UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSRS CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES |
Investment Company Act file number 811-03111 and 811-21301 Name of Fund: CMA Tax-Exempt Fund and Master Tax-Exempt LLC Fund Address: 100 Bellevue Parkway, Wilmington, DE 19809 Name and address of agent for service: Donald C. Burke, Chief Executive Officer, CMA Tax-Exempt Fund and Master Tax-Exempt LLC, 800 Scudders Mill Road, Plainsboro, NJ, 08536. Mailing address: P.O. Box 9011, Princeton, NJ, 08543-9011 Registrant’s telephone number, including area code: (800) 221-7210 Date of fiscal year end: 03/31/2009 Date of reporting period: 04/01/2008 – 09/30/2008 Item 1 – Report to Stockholders |
Semi-Annual Report (Unaudited)
September 30, 2008
CMA Tax-Exempt Fund
Table of Contents | ||
Page | ||
A Letter to Shareholders | 3 | |
Semi-Annual Report: | ||
Disclosure of Expenses | 4 | |
Current Seven-Day Yield | 4 | |
Fund Financial Statements: | ||
Statement of Assets and Liabilities | 5 | |
Statement of Operations | 5 | |
Statements of Changes in Net Assets | 6 | |
Fund Financial Highlights | 7 | |
Fund Notes to Financial Statements | 8 | |
Master LLC Portfolio Summary | 10 | |
Master LLC Financial Statements: | ||
Schedule of Investments | 11 | |
Statement of Assets and Liabilities | 28 | |
Statement of Operations | 28 | |
Statements of Changes in Net Assets | 29 | |
Master LLC Financial Highlights | 29 | |
Master LLC Notes to Financial Statements | 30 | |
Disclosure of Investment Advisory Agreement and Subadvisory Agreement | 32 | |
Officers and Directors | 36 | |
Additional Information | 37 |
2 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
A Letter to Shareholders
Dear Shareholder
It has been a tumultuous period for investors, marked by almost daily headlines related to the housing market turmoil, volatile energy prices, and the escalating credit crisis. The news took an extraordinarily heavy tone in September as the credit crisis boiled over and triggered unprecedented failures and consolidation in the financial sector, stoking fears of a market and economic collapse and prompting the largest government rescue plan since the Great Depression.
Through it all, the Federal Reserve Board (the “Fed”) has taken decisive action to restore liquidity and bolster financial market stability. Key moves included slashing the target federal funds rate 275 basis points (2.75%) between October 2007 and April 2008 and providing massive cash injections and lending programs. As the credit crisis took an extreme turn for the worse, the Fed, in concert with five other global central banks, cut interest rates by 50 basis points in early October in a rare move intended to stave off worldwide economic damage from the intensifying financial market turmoil. The U.S. economy managed to grow at a slow-but-positive pace through the second quarter of the year, though recent events almost certainly portend a global economic recession.
Against this backdrop, U.S. stocks experienced intense volatility and generally posted losses for the current reporting period, with small-cap stocks faring noticeably better than their larger counterparts. Non-U.S. markets followed the U.S. on the way down and, notably, decelerated at a faster pace than domestic equities — a stark reversal of recent years’ trends, when international stocks generally outpaced U.S. stocks.
Treasury securities also traded in a volatile fashion, but rallied overall (yields fell and prices correspondingly rose) amid an ongoing flight to quality. The yield on 10-year Treasury issues, which fell to 3.34% in March, climbed to the 4.20% range in mid-June as investors temporarily shifted out of Treasury issues in favor of riskier assets (such as stocks and other high-quality fixed income sectors), then declined again to 3.85% by period-end as the financial market contagion widened. Tax-exempt issues underperformed overall, as problems among municipal bond insurers and the collapse in the market for auction rate securities pressured the group throughout the course of the past year. At the same time, the above mentioned economic headwinds and malfunctioning credit markets led to considerable weakness in the high yield sector.
Facing unprecedented volatility and macro pressures, the major benchmark indexes generally recorded losses over the six- and 12-month reporting periods:
Total Returns as of September 30, 2008 | 6-month | 12-month | ||
U.S. equities (S&P 500 Index) | (10.87)% | (21.98)% | ||
Small cap U.S. equities (Russell 2000 Index) | (0.54) | (14.48) | ||
International equities (MSCI Europe, Australasia, Far East Index) | (22.35) | (30.50) | ||
Fixed income (Barclays Capital U.S. Aggregate Index)* | (1.50) | 3.65 | ||
Tax-exempt fixed income (Barclays Capital Municipal Bond Index)* | (2.59) | (1.87) | ||
High yield bonds (Barclays Capital U.S. Corporate High Yield 2% Issuer Capped Index)* | (6.77) | (10.51) | ||
* | Formerly a Lehman Brothers index. |
Past performance is no guarantee of future results. Index performance shown for illustrative purposes only. You cannot invest directly in an index. | |
Through periods of market turbulence, as ever, BlackRock’s full resources are dedicated to the management of our clients’ assets. For our most current views on the economy and financial markets, we invite you to visit www.blackrock.com/funds. As always, we thank you for entrusting BlackRock with your investments, and we look forward to continuing to serve you in the months and years ahead.
Sincerely,
Rob Kapito President, BlackRock Advisors, LLC |
THIS PAGE NOT PART OF YOUR FUND REPORT |
3 |
Disclosure of Expenses Shareholders of this Fund may incur the following charges: (a) expenses related to transactions, including sales charges, redemption fees and exchange fees; and (b) operating expenses including advisory fees, distri- bution fees including 12b-1 fees, and other Fund expenses. The expense example below (which is based on a hypothetical investment of $1,000 invested on April 1, 2008 and held through September 30, 2008) is intended to assist shareholders both in calculating expenses based on an investment in the Fund and in comparing these expenses with similar costs of investing in other mutual funds. The table below provides information about actual account values and actual expenses. In order to estimate the expenses a shareholder paid during the period covered by this report, shareholders can divide their account value by $1,000 and then multiply the result by the number in the first line under the heading entitled “Expenses Paid During the Period.” |
The table also provides information about hypothetical account values and hypothetical expenses based on the Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses. In order to assist shareholders in comparing the ongoing expenses of investing in this Fund and other funds, compare the 5% hypothetical example with the 5% hypothetical examples that appear in other funds’ shareholder reports. The expenses shown in the table are intended to highlight shareholders’ ongoing costs only and do not reflect any transactional expenses, such as sales charges, redemption fees or exchange fees. Therefore, the hypothetical example is useful in comparing ongoing expenses only, and will not help shareholders determine the relative total expenses of owning different funds. If these transactional expenses were included, shareholder expenses would have been higher. |
Expense Example | ||||||||||||
Actual | Hypothetical2 | |||||||||||
Ending | Ending | |||||||||||
Beginning | Account Value | Beginning | Account Value | |||||||||
Account Value | September 30, | Expenses Paid | Account Value | September 30, | Expenses Paid | |||||||
April 1, 2008 | 2008 | During the Period1 | April 1, 2008 | 2008 | During the Period1 | |||||||
CMA Tax-Exempt Fund | $1,000 | $1,008.30 | $2.77 | $1,000 | $1,022.34 | $2.79 | ||||||
1 Expenses are equal to the Fund’s annualized expense ratio of 0.55%, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period shown). Because the Fund is a feeder fund, the expense table example reflects the expenses of both the feeder fund and the master fund in which it invests. 2 Hypothetical 5% annual return before expenses is calculated by pro-rating the number of days in the most recent fiscal half year divided by 365. |
Current Seven-Day Yield | ||
As of September 30, 2008 | 4.97% |
4 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
Statement of Assets and Liabilities
September 30, 2008 (Unaudited) | CMA Tax-Exempt Fund | |
Assets | ||
Investment at value — Master Tax-Exempt LLC | ||
(the “Master LLC”) (cost — $9,924,866,118) | $ 9,924,866,118 | |
Withdrawals receivable from the Master LLC | 195,753 | |
Prepaid expenses | 314,116 | |
Other assets | 115,170 | |
Total assets | 9,925,491,157 | |
Liabilities | ||
Administration fees payable | 2,188,110 | |
Distribution fees payable | 1,459,310 | |
Capital shares redeemed payable | 195,753 | |
Income dividends payable | 3,730 | |
Officer’s and Directors’ fees payable | 919 | |
Total liabilities | 3,847,822 | |
Net Assets | $ 9,921,643,335 | |
Net Assets Consist of | ||
Par value, $0.10 per share, unlimited number of shares | ||
authorized (9,922,062,033 shares issued and | ||
outstanding) | $ 992,206,203 | |
Paid-in capital in excess of par | 8,928,885,779 | |
Accumulated net realized gain allocated from the | ||
Master LLC | 551,353 | |
Net Assets, $1.00 net asset value per share | $ 9,921,643,335 | |
See Notes to Financial Statements. |
Statement of Operations | ||
Six Months Ended September 30, 2008 (Unaudited) | CMA Tax-Exempt Fund | |
Investment Income | ||
Net investment income allocated from the Master LLC: | ||
Interest | $ 120,068,819 | |
Expenses | (8,126,570) | |
Total income | 111,942,249 | |
Expenses | ||
Administration | 13,789,343 | |
Distribution | 6,842,071 | |
Transfer agent | 791,504 | |
Registration | 463,792 | |
Printing | 64,014 | |
Professional | 25,250 | |
Officer and Directors | 4,914 | |
Miscellaneous | 15,423 | |
Total expenses | 21,996,311 | |
Net investment income | 89,945,938 | |
Realized Gain Allocated from the Master LLC | ||
Net realized gain from investments | 3,329 | |
Net Increase in Net Assets Resulting from Operations | $ 89,949,267 | |
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
5 |
Statements of Changes in Net Assets | CMA Tax-Exempt Fund | |||
Six Months | ||||
Ended | Year | |||
September 30, | Ended | |||
2008 | March 31, | |||
Increase (Decrease) in Net Assets: | (Unaudited) | 2008 | ||
Operations | ||||
Net investment income | $ 89,945,938 | $ 286,826,113 | ||
Net realized gain | 3,329 | 1,483,829 | ||
Net increase in net assets resulting from operations | 89,949,267 | 288,309,942 | ||
Dividends to Shareholders From | ||||
Net investment income | (89,945,938) | (286,826,113) | ||
Capital Share Transactions | ||||
Net proceeds from sale of shares | 32,878,932,615 | 63,109,695,273 | ||
Reinvestment of dividends | 89,945,938 | 286,826,113 | ||
Total shares issued | 32,968,878,553 | 63,396,521,386 | ||
Cost of shares redeemed | (34,050,843,264) | (61,652,029,689) | ||
Net increase (decrease) in net assets derived from share transactions | (1,081,964,711) | 1,744,491,697 | ||
Net Assets | ||||
Total increase (decrease) in net assets | (1,081,961,382) | 1,745,975,526 | ||
Beginning of period | 11,003,604,717 | 9,257,629,191 | ||
End of period | $ 9,921,643,335 | $11,003,604,717 | ||
See Notes to Financial Statements. |
6 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
Financial Highlights | CMA Tax-Exempt Fund | |||||||||||||
Six Months | ||||||||||||||
Ended | ||||||||||||||
September 30, | ||||||||||||||
2008 | Year Ended March 31, | |||||||||||||
(Unaudited) | 2008 | 2007 | 2006 | 2005 | 2004 | |||||||||
Per Share Operating Performance | ||||||||||||||
Net asset value, beginning of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | ||||||||
Net investment income | 0.01 | 0.03 | 0.03 | 0.02 | 0.01 | 0.01 | ||||||||
Net realized gain (loss) | 0.001 | 0.001 | 0.001 | 0.002 | 0.002 | 0.002 | ||||||||
Net increase from investment operations | 0.01 | 0.03 | 0.03 | 0.02 | 0.01 | 0.01 | ||||||||
Dividends from net investment income | (0.01) | (0.03) | (0.03) | (0.02) | (0.01) | (0.01) | ||||||||
Net asset value, end of period | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | $ 1.00 | ||||||||
Total Investment Return | ||||||||||||||
Total investment return | 0.83%3 | 2.94% | 3.05% | 2.24% | 0.93% | 0.54% | ||||||||
Ratios to Average Net Assets4 | ||||||||||||||
Total expenses | 0.55%5 | 0.55% | 0.55% | 0.55% | 0.55% | 0.55% | ||||||||
Net investment income and net realized gain (loss) | 1.63%5 | 2.87% | 3.03% | 2.21% | 0.91% | 0.55% | ||||||||
Supplemental Data | ||||||||||||||
Net assets, end of period (000) | $ 9,921,643 | $11,003,605 | $ 9,257,629 | $ 8,761,108 | $ 9,029,274 | $ 9,522,055 | ||||||||
1 | Amount is less than $0.01 per share. |
2 | Amount is less than $(0.01) per share. |
3 | Aggregate total investment return. |
4 | Includes the Fund’s share of the Master LLC’s allocated expenses and/or net investment income and net realized gain (loss). |
5 | Annualized. |
See Notes to Financial Statements. |
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
7 |
Notes to Financial Statements (Unaudited) CMA Tax-Exempt Fund |
1. Significant Accounting Policies:
CMA Tax-Exempt Fund (the “Fund”) is registered under the Investment
Company Act of 1940, as amended (the “1940 Act”), as a no load,
diversified, open-end management investment company. The Fund seeks
to achieve its investment objective by investing all of its assets in Master
Tax-Exempt LLC (the “Master LLC”), which has the same investment
objective and strategies as the Fund. The value of the Fund’s investment
in the Master LLC reflects the Fund’s proportionate interest in the net
assets of the Master LLC. The performance of the Fund is directly affect-
ed by the performance of the Master LLC. The financial statements of
the Master LLC, including the Schedule of Investments, are included
elsewhere in this report and should be read in conjunction with the
Fund’s financial statements. The Fund’s financial statements are pre-
pared in conformity with accounting principles generally accepted in the
United States of America, which may require the use of management
accruals and estimates. Actual results may differ from these estimates.
The percentage of the Master LLC owned by the Fund at September 30,
2008 was 90.4% .
The following is a summary of significant accounting policies followed
by the Fund:
Valuation of Investments: The Fund records its investment in the
Master LLC at fair value. Valuation of securities held by the Master LLC is
discussed in Note 1 of the Master LLC’s Notes to Financial Statements,
which are included elsewhere in this report. The Fund seeks to maintain
the net asset value per share at $1.00, although there is no assurance
that it will be able to do so on a continuing basis.
Effective April 1, 2008, the Fund adopted Financial Accounting
Standards Board Statement of Financial Accounting Standards No. 157,
“Fair Value Measurements” (“FAS 157”). FAS 157 clarifies the definition
of fair value, establishes a framework for measuring fair values and
requires additional disclosures about the use of fair value measure-
ments. Various inputs are used in determining the fair value of invest-
ments, which are as follows:
•Level 1 — price quotations in active markets/exchanges for
identical securities
•Level 2 — other observable inputs (including, but not limited to:
quoted prices for similar assets or liabilities in markets that are not
active, inputs other than quoted prices that are observable for the
assets or liabilities (such as interest rates, yield curves, volatilities,
prepayment speeds, loss severities, credit risks, and default rates)
or other market-corroborated inputs)
•Level 3 — unobservable inputs based on the best information avail-
able in the circumstance, to the extent observable inputs are not
available (including the Fund’s own assumption used in determining
the fair value of investments)
The inputs or methodology used for valuing securities are not necessarily
an indication of the risk associated with investing in those securities.
The following table summarizes the inputs used as of September 30,
2008 in determining the fair valuation of the Fund’s investments:
Valuation | Investments in | |
Inputs | Securities | |
Level 1 | — | |
Level 2 | $9,924,866,118 | |
Level 3 | — | |
Total | $9,924,866,118 | |
Investment Transactions and Net Investment Income: Investment trans-
actions in the Master LLC are accounted for on a trade date basis. The
Fund records daily its proportionate share of the Master LLC’s income,
expenses and realized gains and losses. In addition, the Fund accrues
its own expenses.
Dividends and Distributions to Shareholders: Dividends from net
investment income are declared and reinvested daily and paid
monthly. Distributions of realized gains, if any, are recorded on the
ex-dividend dates.
Income Taxes: It is the Fund’s policy to comply with the requirements of
the Internal Revenue Code applicable to regulated investment compa-
nies and to distribute substantially all of its taxable income to its share-
holders. Therefore, no federal income tax provision is required.
The Fund files U.S. federal and various state and local tax returns. No
income tax returns are currently under examination. The statute of limita-
tions on the Fund’s U.S. federal tax returns remains open for the years
ended March 31, 2005 through March 31, 2007. The statutes of limita-
tions on the Fund’s state and local tax returns may remain open for an
additional year depending upon the jurisdiction.
Recent Accounting Pronouncement: In March 2008, Statement of
Financial Accounting Standards No. 161, “Disclosures about Derivative
Instruments and Hedging Activities — an amendment of FASB Statement
No. 133” (“FAS 161”), was issued. FAS 161 is intended to improve
financial reporting for derivative instruments by requiring enhanced dis-
closure that enables investors to understand how and why an entity uses
8 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Notes to Financial Statements (concluded) CMA Tax-Exempt Fund |
derivatives, how derivatives are accounted for, and how derivative instru- ments affect an entity’s results of operations and financial position. In September 2008, FASB Staff Position No. 133-1 and FASB Interpretation No. 45-4 (the “FSP”), “Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No. 133 and FASB Interpretation No. 45; and Clarification of the Effective Date of FASB Statement No. 161” was issued and is effective for fiscal years and interim periods ending after November 15, 2008. The FSP amends FASB Statement No. 133, “Accounting for Derivative Instruments and Hedging Activities,” to require disclosures by sellers of credit derivatives, including credit derivatives embedded in hybrid instruments. The FSP also clarifies the effective date of FAS 161, whereby disclosures required by FAS 161 are effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The impact on the Fund’s financial statement disclosures, if any, is currently being assessed. Other: Expenses directly related to the Fund or its classes are charged to that Fund or class. Other operating expenses shared by several funds are pro-rated among those funds on the basis of relative net assets or other appropriate methods. 2. Transactions with Affiliates: The Fund has entered into an Administration Agreement with BlackRock Advisors, LLC (the “Administrator”), an indirect, wholly owned subsidiary of BlackRock, Inc., to provide administrative services (other than invest- ment advice and related portfolio activities). For such services, the Fund pays the Administrator a monthly fee at an annual rate of 0.25% of the average daily value of the Fund’s net assets. Merrill Lynch & Co., Inc. (“Merrill Lynch”) and The PNC Financial Services Group, Inc. (“PNC”) are principal owners of BlackRock, Inc. The Fund has entered into a Distribution Agreement and a Distribution and Shareholder Servicing Plan (the “Distribution Plan”) with Merrill Lynch, Pierce, Fenner and Smith Incorporated (“MLPF&S”), a wholly owned subsidiary of Merrill Lynch. Pursuant to the Distribution Plan adopted by the Fund in accordance with Rule 12b-1 under the 1940 Act, the Fund pays MLPF&S an ongoing distribution fee accrued daily and paid monthly at the annual rate of 0.125% of the average daily value of the Fund’s net assets for share- holders whose Fund accounts are serviced by MLPF&S or directly with the Fund’s transfer agent. |
Financial Data Services, Inc. (“FDS”), a wholly owned subsidiary of Merrill Lynch and an affiliate of the Administrator, serves as transfer agent. Interest is earned by the Fund from FDS based on the difference, if any, between estimated and actual daily share activity, which results in univested net proceeds from sales of Fund shares. This is shown as income from affiliates on the Statement of Operations. Certain officers and/or directors of the Fund are officers and/or directors of BlackRock, Inc. or its affiliates. The Fund reimburses the Administrator for compensation paid to the Fund’s Chief Compliance Officer. 3. Capital Share Transactions: The number of shares sold, reinvested and redeemed during the periods corresponds to the amounts included in the Statements of Changes in Net Assets with respect to net proceeds from sale of shares, value of shares issued in reinvestment of dividends and cost of shares redeemed, respectively, since shares are recorded at $1.00 per share. 4. Subsequent Events: On September 15, 2008, Bank of America Corporation announced that it has agreed to acquire Merrill Lynch, one of the principal owners of BlackRock, Inc. The purchase has been approved by the directors of both companies. Subject to shareholder and regulatory approvals, the trans- action is expected to close on or before December 31, 2008. Effective October 1, 2008, BlackRock Investments, Inc., an affiliate of the Administrator, replaced MLPF&S as the sole distributor of the Fund. The distribution fees will not change as a result of this transaction. On October 9, 2008, the Board approved the Fund’s participation in the U.S. Treasury Department’s Temporary Guarantee Program for Money Market Funds (the “Program”). As a result of the Fund’s participation in the Program, shareholders will have federal insurance up to the lesser amount of a shareholder’s balance in the Fund as of the close of busi- ness on September 19, 2008, or the amount held in the Fund on the date that a claim is filed for payment under the Program. Any increase in the number of shares in a shareholder’s balance after the close of busi- ness on September 19, 2008 and any future investments after a share- holder has closed their account will not be guaranteed. As a participant of the program, which expires December 18, 2008, the Fund has paid a participation fee of 0.01% of the Fund’s shares outstanding as of September 19, 2008. |
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
9 |
Portfolio Summary Master Tax-Exempt LLC Portfolio Composition1 |
1 Based on total market value of Master Tax-Exempt LLC as of September 30, 2008. Investments are valued at amortized cost, which
approximates market value.
