of Board Members†
| Nominees | Votes For | Authority Withheld | Abstentions | Broker Non-Vote | |||||||||||||||
| Bruce R. Bent | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 956,939,209 | 19,796,992 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,241,943 | 2,057,646 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
| William E. Viklund | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 957,031,656 | 19,704,545 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,345,375 | 1,954,214 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
| Joseph D. Donnelley | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 957,875,941 | 18,860,260 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,291,691 | 2,007,898 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
| Edwin Ehlert, Jr. | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 956,650,182 | 20,086,019 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,027,775 | 2,271,814 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
| William J. Montgoris | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 956,664,011 | 20,072,193 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,342,842 | 1,956,747 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
| Frank J. Stalzer | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 957,474,160 | 19,262,041 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,351,554 | 1,948,035 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
| Ronald J. Artinian | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 957,727,916 | 19,008,285 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,314,525 | 1,985,064 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
59
| Nominees | Votes For | Authority Withheld | Abstentions | Broker Non-Vote | |||||||||||||||
| Santa Albicocco | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 957,506,557 | 19,229,644 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,281,245 | 2,018,344 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
| Stephen P. Zieniwicz | |||||||||||||||||||
| Reserve Municipal Money-Market Trust II (formerly Reserve Tax-Exempt Trust) | 957,408,207 | 19,327,993 | 0 | 0 | |||||||||||||||
| Reserve New York Municipal Money-Market Trust (formerly New York Tax-Exempt Trust) | 108,352,532 | 1,947,057 | 0 | 0 | |||||||||||||||
| Reserve Municipal Money-Market Trust | 6,939,794 | 618,777 | 0 | 0 | |||||||||||||||
† Board Members are elected by the shareholders of all of the series of the Trust of which the Fund is a series.
On April 17, 2007, May 23, 2007 and June 26, 2007, Special Meetings of Shareholders were held to vote at a Fund level on various proposals recently approved by the Fund's Trustees. The following tables provide the number of votes cast for, against or withheld, as well as the number of abstentions and broker non-votes as to the following proposals: (a) to approve the retention of payments made under the "Comprehensive Fee" Investment Management Agreement, (b) to approve the retention of payments made under Distribution Plans and Distribution Agreements.
Approval of Retention of Payments
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| Approval of Retention of Payments Made Under the "Comprehensive Fee" Investment Management Agreements | |||||||||||||||||||
| Interstate Tax-Exempt | 698,168,672 | 27,164,412 | 7,152,224 | 0 | |||||||||||||||
| California Municipal Money-Market Fund (formerly California Tax-Exempt Fund) | 62,039,114 | 4,407,771 | 3,769,985 | 0 | |||||||||||||||
| Connecticut Municipal Money-Market Fund (formerly Connecticut Tax-Exempt Fund) | 25,307,361 | 1,432,231 | 301,763 | 0 | |||||||||||||||
