UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number | 811-03706 | |||||
AMERICAN CENTURY CALIFORNIA TAX-FREE AND MUNICIPAL FUNDS | ||||||
(Exact name of registrant as specified in charter) | ||||||
4500 MAIN STREET, KANSAS CITY, MISSOURI | 64111 | |||||
(Address of principal executive offices) | (Zip Code) | |||||
CHARLES A. ETHERINGTON 4500 MAIN STREET, KANSAS CITY, MISSOURI 64111 | ||||||
(Name and address of agent for service) | ||||||
Registrant’s telephone number, including area code: | 816-531-5575 | |||||
Date of fiscal year end: | 08-31 | |||||
Date of reporting period: | 08-31-2016 |
ITEM 1. REPORTS TO STOCKHOLDERS.
![acihorizblkb99.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/acihorizblkb99.jpg)
Annual Report | |
August 31, 2016 | |
California Long-Term Tax-Free Fund |
Table of Contents |
President’s Letter | 2 | |
Performance | 3 | |
Portfolio Commentary | ||
Fund Characteristics | ||
Shareholder Fee Example | ||
Schedule of Investments | ||
Statement of Assets and Liabilities | ||
Statement of Operations | ||
Statement of Changes in Net Assets | ||
Notes to Financial Statements | ||
Financial Highlights | ||
Report of Independent Registered Public Accounting Firm | ||
Management | ||
Approval of Management Agreement | ||
Proxy Voting Results | ||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![jthomasrev0514.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/jthomasrev0514.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended August 31, 2016. It provides investment performance and portfolio information for the reporting period, plus longer-term historical performance data.
Annual reports remain important vehicles for conveying information about fund returns, including market factors that affected performance during the reporting period. For additional, updated investment and market insights, we encourage you to visit our website, americancentury.com.
Municipal Bonds (Munis) Generally Extended Their Solid Performance
Key conditions described in our semiannual report letter extended for another six months. Widespread concerns about global economic growth sparked financial market volatility, followed by monetary policy reactions from central banks. The primary catalyst in 2015 was China, where slowing economic growth and currency devaluations sent shock waves through the global markets. These factors re-emerged in January and early February 2016, triggering sell-offs in riskier assets such as stocks and high-yield bonds and encouraging central banks in Japan and Europe to cut interest rates and/or extend their bond-buying (quantitative easing, QE) programs. More QE came after Brexit, the U.K.’s vote to exit the European Union. Monetary policy expansion produced negative interest rates in Japan and Europe, and lowered longer-maturity bond yields globally.
In this bond-friendly environment, munis generally continued to perform well. The broad muni market benefited from its comparatively high overall credit quality, despite defaults in Puerto Rico and financial concerns facing Illinois and New Jersey. We continue to view these as isolated incidents running counter to overall muni credit quality trends. Also, as government bond yields fell globally, after-tax muni yields looked attractive, especially for investors in top tax brackets.
After 12 straight months of positive performance for the broad muni market, we’re positioning muni portfolios for increased volatility (and the possibility of lower returns) after heavy demand compressed the yield differences (spreads) between shorter- and longer-maturity bonds, and higher- and lower-quality bonds. Spreads narrowed to an extent in August 2016 that would indicate a greater chance of widening than narrowing, given the uncertainties ahead, including central bank reviews of their QE programs, the Federal Reserve’s desire to raise interest rates, the fallout from Brexit, and the U.S. presidential election. We appreciate your continued trust in us during this challenging period.
Sincerely,
![image48a01.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/image48a01.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
2
Performance |
Total Returns as of August 31, 2016 | ||||||
Average Annual Returns | ||||||
Ticker Symbol | 1 year | 5 years | 10 years | Since Inception | Inception Date | |
Investor Class | BCLTX | 7.62% | 5.65% | 4.79% | — | 11/9/83 |
Bloomberg Barclays Municipal Bond Index | — | 6.88% | 4.80% | 4.87% | — | — |
Institutional Class | BCLIX | 7.83% | 5.87% | — | 5.82% | 3/1/10 |
A Class | ALTAX | 9/28/07 | ||||
No sales charge | 7.35% | 5.39% | — | 4.81% | ||
With sales charge | 2.53% | 4.42% | — | 4.27% | ||
C Class | ALTCX | 6.55% | 4.61% | — | 4.03% | 9/28/07 |
Average annual returns since inception are presented when ten years of performance history is not available.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 4.50% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
3
Growth of $10,000 Over 10 Years |
$10,000 investment made August 31, 2006 |
Performance for other share classes will vary due to differences in fee structure. |
![acctfmf831_chart-54112.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/acctfmf831_chart-54112.jpg)
Value on August 31, 2016 | |
Investor Class — $15,977 | |
Bloomberg Barclays Municipal Bond Index — $16,093 | |
Total Annual Fund Operating Expenses | |||
Investor Class | Institutional Class | A Class | C Class |
0.47% | 0.27% | 0.72% | 1.47% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
4
Portfolio Commentary |
Portfolio Managers: Joseph Gotelli, Alan Kruss, and Steven Permut
Performance Summary
California Long-Term Tax-Free returned 7.62%* for the 12 months ended August 31, 2016, outperforming the Bloomberg Barclays Municipal Bond Index, which returned 6.88%. Fund returns reflect operating expenses, while index returns do not.
The fund’s absolute return for the reporting period reflected the positive overall performance of municipal bonds (munis) and California and longer-maturity munis in particular. The muni market generally rallied, posting a positive total return in each of the 12 months and outperforming the U.S. Treasury market and the broad taxable investment-grade U.S. fixed-income market for the entire period. In addition to benefiting from a favorable backdrop for U.S. fixed-income securities—which included declining interest rates and muted inflation—munis advanced on stable credit trends, positive flows, and other supportive supply/demand factors.
Favorable Fixed-Income Backdrop, Muni Market Dynamics Fueled Gains
Investor concerns about global growth, commodity prices, and central bank monetary decisions generated volatility during the 12-month period. The U.S. economy continued to exhibit modest growth, particularly compared with the rest of the developed world, but the U.S. Federal Reserve (the Fed) remained focused on the sluggish global landscape and its potential risks to the U.S. economy. This triggered ongoing investor speculation regarding the timing and magnitude of Fed interest rate “normalization” and contributed to the volatile climate. However, the Fed implemented only one rate hike during the period—a 25 basis point increase (1 basis point equals 0.01%) on December 16, 2015, which pushed the range for the federal funds rate target to 0.25%-0.50%.
Despite expectations for additional rate hikes in 2016, the Fed cited concerns about the health of the global economy, the uncertainty triggered by the U.K. vote in late June to exit the European Union (Brexit), and weaker-than-expected U.S. economic growth as reasons to pursue a “lower for longer” rate strategy. Meanwhile, central banks in Europe, Japan, and China continued to implement aggressive stimulus programs in response to weak growth rates and deflation threats in those regions. This action increased the relative attractiveness of the U.S. bond market, where yields were generally higher.
This environment led to positive performance for U.S. Treasuries and other U.S. bond market sectors. Munis generally tracked the U.S. Treasury market, but factors specific to the municipal market helped munis outperform. In particular, supply and demand dynamics remained favorable and supported gains. Overall supply increased only slightly, while demand for munis remained robust due to the tax advantages and perceived “safe-haven” munis offered investors. As of August 31, 2016, muni funds experienced 48 consecutive weeks of positive flows, according to Lipper Inc.
Overall, all major sectors of the muni bond market posted positive returns for the 12-month period, according to Bloomberg Barclays. Reflecting investor demand for yield, longer-maturity and lower-quality munis generally performed better than shorter-maturity and higher-quality securities. In addition, revenue bonds outperformed general obligation (GO) bonds.
* All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund's benchmark, other share classes may not. See page 3 for returns for all share classes.
5
State and National Fiscal, Credit Backdrops Were Generally Positive
State and local finances in California and across the U.S. remained relatively healthy, even as tax revenue growth slowed due to stock market volatility. Spending restraint enabled most states, including California, to maintain stable credit profiles. Furthermore, California’s job growth outpaced the national average, and the state’s housing market continued to improve. In addition, state officials reported $7.3 billion in reserves at the end of fiscal year 2016 and projected reserves would climb to $8.5 billion by the end of fiscal year 2017. Also, in August 2016, Fitch Ratings upgraded California’s bond credit rating from “A+” to “AA-.”
From a national credit rating perspective, downgrades outpaced upgrades in the second calendar quarter of 2016, largely due to troubled credits in Illinois and Michigan. Overall, the national muni default rate remained low. We continue to believe it is unlikely any states will default, but special circumstances may continue to pressure isolated state, local, and commonwealth credit ratings, such as those in Puerto Rico, Illinois, New Jersey, and Michigan.
Longer Maturity, Longer Duration Drove Outperformance
Our maturity strategy primarily accounted for the portfolio’s outperformance versus the Bloomberg Barclays index. In particular, we maintained a slight flattening bias with respect to the portfolio’s yield-curve positioning, holding more exposure to longer-maturity munis than the index. This strategy aided relative performance as yields on longer-maturity securities declined more than yields on shorter-maturity munis, causing the muni yield curve to flatten. The portfolio’s duration (price sensitivity to interest rate changes), which was slightly longer than the index’s, also lifted performance in this yield environment.
Elsewhere, sector and security selection produced mixed results relative to the index. Overall, our preference for revenue bonds over GO bonds aided results. Within the revenue sector, an overweight position relative to the index in lease revenue bonds aided results, while an underweight position in industrial development revenue bonds detracted. Meanwhile, security selection among special tax and water and sewer bonds aided relative results, while our selections among lease revenue and local GO bonds detracted.
Focus on Yield in Range-Bound Market
We believe U.S. economic fundamentals support slightly higher interest rates. But low inflation, weaker global economic fundamentals, low interest rates in Europe and Japan, weak commodity prices, a strong U.S. dollar, and geopolitical uncertainty (particularly in the wake of the Brexit vote) will, in our view, likely keep Fed action slow and data dependent, and keep rates range-bound in the near term. For this reason, we are comfortable maintaining a slightly longer-than-average duration and a slight bias toward lower-quality credits—two strategies that have helped enhance the portfolio’s yield. We also believe volatility may escalate ahead of the November U.S. presidential election, and such volatility may cause credit spreads (the yield differential between high-quality and low-quality munis of similar maturity) to widen. This potential backdrop may present compelling buying opportunities among lower-quality credits. In this environment, we believe fundamental credit research, active management, and security selection will become increasingly important.
6
Fund Characteristics |
AUGUST 31, 2016 | |
Portfolio at a Glance | |
Weighted Average Maturity | 17.7 years |
Average Duration (Modified) | 5.6 years |
Top Five Sectors | % of fund investments |
General Obligation (GO) - Local | 16% |
Hospital | 13% |
General Obligation (GO) - State | 11% |
Lease Revenue | 9% |
Prerefunded | 8% |
Types of Investments in Portfolio | % of net assets |
Municipal Securities | 101.9% |
Other Assets and Liabilities | (1.9)% |
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from March 1, 2016 to August 31, 2016.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or Institutional Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not a financial intermediary or retirement plan account), American Century Investments may charge you a $12.50 semiannual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $12.50 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments Brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments Brokerage accounts, you are currently not subject to this fee. If you are subject to the Account Maintenance Fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 3/1/16 | Ending Account Value 8/31/16 | Expenses Paid During Period(1) 3/1/16 - 8/31/16 | Annualized Expense Ratio(1) | |
Actual | ||||
Investor Class | $1,000 | $1,039.60 | $2.41 | 0.47% |
Institutional Class | $1,000 | $1,040.60 | $1.38 | 0.27% |
A Class | $1,000 | $1,038.30 | $3.69 | 0.72% |
C Class | $1,000 | $1,034.40 | $7.52 | 1.47% |
Hypothetical | ||||
Investor Class | $1,000 | $1,022.77 | $2.39 | 0.47% |
Institutional Class | $1,000 | $1,023.78 | $1.37 | 0.27% |
A Class | $1,000 | $1,021.52 | $3.66 | 0.72% |
C Class | $1,000 | $1,017.75 | $7.46 | 1.47% |
(1) | Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 184, the number of days in the most recent fiscal half-year, divided by 366, to reflect the one-half year period. |
9
Schedule of Investments |
AUGUST 31, 2016
Principal Amount | Value | |||||
MUNICIPAL SECURITIES — 101.9% | ||||||
California — 101.2% | ||||||
ABAG Finance Authority for Nonprofit Corps. Rev., (Sharp Healthcare Obligated Group), 6.00%, 8/1/30 | $ | 1,000,000 | $ | 1,220,470 | ||
ABAG Finance Authority for Nonprofit Corps. Rev., (Sharp Healthcare Obligated Group), 6.25%, 8/1/39 | 1,200,000 | 1,387,404 | ||||
ABAG Finance Authority for Nonprofit Corps. Rev., (Sharp Healthcare Obligated Group), 5.00%, 8/1/43 | 500,000 | 595,015 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/37 | 1,000,000 | 1,217,600 | ||||
Alameda Corridor Transportation Authority Rev., Capital Appreciation, 0.00%, 10/1/32 (NATL)(1) | 1,000,000 | 623,890 | ||||
Alameda Corridor Transportation Authority Rev., Capital Appreciation, 0.00%, 10/1/35 (NATL)(1) | 3,750,000 | 2,059,575 | ||||
Alum Rock Union Elementary School District GO, 6.00%, 8/1/39 | 1,000,000 | 1,296,370 | ||||
Anaheim Public Financing Authority Rev., 5.375%, 10/1/36 | 300,000 | 354,369 | ||||
Anaheim Public Financing Authority Rev., 5.25%, 10/1/39 | 2,500,000 | 2,769,450 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 5/1/46 | 2,200,000 | 2,646,094 | ||||
Bay Area Toll Authority Rev., 5.00%, 4/1/43 | 2,655,000 | 3,207,665 | ||||
Bay Area Toll Authority Rev., 5.00%, 10/1/54 | 1,500,000 | 1,800,525 | ||||
Bay Area Toll Authority Rev., VRDN, 1.26%, 9/1/16 | 550,000 | 550,171 | ||||
Bay Area Toll Authority Rev., VRDN, 1.66%, 9/1/16 | 1,250,000 | 1,263,075 | ||||
Bay Area Toll Authority Rev., VRDN, 1.81%, 9/1/16 | 500,000 | 509,175 | ||||
California Educational Facilities Authority Rev., (Chapman University), 5.00%, 4/1/25 | 285,000 | 360,665 | ||||
California Educational Facilities Authority Rev., (Claremont Mckenna College), 5.00%, 1/1/32 | 750,000 | 947,970 | ||||
California Educational Facilities Authority Rev., (Harvey Mudd College), 5.25%, 12/1/41 | 2,000,000 | 2,376,500 | ||||
California Educational Facilities Authority Rev., (Santa Clara University), 5.625%, 4/1/18, Prerefunded at 100% of Par(2) | 4,675,000 | 5,044,605 | ||||
California Educational Facilities Authority Rev., (Santa Clara University), 5.625%, 4/1/37 | 325,000 | 350,308 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 5.00%, 10/1/36 | 500,000 | 607,350 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 5.00%, 10/1/37 | 500,000 | 606,875 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 5.00%, 10/1/38 | 500,000 | 606,400 | ||||
California Educational Facilities Authority Rev., (University of Southern California), 5.00%, 10/1/39 | 2,000,000 | 2,175,040 | ||||
California Educational Facilities Authority Rev., (University of the Pacific), 5.00%, 11/1/33 | 500,000 | 616,565 | ||||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/22(3) | 1,200,000 | 1,382,220 | ||||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/39(3) | 1,385,000 | 1,528,001 | ||||
California Health Facilities Financing Authority Rev., (Cedars-Sinai Medical Center), 5.00%, 11/15/32 | 400,000 | 500,044 | ||||
California Health Facilities Financing Authority Rev., (Children's Hospital of Orange County), 6.50%, 11/1/38 (GA: Children's Healthcare of California) | 4,500,000 | 5,299,650 |
10
Principal Amount | Value | |||||
California Health Facilities Financing Authority Rev., (Dignity Health Obligated Group), 6.00%, 7/1/39 | $ | 3,400,000 | $ | 3,880,862 | ||
California Health Facilities Financing Authority Rev., (Lucile Salter Packard Children's Hospital at Stanford Obligated Group), 5.00%, 8/15/43 | 1,000,000 | 1,190,460 | ||||
California Health Facilities Financing Authority Rev., (Lucile Salter Packard Children's Hospital at Stanford Obligated Group), VRDN, 1.45%, 3/15/17, Prerefunded at 100% of Par(2) | 150,000 | 150,744 | ||||
California Health Facilities Financing Authority Rev., (Providence Health & Services Obligated Group), 6.50%, 10/1/18, Prerefunded at 100% of Par(2) | 1,000,000 | 1,123,080 | ||||
California Health Facilities Financing Authority Rev., (Providence Health & Services Obligated Group), 5.50%, 10/1/39 | 1,000,000 | 1,139,240 | ||||
California Health Facilities Financing Authority Rev., (Providence St. Joseph Health Obligated Group), 5.00%, 10/1/28(3) | 1,180,000 | 1,532,560 | ||||
California Health Facilities Financing Authority Rev., (Scripps Health Obligated Group), 5.00%, 11/15/19 | 1,000,000 | 1,131,030 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System Obligated Group), 5.00%, 7/1/37 | 180,000 | 214,072 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System Obligated Group), 5.75%, 7/1/39 | 1,000,000 | 1,135,060 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System), VRDN, 0.62%, 9/1/16 (LOC: U.S. Bank N.A.) | 2,500,000 | 2,500,000 | ||||
California Health Facilities Financing Authority Rev., (Stanford Health Care Obligated Group), 5.00%, 8/15/51 | 500,000 | 588,115 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 6.00%, 8/15/42 | 1,500,000 | 1,795,965 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 8/15/43 | 720,000 | 870,041 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 11/15/46 | 2,000,000 | 2,454,940 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.25%, 11/15/46 | 1,500,000 | 1,513,995 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 8/15/52 | 1,500,000 | 1,774,755 | ||||
California Infrastructure & Economic Development Bank Rev., (Academy of Motion Picture Arts and Sciences Obligated Group), 5.00%, 11/1/41 | 740,000 | 889,709 | ||||
California Infrastructure & Economic Development Bank Rev., (Colburn School), VRDN, 1.56%, 9/1/16 | 935,000 | 941,461 | ||||
California Infrastructure & Economic Development Bank Rev., (Museum Associates), VRDN, 2.11%, 9/1/16 | 1,000,000 | 1,020,460 | ||||
California Infrastructure & Economic Development Bank Rev., (Pacific Gas & Electric Co.), VRDN, 0.63%, 9/1/16 (LOC: Union Bank N.A.) | 1,800,000 | 1,800,000 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 5.00%, 2/1/30 (GA: Walt & Lilly Disney Foundation) | 550,000 | 694,204 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 4.00%, 2/1/32 (GA: Walt & Lilly Disney Foundation) | 900,000 | 1,025,595 | ||||