10 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
Schedule of Investments September 30, 2008 (Unaudited) | Master Tax-Exempt LLC | |||||||||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||||||||
Par | Par | |||||||||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||||||||
Alabama — 1.6% | Arizona (concluded) | |||||||||||||||||
Alabama, HFA, S/F Mortgage Revenue Bonds, | Morgan Keegan Municipal Products, Inc., Maricopa | |||||||||||||||||
VRDN, AMT, Series H, 8.35%, 5/01/10 (a)(n) | $ 50,000 | $ 50,000,000 | County, Arizona, IDA, VRDN, AMT, Series A, | |||||||||||||||
Bank of America MACON Trust, Spanish Fort | 8.16%, 2/02/09 (a)(b)(n) | $ 22,475 | $ 22,475,000 | |||||||||||||||
Redevelopment Authority, Alabama, Revenue Bonds, | Salt River Pima-Maricopa Indian Community, Arizona, | |||||||||||||||||
VRDN, Series 2007-306, 8%, 3/01/12 (a)(b)(n) | 15,450 | 15,450,000 | Revenue Bonds, VRDN (a)(n): | |||||||||||||||
Lower Alabama Gas District, Gas Supply Revenue | 7.25%, 10/01/25 | 16,419 | 16,419,000 | |||||||||||||||
Bonds, VRDN, Series A, 7.25%, 11/01/27 (a)(n) | 50,000 | 50,000,000 | 7.25%, 10/01/26 | 34,650 | 34,650,000 | |||||||||||||
Millport, Alabama, IDA, Revenue Bonds (Steel | Scottsdale, Arizona, IDA, Hospital Revenue Refunding | |||||||||||||||||
Dust Recycling LLC Project), VRDN, AMT, | Bonds (Scottsdale Healthcare), VRDN, Series C, | |||||||||||||||||
8.11%, 12/01/37 (a)(n) | 10,000 | 10,000,000 | 8.05%, 9/01/35 (a)(c)(n) | 5,900 | 5,900,000 | |||||||||||||
Mobile, Alabama, IDB, PCR (Alabama Power | 213,124,000 | |||||||||||||||||
Company-Barry Plant Project), VRDN, | ||||||||||||||||||
2%, 7/15/09 (a)(n) | 10,100 | 10,100,000 | Arkansas — 0.2% | |||||||||||||||
Southeast Alabama Gas District, Alabama, Supply | Arkansas State Development Finance Authority, | |||||||||||||||||
Project Revenue Bonds, VRDN, Series A, | M/F Housing Revenue Bonds (Chapelridge Benton | |||||||||||||||||
4.25%, 8/01/27 (a)(n) | 31,999 | 31,999,000 | Project), VRDN, AMT, Series C, 8.11%, 6/01/32 (a)(n) | 7,800 | 7,800,000 | |||||||||||||
Stevenson, Alabama, IDB, Environmental | Morgan Keegan Municipal Products, Inc., Arkansas | |||||||||||||||||
Improvement Revenue Refunding Bonds (Mead | State Development Finance Authority, | |||||||||||||||||
Corporation Project), VRDN, AMT, Series A, | S/F Mortgage Revenue Bonds, VRDN, Series C, | |||||||||||||||||
8.20%, 2/01/34 (a)(n) | 5,100 | 5,100,000 | 8.16%, 6/01/11 (a)(b)(n) | 20 | 20,000 | |||||||||||||
Northwest Arkansas Regional Airport Authority, Airport | ||||||||||||||||||
172,649,000 | Revenue Refunding Bonds, VRDN, AMT, Series A, | |||||||||||||||||
Alaska — 0.5% | 8.11%, 2/01/21 (a)(n) | 12,280 | 12,280,000 | |||||||||||||||
Valdez, Alaska, Marine Terminal Revenue Bonds | 20,100,000 | |||||||||||||||||
(ConocoPhillips Project), VRDN, Series A, | ||||||||||||||||||
8%, 5/01/31 (a)(n) | 38,000 | 38,000,000 | California — 2.4% | |||||||||||||||
Valdez, Alaska, Marine Terminal Revenue Refunding | California HFA, M/F Housing Revenue Bonds, VRDN, | |||||||||||||||||
Bonds (ConocoPhillips Project), VRDN, Series B, | AMT, Series C, 4.25%, 8/01/38 (a)(n) | 13,820 | 13,820,000 | |||||||||||||||
8%, 5/01/31 (a)(n) | 20,000 | 20,000,000 | California Home Mortgage Financing Authority, | |||||||||||||||
Homebuyers Fund S/F Revenue Refunding Bonds, | ||||||||||||||||||
58,000,000 | VRDN, AMT, 2.49%, 6/01/09 (a)(n) | 28,544 | 28,543,400 | |||||||||||||||
Arizona — 1.9% | California Municipal Finance Authority, M/F Housing | |||||||||||||||||
Apache County, Arizona, IDA, IDR (Tucson Electric | Revenue Bonds, PUTTERS, VRDN, AMT, Series 2410, | |||||||||||||||||
Power Co.), VRDN, Series 83-A, 8%, | 5.80%, 1/01/20 (a)(b)(n) | 7,130 | 7,130,000 | |||||||||||||||
12/15/18 (a)(n) | 33,000 | 33,000,000 | California State, CP, 1.40%, 11/03/08 | 30,000 | 30,000,000 | |||||||||||||
Arizona Health Facilities Authority Revenue Bonds, | California State, GO, MERLOTS, VRDN, Series B-45, | |||||||||||||||||
VRDN (a)(n): | 5.40%, 10/01/29 (a)(b)(n) | 7,795 | 7,795,000 | |||||||||||||||
(Banner Health), Series C, 8%, 1/01/35 | 4,300 | 4,300,000 | Los Angeles, California, GO, TRAN, 3%, 6/30/09 | 57,100 | 57,709,725 | |||||||||||||
(Banner Health System), Series F, 8%, 1/01/29 | 77,940 | 77,940,000 | Sacramento County, California, GO, TRAN, | |||||||||||||||
Maricopa County, Arizona, IDA, Health Facilities | 2.50%, 8/07/09 | 107,100 | 107,918,033 | |||||||||||||||
Revenue Bonds, PUTTERS, VRDN, Series 420, | San Francisco, California, City and County | |||||||||||||||||
5.22%, 1/01/10 (a)(b)(n) | 10,000 | 10,000,000 | Redevelopment Agency, M/F Housing Revenue | |||||||||||||||
Maricopa County, Arizona, Public Finance Corporation, | Bonds (Notre Dame Apartments), VRDN, AMT, | |||||||||||||||||
Lease Revenue Bonds, FLOATS, VRDN, Series 1863, | Series G, 7.90%, 12/01/33 (a)(n) | 14,540 | 14,540,000 | |||||||||||||||
4.60%, 7/01/31 (a)(b)(n) | 8,440 | 8,440,000 | 267,456,158 | |||||||||||||||
Portfolio Abbreviations | ||||||||||||||||||
AMT | Alternative Minimum Tax (subject to) | IDA | Industrial Development Authority | PUTTERS | Puttable Tax-Exempt Receipts | |||||||||||||
BAN | Bond Anticipation Notes | IDB | Industrial Development Board | RACS | Revenue Anticipation Certificates | |||||||||||||
COP | Certificates of Participation | IDR | Industrial Development Revenue Bonds | ROCS | Reset Option Certificates | |||||||||||||
CP | Commercial Paper | LIFERS | Long Inverse Floating Exempt Receipts | S/F | Single-Family | |||||||||||||
EDA | Economic Development Authority | M/F | Multi-Family | SPEARS | Short Puttable Exempt Adjustable | |||||||||||||
EDR | Economic Development Revenue Bonds | MERLOTS | Municipal Exempt Receipts Liquidity | Receipts | ||||||||||||||
FLOATS | Floating Rate Securities | Optional Tenders | TAN | Tax Anticipation Notes | ||||||||||||||
GO | General Obligation Bonds | MSTR | Municipal Securities Trust Receipts | TRAN | Tax Revenue Anticipation Notes | |||||||||||||
HDA | Housing Development Authority | PCR | Pollution Control Revenue Bonds | VRDN | Variable Rate Demand Notes | |||||||||||||
HFA | Housing Finance Agency | |||||||||||||||||
See Notes to Financial Statements. | ||||||||||||||||||
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
11 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||
Par | Par | |||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||
Colorado — 3.6% | Connecticut — 0.7% | |||||||||||
Aurora, Colorado, COP, Refunding, VRDN, | Bank of America AUSTIN Trust, Connecticut State | |||||||||||
6.50%, 12/01/30 (a)(n) | $ 14,000 $ | 14,000,000 | Revenue Bonds, VRDN, Series 2008-1080, | |||||||||
Colorado Department of Transportation Revenue | 6.32%, 7/01/42 (a)(b)(n) | $ 6,175 $ | 6,175,000 | |||||||||
Refunding Bonds, PUTTERS, VRDN, Series 318, | Connecticut State Health and Educational Facilities | |||||||||||
4.75%, 6/15/15 (a)(b)(d)(n) | 8,715 | 8,715,000 | Authority Revenue Bonds, VRDN (a)(n): | |||||||||
Colorado Educational and Cultural Facilities Authority | PUTTERS, Series 2992, 4.25%, 7/01/15 (b) | 10,235 | 10,235,000 | |||||||||
Revenue Bonds (The Nature Conservancy Project), | (Yale University), Series U, 7.80%, 7/01/33 | 28,735 | 28,735,000 | |||||||||
VRDN, Series A, 7.25%, 7/01/33 (a)(n) | 8,600 | 8,600,000 | Connecticut State Health and Educational Facilities | |||||||||
Colorado HFA, S/F Mortgage Revenue Bonds, VRDN, | Authority, Revenue Refunding Bonds (Danbury | |||||||||||
AMT, Series B-2, Class I, 7.75%, 5/01/38 (a)(n) | 25,000 | 25,000,000 | Hospital), VRDN, Series J, 7.47%, 7/01/36 (a)(n) | 15,900 | 15,900,000 | |||||||
Colorado Health Facilities Authority Revenue Bonds, | Greenwich, Connecticut, GO, BAN, 3.50%, 1/29/09 | 10,000 | 10,048,599 | |||||||||
VRDN (a)(n): | 71,093,599 | |||||||||||
(Catholic Health Initiatives), Series B, | ||||||||||||
7.95%, 12/01/20 | 34,600 | 34,600,000 | Delaware — 1.2% | |||||||||
(Sisters of Charity of Leavenworth Health System), | Delaware State, EDA, Revenue Bonds (Hospital | |||||||||||
7.93%, 12/01/32 | 19,300 | 19,300,000 | Billing and Collection), VRDN (a)(n): | |||||||||
Colorado Health Facilities Authority, Revenue | Series A, 8.02%, 12/01/15 | 30,550 | 30,550,000 | |||||||||
Refunding Bonds, VRDN (a)(n): | Series C, 8%, 12/01/15 | 103,950 | 103,950,000 | |||||||||
(Catholic Health Initiatives), Series B-1, | 134,500,000 | |||||||||||
8%, 3/01/23 | 3,490 | 3,490,000 | District of Columbia — 1.0% | |||||||||
(Catholic Health Initiatives), Series B-3, | Deutsche Bank SPEARs/LIFERs Trust, District of | |||||||||||
7.98%, 3/01/23 | 17,870 | 17,870,000 | Columbia, GO, SPEARs, VRDN, AMT, Series DB-463, | |||||||||
(Catholic Health Initiatives), Series B-6, | 4.08%, 12/01/17 (a)(b)(c)(n) | 8,475 | 8,475,000 | |||||||||
8%, 3/01/44 | 7,900 | 7,900,000 | District of Columbia, CP, 1.52%, 10/24/08 | 35,900 | 35,900,000 | |||||||
(Sisters of Charity of Leavenworth Health | District of Columbia, GO, MERLOTS, VRDN, | |||||||||||
System), Series A, 7.93%, 12/01/38 | 24,470 | 24,470,000 | Series D75, 4.13%, 12/01/17 (a)(b)(c)(n) | 9,605 | 9,605,000 | |||||||
Colorado Housing and Finance Authority, S/F | District of Columbia, GO, Refunding, VRDN (a)(n): | |||||||||||
Mortgage Revenue Bonds, VRDN, AMT, Class I, | Series A, 7.25%, 6/01/34 | 4,295 | 4,295,000 | |||||||||
Series B-3, 7.75%, 11/01/26 (a)(n) | 45,300 | 45,300,000 | Series B, 7.25%, 6/01/34 | 6,120 | 6,120,000 | |||||||
Colorado Housing and Finance Authority, S/F | Series C, 7.95%, 6/01/26 | 6,555 | 6,555,000 | |||||||||
Mortgage Revenue Refunding Bonds, VRDN, AMT, | Series C, 6.50%, 6/01/27 | 9,000 | 9,000,000 | |||||||||
Class I, Series B-3, 7.75%, 11/01/36 (a)(n) | 44,000 | 44,000,000 | Series D, 7.50%, 6/01/34 | 8,390 | 8,390,000 | |||||||
Colorado School of Mines Development | District of Columbia, HFA, S/F Mortgage Revenue | |||||||||||
Corporation, Revenue Refunding Bonds, VRDN, | Bonds, VRDN, AMT, Series B, 3.55%, | |||||||||||
8.23%, 9/01/26 (a)(n) | 6,300 | 6,300,000 | 11/03/08 (a)(n) | 6,000 | 6,000,000 | |||||||
Colorado School of Mines, Enterprise | District of Columbia, Revenue Refunding | |||||||||||
Revenue Refunding Bonds, VRDN, Series A, | Bonds (Howard University), VRDN, Series B, | |||||||||||
8.25%, 12/01/37 (a)(n) | 8,000 | 8,000,000 | 6.50%, 10/01/26 (a)(n) | 5,000 | 5,000,000 | |||||||
Colorado Springs, Colorado, School District | District of Columbia, University Revenue Bonds | |||||||||||
Number 11 Facilities Corporation, COP, Refunding, | (American University), VRDN, 7.25%, | |||||||||||
8.35%, 12/01/17 (c) | 8,290 | 8,290,000 | 6/01/33 (a)(n) | 7,400 | 7,400,000 | |||||||
Colorado Springs, Colorado, Utilities Revenue | District of Columbia, Water and Sewer Authority, | |||||||||||
Refunding Bond, Sub-Lien, VRDN, Series A, | Revenue Refunding Bonds, PUTTERS, VRDN, | |||||||||||
8.15%, 11/01/23 (a)(n) | 34,875 | 34,875,000 | Series 2838, 6.28%, 10/01/15 (a)(b)(c)(n) | 8,000 | 8,000,000 | |||||||
Colorado State, General Fund, GO, TRAN, | ||||||||||||
3%, 6/26/09 | 57,800 | 58,348,371 | 114,740,000 | |||||||||
Eclipse Funding Trust, Solar Eclipse Certificates, | Florida — 6.2% | |||||||||||
El Paso County, Colorado, School District, COP, VRDN, | Alachua County, Florida, Health Facilities Authority, | |||||||||||
Series 2006-0101, 4.54%, 12/15/28 (a)(b)(d)(n) | 11,190 | 11,190,000 | Health Facilities Revenue Bonds (Shands Teaching | |||||||||
Pitkin County, Colorado, IDR, Refunding (Aspen | Hospital and Clinics, Inc. Project), VRDN, Series A, | |||||||||||
Skiing Company Project), VRDN, AMT, Series B, | 4.30%, 12/01/32 (a)(n) | 5,700 | 5,700,000 | |||||||||
4.75%, 4/01/14 (a)(n) | 2,900 | 2,900,000 | Brevard County, Florida, Health Facilities Authority, | |||||||||
University of Colorado Hospital Authority Revenue | Healthcare Facilities Revenue Refunding | |||||||||||
Bonds, ROCS, VRDN, Series II-R-573CE, | Bonds (Health First Inc. Project), VRDN, | |||||||||||
5.48%, 11/15/40 (a)(b)(n) | 6,500 | 6,500,000 | 4.30%, 8/01/14 (a)(n) | 4,075 | 4,075,000 | |||||||
389,648,371 | Deutsche Bank SPEARs/LIFERs Trust, Saint Johns | |||||||||||
County, Florida, Revenue Bonds, SPEARs, VRDN, | ||||||||||||
Series DB-486, 4.08%, 10/01/16 (a)(b)(n) | 8,980 | 8,980,000 | ||||||||||
Eagle Tax-Exempt Trust, Miami-Dade County, | ||||||||||||
Florida, Aviation Revenue Bonds, VRDN, | ||||||||||||
AMT, Series 2007-0108, Class A, | ||||||||||||
8.27%, 10/01/39 (a)(b)(e)(n) | 14,380 | 14,380,000 |
See Notes to Financial Statements. 12 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||
Par | Par | |||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||
Florida (continued) | Florida (concluded) | |||||||||||
Eagle Tax-Exempt Trust, Orlando-Orange County | Jacksonville Electric Authority, Florida, Water and | |||||||||||
Expressway Authority, Florida, Expressway Revenue | Sewer System Revenue Bonds, VRDN, Series A-1, | |||||||||||
Bonds, VRDN, Series 2007-0145, Class A, | 8%, 10/01/36 (a)(n) | $ 30,400 | $ 30,400,000 | |||||||||
8.73%, 7/01/17 (a)(b)(c)(n) | $ 11,300 | $ 11,300,000 | Jacksonville Electric Authority, Florida, Water and | |||||||||
Eagle Tax-Exempt Trust, South Florida | Sewer System, Revenue Refunding Bonds, VRDN, | |||||||||||
Water Management District, COP, | Sub-Series A-2, 6.50%, 10/01/38 (a)(n) | 7,110 | 7,110,000 | |||||||||
VRDN, Series 2006-0136, Class A, | Jacksonville, Florida, Electric Authority Revenue | |||||||||||
8.49%, 10/01/36 (a)(b)(c)(n) | 19,730 | 19,730,000 | Bonds (Electric System), VRDN, Series B, | |||||||||
Eclipse Funding Trust, Solar Eclipse Certificates, | 4.25%, 10/01/30 (a)(n) | 2,000 | 2,000,000 | |||||||||
Fort Pierce, Florida, Redevelopment Agency, Tax | Jacksonville, Florida, Health Facilities Authority, | |||||||||||
Allocation Bonds, VRDN, Series 2006-0130, | Hospital Revenue Bonds (Southern Baptist | |||||||||||
4.20%, 5/01/31 (a)(b)(n) | 3,940 | 3,940,000 | Hospital), VRDN, Series A, 4.30%, 8/15/33 (a)(n) | 11,320 | 11,320,000 | |||||||
Eclipse Funding Trust, Solar Eclipse Certificates, | Jacksonville, Florida, Port Authority Revenue Bonds | |||||||||||
Volusia County, Florida, School Board, COP, VRDN, | (Mitsui O.S.K. Lines, Ltd. Project), VRDN, AMT, | |||||||||||
Series 2007-0036, 4.08%, 8/01/32 (a)(b)(c)(n) | 7,390 | 7,390,000 | 8%, 11/01/32 (a)(n) | 15,000 | 15,000,000 | |||||||
Florida Gas Utility Revenue Bonds (Gas | Jacksonville, Florida, Transit Revenue Refunding | |||||||||||
Supply Project Number 2), VRDN, Series A-3, | Bonds, VRDN (a)(n): | |||||||||||
8.07%, 11/01/26 (a)(n) | 84,935 | 84,935,000 | Series A, 6.50%, 10/01/32 | 54,035 | 54,035,000 | |||||||
Florida Higher Educational Facilities Financing | Series B, 7.92%, 10/01/27 | 3,000 | 3,000,000 | |||||||||
Authority Revenue Bonds (Ringling College), VRDN, | Lakeland, Florida, Energy System Revenue | |||||||||||
7.90%, 3/01/38 (a)(n) | 9,000 | 9,000,000 | Refunding Bonds, VRDN (a)(n): | |||||||||
Florida Housing Finance Corporation, M/F Mortgage | Series A, 7.70%, 10/01/37 | 5,000 | 5,000,000 | |||||||||
Revenue Bonds, ROCS, VRDN, Series II-R-600CE, | Series B, 4.30%, 10/01/37 | 3,900 | 3,900,000 | |||||||||
5.50%, 7/01/43 (a)(b)(n) | 5,480 | 5,480,000 | Miami-Dade County, Florida, Water and Sewer | |||||||||
Florida Hurricane Catastrophe Fund Finance | Revenue Refunding Bonds, VRDN (a)(c)(n): | |||||||||||
Corporation Revenue Bonds, ROCS, VRDN, | 8.40%, 10/01/25 | 40,000 | 40,000,000 | |||||||||
Series II-R-11549, 4.32%, 7/01/13 (a)(b)(n) | 7,000 | 7,000,000 | ROCS, Series II-R-1092, 5%, 10/01/22 (b) | 8,380 | 8,380,000 | |||||||
Florida State Board of Education, GO, ROCS, | Orange County, Florida, Health Facilities Authority, | |||||||||||
VRDN (a)(b)(n): | Hospital Revenue Bonds (Adventist Health | |||||||||||
Series II-R-3086, 4.32%, 6/01/28 | 4,400 | 4,400,000 | System), VRDN, 8%, 11/15/14 (a)(n) | 1,300 | 1,300,000 | |||||||
Series II-R-12067, 4.63%, 6/01/15 | 15,500 | 15,500,000 | Orange County, Florida, Health Facilities Authority, | |||||||||
Series II-R-12211, 8.27%, 6/01/13 | 8,000 | 8,000,000 | Hospital Revenue Refunding Bonds (Orlando | |||||||||
Florida State Board of Education, GO, | Regional Healthcare), VRDN (a)(n): | |||||||||||
Refunding, ROCS, VRDN, Series II-R-6087, | Series E, 7.90%, 10/01/26 | 5,500 | 5,500,000 | |||||||||
4.54%, 6/01/14 (a)(b)(n) | 3,455 | 3,455,000 | Series F, 8%, 10/01/26 | 5,800 | 5,800,000 | |||||||
Florida State Turnpike Authority, Turnpike Revenue | Orlando, Florida, Utilities Commission, Water | |||||||||||
Refunding Bonds, PUTTERS, VRDN, Series 2539, | and Electric Revenue Bonds, VRDN, Series B, | |||||||||||
5.85%, 7/01/15 (a)(b)(n) | 4,000 | 4,000,000 | 7.89%, 10/01/22 (a)(n) | 25,300 | 25,300,000 | |||||||
Gainesville, Florida, Utilities System Revenue | Palm Beach County, Florida, Educational Facilities | |||||||||||
Refunding Bonds, VRDN, Series C, | Authority Revenue Bonds (Atlantic University Inc. | |||||||||||
4.25%, 10/01/26 (a)(n) | 27,735 | 27,735,000 | Project), VRDN, 7.25%, 4/01/33 (a)(n) | 10,000 | 10,000,000 | |||||||
Highlands County, Florida, Health Facilities Authority, | Palm Beach County, Florida, Health Facilities | |||||||||||
Hospital Revenue Bonds (Adventist Health System), | Authority, CP, 1.64%, 11/04/08 | 10,000 | 10,000,000 | |||||||||
VRDN (a)(n): | Pembroke Pines, Florida, Charter School Revenue | |||||||||||
Series A-2, 8%, 11/15/37 | 13,500 | 13,500,000 | Refunding Bonds, VRDN, 8.15%, 7/01/38 (a)(f)(n) | 10,000 | 10,000,000 | |||||||
Series C, 8%, 11/15/37 | 7,100 | 7,100,000 | Polk County, Florida, IDA, IDR, Refunding (Winter | |||||||||
Highlands County, Florida, Health Facilities Authority, | Haven Hospital Project), VRDN, Series B, | |||||||||||
Hospital Revenue Refunding Bonds (Adventist | 4.30%, 9/01/34 (a)(n) | 3,890 | 3,890,000 | |||||||||
Health System), VRDN (a)(n): | Saint Johns County, Florida, Sales Tax Revenue | |||||||||||
Series B-2, 10%, 11/15/30 | 5,000 | 5,000,000 | Bonds, ROCS, VRDN, Series II-R-755PB, | |||||||||
Series C, 8%, 11/15/21 | 6,000 | 6,000,000 | 4.11%, 10/01/36 (a)(b)(d)(e)(n) | 6,065 | 6,065,000 | |||||||
Jacksonville Electric Authority, Florida, CP: | Volusia County, Florida, IDA, Revenue Refunding | |||||||||||
1.65%, 10/09/08 | 50,300 | 50,300,000 | Bonds (Retirement Housing Foundation), VRDN, | |||||||||
1.72%, 12/11/08 | 30,300 | 30,300,000 | 8.05%, 9/01/25 (a)(n) | 7,500 | 7,500,000 | |||||||
Jacksonville Electric Authority, Florida, Electric System | 678,730,000 | |||||||||||
Revenue Refunding Bonds, VRDN (a)(n): | ||||||||||||
Series 3-B-1, 7.95%, 10/01/40 | 6,095 | 6,095,000 | ||||||||||
Series 3-B-2, 7.95%, 10/01/40 | 6,135 | 6,135,000 | ||||||||||
Series 3-B-3, 7.95%, 10/01/36 | 8,800 | 8,800,000 | ||||||||||
Series 3-C-2, 7.80%, 10/01/34 | 15,000 | 15,000,000 | ||||||||||
Series B, 7.80%, 10/01/31 | 20,000 | 20,000,000 |
See Notes to Financial Statements. CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 13 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||||
Par | Par | |||||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||||
Georgia — 1.5% | Idaho — 0.3% | |||||||||||||
Atlanta, Georgia, Urban Residential Finance Authority, | Idaho State Building Authority, Revenue Refunding | |||||||||||||
M/F Housing Revenue Bonds (Lindbergh City | Bonds (Prison Facilities Project), VRDN, Series A, | |||||||||||||
Center Apartment Project), VRDN, AMT, | 7.75%, 9/01/25 (a)(n) | $ 14,000 | $ 14,000,000 | |||||||||||
8.16%, 11/01/44 (a)(n) | $ 4,000 | $ 4,000,000 | Idaho State, GO, TAN, 3%, 6/30/09 | 18,000 | 18,169,290 | |||||||||
Atlanta, Georgia, Water and Wastewater | 32,169,290 | |||||||||||||
Revenue Refunding Bonds, VRDN, Series B, | ||||||||||||||
8.50%, 11/01/38 (a)(c)(n) | 3,530 | 3,530,000 | Illinois — 5.6% | |||||||||||
Bank of America MACON Trust, Georgia Municipal | ABN AMRO MuniTops Certificates Trust, Du Page and | |||||||||||||
Electric Authority, Power Revenue Bonds, VRDN, | Will Counties, Illinois, Community School District | |||||||||||||
Series E, 3.95%, 1/01/17 (a)(b)(c)(n) | 6,815 | 6,815,000 | Number 204 (Indian Prairie), GO, VRDN, Series | |||||||||||
Burke County, Georgia, Development Authority, PCR | 2006-33, 4.36%, 6/30/14 (a)(b)(d)(n) | 12,180 | 12,180,000 | |||||||||||