| Florida Municipal Money-Market Fund (formerly Florida Tax-Exempt Fund) | 25,136,327 | 3,824,667 | 1,126,244 | 0 | |||||||||||||||
| Massachusetts Municipal Money-Market Fund (formerly Massachusetts Tax-Exempt Fund) | 14,659,780 | 756,073 | 457,240 | 0 | |||||||||||||||
| Michigan Municipal Money-Market Fund (formerly Michigan Tax-Exempt Fund) | 5,152,417 | 1,216,035 | 422,547 | 0 | |||||||||||||||
| New Jersey Municipal Money-Market Fund (formerly New Jersey Tax-Exempt Fund) | 27,357,787 | 2,528,336 | 901,995 | 0 | |||||||||||||||
| New York Municipal Money-Market Fund (formerly New York Tax-Exempt Fund) | 111,666,273 | 2,480,018 | 1,034,049 | 0 | |||||||||||||||
| Ohio Municipal Money-Market Fund (formerly Ohio Tax-Exempt Fund) | 9,493,211 | 403,458 | 173,121 | 0 | |||||||||||||||
| Pennsylvania Municipal Money-Market Fund (formerly Pennsylvania Tax-Exempt Fund) | 46,175,110 | 787,506 | 290,486 | 0 | |||||||||||||||
| Virginia Municipal Money-Market Fund (formerly Virginia Tax-Exempt Fund) | 17,201,889 | 710,219 | 81,142 | 0 | |||||||||||||||
| Louisiana Municipal Money-Market Fund | 3,254,470 | 79,573 | 65,336 | 0 | |||||||||||||||
| Minnesota Municipal Money-Market Fund | 1,834,150 | 3,779 | 489,897 | 0 | |||||||||||||||
| Approval of Retention of Payments Made Under Distribution Plans and Distribution Agreements. | |||||||||||||||||||
| Interstate Tax-Exempt | 163,508,910 | 22,192,287 | 6,711,390 | 0 | |||||||||||||||
| California Municipal Money-Market Fund (formerly California Tax-Exempt Fund) | 61,477,925 | 4,956,659 | 3,782,286 | 0 | |||||||||||||||
60
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| Connecticut Municipal Money-Market Fund (formerly Connecticut Tax-Exempt Fund) | 25,348,862 | 1,408,509 | 283,982 | 0 | |||||||||||||||
| Florida Municipal Money-Market Fund (formerly Florida Tax-Exempt Fund) | 25,268,439 | 3,692,555 | 1,126,244 | 0 | |||||||||||||||
| Massachusetts Municipal Money-Market Fund (formerly Massachusetts Tax-Exempt Fund) | 14,561,575 | 619,030 | 692,489 | 0 | |||||||||||||||
| Michigan Municipal Money-Market Fund (formerly Michigan Tax-Exempt Fund) | 5,161,227 | 1,207,225 | 422,547 | 0 | |||||||||||||||
| New Jersey Municipal Money-Market Fund (formerly New Jersey Tax-Exempt Fund) | 27,398,263 | 2,482,677 | 907,178 | 0 | |||||||||||||||
| New York Municipal Money-Market Fund (formerly New York Tax-Exempt Fund) | 111,842,364 | 2,304,658 | 1,023,264 | 0 | |||||||||||||||
| Ohio Municipal Money-Market Fund (formerly Ohio Tax-Exempt Fund) | 9,491,995 | 404,675 | 173,120 | 0 | |||||||||||||||
| Pennsylvania Municipal Money-Market Fund (formerly Pennsylvania Tax-Exempt Fund) | 46,199,376 | 787,042 | 266,683 | 0 | |||||||||||||||
| Virginia Municipal Money-Market Fund (formerly Virginia Tax-Exempt Fund) | 17,248,548 | 668,833 | 75,869 | 0 | |||||||||||||||
| Louisiana Municipal Money-Market Fund | 3,254,470 | 79,573 | 65,336 | 0 | |||||||||||||||
| Minnesota Municipal Money-Market Fund | 1,834,531 | 3,397 | 489,897 | 0 | |||||||||||||||
On April 17, 2007, May 23, 2007 and June 26, 2007, Special Meetings of Shareholders were held to vote at a Class level on various proposals recently approved by the Fund's Trustees. The following tables provide the number of votes cast for, against or withheld, as well as the number of abstentions and broker non-votes by the Class R and the Class I shareholders as to the following proposals: (1) to approve a new "Comprehensive Fee" Investment Management Agreement, (2) to amend the "Comprehensive Fee" Investment Management Agreement, (3) to approve new Distribution Plans and (4) to amend the "Distribution Plans."