California Municipal Finance Authority Rev., (Azusa Pacific University), 8.00%, 4/1/21, Prerefunded at 100% of Par(2) | 665,000 | 873,378 | ||||
California Municipal Finance Authority Rev., (Azusa Pacific University), 5.00%, 4/1/41 | 500,000 | 580,680 | ||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/40 | 1,420,000 | 1,667,307 | ||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/46 | 1,000,000 | 1,164,330 |
11
Principal Amount | Value | |||||
California Municipal Finance Authority Rev., (Emerson College), 6.00%, 1/1/42 | $ | 2,000,000 | $ | 2,416,240 | ||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 5.00%, 11/1/26 | 790,000 | 978,044 | ||||
California Municipal Finance Authority Rev., (Terwilliger Plaza, Inc.), 5.00%, 6/1/46 | 500,000 | 574,880 | ||||
California Municipal Finance Authority Rev., (Touro College and University System Obligated Group), 5.25%, 1/1/34 | 300,000 | 341,778 | ||||
California Municipal Finance Authority Rev., (Touro College and University System Obligated Group), 5.25%, 1/1/40 | 1,000,000 | 1,131,860 | ||||
California Municipal Finance Authority Rev., (University of La Verne), 6.25%, 6/1/40 | 1,000,000 | 1,161,690 | ||||
California Pollution Control Financing Authority Rev., 5.00%, 11/21/45(4) | 1,000,000 | 1,028,590 | ||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/46(4) | 250,000 | 287,030 | ||||
California State Public Works Board Rev., 5.00%, 9/1/22, Prerefunded at 100% of Par(2) | 500,000 | 615,260 | ||||
California State Public Works Board Rev., 5.00%, 9/1/23, Prerefunded at 100% of Par(2) | 1,865,000 | 2,356,838 | ||||
California State Public Works Board Rev., 5.25%, 12/1/26 | 1,000,000 | 1,204,460 | ||||
California State Public Works Board Rev., 5.75%, 11/1/29 | 1,685,000 | 1,938,879 | ||||
California State Public Works Board Rev., 5.75%, 10/1/30 | 2,000,000 | 2,289,860 | ||||
California State Public Works Board Rev., 5.00%, 4/1/37 | 2,170,000 | 2,553,656 | ||||
California State Public Works Board Rev., 5.00%, 11/1/38 | 1,500,000 | 1,823,595 | ||||
California State University Rev., 5.25%, 5/1/19, Prerefunded at 100% of Par(2) | 2,230,000 | 2,509,486 | ||||
California State University Rev., 5.00%, 11/1/19 | 1,000,000 | 1,135,880 | ||||
California State University Rev., 4.00%, 11/1/45 | 1,005,000 | 1,134,635 | ||||
California Statewide Communities Development Authority Rev., (Adventist Health System/West Obligated Group), 5.00%, 3/1/35 | 715,000 | 879,243 | ||||
California Statewide Communities Development Authority Rev., (American Baptist Homes of the West Obligated Group), 5.00%, 10/1/45 | 600,000 | 703,896 | ||||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 5.00%, 5/15/40 | 1,200,000 | 1,457,076 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/34 | 500,000 | 594,475 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/44 | 1,300,000 | 1,534,429 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.25%, 11/1/30 | 1,000,000 | 1,151,120 | ||||
California Statewide Communities Development Authority Rev., (Henry Mayo Newhall Memorial Hospital), 5.25%, 10/1/43 (AGM) | 750,000 | 901,612 | ||||
California Statewide Communities Development Authority Rev., (Kaiser Credit Group), 5.00%, 4/1/42 | 2,780,000 | 3,242,453 | ||||
California Statewide Communities Development Authority Rev., (Trinity Health Corp. Obligated Group), 5.00%, 12/1/41 | 500,000 | 589,405 | ||||
Carson Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 10/1/19 (AGM) | 485,000 | 545,407 | ||||
Carson Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 10/1/20 (AGM) | 785,000 | 901,141 | ||||
Cathedral City Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 8/1/28 (AGM) | 1,190,000 | 1,451,217 | ||||
City & County of San Francisco COP, 5.00%, 4/1/29 | 1,170,000 | 1,291,504 |
12
Principal Amount | Value | |||||
Contra Costa Water District Rev., 3.00%, 10/1/21(3) | $ | 1,750,000 | $ | 1,925,350 | ||
Del Mar Race Track Authority Rev., 5.00%, 10/1/35 | 660,000 | 749,595 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/24(5) | 700,000 | 626,780 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/33(1) | 750,000 | 415,838 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/42(1) | 1,250,000 | 478,138 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., 6.50%, 1/15/43 | 500,000 | 611,620 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., 5.75%, 1/15/46 | 1,000,000 | 1,198,180 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., 6.00%, 1/15/49 | 3,250,000 | 3,940,722 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., VRDN, 5.50%, 1/15/23 | 1,000,000 | 1,195,010 | ||||
Golden State Tobacco Securitization Corp. Rev., Capital Appreciation, 0.00%, 6/1/25 (AGM)(1) | 1,000,000 | 852,850 | ||||
Golden State Tobacco Securitization Corp. Rev., 4.50%, 6/1/27 | 445,000 | 452,116 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/33 | 750,000 | 757,387 | ||||
Grossmont Union High School District GO, 5.00%, 8/1/43 | 1,000,000 | 1,212,290 | ||||
Hayward Area Recreation and Park District COP, 5.125%, 1/1/39 | 1,000,000 | 1,184,050 | ||||
Inland Valley Development Agency Tax Allocation, 5.25%, 9/1/37 | 555,000 | 664,241 | ||||
Inland Valley Development Agency Tax Allocation, 5.00%, 9/1/44 | 590,000 | 687,675 | ||||
Irvine Rev., VRDN, 0.58%, 9/1/16 (LOC: State Street Bank & Trust Co.) | 800,000 | 800,000 | ||||
Irvine Special Assessment, 4.00%, 9/2/17 | 365,000 | 376,702 | ||||
Irvine Special Assessment, 4.00%, 9/2/18 | 375,000 | 398,070 | ||||
Irvine Special Assessment, 4.00%, 9/2/19 | 600,000 | 653,664 | ||||
Irvine Special Assessment, 5.00%, 9/2/26 | 1,000,000 | 1,279,070 | ||||
Irvine Special Assessment, VRDN, 0.58%, 9/1/16 (LOC: U.S. Bank N.A.) | 900,000 | 900,000 | ||||
Irvine Special Tax, 5.00%, 9/1/49 | 1,000,000 | 1,146,760 | ||||
Kaweah Delta Health Care District Rev., 4.00%, 6/1/45 | 1,250,000 | 1,339,062 | ||||
La Verne COP, (Brethren Hillcrest Homes), 5.00%, 5/15/29 | 635,000 | 723,925 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/39 (AGM) | 1,850,000 | 2,246,695 | ||||
Long Beach Bond Finance Authority Rev., 5.00%, 11/15/35 (GA: Merrill Lynch & Co.) | 330,000 | 432,062 | ||||
Long Beach Bond Finance Authority Rev., 5.50%, 11/15/37 (GA: Merrill Lynch & Co.) | 695,000 | 954,110 | ||||
Long Beach Marina System Rev., 5.00%, 5/15/40 | 1,250,000 | 1,452,712 | ||||
Los Alamitos Unified School District COP, Capital Appreciation, 0.00%, 8/1/24(5) | 1,100,000 | 1,002,551 | ||||
Los Angeles Community College District GO, 5.00%, 8/1/17, Prerefunded at 100% of Par (NATL)(2) | 1,425,000 | 1,484,280 | ||||
Los Angeles Community College District GO, 2.00%, 8/1/22 | 450,000 | 476,591 | ||||
Los Angeles County Regional Financing Authority Rev., (MonteCedro, Inc.), 3.00%, 11/15/21 (California Mortgage Insurance) | 245,000 | 245,480 | ||||
Los Angeles County Sanitation Districts Financing Authority Rev., 5.00%, 10/1/35 | 1,500,000 | 1,852,410 | ||||
Los Angeles Department of Airports Rev., 5.25%, 5/15/18, Prerefunded at 100% of Par(2) | 2,120,000 | 2,288,434 |
13
Principal Amount | Value | |||||
Los Angeles Department of Airports Rev., 5.00%, 5/15/40 | $ | 1,000,000 | $ | 1,136,890 | ||
Los Angeles Department of Airports Rev., 5.00%, 5/15/40 | 2,000,000 | 2,270,660 | ||||
Los Angeles Department of Water & Power Rev., 5.00%, 7/1/19 | 1,000,000 | 1,122,520 | ||||
Los Angeles Department of Water & Power Rev., 5.25%, 7/1/38 | 4,000,000 | 4,324,440 | ||||
Los Angeles Department of Water & Power Rev., VRDN, 0.54%, 9/1/16 (SBBPA: Citibank N.A.) | 2,900,000 | 2,900,000 | ||||
Los Angeles Department of Water & Power Rev., VRDN, 0.54%, 9/1/16 (SBBPA: Citibank N.A.) | 5,000,000 | 5,000,000 | ||||
Los Angeles Unified School District GO, 4.00%, 7/1/17 | 1,000,000 | 1,029,570 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/17, Prerefunded at 100% of Par (AGM)(2) | 1,020,000 | 1,058,597 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/18 | 1,280,000 | 1,384,243 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/18 | 2,000,000 | 2,162,880 | ||||
Los Angeles Unified School District GO, 5.25%, 7/1/26 | 1,000,000 | 1,156,980 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/29 | 2,000,000 | 2,238,740 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/30 | 690,000 | 861,486 | ||||
M-S-R Energy Authority Rev., 7.00%, 11/1/34 (GA: Citigroup, Inc.) | 1,000,000 | 1,533,080 | ||||
M-S-R Energy Authority Rev., 7.00%, 11/1/34 (GA: Citigroup, Inc.) | 880,000 | 1,349,110 | ||||
M-S-R Energy Authority Rev., 6.50%, 11/1/39 (GA: Citigroup, Inc.) | 425,000 | 634,138 | ||||
Manhattan Beach Unified School District GO, Capital Appreciation, 0.00%, 9/1/29(1) | 5,905,000 | 4,251,423 | ||||
Modesto Irrigation District COP, 5.75%, 10/1/34 | 2,500,000 | 2,795,100 | ||||
Mount San Antonio Community College District GO, 5.00%, 8/1/34 | 1,000,000 | 1,220,310 | ||||
Municipal Improvement Corp. of Los Angeles Rev., 4.00%, 11/1/34 | 600,000 | 677,466 | ||||
Municipal Improvement Corp. of Los Angeles Rev., 4.00%, 11/1/35 | 750,000 | 841,117 | ||||
New Haven Unified School District GO, 12.00%, 8/1/18 (AGM) | 880,000 | 1,069,077 | ||||
New Haven Unified School District GO, 5.00%, 8/1/45 | 1,500,000 | 1,831,560 | ||||
Newport Beach Rev., (Hoag Memorial Hospital/Newport Healthcare Obligated Group), 6.00%, 12/1/21, Prerefunded at 100% of Par(2) | 1,000,000 | 1,259,850 | ||||
North Lake Tahoe Public Financing Authority Rev., 5.00%, 12/1/21 | 500,000 | 601,795 | ||||
Oakland Unified School District/Alameda County GO, 5.50%, 8/1/32 | 1,000,000 | 1,219,270 | ||||
Oakland Unified School District/Alameda County GO, 6.625%, 8/1/38 | 460,000 | 579,968 | ||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/40 | 450,000 | 548,249 | ||||
Ontario Public Financing Authority Rev., 5.00%, 7/1/43 | 1,000,000 | 1,209,870 | ||||
Orange County Community Facilities District Special Tax, 5.00%, 8/15/35 | 1,000,000 | 1,186,150 | ||||
Orange County Sanitation District Rev., 4.00%, 11/15/16 | 2,000,000 | 2,012,000 | ||||
Orange County Transportation Authority Rev., 5.00%, 8/15/25 | 1,000,000 | 1,238,570 | ||||
Oxnard Financing Authority Rev., 5.00%, 6/1/32 (AGM) | 1,500,000 | 1,810,770 | ||||
Oxnard Financing Authority Rev., 5.00%, 6/1/33 (AGM) | 1,000,000 | 1,203,210 | ||||
Oxnard School District GO, 3.00%, 8/1/40 (AGM)(5) | 700,000 | 749,616 | ||||
Palomar Health COP, 6.75%, 11/1/39 | 500,000 | 558,780 | ||||
Palomar Health COP, 6.00%, 11/1/41 | 750,000 | 807,150 | ||||
Palomar Health GO, Capital Appreciation, 0.00%, 8/1/19 (AGC)(5) | 1,670,000 | 2,059,310 | ||||
Palos Verdes Peninsula Unified School District GO, 0.00%, 8/1/33(1) | 2,600,000 | 1,685,138 | ||||
Paramount Unified School District GO, Capital Appreciation, 0.00%, 8/1/51 (BAM)(1) | 7,500,000 | 870,225 | ||||
Pomona Public Financing Authority Rev., 4.00%, 6/1/36 (AGM)(3) | 1,045,000 | 1,170,985 | ||||
Pomona Unified School District GO, 6.55%, 8/1/29 (NATL) | 1,000,000 | 1,370,660 |
14
Principal Amount | Value | |||||
Pomona Unified School District GO, 6.15%, 8/1/30 (NATL) | $ | 855,000 | $ | 1,065,963 | ||
Port of Los Angeles Rev., 5.00%, 8/1/27 | 500,000 | 560,125 | ||||
Porterville Public Financing Authority Rev., 5.625%, 10/1/36 | 1,500,000 | 1,800,105 | ||||
Poway Unified School District GO, Capital Appreciation, 0.00%, 8/1/41(1) | 2,110,000 | 982,564 | ||||
Poway Unified School District Rev., 7.875%, 9/15/39 | 1,010,000 | 1,178,286 | ||||
Riverside County Asset Leasing Corp. Rev., 5.00%, 11/1/43 | 1,000,000 | 1,168,790 | ||||
Riverside County Redevelopment Successor Agency Tax Allocation, 6.50%, 10/1/40 | 625,000 | 750,994 | ||||
Riverside County Transportation Commission Rev., Capital Appreciation, 0.00%, 6/1/31(1) | 1,555,000 | 893,114 | ||||
Riverside Sewer Rev., 5.00%, 8/1/40 | 500,000 | 603,785 | ||||
Sacramento County Airport System Rev., 5.625%, 7/1/29 | 1,000,000 | 1,086,380 | ||||
Sacramento County Sanitation Districts Financing Authority Rev., VRN, 0.98%, 9/1/16 (NATL) | 1,500,000 | 1,424,025 | ||||
Sacramento Municipal Utility District Rev., 5.00%, 8/15/28 | 1,050,000 | 1,413,846 | ||||
Sacramento Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 12/1/34 (BAM) | 385,000 | 465,450 | ||||
Saddleback Valley Unified School District Public Financing Authority Special Tax, 6.00%, 9/1/16 (AGM) | 1,000,000 | 1,000,000 | ||||
San Bernardino Community College District GO, Capital Appreciation, 0.00%, 8/1/19(5) | 7,400,000 | 8,276,826 | ||||
San Buenaventura Rev., (Community Memorial Health System), 7.50%, 12/1/41 | 1,350,000 | 1,680,480 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/25 | 275,000 | 353,018 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/26 | 850,000 | 1,083,682 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/30 | 225,000 | 280,526 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/40 | 1,500,000 | 1,701,735 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/43 | 1,000,000 | 1,168,420 | ||||
San Diego Public Facilities Financing Authority Rev., 5.00%, 10/15/44 | 1,300,000 | 1,593,306 | ||||
San Diego Public Facilities Financing Authority Sewer Rev., 5.25%, 5/15/19, Prerefunded at 100% of Par(2) | 2,000,000 | 2,249,200 | ||||
San Diego Public Facilities Financing Authority Water Rev., 5.00%, 8/1/30 | 2,000,000 | 2,427,600 | ||||
San Diego Unified Port District Rev., 5.00%, 9/1/24 | 500,000 | 613,260 | ||||
San Diego Unified School District GO, Capital Appreciation, 0.00%, 7/1/44(1) | 2,880,000 | 1,188,634 | ||||
San Diego Unified School District GO, Capital Appreciation, 0.00%, 7/1/49(1) | 1,000,000 | 346,410 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.25%, 5/1/23 | 3,000,000 | 3,354,330 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.00%, 5/1/40 | 2,150,000 | 2,430,897 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 6.625%, 2/1/21, Prerefunded at 100% of Par(2) | 500,000 | 625,800 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/31 | 400,000 | 479,996 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/43 | 500,000 | 588,875 | ||||
San Francisco Public Utilities Commission Water Rev., 5.00%, 11/1/41 | 1,000,000 | 1,174,810 |
15
Principal Amount | Value | |||||
San Francisco Public Utilities Commission Water Rev., 5.00%, 11/1/45 | $ | 1,000,000 | $ | 1,214,530 | ||
San Joaquin Hills Transportation Corridor Agency Rev., 5.00%, 1/15/34 | 1,000,000 | 1,175,380 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., 5.00%, 1/15/44 | 1,000,000 | 1,167,210 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., 5.25%, 1/15/44 | 1,000,000 | 1,129,110 | ||||
San Mateo Special Tax, 5.875%, 9/1/32 | 685,000 | 809,923 | ||||
San Mateo Special Tax, 5.50%, 9/1/44 | 750,000 | 856,380 | ||||
Santa Clara Electric Rev., 5.00%, 7/1/30 | 500,000 | 583,065 | ||||
Santa Cruz County Redevelopment Agency Tax Allocation, 5.00%, 9/1/35 (AGM) | 1,500,000 | 1,831,650 | ||||
Santa Monica Redevelopment Agency Tax Allocation, 5.00%, 7/1/42 | 400,000 | 464,016 | ||||
Santa Monica Redevelopment Agency Tax Allocation, 5.875%, 7/1/42 | 400,000 | 481,080 | ||||
Santa Rosa Wastewater Rev., Capital Appreciation, 0.00%, 9/1/24 (Ambac)(1) | 2,000,000 | 1,732,180 | ||||
Silicon Valley Clean Water Rev., 5.00%, 8/1/45 | 1,205,000 | 1,484,488 | ||||
Sonoma Community Development Agency Successor Agency Tax Allocation, 5.00%, 6/1/33 (NATL) | 1,325,000 | 1,634,520 | ||||
South Placer Wastewater Authority Rev., VRN, 0.89%, 9/1/16 | 1,650,000 | 1,643,730 | ||||
Southern California Public Power Authority Rev., 5.00%, 7/1/17 | 1,050,000 | 1,089,322 | ||||
Southwestern Community College District GO, Capital Appreciation, 0.00%, 8/1/46(1) | 5,000,000 | 1,836,550 | ||||
State of California GO, 5.00%, 2/1/27 | 3,000,000 | 3,678,600 | ||||
State of California GO, 5.00%, 2/1/28 | 1,000,000 | 1,223,960 | ||||
State of California GO, 5.00%, 3/1/28 | 2,000,000 | 2,532,980 | ||||
State of California GO, 5.00%, 9/1/30(3) | 2,000,000 | 2,550,100 | ||||
State of California GO, 5.25%, 9/1/32 | 2,000,000 | 2,399,480 | ||||
State of California GO, 6.50%, 4/1/33 | 5,000,000 | 5,738,000 | ||||
State of California GO, 5.00%, 4/1/38 | 2,500,000 | 2,663,625 | ||||
State of California GO, 6.00%, 4/1/38 | 2,500,000 | 2,833,625 | ||||
State of California GO, 6.00%, 11/1/39 | 5,000,000 | 5,807,050 | ||||
State of California GO, 5.50%, 3/1/40 | 3,000,000 | 3,448,650 | ||||
State of California GO, 5.00%, 10/1/41 | 2,000,000 | 2,373,680 | ||||
State of California GO, 5.00%, 8/1/45 | 2,795,000 | 3,474,045 | ||||
State of California GO, VRN, 1.46%, 9/1/16 | 2,000,000 | 2,010,000 | ||||
State of California GO, VRN, 1.56%, 9/1/16 | 800,000 | 806,024 | ||||
State of California GO, VRN, 1.71%, 9/1/16 | 960,000 | 973,651 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/18 | 2,000,000 | 2,147,220 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/21 | 715,000 | 766,845 | ||||
Stockton Public Financing Authority Rev., 5.00%, 9/1/27 (BAM) | 1,000,000 | 1,242,480 | ||||
Stockton Public Financing Authority Rev., 6.25%, 10/1/40 | 750,000 | 948,765 | ||||
Stockton Unified School District GO, 5.00%, 8/1/29 | 3,485,000 | 4,358,167 | ||||
Stockton Unified School District GO, 5.00%, 8/1/31 | 1,000,000 | 1,235,040 | ||||
Stockton Unified School District GO, 5.00%, 8/1/42 (AGM) | 430,000 | 511,872 | ||||
Susanville Public Financing Authority Rev., 6.00%, 6/1/45 | 1,000,000 | 1,107,510 | ||||
Sutter Union High School District GO, Capital Appreciation, 0.00%, 8/1/49 (BAM)(1) | 2,225,000 | 605,534 |
16
Principal Amount | Value | |||||
Sweetwater Union High School District GO, 4.00%, 8/1/42 | $ | 1,205,000 | $ | 1,347,214 | ||
Tobacco Securitization Authority of Southern California Rev., (San Diego County Tobacco Asset Securitization Corp.), 5.00%, 6/1/37 | 500,000 | 500,040 | ||||
Tuolumne Wind Project Authority Rev., 5.625%, 1/1/29 | 1,200,000 | 1,329,732 | ||||
Tustin Unified School District Special Tax, 6.00%, 9/1/40 | 2,000,000 | 2,321,660 | ||||
University of California Rev., 5.00%, 5/15/25 | 1,000,000 | 1,245,570 | ||||
University of California Rev., VRDN, 5.00%, 5/15/23 | 2,000,000 | 2,499,220 | ||||
Ventura County Community College District GO, 5.50%, 8/1/18, Prerefunded at 100% of Par(2) | 3,000,000 | 3,284,340 | ||||
Victor Valley Community College District GO, 4.00%, 8/1/44 | 3,350,000 | 3,785,734 | ||||
West Contra Costa Unified School District GO, 4.00%, 8/1/46 | 1,000,000 | 1,113,290 | ||||
Yosemite Community College District GO, Capital Appreciation, 0.00%, 8/1/38(1) | 3,000,000 | 1,577,310 | ||||
359,861,475 | ||||||
Guam — 0.7% | ||||||
Guam Government Power Authority Rev., 5.50%, 10/1/40 | 2,150,000 | 2,411,290 | ||||
TOTAL INVESTMENT SECURITIES — 101.9% (Cost $319,111,290) | 362,272,765 | |||||
OTHER ASSETS AND LIABILITIES — (1.9)% | (6,690,001) | |||||
TOTAL NET ASSETS — 100.0% | $ | 355,582,764 |
NOTES TO SCHEDULE OF INVESTMENTS | ||
AGC | - | Assured Guaranty Corporation |
AGM | - | Assured Guaranty Municipal Corporation |
BAM | - | Build America Mutual Assurance Company |
COP | - | Certificates of Participation |
GA | - | Guaranty Agreement |
GO | - | General Obligation |
LOC | - | Letter of Credit |
NATL | - | National Public Finance Guarantee Corporation |
SBBPA | - | Standby Bond Purchase Agreement |
VRDN | - | Variable Rate Demand Note. Interest reset date is indicated. Rate shown is effective at the period end. |
VRN | - | Variable Rate Note. Interest reset date is indicated. Rate shown is effective at the period end. |
(1) | Security is a zero-coupon bond. Zero-coupon securities are issued at a substantial discount from their value at maturity. |
(2) | Escrowed to maturity in U.S. government securities or state and local government securities. |
(3) | When-issued security. The issue price and yield are fixed on the date of the commitment, but payment and delivery are scheduled for a future date. |
(4) | Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration, normally to qualified institutional investors. The aggregate value of these securities at the period end was $1,315,620, which represented 0.4% of total net assets. |
(5) | Coupon rate adjusts periodically based upon a predetermined schedule. Interest reset date is indicated. Rate shown is effective at the period end. |
See Notes to Financial Statements.