(Georgia Power Company Vogtle Project), VRDN (a)(n): | Bank of America MACON Trust, Illinois State, GO, | |||||||||||||
2nd Series, 4.30%, 10/01/32 | 10,000 | 10,000,000 | VRDN, Series L, 4.01%, 1/01/31 (a)(b)(n) | 1,750 | 1,750,000 | |||||||||
Refunding 1st Series, 2.10%, 9/01/30 | 5,100 | 5,100,000 | Chicago, Illinois, GO, Refunding, PUTTERS, VRDN, | |||||||||||
Clayton County, Georgia, Housing Authority, M/F | Series 3091, 4.78%, 1/01/16 (a)(b)(n) | 5,330 | 5,330,000 | |||||||||||
Housing Revenue Bonds (Provence Place | Chicago, Illinois, GO, ROCS, VRDN, Series II-R-12174, | |||||||||||||
Apartments Project), VRDN, 8.11%, 10/01/41 (a)(n) | 2,025 | 2,025,000 | 8.49%, 1/01/14 (a)(b)(c)(n) | 7,155 | 7,155,000 | |||||||||
Cobb County, Georgia, Development Authority, Solid | Chicago, Illinois, GO, VRDN, Series B, | |||||||||||||
Waste Disposal Revenue Bonds (Republic Services, | 8.25%, 1/01/12 (a)(n) | 6,490 | 6,490,000 | |||||||||||
Inc. Project), VRDN, AMT, 8.05%, 10/01/19 (a)(n) | 6,000 | 6,000,000 | Chicago, Illinois, O’Hare International Airport Revenue | |||||||||||
Eagle Tax-Exempt Trust, Atlanta, Georgia, Water | Bonds, VRDN (a)(b)(c)(n): | |||||||||||||
and Wastewater Revenue Bonds, VRDN, Series | PUTTERS, Series 2504, 5.25%, 1/01/15 | 1,715 | 1,715,000 | |||||||||||
2006-0130, Class A, 8.72%, 11/01/34 (a)(b)(c)(n) | 5,000 | 5,000,000 | ROCS, AMT, Series II-R-239, 6.61%, 1/01/22 | 3,700 | 3,700,000 | |||||||||
Fulton County, Georgia, Development Authority | Chicago, Illinois, Water Revenue Bonds, VRDN, | |||||||||||||
Revenue Bonds (Robert W. Woodruff Arts Center | Second Lien, 8%, 11/01/30 (a)(n) | 36,070 | 36,070,000 | |||||||||||
Project), VRDN, Series B, 7.90%, 4/01/34 (a)(n) | 21,200 | 21,200,000 | Cook County, Illinois, GO, ROCS, VRDN, | |||||||||||
Gainesville and Hall County, Georgia, Hospital | Series II-R-12030, 4.72%, 11/15/12 (a)(b)(c)(n) | 30,920 | 30,920,000 | |||||||||||
Authority, Revenue Refunding Bonds (Northeast | Deutsche Bank SPEARs/LIFERs Trust, Chicago, | |||||||||||||
Georgia Health System), VRDN, Series E, | Illinois, O’Hare International Airport Revenue Bonds, | |||||||||||||
7.91%, 5/01/41 (a)(n) | 16,600 | 16,600,000 | SPEARs, VRDN (a)(b)(n): | |||||||||||
Georgia State, GO, ROCS, VRDN (a)(b)(n): | Series DB-502, 4.18%, 1/01/33 (c) | 13,820 | 13,820,000 | |||||||||||
Series II-R-11536PB, 4.28%, 7/01/28 | 26,275 | 26,275,000 | Series DBE-534, 3.77%, 1/01/22 | 2,275 | 2,275,000 | |||||||||
Series II-R-11544, 3.66%, 7/01/24 | 2,035 | 2,035,000 | Eagle Tax-Exempt Trust, Illinois State Finance | |||||||||||
Gwinnett County, Georgia, Hospital Authority, Revenue | Authority, Revenue Refunding Bonds, VRDN, Series | |||||||||||||
Refunding Bonds (Gwinnett Hospital System | 2006-0118, Class A, 8.25%, 12/01/42 (a)(b)(n) | 3,150 | 3,150,000 | |||||||||||
Project), VRDN, Series C, 8%, 7/01/32 (a)(n) | 7,625 | 7,625,000 | Eagle Tax-Exempt Trust, Illinois State, GO, VRDN, Series | |||||||||||
Macon-Bibb County, Georgia, Hospital Authority | 2008-0021, Class A, 8.55%, 2/01/27 (a)(b)(c)(n) | 11,260 | 11,260,000 | |||||||||||
Revenue Bonds (Central Georgia Senior | Eagle Tax-Exempt Trust, University of Illinois, | |||||||||||||
Health, Inc. — Carlyle Place Project), VRDN, | University Revenue Refunding Bonds, VRDN, Series | |||||||||||||
4.30%, 5/01/30 (a)(n) | 17,885 | 17,885,000 | 2006-0124, Class A, 8.17%, 4/01/35 (a)(b)(d)(n) | 10,000 | 10,000,000 | |||||||||
Municipal Electric Authority, Georgia, Revenue | Eclipse Funding Trust, Solar Eclipse Certificates, | |||||||||||||
Refunding Bonds (Project One), VRDN, | Chicago, Illinois, GO, Refunding, VRDN, Series | |||||||||||||
Sub-Series B, 7.95%, 1/01/48 (a)(n) | 10,000 | 10,000,000 | 2006-0038, 4.14%, 1/01/28 (a)(b)(c)(n) | 10,700 | 10,700,000 | |||||||||
Putnam County, Georgia, Development Authority, PCR | Elmhurst, Illinois, Revenue Bonds (Joint Commission | |||||||||||||
(Georgia Power Company), VRDN, First Series 97, | on Accreditation of Healthcare Organizations), | |||||||||||||
2.10%, 7/14/09 (a)(n) | 4,000 | 4,000,000 | VRDN, 8.05%, 7/01/18 (a)(n) | 13,890 | 13,890,000 | |||||||||
Richmond County, Georgia, Hospital Authority, | Illinois Development Finance Authority, Revenue | |||||||||||||
Revenue Refunding Bonds (University | Refunding Bonds (Evanston Northwestern | |||||||||||||
Health Services, Inc. Project), VRDN, RACS, | Healthcare Corporation), VRDN, Series A, | |||||||||||||
7.90%, 1/01/36 (a)(n) | 10,000 | 10,000,000 | 7.93%, 5/01/31 (a)(n) | 19,885 | 19,885,000 | |||||||||
Whitfield County, Georgia, Development Authority, | Illinois Educational Facilities Authority Revenue | |||||||||||||
Solid Waste Disposal Revenue Bonds (Aladdin | Bonds (Art Institute of Chicago), VRDN, | |||||||||||||
Manufacturing Corporation Project), VRDN, AMT, | 7.98%, 3/01/27 (a)(n) | 11,450 | 11,450,000 | |||||||||||
8.75%, 6/01/19 (a)(n) | 3,100 | 3,100,000 | Illinois Educational Facilities Authority, Revenue | |||||||||||
Refunding Bonds (The Art Institute of Chicago), | ||||||||||||||
161,190,000 | VRDN, 7.98%, 3/01/27 (a)(n) | 23,600 | 23,600,000 | |||||||||||
Illinois Health Facilities Authority, CP, | ||||||||||||||
1.65%, 11/06/08 | 50,000 | 50,000,000 |
See Notes to Financial Statements. 14 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||
Par | Par | |||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||
Illinois (concluded) | Indiana — 3.8% | |||||||||||
Illinois Health Facilities Authority Revenue | DFA Municipal Trust, Indianapolis, Indiana, Local | |||||||||||
Bonds, VRDN (a)(n): | Public Improvement Bond Bank, Revenue | |||||||||||
(Northwestern Memorial Hospital), | Refunding Bonds, FLOATS, VRDN, Series 2008-47, | |||||||||||
7.93%, 8/15/25 | $ 16,570 | $ 16,570,000 | 6.50%, 1/01/35 (a)(b)(n) | $ 36,405 | $ 36,405,000 | |||||||
(Revolving Fund Pooled Program), Series D, | Fort Wayne, Indiana, Waterworks Utility Revenue | |||||||||||
7.95%, 8/01/15 | 39,850 | 39,850,000 | Notes, BAN, 1.80%, 2/11/09 | 17,840 | 17,840,000 | |||||||
Illinois State Finance Authority, PCR, Refunding | IPS Multi-School Building Corporation, Indiana, | |||||||||||
(Commonwealth Edison Company Project), | Revenue Bonds, ROCS, VRDN, Series II-R-885WF, | |||||||||||
VRDN (a)(n): | 5.75%, 1/15/30 (a)(b)(c)(n) | 7,465 | 7,465,000 | |||||||||
Series D, 7.85%, 3/01/20 | 5,600 | 5,600,000 | Indiana Bond Bank, Advance Funding Program | �� | ||||||||
Series F, 7.93%, 3/01/17 | 6,200 | 6,200,000 | Revenue Notes, Series A: | |||||||||
Illinois State Finance Authority Revenue Bonds, | 3%, 1/30/09 | 50,000 | 50,147,236 | |||||||||
VRDN (a)(n): | 3%, 5/28/09 | 40,700 | 41,008,357 | |||||||||
(Illinois Wesleyan University Project), | Indiana Health Facilities Financing Authority, Revenue | |||||||||||
6.50%, 9/01/23 | 2,500 | 2,500,000 | Refunding Bonds (Ascension Health Credit Group), | |||||||||
(Landing at Plymouth Place), Series C, | VRDN, Series A-2, 7.75%, 11/15/36 (a)(n) | 75,000 | 75,000,000 | |||||||||
8%, 5/15/37 | 26,430 | 26,430,000 | Indiana State Development Finance Authority, | |||||||||
(North Park University Project), 7.75%, 7/01/35 | 4,800 | 4,800,000 | Educational Facilities Revenue Bonds | |||||||||
(Northwestern University), Sub-Series A, | (Indianapolis Museum of Art, Inc. Project), VRDN, | |||||||||||
7.50%, 12/01/34 | 13,975 | 13,975,000 | 7.95%, 2/01/39 (a)(n) | 43,000 | 43,000,000 | |||||||
(Northwestern University), Sub-Series A, | Indiana State Development Finance Authority, | |||||||||||
7.75%, 12/01/46 | 4,075 | 4,075,000 | Environmental Revenue Bonds (PSI Energy | |||||||||
(University of Chicago), Series B, | Inc. Projects), VRDN, AMT, Series A, | |||||||||||
6.50%, 7/01/34 | 54,817 | 54,817,000 | 8.25%, 12/01/38 (a)(n) | 32,550 | 32,550,000 | |||||||
Illinois State Finance Authority, Revenue Refunding | Indiana State Financing Authority, Health System | |||||||||||
Bonds, VRDN (a)(n): | Revenue Bonds (Sisters of St. Francis Health | |||||||||||
(Central DuPage Health System), Series C, | Service, Inc. Project), VRDN, Series B, | |||||||||||
4.20%, 11/01/38 | 49,830 | 49,830,000 | 7.90%, 11/01/41 (a)(n) | 3,700 | 3,700,000 | |||||||
(Elmhurst Memorial Healthcare Project), Series B, | Indiana State Financing Authority, Lease Appropriation | |||||||||||
4.25%, 1/01/48 | 3,100 | 3,100,000 | Revenue Bonds, VRDN (a)(n): | |||||||||
(Elmhurst Memorial Healthcare Project), Series C, | Series A-2, 7.90%, 2/01/37 | 5,700 | 5,700,000 | |||||||||
8%, 1/01/48 | 5,000 | 5,000,000 | Series A-4, 8%, 2/01/35 | 18,000 | 18,000,000 | |||||||
(Riverside Health System), Series A, | Series A-5, 8%, 2/01/35 | 25,000 | 25,000,000 | |||||||||
8.20%, 11/15/22 | 15,275 | 15,275,000 | Indiana State Financing Authority, Lease Appropriation | |||||||||
(Riverside Health System), Series B, | Revenue Refunding Bonds, VRDN, Series A-2, | |||||||||||
8.20%, 11/15/20 | 16,225 | 16,225,000 | 6.50%, 2/01/39 (a)(n) | 5,000 | 5,000,000 | |||||||
Illinois State, GO, MERLOTS, VRDN, Series B04, | Indiana State Financing Authority, Revenue Refunding | |||||||||||
4.83%, 12/01/24 (a)(b)(c)(n) | 8,935 | 8,935,000 | Bonds (Ascension Health), VRDN, Series E-3, | |||||||||
Illinois State, GO, ROCS, VRDN, Series II-R-12080, | 7.80%, 11/15/36 (a)(n) | 7,000 | 7,000,000 | |||||||||
4.87%, 11/01/11 (a)(b)(c)(n) | 9,470 | 9,470,000 | Indiana University Revenue Bonds, PUTTERS, VRDN, | |||||||||
Illinois State Toll Highway Authority, Toll Highway | Series 2494, 6.66%, 12/15/15 (a)(b)(n) | 1,485 | 1,485,000 | |||||||||
Revenue Refunding Bonds, VRDN, Series B, | Pike County, Indiana, Multi-School Building | |||||||||||
8.35%, 1/01/17 (a)(c)(n) | 12,235 | 12,235,000 | Corporation, Revenue Refunding Bonds, PUTTERS, | |||||||||
Illinois State Toll Highway Authority, Toll Highway | VRDN, Series 1122, 5.25%, 7/15/12 (a)(b)(d)(n) | 5,345 | 5,345,000 | |||||||||
Senior Priority Revenue Bonds, VRDN, Series A-2, | Portage, Indiana, EDR (Breckenridge Apartments | |||||||||||
7.25%, 7/01/30 (a)(n) | 10,000 | 10,000,000 | Project), VRDN, AMT, 10%, 5/01/25 (a)(n) | 4,650 | 4,650,000 | |||||||
University of Illinois, COP (Utility Infrastructure | Saint Joseph County, Indiana, Industrial Educational | |||||||||||
Projects), Refunding, VRDN, 6.50%, 8/15/21 (a)(n) | 20,460 | 20,460,000 | Facilities Revenue Bonds (University of Notre Dame | |||||||||
Will County, Illinois, Exempt Facilities Revenue Bonds | du Lac Project), VRDN, 5.50%, 3/01/33 (a)(n) | 12,000 | 12,000,000 | |||||||||
(BP Amoco Chemical Company Project), VRDN, | Whiting, Indiana, Environmental Facilities Revenue | |||||||||||
AMT (a)(n): | Refunding Bonds, VRDN, AMT (a)(n): | |||||||||||
4.05%, 3/01/28 | 6,025 | 6,025,000 | (Amoco Oil Company Project), 4.05%, 7/01/31 | 6,085 | 6,085,000 | |||||||
4.05%, 7/01/31 | 3,800 | 3,800,000 | (BP Products Project), Series C, 4.05%, 7/01/34 | 4,900 | 4,900,000 | |||||||
4.05%, 7/01/32 | 2,600 | 2,600,000 | Whiting, Indiana, Industrial Sewer and Solid Waste | |||||||||
613,112,000 | Disposal Revenue Refunding Bonds (Amoco | |||||||||||
Oil Company Project), VRDN, AMT, 4.05%, | ||||||||||||
1/01/26 (a)(n) | 10,000 | 10,000,000 | ||||||||||
412,280,593 | ||||||||||||
See Notes to Financial Statements. CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 15 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||||
Par | Par | |||||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||||
Iowa — 0.4% | Kentucky (concluded) | |||||||||||||
Clear Lake, Iowa, Development Revenue Bonds | Louisville and Jefferson Counties, Kentucky, | |||||||||||||
(Joe Corbis Pizza Project), VRDN, AMT, | Metropolitan Sewer District, Sewer and Drain System, | |||||||||||||
8.11%, 4/01/31 (a)(n) | $ 3,460 | $ 3,460,000 | Revenue Refunding Bonds, VRDN, Series B, | |||||||||||
Iowa Finance Authority, Health Facilities Revenue | 8.05%, 5/15/23 (a)(c)(n) | $ 7,720 | $ 7,720,000 | |||||||||||
Bonds (Central Iowa Health System), VRDN, | Louisville and Jefferson Counties, Kentucky, Regional | |||||||||||||
Series A1, 7.95%, 2/15/35 (a)(f)(n) | 9,100 | 9,100,000 | Airport Authority, Special Facilities Revenue Bonds | |||||||||||
Iowa Finance Authority, Retirement Community | (UPS Worldwide Forwarding, Inc.), VRDN, AMT (a)(n): | |||||||||||||
Revenue Bonds (Edgewater — A Wesley Active | Series B, 4.75%, 1/01/29 | 5,900 | 5,900,000 | |||||||||||
Life Community), VRDN, Series E, 8.02%, | Series C, 5.15%, 1/01/29 | 7,200 | 7,200,000 | |||||||||||
11/01/42 (a)(n) | 10,000 | 10,000,000 | Municipal Securities Trust Certificates, Campbell and | |||||||||||
Iowa Finance Authority, Revenue Refunding Bonds | Kenton Counties, Kentucky, Sanitation District | |||||||||||||
(Trinity Health Credit Group), VRDN, Series D, | Number 1 Revenue Bonds, VRDN, Series SGA 130, | |||||||||||||
9%, 12/01/30 (a)(n) | 3,400 | 3,400,000 | 8.10%, 8/01/11 (a)(b)(c)(n) | 11,000 | 11,000,000 | |||||||||
Iowa Higher Education Loan Authority, Education | Public Energy Authority of Kentucky, Inc., Gas Supply | |||||||||||||
Facilities Revenue Bonds (Saint Ambrose | Revenue Bonds (BP Corporation of North America), | |||||||||||||
University), VRDN, 4.75%, 4/01/38 (a)(n) | 10,000 | 10,000,000 | VRDN, Series A, 4.25%, 8/01/16 (a)(n) | 21,172 | 21,172,000 | |||||||||
Louisa County, Iowa, PCR, Refunding (Iowa- | Shelby County, Kentucky, Lease Revenue Bonds, | |||||||||||||
Illinois Gas and Electric), VRDN, Series A, | VRDN, Series A, 4.25%, 9/01/34 (a)(n) | 3,085 | 3,085,000 | |||||||||||
8.35%, 9/01/16 (a)(n) | 10,000 | 10,000,000 | 181,241,306 | |||||||||||
45,960,000 | Louisiana — 2.4% | |||||||||||||
Kansas — 0.5% | Calcasieu Parish, Louisiana, IDB, Environmental | |||||||||||||
Kansas State Department of Transportation, Highway | Revenue Bonds (Citgo Petroleum Corp.), VRDN, | |||||||||||||
Revenue Bonds, ROCS, VRDN, Series II-R-6020, | AMT, 4.05%, 7/01/26 (a)(n) | 20,000 | 20,000,000 | |||||||||||
4.49%, 3/01/19 (a)(b)(c)(n) | 3,925 | 3,925,000 | Calcasieu Parish, Louisiana, IDB, Environmental | |||||||||||
Kansas State Department of Transportation, Highway | Revenue Refunding Bonds (Citgo Petroleum Corp.), | |||||||||||||
Revenue Refunding Bonds, VRDN (a)(n): | VRDN, AMT, 4.05%, 3/01/25 (a)(n) | 35,600 | 35,600,000 | |||||||||||
Series B-2, 8%, 9/01/19 | 11,400 | 11,400,000 | Eagle Tax-Exempt Trust, Louisiana State Gas and | |||||||||||
Series C-1, 8.20%, 9/01/19 | 19,700 | 19,700,000 | Fuels Tax Revenue Bonds, VRDN, Class A (a)(b)(c)(n): | |||||||||||
Kansas State Development Financing Authority, | Series 2006-0129, 8.49%, 5/01/41 | 27,225 | 27,225,000 | |||||||||||
M/F Housing Revenue Bonds (Delaware | Series 2006-137, 8.49%, 5/01/36 | 4,020 | 4,020,000 | |||||||||||
Highlands Assistant Living), VRDN, AMT, Series C, | Jefferson Parish, Louisiana, Hospital Service District | |||||||||||||
8.11%, 12/01/36 (a)(n) | 4,290 | 4,290,000 | Number 001, Hospital Revenue Bonds, PUTTERS, | |||||||||||
Kansas State Development Financing Authority, | VRDN, Series 522, 5.74%, 12/01/08 (a)(b)(n) | 10,000 | 10,000,000 | |||||||||||
Revenue Bonds (Sisters of Charity of | Lake Charles, Louisiana, Harbor and Terminal District | |||||||||||||
Leavenworth Health System), VRDN, Series C, | Revenue Bonds (Lake Charles Cogeneration | |||||||||||||
4.25%, 12/01/19 (a)(n) | 17,665 | 17,665,000 | Project), VRDN, 2.25%, 3/15/09 (a)(n) | 53,000 | 53,000,000 | |||||||||
56,980,000 | Louisiana Local Government Environmental Facilities | |||||||||||||
and Community Development Authority, Revenue | ||||||||||||||
Kentucky — 1.7% | Bonds, VRDN, AMT (a)(n): | |||||||||||||
Boyd County, Kentucky, Sewer and Solid Waste | (BASF Corporation Project), 8.75%, 12/01/36 | 4,000 | 4,000,000 | |||||||||||
Revenue Bonds (Air Products and Chemicals | (Honeywell International Inc. Project), | |||||||||||||
Project), VRDN, AMT, 8.55%, 7/01/21 (a)(n) | 3,775 | 3,775,000 | 8.16%, 12/01/37 | 6,000 | 6,000,000 | |||||||||
Carroll County, Kentucky, PCR, CP, 1.83%, 12/01/08 | 20,930 | 20,930,000 | Louisiana Local Government Environmental Facilities | |||||||||||
Eagle Tax-Exempt Trust, Louisville and Jefferson | and Community Development Authority, Revenue | |||||||||||||
Counties, Kentucky, Metropolitan Sewer | Refunding Bonds (BASF Corporation Project), | |||||||||||||
District, Sewer and Drain System Revenue | VRDN, Series B, 8.75%, 12/01/30 (a)(n) | 7,500 | 7,500,000 | |||||||||||
Bonds, VRDN, Series 2006-0053 Class A, | Louisiana Public Facilities Authority Revenue Bonds, | |||||||||||||
8.49%, 5/15/33 (a)(b)(c)(n) | 14,000 | 14,000,000 | VRDN (a)(n): | |||||||||||
Jefferson County, Kentucky, CP, 1.75%, 11/06/08 | 35,000 | 35,000,000 | (Air Products and Chemicals Project), AMT, | |||||||||||
Kentucky Asset/Liability Commission, General Fund | 8.55%, 12/01/39 | 2,850 | 2,850,000 | |||||||||||
Revenue Notes, TRAN, Series A, 3%, 6/25/09 | 18,100 | 18,259,306 | (Equipment and Capital Facilities Loan Program), | |||||||||||
Kentucky Higher Education Student Loan Corporation, | Series C, 8.21%, 7/01/24 | 1,150 | 1,150,000 | |||||||||||
Student Loan Revenue Refunding Bonds, VRDN, | (II City Plaza LLC Project), 8.21%, 3/01/40 | 7,280 | 7,280,000 | |||||||||||
AMT, Senior Series A-1, 7.75%, 6/01/37 (a)(n) | 15,700 | 15,700,000 | Louisiana State, GO, Refunding, VRDN, Series A, | |||||||||||
Louisville and Jefferson Counties, Kentucky, | 8%, 7/01/26 (a)(n) | 8,300 | 8,300,000 | |||||||||||
Metropolitan Government Health System, Revenue | Louisiana State Municipal Natural Gas Purchasing | |||||||||||||
Refunding Bonds, ROCS, VRDN, Series II-R-662CE, | and Distribution Authority Revenue Bonds, PUTTERS, | |||||||||||||
8.20%, 10/01/36 (a)(b)(n) | 17,500 | 17,500,000 | VRDN, Series 1411Q, 7.96%, 3/15/14 (a)(b)(n) | 12,787 | 12,787,000 |
See Notes to Financial Statements. 16 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||||
Par | Par | |||||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||||
Louisiana (concluded) | Maryland (concluded) | |||||||||||||
Louisiana State Offshore Terminal Authority, | Maryland State Stadium Authority, Lease Revenue | |||||||||||||
Deepwater Port Revenue Refunding Bonds | Refunding Bonds (Baltimore Convention Center), | |||||||||||||
(Loop LLC Project), VRDN, Series A, | VRDN, AMT, 8.05%, 12/15/14 (a)(n) | $ 3,595 $ | 3,595,000 | |||||||||||
4.30%, 9/01/14 (a)(n) | $ 21,950 | $ 21,950,000 | Montgomery County, Maryland, EDR (Riderwood | |||||||||||
Morgan Keegan Municipal Products, Inc., East Baton | Village Inc. Project), Refunding, VRDN, | |||||||||||||
Rouge, Louisiana, Mortgage Finance Authority, | 8%, 3/01/34 (a)(n) | 13,610 | 13,610,000 | |||||||||||
S/F Revenue Bonds, VRDN, AMT, Series A, | 154,625,000 | |||||||||||||
8.16%, 2/01/11 (a)(b)(n) | 8,135 | 8,135,000 | ||||||||||||
Morgan Keegan Municipal Products, Inc., New | Massachusetts — 3.4% | |||||||||||||
Orleans, Louisiana, Finance Authority, VRDN, | Bank of America MACON Trust, Massachusetts State | |||||||||||||
Series G, 8.16%, 12/01/41 (a)(b)(n) | 24,125 | 24,125,000 | Development Finance Agency Revenue Bonds, VRDN, | |||||||||||
Saint James Parish, Louisiana, Revenue | Series 2007-344, 8.07%, 12/01/12 (a)(b)(n) | 92,300 | 92,300,000 | |||||||||||
Bonds (NuStar Logistics, L Project), VRDN, | Bank of America MACON Trust, Massachusetts | |||||||||||||
7.90%, 6/01/38 (a)(n) | 4,000 | 4,000,000 | State Health and Educational Facilities Authority | |||||||||||
South Louisiana Port Commission, Port Revenue | Revenue Bonds, VRDN, Series 2007-310, | |||||||||||||
Refunding Bonds (Occidental Petroleum), VRDN, | 8%, 6/15/12 (a)(b)(n) | 7,880 | 7,880,000 | |||||||||||
8.25%, 7/01/18 (a)(n) | 4,400 | 4,400,000 | Beverly, Massachusetts, GO, BAN, 2.50%, 1/21/09 | 7,000 | 7,017,069 | |||||||||
Eagle Tax-Exempt Trust, Massachusetts State | ||||||||||||||
262,322,000 | Water Resource Authority, Revenue Refunding | |||||||||||||
Maine — 0.1% | Bonds, VRDN, Series 2006-0054 Class A, | |||||||||||||
Eclipse Funding Trust, Solar Eclipse Certificates, | 8.48%, 8/01/36 (a)(b)(c)(n) | 7,495 | 7,495,000 | |||||||||||
Maine Health and Higher Educational Facilities | Massachusetts Bay Transportation Authority, Sales | |||||||||||||