1. Approval of New "Comprehensive Fee" Investment Management Agreement
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| Approval of New "Comprehensive Fee" Investment Management Agreement | |||||||||||||||||||
| Interstate Tax-Exempt Fund-Class Institutional | 443,651,557 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 15 | 108,159 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 25 | 38,851,766 | 4,070,478 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 45 | 95,237 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 70 | 5,629,931 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 75 | 5,660,326 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class Treasurer's Trust | 52,806,849 | 91,912 | 396,759 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class R | 151,863,556 | 22,331,371 | 6,927,402 | 0 | |||||||||||||||
| California Municipal Money-Market Fund-Class R (formerly California Tax-Exempt Fund) | 61,298,353 | 5,160,111 | 3,758,407 | 0 | |||||||||||||||
| Connecticut Municipal Money-Market Fund-Class R (formerly Connecticut Tax-Exempt Fund) | 25,222,578 | 1,522,486 | 296,291 | 0 | |||||||||||||||
| Florida Municipal Money-Market Fund-Class R (formerly Florida Tax-Exempt Fund) | 25,246,577 | 3,643,319 | 1,197,342 | 0 | |||||||||||||||
| Massachusetts Municipal Money-Market Fund-Class R (formerly Massachusetts Tax-Exempt Fund) | 14,671,610 | 751,345 | 450,138 | 0 | |||||||||||||||
| Michigan Municipal Money-Market Fund-Class R (formerly Michigan Tax-Exempt Fund) | 5,273,636 | 1,093,776 | 423,587 | 0 | |||||||||||||||
| New Jersey Municipal Money-Market Fund-Class R (formerly New Jersey Tax-Exempt Fund) | 26,759,146 | 3,030,149 | 998,823 | 0 | |||||||||||||||
| New York Municipal Money-Market Fund-Class R (formerly New York Tax-Exempt Fund) | 111,305,348 | 2,637,016 | 1,227,922 | 0 | |||||||||||||||
61
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| New York Municipal Money-Market Fund-Class Treasurer's Trust (formerly New York Tax-Exempt Fund) | 10,0550 | 0 | 0 | 0 | |||||||||||||||
| Ohio Municipal Money-Market Fund-Class R (formerly Ohio Tax-Exempt Fund) | 9,494,823 | 411,348 | 163,619 | 0 | |||||||||||||||
| Pennsylvania Municipal Money-Market Fund-Class R (formerly Pennsylvania Tax-Exempt Fund) | 46,374,132 | 599,990 | 278,979 | 0 | |||||||||||||||
| Virginia Municipal Money-Market Fund-Class R (formerly Virginia Tax-Exempt Fund) | 17,082,678 | 837,989 | 72,584 | 0 | |||||||||||||||
| Louisiana Municipal Money-Market Fund-Class R | 3,194,170 | 139,874 | 65,336 | 0 | |||||||||||||||
| Minnesota Municipal Money-Market Fund-Class R | 1,834,150 | 3,779 | 489,897 | 0 | |||||||||||||||
2. Approval of Amendment to "Comprehensive Fee" Investment Management Agreement
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| Approval of Amendment to "Comprehensive Fee" Investment Management Agreement | |||||||||||||||||||
| Interstate Tax-Exempt Fund-Class Institutional | 443,651,557 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 15 | 108,159 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 25 | 34,904,213 | 4,070,478 | 0 | 3,947,553 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 45 | 95,237 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 70 | 5,629,931 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 75 | 5,660,326 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class Treasurer's Trust | 52,547,740 | 78,378 | 410,570 | 258,832 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class R | 122,404,573 | 22,465,827 | 7,012,810 | 29,239,119 | |||||||||||||||
| California Municipal Money-Market Fund-Class R (formerly California Tax-Exempt Fund) | 60,799,612 | 5,256,854 | 3,748,729 | 411,676 | |||||||||||||||
| Connecticut Municipal Money-Market Fund-Class R (formerly Connecticut Tax-Exempt Fund) | 18,643,614 | 1,503,527 | 303,237 | 6,590,977 | |||||||||||||||
| Florida Municipal Money-Market Fund-Class R (formerly Florida Tax-Exempt Fund) | 25,078,778 | 3,805,364 | 1,197,346 | 5,750 | |||||||||||||||