17
Statement of Assets and Liabilities |
AUGUST 31, 2016 | |||
Assets | |||
Investment securities, at value (cost of $319,111,290) | $ | 362,272,765 | |
Cash | 167,738 | ||
Receivable for capital shares sold | 60,144 | ||
Interest receivable | 3,664,894 | ||
366,165,541 | |||
Liabilities | |||
Payable for investments purchased | 10,067,163 | ||
Payable for capital shares redeemed | 167,600 | ||
Accrued management fees | 139,100 | ||
Distribution and service fees payable | 7,301 | ||
Dividends payable | 201,613 | ||
10,582,777 | |||
Net Assets | $ | 355,582,764 | |
Net Assets Consist of: | |||
Capital paid in | $ | 311,118,908 | |
Undistributed net investment income | 639 | ||
Undistributed net realized gain | 1,301,742 | ||
Net unrealized appreciation | 43,161,475 | ||
$ | 355,582,764 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | ||||
Investor Class | $341,176,406 | 28,012,681 | $12.18 | |||
Institutional Class | $324,613 | 26,653 | $12.18 | |||
A Class | $7,251,127 | 595,471 | $12.18* | |||
C Class | $6,830,618 | 560,775 | $12.18 |
*Maximum offering price $12.75 (net asset value divided by 0.955).
See Notes to Financial Statements.
18
Statement of Operations |
YEAR ENDED AUGUST 31, 2016 | |||
Investment Income (Loss) | |||
Income: | |||
Interest | $ | 13,178,267 | |
Expenses: | |||
Management fees | 1,611,144 | ||
Distribution and service fees: | |||
A Class | 16,532 | ||
C Class | 68,813 | ||
Trustees' fees and expenses | 20,954 | ||
Other expenses | 3,646 | ||
1,721,089 | |||
Net investment income (loss) | 11,457,178 | ||
Realized and Unrealized Gain (Loss) | |||
Net realized gain (loss) on: | |||
Investment transactions | 2,897,910 | ||
Futures contract transactions | 20,910 | ||
2,918,820 | |||
Change in net unrealized appreciation (depreciation) on: | |||
Investments | 11,020,381 | ||
Futures contracts | (16,875 | ) | |
11,003,506 | |||
Net realized and unrealized gain (loss) | 13,922,326 | ||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 25,379,504 |
See Notes to Financial Statements.
19
Statement of Changes in Net Assets |
YEARS ENDED AUGUST 31, 2016 AND AUGUST 31, 2015 | ||||||
Increase (Decrease) in Net Assets | August 31, 2016 | August 31, 2015 | ||||
Operations | ||||||
Net investment income (loss) | $ | 11,457,178 | $ | 11,665,482 | ||
Net realized gain (loss) | 2,918,820 | (319,618 | ) | |||
Change in net unrealized appreciation (depreciation) | 11,003,506 | (1,586,988 | ) | |||
Net increase (decrease) in net assets resulting from operations | 25,379,504 | 9,758,876 | ||||
Distributions to Shareholders | ||||||
From net investment income: | ||||||
Investor Class | (11,082,052 | ) | (11,274,436 | ) | ||
Institutional Class | (11,026 | ) | (9,947 | ) | ||
A Class | (203,292 | ) | (213,905 | ) | ||
C Class | (160,169 | ) | (167,194 | ) | ||
Decrease in net assets from distributions | (11,456,539 | ) | (11,665,482 | ) | ||
Capital Share Transactions | ||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | (1,513,704 | ) | (14,190,101 | ) | ||
Net increase (decrease) in net assets | 12,409,261 | (16,096,707 | ) | |||
Net Assets | ||||||
Beginning of period | 343,173,503 | 359,270,210 | ||||
End of period | $ | 355,582,764 | $ | 343,173,503 | ||
Undistributed net investment income | $ | 639 | $ | — |
See Notes to Financial Statements.
20
Notes to Financial Statements |
AUGUST 31, 2016
1. Organization
American Century California Tax-Free and Municipal Funds (the trust) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Massachusetts business trust. California Long-Term Tax-Free Fund (the fund) is one fund in a series issued by the trust. The fund’s investment objective is to seek safety of principal and high current income that is exempt from federal and California income taxes.
The fund offers the Investor Class, the Institutional Class, the A Class and the C Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge. The share classes differ principally in their respective sales charges and distribution and shareholder servicing expenses and arrangements. The Institutional Class is made available to institutional shareholders or through financial intermediaries whose clients do not require the same level of shareholder and administrative services as shareholders of other classes. As a result, the Institutional Class is charged a lower unified management fee.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Trustees has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Fixed income securities are valued at the evaluated mean as provided by independent pricing services or at the mean of the most recent bid and asked prices as provided by investment dealers. Municipal securities are valued using market models that consider trade data, quotations from dealers and active market makers, relevant yield curve and spread data, creditworthiness, trade data or market information on comparable securities, and other relevant security specific information.
Open-end management investment companies are valued at the reported net asset value per share. Exchange-traded futures contracts are valued at the settlement price as provided by the appropriate clearing corporation.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Trustees or its delegate, in accordance with policies and procedures adopted by the Board of Trustees. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s net asset value per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region.
21
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investments, including, but not limited to, futures contracts and when-issued securities. American Century Investment Management, Inc. (ACIM) (the investment advisor) monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for margin requirements on futures contracts.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income, if any, are declared daily and paid monthly. Distributions from net realized gains, if any, are generally declared and paid annually.
Indemnifications — Under the trust’s organizational documents, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
3. Fees and Transactions with Related Parties
Certain officers and trustees of the trust are also officers and/or directors of American Century Companies, Inc. (ACC). The trust's investment advisor, ACIM, the trust's distributor, American Century Investment Services, Inc. (ACIS), and the trust's transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The trust has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that all expenses of managing and operating the fund, except distribution and service fees, brokerage expenses, taxes, interest, fees and expenses of the independent trustees (including legal counsel fees), and extraordinary expenses, will be paid by ACIM. The fee is computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fee consists of (1) an Investment Category Fee based on the daily net assets of the fund and certain other accounts managed by the investment advisor that are in the same broad investment category as the fund and (2) a Complex Fee based on the assets of all the funds in the American Century Investments family of funds. The rates for the Investment Category Fee range from 0.1625% to 0.2800%. The rates for the Complex Fee range from 0.2500% to 0.3100% for the Investor Class, A Class and C Class. The rates for the Complex Fee range from 0.0500% to 0.1100% for the Institutional Class. The effective annual management fee for each class for the year ended August 31, 2016 was 0.46% for the Investor Class, A Class and C Class and 0.26% for the Institutional Class.
Distribution and Service Fees — The Board of Trustees has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class and C Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and
22
service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the year ended August 31, 2016 are detailed in the Statement of Operations.
Trustees’ Fees and Expenses — The Board of Trustees is responsible for overseeing the investment advisor’s management and operations of the fund. The trustees receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Trustees. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $23,180,438 and $1,700,000, respectively. The interfund transactions had no effect on the Statement of Operations in net realized gain (loss) on investment transactions.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the year ended August 31, 2016 were $93,309,637 and $83,244,571, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows (unlimited number of shares authorized):
Year ended August 31, 2016 | Year ended August 31, 2015 | |||||||||
Shares | Amount | Shares | Amount | |||||||
Investor Class | ||||||||||
Sold | 1,404,677 | $ | 16,819,809 | 1,043,154 | $ | 12,296,446 | ||||
Issued in reinvestment of distributions | 714,860 | 8,550,951 | 721,400 | 8,508,080 | ||||||
Redeemed | (2,240,396 | ) | (26,719,080 | ) | (2,905,163 | ) | (34,174,882 | ) | ||
(120,859 | ) | (1,348,320 | ) | (1,140,609 | ) | (13,370,356 | ) | |||
Institutional Class | ||||||||||
Sold | — | — | 22,124 | 259,950 | ||||||
Issued in reinvestment of distributions | 922 | 11,026 | 843 | 9,947 | ||||||
922 | 11,026 | 22,967 | 269,897 | |||||||
A Class | ||||||||||
Sold | 87,084 | 1,046,515 | 51,183 | 601,935 | ||||||
Issued in reinvestment of distributions | 16,840 | 201,493 | 17,971 | 211,962 | ||||||
Redeemed | (77,356 | ) | (916,499 | ) | (161,544 | ) | (1,910,307 | ) | ||
26,568 | 331,509 | (92,390 | ) | (1,096,410 | ) | |||||
C Class | ||||||||||
Sold | 92,752 | 1,109,415 | 44,530 | 529,113 | ||||||
Issued in reinvestment of distributions | 7,849 | 93,842 | 8,302 | 97,919 | ||||||
Redeemed | (143,704 | ) | (1,711,176 | ) | (52,774 | ) | (620,264 | ) | ||
(43,103 | ) | (507,919 | ) | 58 | 6,768 | |||||
Net increase (decrease) | (136,472 | ) | $ | (1,513,704 | ) | (1,209,974 | ) | $ | (14,190,101 | ) |
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally
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accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
• | Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments. |
• | Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars. |
• | Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions). |
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments. There were no significant transfers between levels during the period.
As of period end, the fund’s investment securities were classified as Level 2. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
7. Derivative Instruments
Interest Rate Risk — The fund is subject to interest rate risk in the normal course of pursuing its investment objectives. The value of bonds generally declines as interest rates rise. A fund may enter into futures contracts based on a bond index or a specific underlying security. A fund may purchase futures contracts to gain exposure to increases in market value or sell futures contracts to protect against a decline in market value. Upon entering into a futures contract, a fund will segregate cash, cash equivalents or other appropriate liquid securities on its records in amounts sufficient to meet requirements. Subsequent payments (variation margin) are made or received daily, in cash, by a fund. The variation margin is equal to the daily change in the contract value and is recorded as unrealized gains and losses. A fund recognizes a realized gain or loss when the futures contract is closed or expires. Net realized and unrealized gains or losses occurring during the holding period of futures contracts are a component of net realized gain (loss) on futures contract transactions and change in net unrealized appreciation (depreciation) on futures contracts, respectively. One of the risks of entering into futures contracts is the possibility that the change in value of the contract may not correlate with the changes in value of the underlying securities. During the period, the fund participated in interest rate risk derivative instruments.
At period end, the fund did not have any derivative instruments disclosed on the Statement of Assets and Liabilities. For the year ended August 31, 2016, the effect of interest rate risk derivative instruments on the Statement of Operations was $20,910 in net realized gain (loss) on futures contract transactions and $(16,875) in change in net unrealized appreciation (depreciation) on futures contracts.
8. Risk Factors
The fund focuses its investments in a single state and therefore may have more exposure to credit risk related to the state of California than a fund with a broader geographical diversification.
9. Federal Tax Information
The tax character of distributions paid during the years ended August 31, 2016 and August 31, 2015 were as follows:
2016 | 2015 | |||||
Distributions Paid From | ||||||
Exempt income | $ | 11,456,539 | $ | 11,664,699 | ||
Taxable ordinary income | — | $ | 783 | |||
Long-term capital gains | — | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
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As of August 31, 2016, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 319,111,290 | |
Gross tax appreciation of investments | $ | 43,168,366 | |
Gross tax depreciation of investments | (6,891 | ) | |
Net tax appreciation (depreciation) of investments | $ | 43,161,475 | |
Undistributed exempt income | $ | 639 | |
Accumulated long-term gains | $ | 1,301,742 |
The cost of investments for federal income tax purposes was the same as the cost for financial reporting purposes.
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Financial Highlights |
For a Share Outstanding Throughout the Years Ended August 31 (except as noted) | |||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Investment Income | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||
Investor Class | |||||||||||||
2016 | $11.70 | 0.40 | 0.48 | 0.88 | (0.40) | $12.18 | 7.62% | 0.47% | 3.33% | 24% | $341,176 | ||
2015 | $11.76 | 0.39 | (0.06) | 0.33 | (0.39) | $11.70 | 2.86% | 0.47% | 3.33% | 31% | $329,152 | ||
2014 | $10.94 | 0.38 | 0.82 | 1.20 | (0.38) | $11.76 | 11.10% | 0.47% | 3.32% | 46% | $344,356 | ||
2013 | $11.70 | 0.37 | (0.76) | (0.39) | (0.37) | $10.94 | (3.45)% | 0.47% | 3.19% | 44% | $346,396 | ||
2012 | $10.94 | 0.41 | 0.77 | 1.18 | (0.42) | $11.70 | 10.92% | 0.47% | 3.65% | 76% | $412,713 | ||
Institutional Class | |||||||||||||
2016 | $11.70 | 0.42 | 0.48 | 0.90 | (0.42) | $12.18 | 7.83% | 0.27% | 3.53% | 24% | $325 | ||
2015 | $11.77 | 0.42 | (0.07) | 0.35 | (0.42) | $11.70 | 2.97% | 0.27% | 3.53% | 31% | $301 | ||
2014 | $10.94 | 0.40 | 0.83 | 1.23 | (0.40) | $11.77 | 11.42% | 0.27% | 3.52% | 46% | $33 | ||
2013 | $11.70 | 0.40 | (0.76) | (0.36) | (0.40) | $10.94 | (3.26)% | 0.27% | 3.39% | 44% | $29 | ||
2012 | $10.94 | 0.44 | 0.76 | 1.20 | (0.44) | $11.70 | 11.14% | 0.27% | 3.85% | 76% | $30 | ||
A Class | |||||||||||||
2016 | $11.70 | 0.37 | 0.48 | 0.85 | (0.37) | $12.18 | 7.35% | 0.72% | 3.08% | 24% | $7,251 | ||
2015 | $11.76 | 0.36 | (0.06) | 0.30 | (0.36) | $11.70 | 2.60% | 0.72% | 3.08% | 31% | $6,655 | ||
2014 | $10.94 | 0.35 | 0.82 | 1.17 | (0.35) | $11.76 | 10.83% | 0.72% | 3.07% | 46% | $7,778 | ||
2013 | $11.70 | 0.34 | (0.76) | (0.42) | (0.34) | $10.94 | (3.70)% | 0.72% | 2.94% | 44% | $8,572 | ||
2012 | $10.94 | 0.38 | 0.77 | 1.15 | (0.39) | $11.70 | 10.64% | 0.72% | 3.40% | 76% | $16,214 |
For a Share Outstanding Throughout the Years Ended August 31 (except as noted) | |||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Investment Income | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||
C Class | |||||||||||||
2016 | $11.70 | 0.28 | 0.48 | 0.76 | (0.28) | $12.18 | 6.55% | 1.47% | 2.33% | 24% | $6,831 | ||
2015 | $11.76 | 0.28 | (0.06) | 0.22 | (0.28) | $11.70 | 1.83% | 1.47% | 2.33% | 31% | $7,066 | ||
2014 | $10.94 | 0.26 | 0.82 | 1.08 | (0.26) | $11.76 | 10.00% | 1.47% | 2.32% | 46% | $7,104 | ||
2013 | $11.70 | 0.26 | (0.76) | (0.50) | (0.26) | $10.94 | (4.41)% | 1.47% | 2.19% | 44% | $7,471 | ||
2012 | $10.94 | 0.30 | 0.76 | 1.06 | (0.30) | $11.70 | 9.82% | 1.47% | 2.65% | 76% | $11,321 |
Notes to Financial Highlights |
(2) Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized.