Authority Revenue Bonds, VRDN, Series 2007-0104, | Tax Revenue Refunding Bonds, VRDN, Senior | |||||||||||||
4.41%, 7/01/37 (a)(b)(g)(n) | 3,195 | 3,195,000 | Series A-2, 7.80%, 7/01/26 (a)(n) | 17,500 | 17,500,000 | |||||||||
School Administrative District Number 051, Maine, | Massachusetts State, CP: | |||||||||||||
GO, Refunding, BAN, 3.75%, 12/30/08 | 4,500 | 4,507,042 | 1.50%, 11/03/08 | 30,000 | 30,000,000 | |||||||||
7,702,042 | 1.62%, 11/05/08 | 18,000 | 18,000,000 | |||||||||||
1.70%, 12/04/08 | 10,500 | 10,500,000 | ||||||||||||
Maryland — 1.4% | Massachusetts State Development Finance Agency | |||||||||||||
Baltimore County, Maryland, EDR, Refunding | Revenue Bonds (Suffolk University), VRDN, | |||||||||||||
(Garrison Forest School Project), VRDN, | Series A, 8.50%, 7/01/35 (a)(f)(n) | 13,710 | 13,710,000 | |||||||||||
4.30%, 10/01/31 (a)(n) | 6,380 | 6,380,000 | Massachusetts State, GO, Refunding, VRDN, Series B, | |||||||||||
Baltimore County, Maryland, Revenue Refunding | 6.40%, 1/01/21 (a)(n) | 15,300 | 15,300,000 | |||||||||||
Bonds (The Paths at Loveton Farms Apartments | Massachusetts State Health and Educational | |||||||||||||
Facility Project), VRDN, 5.20%, 12/01/21 (a)(n) | 4,630 | 4,630,000 | Facilities Authority Revenue Bonds (Dana-Farber | |||||||||||
Baltimore, Maryland, Port Facilities Revenue | Cancer Institute), VRDN (a)(n): | |||||||||||||
Bonds (Occidental Petroleum), FLOATS, VRDN, | Series L-1, 7.75%, 12/01/47 | 6,800 | 6,800,000 | |||||||||||
2%, 10/14/11 (a)(b)(n) | 35,700 | 35,700,000 | Series L-2, 7.75%, 12/01/47 | 7,800 | 7,800,000 | |||||||||
Maryland State Community Development | Massachusetts State Health and Educational | |||||||||||||
Administration, Department of Housing and | Facilities Authority, Revenue Refunding Bonds, | |||||||||||||
Community Development, Residential Revenue | VRDN (a)(n): | |||||||||||||
Bonds, VRDN, AMT, Series C, 8.01%, 9/01/35 (a)(n) | 13,630 | 13,630,000 | (Harvard University), Series R, 3.75%, 11/01/49 | 3,000 | 3,000,000 | |||||||||
Maryland State Economic Development | (Partners Healthcare System Project), Series F-4, | |||||||||||||
Corporation Revenue Bonds (Pharmaceutics | 7.84%, 7/01/40 | 62,625 | 62,625,000 | |||||||||||
International, Inc. Project), VRDN, AMT, | Massachusetts State Water Resource Authority, | |||||||||||||
Series A, 8.11%, 5/03/21 (a)(n) | 4,715 | 4,715,000 | Revenue Refunding Bonds, VRDN, Series B, | |||||||||||
Maryland State Economic Development Corporation, | 7.75%, 8/01/31 (n) | 20,000 | 20,000,000 | |||||||||||
Revenue Refunding Bonds (Garrett Community | Municipal Securities Trust Certificates, Massachusetts | |||||||||||||
College), VRDN, 7.96%, 8/01/38 (a)(n) | 7,005 | 7,005,000 | State Turnpike Authority, Metropolitan Highway | |||||||||||
Maryland State, GO, ROCS, VRDN, Series II-R-11573, | System, Revenue Refunding Bonds, VRDN, Series | |||||||||||||
4.20%, 7/15/21 (a)(b)(n) | 3,500 | 3,500,000 | SGC 28, Class A, 4.93%, 1/01/29 (a)(b)(n) | 6,665 | 6,665,000 | |||||||||
Maryland State Health and Higher Educational | University of Massachusetts Building Authority | |||||||||||||
Facilities Authority, Revenue Refunding Bonds, | Revenue Bonds, VRDN, Senior Series A, | |||||||||||||
VRDN (a)(n): | 7.75%, 5/01/38 (a)(h)(n) | 16,080 | 16,080,000 | |||||||||||
(Johns Hopkins University), Series B, | University of Massachusetts Building Authority, | |||||||||||||
7.75%, 7/01/27 | 14,765 | 14,765,000 | Revenue Refunding Bonds, VRDN (a)(n): | |||||||||||
(Pooled Loan Program), Series D, | Senior Series 3, 7.90%, 11/01/34 | 20,000 | 20,000,000 | |||||||||||
7.20%, 1/01/29 | 39,895 | 39,895,000 | Senior Series 4, 7.92%, 11/01/34 | 15,000 | 15,000,000 | |||||||||
(University of Maryland Medical System), | ||||||||||||||
Series B, 7.50%, 7/01/41 | 7,200 | 7,200,000 | 377,672,069 | |||||||||||
See Notes to Financial Statements. CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 17 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||
Par | Par | |||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||
Michigan — 6.1% | Michigan (concluded) | |||||||||||
Bank of America MACON Trust, Detroit, Michigan, City | Oakland University, Michigan, Revenue Refunding | |||||||||||
School District, GO, Refunding, VRDN, Series J, | Bonds, VRDN, 7.75%, 3/01/31 (a)(n) | $ 8,000 | $ 8,000,000 | |||||||||
3.94%, 5/01/28 (a)(b)(c)(n) | $ 5,100 | $ 5,100,000 | RBC Municipal Products, Inc., Michigan Higher | |||||||||
Detroit, Michigan, City School District, GO, VRDN, | Education Student Loan Authority, Revenue | |||||||||||
Series A, 5.65%, 5/01/29 (a)(c)(n) | 4,615 | 4,615,000 | Refunding Bonds, FLOATS, VRDN, AMT, Series L-24, | |||||||||
Detroit, Michigan, Sewage Disposal Revenue | 3.10%, 3/01/28 (a)(b)(n) | 44,945 | 44,945,000 | |||||||||
Refunding Bonds, VRDN (a)(n): | University of Michigan, University Hospital Revenue | |||||||||||
ROCS, Series II-R-9221, 4.61%, 7/01/36 (b)(e) | 13,840 | 13,840,000 | Bonds, VRDN, Series A, 8%, 12/01/27 (a)(n) | 61,000 | 61,000,000 | |||||||
Senior Lien, Series C-1, 8.25%, 7/01/27 (c) | 19,700 | 19,700,000 | University of Michigan, University Hospital | |||||||||
Detroit, Michigan, Water Supply System, Revenue | Revenue Refunding Bonds, VRDN, Series B, | |||||||||||
Refunding Bonds, ROCS, VRDN, Series II-R-665PB, | 7.75%, 12/01/37 (a)(n) | 12,000 | 12,000,000 | |||||||||
4.31%, 7/01/33 (a)(b)(e)(n) | 20,805 | 20,805,000 | 665,452,222 | |||||||||
Deutsche Bank SPEARs/LIFERs Trust, Wayne County, | ||||||||||||
Michigan, Airport Authority, Revenue Refunding | Minnesota — 1.3% | |||||||||||
Bonds, SPEARs, VRDN, AMT, Series DB-652, | Minnesota Agriculture and Economic | |||||||||||
4.11%, 12/01/32 (a)(b)(f)(n) | 12,940 | 12,940,000 | Development Board, Revenue Refunding | |||||||||
Eagle Tax-Exempt Trust, Michigan State Building | Bonds (Essentia Health), VRDN, Series C-4B, | |||||||||||
Authority, Revenue Refunding Bonds, VRDN, Series | 4.90%, 2/15/20 (a)(f)(n) | 5,250 | 5,250,000 | |||||||||
2006-156, Class A, 8.72%, 10/15/36 (a)(b)(c)(n) | 7,100 | 7,100,000 | Minnesota State, GO, ROCS, VRDN (a)(b)(n): | |||||||||
Eastern Michigan University, Revenue Refunding | Series II-R-4065, 4.38%, 8/01/23 | 1,665 | 1,665,000 | |||||||||
Bonds, VRDN, 8.25%, 6/01/36 (a)(n) | 13,000 | 13,000,000 | Series II-R-6101, 4.32%, 8/01/24 | 2,300 | 2,300,000 | |||||||
Grand Rapids, Michigan, Sanitation Sewer System | Minnesota State, HFA, Residential Housing Finance | |||||||||||
Revenue Bonds, ROCS, VRDN, Series II-R-12147, | Revenue Refunding Bonds, VRDN, AMT, Series C, | |||||||||||
8.73%, 1/01/17 (a)(b)(c)(n) | 6,900 | 6,900,000 | 8.15%, 7/01/48 (a)(n) | 7,500 | 7,500,000 | |||||||
Kent Hospital Finance Authority, Michigan, Revenue | Rochester, Minnesota, Healthcare Facilities, CP: | |||||||||||
Refunding Bonds (Spectrum Health), VRDN, | 1.75%, 12/10/08 | 66,500 | 66,500,000 | |||||||||
Series B-2, 7.91%, 1/15/47 (a)(n) | 37,000 | 37,000,000 | 1.70%, 12/11/08 | 41,750 | 41,750,000 | |||||||
Michigan Municipal Bond Authority Revenue Notes, | Saint Cloud, Minnesota, Health Care Revenue | |||||||||||
Series A-1, 3%, 8/20/09 | 28,600 | 28,942,222 | Bonds (CentraCare Health System Project), VRDN, | |||||||||
Michigan State, HDA, Rental Housing Revenue | Series A, 7.98%, 5/01/42 (a)(f)(n) | 7,780 | 7,780,000 | |||||||||
Refunding Bonds, VRDN, AMT, Series A, | University of Minnesota Revenue Bonds, VRDN (a)(n): | |||||||||||
4.75%, 10/01/37 (a)(n) | 39,000 | 39,000,000 | Series A, 7.75%, 1/01/34 | 3,820 | 3,820,000 | |||||||
Michigan State, HDA, Revenue Refunding Bonds, | Series C, 7.75%, 12/01/36 | 4,935 | 4,935,000 | |||||||||
VRDN, AMT, Series B, 7.75%, 6/01/38 (a)(n) | 100,200 | 100,200,000 | 141,500,000 | |||||||||
Michigan State Hospital Finance Authority Revenue | Mississippi — 1.1% | |||||||||||
Bonds (Ascension Health), VRDN, Series B-1, | Mississippi Business Finance Corporation, Gulf | |||||||||||
7.75%, 11/15/33 (a)(n) | 81,890 | 81,890,000 | Opportunity Zone, IDR (SG Resources | |||||||||
Michigan State Hospital Finance Authority, Revenue | Mississippi LLC), VRDN, 7.90%, 5/01/32 (a)(n) | 15,000 | 15,000,000 | |||||||||
Refunding Bonds, VRDN (a)(n): | Mississippi Business Finance Corporation Revenue | |||||||||||
(Ascension Health), 7.75%, 11/15/33 | 39,700 | 39,700,000 | Bonds (Renaissance at Colony Park LLC Project), | |||||||||
(McLaren Health Care), Series B, | VRDN, 8.01%, 5/01/35 (a)(n) | 12,870 | 12,870,000 | |||||||||
7.90%, 10/15/30 | 4,800 | 4,800,000 | Mississippi Development Bank, Special Obligation | |||||||||
(McLaren Health Care), Series B, | Revenue Bonds (Municipal Gas Authority of | |||||||||||
7.90%, 10/15/38 | 12,300 | 12,300,000 | Mississippi — Natural Gas Supply Project), VRDN, | |||||||||
Michigan State Revenue Bonds, PUTTERS, VRDN, | 7.25%, 7/01/15 (a)(n) | 50,522 | 50,522,000 | |||||||||
Series 2096, 4.59%, 9/15/17 (a)(b)(c)(n) | 9,970 | 9,970,000 | Mississippi Development Bank, Special Obligation | |||||||||
Michigan State University, General Revenue Bonds, | Revenue Refunding Bonds (Walnut Grove | |||||||||||
VRDN (a)(n): | Youth Facility Project), VRDN, Series A, | |||||||||||
7.82%, 2/15/34 | 38,740 | 38,740,000 | 7.25%, 8/01/27 (a)(n) | 8,000 | 8,000,000 | |||||||
FLOATS, Series A2, 8.70%, 8/15/22 (b) | 25,400 | 25,400,000 | Mississippi Hospital Equipment and Facilities | |||||||||
Michigan State University, General Revenue Refunding | Authority, Revenue Refunding Bonds (North | |||||||||||
Bonds, VRDN, Series A, 7.82%, 2/15/33 (a)(n) | 7,315 | 7,315,000 | Mississippi Health Services), VRDN, Series 1, | |||||||||
Oakland County, Michigan, Economic Development | 7.95%, 5/15/16 (a)(n) | 4,524 | 4,524,000 | |||||||||
Corporation, Limited Obligation Revenue Bonds, | Mississippi State, Capital Improvement, GO, VRDN, | |||||||||||
VRDN (a)(n): | 8%, 9/01/25 (a)(n) | 30,200 | 30,200,000 | |||||||||
(Exhibit Enterprises, Inc. Project), AMT, | ||||||||||||
8.11%, 6/01/34 | 6,250 | 6,250,000 | 121,116,000 | |||||||||
(Marian High School Inc. Project), | ||||||||||||
8.21%, 5/01/37 | 4,000 | 4,000,000 |
See Notes to Financial Statements. 18 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||
Par | Par | |||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||
Missouri — 0.6% | Nevada (concluded) | |||||||||||
Missouri-Illinois Bi-State Development Agency, | Clark County, Nevada, School District, GO, | |||||||||||
Subordinate Mass Transit Revenue Bonds | PUTTERS, VRDN, Series 1429, 5.25%, | |||||||||||
(Metrolink Cross County Extension Project), VRDN, | 12/15/13 (a)(b)(c)(n) | $ 4,365 | $4,365,000 | |||||||||
Series A, 7.50%, 10/01/35 (a)(n) | $ 3,160 | $ 3,160,000 | Truckee Meadows, Nevada, Water Authority, Water | |||||||||
Missouri Joint Municipal Electric Utility Commission, | Revenue Refunding Bonds, FLOATS, VRDN, | |||||||||||
Power Project Revenue Bonds, ROCS, VRDN, | Series 51TP, 4.28%, 7/01/30 (a)(b)(c)(n) | 5,895 | 5,895,000 | |||||||||
Series II-R-620PB, 4.32%, 1/01/34 (a)(b)(e)(n) | 5,730 | 5,730,000 | 53,744,048 | |||||||||
Missouri State Health and Educational Facilities | ||||||||||||
Authority, Health Facilities Revenue Refunding | New Hampshire — 0.2% | |||||||||||
Bonds, VRDN (a)(n): | Eclipse Funding Trust, Solar Eclipse Certificates, | |||||||||||
(Saint Luke’s Health System), Series A, | New Hampshire Health and Educational | |||||||||||
8%, 11/15/40 | 8,325 | 8,325,000 | Facilities Authority Revenue Bonds, VRDN, | |||||||||
(Sisters of Mercy Health System), Series A, | Series 2007-0018, 4.05%, 7/01/36 (a)(b)(n) | 10,495 | 10,495,000 | |||||||||
4.25%, 6/01/16 | 7,300 | 7,300,000 | New Hampshire Health and Education Facilities | |||||||||
(Sisters of Mercy Health System), Series B, | Authority Revenue Bonds (River College), VRDN, | |||||||||||
4.25%, 6/01/16 | 6,300 | 6,300,000 | 8.32%, 2/01/38 (a)(n) | 6,870 | 6,870,000 | |||||||
(Sisters of Mercy Health System), Series C, | 17,365,000 | |||||||||||
7.93%, 6/01/19 | 8,925 | 8,925,000 | New Jersey — 0.0% | |||||||||
(Sisters of Mercy Health System), Series D-3, | Deutsche Bank SPEARs/LIFERs Trust, New Jersey | |||||||||||
8.05%, 6/01/33 (c) | 6,025 | 6,025,000 | State Transportation Trust Fund Revenue | |||||||||
Missouri State Highways and Transportation | Bonds, SPEARs, VRDN, AMT, Series DB-452, | |||||||||||
Commission, State Road Revenue Bonds, ROCS, | 4.19%, 12/15/33 (a)(b)(c)(n) | 2,595 | 2,595,000 | |||||||||
VRDN, Series II-R-8102, 4.42%, 5/01/23 (a)(b)(n) | 4,000 | 4,000,000 | ||||||||||
Palmyra, Missouri, IDA, Solid Waste Disposal | New Mexico — 0.3% | |||||||||||
Revenue Bonds (BASF Corporation Project), VRDN, | Eclipse Funding Trust, Solar Eclipse Certificates, | |||||||||||
AMT, 8.75%, 12/01/22 (a)(n) | 6,000 | 6,000,000 | Rio Rancho, New Mexico, Water and Waste | |||||||||
Saint Louis, Missouri, General Fund, TRAN, | Water Revenue Bonds, VRDN, Series | |||||||||||
3.25%, 6/30/09 | 5,300 | 5,357,637 | 2006-0019, 4.25%, 5/15/32 (a)(b)(d)(n) | 14,505 | 14,505,000 | |||||||
New Mexico Mortgage Finance Authority, | ||||||||||||
61,122,637 | S/F Mortgage Revenue Bonds, VRDN, AMT, | |||||||||||
Multi-State — 0.0% | 2.49%, 10/01/08 (a)(n) | 17,903 | 17,903,075 | |||||||||
Clipper Tax-Exempt Certificates Trust, Multi-State | New Mexico State Hospital Equipment Loan | |||||||||||
Revenue Bonds, VRDN, AMT, Series 2007-19, | Council, Hospital Revenue Refunding Bonds | |||||||||||
8.11%, 6/01/11 (a)(b)(i)(n) | 3,227 | 3,227,000 | (Presbyterian Healthcare Services), VRDN, | |||||||||
Nebraska — 1.3% | Series A, 8.15%, 8/01/30 (a)(c)(n) | 4,480 | 4,480,000 | |||||||||
American Public Energy Agency, Nebraska, Gas | 36,888,075 | |||||||||||
Supply Revenue Bonds, VRDN (a)(n): | New York — 4.8% | |||||||||||
(National Public Gas Agency Project), Series B, | Albany, New York, City School District, GO, BAN, | |||||||||||
6.50%, 2/01/14 | 83,635 | 83,635,000 | Series A, 3%, 6/26/09 | 32,665 | 32,951,056 | |||||||
Series A, 7.25%, 12/01/15 | 31,258 | 31,258,000 | Babylon, New York, IDA Residential Recovery | |||||||||
Eagle Tax-Exempt Trust, Omaha Public Power | Revenue Refunding Bonds (Ogden Martin | |||||||||||
District, Nebraska, Separate Electric Revenue | Project), VRDN, 8.30%, 1/01/19 (a)(c)(n) | 7,000 | 7,000,000 | |||||||||
Bonds, VRDN, Series 2005-3008, Class A, | New York City, New York, City Housing | |||||||||||
8.19%, 2/01/46 (a)(b)(n) | 12,760 | 12,760,000 | Development Corporation, M/F Mortgage | |||||||||
Eagle Tax-Exempt Trust, Public Power Generation | Revenue Bonds (Beekman Tower), VRDN, | |||||||||||
Agency, Nebraska, Revenue Bonds, VRDN, Series A, | Series A, 7.90%, 3/01/48 (a)(n) | 24,300 | 24,300,000 | |||||||||
8.19%, 1/01/41 (a)(b)(n) | 11,000 | 11,000,000 | New York City, New York, City Housing | |||||||||
Eclipse Funding Trust, Solar Eclipse Certificates, | Development Corporation, M/F Mortgage | |||||||||||
Omaha, Nebraska, Public Power District | Revenue Refunding Bonds (The Crest Project), | |||||||||||
Revenue Bonds, VRDN, Series 2006-0025, | VRDN, Series A, 8%, 12/01/36 (a)(n) | 2,700 | 2,700,000 | |||||||||
4.18%, 2/01/36 (a)(b)(n) | 5,870 | 5,870,000 | New York City, New York, City Housing | |||||||||
144,523,000 | Development Corporation, M/F Rental Housing | |||||||||||
Nevada — 0.5% | Revenue Bonds (Brittany Development), VRDN, | |||||||||||
Clark County, Nevada, Airport System Revenue Bonds, | AMT, Series A, 8.15%, 6/15/29 (a)(j)(n) | 13,000 | 13,000,000 | |||||||||
VRDN, AMT, 3%, 7/01/09 (a)(n) | 36,600 | 36,884,048 | New York City, New York, City IDA, Liberty Revenue | |||||||||
Clark County, Nevada, Airport System Revenue | Bonds (One Bryant Park LLC Project), VRDN, | |||||||||||
Refunding Bonds, Sub-Lien, VRDN, Series D-1, | Series A, 7.50%, 11/01/39 (a)(n) | 24,000 | 24,000,000 | |||||||||
7.93%, 7/01/36 (a)(n) | 6,600 | 6,600,000 | New York City, New York, City Municipal Water | |||||||||
Finance Authority, CP: | ||||||||||||
1.65%, 11/05/08 | 7,050 | 7,050,000 | ||||||||||
1.65%, 11/14/08 | 50,000 | 50,000,000 | ||||||||||
1.75%, 11/14/08 | 25,000 | 25,000,000 |
See Notes to Financial Statements. CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 19 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||
Par | Par | |||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||
New York (concluded) | North Carolina (continued) | |||||||||||
New York City, New York, City Transitional Finance | Cleveland County, North Carolina, Industrial Facilities | |||||||||||
Authority, Future Tax Secured Revenue Bonds, | and Pollution Control Financing Authority, Industrial | |||||||||||
VRDN, Series A-1, 7.75%, 11/15/28 (a)(n) | $ 15,780 | $ 15,780,000 | Revenue Bonds (Chris Craft Corporation Project), | |||||||||
New York City, New York, City Transitional Finance | VRDN, AMT, 8.08%, 5/01/32 (a)(n) | $ 5,200 | $5,200,000 | |||||||||
Authority Revenue Bonds (New York City | Eagle Tax-Exempt Trust, North Carolina Capital | |||||||||||
Recovery), VRDN, Series 3, Sub-Series 3-G, | Facilities Finance Agency, Revenue Refunding | |||||||||||
8%, 11/01/22 (a)(n) | 18,465 | 18,465,000 | Bonds, VRDN, Series 2007-0015, Class A, | |||||||||
New York City, New York, City Transitional Finance | 8.23%, 7/01/42 (a)(b)(n) | 10,890 | 10,890,000 | |||||||||
Authority Revenue Refunding Bonds, VRDN (a)(n): | Lee County, North Carolina, Industrial Facilities | |||||||||||
(New York City Recovery), Series 3, | and Pollution Control Financing Authority, IDR | |||||||||||
Sub-Series 3-B, 4.15%, 11/01/22 | 52,125 | 52,125,000 | (Arden Corporation Project), VRDN, AMT, | |||||||||
Sub-Series C-3, 7.75%, 8/01/31 | 13,545 | 13,545,000 | 8.11%, 8/01/34 (a)(n) | 4,800 | 4,800,000 | |||||||
New York City, New York, City Transitional Finance | Martin County, North Carolina, Industrial Facilities | |||||||||||
Authority, Special Tax Revenue Refunding Bonds, | and Pollution Control Financing Authority, | |||||||||||
VRDN, Series C, 8%, 2/01/32 (a)(n) | 8,100 | 8,100,000 | IDR (Penco Products Project), VRDN, AMT, | |||||||||
New York City, New York, GO, ROCS, VRDN, | 8.11%, 9/01/22 (a)(n) | 9,000 | 9,000,000 | |||||||||
Series II-R-251A, 5.43%, 12/15/33 (a)(b)(n) | 25,000 | 25,000,000 | Mecklenburg County, North Carolina, COP, VRDN (a)(n): | |||||||||
New York City, New York, GO, Refunding, VRDN (a)(n): | 7.48%, 2/01/25 | 31,150 | 31,150,000 | |||||||||
Sub-Series E-3, 4.25%, 8/01/23 | 19,300 | 19,300,000 | 7.48%, 2/01/26 | 44,415 | 44,415,000 | |||||||
Sub-Series J-8, 4%, 8/01/21 | 1,600 | 1,600,000 | Series A, 7.48%, 2/01/26 | 28,565 | 28,565,000 | |||||||
Sub-Series J-9, 7.76%, 8/01/27 | 25,000 | 25,000,000 | Series A, 5%, 2/01/27 | 25,060 | 25,060,000 | |||||||
New York City, New York, GO, VRDN (a)(n): | Series A, 8%, 2/01/28 | 9,000 | 9,000,000 | |||||||||
Series F-4, 7.86%, 2/15/20 | 16,840 | 16,840,000 | Montgomery County, North Carolina, Industrial | |||||||||
Sub-Series H-1, 4.25%, 1/01/36 | 5,000 | 5,000,000 | Facilities and Pollution Control Financing Authority | |||||||||
Sub-Series H-3, 8%, 3/01/34 | 3,800 | 3,800,000 | Revenue Bonds (Republic Services Project), VRDN, | |||||||||
Sub-Series I-4, 8.25%, 4/01/36 | 10,550 | 10,550,000 | AMT, 4.40%, 12/01/20 (a)(n) | 2,900 | 2,900,000 | |||||||
New York State Dormitory Authority, Mental Health | North Carolina Capital Facilities Finance Agency, | |||||||||||
Services Revenue Bonds, VRDN, Sub-Series D-2F, | Exempt Facilities Revenue Bonds (Republic Services | |||||||||||
7.80%, 2/15/31 (a)(n) | 9,120 | 9,120,000 | Inc. Project), VRDN, AMT, 8.05%, 9/01/25 (a)(n) | 10,000 | 10,000,000 | |||||||
New York State Dormitory Authority, Non-State | North Carolina Capital Facilities Finance Agency | |||||||||||
Supported Debt Revenue Bonds (Rochester | Revenue Bonds (Aquarium Society Project), VRDN, | |||||||||||
Friendly Home), VRDN, 7.95%, 6/01/38 (a)(n) | 8,545 | 8,545,000 | 7.25%, 6/01/26 (a)(n) | 3,400 | 3,400,000 | |||||||
New York State, HFA, Housing Revenue Bonds | North Carolina Capital Facilities Finance Agency, Solid | |||||||||||
(363 West 30th Street), VRDN, AMT, Series A, | Waste Disposal, Revenue Refunding Bonds (Duke | |||||||||||
8.20%, 11/01/32 (a)(k)(n) | 2,800 | 2,800,000 | Energy Carolinas LLC), VRDN, AMT (a)(n): | |||||||||