| Massachusetts Municipal Money-Market Fund-Class R (formerly Massachusetts Tax-Exempt Fund) | 13,159,485 | 752,851 | 450,136 | 1,510,621 | |||||||||||||||
| Michigan Municipal Money-Market Fund-Class R (formerly Michigan Tax-Exempt Fund) | 5,253,852 | 1,113,557 | 423,587 | 3 | |||||||||||||||
| New Jersey Municipal Money-Market Fund-Class R (formerly New Jersey Tax-Exempt Fund) | 26,623,027 | 2,983,334 | 981,249 | 200,508 | |||||||||||||||
| New York Municipal Money-Market Fund-Class R (formerly New York Tax-Exempt Fund) | 80,955,006 | 3,178,112 | 1,048,318 | 29,988,850 | |||||||||||||||
| New York Municipal Money-Market Fund-Class Treasurer's Trust (formerly New York Tax-Exempt Fund) | 10,055 | 0 | 0 | 0 | |||||||||||||||
| Ohio Municipal Money-Market Fund-Class R (formerly Ohio Tax-Exempt Fund) | 7,499,459 | 444,213 | 163,616 | 1,962,503 | |||||||||||||||
| Pennsylvania Municipal Money-Market Fund-Class R (formerly Pennsylvania Tax-Exempt Fund) | 34,204,597 | 730,094 | 283,734 | 12,034,676 | |||||||||||||||
| Virginia Municipal Money-Market Fund-Class R (formerly Virginia Tax-Exempt Fund) | 12,110,231 | 839,116 | 77,021 | 4,966,882 | |||||||||||||||
| Arizona Municipal Money-Market Fund-Class R | 1,831,364 | 0 | 0 | 0 | |||||||||||||||
| Louisiana Municipal Money-Market Fund-Class R | 3,194,170 | 79,573 | 125,637 | 0 | |||||||||||||||
| Minnesota Municipal Money-Market Fund-Class R | 1,834,150 | 3,779 | 489,897 | 0 | |||||||||||||||
62
3. Approval of New Distribution Plan
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| Approval of New Distribution Plan | |||||||||||||||||||
| Interstate Tax-Exempt Fund-Class 70 | 5,629,931 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 75 | 5,660,326 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class R | 152,413,689 | 21,381,288 | 7,327,353 | 0 | |||||||||||||||
| California Municipal Money-Market Fund-Class R (formerly California Tax-Exempt Fund) | 61,709,386 | 4,613,922 | 3,893,563 | 0 | |||||||||||||||
| Connecticut Municipal Money-Market Fund-Class R (formerly Connecticut Tax-Exempt Fund) | 25,825,696 | 927,218 | 288,440 | 0 | |||||||||||||||
| Florida Municipal Money-Market Fund-Class R (formerly Florida Tax-Exempt Fund) | 25,356,505 | 3,393,385 | 1,337,348 | 0 | |||||||||||||||
| Massachusetts Municipal Money-Market Fund-Class R (formerly Massachusetts Tax-Exempt Fund) | 14,682,918 | 641,832 | 548,344 | 0 | |||||||||||||||
| Michigan Municipal Money-Market Fund-Class R (formerly Michigan Tax-Exempt Fund) | 5,290,356 | 1,077,285 | 423,357 | 0 | |||||||||||||||
| New Jersey Municipal Money-Market Fund-Class R (formerly New Jersey Tax-Exempt Fund) | 27,090,112 | 2,728,380 | 969,626 | 0 | |||||||||||||||
| New York Municipal Money-Market Fund-Class R (formerly New York Tax-Exempt Fund) | 111,783,361 | 2,319,596 | 1,067,328 | 0 | |||||||||||||||
| Ohio Municipal Money-Market Fund-Class R (formerly Ohio Tax-Exempt Fund) | 9,494,223 | 408,257 | 167,310 | 0 | |||||||||||||||
| Pennsylvania Municipal Money-Market Fund-Class R (formerly Pennsylvania Tax-Exempt Fund) | 46,321,325 | 604,796 | 326,981 | 0 | |||||||||||||||
| Virginia Municipal Money-Market Fund-Class R (formerly Virginia Tax-Exempt Fund) | 17,193,733 | 731,426 | 68,091 | 0 | |||||||||||||||
| Louisiana Municipal Money-Market Fund-Class R | 3,194,170 | 139,874 | 65,336 | 0 | |||||||||||||||
| Minnesota Municipal Money-Market Fund-Class R | 1,834,531 | 3,397 | 489,897 | 0 | |||||||||||||||
4. Approval of Amendment to New Distribution Plan
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| Approval of Amendment to New Distribution Plan | |||||||||||||||||||
| Interstate Tax-Exempt Fund-Class 70 | 5,629,931 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class 75 | 5,660,326 | 0 | 0 | 0 | |||||||||||||||
| Interstate Tax-Exempt Fund-Class R | 123,043,742 | 21,627,037 | 7,212,431 | 29,239,119 | |||||||||||||||
| California Municipal Money-Market Fund-Class R (formerly California Tax-Exempt Fund) | 60,834,557 | 5,100,282 | 3,870,355 | 411,676 | |||||||||||||||