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Board of Trustees of the American Century California Tax-Free and Municipal Funds and Shareholders of the California Long-Term Tax-Free Fund:
In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the California Long-Term Tax-Free Fund (one of the four funds in the American Century California Tax-Free and Municipal Funds, hereafter referred to as the "Fund") at August 31, 2016, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at August 31, 2016 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Kansas City, Missouri
October 18, 2016
28
Management |
Board of Trustees
The individuals listed below serve as trustees of the funds. Each trustee will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for trustees who are not “interested persons,” as that term is defined in the Investment Company Act (independent trustees). Independent trustees shall retire on December 31 of the year in which they reach their 75th birthday; provided, however, that on or after January 1, 2022, independent trustees shall retire on December 31 of the year in which they reach their 76th birthday.
Mr. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other trustees (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The trustees serve in this capacity for eight (in the case of Mr. Thomas, 15) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the trustees. The mailing address for each trustee other than Mr. Thomas is 1665 Charleston Road, Mountain View, California 94043. The mailing address for Mr. Thomas is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Trustee | Other Directorships Held During Past 5 Years |
Independent Trustees | |||||
Tanya S. Beder (1955) | Trustee | Since 2011 | Chairman and CEO, SBCC Group Inc. (independent advisory services) (2006 to present) | 44 | CYS Investments, Inc. (NYSE mortgage arbitrage REIT) |
Jeremy I. Bulow (1954) | Trustee | Since 2011 | Professor of Economics, Stanford University, Graduate School of Business (1979 to present) | 44 | None |
Anne Casscells (1958) | Trustee | Since 2016 | Co-Chief Executive Officer and Chief Investment Officer, Aetos Alternatives Management (investment advisory firm) (2001 to present); Lecturer in Accounting, Stanford University, Graduate School of Business (2009 to present) | 44 | None |
29
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Trustee | Other Directorships Held During Past 5 Years |
Independent Trustees | |||||
Ronald J. Gilson (1946) | Trustee and Chairman of the Board | Since 1995 (Chairman since 2005) | Charles J. Meyers Professor of Law and Business, Emeritus, Stanford Law School (1979 to present); Marc and Eva Stern Professor of Law and Business, Columbia University School of Law (1992 to present) | 44 | None |
Frederick L. A. Grauer (1946) | Trustee | Since 2008 | Senior Advisor, iShares by BlackRock, Inc. (investment management firm) (2010 to 2011, 2013 to present); Senior Advisor, Course Hero (an educational technology company) (2015 to present) | 44 | None |
Jonathan D. Levin (1972) | Trustee | Since 2016 | Philip H. Knight Professor and Dean, Graduate School of Business, Stanford University (2016 to present); Professor, Stanford University, (2000 to present); Chair, Department of Economics, Stanford University (2011 to 2014) | 44 | None |
Peter F. Pervere (1947) | Trustee | Since 2007 | Retired | 44 | None |
John B. Shoven (1947) | Trustee | Since 2002 | Charles R. Schwab Professor of Economics, Stanford University (1973 to present) | 44 | Cadence Design Systems; Exponent; Financial Engines |
Interested Trustee | |||||
Jonathan S. Thomas (1963) | Trustee and President | Since 2007 | President and Chief Executive Officer, ACC (March 2007 to present). Also serves as Chief Executive Officer, ACS; Executive Vice President, ACIM; Director, ACC, ACIM and other ACC subsidiaries | 127 | BioMed Valley Discoveries, Inc. |
The Statement of Additional Information has additional information about the fund's trustees and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 15 investment companies in the American Century family of funds, unless otherwise noted. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each of the officers listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years |
Jonathan S. Thomas (1963) | Trustee and President since 2007 | President and Chief Executive Officer, ACC (March 2007 to present). Also serves as Chief Executive Officer, ACS; Executive Vice President, ACIM; Director, ACC, ACIM and other ACC subsidiaries |
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (March 2014 to present); Chief Compliance Officer, ACIM (February 2014 to present); Chief Compliance Officer, ACIS (October 2009 to present); Vice President, Client Interactions and Marketing, ACIS (February 2013 to January 2014); Director, Client Interactions and Marketing, ACIS (June 2007 to January 2013). Also serves as Vice President, ACIS |
Charles A. Etherington (1957) | General Counsel since 2007 and Senior Vice President since 2006 | Attorney, ACC (February 1994 to present); Vice President, ACC (November 2005 to present); General Counsel, ACC (March 2007 to present). Also serves as General Counsel, ACIM, ACS, ACIS and other ACC subsidiaries; and Senior Vice President, ACIM and ACS |
C. Jean Wade (1964) | Vice President, Treasurer and Chief Financial Officer since 2012 | Vice President, ACS (February 2000 to present) |
Robert J. Leach (1966) | Vice President since 2006 and Assistant Treasurer since 2012 | Vice President, ACS (February 2000 to present) |
David H. Reinmiller (1963) | Vice President since 2001 | Attorney, ACC (January 1994 to present); Associate General Counsel, ACC (January 2001 to present). Also serves as Vice President, ACIM and ACS |
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (June 2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 14, 2016, the Fund’s Board of Trustees (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors/trustees, including a majority of the independent Trustees, each year. The Board regards this annual evaluation and renewal as one of its most important responsibilities.
The independent Trustees have memorialized a statement regarding the relationship between their ongoing obligations to oversee and evaluate the performance of the Advisor and their annual consideration of renewal of the management agreement. In that statement, the independent Trustees noted that their assessment of the Advisor’s performance is an ongoing process that takes place over the entire year and is informed by all of the extensive information that the Board and its committees receive and consider over time. This information, together with the additional materials provided specifically in connection with the review, are central to the Board’s assessment of the Advisor’s performance and its determination whether to renew the Fund’s management agreement.
Prior to its consideration of the renewal of the management agreement, the Board requested and reviewed extensive data and analysis relating to the proposed renewal. This information and analysis was compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor included, but was not limited to, the following:
• | the nature, extent, and quality of investment management, shareholder services, and other services provided by the Advisor to the Fund; |
• | the wide range of other programs and services the Advisor provides to the Fund and its shareholders on a routine and non-routine basis; |
• | the investment performance of the Fund, including data comparing the Fund’s performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies; |
• | the cost of owning the Fund compared to the cost of owning similar funds; |
• | the Advisor’s compliance policies, procedures, and regulatory experience; |
• | financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor; |
• | possible economies of scale associated with the Advisor’s management of the Fund and other accounts under its management; |
• | data comparing services provided and charges to other investment management clients of the Advisor; |
• | acquired fund fees and expenses; |
• | payments by the Fund and the Advisor to financial intermediaries whose clients are investors in the Fund; and |
• | any collateral benefits derived by the Advisor from the management of the Fund. |
In keeping with its practice, the Board held two in-person meetings to review and discuss the information provided in response to their request. The independent Trustees also had the benefit of the advice of their independent counsel throughout the process.
32
Factors Considered
The Trustees considered all of the information provided by the Advisor, the independent data providers, and the independent Trustees’ independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Trustees did not identify any single factor as being all-important or controlling and each Trustee may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including the following:
Nature, Extent and Quality of Services - Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that under the management agreement, the Advisor provides or arranges at its own expense a wide variety of services including:
• | constructing and designing the Fund |
• | portfolio research and security selection |
• | initial capitalization/funding |
• | securities trading |
• | Fund administration |
• | custody of Fund assets |
• | daily valuation of the Fund’s portfolio |
• | shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications |
• | legal services (except the independent Trustees’ counsel) |
• | regulatory and portfolio compliance |
• | financial reporting |
• | marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans) |
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management, Shareholder, and Other Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Trustees recognize that the Advisor has an obligation to seek the best execution of fund trades. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Portfolio Committee, regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Trustees also review detailed performance information during the management agreement approval process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-, three-, and five-year periods and slightly below its benchmark for the ten-year period reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
33
Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through various committees of the Board, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction (as measured by external as well as internal sources), technology support, new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. Certain aspects of shareholder and transfer agency service level efficiency and the quality of securities trading activities are measured by independent third party providers and are presented in comparison to other fund groups not managed by the Advisor.
The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund, its overall profitability, and its financial condition. The Trustees have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is appropriately sharing economies of scale through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business to provide shareholders enhanced and expanded services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, the fees and expenses of the Fund’s independent Trustees (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing, and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider and comparing the Fund’s unified fee to the total expense ratio of peer funds. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer universe. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
34
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Trustees also requested and received a description of payments made to intermediaries by the Fund and the Advisor. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. The Board noted that the Advisor’s primary business is managing mutual funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. The Board noted that the Advisor receives proprietary research from broker-dealers that execute fund portfolio transactions. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded, however, that the assets of those other clients are not material to the analysis and, where applicable, may be included with the assets of the Fund to determine breakpoints in the management fee schedule.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Trustees. As a result of this process, the Board, including all of the independent Trustees and assisted by the advice of independent legal counsel, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, concluded that the management agreement between the Fund and the Advisor is fair and reasonable in light of the services provided and should be renewed.
35
Proxy Voting Results |
A special meeting of shareholders was held on June 13, 2016, to vote on the following proposal. The proposal received the required number of votes and was adopted. A summary of voting results is listed below.
To elect four trustees to the Board of Trustees of American Century California Tax-Free and Municipal Funds:
Affirmative | Withhold | ||||||
Tanya S. Beder | $ | 2,491,173,919 | $ | 48,905,981 | |||
Jeremy I. Bulow | $ | 2,490,850,243 | $ | 49,229,657 | |||
Anne Casscells | $ | 2,491,569,613 | $ | 48,510,287 | |||
Jonathan D. Levin | $ | 2,491,165,182 | $ | 48,914,718 |
The other trustees whose term of office continued after the meeting include Jonathan S. Thomas, Ronald J. Gilson, Frederick L. A. Grauer, Peter F. Pervere and John B. Shoven.
36
Additional Information |
Proxy Voting Policies
Descriptions of the principles and policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund are available without charge, upon request, by calling 1-800-345-2021 or visiting the "About Us" page of American Century Investments’ website at americancentury.com. A description of the policies is also available on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the "About Us" page at americancentury.com. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund 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 Forms N-Q are available on the SEC’s website at sec.gov, and may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The fund also makes its complete schedule of portfolio holdings for the most recent quarter of its fiscal year available on its website at americancentury.com and, upon request, by calling 1-800-345-2021.
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund designates $11,469,527 as exempt interest dividends for the fiscal year ended August 31, 2016.
37
Notes |
38
Notes |
39
Notes |
40
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Contact Us | americancentury.com | |
Automated Information Line | 1-800-345-8765 | |
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |
Investors Using Advisors | 1-800-378-9878 | |
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |
Telecommunications Relay Service for the Deaf | 711 | |
American Century California Tax-Free and Municipal Funds | ||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||
©2016 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-90326 1610 |
![acihorizblkb99.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/acihorizblkb99.jpg)
Annual Report | |
August 31, 2016 | |
California Tax-Free Money Market Fund |
Table of Contents |
President’s Letter | ||
Performance | 3 | |
Fund Characteristics | ||
Shareholder Fee Example | ||
Schedule of Investments | ||
Statement of Assets and Liabilities | ||
Statement of Operations | ||
Statement of Changes in Net Assets | ||
Notes to Financial Statements | ||
Financial Highlights | ||
Report of Independent Registered Public Accounting Firm | ||
Management | ||
Approval of Management Agreement | ||
Proxy Voting Results | ||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![jthomasrev0514.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/jthomasrev0514.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended August 31, 2016. It provides investment performance and portfolio information for the reporting period, plus longer-term historical performance data.
Annual reports remain important vehicles for conveying information about fund returns, including market factors that affected performance during the reporting period. For additional, updated investment and market insights, we encourage you to visit our website, americancentury.com.
Municipal Bonds (Munis) Generally Extended Their Solid Performance
Key conditions described in our semiannual report letter extended for another six months. Widespread concerns about global economic growth sparked financial market volatility, followed by monetary policy reactions from central banks. The primary catalyst in 2015 was China, where slowing economic growth and currency devaluations sent shock waves through the global markets. These factors re-emerged in January and early February 2016, triggering sell-offs in riskier assets such as stocks and high-yield bonds and encouraging central banks in Japan and Europe to cut interest rates and/or extend their bond-buying (quantitative easing, QE) programs. More QE came after Brexit, the U.K.’s vote to exit the European Union. Monetary policy expansion produced negative interest rates in Japan and Europe, and lowered longer-maturity bond yields globally.
In this bond-friendly environment, munis generally continued to perform well. The broad muni market benefited from its comparatively high overall credit quality, despite defaults in Puerto Rico and financial concerns facing Illinois and New Jersey. We continue to view these as isolated incidents running counter to overall muni credit quality trends. Also, as government bond yields fell globally, after-tax muni yields looked attractive, especially for investors in top tax brackets.
After 12 straight months of positive performance for the broad muni market, we’re positioning muni portfolios for increased volatility (and the possibility of lower returns) after heavy demand compressed the yield differences (spreads) between shorter- and longer-maturity bonds, and higher- and lower-quality bonds. Spreads narrowed to an extent in August 2016 that would indicate a greater chance of widening than narrowing, given the uncertainties ahead, including central bank reviews of their QE programs, the Federal Reserve’s desire to raise interest rates, the fallout from Brexit, and the U.S. presidential election. We appreciate your continued trust in us during this challenging period.
Sincerely,
![image48a01.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/image48a01.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
2
Performance |
Total Returns as of August 31, 2016 | |||||
Average Annual Returns | |||||
Ticker Symbol | 1 year | 5 years | 10 years | Inception Date | |
Investor Class | BCTXX | 0.02% | 0.01% | 0.64% | 11/9/83 |
Returns would have been lower if a portion of the fees had not been waived.
Total Annual Fund Operating Expenses |
Investor Class 0.50% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown.
Total returns for periods less than one year are not annualized. To obtain performance
data current to the most recent month end, please call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
You could lose money by investing in the fund. Although the fund seeks to preserve the value of your investment at $1.00 per share, it cannot guarantee it will do so. The fund may impose a fee upon sale of your shares or may temporarily suspend your ability to sell shares if the fund’s liquidity falls below required minimums because of market conditions or other factors. An investment in the fund is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. The fund’s sponsor has no legal obligation to provide financial support to the fund, and you should not expect that the sponsor will provide financial support to the fund at any time.
The 7-day current yield more closely reflects the current earnings of the fund than the total return.