New York State, HFA, Revenue Bonds, VRDN, AMT, | Series A, 8%, 11/01/40 | 9,000 | 9,000,000 | |||||||||
Series A (a)(n): | Series B, 7.90%, 11/01/40 | 6,000 | 6,000,000 | |||||||||
(42nd & 10th Project), 7.65%, 11/01/41 | 29,500 | 29,500,000 | North Carolina Eastern Municipal Power Agency, | |||||||||
(Worth Street Project), 8.15%, 5/15/33 (j) | 11,800 | 11,800,000 | Power System Revenue Bonds, MERLOTS, VRDN, | |||||||||
New York State, HFA, Service Contract Revenue | Series A22, 4.84%, 1/01/24 (a)(b)(n) | 4,025 | 4,025,000 | |||||||||
Refunding Bonds, VRDN, Series G, | North Carolina Educational Facilities Finance | |||||||||||
7.82%, 3/15/28 (a)(n) | 11,000 | 11,000,000 | Agency Revenue Bonds (Duke University | |||||||||
New York State Mortgage Agency, Homeowner | Project), VRDN (a)(n): | |||||||||||
Mortgage Revenue Bonds, VRDN, AMT (a)(n): | Series A, 7.90%, 12/01/17 | 8,250 | 8,250,000 | |||||||||
37th Series, 8.30%, 4/01/35 | 15,200 | 15,200,000 | Series A, 7.90%, 6/01/27 | 13,700 | 13,700,000 | |||||||
Series 139, 5%, 10/01/37 | 4,750 | 4,750,000 | Series B, 7.75%, 12/01/21 | 11,100 | 11,100,000 | |||||||
New York State Urban Development Corporation, | North Carolina HFA, Home Ownership Revenue Bonds, | |||||||||||
Service Contract Revenue Refunding Bonds, VRDN, | VRDN, AMT (a)(n): | |||||||||||
Series A-5, 7.85%, 1/01/30 (a)(n) | 11,800 | 11,800,000 | MERLOTS, Series B12, 4.77%, 7/01/37 (b) | 3,085 | 3,085,000 | |||||||
Triborough Bridge and Tunnel Authority, New York, | Series 18-C, 7.75%, 1/01/35 | 3,000 | 3,000,000 | |||||||||
General Purpose Revenue Bonds, VRDN, Series B, | North Carolina Medical Care Commission, Health | |||||||||||
7.83%, 1/01/33 (a)(n) | 18,145 | 18,145,000 | Care Facilities Revenue Bonds, VRDN (a)(n): | |||||||||
523,766,056 | (Novant Health Group), Series B, | |||||||||||
7.50%, 11/01/34 | 8,300 | 8,300,000 | ||||||||||
North Carolina — 5.6% | (Novant Health Inc.), Series A, 7.91%, 11/01/34 | 59,750 | 59,750,000 | |||||||||
Charlotte, North Carolina, Water and Sewer | North Carolina Medical Care Commission, Health Care | |||||||||||
System Revenue Bonds, VRDN, Series B, | Facilities, Revenue Refunding Bonds, VRDN (a)(n): | |||||||||||
7.48%, 7/01/36 (a)(n) | 99,890 | 99,890,000 | (Duke University Health System), Series C, | |||||||||
7.91%, 6/01/28 | 11,500 | 11,500,000 | ||||||||||
ROCS, Series II-R-10313, 5.32%, 6/01/11 (b) | 6,200 | 6,200,000 |
See Notes to Financial Statements. 20 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||||
Par | Par | |||||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||||
North Carolina (concluded) | Ohio (concluded) | |||||||||||||
North Carolina Medical Care Commission, Hospital | Hamilton County, Ohio, Student Housing | |||||||||||||
Revenue Bonds, VRDN (a)(n): | Revenue Bonds (Block 3 Community Urban | |||||||||||||
(Duke University Hospital Project), Series B, | Redevelopment Corporation Project), VRDN, | |||||||||||||
7.35%, 6/01/15 | $ 2,250 | $ 2,250,000 | 8.30%, 8/01/36 (a)(n) | $ 8,830 | $ 8,830,000 | |||||||||
(Moses H. Cone Memorial Health System), | Lancaster Port Authority, Ohio, Gas Revenue Bonds, | |||||||||||||
Series A, 6.50%, 10/01/35 | 39,450 | 39,450,000 | VRDN, 8%, 5/01/38 (a)(n) | 17,000 | 17,000,000 | |||||||||
(Moses H. Cone Memorial Health System), | Mercer County, Ohio, Detention Facility, GO, BAN, | |||||||||||||
Series B, 6.50%, 10/01/35 | 28,300 | 28,300,000 | 2.75%, 3/10/09 | 1,500 | 1,503,231 | |||||||||
North Carolina Medical Care Commission, Hospital | Municipal Securities Trust Certificates, Princeton, | |||||||||||||
Revenue Refunding Bonds (Duke University | Ohio, City School District, GO, VRDN, | |||||||||||||
Hospital Project), VRDN, 7.35%, 6/01/23 (a)(n) | 22,850 | 22,850,000 | Series SGB 50-A, 4%, 12/01/30 (a)(b)(d)(n) | 2,370 | 2,370,000 | |||||||||
North Carolina Medical Care Commission, Retirement | Ohio State Air Quality Development Authority, | |||||||||||||
Facilities Revenue Refunding Bonds (Aldersgate | Revenue Refunding Bonds, VRDN (a)(n): | |||||||||||||
Project), VRDN, 8.05%, 1/01/31 (a)(n) | 500 | 500,000 | (Cincinnati Gas and Electric), Series A, | |||||||||||
North Carolina State, GO, VRDN, Series F, | 8%, 9/01/30 | 7,900 | 7,900,000 | |||||||||||
7.75%, 5/01/21 (a)(n) | 7,200 | 7,200,000 | (Cincinnati Gas and Electric), Series B, | |||||||||||
Raleigh, North Carolina, COP (Downtown | 8.70%, 9/01/30 | 16,300 | 16,300,000 | |||||||||||
Improvement Projects), VRDN, Series B, | (FirstEnergy Nuclear Generation Corporation | |||||||||||||
7.91%, 2/01/34 (a)(n) | 19,000 | 19,000,000 | Project), AMT, Series A, 8.07%, 6/01/33 | 12,400 | 12,400,000 | |||||||||
Raleigh, North Carolina, Combined Enterprise System | Ohio State, GO, Common Schools, VRDN (a)(n): | |||||||||||||
Revenue Bonds, ROCS, VRDN, Series II-R-645, | Series A, 7.80%, 3/15/25 | 21,785 | 21,785,000 | |||||||||||
6.07%, 3/01/36 (a)(b)(n) | 6,400 | 6,400,000 | Series B, 7.80%, 3/15/25 | 31,115 | 31,115,000 | |||||||||
Union County, North Carolina, GO, Refunding, VRDN, | Ohio State, GO, Refunding, VRDN, Series D, | |||||||||||||
Series A, 7.47%, 3/01/29 (a)(n) | 2,335 | 2,335,000 | 8%, 2/01/19 (a)(n) | 10,200 | 10,200,000 | |||||||||
University of North Carolina at Chapel Hill, Hospital | Ohio State University, General Receipts Revenue | |||||||||||||
Revenue Refunding Bonds, VRDN, Series B, | Bonds, VRDN, Series B, 7.75%, 6/01/35 (a)(n) | 900 | 900,000 | |||||||||||
4.25%, 2/15/31 (a)(n) | 3,900 | 3,900,000 | Ohio State Water Development Authority, Pollution | |||||||||||
University of North Carolina, University | Control Facilities, Revenue Refunding Bonds | |||||||||||||
Revenue Refunding Bonds, VRDN, Series B, | (FirstEnergy Nuclear Generation Corporation Project), | |||||||||||||
7.70%, 12/01/25 (a)(n) | 4,100 | 4,100,000 | VRDN, AMT, Series A, 6.50%, 8/01/33 (a)(n) | 30,000 | 30,000,000 | |||||||||
Wake County, North Carolina, GO, VRDN, Series A, | Ohio State Water Development Authority, Revenue | |||||||||||||
7.90%, 4/01/19 (a)(n) | 45,250 | 45,250,000 | Refunding Bonds, BAN, 2%, 11/06/08 | 3,810 | 3,810,881 | |||||||||
Wake County, North Carolina, Industrial Facilities | Strongsville, Ohio, GO, BAN, 2.60%, 12/11/08 | 1,725 | 1,726,161 | |||||||||||
and Pollution Control Financing Authority Revenue | 212,932,643 | |||||||||||||
Bonds (Solid Waste Disposal-Highway 55), VRDN, | ||||||||||||||
AMT, 7.65%, 9/01/13 (a)(n) | 2,700 | 2,700,000 | Oklahoma — 0.1% | |||||||||||
Oklahoma State Development Finance Authority | ||||||||||||||
612,415,000 | Revenue Bonds (ConocoPhillips Company Project), | |||||||||||||
North Dakota — 0.1% | VRDN, AMT (a)(n): | |||||||||||||
Cass County, North Dakota, Health Facilities Revenue | 8.25%, 12/01/38 | 5,000 | 5,000,000 | |||||||||||
Bonds (Essentia Health — Saint Mary’s Duluth | Series B, 8.25%, 8/01/37 | 2,500 | 2,500,000 | |||||||||||
Clinic), VRDN, Series A-1, 8%, 2/15/37 (a)(f)(n) | 10,185 | 10,185,000 | Oklahoma State, HFA, S/F Mortgage Revenue | |||||||||||
Ohio — 1.9% | Refunding Bonds, VRDN, 2.49%, 3/01/09 (a)(n) | 5,990 | 5,990,200 | |||||||||||
Allen County, Ohio, Hospital Facilities Revenue Bonds | 13,490,200 | |||||||||||||
(Catholic Healthcare Partners), VRDN, Series A, | Oregon �� 0.7% | |||||||||||||
4.20%, 10/01/31 (a)(n) | 5,000 | 5,000,000 | ABN AMRO MuniTops Certificates Trust, | |||||||||||
Canfield, Ohio, Local School District, GO, BAN, | Portland, Oregon, GO, VRDN, Series 2001-4, | |||||||||||||
2.50%, 9/17/09 | 4,730 | 4,757,719 | 5.15%, 6/01/09 (a)(b)(d)(n) | 11,730 | 11,730,000 | |||||||||
Clark County, Ohio, GO, BAN, 2%, 5/06/09 | 1,275 | 1,276,492 | Clackamas County, Oregon, Hospital Facility Authority | |||||||||||
Clinton County, Ohio, Sanitation and Sewer, GO, BAN, | Revenue Bonds (Legacy Health System), VRDN, | |||||||||||||
2.50%, 10/23/08 | 2,475 | 2,476,002 | 7.92%, 2/15/30 (a)(n) | 8,875 | 8,875,000 | |||||||||
Dayton-Montgomery County Port Authority, Ohio, | Klamath Falls, Oregon, Electric Revenue Refunding | |||||||||||||
Special Airport Facilities Revenue Bonds | Bonds (Klamath Cogeneration Project), Senior Lien, | |||||||||||||
(Wilmington Air Park LLC), VRDN, AMT (a)(n): | VRDN, 6%, 1/01/09 (a)(l)(n) | 30,000 | 30,810,696 | |||||||||||
Series B, 8.35%, 2/01/37 | 11,000 | 11,000,000 | Medford, Oregon, Hospital Facilities Authority | |||||||||||
Series C, 8.35%, 2/01/37 | 8,000 | 8,000,000 | Revenue Bonds (Rogue Valley Manor Project), VRDN, | |||||||||||
Deerfield Township, Ohio, GO, BAN, 3.45%, 11/18/08 | 3,050 | 3,050,000 | 4.25%, 8/15/37 (a)(n) | 17,200 | 17,200,000 | |||||||||
Fairfield, Ohio, Golf Course Improvements, GO, BAN, | Oregon State Facilities Authority Revenue Bonds | |||||||||||||
4%, 12/05/08 | 2,000 | 2,001,917 | (PeaceHealth), VRDN, Series B, 7.75%, | |||||||||||
Grove City, Ohio, Construction and Improvement | 8/01/34 (a)(n) | 12,825 | 12,825,000 | |||||||||||
Notes, GO, 2.32%, 3/12/09 | 9,530 | 9,530,240 | ||||||||||||
81,440,696 | ||||||||||||||
See Notes to Financial Statements. CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 21 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||
Par | Par | |||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||
Pennsylvania — 3.1% | Rhode Island — 0.2% | |||||||||||
Allegheny County, Pennsylvania, Hospital Development | Narragansett Bay Commission, Rhode Island, | |||||||||||
Authority Revenue Bonds, VRDN (a)(n): | Wastewater System Revenue Bonds, | |||||||||||
PUTTERS, Series 2327, 5.63%, 2/01/11 (b) | $ 5,885 | $5,885,000 | ROCS, VRDN, Series II-R-780PB, | |||||||||
(University of Pittsburgh Medical Center), | 4.12%, 2/01/32 (a)(b)(e)(n) | $ 13,895 | $ 13,895,000 | |||||||||
Series B-1, 4.16%, 12/01/16 | 6,293 | 6,293,000 | Rhode Island Housing and Mortgage Finance | |||||||||
Beaver County, Pennsylvania, IDA, PCR, Refunding | Corporation Revenue Bonds, ROCS, VRDN, | |||||||||||
(FirstEnergy Nuclear Generation Corporation | Series II-R-599, 4.82%, 4/01/33 (a)(b)(n) | 5,345 | 5,345,000 | |||||||||
Project), VRDN, Series B, 7.97%, 12/01/35 (a)(n) | 23,740 | 23,740,000 | 19,240,000 | |||||||||
Butler County, Pennsylvania, IDA, Revenue Bonds | ||||||||||||
(Concordia Lutheran Ministers), VRDN, Series A, | South Carolina — 1.5% | |||||||||||
8%, 4/01/30 (a)(n) | 4,905 | 4,905,000 | Bank of America MACON Trust, South Carolina | |||||||||
Delaware County, Pennsylvania, Authority, College | Jobs EDA, Revenue Bonds, VRDN, Series | |||||||||||
Revenue Bonds (Haverford College), VRDN, | 2007-303, 8%, 2/01/12 (a)(b)(n) | 9,080 | 9,080,000 | |||||||||
9%, 11/15/38 (a)(n) | 18,500 | 18,500,000 | Berkeley County, South Carolina, Exempt | |||||||||
Delaware Valley Regional Finance Authority, | Facilities, Industrial Revenue Bonds (Amoco | |||||||||||
Pennsylvania, Local Government Revenue Bonds, | Chemical Company Project), VRDN, AMT, | |||||||||||
VRDN, Series D, 7.85%, 12/01/20 (a)(n) | 25,000 | 25,000,000 | 4.05%, 4/01/28 (a)(n) | 4,600 | 4,600,000 | |||||||
Emmaus, Pennsylvania, General Authority Revenue | Eagle Tax-Exempt Trust, South Carolina State | |||||||||||
Bonds (Pennsylvania Loan Program), VRDN, | Public Service Authority, Revenue Bonds, | |||||||||||
Series A, 8.50%, 3/01/30 (a)(c)(n) | 13,200 | 13,200,000 | VRDN, Series 2006-0007, Class A, | |||||||||
Pennsylvania Economic Development Financing | 8.17%, 1/01/36 (a)(b)(d)(n) | 11,500 | 11,500,000 | |||||||||
Authority, Wastewater Treatment Revenue Refunding | Florence County, South Carolina, Solid Waste | |||||||||||
Bonds (Sunoco Inc. — R & M Project), VRDN, AMT, | Disposal and Wastewater Treatment Revenue | |||||||||||
Series B, 8.20%, 10/01/34 (a)(n) | 6,700 | 6,700,000 | Bonds (Roche Carolina Inc. Project), VRDN, | |||||||||
Pennsylvania HFA, Rental Housing Revenue Refunding | AMT (a)(n): | |||||||||||
Bonds, VRDN, Series B, 7.50%, 1/01/21 (a)(n) | 8,340 | 8,340,000 | 4.10%, 4/01/26 | 8,700 | 8,700,000 | |||||||
Pennsylvania HFA, S/F Mortgage Revenue Bonds, | 4.10%, 4/01/27 | 6,780 | 6,780,000 | |||||||||
VRDN, AMT (a)(n): | Greenville Hospital System, South Carolina, | |||||||||||
Series 86B, 8.15%, 4/01/35 | 9,410 | 9,410,000 | Hospital Facilities Revenue Refunding Bonds, | |||||||||
Series 87C, 8.30%, 10/01/35 | 17,300 | 17,300,000 | VRDN (a)(n): | |||||||||
Series 89, 8.15%, 10/01/35 | 53,235 | 53,235,000 | Series B, 7.85%, 5/01/33 | 4,500 | 4,500,000 | |||||||
Pennsylvania HFA, S/F Mortgage Revenue Refunding | Series C, 7.25%, 5/01/33 | 4,500 | 4,500,000 | |||||||||
Bonds, VRDN, AMT (a)(n): | Greenwood County, South Carolina, Exempt | |||||||||||
Series 91B, 8.15%, 10/01/36 | 9,200 | 9,200,000 | Facility Industrial Revenue Refunding Bonds | |||||||||
Series 99C, 8.20%, 10/01/23 | 5,100 | 5,100,000 | (Fuji Photo Film Project), VRDN, AMT, | |||||||||
Pennsylvania State Turnpike Commission, Turnpike | 8.25%, 9/01/11 (a)(n) | 12,200 | 12,200,000 | |||||||||
Revenue Refunding Bonds: | Piedmont Municipal Power Agency, South | |||||||||||
Series A-1, 7.95%, 12/01/30 | 28,375 | 28,375,000 | Carolina, Electric Revenue Refunding Bonds, | |||||||||
VRDN, Series A-2, 7.25%, 12/01/22 (a)(n) | 19,850 | 19,850,000 | VRDN, Series B, 8%, 1/01/34 (a)(f)(n) | 8,200 | 8,200,000 | |||||||
VRDN, Series B, 8.20%, 12/01/12 (a)(n) | 9,030 | 9,030,000 | South Carolina Housing Finance and | |||||||||
VRDN, Series U, 6.50%, 12/01/19 (a)(n) | 7,900 | 7,900,000 | Development Authority, Mortgage Revenue | |||||||||
Philadelphia, Pennsylvania, Hospitals and Higher | Bonds, ROCS, VRDN, AMT, Series II-R-398, | |||||||||||
Education Facilities Authority, Hospital Revenue | 5.92%, 7/01/34 (a)(b)(c)(n) | 2,005 | 2,005,000 | |||||||||
Refunding Bonds (Children’s Hospital Project), | South Carolina Jobs, EDA, EDR (Holcim (US) Inc. | |||||||||||
VRDN, Series A, 5%, 7/01/31 (a)(n) | 4,750 | 4,750,000 | Project), VRDN, AMT, 8.11%, 12/01/33 (a)(n) | 12,500 | 12,500,000 | |||||||
Philadelphia, Pennsylvania, Water and Wastewater | South Carolina Jobs, EDA, Hospital Facilities | |||||||||||
Revenue Refunding Bonds, VRDN, Series B, | Revenue Bonds (Sisters of Charity Providence | |||||||||||
8.05%, 8/01/18 (a)(c)(n) | 15,025 | 15,025,000 | Hospitals), VRDN, 7.50%, 11/01/31 (a)(n) | 45,780 | 45,780,000 | |||||||
Saint Mary Hospital Authority of Bucks County, | South Carolina Transportation Infrastructure Bank, | |||||||||||
Pennsylvania, Revenue Bonds (Catholic Health | Revenue Refunding Bonds, VRDN (a)(n): | |||||||||||
Initiatives), VRDN, Series C, 8%, 5/01/44 (a)(n) | 30,000 | 30,000,000 | Series B1, 7.50%, 10/01/31 | 5,300 | 5,300,000 | |||||||
University of Pittsburgh, Pennsylvania, The | Series B2, 8%, 10/01/31 | 4,800 | 4,800,000 | |||||||||
Commonwealth System of Higher Education, | Series B3, 7.95%, 10/01/31 | 7,900 | 7,900,000 | |||||||||
Revenue Bonds (University Capital Project), | Spartanburg, South Carolina, Waterworks Revenue | |||||||||||
VRDN (a)(n): | Bonds, ROCS, VRDN, Series II-R-11020PB, | |||||||||||
Series A, 8.25%, 9/15/39 | 6,500 | 6,500,000 | 4.14%, 6/01/36 (a)(b)(c)(n) | 13,360 | 13,360,000 | |||||||
Series C, 8.25%, 9/15/35 | 13,000 | 13,000,000 | 161,705,000 | |||||||||
341,238,000 | ||||||||||||
See Notes to Financial Statements. 22 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||||
Par | Par | |||||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||||
Tennessee — 2.6% | Texas — 15.0% | |||||||||||||
BNP Paribas STARS Certificates Trust, The | Brazos Harbor, Texas, Industrial Development | |||||||||||||
Tennergy Corporation, Tennessee, Gas | Corporation, Environmental Facilities Revenue | |||||||||||||
Revenue Bonds, VRDN, Series 2006-001, | Bonds (ConocoPhillips Company Project), VRDN, | |||||||||||||
4.20%, 5/01/16 (a)(n) | $ 8,780 | $ 8,780,000 | AMT, 8.25%, 8/01/38 (a)(n) | $ 4,500 | $ 4,500,000 | |||||||||
Chattanooga, Tennessee, Health, Education | Brazos River, Texas, Harbor Industrial Development | |||||||||||||
and Housing Facility Board Revenue Bonds | Corporation Revenue Bonds (BASF Corporation | |||||||||||||
(The McCallie School Project), VRDN, | Project), VRDN, AMT (a)(n): | |||||||||||||
7.90%, 7/01/25 (a)(n) | 15,950 | 15,950,000 | 8.75%, 10/01/36 | 50,000 | 50,000,000 | |||||||||
Clarksville, Tennessee, Public Building Authority, | 8.75%, 5/01/38 | 25,000 | 25,000,000 | |||||||||||
Pooled Financing Revenue Bonds (Tennessee | Clipper Tax-Exempt Certificates Trust, Texas, | |||||||||||||
Municipal Bond Fund), VRDN (a)(n): | Revenue Bonds, VRDN, Series 2007-46, | |||||||||||||
7.25%, 11/01/27 | 28,810 | 28,810,000 | 7.99%, 8/01/17 (a)(b)(i)(n) | 10,000 | 10,000,000 | |||||||||
7.25%, 6/01/29 | 35,105 | 35,105,000 | Collin County, Texas, GO, FLOATS, VRDN, Series 42-TP, | |||||||||||
Clarksville, Tennessee, Public Building Authority | 4.21%, 2/15/26 (a)(b)(n) | 10,925 | 10,925,000 | |||||||||||
Revenue Bonds, Pooled Financing (Tennessee | Cypress-Fairbanks, Texas, Independent School | |||||||||||||
Municipal Bond Fund), VRDN, 4.25%, | District, GO, FLOATS, VRDN, Series 86TP, | |||||||||||||
7/01/34 (a)(n) | 3,900 | 3,900,000 | 4.21%, 2/15/30 (a)(b)(d)(n) | 2,555 | 2,555,000 | |||||||||
Franklin, Tennessee, Public Building Authority, Local | Dallas-Fort Worth, Texas, International Airport Facility, | |||||||||||||
Government Public Improvement Revenue Bonds, | Improvement Corporation Revenue Refunding | |||||||||||||
VRDN, Series 101-A-1, 5.25%, 6/01/19 (a)(n) | 2,000 | 2,000,000 | Bonds (United Parcel Service Inc.), VRDN, | |||||||||||
Knox County, Tennessee, Health, Educational and | 5.15%, 5/01/32 (a)(n) | 5,050 | 5,050,000 | |||||||||||
Housing Facilities Board, Hospital Facilities | Dallas-Fort Worth, Texas, International Airport Revenue | |||||||||||||
Revenue Bonds (Catholic Healthcare Partners), | Bonds, ROCS, VRDN, AMT, Series II-R-12084, | |||||||||||||
VRDN, Series B, 7.97%, 10/01/31 (a)(n) | 4,200 | 4,200,000 | 4.69%, 11/01/13 (a)(b)(c)(n) | 8,430 | 8,430,000 | |||||||||
Metropolitan Government of Nashville and Davidson | Denton, Texas, Independent School District, GO, | |||||||||||||
County, Tennessee, Health and Educational | VRDN, Series 2005-A, 7.75%, 8/01/35 (a)(n) | 2,500 | 2,500,000 | |||||||||||
Facilities Board Revenue Bonds (Ascension Health), | Deutsche Bank SPEARs/LIFERs Trust, Brownsville, | |||||||||||||
VRDN, 7.75%, 11/15/31 (a)(n) | 33,000 | 33,000,000 | Texas, Utility System Revenue Bonds, SPEARs, | |||||||||||
Metropolitan Government of Nashville and Davidson | VRDN, Series DBE-533, 3.36%, 9/01/21 (a)(b)(n) | 1,785 | 1,785,000 | |||||||||||
County, Tennessee, IDB, Revenue Bonds (Nashville | Deutsche Bank SPEARs/LIFERs Trust, North | |||||||||||||
Symphony Hall Project), VRDN, Series A, | Texas Tollway Authority, Revenue Refunding | |||||||||||||
7.25%, 12/01/31 (a)(n) | 13,608 | 13,608,000 | Bonds, SPEARs, VRDN, Series DB-626, | |||||||||||
Montgomery County, Tennessee, Public Building | 4.08%, 1/01/32 (a)(b)(f)(n) | 11,487 | 11,487,000 | |||||||||||
Authority, Pooled Financing Revenue Bonds | Eagle Tax-Exempt Trust, Dallas, Texas, Area | |||||||||||||
(Tennessee County Loan Pool), VRDN, | Rapid Transit, Sales Tax Revenue Refunding | |||||||||||||
7.25%, 3/01/25 (a)(n) | 2,095 | 2,095,000 | Bonds, VRDN, Series 2008-0017, Class A, | |||||||||||
Municipal Energy Acquisition Corporation, Tennessee, | 8.24%, 12/01/43 (a)(b)(n) | 7,700 | 7,700,000 | |||||||||||
Gas Revenue Bonds, PUTTERS, VRDN, Series 1578, | Eagle Tax-Exempt Trust, San Antonio, Texas, | |||||||||||||
7.96%, 6/01/09 (a)(b)(n) | 49,815 | 49,815,000 | Independent School District, GO, Refunding, | |||||||||||
Sevier County, Tennessee, Public Building | VRDN, Series 2008-0034, Class A, | |||||||||||||
Authority, Local Government Public Improvement | 8.35%, 8/15/26 (a)(b)(n) | 5,000 | 5,000,000 | |||||||||||
Revenue Bonds, VRDN, Series IV-A-4, | Fort Bend County, Texas, GO, MSTR, VRDN, SGB-46-A, | |||||||||||||
5.50%, 6/01/20 (a)(c)(n) | 6,000 | 6,000,000 | 8.15%, 3/01/32 (a)(b)(d)(n) | 4,500 | 4,500,000 | |||||||||
Shelby County, Tennessee, GO, Refunding, VRDN, | Galena Park, Texas, Independent School District, | |||||||||||||
Series A, 7.90%, 3/01/22 (a)(n) | 7,355 | 7,355,000 | GO, Refunding, FLOATS, VRDN, Series SG-153, | |||||||||||
Shelby County, Tennessee, Health, Educational | 5.16%, 8/15/23 (a)(b)(n) | 12,250 | 12,250,000 | |||||||||||