| Connecticut Municipal Money-Market Fund-Class R (formerly Connecticut Tax-Exempt Fund) | 18,679,753 | 1,468,862 | 301,763 | 6,590,977 | |||||||||||||||
| Florida Municipal Money-Market Fund-Class R (formerly Florida Tax-Exempt Fund) | 25,172,717 | 3,573,656 | 1,335,116 | 5,750 | |||||||||||||||
| Massachusetts Municipal Money-Market Fund-Class R (formerly Massachusetts Tax-Exempt Fund) | 13,188,649 | 618,535 | 555,289 | 1,510,621 | |||||||||||||||
| Michigan Municipal Money-Market Fund-Class R (formerly Michigan Tax-Exempt Fund) | 5,233,259 | 1,078,141 | 479,595 | 3 | |||||||||||||||
| New Jersey Municipal Money-Market Fund-Class R (formerly New Jersey Tax-Exempt Fund) | 26,832,081 | 2,855,662 | 899,867 | 200,508 | |||||||||||||||
| New York Municipal Money-Market Fund-Class R (formerly New York Tax-Exempt Fund) | 81,140,861 | 2,699,758 | 1,340,816 | 29,988,850 | |||||||||||||||
| Ohio Municipal Money-Market Fund-Class R (formerly Ohio Tax-Exempt Fund) | 7,518,523 | 421,457 | 167,307 | 1,962,503 | |||||||||||||||
| Pennsylvania Municipal Money-Market Fund-Class R (formerly Pennsylvania Tax-Exempt Fund) | 34,277,132 | 614,313 | 326,981 | 12,034,676 | |||||||||||||||
63
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| Virginia Municipal Money-Market Fund-Class R (formerly Virginia Tax-Exempt Fund) | 12,204,262 | 757,407 | 64,699 | 4,966,882 | |||||||||||||||
| Arizona Municipal Money-Market Fund-Class R | 1,831,364 | 0 | 0 | 0 | |||||||||||||||
| Louisiana Municipal Money-Market Fund-Class R | 3,194,170 | 159,303 | 45,908 | 0 | |||||||||||||||
| Minnesota Municipal Money-Market Fund-Class R | 1,834,531 | 3,397 | 489,897 | 0 | |||||||||||||||
On April 17, 2007, May 23, 2007 and June 26, 2007, Special Meetings of Shareholders were held to vote at a Fund level on various proposals recently approved by the Fund's Trustees. The following tables provide the number of votes cast for, against or withheld, as well as the number of abstentions and broker non-votes Fund shareholders as to the following proposal: approval of change in fundamental Investment policy.
| Item Voted On | Votes For | Votes Against | Abstentions | Broker Non-Votes | |||||||||||||||
| Approval of Change in Fundamental Investment Policy | |||||||||||||||||||
| California Municipal Money-Market Fund (formerly California Tax-Exempt Fund) | 61,486,075 | 3,767,194 | 4,551,926 | 411,676 | |||||||||||||||
| Connecticut Municipal Money-Market Fund (formerly Connecticut Tax-Exempt Fund) | 18,799,746 | 1,337,701 | 312,930 | 6,590,977 | |||||||||||||||
| Florida Municipal Money-Market Fund (formerly Florida Tax-Exempt Fund) | 25,477,787 | 3,401,928 | 1,201,773 | 5,750 | |||||||||||||||
| Massachusetts Municipal Money-Market Fund (formerly Massachusetts Tax-Exempt Fund) | 13,080,192 | 825,677 | 456,604 | 1,510,621 | |||||||||||||||
| Michigan Municipal Money-Market Fund (formerly Michigan Tax-Exempt Fund) | 5,450,887 | 914,558 | 425,550 | 3 | |||||||||||||||
| New Jersey Municipal Money-Market Fund (formerly New Jersey Tax-Exempt Fund) | 26,809,552 | 2,770,956 | 1,007,102 | 200,508 | |||||||||||||||
| New York Municipal Money-Market Fund (formerly New York Tax-Exempt Fund) | 81,009,992 | 2,617,247 | 1,564,252 | 29,988,850 | |||||||||||||||
| Ohio Municipal Money-Market Fund (formerly Ohio Tax-Exempt Fund) | 7,533,427 | 406,553 | 167,307 | 1,962,503 | |||||||||||||||
| Pennsylvania Municipal Money-Market Fund (formerly Pennsylvania Tax-Exempt Fund) | 34,398,474 | 579,324 | 240,628 | 12,034,676 | |||||||||||||||
| Virginia Municipal Money-Market Fund (formerly Virginia Tax-Exempt Fund) | 12,305,352 | 648,689 | 72,327 | 4,966,882 | |||||||||||||||
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AVAILABILITY OF PROXY VOTING INFORMATION
The day-to-day investment management decisions of each Fund are the responsibility of that Fund's investment adviser, RMCI. RMCI is primarily responsible for determining how to vote proxies with respect to companies in which the respective Fund invests and for the ongoing review and evaluation of its own proxy voting policies and corresponding compliance with applicable law.