3
Fund Characteristics |
AUGUST 31, 2016 | |
Yields | |
7-Day Current Yield | 0.16% |
7-Day Effective Yield | 0.16% |
Portfolio at a Glance | |
Weighted Average Maturity | 39 days |
Weighted Average Life | 79 days |
Portfolio Composition by Maturity | % of fund investments |
1-30 days | 85% |
31-90 days | 4% |
91-180 days | 1% |
More than 180 days | 10% |
4
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from March 1, 2016 to August 31, 2016.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or Institutional Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not a financial intermediary or retirement plan account), American Century Investments may charge you a $12.50 semiannual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $12.50 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments Brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments Brokerage accounts, you are currently not subject to this fee. If you are subject to the Account Maintenance Fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
5
Beginning Account Value 3/1/16 | Ending Account Value 8/31/16 | Expenses Paid During Period(1) 3/1/16 - 8/31/16 | Annualized Expense Ratio(1) | |
Actual | ||||
Investor Class (after waiver) | $1,000 | $1,000.20 | $2.26 | 0.45% |
Investor Class (before waiver) | $1,000 | $1,000.20(2) | $2.51 | 0.50% |
Hypothetical | ||||
Investor Class (after waiver) | $1,000 | $1,022.87 | $2.29 | 0.45% |
Investor Class (before waiver) | $1,000 | $1,022.62 | $2.54 | 0.50% |
(1) | Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 184, the number of days in the most recent fiscal half-year, divided by 366, to reflect the one-half year period. |
(2) | Ending account value assumes the return earned after waiver and would have been lower if a portion of the fees had not been waived. |
6
Schedule of Investments |
AUGUST 31, 2016
Principal Amount | Value | |||||
MUNICIPAL SECURITIES — 99.2% | ||||||
California — 99.2% | ||||||
California Enterprise Development Authority Rev., (Community Hospice, Inc.), VRDN, 0.59%, 9/1/16 (LOC: Bank of Stockton and FHLB) | $ | 3,395,000 | $ | 3,395,000 | ||
California Enterprise Development Authority Rev., (Humane Society Silicon Valley), VRDN, 0.59%, 9/1/16 (LOC: First Republic Bank and FHLB) | 6,080,000 | 6,080,000 | ||||
California Infrastructure & Economic Development Bank Rev., (Bay Institute Aquarium Foundation), VRDN, 0.63%, 9/1/16 (LOC: MUFG Union Bank N.A. and FHLB) | 1,060,000 | 1,060,000 | ||||
California Infrastructure & Economic Development Bank Rev., (Catalina Island Museum), VRDN, 0.66%, 9/1/16 (LOC: Bank of the West) | 960,000 | 960,000 | ||||
California Infrastructure & Economic Development Bank Rev., (Columbia College), VRDN, 0.59%, 9/1/16 (LOC: Rabobank N.A. and Rabobank Nederland) | 4,685,000 | 4,685,000 | ||||
California Infrastructure & Economic Development Bank Rev., (South Malt Avenue Corp.), VRDN, 0.61%, 9/1/16 (LOC: City National Bank and FHLB) | 1,335,000 | 1,335,000 | ||||
California Infrastructure & Economic Development Bank Rev., VRDN, 0.62%, 9/1/16 (LOC: MUFG Union Bank N.A.) | 2,030,000 | 2,030,000 | ||||
California Municipal Finance Authority Rev., (Central Coast YMCA), VRDN, 0.58%, 9/1/16 (LOC: Pacific Capital Bank N.A. and FHLB) | 4,710,000 | 4,710,000 | ||||
California Municipal Finance Authority Rev., (High Desert Partnership In Academic Excellence Foundation, Inc.), VRDN, 0.62%, 9/1/16 (LOC: MUFG Union Bank N.A.) | 2,000,000 | 2,000,000 | ||||
California State University Rev., 5.00%, 11/1/16 | 750,000 | 755,783 | ||||
California Statewide Communities Development Authority Rev., (Goodwill Industries of Santa Cruz Monterey and San Luis Obispo Counties), VRDN, 0.62%, 9/1/16 (LOC: Wells Fargo Bank N.A.) | 2,200,000 | 2,200,000 | ||||
California Statewide Communities Development Authority Rev., (Marvin & Bebe L Zigman), VRDN, 0.63%, 9/1/16 (LOC: Wells Fargo Bank N.A.) | 1,800,000 | 1,800,000 | ||||
Eastern Municipal Water District Rev., VRN, 0.65%, 9/1/16 | 5,000,000 | 5,000,000 | ||||
Eastern Municipal Water District Rev., VRN, 0.73%, 9/1/16 | 5,500,000 | 5,500,000 | ||||
Elsinore Valley Municipal Water District COP, VRDN, 0.62%, 9/7/16 (LOC: Bank of America N.A.) | 2,000,000 | 2,000,000 | ||||
Hesperia Public Financing Authority Rev., VRDN, 0.82%, 9/7/16 (LOC: Bank of the West) | 605,000 | 605,000 | ||||
Irvine Special Assessment, VRDN, 0.58%, 9/1/16 (LOC: U.S. Bank N.A.)(1) | 3,000,000 | 3,000,000 | ||||
Irvine Ranch Water District Special Assessment, VRN, 0.64%, 9/1/16 | 6,000,000 | 6,000,000 | ||||
Irvine Ranch Water District Special Assessment, VRN, 0.64%, 9/1/16 | 2,500,000 | 2,500,000 | ||||
Los Angeles GO, 3.00%, 6/29/17 | 1,500,000 | 1,528,494 | ||||
Los Angeles County GO, 3.00%, 6/30/17 | 3,000,000 | 3,057,446 | ||||
Metropolitan Water District of Southern California Rev., VRN, 0.64%, 9/1/16 | 5,000,000 | 5,000,000 | ||||
Metropolitan Water District of Southern California Rev., VRN, 0.72%, 9/1/16 | 2,000,000 | 2,000,000 |
7
Principal Amount | Value | |||||
Metropolitan Water District of Southern California Rev., VRN, 0.72%, 9/1/16 | $ | 2,300,000 | $ | 2,300,000 | ||
Monterey Peninsula Water Management District COP, VRDN, 0.62%, 9/1/16 (LOC: Wells Fargo Bank N.A.) | 2,370,000 | 2,370,000 | ||||
Pittsburg Public Financing Authority Rev., VRDN, 0.63%, 9/1/16 (LOC: Bank of the West) | 6,090,000 | 6,090,000 | ||||
Reedley COP, (Mennonite Brethren Homes, Inc.), VRDN, 0.66%, 9/1/16 (LOC: Bank of the Sierra and FHLB) | 6,480,000 | 6,480,000 | ||||
Riverside County GO, 3.00%, 6/30/17 | 4,000,000 | 4,076,230 | ||||
Riverside County Rev., 2.00%, 10/12/16 | 5,000,000 | 5,009,490 | ||||
Riverside Water Rev. VRN, 0.71%, 9/1/16 | 8,720,000 | 8,720,000 | ||||
Sacramento County Sanitation Districts Financing Authority Rev., VRDN, 0.62%, 9/7/16 (LOC: Bank of America N.A.) | 1,000,000 | 1,000,000 | ||||
San Bernardino County Flood Control District Rev., VRDN, 0.60%, 9/1/16 (LOC: Bank of America N.A.) | 3,000,000 | 3,000,000 | ||||
San County Bernardino GO, 2.00%, 6/30/17 | 5,000,000 | 5,055,463 | ||||
San Diego County Water Authority Financing Corp., 0.48%, 9/21/16 | 5,000,000 | 5,000,000 | ||||
San Diego Unified School District GO, 2.00%, 6/30/17 | 3,000,000 | 3,035,011 | ||||
Santa Clara County Housing Authority Rev., (SR Fountains LP), VRDN, 0.63%, 9/1/16 (LOC: Citibank N.A.) | 930,000 | 930,000 | ||||
State of California GO, 5.00%, 2/1/17 | 2,000,000 | 2,037,342 | ||||
Tender Option Bond Trust Receipts/Certificates Rev., VRDN, 0.64%, 9/1/16 (AGM)(LIQ FAC: JPMorgan Chase Bank N.A.)(1) | 6,590,000 | 6,590,000 | ||||
Tender Option Bond Trust Receipts/Certificates Rev., VRDN, 0.66%, 9/1/16 (LIQ FAC: JPMorgan Chase Bank N.A.)(1) | 5,245,000 | 5,245,000 | ||||
Tender Option Bond Trust Receipts/Certificates Rev., VRDN, 0.68%, 9/1/16 (LIQ FAC: JPMorgan Chase Bank N.A.)(1) | 3,750,000 | 3,750,000 | ||||
Tender Option Bond Trust Receipts/Certificates Rev., VRDN, 0.63%, 9/15/16 (LIQ FAC: Bank of America N.A.)(1) | 5,000,000 | 5,000,000 | ||||
Town of Apple Valley COP, VRDN, 0.62%, 9/1/16 (LOC: MUFG Union Bank N.A.) | 1,125,000 | 1,125,000 | ||||
Town of Hillsborough COP, VRDN, 0.64%, 9/1/16 (SBBPA: Bank of the West) | 4,380,000 | 4,380,000 | ||||
Victorville Joint Powers Finance Authority Rev., VRDN, 1.21%, 9/1/16 (LOC: BNP Paribas) | 12,475,000 | 12,475,000 | ||||
Yolo County Rev., (Beckett Hall, Inc.), VRDN, 0.86%, 9/1/16 (LOC: Bank of the West) | 7,410,000 | 7,410,000 | ||||
TOTAL INVESTMENT SECURITIES — 99.2% | 168,280,259 | |||||
OTHER ASSETS AND LIABILITIES — 0.8% | 1,359,846 | |||||
TOTAL NET ASSETS — 100.0% | $ | 169,640,105 |
8
NOTES TO SCHEDULE OF INVESTMENTS | ||
AGM | - | Assured Guaranty Municipal Corporation |
COP | - | Certificates of Participation |
FHLB | - | Federal Home Loan Bank |
GO | - | General Obligation |
LIQ FAC | - | Liquidity Facilities |
LOC | - | Letter of Credit |
SBBPA | - | Standby Bond Purchase Agreement |
VRDN | - | Variable Rate Demand Note. Interest reset date is indicated. Rate shown is effective at the period end. |
VRN | - | Variable Rate Note. Interest reset date is indicated. Rate shown is effective at the period end. |
(1) | Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration, normally to qualified institutional investors. The aggregate value of these securities at the period end was $23,585,000, which represented 13.9% of total net assets. |
See Notes to Financial Statements.
9
Statement of Assets and Liabilities |
AUGUST 31, 2016 | |||
Assets | |||
Investment securities, at value (amortized cost and cost for federal income tax purposes) | $ | 168,280,259 | |
Cash | 662,388 | ||
Receivable for investments sold | 485,000 | ||
Receivable for capital shares sold | 121,158 | ||
Interest receivable | 269,511 | ||
169,818,316 | |||
Liabilities | |||
Payable for capital shares redeemed | 106,734 | ||
Accrued management fees | 71,297 | ||
Dividends payable | 180 | ||
178,211 | |||
Net Assets | $ | 169,640,105 | |
Investor Class Capital Shares | |||
Shares outstanding (unlimited number of shares authorized) | 169,615,540 | ||
Net Asset Value Per Share | $ | 1.00 | |
Net Assets Consist of: | |||
Capital paid in | $ | 169,615,546 | |
Undistributed net realized gain | 24,559 | ||
$ | 169,640,105 |
See Notes to Financial Statements.
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Statement of Operations |
YEAR ENDED AUGUST 31, 2016 | |||
Investment Income (Loss) | |||
Income: | |||
Interest | $ | 567,291 | |
Expenses: | |||
Management fees | 914,634 | ||
Trustees' fees and expenses | 10,527 | ||
Other expenses | 2,590 | ||
927,751 | |||
Fees waived | (397,281 | ) | |
530,470 | |||
Net investment income (loss) | 36,821 | ||
Net realized gain (loss) on investment transactions | 24,575 | ||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 61,396 |
See Notes to Financial Statements.
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Statement of Changes in Net Assets |
YEARS ENDED AUGUST 31, 2016 AND AUGUST 31, 2015 | ||||||
Increase (Decrease) in Net Assets | August 31, 2016 | August 31, 2015 | ||||
Operations | ||||||
Net investment income (loss) | $ | 36,821 | $ | 20,678 | ||
Net realized gain (loss) | 24,575 | 2,697 | ||||
Net increase (decrease) in net assets resulting from operations | 61,396 | 23,375 | ||||
Distributions to Shareholders | ||||||
From net investment income | (36,821 | ) | (20,678 | ) | ||
From net realized gains | (720 | ) | — | |||
Decrease in net assets from distributions | (37,541 | ) | (20,678 | ) | ||
Capital Share Transactions | ||||||
Proceeds from shares sold | 47,343,902 | 56,838,279 | ||||
Proceeds from reinvestment of distributions | 36,856 | 20,265 | ||||
Payments for shares redeemed | (77,408,015 | ) | (78,259,625 | ) | ||
Net increase (decrease) in net assets from capital share transactions | (30,027,257 | ) | (21,401,081 | ) | ||
Net increase (decrease) in net assets | (30,003,402 | ) | (21,398,384 | ) | ||
Net Assets | ||||||
Beginning of period | 199,643,507 | 221,041,891 | ||||
End of period | $ | 169,640,105 | $ | 199,643,507 | ||
Transactions in Shares of the Fund | ||||||
Sold | 47,343,902 | 56,838,279 | ||||
Issued in reinvestment of distributions | 36,856 | 20,265 | ||||
Redeemed | (77,408,015 | ) | (78,259,625 | ) | ||
Net increase (decrease) in shares of the fund | (30,027,257 | ) | (21,401,081 | ) |
See Notes to Financial Statements.
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Notes to Financial Statements |
AUGUST 31, 2016
1. Organization
American Century California Tax-Free and Municipal Funds (the trust) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Massachusetts business trust. California Tax-Free Money Market Fund (the fund) is one fund in a series issued by the trust. The fund’s investment objective is to seek safety of principal and high current income that is exempt from federal and California income taxes.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value (NAV) per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. Investments are generally valued at amortized cost, which approximates fair value. Open-end management investment companies are valued at the reported NAV per share. If the fund determines that the valuation methods do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Trustees or its delegate, in accordance with policies and procedures adopted by the Board of Trustees.
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Distributions to Shareholders — Distributions from net investment income, if any, are declared daily and paid monthly. The fund may make capital gains distributions to comply with the distribution requirements of the Internal Revenue Code.
Indemnifications — Under the trust’s organizational documents, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
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3. Fees and Transactions with Related Parties
Certain officers and trustees of the trust are also officers and/or directors of American Century Companies, Inc. (ACC). The trust's investment advisor, American Century Investment Management, Inc. (ACIM), the trust's distributor, American Century Investment Services, Inc., and the trust's transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The trust has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee). The agreement provides that all expenses of managing and operating the fund, except distribution and service fees, brokerage expenses, taxes, interest, fees and expenses of the independent trustees (including legal counsel fees), and extraordinary expenses, will be paid by ACIM. The fee is computed and accrued daily based on the daily net assets of the fund and paid monthly in arrears. The fee consists of (1) an Investment Category Fee based on the daily net assets of the fund and certain other accounts managed by the investment advisor that are in the same broad investment category as the fund and (2) a Complex Fee based on the assets of all the funds in the American Century Investments family of funds. The rates for the Investment Category Fee range from 0.1570% to 0.2700%. The rates for the Complex Fee range from 0.2500% to 0.3100%. In order to maintain a positive yield, ACIM may voluntarily waive a portion of the management fee on a daily basis. The fee waiver may be revised or terminated at any time by the investment advisor without notice. The effective annual management fee for the year ended August 31, 2016 was 0.49% before waiver and 0.28% after waiver.
Trustees’ Fees and Expenses — The Board of Trustees is responsible for overseeing the investment advisor’s management and operations of the fund. The trustees receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Trustees. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $11,840,000 and $38,565,000, respectively. The interfund transactions had no effect on the Statement of Operations in net realized gain (loss) on investment transactions.
4. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
• | Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments. |
• | Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars. |
• | Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions). |
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments. There were no significant transfers between levels during the period.
As of period end, the fund’s investment securities were classified as Level 2. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
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5. Risk Factors
The fund focuses its investments in a single state and therefore may have more exposure to credit risk related to the state of California than a fund with a broader geographical diversification.
6. Federal Tax Information
The tax character of distributions paid during the years ended August 31, 2016 and August 31, 2015 were as follows:
2016 | 2015 | |||||
Distributions Paid From | ||||||
Exempt income | $ | 36,837 | $ | 20,678 | ||
Long-term capital gains | $ | 704 | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of August 31, 2016, the fund had accumulated long-term gains for federal income tax purposes of $24,559.
15
Financial Highlights |
For a Share Outstanding Throughout the Years Ended August 31 (except as noted) | ||||||||||||||
Per-Share Data | Ratios and Supplemental Data | |||||||||||||
Distributions From: | Ratio to Average Net Assets of: | |||||||||||||
Net Asset Value, Beginning of Period | Income From Investment Operations: Net Investment Income (Loss) | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(1) | Operating Expenses | Operating Expenses (before expense waiver) | Net Investment Income (Loss) | Net Investment Income (Loss) (before expense waiver) | Net Assets, End of Period (in thousands) | |||
Investor Class | ||||||||||||||
2016 | $1.00 | —(2) | —(2) | —(2) | —(2) | $1.00 | 0.02% | 0.29% | 0.50% | 0.02% | (0.19)% | $169,640 | ||
2015 | $1.00 | —(2) | —(2) | — | —(2) | $1.00 | 0.01% | 0.13% | 0.50% | 0.01% | (0.36)% | $199,644 | ||
2014 | $1.00 | —(2) | —(2) | — | —(2) | $1.00 | 0.01% | 0.16% | 0.50% | 0.01% | (0.33)% | $221,042 | ||
2013 | $1.00 | —(2) | —(2) | — | —(2) | $1.00 | 0.01% | 0.28% | 0.50% | 0.01% | (0.21)% | $241,081 | ||
2012 | $1.00 | —(2) | —(2) | —(2) | —(2) | $1.00 | 0.01% | 0.40% | 0.50% | 0.01% | (0.09)% | $263,397 |
Notes to Financial Highlights |
(1) | Total returns are calculated based on the net asset value of the last business day. Total returns for periods less than one year are not annualized. |
(2) | Per-share amount was less than $0.005. |
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Board of Trustees of the American Century California Tax-Free and Municipal Funds and Shareholders of the California Tax-Free Money Market Fund:
In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the California Tax-Free Money Market Fund (one of the four funds in the American Century California Tax-Free and Municipal Funds, hereafter referred to as the "Fund") at August 31, 2016, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at August 31, 2016 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Kansas City, Missouri
October 18, 2016
17
Management |
Board of Trustees
The individuals listed below serve as trustees of the funds. Each trustee will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for trustees who are not “interested persons,” as that term is defined in the Investment Company Act (independent trustees). Independent trustees shall retire on December 31 of the year in which they reach their 75th birthday; provided, however, that on or after January 1, 2022, independent trustees shall retire on December 31 of the year in which they reach their 76th birthday.
Mr. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other trustees (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The trustees serve in this capacity for eight (in the case of Mr. Thomas, 15) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the trustees. The mailing address for each trustee other than Mr. Thomas is 1665 Charleston Road, Mountain View, California 94043. The mailing address for Mr. Thomas is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Trustee | Other Directorships Held During Past 5 Years |
Independent Trustees | |||||
Tanya S. Beder (1955) | Trustee | Since 2011 | Chairman and CEO, SBCC Group Inc. (independent advisory services) (2006 to present) | 44 | CYS Investments, Inc. (NYSE mortgage arbitrage REIT) |
Jeremy I. Bulow (1954) | Trustee | Since 2011 | Professor of Economics, Stanford University, Graduate School of Business (1979 to present) | 44 | None |
Anne Casscells (1958) | Trustee | Since 2016 | Co-Chief Executive Officer and Chief Investment Officer, Aetos Alternatives Management (investment advisory firm) (2001 to present); Lecturer in Accounting, Stanford University, Graduate School of Business (2009 to present) | 44 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Trustee | Other Directorships Held During Past 5 Years |
Independent Trustees | |||||
Ronald J. Gilson (1946) | Trustee and Chairman of the Board | Since 1995 (Chairman since 2005) | Charles J. Meyers Professor of Law and Business, Emeritus, Stanford Law School (1979 to present); Marc and Eva Stern Professor of Law and Business, Columbia University School of Law (1992 to present) | 44 | None |
Frederick L. A. Grauer (1946) | Trustee | Since 2008 | Senior Advisor, iShares by BlackRock, Inc. (investment management firm) (2010 to 2011, 2013 to present); Senior Advisor, Course Hero (an educational technology company) (2015 to present) | 44 | None |
Jonathan D. Levin (1972) | Trustee | Since 2016 | Philip H. Knight Professor and Dean, Graduate School of Business, Stanford University (2016 to present); Professor, Stanford University, (2000 to present); Chair, Department of Economics, Stanford University (2011 to 2014) | 44 | None |
Peter F. Pervere (1947) | Trustee | Since 2007 | Retired | 44 | None |
John B. Shoven (1947) | Trustee | Since 2002 | Charles R. Schwab Professor of Economics, Stanford University (1973 to present) | 44 | Cadence Design Systems; Exponent; Financial Engines |
Interested Trustee | |||||
Jonathan S. Thomas (1963) | Trustee and President | Since 2007 | President and Chief Executive Officer, ACC (March 2007 to present). Also serves as Chief Executive Officer, ACS; Executive Vice President, ACIM; Director, ACC, ACIM and other ACC subsidiaries | 127 | BioMed Valley Discoveries, Inc. |
The Statement of Additional Information has additional information about the fund's trustees and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 15 investment companies in the American Century family of funds, unless otherwise noted. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each of the officers listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years |
Jonathan S. Thomas (1963) | Trustee and President since 2007 | President and Chief Executive Officer, ACC (March 2007 to present). Also serves as Chief Executive Officer, ACS; Executive Vice President, ACIM; Director, ACC, ACIM and other ACC subsidiaries |
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (March 2014 to present); Chief Compliance Officer, ACIM (February 2014 to present); Chief Compliance Officer, ACIS (October 2009 to present); Vice President, Client Interactions and Marketing, ACIS (February 2013 to January 2014); Director, Client Interactions and Marketing, ACIS (June 2007 to January 2013). Also serves as Vice President, ACIS |
Charles A. Etherington (1957) | General Counsel since 2007 and Senior Vice President since 2006 | Attorney, ACC (February 1994 to present); Vice President, ACC (November 2005 to present); General Counsel, ACC (March 2007 to present). Also serves as General Counsel, ACIM, ACS, ACIS and other ACC subsidiaries; and Senior Vice President, ACIM and ACS |
C. Jean Wade (1964) | Vice President, Treasurer and Chief Financial Officer since 2012 | Vice President, ACS (February 2000 to present) |
Robert J. Leach (1966) | Vice President since 2006 and Assistant Treasurer since 2012 | Vice President, ACS (February 2000 to present) |
David H. Reinmiller (1963) | Vice President since 2001 | Attorney, ACC (January 1994 to present); Associate General Counsel, ACC (January 2001 to present). Also serves as Vice President, ACIM and ACS |
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (June 2003 to present) |
20
Approval of Management Agreement |
At a meeting held on June 14, 2016, the Fund’s Board of Trustees (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors/trustees, including a majority of the independent Trustees, each year. The Board regards this annual evaluation and renewal as one of its most important responsibilities.
The independent Trustees have memorialized a statement regarding the relationship between their ongoing obligations to oversee and evaluate the performance of the Advisor and their annual consideration of renewal of the management agreement. In that statement, the independent Trustees noted that their assessment of the Advisor’s performance is an ongoing process that takes place over the entire year and is informed by all of the extensive information that the Board and its committees receive and consider over time. This information, together with the additional materials provided specifically in connection with the review, are central to the Board’s assessment of the Advisor’s performance and its determination whether to renew the Fund’s management agreement.