and Housing Facility Board, Hospital Revenue | Grapevine, Texas, Industrial Development Corporation, | |||||||||||||
Refunding Bonds (Methodist Le Bonheur | Airport Revenue Refunding Bonds (Southern Air | |||||||||||||
Healthcare), VRDN (a)(f)(n): | Transport), VRDN, 7.55%, 3/01/10 (a)(n) | 5,300 | 5,300,000 | |||||||||||
Series A, 8.10%, 6/01/42 | 10,000 | 10,000,000 | Gulf Coast IDA, Texas, Environmental Facilities | |||||||||||
Series B, 7.93%, 6/01/42 | 10,000 | 10,000,000 | Revenue Bonds (Citgo Petroleum Corporation | |||||||||||
Shelby County, Tennessee, Public Improvement and | Project), VRDN, AMT, 4.05%, 10/01/32 (a)(n) | 8,400 | 8,400,000 | |||||||||||
Schools, GO, VRDN, Series B, 8%, 4/01/30 (a)(n) | 10,000 | 10,000,000 | Gulf Coast IDA, Texas, Marine Terminal Revenue | |||||||||||
The Tennergy Corporation, Tennessee, Gas | Bonds (Amoco Oil Company Project), VRDN, AMT, | |||||||||||||
Revenue Bonds, PUTTERS, VRDN, Series 1258Q, | 4.05%, 4/01/28 (a)(n) | 3,020 | 3,020,000 | |||||||||||
7.96%, 11/01/13 (a)(b)(n) | 43,805 | 43,805,000 | Gulf Coast IDA, Texas, Solid Waste Disposal Revenue | |||||||||||
284,423,000 | Bonds (Citgo Petroleum Corporation Project), | |||||||||||||
VRDN, AMT, 4.05%, 4/01/26 (a)(n) | 9,800 | 9,800,000 |
See Notes to Financial Statements. CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 23 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||||
Par | Par | |||||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||||
Texas (continued) | Texas (continued) | |||||||||||||
Gulf Coast Waste Disposal Authority, Texas, | Port Arthur, Texas, Navigation District, Environmental | |||||||||||||
Environmental Facilities Revenue Bonds | Facilities Revenue Refunding Bonds (Motiva | |||||||||||||
(American Aeryl LP Project), VRDN, AMT, | Enterprises Project), VRDN, AMT (a)(n): | |||||||||||||
8.40%, 5/01/38 (a)(n) | $ 19,000 | $19,000,000 | 7.75%, 12/01/27 | $ 17,335 | $17,335,000 | |||||||||
Gulf Coast Waste Disposal Authority, Texas, | 8.25%, 5/01/38 | 4,800 | 4,800,000 | |||||||||||
Environmental Facilities Revenue Refunding Bonds | Port Arthur, Texas, Navigation District, Industrial | |||||||||||||
(BP Products North America Project), VRDN, AMT, | Development Corporation, Exempt Facilities | |||||||||||||
4.05%, 7/01/36 (a)(n) | 11,200 | 11,200,000 | Revenue Bonds (Air Products and Chemicals | |||||||||||
Gulf Coast Waste Disposal Authority, Texas, Revenue | Project), VRDN, AMT (a)(n): | |||||||||||||
Bonds, VRDN, AMT (a)(n): | 8.55%, 4/01/36 | 10,000 | 10,000,000 | |||||||||||
(Air Products Project), 8.55%, 12/01/39 | 2,200 | 2,200,000 | 4.40%, 5/01/40 | 8,400 | 8,400,000 | |||||||||
(Waste Management Inc.), Series A, | Port Arthur, Texas, Navigation District Revenue Bonds | |||||||||||||
7.50%, 4/01/19 | 2,500 | 2,500,000 | (Atofina Petrochemicals), VRDN, AMT, Series B, | |||||||||||
Harris County, Texas, Flood Control District, GO, | 8%, 4/01/27 (a)(n) | 10,000 | 10,000,000 | |||||||||||
Refunding, VRDN, Series B, 8%, 10/01/24 (a)(n) | 16,320 | 16,320,000 | Port of Corpus Christi Authority, Texas, Nueces County | |||||||||||
Harris County, Texas, GO, TAN, 3%, 2/26/09 | 118,170 | 118,857,786 | Solid Waste Disposal, Revenue Refunding Bonds | |||||||||||
Harris County, Texas, Health Facilities Development | (Flint Hills Resources LP Project), VRDN, AMT, | |||||||||||||
Corporation, Revenue Refunding Bonds, VRDN (a)(n): | Series A, 8.26%, 7/01/29 (a)(n) | 22,650 | 22,650,000 | |||||||||||
(Methodist Hospital System), Series A, | Port of Houston Authority, Harris County, Texas, GO, | |||||||||||||
7.86%, 12/01/32 (l) | 98,875 | 98,875,000 | Refunding, ROCS, VRDN, AMT, Series II-R-9267, | |||||||||||
(Saint Luke’s Episcopal Health System), | 5.36%, 10/01/38 (a)(b)(n) | 7,325 | 7,325,000 | |||||||||||
Series A, 7.90%, 2/15/32 | 45,500 | 45,500,000 | RBC Municipal Products, Inc., Texas State Affordable | |||||||||||
(Saint Luke’s Episcopal Hospital), Series B, | Housing Corporation Revenue Bonds, FLOATS, VRDN, | |||||||||||||
4.25%, 2/15/31 | 10,000 | 10,000,000 | AMT, Series S-4, 4.95%, 1/01/19 (a)(b)(j)(k)(m)(n) | 5,575 | 5,575,000 | |||||||||
Houston, Texas, Airport System Revenue Refunding | Red River Authority, Texas, Solid Waste Disposal | |||||||||||||
Bonds, ROCS, VRDN, Series II-R-12046, | Revenue Bonds (Panda Hereford Ethanol Project), | |||||||||||||
4.52%, 7/01/12 (a)(b)(c)(n) | 13,200 | 13,200,000 | VRDN, AMT, 8.45%, 7/01/30 (a)(n) | 45,500 | 45,500,000 | |||||||||
Houston, Texas, Combined Utility System, First Lien | Red River, Texas, Education Finance Revenue Bonds | |||||||||||||
Revenue Refunding Bonds, VRDN (a)(n): | (Texas Christian University), VRDN (a)(n): | |||||||||||||
Series A-1, 7.25%, 5/15/34 | 10,000 | 10,000,000 | 7.75%, 3/01/30 | 24,900 | 24,900,000 | |||||||||
Series A-2, 7.25%, 5/15/34 | 6,200 | 6,200,000 | 8.25%, 3/15/35 | 14,500 | 14,500,000 | |||||||||
Houston, Texas, GO, TRAN, 3%, 6/30/09 | 24,000 | 24,230,220 | Sheldon, Texas, Independent School | |||||||||||
Houston, Texas, Higher Education Finance Corporation, | District, GO, PUTTERS, VRDN, Series 2009, | |||||||||||||
Higher Education Revenue Bonds, PUTTERS, VRDN, | 4.37%, 2/15/14 (a)(b)(n) | 5,215 | 5,215,000 | |||||||||||
Series 1865, 4.75%, 5/15/15 (a)(b)(n) | 5,065 | 5,065,000 | Socorro, Texas, Independent School District, | |||||||||||
Houston, Texas, Higher Education Finance Corporation, | GO, ROCS, VRDN, Series II-R-11540PB, | |||||||||||||
Revenue Refunding Bonds (Rice University Project), | 4.62%, 8/15/31 (a)(b)(n) | 12,710 | 12,710,000 | |||||||||||
VRDN, Series B, 4.25%, 5/15/48 (a)(n) | 36,000 | 36,000,000 | Southwest Texas Higher Education Authority | |||||||||||
Houston, Texas, Independent School District, GO, | Incorporated, Revenue Refunding Bonds (Southern | |||||||||||||
VRDN, 1.85%, 6/15/31 (a)(n) | 43,000 | 43,000,000 | Methodist University), VRDN, 4%, 7/01/15 (a)(n) | 8,900 | 8,900,000 | |||||||||
Houston, Texas, Utility System Revenue | Tarrant County, Texas, Cultural Education Facilities | |||||||||||||
Bonds, PUTTERS, VRDN, Series 2493, | Finance Corporation, Hospital Revenue Refunding | |||||||||||||
6.64%, 11/15/15 (a)(b)(c)(n) | 1,650 | 1,650,000 | Bonds (Scott and White Memorial Hospital), | |||||||||||
Houston, Texas, Utility System Revenue Refunding | VRDN (a)(n): | |||||||||||||
Bonds, ROCS, VRDN, Series II-R-4063, | Series B, 7.95%, 8/15/46 | 11,000 | 11,000,000 | |||||||||||
4.82%, 5/15/21 (a)(b)(c)(n) | 5,320 | 5,320,000 | Series C, 7.95%, 8/15/46 | 4,000 | 4,000,000 | |||||||||
Katy, Texas, Independent School District, School | Texas A&M University System, Permanent University | |||||||||||||
Building, GO, VRDN, 8%, 8/15/33 (a)(n) | 6,100 | 6,100,000 | Fund, CP, 1.68%, 11/06/08 | 15,000 | 15,000,000 | |||||||||
Municipal Securities Trust Certificates, Harris County, | Texas Municipal Gas Acquisition and Supply | |||||||||||||
Texas, Revenue Bonds, VRDN, Series SGC 31, | Corporation II, Gas Supply Revenue Bonds, | |||||||||||||
Class A, 2.98%, 8/15/35 (a)(b)(n) | 11,280 | 11,280,000 | ROCS, VRDN, Series II-R-10014, 5.65%, | |||||||||||
North Texas Municipal Water District, Texas, Water | 9/15/18 (a)(b)(n) | 11,000 | 11,000,000 | |||||||||||
System Revenue Bonds, VRDN (a)(b)(d)(n): | Texas State Department of Housing and Community | |||||||||||||
PUTTERS, Series 2488, 6.72%, 9/01/14 | 3,865 | 3,865,000 | Affairs, S/F Mortgage Revenue Refunding Bonds, | |||||||||||
ROCS, Series II-R-593PB, 4.71%, 9/01/35 | 8,430 | 8,430,000 | VRDN, AMT, Series A, 8.85%, 9/01/36 (a)(c)(n) | 5,140 | 5,140,000 | |||||||||
North Texas Tollway Authority Revenue Bonds, BAN, | Texas State, GO, FLOATS, VRDN, Series 66TP, | |||||||||||||
4.125%, 11/19/08 | 106,060 | 106,062,143 | 5.21%, 4/01/30 (a)(b)(n) | 15 | 15,000 | |||||||||
Texas State, GO, PUTTERS, VRDN (a)(b)(n): | ||||||||||||||
Series 2490, 6.61%, 4/01/15 | 1,850 | 1,850,000 | ||||||||||||
Series 2491, 6.65%, 10/01/13 | 1,525 | 1,525,000 |
See Notes to Financial Statements. 24 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | |||||||||||
(Percentages shown are based on Net Assets) | ||||||||||||
Par | Par | |||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | |||||||
Texas (concluded) | Virginia (concluded) | |||||||||||
Texas State, GO, TRAN, 3%, 8/28/09 | $478,000 | $483,927,419 | Henrico County, Virginia, Water and Sewer Revenue | |||||||||
Texas State, GO (Veterans’ Housing Assistance | Bonds, ROCS, VRDN, Series II-R-753 PB, | |||||||||||
Program Fund II), VRDN, AMT (a)(n): | 4.06%, 5/01/31 (a)(b)(d)(n) | $ 6,255 | $6,255,000 | |||||||||
Series A, 8.15%, 6/01/35 | 12,800 | 12,800,000 | Loudoun County, Virginia, IDA, Revenue Bonds | |||||||||
Series A, 8.15%, 6/01/37 | 6,755 | 6,755,000 | (Howard Hughes Medical Institute), VRDN (a)(n): | |||||||||
Series B, 8.15%, 6/01/34 | 22,800 | 22,800,000 | Series B, 7.85%, 2/15/38 | 13,500 | 13,500,000 | |||||||
Series B, 8.45%, 6/01/38 | 19,865 | 19,865,000 | Series F, 7.77%, 2/15/38 | 8,305 | 8,305,000 | |||||||
Texas State Transportation Commission, | Montgomery County, Virginia, IDA, Revenue Refunding | |||||||||||
First Tier Revenue Bonds, VRDN, Series B, | Bonds (Virginia Tech Foundation Project), VRDN, | |||||||||||
7.92%, 4/01/26 (a)(n) | 23,800 | 23,800,000 | 5%, 6/01/35 (a)(n) | 5,605 | 5,605,000 | |||||||
University of Texas, CP: | Richmond, Virginia, Public Utilities Revenue | |||||||||||
1.82%, 11/07/08 | 18,000 | 18,000,000 | Bonds, ROCS, VRDN, Series II-R-12180, | |||||||||
1.65%, 12/01/08 | 10,000 | 10,000,000 | 8.49%, 1/15/15 (a)(b)(c)(n) | 6,055 | 6,055,000 | |||||||
University of Texas, Financing System | Virginia College Building Authority, Educational | |||||||||||
Revenue Refunding Bonds, VRDN, Series B, | Facilities Revenue Bonds (21st Century College | |||||||||||
7.95%, 8/01/39 (a)(n) | 11,400 | 11,400,000 | and Equipment Programs), VRDN, Series B, | |||||||||
1,649,744,568 | 5%, 2/01/26 (a)(n) | 8,000 | 8,000,000 | |||||||||
Virginia State, HDA, Revenue Bonds, MERLOTS, | ||||||||||||
Utah — 0.8% | VRDN, AMT, Series B-19, 4.64%, 4/01/33 (a)(b)(n) | 3,000 | 3,000,000 | |||||||||
Murray City, Utah, Hospital Revenue Bonds | Virginia State, HDA, Revenue Refunding | |||||||||||
(IHC Health Services, Inc.), VRDN (a)(n): | Bonds, MERLOTS, VRDN, AMT, Series C-42, | |||||||||||
Series B, 7.83%, 5/15/36 | 12,600 | 12,600,000 | 4.52%, 7/01/23 (a)(b)(n) | 3,775 | 3,775,000 | |||||||
Series B, 4.25%, 5/15/37 | 4,890 | 4,890,000 | ||||||||||
Series D, 4.25%, 5/15/36 | 12,550 | 12,550,000 | 153,700,000 | |||||||||
Utah Transit Authority, Sales Tax Revenue Bonds, | Washington — 1.5% | |||||||||||
VRDN (a)(b)(c)(n): | Clark County, Washington, Public Utility District | |||||||||||
PUTTERS, Series 1107B, 5.25%, 12/15/13 | 4,995 | 4,995,000 | Number 001, Generating System Revenue | |||||||||
ROCS, Series II-R-609PB, 4.48%, 6/15/32 | 3,180 | 3,180,000 | Refunding Bonds, MSTR, VRDN, Series SGA-118, | |||||||||
Weber County, Utah, Hospital Revenue Bonds | 4.40%, 1/01/25 (a)(b)(c)(n) | 22,900 | 22,900,000 | |||||||||
(IHC Health Services), VRDN (a)(n): | Eagle Tax-Exempt Trust, Bellevue, Washington, | |||||||||||
Series A, 4.25%, 2/15/31 | 4,630 | 4,630,000 | GO, Refunding, VRDN, Series 2008-0025, | |||||||||
Series C, 4.25%, 2/15/35 | 39,575 | 39,575,000 | Class A, 8.53%, 12/01/43 (a)(b)(c)(d)(n) | 3,000 | 3,000,000 | |||||||
82,420,000 | Eclipse Funding Trust, Solar Eclipse Certificates, King | |||||||||||
County, Washington, Sewer Revenue Bonds, VRDN, | ||||||||||||
Vermont — 0.1% | Series 2007-0095, 4.78%, 1/01/17 (a)(b)(c)(n) | 3,335 | 3,335,000 | |||||||||
Vermont Educational and Health Buildings Financing | Energy Northwest, Washington, Electric Revenue | |||||||||||
Agency Revenue Bonds (Middlebury College | Refunding Bonds Project Number 3, VRDN, | |||||||||||
Project), VRDN, Series B, 3.40%, 11/01/32 (a)(n) | 7,050 | 7,050,000 | Series E, 7.92%, 7/01/17 (a)(n) | 7,000 | 7,000,000 | |||||||
Vermont HFA, S/F Revenue Bonds, VRDN, AMT, | King County, Washington, School District Number | |||||||||||
Series 16 A, 4.60%, 5/01/32 (a)(c)(n) | 725 | 725,000 | 410, Snoqualmie Valley, GO, ROCS, VRDN, | |||||||||
Vermont State Student Assistance Corporation, | Series II-R-4513, 5.02%, 12/01/20 (a)(b)(c)(n) | 4,320 | 4,320,000 | |||||||||
Education Loan Revenue Refunding Bonds, VRDN, | King County, Washington, Sewer Revenue | |||||||||||
AMT, Senior Series C-1, 8%, 12/15/40 (a)(n) | 7,000 | 7,000,000 | Bonds, ROCS, VRDN, Series II-R-10279, | |||||||||
14,775,000 | 4.76%, 7/01/17 (a)(b)(c)(n) | 12,575 | 12,575,000 | |||||||||
Virginia — 1.4% | Port Bellingham, Washington, Industrial Development | |||||||||||
Capital Beltway Funding Corporation of Virginia, | Corporation, Environmental Facilities Revenue | |||||||||||
Senior Lien Toll Revenue Bonds (I-495 Hot Lanes | Bonds (BP West Coast Products LLC Project), | |||||||||||
Project), VRDN, AMT (a)(n): | VRDN, AMT (a)(n): | |||||||||||
Series A, 8.05%, 12/31/47 | 16,000 | 16,000,000 | 4.05%, 12/01/33 | 4,800 | 4,800,000 | |||||||
Series B, 8%, 12/31/47 | 24,000 | 24,000,000 | 4.05%, 7/01/40 | 12,100 | 12,100,000 | |||||||
Series D, 8%, 12/31/47 | 5,000 | 5,000,000 | 4.05%, 7/01/41 | 20,000 | 20,000,000 | |||||||
Clipper Tax-Exempt Certificates Trust, Virginia | Port of Tacoma, Washington, GO, PUTTERS, VRDN, | |||||||||||
Commonwealth Transportation Board | Series 2439, 4.75%, 12/01/15 (a)(b)(c)(n) | 2,380 | 2,380,000 | |||||||||
Revenue Bonds, VRDN, Series 2007-7, | Seattle, Washington, Water System Revenue | |||||||||||
7.99%, 5/01/15 (a)(b)(i)(n) | 15,460 | 15,460,000 | Bonds, FLOATS, VRDN, Series 2170, | |||||||||
Fairfax County, Virginia, IDA, Revenue Bonds | 4.54%, 2/01/17 (a)(b)(c)(n) | 2,530 | 2,530,000 | |||||||||
(Inova Health System Project), VRDN, Series A-2, | Spokane County, Washington, Spokane School | |||||||||||
7.88%, 5/15/35 (a)(n) | 38,745 | 38,745,000 | District Number 081, GO, ROCS, VRDN, | |||||||||
Series II-R-4000, 4.35%, 12/01/19 (a)(b)(c)(n) | 3,425 | 3,425,000 |
See Notes to Financial Statements. CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 25 |
Schedule of Investments (continued) | Master Tax-Exempt LLC | ||||||||||||
(Percentages shown are based on Net Assets) | |||||||||||||
Par | Par | ||||||||||||
Municipal Bonds | (000) | Value | Municipal Bonds | (000) | Value | ||||||||
Washington (concluded) | Wyoming — 0.5% | ||||||||||||
Washington State, GO, PUTTERS, VRDN, Series 1312, | Campbell County, Wyoming, IDR, Refunding (Two | ||||||||||||
4.75%, 1/01/13 (a)(b)(c)(n) | $ 8,805 | $ 8,805,000 | Elk Generation Partners Project), VRDN, AMT, | ||||||||||
Washington State, GO, ROCS, VRDN (a)(b)(n): | 3.65%, 11/01/37 (a)(n) | $ 38,500 | $ 38,500,000 | ||||||||||
Series II-R-9253, 4.56%, 7/01/31 | 6,200 | 6,200,000 | Green River, Wyoming, Revenue Bonds (Rhone- | ||||||||||
Series II-R-11308, 4.23%, 1/01/33 | 2,990 | 2,990,000 | Poulenc of Wyoming, L Project), VRDN, AMT, | ||||||||||
Washington State, GO, VRDN, Series VR-96B, | 8.21%, 10/01/18 (a)(n) | 11,400 | 11,400,000 | ||||||||||
7.75%, 6/01/20 (a)(n) | 14,300 | 14,300,000 | Lincoln County, Wyoming, PCR (Exxon Project), VRDN, | ||||||||||
Washington State Health Care Facilities Authority | AMT (a)(n): | ||||||||||||
Revenue Bonds (PeaceHealth), VRDN, Series C, | Series A, 5.10%, 7/01/17 | 8,140 | 8,140,000 | ||||||||||
7.75%, 10/01/28 (a)(n) | 4,365 | 4,365,000 | Series C, 5.10%, 7/01/17 | 1,600 | 1,600,000 | ||||||||
Washington State Housing Finance Commission, CP, | 59,640,000 | ||||||||||||
1.58%, 10/09/08 | 20,800 | 20,800,000 | |||||||||||
Washington State Housing Finance Commission, | Puerto Rico — 0.1% | ||||||||||||
Nonprofit Revenue Bonds (Eastside Catholic | Puerto Rico Commonwealth Highway and | ||||||||||||
School), VRDN, Series B, 7.96%, 7/01/38 (a)(n) | 6,700 | 6,700,000 | Transportation Authority, Revenue Refunding | ||||||||||
Washington State Public Power Supply Systems | Bonds, ROCS, VRDN, Series II-R-10327CE, | ||||||||||||
Revenue Refunding Bonds (Nuclear Project Number | 4.45%, 8/29/09 (a)(b)(n) | 12,000 | 12,000,000 | ||||||||||
One), VRDN, Series 1A-1, 7.90%, 7/01/17 (a)(n) | 5,805 | 5,805,000 | Total Investments (Cost — $10,460,899,264*) — 95.3% | 10,460,899,264 | |||||||||
168,330,000 | Other Assets Less Liabilities — 4.7% | 512,323,099 | |||||||||||
West Virginia — 0.2% | Net Assets — 100.0% | $10,973,222,363 | |||||||||||
Monongalia County, West Virginia, Building | * | Cost for federal income tax purposes. | |||||||||||
Commission, Hospital Improvement | |||||||||||||
Revenue Refunding Bonds, VRDN, Series A, | (a) Variable rate security. Rate shown is as of report date. Maturity shown is the | ||||||||||||
8.10%, 7/01/40 (a)(n) | 15,800 | 15,800,000 | final maturity date. | ||||||||||
West Virginia EDA, Solid Waste Disposal | (b) These securities are short-term floating rate certificates issued by tender option | ||||||||||||
Facilities, Revenue Refunding Bonds (Ohio | bond trusts and are secured by the underlying municipal bond securities. | ||||||||||||
Power Company — Sporn Project), VRDN, | (c) FSA Insured. | ||||||||||||
Series C, 7.50%, 7/01/14 (a)(n) | 8,000 | 8,000,000 | |||||||||||
(d) MBIA Insured. | |||||||||||||
23,800,000 | |||||||||||||
(e) BHAC Insured. | |||||||||||||
Wisconsin — 3.3% | |||||||||||||
D.C. Everest Area School District, Wisconsin, | (f) Assured Guaranty Insured. | ||||||||||||
GO,MERLOTS, VRDN, Series D84, | (g) FGIC Insured. | ||||||||||||
3.96%, 4/01/15 (a)(b)(c)(n) | 5,840 | 5,840,000 | (h) Commonwealth Guaranteed. | ||||||||||
Kohler, Wisconsin, Solid Waste Disposal Revenue | |||||||||||||
Bonds (Kohler Company Project), VRDN, AMT, | (i) Security exempt from registration under Rule 144A of the Securities Act of | ||||||||||||
8.75%, 9/01/17 (a)(n) | 4,000 | 4,000,000 | 1933. These securities may be resold in transactions exempt from registration | ||||||||||
Milwaukee, Wisconsin, RAN, 3%, 9/03/09 | 3,900 | 3,949,387 | to qualified institutional investors. | ||||||||||
University of Wisconsin, Hospitals and Clinics | (j) FNMA Collateralized. | ||||||||||||
Authority, Revenue Refunding Bonds, VRDN, | (k) FHLMC Collateralized. | ||||||||||||
Series B, 4.25%, 4/01/34 (a)(n) | 5,600 | 5,600,000 | |||||||||||
Wisconsin Housing and EDA, Home Ownership | (l) U.S. government securities, held in escrow are used to pay interest on this | ||||||||||||
Revenue Refunding Bonds, VRDN, AMT, Series A, | security as well as to retire the bond in full at the date indicated, typically | ||||||||||||
8.20%, 3/01/35 (a)(n) | 21,070 | 21,070,000 | at a premium to par. | ||||||||||
Wisconsin School Districts, Cash Flow Management | (m) GNMA Collateralized. | ||||||||||||
Program, COP, VRDN, Series B, 4%, 10/30/08 (a)(n) | 9,400 | 9,406,979 | (n) Security may have a maturity of more than one year at the time of issuance, but | ||||||||||
Wisconsin State, CP: | has variable rate and demand features that qualify it as a short-term security. | ||||||||||||
1.50%, 10/07/08 | 10,000 | 10,000,000 | |||||||||||
1.53%, 10/08/08 | 9,257 | 9,257,000 | |||||||||||
1.85%, 11/13/08 | 7,942 | 7,942,000 | |||||||||||
Wisconsin State Health and Educational Facilities | |||||||||||||
Authority, Revenue Refunding Bonds, VRDN (a)(n): | |||||||||||||
(Fort Healthcare, Inc.), Series A, 4.78%, 5/01/37 | 18,190 | 18,190,000 | |||||||||||
(Medical College of Wisconsin), Series B, | |||||||||||||
7.95%, 12/01/33 | 9,600 | 9,600,000 | |||||||||||
(Wheaton Franciscan Services, Inc.), | |||||||||||||
7.92%, 8/15/36 | 52,510 | 52,510,000 | |||||||||||
Wisconsin State Operating Notes, 3%, 6/15/09 | 203,600 | 205,460,325 | |||||||||||
362,825,691 | |||||||||||||
See Notes to Financial Statements. 26 CMA TAX-EXEMPT FUND SEPTEMBER 30, 2008 |
Schedule of Investments (concluded) |
Master Tax-Exempt LLC |
•Effective April 1,2008,the Master LLC adopted Financial Accounting
Standards Board Statement of Financial Accounting Standards No. 157, “Fair
Value Measurements” (“FAS 157”). FAS 157 clarifies the definition of fair value,
establishes a framework for measuring fair values and requires additional
disclosures about the use of fair value measurements. Various inputs are used