RMCI's proxy voting policies and procedures, as well as information about how a particular proxy was voted, may be obtained without charge by calling 800-637-1700 to request a copy or by visiting the SEC's Web site at www.sec.gov. Information regarding how each Fund voted proxies relating to portfolio securities during the 12-month period ended June 30, 2006 is available on the SEC's Web site or by calling the toll-free number listed above.
AVAILABILITY OF QUARTERLY PORTFOLIO SCHEDULE
The Funds file a complete schedule of portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. The Forms N-Q are available on the SEC's Web site at www.sec.gov and may be reviewed and copied at the SEC's Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
APPROVAL OF "COMPREHENSIVE FEE" INVESTMENT MANAGEMENT AGREEMENTS
Reserve Funds
Provided below is a summary of certain factors the Board of Trustees, including the Independent Trustees, considered at a meeting held on July 17, 2006 in approving each Fund's "Comprehensive Fee" Investment Management Agreement with RMC of which were subsequently presented to Fund shareholders for approval. At the July 17, 2006 meeting, the Board had the opportunity to meet with the representatives of RMCI to determine whether each proposed Agreement is in the best interests of the respective Fund and its shareholders. The Board, including a majority of the Independent Trustees, approved the Investment Management Agreements. The Board did not identify any particular information that was most relevant to its determination to approve the Agreements, and each Trustee may have afforded different weight to the various factors.
Nature, Extent and Quality of Service
The Board received and considered information regarding the nature, extent and quality of the advisory and other services provided to each Fund by RMCI. The Board considered the background and experience of RMCI's management and the expertise of personnel of RMCI with regard to investing in the type of securities in which the Funds invest. The Trustees concluded that the nature and extent of the services provided by RMCI under each Investment Management Agreement were necessary and appropriate for the conduct and the business and investment activities of each Fund. The Trustees also concluded that the quality of the advisory and administrative services was satisfactory.
Comparative Fees and Expenses
The comprehensive management fee charged under each Investment Management Agreement encompasses all of the services necessary for the operation of the relevant Fund. Therefore, in evaluating the fee relative to other funds the Trustees thought the most appropriate comparison was to the respective expense ratios of the Funds. The Trustees compared each Fund's expense ratios to (i) the average expense ratio of all money market funds with similar investment objectives and policies; and (ii) the expense ratios of money market funds which are believed to be direct competitors of the Funds ("peer funds"), i.e., money market funds which are distributed through third-party broker/dealers and other financial institutions which do not have their own proprietary money market funds. The Trustees noted that the expense ratio of the institutional classes of shares of each Fund were comparable to or lower than the average expense ratio of other money marke t funds as well as those of peer funds. They also noted that the expense ratios of the retail classes of shares were higher than the average of other money market funds but comparable to the expense ratios of peer funds. Based upon their review, the Trustees concluded that the fee payable under each Investment Management Agreement is competitive.
Comparative Performance
The Trustees considered the performance of the Funds relative to other money market funds with similar objectives and policies. In this regard, the Trustees noted that the Funds generally invest in a more conservative and risk averse manner than their peers. For example, the Funds typically have a shorter average maturity than many other money market funds. The Trustees concluded that, under the circumstances, the performance of the Funds was satisfactory.
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Profitability
The Trustees received, analyzed and considered a profitability analysis of RMCI based on the fees paid and payable under each Investment Management Agreement, including any fee waivers or fee caps, and the costs incurred to provide required services, as well as other relationships between the Funds on the one hand and RMCI affiliates on the other. The Trustees concluded, with respect to each Fund, that RMCI's profitability was not excessive in light of the nature, extent and quality of the services provided and expected to be provided under Investment Management Agreements.