Prior to its consideration of the renewal of the management agreement, the Board requested and reviewed extensive data and analysis relating to the proposed renewal. This information and analysis was compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor included, but was not limited to, the following:
• | the nature, extent, and quality of investment management, shareholder services, and other services provided by the Advisor to the Fund; |
• | the wide range of other programs and services the Advisor provides to the Fund and its shareholders on a routine and non-routine basis; |
• | the investment performance of the Fund, including data comparing the Fund’s performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies; |
• | the cost of owning the Fund compared to the cost of owning similar funds; |
• | the Advisor’s compliance policies, procedures, and regulatory experience; |
• | financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor; |
• | possible economies of scale associated with the Advisor’s management of the Fund and other accounts under its management; |
• | data comparing services provided and charges to other investment management clients of the Advisor; |
• | acquired fund fees and expenses; |
• | payments by the Fund and the Advisor to financial intermediaries whose clients are investors in the Fund; and |
• | any collateral benefits derived by the Advisor from the management of the Fund. |
In keeping with its practice, the Board held two in-person meetings to review and discuss the information provided in response to their request. The independent Trustees also had the benefit of the advice of their independent counsel throughout the process.
21
Factors Considered
The Trustees considered all of the information provided by the Advisor, the independent data providers, and the independent Trustees’ independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Trustees did not identify any single factor as being all-important or controlling and each Trustee may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including the following:
Nature, Extent and Quality of Services - Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that under the management agreement, the Advisor provides or arranges at its own expense a wide variety of services including:
• | constructing and designing the Fund |
• | portfolio research and security selection |
• | initial capitalization/funding |
• | securities trading |
• | Fund administration |
• | custody of Fund assets |
• | daily valuation of the Fund’s portfolio |
• | shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications |
• | legal services (except the independent Trustees’ counsel) |
• | regulatory and portfolio compliance |
• | financial reporting |
• | marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans) |
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management, Shareholder, and Other Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Trustees recognize that the Advisor has an obligation to seek the best execution of fund trades. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Portfolio Committee, regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Trustees also review detailed performance information during the management agreement approval process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was in the first quartile of its peer group for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
22
Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through various committees of the Board, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction (as measured by external as well as internal sources), technology support, new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. Certain aspects of shareholder and transfer agency service level efficiency and the quality of securities trading activities are measured by independent third party providers and are presented in comparison to other fund groups not managed by the Advisor.
The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund, its overall profitability, and its financial condition. The Trustees have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is appropriately sharing economies of scale through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business to provide shareholders enhanced and expanded services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, the fees and expenses of the Fund’s independent Trustees (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing, and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider and comparing the Fund’s unified fee to the total expense ratio of peer funds. Given the industry-wide proliferation of fee waivers to support positive money market fund yields, the Board recognized that net fee comparisons may be less statistically relevant than in prior years. With that in mind, the Board reviewed peer data both on a gross basis and net of applicable waivers. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
23
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Trustees also requested and received a description of payments made to intermediaries by the Fund and the Advisor. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. The Board noted that the Advisor’s primary business is managing mutual funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. The Board noted that the Advisor receives proprietary research from broker-dealers that execute fund portfolio transactions. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded, however, that the assets of those other clients are not material to the analysis and, where applicable, may be included with the assets of the Fund to determine breakpoints in the management fee schedule.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Trustees. As a result of this process, the Board, including all of the independent Trustees and assisted by the advice of independent legal counsel, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, concluded that the management agreement between the Fund and the Advisor is fair and reasonable in light of the services provided and should be renewed.
24
Proxy Voting Results |
A special meeting of shareholders was held on June 13, 2016, to vote on the following proposal. The proposal received the required number of votes and was adopted. A summary of voting results is listed below.
To elect four trustees to the Board of Trustees of American Century California Tax-Free and Municipal Funds:
Affirmative | Withhold | ||||||
Tanya S. Beder | $ | 2,491,173,919 | $ | 48,905,981 | |||
Jeremy I. Bulow | $ | 2,490,850,243 | $ | 49,229,657 | |||
Anne Casscells | $ | 2,491,569,613 | $ | 48,510,287 | |||
Jonathan D. Levin | $ | 2,491,165,182 | $ | 48,914,718 |
The other trustees whose term of office continued after the meeting include Jonathan S. Thomas, Ronald J. Gilson, Frederick L. A. Grauer, Peter F. Pervere and John B. Shoven.
25
Additional Information |
Proxy Voting Policies
Descriptions of the principles and policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund are available without charge, upon request, by calling 1-800-345-2021 or visiting the "About Us" page of American Century Investments’ website at americancentury.com. A description of the policies is also available on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the "About Us" page at americancentury.com. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund 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 Forms N-Q are available on the SEC’s website at sec.gov, and may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The fund also makes its complete schedule of portfolio holdings for the most recent quarter of its fiscal year available on its website at americancentury.com and, upon request, by calling 1-800-345-2021.
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund designates $36,641 as exempt interest dividends for the fiscal year ended August 31, 2016.
The fund hereby designates $704, or up to the maximum amount allowable, as long-term capital gain distributions (20% rate gain distributions) for the fiscal year ended August 31, 2016.
26
Notes |
Notes |
27
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Contact Us | americancentury.com | |
Automated Information Line | 1-800-345-8765 | |
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |
Investors Using Advisors | 1-800-378-9878 | |
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |
Telecommunications Relay Service for the Deaf | 711 | |
American Century California Tax-Free and Municipal Funds | ||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||
©2016 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-90328 1610 |
![acihorizblkb99.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/acihorizblkb99.jpg)
Annual Report | |
August 31, 2016 | |
California Intermediate-Term Tax-Free Bond Fund |
Table of Contents |
President’s Letter | 2 | |
Performance | 3 | |
Portfolio Commentary | ||
Fund Characteristics | ||
Shareholder Fee Example | ||
Schedule of Investments | ||
Statement of Assets and Liabilities | ||
Statement of Operations | ||
Statement of Changes in Net Assets | ||
Notes to Financial Statements | ||
Financial Highlights | ||
Report of Independent Registered Public Accounting Firm | ||
Management | ||
Approval of Management Agreement | ||
Proxy Voting Results | ||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![jthomasrev0514.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/jthomasrev0514.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended August 31, 2016. It provides investment performance and portfolio information for the reporting period, plus longer-term historical performance data.
Annual reports remain important vehicles for conveying information about fund returns, including market factors that affected performance during the reporting period. For additional, updated investment and market insights, we encourage you to visit our website, americancentury.com.
Municipal Bonds (Munis) Generally Extended Their Solid Performance
Key conditions described in our semiannual report letter extended for another six months. Widespread concerns about global economic growth sparked financial market volatility, followed by monetary policy reactions from central banks. The primary catalyst in 2015 was China, where slowing economic growth and currency devaluations sent shock waves through the global markets. These factors re-emerged in January and early February 2016, triggering sell-offs in riskier assets such as stocks and high-yield bonds and encouraging central banks in Japan and Europe to cut interest rates and/or extend their bond-buying (quantitative easing, QE) programs. More QE came after Brexit, the U.K.’s vote to exit the European Union. Monetary policy expansion produced negative interest rates in Japan and Europe, and lowered longer-maturity bond yields globally.
In this bond-friendly environment, munis generally continued to perform well. The broad muni market benefited from its comparatively high overall credit quality, despite defaults in Puerto Rico and financial concerns facing Illinois and New Jersey. We continue to view these as isolated incidents running counter to overall muni credit quality trends. Also, as government bond yields fell globally, after-tax muni yields looked attractive, especially for investors in top tax brackets.
After 12 straight months of positive performance for the broad muni market, we’re positioning muni portfolios for increased volatility (and the possibility of lower returns) after heavy demand compressed the yield differences (spreads) between shorter- and longer-maturity bonds, and higher- and lower-quality bonds. Spreads narrowed to an extent in August 2016 that would indicate a greater chance of widening than narrowing, given the uncertainties ahead, including central bank reviews of their QE programs, the Federal Reserve’s desire to raise interest rates, the fallout from Brexit, and the U.S. presidential election. We appreciate your continued trust in us during this challenging period.
Sincerely,
![image48a01.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/image48a01.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
2
Performance |
Total Returns as of August 31, 2016 | ||||||
Average Annual Returns | ||||||
Ticker Symbol | 1 year | 5 years | 10 years | Since Inception | Inception Date | |
Investor Class | BCITX | 5.74% | 4.05% | 4.23% | — | 11/9/83 |
Bloomberg Barclays 7 Year Municipal Bond Index | — | 5.68% | 3.76% | 4.91% | — | — |
Institutional Class | BCTIX | 5.95% | 4.25% | — | 4.49% | 3/1/10 |
A Class | BCIAX | 3/1/10 | ||||
No sales charge | 5.47% | 3.79% | — | 4.02% | ||
With sales charge | 0.71% | 2.83% | — | 3.28% | ||
C Class | BCIYX | 4.60% | 3.00% | — | 3.25% | 3/1/10 |
Average annual returns since inception are presented when ten years of performance history is not available.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 4.50% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please
call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
3
Growth of $10,000 Over 10 Years |
$10,000 investment made August 31, 2006 |
Performance for other share classes will vary due to differences in fee structure. |
![acctfmf831_chart-54766.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/acctfmf831_chart-54766.jpg)
Value on August 31, 2016 | |
Investor Class — $15,140 | |
Bloomberg Barclays 7 Year Municipal Bond Index — $16,150 | |
Total Annual Fund Operating Expenses | |||
Investor Class | Institutional Class | A Class | C Class |
0.47% | 0.27% | 0.72% | 1.47% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please
call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
4
Portfolio Commentary |
Portfolio Managers: Joseph Gotelli, Alan Kruss, and Steven Permut
Performance Summary
California Intermediate-Term Tax-Free Bond returned 5.74%* for the 12 months ended August 31, 2016, outperforming the Bloomberg Barclays 7 Year Municipal Bond Index, which returned 5.68%. Fund returns reflect operating expenses, while index returns do not.
The fund’s absolute return for the reporting period reflected the positive overall performance of municipal bonds (munis) and California munis in particular. The muni market generally rallied, posting a positive total return in each of the 12 months and outperforming the U.S. Treasury market and the broad taxable investment-grade U.S. fixed-income market for the entire period. In addition to benefiting from a favorable backdrop for U.S. fixed-income securities—which included declining interest rates and muted inflation—munis advanced on stable credit trends, positive flows, and other supportive supply/demand factors.
Favorable Fixed-Income Backdrop, Muni Market Dynamics Fueled Gains
Investor concerns about global growth, commodity prices, and central bank monetary decisions generated volatility during the 12-month period. The U.S. economy continued to exhibit modest growth, particularly compared with the rest of the developed world, but the U.S. Federal Reserve (the Fed) remained focused on the sluggish global landscape and its potential risks to the U.S. economy. This triggered ongoing investor speculation regarding the timing and magnitude of Fed interest rate “normalization” and contributed to the volatile climate. However, the Fed implemented only one rate hike during the period—a 25 basis point increase (1 basis point equals 0.01%) on December 16, 2015, which pushed the range for the federal funds rate target to 0.25%-0.50%.
Despite expectations for additional rate hikes in 2016, the Fed cited concerns about the health of the global economy, the uncertainty triggered by the U.K. vote in late June to exit the European Union (Brexit), and weaker-than-expected U.S. economic growth as reasons to pursue a “lower for longer” rate strategy. Meanwhile, central banks in Europe, Japan, and China continued to implement aggressive stimulus programs in response to weak growth rates and deflation threats in those regions. This action increased the relative attractiveness of the U.S. bond market, where yields were generally higher.
This environment led to positive performance for U.S. Treasuries and other U.S. bond market sectors. Munis generally tracked the U.S. Treasury market, but factors specific to the municipal market helped munis outperform. In particular, supply and demand dynamics remained favorable and supported gains. Overall supply increased only slightly, while demand for munis remained robust due to the tax advantages and perceived “safe-haven” munis offered investors. As of August 31, 2016, muni funds experienced 48 consecutive weeks of positive flows, according to Lipper Inc.
Overall, all major sectors of the muni bond market posted positive returns for the 12-month period, according to Bloomberg Barclays. Reflecting investor demand for yield, longer-maturity and lower-quality munis generally performed better than shorter-maturity and higher-quality securities. In addition, revenue bonds outperformed general obligation (GO) bonds.
* All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structure; when Investor Class performance exceeds that of the fund's benchmark, other share classes may not. See page 3 for returns for all share classes.
5
State and National Fiscal, Credit Backdrops Were Generally Positive
State and local finances in California and across the U.S. remained relatively healthy, even as tax revenue growth slowed due to stock market volatility. Spending restraint enabled most states, including California, to maintain stable credit profiles. Furthermore, California’s job growth outpaced the national average, and the state’s housing market continued to improve. In addition, state officials reported $7.3 billion in reserves at the end of fiscal year 2016 and projected reserves would climb to $8.5 billion by the end of fiscal year 2017. Also, in August 2016, Fitch Ratings upgraded California’s bond credit rating from “A+” to “AA-.”
From a national credit rating perspective, downgrades outpaced upgrades in the second calendar quarter of 2016, largely due to troubled credits in Illinois and Michigan. Overall, the national muni default rate remained low. We continue to believe it is unlikely any states will default, but special circumstances may continue to pressure isolated state, local, and commonwealth credit ratings, such as those in Puerto Rico, Illinois, New Jersey, and Michigan.
Maturity Structure, Longer Duration Led to Outperformance
We maintained a “laddered” maturity structure, which seeks broad exposure across the yield curve to achieve a particular weighted average maturity (WAM). Conversely, the index is “bulleted,” focusing on a particular segment of the muni yield curve to achieve its WAM. We also maintained a flattening bias with respect to the portfolio’s yield-curve positioning, favoring intermediate- and longer-maturity munis over shorter-maturity munis. These strategies aided relative performance as yields on intermediate- and longer-maturity securities declined more than yields on shorter-maturity munis, causing the muni yield curve to flatten. The portfolio’s duration (price sensitivity to interest rate changes), which was slightly longer than the index’s, also lifted performance in this yield environment.
Meanwhile, sector allocation and security selection produced mixed results relative to the index. Overall, our preference for revenue bonds over GO bonds generally aided results, while security selection among public power and lease revenue bonds detracted. An overweight position versus the index in prerefunded debt also detracted slightly.
Focus on Yield in Range-Bound Market
We believe U.S. economic fundamentals support slightly higher interest rates. But low inflation, weaker global economic fundamentals, low interest rates in Europe and Japan, weak commodity prices, a strong U.S. dollar, and geopolitical uncertainty (particularly in the wake of the Brexit vote) will, in our view, likely keep Fed action slow and data dependent, and keep rates range-bound in the near term. For this reason, we are comfortable maintaining a slightly longer-than-average duration and a slight bias toward lower-quality credits—two strategies that have helped enhance the portfolio’s yield. We also believe volatility may escalate ahead of the November U.S. presidential election, and such volatility may cause credit spreads (the yield differential between high-quality and low-quality munis of similar maturity) to widen. This potential backdrop may present compelling buying opportunities among lower-quality credits. In this environment, we believe fundamental credit research, active management, and security selection will become increasingly important.