in determining the fair value of investments, which are as follows:
•Level 1 — price quotations in active markets/exchanges for identical
securities
•Level 2 — other observable inputs (including,but not limited to: quoted prices
for similar assets or liabilities in markets that are not active, inputs other than
quoted prices that are observable for the assets or liabilities (such as interest
rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks,
and default rates) or other market-corroborated inputs)
•Level 3 — unobservable inputs based on the best information available
in the circumstance, to the extent observable inputs are not available
(including the Master LLC’s own assumption used in determining the fair
value of investments)
The inputs or methodology used for valuing securities are not necessarily an
indication of the risk associated with investing in those securities. For informa-
tion about the Master LLC’s policy regarding valuation of investments and other
significant accounting policies, please refer to Note 1 of the Notes to Financial
Statements.
The following table summarizes the inputs used as of September 30, 2008 in
determining the fair valuation of the Master LLC’s investments:
Valuation | Investments in | |
Inputs | Securities | |
Level 1 | — | |
Level 2 | $10,460,899,264 | |
Level 3 | — | |
Total | $10,460,899,264 | |
See Notes to Financial Statements. |
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
27 |
Statement of Assets and Liabilities
September 30, 2008 (Unaudited) | Master Tax-Exempt LLC | |
Assets | ||
Investments at value — unaffiliated | ||
(cost — $10,460,899,264) | $ 10,460,899,264 | |
Cash | 246,710,724 | |
Investments sold receivable | 220,609,647 | |
Interest receivable | 46,704,908 | |
Prepaid expenses | 236,357 | |
Total assets | 10,975,160,900 | |
Liabilities | ||
Investment advisory fees payable | 1,279,929 | |
Withdrawals payable to investors | 229,590 | |
Other affiliates payable | 92,335 | |
Other liabilities | 43,802 | |
Officer’s and Directors’ fees payable | 1,015 | |
Other accrued expenses payable | 291,866 | |
Total liabilities | 1,938,537 | |
Net Assets | $ 10,973,222,363 | |
Net Assets Consist of | ||
Investors’ capital | $ 10,973,222,363 | |
See Notes to Financial Statements. |
Statement of Operations | ||
Six Months Ended September 30, 2008 (Unaudited) | Master Tax-Exempt LLC | |
Investment Income | ||
Interest | $ 132,348,782 | |
Expenses | ||
Investment advisory | 8,038,100 | |
Accounting services | 532,923 | |
Custodian | 135,026 | |
Officer and Directors | 76,217 | |
Professional | 33,363 | |
Printing | 6,172 | |
Miscellaneous | 136,905 | |
Total expenses | 8,958,706 | |
Less fess paid indirectly | (1,401) | |
Total expenses after fees paid indirectly | 8,957,305 | |
Net investment income | 123,391,477 | |
Realized Gain | ||
Net realized gain from investments | 3,054 | |
Net Increase in Net Assets Resulting from Operations | $ 123,394,531 | |
28 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
Statements of Changes in Net Assets | Master Tax-Exempt LLC | |||||||||||
Six Months | ||||||||||||
Ended | Year | |||||||||||
September 30, | Ended | |||||||||||
2008 | March 31, | |||||||||||
Increase (Decrease) in Net Assets: | (Unaudited) | 2008 | ||||||||||
Operations | ||||||||||||
Net investment income | $ 123,391,477 | $ 358,549,432 | ||||||||||
Net realized gain | 3,054 | 1,625,744 | ||||||||||
Net increase in net assets resulting from operations | 123,394,531 | 360,175,176 | ||||||||||
Capital Transactions | ||||||||||||
Proceeds from contributions | 40,718,825,884 | 78,794,688,150 | ||||||||||
Fair value of withdrawals | (41,982,043,937) | (77,185,355,350) | ||||||||||
Net increase (decrease) in net assets derived from capital transactions | (1,263,218,053) | 1,609,332,800 | ||||||||||
Net Assets | ||||||||||||
Total increase (decrease) in net assets | (1,139,823,522) | 1,969,507,976 | ||||||||||
Beginning of period | 12,113,045,885 | 10,143,537,909 | ||||||||||
End of period | $10,973,222,363 | $12,113,045,885 | ||||||||||
Financial Highlights | Master Tax-Exempt LLC | |||||||||||
Six Months | ||||||||||||
Ended | ||||||||||||
September 30, | ||||||||||||
2008 | Year Ended March 31, | |||||||||||
(Unaudited) | 2008 | 2007 | 2006 | 2005 | 2004 | |||||||
Total Investment Return | ||||||||||||
Total investment return | 1.03%1 | 3.34% | 3.45% | 2.64% | 1.33% | 0.94% | ||||||
Ratios to Average Net Assets | ||||||||||||
Total expenses after fees paid indirectly | 0.15%2 | 0.15% | 0.15% | 0.15% | 0.15% | 0.15% | ||||||
Total expenses | 0.15%2 | 0.15% | 0.15% | 0.15% | 0.15% | 0.15% | ||||||
Net investment income and net realized gain (loss) | 2.03%2 | 3.28% | 3.44% | 2.61% | 1.31% | 0.94% | ||||||
Supplemental Data | ||||||||||||
Net assets, end of period (000) | $10,973,222 | $ 12,113,046 | $ 10,143,538 $ | 9,524,737 | $ 9,749,807 | $ 10,252,630 | ||||||
1 | Aggregate total investment return. |
2 | Annualized. |
See Notes to Financial Statements. |
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
29 |
Notes to Financial Statements (Unaudited) Master Tax-Exempt LLC |
1. Significant Accounting Policies: Master Tax-Exempt LLC (the “Master LLC”) is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), and is organized as a Delaware limited liability company. The Limited Liability Company Agreement permits the Directors to issue nontransferable inter- ests in the Master LLC, subject to certain limitations. Throughout this report, the Board of Trustees is referred to as the Board of Directors. The Master LLC’s financial statements are prepared in conformity with accounting principles generally accepted in the United States of America, which may require the use of management accruals and estimates. Actual results may differ from these estimates. The following is a summary of significant accounting policies followed by the Master LLC: Valuation of Investments: The Master LLC securities are valued under the amortized cost method which approximates current market value in accordance with Rule 2a-7 of the 1940 Act. Under this method, securi- ties are valued at cost when purchased and thereafter, a constant pro- portionate amortization of any discount or premium is recorded until the maturity of the security. Investment Transactions and Investment Income: Investment trans- actions are recorded on the dates the transactions are entered into (the trade dates). Realized gains and losses on security transactions are determined on the identified cost basis. Interest income is recognized on the accrual basis. The Master LLC amortizes all premiums and discounts on securities. Income Taxes: The Master LLC is classified as a partnership for federal income tax purposes. As such, each investor in the Master LLC is treated as owner of its proportionate share of the net assets, income, expenses and realized and unrealized gains and losses of the Master LLC. Therefore, no federal income tax provision is required. It is intended that the Master LLC’s assets will be managed so an investor in the Master LLC can satisfy the requirements of Subchapter M of the Internal Revenue Code. The Master LLC is disregarded as an entity separate from its owner for tax purposes, therefore it is not required to file income tax returns. Recent Accounting Pronouncement: In March 2008, Statement of Financial Accounting Standards No. 161, “Disclosures about Derivative Instruments and Hedging Activities — an amendment of FASB Statement No. 133” (“FAS 161”), was issued. FAS 161 is intended to improve financial reporting for derivative instruments by requiring enhanced disclosure that enables investors to understand how and why an entity uses derivatives, how derivatives are accounted for, and how derivative instruments affect an entity’s results of operations and financial |
position. In September 2008, FASB Staff Position No. 133-1 and FASB Interpretation No. 45-4 (the “FSP”), “Disclosures about Credit Derivatives and Certain Guarantees: An Amendment of FASB Statement No. 133 and FASB Interpretation No. 45; and Clarification of the Effective Date of FASB Statement No. 161” was issued and is effective for fiscal years and interim periods ending after November 15, 2008. The FSP amends FASB Statement No. 133, “Accounting for Derivative Instruments and Hedging Activities,” to require disclosures by sellers of credit derivatives, including credit derivatives embedded in hybrid instruments. The FSP also clarifies the effective date of FAS 161, whereby disclosures required by FAS 161 are effective for financial statements issued for fiscal years and interim periods beginning after November 15, 2008. The impact on the Master LLC’s financial statement disclosures, if any, is currently being assessed. Other: Expenses directly related to the Master LLC are charged to that Master LLC. Other operating expenses shared by several funds are pro- rated among those funds on the basis of relative net assets or other appropriate methods. 2. Investment Advisory Agreement and Other Transactions with Affiliates: The Master LLC has entered into an Investment Advisory Agreement with BlackRock Advisors, LLC (the “Advisor”), an indirect, wholly owned sub- sidiary of BlackRock, Inc., to provide investment advisory and adminis- tration services. Merrill Lynch & Co., Inc. (“Merrill Lynch”) and The PNC Financial Services Group, Inc. are principal owners of BlackRock, Inc. The Advisor is responsible for the management of the Master LLC’s investments and provides the necessary personnel, facilities, equipment and certain other services necessary to the operations of the Master LLC. For such services, the Master LLC pays the Advisor a monthly fee based upon the average daily value of the Master LLC’s net assets at the following annual rates: 0.25% of the Master LLC’s average daily net assets not exceeding $500 million; 0.175% of the average daily net assets in excess of $500 million, but not exceeding $1 billion; and 0.125% of the average daily net assets in excess of $1 billion. The Advisor has entered into a separate sub-advisory agreement with BlackRock Institutional Management Corporation (“BIMC”), an affiliate of the Advisor, under which the Advisor pays BIMC, for services it provides, a monthly fee that is a percentage of the investment advisory fee paid by Master LLC to the Advisor. For the six months ended September 30, 2008, the Master LLC reim- bursed the Advisor $88,795 for certain accounting services, which is included in accounting services in the Statement of Operations. |
30 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
Notes to Financial Statements (concluded) Master Tax-Exempt LLC
Pursuant to the terms of the custody agreemtent, custodian fees may be reduced by amounts calculated on uninvested cash balances, which are shown on the Statement of Operations as fees paid indirectly. Certain officers and/or directors of the Master LLC are officers and/or directors of BlackRock, Inc. or its affiliates. The Master LLC reimburses the Advisor for compensation paid to the Master LLC’s Chief Compliance Officer. 3. Subsequent Event: On September 15, 2008, Bank of America Corporation announced that it has agreed to acquire Merrill Lynch, one of the principal owners of BlackRock, Inc. The purchase has been approved by the directors of both companies. Subject to shareholder and regulatory approvals, the transaction is expected to close on or before December 31, 2008. |
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
31 |
Disclosure of Investment Advisory Agreement and Subadvisory Agreement
CMA Tax-Exempt Fund (the “Fund”) currently invests all of its investable assets in the Master Tax-Exempt LLC (the “Master LLC”). Accordingly, the Fund does not require investment advisory services, since all invest- ments are made at the Master LLC level. The Board of Directors of the Master LLC met in person in April and June 2008 to consider the approval of the Master LLC’s investment advisory agreement entered into with BlackRock Advisors, LLC (the “Advisor”) (the “Advisory Agreement”). The Board of the Master LLC also considered the approval of the subadvisory agreement between the Advisor and BlackRock Investment Management, LLC (the “Subadvisor”) (the “Subadvisory Agreement”). The Advisor and the Subadvisor are referred to herein as “BlackRock.” The Advisory Agreement and the Subadvisory Agreement are referred to herein as the “Agreements.” Since the Fund invests all of its investable assets in the Master LLC, the Board of Trustees of the Fund also considered the approval of the Agreements. For ease and clarity of presentation, the Board of Directors of the Master LLC and the Board of Trustees of the Fund, which are comprised of the same thirteen individuals, are herein referred to collectively as the “Boards,” the members of which are referred to as “Directors.” Activities and Composition of the Boards The Boards each consist of thirteen individuals, eleven of whom are not “interested persons” of either the Fund or the Master LLC as defined in the Investment Company Act of 1940, as amended (the “1940 Act”) (the “Independent Directors”). The Boards are responsible for the over- sight of the operations of the Fund and the Master LLC, as pertinent, and perform the various duties imposed on the directors of investment companies by the 1940 Act. The Independent Directors have retained independent legal counsel to assist them in connection with their duties. The Co-Chairs of each Board are both Independent Directors. The Boards established four standing committees: an Audit Committee, a Governance and Nominating Committee, a Compliance Committee and a Performance Oversight Committee, each of which is composed of, and chaired by, Independent Directors. The Agreements Upon the consummation of the combination of BlackRock’s investment management business with Merrill Lynch & Co., Inc.’s investment man- agement business, including Merrill Lynch Investment Managers, L. . and certain affiliates (the “Transaction”), the Master LLC entered into an Advisory Agreement with the Advisor with an initial two-year term and the Advisor entered into a Subadvisory Agreement with the Subadvisor with an initial two-year term. Consistent with the 1940 Act, prior to the expi- ration of each Agreement’s initial two-year term, the Boards are required to consider the continuation of the Agreements on an annual basis. In |
connection with this process, the Boards assessed, among other things, the nature, scope and quality of the services provided to the Fund and/or the Master LLC by the personnel of BlackRock and its affiliates, including investment management, administrative services, shareholder services, oversight of fund accounting and custody, marketing services and assistance in meeting legal and regulatory requirements. The Boards also received and assessed information regarding the services provided to the Fund and/or the Master LLC by certain unaffiliated service providers. Throughout the year, the Boards, acting directly and through their com- mittees, consider at each of their meetings factors that are relevant to their annual consideration of the renewal of the Agreements, including the services and support provided to the Fund and/or Master LLC and their shareholders. Among the matters the Boards considered, as perti- nent, were: (a) investment performance for one, three and five years, as applicable, against peer funds, as well as senior management’s and portfolio managers’ analysis of the reasons for underperformance, if applicable; (b) fees, including advisory, administration, if applicable, and other fees paid to BlackRock and its affiliates by the Fund and/or the Master LLC, such as transfer agency fees and fees for marketing and distribution; (c) Fund and/or Master LLC operating expenses; (d) the resources devoted to and compliance reports relating to the Fund’s and the Master LLC’s investment objective, policies and restrictions, (e) the Master LLC’s and the Fund’s compliance with their respective Code of Ethics and compliance policies and procedures; (f) the nature, cost and character of non-investment management services provided by BlackRock and its affiliates; (g) BlackRock’s and other service providers’ internal controls; (h) BlackRock’s implementation of the proxy voting guidelines approved by the Boards; (i) valuation and liquidity proce- dures; and (j) periodic overview of BlackRock’s business, including BlackRock’s response to the increasing scale of its business. Board Considerations in Approving the Agreements The Approval Process: Prior to the April 16, 2008 meeting at which approval of the Agreements was to be considered, the Boards requested and received materials specifically relating to the Agreements. The Boards are engaged in an ongoing process with BlackRock to continu- ously review the nature and scope of the information provided to better assist their deliberations. These materials included (a) information inde- pendently compiled and prepared by Lipper, Inc. (“Lipper”) on the Fund’s fees and expenses and the investment performance of the Fund as compared with a peer group of funds as determined by Lipper (“Peers”); (b) information on the profitability of the Agreements to BlackRock and certain affiliates, including their other relationships with the Fund and/ or the Master LLC, and a discussion of fall-out benefits; (c) a general |
32 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
Disclosure of Investment Advisory Agreement and Subadvisory Agreement (continued)
analysis provided by BlackRock concerning investment advisory fees charged to other clients, such as institutional and closed-end funds, under similar investment mandates, as well as the performance of such other clients; (d) a report on economies of scale; (e) sales and redemp- tion data regarding the Fund’s shares and the Master LLC’s interests; and (f) an internal comparison of management fees classified by Lipper, if applicable. At the April 16, 2008 meeting, the Boards requested and subsequently received from BlackRock (i) comprehensive analysis of total expenses on a fund-by-fund basis; (ii) further analysis of invest- ment performance; (iii) further data regarding Fund and Master LLC profitability, Fund and Master LLC size and Fund and Master LLC fee levels; and (iv) additional information on sales and redemptions. The Boards also considered other matters they deemed important to the approval process, such as payments made to BlackRock or its affiliates relating to the distribution of the Fund’s shares, services related to the valuation and pricing of portfolio holdings of the Master LLC, and direct and indirect benefits to BlackRock and its affiliates from their relation- ship with the Fund and the Master LLC. The Boards did not identify any particular information as controlling, and each Director may have attrib- uted different weights to the various items considered. At an in-person meeting held on April 16, 2008, the Boards discussed and considered the proposed renewal of the Agreements. As a result of the discussions, the Boards requested and BlackRock provided addition- al information, as detailed above, in advance of the June 3 – 4, 2008 Board meeting. At the in-person meeting held on June 3 – 4, 2008, the Boards, including the Independent Directors, unanimously approved the continuation of (a) the Advisory Agreement between the Advisor and the Master LLC for a one-year term ending June 30, 2009 and (b) the Subadvisory Agreement between the Advisor and the Subadvisor for a one-year term ending June 30, 2009. The Boards considered all factors they believed relevant with respect to the Fund and the Master LLC, as applicable, including, among other factors: (i) the nature, extent and quality of the services provided by BlackRock; (ii) the investment per- formance of the Fund, the Master LLC and BlackRock portfolio manage- ment; (iii) the advisory fee and the cost of the services and profits to be realized by BlackRock and certain affiliates from the relationships with the Fund and the Master LLC; and (iv) economies of scale. A. Nature, Extent and Quality of the Services: The Boards, including the Independent Directors, reviewed the nature, extent and quality of ser- vices provided by BlackRock, including the investment advisory services and the resulting performance of the Fund and the Master LLC. The Boards compared the Fund’s performance to the performance of a comparable group of mutual funds as classified by Lipper and the per- formance of at least one relevant index or combination of indices. The |