Economies of Scale
As the comprehensive management fee is currently structured, fee levels do not reflect economies of scale that potentially could be realized as the Funds grow. The Trustees noted the potential benefits to shareholders of a comprehensive fee which would tend to limit increases in the Funds' expense ratios even if the costs of providing services increase and the related entrepreneurial risk assumed by RMCI through such an approach. Based on the foregoing, the Trustees concluded that the absence of breakpoints was reasonable.
Other Benefits
The Trustees concluded that RMCI does not realize any other quantifiable material benefits from its relationship with the Funds.
Conclusion
Based on, but not limited to, the above considerations, the Board determine that the Investment Management Agreements with respect to each Fund were fair and reasonable in light of the services to be performed, fees, expenses and such other matters as the Board considered relevant in the exercise of its business judgment. On this basis, the Board unanimously voted to approve of these Agreements.
Board Considerations of Amendments to Comprehensive Fee Agreements
Provided below is a summary of certain factors the Boards of Trustees, including the Independent Trustees, considered at a meeting held on January 10, 2007 in approving amendments to the Funds' "Comprehensive Fee" Investment Management Agreement with RMCI. At the January 10, 2007 meeting, the Boards had the opportunity to meet with the representatives of RMCI to determine whether the proposed amendments to the Agreements is in the best interests of the Funds and its shareholders. The Boards, including a majority of the Independent Trustees, approved the amendments to the Investment Management Agreements and recommended that shareholders approve the same. The Boards did not identify any particular information that was most relevant to its determination to approve the amendments and each Trustee may have afforded different weight to the various factors. In determining to approve the amendments, the Boards considered that they had recently appr oved the new "Comprehensive Fee" Investment Management Agreements on July 17, 2006. To the extent deemed necessary or appropriate in their business judgment, the Trustees reconsidered these factors during their January 10, 2007 meeting.
The Boards were provided with an analysis by RMCI of the market forces affecting the Funds' fee and expense levels, and recent trends with respect to expenses of the Funds. With regard to the proposed amendment to the "Comprehensive Fee" Investment Management Agreements specifically, the Boards were provided with a pro-forma analysis of annualized 2006 (or in some cases, estimated 2007) expenses, which illustrated the types and amounts of expenses incurred by RMCI under the Comprehensive Fee Investment Management Agreements. Historical data was provided showing the increases in certain expenses since 2000 including registration fees, outside counsel fees, compliance expenses and costs of Board meetings.
The Boards considered the increases in fees and expenses incurred by RMCI over time associated with, among other things, legal, compliance and regulatory costs and their effect on the ability of RMCI to continue to provide high quality services to the Funds. The Boards also considered the effect of the fee increase on the expense ratios of the Funds and concluded that the Funds' expense ratios would continue to be competitive with similar providers in the fund industry. Based upon their review and discussion, the Trustees concluded that it was reasonable and in the best interest of shareholders to approve an amendment to each "Comprehensive Fee" Investment Management Agreement providing for a one basis point increase in the comprehensive fee.
In addition, in order to enhance the independence of the Funds' chief compliance officer and be consistent with the nature of and the policy underlying having an independent legal counsel of the Independent Trustees of the Trusts, the Boards determined that the terms of the Agreements should be revised to separate these costs from the comprehensive fee arrangement entirely so to have the Trusts pay these persons directly and for the Boards to control the services provided by and the fees paid to these persons. Therefore, the Boards determined to recommend to shareholders that the terms of the Agreements be amended to provide that the comprehensive fee arrangement excludes costs and/or expenses associated with the chief compliance officer and independent counsel to the Independent Trustees and that these costs should be borne directly by the Trusts.
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Item 2. Code of Ethics.
The registrant has adopted a code of ethics that applies to the registrant’s principal executive officers and principal financial officer. The registrant has not made any amendments to its code of ethics during the covered period. The registrant has not granted any waivers from any provisions of the code of ethics during the covered period. A copy of the registrant’s code of ethics is filed herewith.
Item 3. Audit Committee Financial Expert.