6
Fund Characteristics |
AUGUST 31, 2016 | |
Portfolio at a Glance | |
Weighted Average Maturity | 9.2 years |
Average Duration (Modified) | 4.8 years |
Top Five Sectors | % of fund investments |
General Obligation (GO) - Local | 11% |
Hospital | 11% |
Lease Revenue | 10% |
Public Power | 10% |
General Obligation (GO) - State | 8% |
Types of Investments in Portfolio | % of net assets |
Municipal Securities | 100.8% |
Other Assets and Liabilities | (0.8)% |
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from March 1, 2016 to August 31, 2016.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or Institutional Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not a financial intermediary or retirement plan account), American Century Investments may charge you a $12.50 semiannual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $12.50 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments Brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments Brokerage accounts, you are currently not subject to this fee. If you are subject to the Account Maintenance Fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 3/1/16 | Ending Account Value 8/31/16 | Expenses Paid During Period(1) 3/1/16 - 8/31/16 | Annualized Expense Ratio(1) | |
Actual | ||||
Investor Class | $1,000 | $1,025.00 | $2.39 | 0.47% |
Institutional Class | $1,000 | $1,026.10 | $1.38 | 0.27% |
A Class | $1,000 | $1,023.70 | $3.66 | 0.72% |
C Class | $1,000 | $1,019.90 | $7.46 | 1.47% |
Hypothetical | ||||
Investor Class | $1,000 | $1,022.77 | $2.39 | 0.47% |
Institutional Class | $1,000 | $1,023.78 | $1.37 | 0.27% |
A Class | $1,000 | $1,021.52 | $3.66 | 0.72% |
C Class | $1,000 | $1,017.75 | $7.46 | 1.47% |
(1) | Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 184, the number of days in the most recent fiscal half-year, divided by 366, to reflect the one-half year period. |
9
Schedule of Investments |
AUGUST 31, 2016
Principal Amount | Value | |||||
MUNICIPAL SECURITIES — 100.8% | ||||||
California — 100.7% | ||||||
ABAG Finance Authority for Nonprofit Corps. Rev., (Jackson Laboratory), 5.00%, 7/1/17 | $ | 1,000,000 | $ | 1,034,630 | ||
ABAG Finance Authority for Nonprofit Corps. Rev., (Jackson Laboratory), 5.00%, 7/1/18 | 500,000 | 536,900 | ||||
ABAG Finance Authority for Nonprofit Corps. Rev., (Sharp Healthcare Obligated Group), 6.00%, 8/1/30 | 2,500,000 | 3,051,175 | ||||
ABAG Finance Authority for Nonprofit Corps. Rev., (Sharp Healthcare Obligated Group), 5.00%, 8/1/33 | 1,450,000 | 1,745,408 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/20 | 3,010,000 | 3,511,887 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/22 | 1,000,000 | 1,208,900 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/24 | 2,000,000 | 2,500,340 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/25 | 500,000 | 636,275 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/36 | 3,000,000 | 3,658,770 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/37 | 500,000 | 608,800 | ||||
Alameda Corridor Transportation Authority Rev., Capital Appreciation, 0.00%, 10/1/35 (NATL)(1) | 9,000,000 | 4,942,980 | ||||
Alum Rock Union Elementary School District GO, 6.00%, 8/1/39 | 1,500,000 | 1,944,555 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 10/1/23 | 1,200,000 | 1,483,200 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 10/1/24 | 2,275,000 | 2,800,570 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 5/1/25 | 1,000,000 | 1,252,590 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 5/1/28 | 1,100,000 | 1,368,818 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 5/1/29 | 1,250,000 | 1,545,663 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 5/1/34 | 1,360,000 | 1,661,607 | ||||
Anaheim Public Financing Authority Rev., 5.375%, 10/1/36 | 700,000 | 826,861 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 5/1/39 | 1,550,000 | 1,878,956 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 5/1/46 | 2,000,000 | 2,405,540 | ||||
Bay Area Toll Authority Rev., 5.00%, 4/1/17, Prerefunded at 100% of Par(2) | 2,000,000 | 2,052,880 | ||||
Bay Area Toll Authority Rev., 5.00%, 4/1/24 | 1,500,000 | 1,826,415 | ||||
Bay Area Toll Authority Rev., 5.00%, 4/1/25 | 3,500,000 | 4,259,500 | ||||
Bay Area Toll Authority Rev., 5.00%, 4/1/28 | 7,185,000 | 8,731,068 | ||||
Bay Area Toll Authority Rev., 2.00%, 4/1/34 | 2,000,000 | 2,073,720 | ||||
Bay Area Toll Authority Rev., 5.00%, 4/1/43 | 5,610,000 | 6,777,778 | ||||
Bay Area Toll Authority Rev., 5.00%, 10/1/54 | 5,000,000 | 6,001,750 | ||||
Bay Area Toll Authority Rev., VRDN, 1.26%, 9/1/16 | 1,000,000 | 1,000,310 | ||||
Bay Area Toll Authority Rev., VRDN, 1.66%, 9/1/16 | 2,500,000 | 2,526,150 | ||||
Bay Area Toll Authority Rev., VRDN, 1.81%, 9/1/16 | 3,500,000 | 3,564,225 | ||||
Bay Area Toll Authority Rev., VRDN, 1.50%, 4/2/18 | 3,000,000 | 3,021,300 | ||||
California Educational Facilities Authority Rev., (Chapman University), 5.00%, 4/1/21 | 750,000 | 879,840 | ||||
California Educational Facilities Authority Rev., (Chapman University), 5.00%, 4/1/24 | 930,000 | 1,157,394 | ||||
California Educational Facilities Authority Rev., (Chapman University), 5.00%, 4/1/31 (GA: Brandman University) | 1,455,000 | 1,681,136 |
10
Principal Amount | Value | |||||
California Educational Facilities Authority Rev., (Loyola Marymount University), 5.00%, 10/1/30 | $ | 1,365,000 | $ | 1,524,282 | ||
California Educational Facilities Authority Rev., (Pomona College), 5.00%, 1/1/24 | 2,100,000 | 2,312,205 | ||||
California Educational Facilities Authority Rev., (Santa Clara University), 5.00%, 4/1/18, Prerefunded at 100% of Par(2) | 655,000 | 700,346 | ||||
California Educational Facilities Authority Rev., (Santa Clara University), 5.00%, 4/1/18 | 500,000 | 535,685 | ||||
California Educational Facilities Authority Rev., (Santa Clara University), 5.25%, 4/1/18, Prerefunded at 100% of Par(2) | 1,875,000 | 2,012,175 | ||||
California Educational Facilities Authority Rev., (Santa Clara University), 5.00%, 4/1/19 | 45,000 | 48,169 | ||||
California Educational Facilities Authority Rev., (Santa Clara University), 5.25%, 4/1/23 | 125,000 | 133,883 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 5.00%, 10/1/27 | 275,000 | 346,825 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 5.00%, 10/1/28 | 250,000 | 312,940 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 3.00%, 10/1/29 | 360,000 | 381,258 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 3.00%, 10/1/30 | 365,000 | 384,119 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 3.125%, 10/1/31 | 295,000 | 312,042 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 5.00%, 10/1/32 | 600,000 | 737,448 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 3.25%, 10/1/33 | 355,000 | 373,730 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 5.00%, 10/1/36 | 250,000 | 303,675 | ||||
California Educational Facilities Authority Rev., (University of San Francisco), 5.00%, 10/1/16 | 1,200,000 | 1,204,572 | ||||
California Educational Facilities Authority Rev., (University of San Francisco), 5.00%, 10/1/21 | 750,000 | 897,075 | ||||
California Educational Facilities Authority Rev., (University of Southern California), 5.00%, 10/1/25 | 1,875,000 | 2,469,881 | ||||
California Educational Facilities Authority Rev., (University of Southern California), 5.00%, 10/1/39 | 2,950,000 | 3,208,184 | ||||
California Educational Facilities Authority Rev., (University of the Pacific), 4.50%, 11/1/17 | 1,000,000 | 1,043,590 | ||||
California Educational Facilities Authority Rev., (University of the Pacific), 5.00%, 11/1/33 | 1,000,000 | 1,233,130 | ||||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/21(3) | 800,000 | 906,360 | ||||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/23(3) | 1,500,000 | 1,748,775 | ||||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/25(3) | 1,000,000 | 1,193,290 | ||||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/26(3) | 1,500,000 | 1,802,655 | ||||
California Health Facilities Financing Authority Rev., (Cedars-Sinai Medical Center), 5.00%, 8/15/18 | 1,000,000 | 1,084,440 | ||||
California Health Facilities Financing Authority Rev., (Cedars-Sinai Medical Center), 5.00%, 11/15/22 | 3,000,000 | 3,717,210 | ||||
California Health Facilities Financing Authority Rev., (Cedars-Sinai Medical Center), 5.00%, 11/15/23 | 2,150,000 | 2,711,064 | ||||
California Health Facilities Financing Authority Rev., (Cedars-Sinai Medical Center), 5.00%, 11/15/24 | 1,450,000 | 1,861,220 |
11
Principal Amount | Value | |||||
California Health Facilities Financing Authority Rev., (Cedars-Sinai Medical Center), 5.00%, 11/15/26 | $ | 3,000,000 | $ | 3,872,790 | ||
California Health Facilities Financing Authority Rev., (Cedars-Sinai Medical Center), 5.00%, 11/15/27 | 6,000,000 | 7,686,420 | ||||
California Health Facilities Financing Authority Rev., (Children's Hospital of Orange County), 6.25%, 11/1/29 (GA: Children's Heathcare of California) | 5,000,000 | 5,859,500 | ||||
California Health Facilities Financing Authority Rev., (Dignity Health Obligated Group), 5.00%, 7/1/18 | 3,000,000 | 3,236,550 | ||||
California Health Facilities Financing Authority Rev., (Lucile Salter Packard Children's Hospital at Stanford Obligated Group), 5.00%, 8/15/25 | 5,855,000 | 7,086,658 | ||||
California Health Facilities Financing Authority Rev., (Lucile Salter Packard Children's Hospital at Stanford Obligated Group), VRDN, 1.45%, 3/15/17, Prerefunded at 100% of Par(2) | 2,000,000 | 2,009,920 | ||||
California Health Facilities Financing Authority Rev., (Lucile Salter Packard Children's Hospital at Stanford Obligated Group), VRDN, 1.45%, 3/15/17, Prerefunded at 100% of Par(2) | 2,200,000 | 2,210,912 | ||||
California Health Facilities Financing Authority Rev., (Lucile Salter Packard Children's Hospital at Stanford Obligated Group), VRDN, 1.45%, 3/15/17, Prerefunded at 100% of Par(2) | 1,205,000 | 1,210,977 | ||||
California Health Facilities Financing Authority Rev., (Northern California Retired Officers Community), 5.70%, 12/1/24 (Ambac/California Mortgage Insurance) | 1,455,000 | 1,608,546 | ||||
California Health Facilities Financing Authority Rev., (Providence Health & Services Obligated Group), 6.25%, 10/1/18, Prerefunded at 100% of Par(2) | 3,250,000 | 3,633,207 | ||||
California Health Facilities Financing Authority Rev., (Providence Health & Services Obligated Group), 6.50%, 10/1/18, Prerefunded at 100% of Par(2) | 40,000 | 44,878 | ||||
California Health Facilities Financing Authority Rev., (Providence Health & Services Obligated Group), 6.50%, 10/1/18, Prerefunded at 100% of Par(2) | 2,085,000 | 2,339,287 | ||||
California Health Facilities Financing Authority Rev., (Providence St. Joseph Health Obligated Group), 5.00%, 10/1/28(3) | 1,100,000 | 1,428,658 | ||||
California Health Facilities Financing Authority Rev., (Providence St. Joseph Health Obligated Group), 5.00%, 10/1/29(3) | 2,050,000 | 2,644,541 | ||||
California Health Facilities Financing Authority Rev., (Providence St. Joseph Health Obligated Group), 5.00%, 10/1/30(3) | 1,550,000 | 1,986,061 | ||||
California Health Facilities Financing Authority Rev., (Scripps Health Obligated Group), 5.00%, 10/1/17 | 1,400,000 | 1,466,486 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System Obligated Group), 5.50%, 7/1/29 | 1,500,000 | 1,696,425 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System Obligated Group), 5.00%, 7/1/37 | 890,000 | 1,058,468 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System Obligated Group), 5.75%, 7/1/39 | 1,000,000 | 1,135,060 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System Obligated Group), VRDN, 5.00%, 10/18/22 | 7,000,000 | 8,532,580 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System), VRDN, 0.62%, 9/1/16 (LOC: U.S. Bank N.A.) | 735,000 | 735,000 | ||||
California Health Facilities Financing Authority Rev., (Stanford Health Care Obligated Group), 5.00%, 11/15/25 | 2,000,000 | 2,343,980 | ||||
California Health Facilities Financing Authority Rev., (Stanford Health Care Obligated Group), 5.00%, 8/15/51 | 1,000,000 | 1,176,230 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.50%, 8/15/17 | 1,000,000 | 1,048,220 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 8/15/18 | 1,305,000 | 1,417,060 |
12
Principal Amount | Value | |||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 11/15/21 | $ | 300,000 | $ | 363,390 | ||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 8/15/22 | 1,650,000 | 1,996,582 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.25%, 8/15/22 | 3,335,000 | 3,632,015 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 11/15/22 | 200,000 | 247,814 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 11/15/23 | 600,000 | 756,576 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 11/15/28 | 465,000 | 591,945 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 11/15/29 | 1,000,000 | 1,265,120 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 11/15/30 | 750,000 | 946,935 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 6.00%, 8/15/42 | 1,000,000 | 1,197,310 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 8/15/52 | 3,650,000 | 4,318,570 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), VRDN, 1.00%, 8/15/19 | 10,000,000 | 10,029,900 | ||||
California Infrastructure & Economic Development Bank Rev., (Academy of Motion Picture Arts and Sciences Obligated Group), 5.00%, 11/1/27 | 1,010,000 | 1,264,379 | ||||
California Infrastructure & Economic Development Bank Rev., (Academy of Motion Picture Arts and Sciences Obligated Group), 5.00%, 11/1/28 | 1,205,000 | 1,501,490 | ||||
California Infrastructure & Economic Development Bank Rev., (Academy of Motion Picture Arts and Sciences Obligated Group), 5.00%, 11/1/29 | 1,000,000 | 1,239,130 | ||||
California Infrastructure & Economic Development Bank Rev., (Academy of Motion Picture Arts and Sciences Obligated Group), 5.00%, 11/1/30 | 1,370,000 | 1,695,690 | ||||
California Infrastructure & Economic Development Bank Rev., (Academy of Motion Picture Arts and Sciences Obligated Group), 5.00%, 11/1/41 | 1,000,000 | 1,202,310 | ||||
California Infrastructure & Economic Development Bank Rev., (Academy of Motion Picture Arts and Sciences Obligated Group), 4.00%, 11/1/45 | 1,250,000 | 1,369,713 | ||||
California Infrastructure & Economic Development Bank Rev., (Colburn School), VRDN, 1.56%, 9/1/16 | 4,375,000 | 4,405,231 | ||||
California Infrastructure & Economic Development Bank Rev., (Goodwill Industries of Orange County), VRDN, 0.62%, 9/1/16 (LOC: Wells Fargo Bank N.A.) | 2,315,000 | 2,315,000 | ||||
California Infrastructure & Economic Development Bank Rev., (J Paul Getty Trust), VRDN, 0.84%, 9/1/16 | 5,000,000 | 5,000,450 | ||||
California Infrastructure & Economic Development Bank Rev., (J Paul Getty Trust), VRDN, 0.84%, 9/1/16 | 2,750,000 | 2,754,097 | ||||
California Infrastructure & Economic Development Bank Rev., (Museum Associates), VRDN, 2.11%, 9/1/16 | 3,000,000 | 3,061,380 | ||||
California Infrastructure & Economic Development Bank Rev., (Pacific Gas & Electric Co.), VRDN, 0.63%, 9/1/16 (LOC: Union Bank N.A.) | 16,400,000 | 16,400,000 | ||||
California Infrastructure & Economic Development Bank Rev., (Pacific Gas & Electric Co.), VRDN, 0.63%, 9/1/16 (LOC: Union Bank N.A.) | 16,500,000 | 16,500,000 | ||||
California Infrastructure & Economic Development Bank Rev., (Scripps Research Institute), 5.625%, 7/1/20 | 555,000 | 556,443 |
13
Principal Amount | Value | |||||
California Infrastructure & Economic Development Bank Rev., (Scripps Research Institute), 5.00%, 7/1/22 | $ | 650,000 | $ | 787,131 | ||
California Infrastructure & Economic Development Bank Rev., (Scripps Research Institute), 5.00%, 7/1/23 | 300,000 | 371,469 | ||||
California Infrastructure & Economic Development Bank Rev., (Scripps Research Institute), 4.00%, 7/1/29 | 1,480,000 | 1,715,098 | ||||
California Infrastructure & Economic Development Bank Rev., (Segerstrom Center for the Arts), 5.00%, 7/1/26 | 8,000,000 | 10,264,400 | ||||
California Infrastructure & Economic Development Bank Rev., (University of California), 5.00%, 5/15/22 | 3,735,000 | 4,300,740 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 4.00%, 2/1/20 (GA: Walt & Lilly Disney Foundation) | 400,000 | 443,324 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 4.00%, 2/1/21 (GA: Walt & Lilly Disney Foundation) | 175,000 | 198,436 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 5.00%, 2/1/22 (GA: Walt & Lilly Disney Foundation) | 150,000 | 180,758 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 5.00%, 2/1/24 (GA: Walt & Lilly Disney Foundation) | 215,000 | 270,605 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 5.00%, 2/1/26 (GA: Walt & Lilly Disney Foundation) | 750,000 | 975,300 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 5.00%, 2/1/27 (GA: Walt & Lilly Disney Foundation) | 1,000,000 | 1,288,520 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 5.00%, 2/1/29 (GA: Walt & Lilly Disney Foundation) | 700,000 | 889,448 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 5.00%, 2/1/31 (GA: Walt & Lilly Disney Foundation) | 570,000 | 716,097 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 4.00%, 2/1/33 (GA: Walt & Lilly Disney Foundation) | 615,000 | 698,037 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 4.00%, 2/1/34 (GA: Walt & Lilly Disney Foundation) | 500,000 | 567,060 | ||||
California Infrastructure & Economic Development Bank Rev., (Walt Disney Family Museum LLC), 4.00%, 2/1/35 (GA: Walt & Lilly Disney Foundation) | 500,000 | 564,365 | ||||
California Municipal Finance Authority COP, (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/17 | 2,000,000 | 2,034,580 | ||||
California Municipal Finance Authority Rev., (Azusa Pacific University), 5.00%, 4/1/27 | 1,165,000 | 1,398,105 | ||||
California Municipal Finance Authority Rev., (Biola University, Inc.), 5.00%, 10/1/18 | 1,000,000 | 1,046,010 | ||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/22 | 1,000,000 | 1,183,410 | ||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/23 | 520,000 | 625,524 | ||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/25 | 1,925,000 | 2,396,971 | ||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/27 | 545,000 | 671,020 | ||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/28 | 735,000 | 899,273 |
14
Principal Amount | Value | |||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/29 | $ | 1,000,000 | $ | 1,216,680 | ||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/46 | 4,000,000 | 4,657,320 | ||||
California Municipal Finance Authority Rev., (Eisenhower Medical Center), 5.00%, 7/1/19 | 605,000 | 665,373 | ||||
California Municipal Finance Authority Rev., (Eisenhower Medical Center), 5.25%, 7/1/21 | 1,760,000 | 2,012,366 | ||||
California Municipal Finance Authority Rev., (Emerson College), 5.75%, 1/1/33 | 2,250,000 | 2,670,997 | ||||
California Municipal Finance Authority Rev., (Emerson College), 6.00%, 1/1/42 | 1,000,000 | 1,208,120 | ||||
California Municipal Finance Authority Rev., (Loma Linda University), 5.00%, 4/1/23 | 1,145,000 | 1,173,110 | ||||
California Municipal Finance Authority Rev., (Loma Linda University), 5.00%, 4/1/28 | 2,000,000 | 2,045,660 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 3.00%, 11/1/20 | 1,000,000 | 1,065,700 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 3.00%, 11/1/21 | 1,680,000 | 1,802,035 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 4.00%, 11/1/22 | 1,000,000 | 1,129,390 | ||||