Boards met with BlackRock’s senior management personnel responsible for investment operations, including the senior investment officers. The Boards also reviewed the materials provided by the Master LLC’s port- folio management team discussing Master LLC performance and the Master LLC’s investment objective, strategies and outlook. The Boards considered, among other factors, the number, education and experience of BlackRock’s investment personnel generally, and of the Master LLC’s portfolio management team; BlackRock’s portfolio trading capabilities; BlackRock’s use of technology; BlackRock’s commitment to compliance; and BlackRock’s approach to training and retaining portfo- lio managers and other research, advisory and management personnel. The Boards also reviewed BlackRock’s compensation structure with respect to the portfolio management team of the Master LLC and BlackRock’s ability to attract and retain high-quality talent. In addition to advisory services, the Boards considered the quality of the administrative and non-investment advisory services provided to the Fund/Master LLC. BlackRock and its affiliates provide the Fund and the Master LLC with certain administrative, transfer agency, shareholder and other services (in addition to any such services provided to the Fund and the Master LLC by third parties) and officers and other personnel as are necessary for the operations of the Fund and the Master LLC. In addition to investment advisory services, BlackRock and its affiliates provide the Fund and the Master LLC with other services, including, as pertinent, (a) preparing disclosure documents, such as the prospectus, the statement of additional information and shareholder reports; (b) assisting with daily accounting and pricing; (c) overseeing and co- ordinating the activities of other service providers; (d) organizing Board meetings and preparing the materials for such Board meetings; (e) pro- viding legal and compliance support; and (f) performing other admi- nistrative functions necessary for the operation of the Fund and the Master LLC, such as tax reporting and fulfilling regulatory filing require- ments. The Boards reviewed the structure and duties of BlackRock’s fund administration, accounting, legal and compliance departments. B. The Investment Performance of the Fund, the Master LLC and BlackRock: The Boards, including the Independent Directors, also reviewed and considered the performance history of the Fund. In prepa- ration for the April 16, 2008 meeting, the Boards were provided with reports, independently prepared by Lipper, which included a comprehen- sive analysis of the Fund performance. The Boards also reviewed a nar- rative and statistical analysis of the Lipper data that was prepared by BlackRock, which analyzed various factors that affect Lipper rankings. In connection with their review, the Boards received and reviewed informa- tion regarding the investment performance of the Fund (and the related performance of the Master LLC) as compared to a representative group |
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
33 |
Disclosure of Investment Advisory Agreement and Subadvisory Agreement (continued)
of similar funds as determined by Lipper and to all funds in the Fund’s applicable Lipper category. The Boards were provided with a description of the methodology used by Lipper to select peer funds. The Boards reg- ularly review the performance of the Fund and the Master LLC through- out the year. The Boards attach more importance to performance over relatively long periods of time, typically three to five years. The Boards noted with favor that BlackRock had generally avoided significant credit quality and liquidity issues in the challenging fixed- income market that prevailed during the past 18 months. The Boards noted that the Fund performed above the median of its Peers in each of the one-, three- and five-year periods reported. C. Consideration of the Advisory Fees and the Cost of the Services and Profits to be Realized by BlackRock and its Affiliates from the Relationship with the Fund and the Master LLC: The Boards, including the Independent Directors, reviewed the Master LLC’s contractual advi- sory fee rates compared with the other funds in the Fund’s Lipper cate- gory. They also compared the Fund’s total expenses to those of other comparable funds. The Boards considered the services provided and the fees charged by BlackRock to other types of clients with similar invest- ment mandates, including separately managed institutional accounts. The Boards received and reviewed statements relating to BlackRock’s financial condition and profitability with respect to the services it provid- ed to the Master LLC. The Boards were also provided with a profitability analysis that detailed the revenues earned and the expenses incurred by BlackRock and certain affiliates that provide services to the Master LLC. The Boards reviewed BlackRock’s profitability with respect to the Master LLC and each fund the Boards currently oversee for the year ended December 31, 2007 compared to aggregated profitability data provided for the year ended December 31, 2005. In addition, the Boards considered the cost of the services provided to the Fund and the Master LLC by BlackRock, and BlackRock’s and its affiliates’ profits relating to the management and distribution, as pertinent, of the Fund and the Master LLC and the other funds advised by BlackRock and its affiliates. As part of their analysis, the Boards reviewed BlackRock’s methodology in allocating its costs to the manage- ment of the Fund and the Master LLC and concluded that there was a reasonable basis for the allocation. The Boards also considered whether BlackRock has the financial resources necessary to attract and retain high quality investment management personnel to perform its obligations under the Agreements and to continue to provide the high quality of services that are expected by the Boards. |
The Boards noted that the Fund/Master LLC paid contractual advisory fees, prior to any expense reimbursements, lower than or equal to the median of its Peers. The Boards also took into account that the Master LLC’s advisory fee arrangement includes breakpoints that adjust the fee rate downward as the size of the Master LLC increases, thereby allowing shareholders the potential to participate in economies of scale. D. Economies of Scale: The Boards, including the Independent Directors, considered the extent to which economies of scale might be realized as the assets of the Fund and the Master LLC increase and whether there should be changes in the advisory fee rate or structure in order to enable the Fund and the Master LLC to participate in these economies of scale. The Boards, including the Independent Directors, considered whether the shareholders would benefit from economies of scale and whether there was potential for future realization of economies with respect to the Fund and the Master LLC. The Boards considered that the funds in the BlackRock fund complex share common resources and, as a result, an increase in the overall size of the complex could permit each fund to incur lower expenses than it would otherwise as a stand-alone entity. The Boards also considered the anticipated efficiencies in the processes of BlackRock’s overall operations as it continues to add personnel and commit capital to expand the scale of operations. The Boards found, based on their review of comparable funds, that the Fund’s/Master LLC’s management fee is appropriate in light of the scale of the Fund/Master LLC. E. Other Factors: The Boards also took into account other ancillary or “fall-out” benefits that BlackRock may derive from its relationship with the Fund and the Master LLC, both tangible and intangible, such as BlackRock’s ability to leverage its investment professionals who manage other portfolios, an increase in BlackRock’s profile in the investment advisory community, and the engagement of BlackRock’s affiliates as service providers to the Fund and the Master LLC, including for adminis- trative, transfer agency and distribution services. The Boards also noted that BlackRock may use third party research, obtained by soft dollars generated by certain mutual fund transactions, to assist itself in manag- ing all or a number of its other client accounts. In connection with their consideration of the Agreements, the Boards also received information regarding BlackRock’s brokerage and trade execution practices throughout the year. |
34 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
Disclosure of Investment Advisory Agreement and Subadvisory Agreement (concluded) |
Conclusion The Boards approved the continuation of (a) the Advisory Agreement between the Advisor and the Master LLC with respect to the Fund/ Master LLC for a one-year term ending June 30, 2009 and (b) the Subadvisory Agreement between the Advisor and Subadvisor for a one- year term ending June 30, 2009. Based upon their evaluation of all these factors in their totality, the Boards, including the Independent Directors, were satisfied that the terms of the Agreements were fair and reasonable and in the best interest of the Fund and the Master LLC and the Fund’s shareholders. In arriving at a decision to approve the Agreements, the Boards did not identify any single factor or group of fac- tors as all-important or controlling, but considered all factors together. The Independent Directors were also assisted by the advice of independ- ent legal counsel in making this determination. The contractual fee arrangements for the Fund and the Master LLC reflect the results of several years of review by the Directors and predecessor Directors, and discussions between the Directors (and predecessor Directors) and BlackRock (and predecessor advisors). Certain aspects of the arrange- ments may be the subject of more attention in some years than in others, and the Directors’ conclusions may be based in part on their consideration of these arrangements in prior years. |
CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
35 |
Officers and Directors Ronald W. Forbes, Co-Chairman of the Board and Director Rodney D. Johnson, Co-Chairman of the Board and Director David O. Beim, Director Richard S. Davis, Director Henry Gabbay, Director Dr. Matina Horner, Director Herbert I. London, Director Cynthia A. Montgomery, Director Joseph . Platt, Jr., Director Robert C. Robb, Jr., Director Toby Rosenblatt, Director Kenneth L. Urish, Chairman of the Audit Committee and Director Frederick W. Winter, Director Donald C. Burke, Trust President and Chief Executive Officer Anne F. Ackerley, Vice President Neal J. Andrews, Chief Financial Officer Jay M. Fife, Treasurer Brian . Kindelan, Chief Compliance Officer of the Fund/Master LLC Howard B. Surloff, Secretary |
Custodian State Street Bank and Trust Company Boston, MA 02101 Transfer Agent Financial Data Services, Inc. Jacksonville, FL 32246 Accounting Agent State Street Bank and Trust Company Princeton, NJ 08540 Independent Registered Public Accounting Firm Deloitte & Touche LLP Princeton, NJ 08540 Legal Counsel Sidley Austin LLP New York, NY 10019 |
36 CMA TAX-EXEMPT FUND |
SEPTEMBER 30, 2008 |
Additional Information Availability of Quarterly Schedule of Investments The Fund/Master LLC files its complete schedule of portfolio holdings with the Securities and Exchange Commission (“SEC”) for the first and third quarters of each fiscal year on Form N-Q. The Fund’s/Master LLC’s Forms N-Q are available on the SEC’s website at http://www.sec.gov and may also 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 (800) SEC-0330. The Fund’s/Master LLC’s Forms N-Q may also be obtained upon request and without charge by calling (800) 441-7762. |
Electronic Delivery Electronic copies of most financial reports and prospectuses are available on the Fund’s website or shareholders can sign up for e-mail notifications of quarterly statements, annual and semi-annual reports and prospec- tuses by enrolling in the Fund’s electronic delivery program. |
Shareholders Who Hold Accounts with Investment Advisors, Banks or Brokerages: Please contact your financial advisor to enroll. Please note that not all investment advisors, banks or brokerages may offer this service. |
General Information The Fund will mail only one copy of shareholder documents, including annual and semi-annual reports and proxy statements, to shareholders with multiple accounts at the same address. This practice is commonly called “householding” and it is intended to reduce expenses and eliminate duplicate mailings of shareholder documents. Mailings of your shareholder |
documents may be householded indefinitely unless you instruct us other- wise. If you do not want the mailing of these documents to be combined with those for other members of your household, please contact the Fund at (800) 441-7762. |
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SEPTEMBER 30, 2008 |
37 |
Additional Information (concluded) BlackRock Privacy Principles BlackRock is committed to maintaining the privacy of its current and for- mer fund investors and individual clients (collectively, “Clients”) and to safeguarding their non-public personal information. The following infor- mation is provided to help you understand what personal information BlackRock collects, how we protect that information and why in certain cases we share such information with select parties. If you are located in a jurisdiction where specific laws, rules or regulations require BlackRock to provide you with additional or different privacy- related rights beyond what is set forth below, then BlackRock will comply with those specific laws, rules or regulations. BlackRock obtains or verifies personal non-public information from and about you from different sources, including the following: (i) information we receive from you or, if applicable, your financial intermediary, on appli- cations, forms or other documents; (ii) information about your transac- tions with us, our affiliates, or others; (iii) information we receive from a consumer reporting agency; and (iv) from visits to our websites. |
BlackRock does not sell or disclose to non-affiliated third parties any non-public personal information about its Clients, except as permitted by law or as is necessary to respond to regulatory requests or to service Client accounts. These non-affiliated third parties are required to protect the confidentiality and security of this information and to use it only for its intended purpose. We may share information with our affiliates to service your account or to provide you with information about other BlackRock products or services that may be of interest to you. In addition, BlackRock restricts access to non-public personal information about its Clients to those BlackRock employees with a legitimate business need for the information. BlackRock maintains physical, electronic and procedural safeguards that are designed to protect the non-public personal information of its Clients, including procedures relating to the proper storage and disposal of such information. |
38 CMA TAX-EXEMPT FUND |
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This report is transmitted to shareholders only. It is not authorized for use as an offer of sale or a solicitation of an offer to buy shares of the Fund unless accompanied or preceded by the Fund’s current prospectus. An investment in the Fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other govern- ment agency other than with respect to the Fund’s participation in the U.S. Treasury Department Guarantee Program for Money Market Funds disclosed in this semi-annual report. Although the Fund seeks to preserve the value of your investment at $1.00 per share, it is possible to lose money by investing in the Fund. Total return information assumes reinvestment of all distributions. Past perf- ormance results shown in this report should not be considered a representation of future performance. For current month-end performance information, call (800) 882-0052. The Fund’s current seven-day yield more closely reflects the current earnings of the Fund than the total returns quoted. Statements and other informa- tion herein are as dated and are subject to change. A description of the policies and procedures that the Fund uses to determine how to vote proxies relating to portfolio securities is available (1) without charge, upon request, by calling toll- free (800) 441-7762; (2) at www.blackrock.com; and (3) on the Securities and Exchange Commission’s website at http://www.sec.gov. Information about how the Fund voted proxies relating to securities held in the Fund’s portfolio during the most recent 12-month period ended June 30 is available (1) at www.blackrock.com or by calling (800) 441-7762 and (2) on the Securities and Exchange Commission’s website at http://www.sec.gov. |
CMA Tax-Exempt Fund 100 Bellevue Parkway Wilmington, DE 19809 |
#11214-9/08
Item 2 – Code of Ethics – Not Applicable to this semi-annual report Item 3 – Audit Committee Financial Expert – Not Applicable to this semi-annual report Item 4 – Principal Accountant Fees and Services – Not Applicable to this semi-annual report Item 5 – Audit Committee of Listed Registrants – Not Applicable Item 6 – Investments (a) The registrant’s Schedule of Investments is included as part of the Report to Stockholders filed under Item 1 of this form. (b) Not Applicable due to no such divestments during the semi-annual period covered since the previous Form N-CSR filing. Item 7 – Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies – Not Applicable Item 8 – Portfolio Managers of Closed-End Management Investment Companies – Not Applicable Item 9 – Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers – Not Applicable Item 10 – Submission of Matters to a Vote of Security Holders – The registrant’s Nominating and Governance Committee will consider nominees to the board of directors recommended by shareholders when a vacancy becomes available. Shareholders who wish to recommend a nominee should send nominations that include biographical information and set forth the qualifications of the proposed nominee to the registrant’s Secretary. There have been no material changes to these procedures. Item 11 – Controls and Procedures 11(a) – The registrant’s principal executive and principal financial officers or persons performing similar functions have concluded that the registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the “1940 Act”)) are effective as of a date within 90 days of the filing of this report based on the evaluation of these controls and procedures required by Rule 30a-3(b) under the 1940 Act and Rule 15d-15(b) under the Securities Exchange Act of 1934, as amended. 11(b) – There were no changes in the registrant’s internal control over financial reporting (as defined in Rule 30a- 3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting. Item 12 – Exhibits attached hereto 12(a)(1) – Code of Ethics – Not Applicable to this semi-annual report 12(a)(2) – Certifications – Attached hereto 12(a)(3) – Not Applicable 12(b) – Certifications – Attached hereto Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. |
CMA Tax-Exempt Fund and Master Tax-Exempt LLC By: /s/ Donald C. Burke Donald C. Burke Chief Executive Officer of CMA Tax-Exempt Fund and Master Tax-Exempt LLC Date: November 24, 2008 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ Donald C. Burke Donald C. Burke Chief Executive Officer (principal executive officer) of CMA Tax-Exempt Fund and Master Tax-Exempt LLC Date: November 24, 2008 By: /s/ Neal J. Andrews Neal J. Andrews Chief Financial Officer (principal financial officer) of CMA Tax-Exempt Fund and Master Tax-Exempt LLC Date: November 24, 2008 |