The registrant’s board of trustees has determined that there is at least one audit committee financial expert serving on its audit committee. William Montgoris and Santa Albicocco are the audit committee financial experts and are considered to be independent.
Item 4. Principal Accountant Fees and Services.
(a) Audit Fees. The registrant paid the following amounts to KMPG, LLP, the registrant’s principal accountant, for the audit of the registrant’s annual financial statements and services normally provided in connection with statutory and regulatory filings or engagements in connection therewith for each of the last two fiscal years:
2007 |
| 2006 |
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$ | 64,200 |
| $ | 60,000 |
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(b) None.
(c) Tax Fees. The registrant paid the following amounts to KPMG, LLP, the registrant’s principal accountant, for tax compliance, tax advice and tax planning for each of the last two fiscal years:
2007 |
| 2006 |
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$ | 6,300 |
| $ | 6,000 |
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(d) None.
(e) Before KPMG, LLP, the registrant’s principal accountant, is engaged to render audit or non-audit services by the registrant, the registrant’s investment adviser, or any entity controlling, controlled by, or under common control with the registrant’s investment adviser that provides ongoing services to the registrant, the engagement is approved by the registrant’s Audit Committee. The Audit Committee has delegated the authority to pre-approve non-audit services to the Chairman of the Audit Committee, currently William Montgoris, subject to subsequent ratification by the Audit Committee.
(f) None.
(g) The following table indicates the aggregate non-audit fees billed by the registrant’s accountant for services rendered to the registrant, and rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant.
2007 |
| 2006 |
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$ | 6,300 |
| $ | 6,000 |
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(h) Not applicable.
Item 5. |
| Audit Committee of Listed Registrants. |
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Not applicable. | ||
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Item 6. |
| Schedule of Investments. |
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The schedule of investments in securities of unaffiliated issuers as of the close of the reporting period is included as part of the report to shareholders filed under Item 1 of this Form. | ||
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Item 7. |
| Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
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Not applicable | ||
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Item 8. |
| Portfolio Managers of Closed-End Management Investment Companies. |
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Not applicable. | ||
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Item 9. |
| Purchases of Equity Securities by Closed-End Management Investment Company and Affiliates. |
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Not applicable. | ||
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Item 10. |
| Submission of Matters to a Vote of Security Holders. |
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No changes have been made to the procedures by which stockholders can nominate independent trustees. | ||
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ITEM 11. |
| Controls and Procedures. |
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(a) |
| Based on an evaluation of the disclosure controls and procedures (as defined in rule 30a-3(c) under the Investment |
Company Act of 1940, as amended (the “Act”) as of a date within 90 days of the filing of this report, the Co-Chief Executive Officers (the principal executive officers) and Chief Financial Officer (principal financial officer) of the Registrant have concluded that such disclosure controls and procedures are effectively designed to ensure that information required to be disclosed by the Registrant is recorded, processed, summarized and reported within the required time periods and is accumulated and communicated to the Registrant’s management to allow timely decisions regarding required disclosure. | ||
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(b) |
| There has been no change in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under |
the Act) that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting. | ||
Item 12. Exhibits.
(a) (1) Code of ethics.
(a) (2) Certifications of Co-Chief Executive Officers and Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002: Filed herewith
(b) &nb sp; Certifications of Co-Chief Executive Officers and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002: Furnished herewith
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Reserve Municipal Money Market Trust
By: |
| /s/ Bruce R. Bent II |
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| Name: Bruce R. Bent II |
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| Title: Co-Chief Executive Officer |
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Date: |
| August 9, 2007 |
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By: |
| /s/ Arthur T. Bent III |
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| Name: Arthur T. Bent III |
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| Title: Co-Chief Executive Officer |
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Date: |
| August 9, 2007 |
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Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, as amended, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: |
| /s/ Bruce R. Bent II |
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| Name: Bruce R. Bent II |
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| Title: Co-Chief Executive Officer |
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Date: |
| August 9, 2007 |
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By: |
| /s/ Arthur T. Bent III |
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| Name: Arthur T. Bent III |
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| Title: Co-Chief Executive Officer |
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Date: |
| August 9, 2007 |
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By: |
| /s/ Patrick Farrell |
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| Name: Patrick Farrell |
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| Title: Chief Financial Officer |
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Date: |
| August 9, 2007 |
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