California Municipal Finance Authority Rev., (University of La Verne), 5.00%, 6/1/17 | 2,290,000 | 2,356,914 | ||||
California School Finance Authority Rev., (Alliance for College Ready Public Schools Obligated Group), 3.00%, 7/1/19(4) | 1,025,000 | 1,064,042 | ||||
California School Finance Authority Rev., (Alliance for College Ready Public Schools Obligated Group), 3.00%, 7/1/20(4) | 1,115,000 | 1,161,930 | ||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/46(4) | 1,000,000 | 1,148,120 | ||||
California State Public Works Board Rev., 5.00%, 10/1/16 (NATL) | 1,500,000 | 1,505,805 | ||||
California State Public Works Board Rev., 4.00%, 11/1/17 | 1,250,000 | 1,300,725 | ||||
California State Public Works Board Rev., 5.00%, 4/1/21 | 3,000,000 | 3,556,260 | ||||
California State Public Works Board Rev., 5.00%, 4/1/22 | 2,100,000 | 2,544,591 | ||||
California State Public Works Board Rev., 5.00%, 9/1/22, Prerefunded at 100% of Par(2) | 1,000,000 | 1,230,520 | ||||
California State Public Works Board Rev., 5.00%, 4/1/23 | 2,000,000 | 2,408,340 | ||||
California State Public Works Board Rev., 5.00%, 9/1/23, Prerefunded at 100% of Par(2) | 4,500,000 | 5,686,740 | ||||
California State Public Works Board Rev., 5.00%, 4/1/25 | 1,800,000 | 2,171,016 | ||||
California State Public Works Board Rev., 5.00%, 9/1/25 | 5,000,000 | 6,327,550 | ||||
California State Public Works Board Rev., 5.25%, 12/1/26 | 2,000,000 | 2,408,920 | ||||
California State Public Works Board Rev., 6.00%, 4/1/27 | 2,130,000 | 2,417,763 | ||||
California State Public Works Board Rev., 5.00%, 5/1/27 | 5,000,000 | 6,325,900 | ||||
California State Public Works Board Rev., 6.25%, 4/1/34 | 2,435,000 | 2,775,486 | ||||
California State Public Works Board Rev., 6.375%, 11/1/34 | 2,500,000 | 2,932,750 | ||||
California State Public Works Board Rev., 5.00%, 4/1/37 | 4,545,000 | 5,348,556 | ||||
California State Public Works Board Rev., 5.00%, 11/1/38 | 2,400,000 | 2,917,752 | ||||
California State University Rev., 5.00%, 11/1/18 | 1,800,000 | 1,970,082 | ||||
California State University Rev., 5.00%, 11/1/19 | 1,000,000 | 1,135,880 | ||||
California State University Rev., 5.00%, 11/1/20 | 1,250,000 | 1,467,513 | ||||
California State University Rev., 5.00%, 11/1/21 | 1,000,000 | 1,209,880 | ||||
California State University Rev., 5.00%, 11/1/24 | 5,000,000 | 5,951,700 |
15
Principal Amount | Value | |||||
California State University Rev., 5.00%, 11/1/32 | $ | 1,750,000 | $ | 2,190,090 | ||
California State University Rev., 4.00%, 11/1/45 | 4,600,000 | 5,193,354 | ||||
California State University Rev., VRDN, 4.00%, 11/1/23 | 4,000,000 | 4,677,040 | ||||
California Statewide Communities Development Authority Rev., 5.20%, 10/1/18 (AGM)(2) | 440,000 | 441,703 | ||||
California Statewide Communities Development Authority Rev., (Adventist Health System/West Obligated Group), 5.00%, 3/1/23 | 1,190,000 | 1,461,820 | ||||
California Statewide Communities Development Authority Rev., (Adventist Health System/West Obligated Group), 5.00%, 3/1/24 | 800,000 | 1,001,256 | ||||
California Statewide Communities Development Authority Rev., (Adventist Health System/West Obligated Group), 5.00%, 3/1/25 | 750,000 | 956,145 | ||||
California Statewide Communities Development Authority Rev., (Adventist Health System/West Obligated Group), 5.00%, 3/1/26 | 1,000,000 | 1,295,690 | ||||
California Statewide Communities Development Authority Rev., (Adventist Health System/West Obligated Group), 5.00%, 3/1/27 | 1,590,000 | 2,039,445 | ||||
California Statewide Communities Development Authority Rev., (California Baptist University), 5.30%, 11/1/18 | 1,300,000 | 1,358,045 | ||||
California Statewide Communities Development Authority Rev., (California Baptist University), 5.40%, 11/1/27 | 1,000,000 | 1,040,760 | ||||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 5.00%, 5/15/21 | 1,225,000 | 1,435,063 | ||||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 5.00%, 5/15/22 | 2,000,000 | 2,388,100 | ||||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 5.00%, 5/15/23 | 1,000,000 | 1,218,150 | ||||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 5.00%, 5/15/28 | 1,000,000 | 1,262,460 | ||||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 5.00%, 5/15/29 | 1,250,000 | 1,569,450 | ||||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 5.00%, 5/15/30 | 1,940,000 | 2,425,097 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/22 | 475,000 | 571,796 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/23 | 600,000 | 734,814 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/24 | 750,000 | 935,468 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/25 | 800,000 | 984,608 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/26 | 885,000 | 1,082,718 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/27 | 1,880,000 | 2,290,084 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.00%, 11/1/16 | 750,000 | 755,775 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.00%, 11/1/17 | 815,000 | 856,671 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 4.00%, 11/1/18 | 200,000 | 214,172 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.00%, 11/1/18 | 515,000 | 562,550 |
16
Principal Amount | Value | |||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 4.00%, 11/1/19 | $ | 200,000 | $ | 219,936 | ||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.00%, 11/1/20 | 100,000 | 116,601 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 4.00%, 11/1/21 | 150,000 | 172,260 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.00%, 11/1/22 | 125,000 | 153,525 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.00%, 11/1/23 | 150,000 | 188,343 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.00%, 11/1/24 | 200,000 | 253,578 | ||||
California Statewide Communities Development Authority Rev., (Henry Mayo Newhall Memorial Hospital), 5.00%, 10/1/17, Prerefunded at 100% of Par (California Mortgage Insurance)(2) | 1,000,000 | 1,049,000 | ||||
California Statewide Communities Development Authority Rev., (Hospital Committee for the Livermore-Pleasanton Areas), 4.80%, 7/15/17(2) | 625,000 | 648,606 | ||||
California Statewide Communities Development Authority Rev., (Hospital Committee for the Livermore-Pleasanton Areas), 5.00%, 7/15/17, Prerefunded at 100% of Par(2) | 2,460,000 | 2,557,195 | ||||
California Statewide Communities Development Authority Rev., (John Muir Health), 5.00%, 7/1/20 | 2,225,000 | 2,493,936 | ||||
California Statewide Communities Development Authority Rev., (Kaiser Credit Group), 5.00%, 4/1/19 | 1,450,000 | 1,611,516 | ||||
California Statewide Communities Development Authority Rev., (Kaiser Credit Group), 5.00%, 4/1/42 | 8,400,000 | 9,797,340 | ||||
California Statewide Communities Development Authority Rev., (Kaiser Credit Group), VRDN, 5.00%, 5/1/17 | 5,000,000 | 5,141,100 | ||||
California Statewide Communities Development Authority Rev., (Los Angeles Jewish Home for the Aging Obligated Group), 3.00%, 8/1/21 (GA: Jewish Home Foundation/California Mortgage Insurance) | 3,900,000 | 3,913,377 | ||||
California Statewide Communities Development Authority Rev., (Rady Children's Hospital Obligated Group), 5.00%, 8/15/28 | 860,000 | 1,152,933 | ||||
California Statewide Communities Development Authority Rev., (Southern California Edison Co.), VRDN, 1.375%, 4/2/18 | 1,775,000 | 1,791,330 | ||||
California Statewide Communities Development Authority Rev., (St. Joseph Health System), 5.125%, 7/1/24 (NATL) | 2,000,000 | 2,158,820 | ||||
California Statewide Communities Development Authority Rev., (Trinity Health Corp. Obligated Group), 5.00%, 12/1/41 | 1,570,000 | 1,850,732 | ||||
Capistrano Unified School District Community Facilities District No. 87-1 Special Tax, 5.00%, 9/1/18 (Ambac) | 3,115,000 | 3,115,000 | ||||
Carson Redevelopment Agency Successor Agency Tax Allocation, 4.00%, 10/1/16 | 525,000 | 526,538 | ||||
Carson Redevelopment Agency Successor Agency Tax Allocation, 4.00%, 10/1/17 | 675,000 | 699,482 | ||||
Carson Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 10/1/19 (AGM) | 315,000 | 354,233 | ||||
Chaffey Joint Union High School District GO, 5.00%, 8/1/30 | 3,125,000 | 3,850,250 | ||||
Chaffey Joint Union High School District GO, 5.00%, 8/1/32 | 1,220,000 | 1,497,733 | ||||
Chula Vista Rev., (San Diego Gas & Electric Co.), 1.65%, 7/1/18 | 8,165,000 | 8,172,838 | ||||
City & County of San Francisco COP, 5.00%, 4/1/17 | 2,440,000 | 2,503,806 | ||||
City & County of San Francisco COP, 5.00%, 10/1/19 | 2,930,000 | 3,311,222 | ||||
City & County of San Francisco COP, 5.00%, 4/1/29 | 1,170,000 | 1,291,505 | ||||
City & County of San Francisco GO, 5.00%, 6/15/25 | 1,880,000 | 2,347,180 |
17
Principal Amount | Value | |||||
Clovis Unified School District GO, Capital Appreciation, 0.00%, 8/1/24 (NATL)(1) | $ | 5,935,000 | $ | 5,142,618 | ||
Corcoran Joint Unified School District COP, VRDN, 2.70%, 12/1/21 (AGM) | 4,500,000 | 4,519,800 | ||||
Del Mar Race Track Authority Rev., 4.00%, 10/1/19 | 1,275,000 | 1,370,918 | ||||
Del Mar Race Track Authority Rev., 4.00%, 10/1/20 | 1,330,000 | 1,450,059 | ||||
East Side Union High School District GO, 5.00%, 8/1/25 | 1,405,000 | 1,696,116 | ||||
Eastern Municipal Water District COP, 5.00%, 7/1/24 | 1,000,000 | 1,077,520 | ||||
Elsinore Valley Municipal Water District COP, VRDN, 0.62%, 9/7/16 (LOC: Bank of America N.A.) | 3,000,000 | 3,000,000 | ||||
Fontana Special Tax, 4.00%, 9/1/18 | 740,000 | 787,042 | ||||
Fontana Special Tax, 4.00%, 9/1/19 | 390,000 | 424,854 | ||||
Fontana Special Tax, 5.00%, 9/1/20 | 545,000 | 626,412 | ||||
Fontana Special Tax, 5.00%, 9/1/22 | 520,000 | 625,264 | ||||
Fontana Special Tax, 5.00%, 9/1/24 | 575,000 | 713,115 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/24(5) | 1,600,000 | 1,432,640 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., 6.25%, 1/15/33 | 3,000,000 | 3,642,660 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/42(1) | 4,820,000 | 1,843,698 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., 6.00%, 1/15/49 | 3,000,000 | 3,637,590 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., VRDN, 5.00%, 1/15/18 | 3,750,000 | 3,870,825 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., VRDN, 5.00%, 1/15/20 | 5,000,000 | 5,475,000 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., VRDN, 5.50%, 1/15/23 | 2,750,000 | 3,286,277 | ||||
Garden Grove Agency Community Development Successor Agency Tax Allocation, 5.00%, 10/1/22 (BAM) | 500,000 | 610,320 | ||||
Garden Grove Agency Community Development Successor Agency Tax Allocation, 5.00%, 10/1/23 (BAM) | 500,000 | 623,840 | ||||
Golden State Tobacco Securitization Corp. Rev., 3.00%, 6/1/17 | 1,000,000 | 1,018,130 | ||||
Golden State Tobacco Securitization Corp. Rev., 4.00%, 6/1/18 | 2,885,000 | 3,050,714 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/19 | 1,000,000 | 1,113,520 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/20 | 1,000,000 | 1,151,230 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/21 | 1,000,000 | 1,179,400 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/21 | 3,000,000 | 3,559,620 | ||||
Golden State Tobacco Securitization Corp. Rev., Capital Appreciation, 0.00%, 6/1/25 (AGM)(1) | 2,000,000 | 1,705,700 | ||||
Golden State Tobacco Securitization Corp. Rev., 4.50%, 6/1/27 | 1,270,000 | 1,290,307 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/29 | 6,650,000 | 8,076,425 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/30 | 1,000,000 | 1,203,920 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/33 | 1,250,000 | 1,262,313 | ||||
Grossmont-Cuyamaca Community College District GO, 5.25%, 8/1/27 | 750,000 | 947,430 | ||||
Hayward Area Recreation and Park District COP, 5.125%, 1/1/39 | 1,750,000 | 2,072,087 | ||||
Huntington Beach Union High School District GO, 5.00%, 8/1/26 | 3,030,000 | 3,775,138 | ||||
Inland Valley Development Agency Tax Allocation, 5.25%, 9/1/37 | 1,110,000 | 1,328,481 | ||||
Inland Valley Development Agency Tax Allocation, 5.00%, 9/1/44 | 1,175,000 | 1,369,521 | ||||
Irvine Special Assessment, 2.00%, 9/2/16 | 850,000 | 850,034 |
18
Principal Amount | Value | |||||
Irvine Special Assessment, 4.00%, 9/2/17 | $ | 850,000 | $ | 877,251 | ||
Irvine Special Assessment, 4.00%, 9/2/17 | 360,000 | 372,107 | ||||
Irvine Special Assessment, 4.00%, 9/2/18 | 875,000 | 928,830 | ||||
Irvine Special Assessment, 4.00%, 9/2/19 | 1,400,000 | 1,525,216 | ||||
Irvine Special Assessment, 4.00%, 9/2/19 | 1,375,000 | 1,503,398 | ||||
Irvine Special Assessment, 5.00%, 9/2/26 | 500,000 | 639,535 | ||||
Irvine Special Assessment, VRDN, 0.58%, 9/1/16 (LOC: U.S. Bank N.A.)(4) | 7,144,000 | 7,144,000 | ||||
Irvine Special Tax, 5.00%, 9/1/39 | 1,000,000 | 1,151,550 | ||||
Irvine Unified School District Special Tax, 4.75%, 9/1/16 | 600,000 | 600,000 | ||||
Irvine Unified School District Special Tax, 5.00%, 9/1/20 | 745,000 | 764,325 | ||||
Jurupa Public Financing Authority Special Tax, 5.00%, 9/1/23 | 625,000 | 767,200 | ||||
Jurupa Public Financing Authority Special Tax, 5.00%, 9/1/24 | 680,000 | 849,483 | ||||
Jurupa Public Financing Authority Special Tax, 5.00%, 9/1/25 | 1,000,000 | 1,240,230 | ||||
Kaweah Delta Health Care District Rev., 4.00%, 6/1/45 | 5,000,000 | 5,356,250 | ||||
La Quinta Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/19 | 1,150,000 | 1,289,840 | ||||
La Quinta Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/20 | 1,045,000 | 1,207,153 | ||||
La Quinta Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/31 | 4,265,000 | 5,238,401 | ||||
La Verne COP, (Brethren Hillcrest Homes), 5.00%, 5/15/20 | 640,000 | 719,334 | ||||
La Verne COP, (Brethren Hillcrest Homes), 5.00%, 5/15/21 | 315,000 | 362,395 | ||||
La Verne COP, (Brethren Hillcrest Homes), 5.00%, 5/15/22 | 225,000 | 263,615 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/20 (AGM) | 155,000 | 178,662 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/23 (AGM) | 305,000 | 376,275 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/24 (AGM) | 330,000 | 413,648 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/25 (AGM) | 375,000 | 475,890 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/26 (AGM) | 335,000 | 430,378 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/27 (AGM) | 485,000 | 617,245 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/28 (AGM) | 300,000 | 378,765 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/29 (AGM) | 330,000 | 413,949 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/32 (AGM) | 500,000 | 618,585 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/33 (AGM) | 780,000 | 960,328 | ||||
Live Oak Elementary School District/Santa Cruz County COP, 5.00%, 8/1/39 (AGM) | 1,355,000 | 1,645,553 | ||||
Long Beach Bond Finance Authority Rev., 5.00%, 11/15/35 (GA: Merrill Lynch & Co.) | 1,215,000 | 1,590,775 | ||||
Long Beach Harbor Rev., 5.00%, 11/15/18 | 17,000,000 | 18,629,450 | ||||
Long Beach Marina System Rev., 5.00%, 5/15/40 | 2,500,000 | 2,905,425 | ||||
Long Beach Marina System Rev., 5.00%, 5/15/23 | 650,000 | 774,170 | ||||
Long Beach Marina System Rev., 5.00%, 5/15/24 | 250,000 | 302,123 | ||||
Long Beach Marina System Rev., 5.00%, 5/15/25 | 500,000 | 609,095 |
19
Principal Amount | Value | |||||
Long Beach Marina System Rev., 5.00%, 5/15/27 | $ | 800,000 | $ | 968,400 | ||
Long Beach Marina System Rev., 5.00%, 5/15/28 | 600,000 | 720,336 | ||||
Los Alamitos Unified School District COP, Capital Appreciation, 0.00%, 8/1/24(5) | 2,100,000 | 1,913,961 | ||||
Los Angeles Community College District GO, 5.00%, 8/1/17, Prerefunded at 100% of Par (NATL)(2) | 2,000,000 | 2,083,200 | ||||
Los Angeles Community College District GO, 3.00%, 8/1/19 | 2,800,000 | 2,991,884 | ||||
Los Angeles Community College District GO, 5.00%, 6/1/26 | 2,115,000 | 2,816,694 | ||||
Los Angeles County COP, 5.00%, 3/1/21 | 1,195,000 | 1,408,308 | ||||
Los Angeles County COP, 5.00%, 3/1/22 | 1,000,000 | 1,205,650 | ||||
Los Angeles County COP, 5.00%, 3/1/23 | 1,955,000 | 2,407,719 | ||||
Los Angeles County Metropolitan Transportation Authority Rev., 5.00%, 7/1/20 | 3,000,000 | 3,487,050 | ||||
Los Angeles County Metropolitan Transportation Authority Rev., 5.00%, 7/1/21 | 2,470,000 | 2,959,554 | ||||
Los Angeles County Metropolitan Transportation Authority Rev., 5.00%, 7/1/31 | 1,000,000 | 1,074,660 | ||||
Los Angeles County Redevelopment Refunding Authority Redev Agency Successor Agy Tax Allocation, 5.00%, 9/1/16 | 2,000,000 | 2,000,000 | ||||
Los Angeles County Redevelopment Refunding Authority Redev Agency Successor Agy Tax Allocation, Capital Appreciation, 0.00%, 12/1/19 (AGM)(1) | 1,500,000 | 1,435,350 | ||||
Los Angeles County Regional Financing Authority Rev., (MonteCedro, Inc.), 3.00%, 11/15/21 (California Mortgage Insurance) | 810,000 | 811,588 | ||||
Los Angeles County Sanitation Districts Financing Authority Rev., 5.00%, 10/1/23 | 2,855,000 | 3,588,478 | ||||
Los Angeles County Sanitation Districts Financing Authority Rev., 5.00%, 10/1/26 | 2,700,000 | 3,488,373 | ||||
Los Angeles Department of Airports Rev., 5.00%, 5/15/18 | 750,000 | 806,543 | ||||
Los Angeles Department of Airports Rev., 5.00%, 5/15/24 | 3,040,000 | 3,498,067 | ||||
Los Angeles Department of Airports Rev., 5.00%, 5/15/26 | 1,500,000 | 1,923,300 | ||||
Los Angeles Department of Airports Rev., 5.00%, 5/15/27 | 1,280,000 | 1,630,874 | ||||
Los Angeles Department of Airports Rev., 5.00%, 5/15/40 | 3,000,000 | 3,410,670 | ||||
Los Angeles Department of Water Rev., 5.00%, 7/1/24 | 1,500,000 | 1,829,175 | ||||
Los Angeles Department of Water & Power Rev., 5.00%, 7/1/18 | 780,000 | 842,923 | ||||
Los Angeles Department of Water & Power Rev., 5.00%, 7/1/26 | 1,000,000 | 1,214,090 | ||||
Los Angeles Department of Water & Power Rev., 5.00%, 7/1/26 | 1,300,000 | 1,650,493 | ||||
Los Angeles Department of Water & Power Rev., 5.00%, 7/1/27 | 6,470,000 | 8,066,343 | ||||
Los Angeles Department of Water & Power Rev., 5.25%, 7/1/32 | 3,535,000 | 3,840,707 | ||||
Los Angeles Department of Water & Power Rev., 5.25%, 7/1/38 | 5,000,000 | 5,405,550 | ||||
Los Angeles Department of Water & Power Rev., VRDN, 0.54%, 9/1/16 (SBBPA: Citibank N.A.) | 19,500,000 | 19,500,000 | ||||
Los Angeles Unified School District COP, 5.00%, 10/1/29 | 1,700,000 | 2,030,769 | ||||
Los Angeles Unified School District GO, 4.00%, 7/1/17 | 1,000,000 | 1,029,570 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/17, Prerefunded at 100% of Par (AGM)(2) | 2,000,000 | 2,075,680 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/18 | 2,565,000 | 2,773,894 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/18 | 6,665,000 | 7,207,798 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/21 | 3,000,000 | 3,599,340 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/24 | 5,140,000 | 6,131,866 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/24 | 5,000,000 | 6,433,700 |
20
Principal Amount | Value | |||||
Los Angeles Unified School District GO, 5.00%, 7/1/26 | $ | 3,555,000 | $ | 4,533,158 | ||
Los Angeles Unified School District GO, 5.25%, 7/1/26 | 3,000,000 | 3,470,940 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/27 | 1,050,000 | 1,331,285 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/29 | 4,000,000 | 4,477,480 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/30 | 1,155,000 | 1,442,052 | ||||
Los Angeles Wastewater System Rev., 5.75%, 6/1/34 | 1,325,000 | 1,507,413 | ||||
M-S-R Energy Authority Rev., 7.00%, 11/1/34 (GA: Citigroup, Inc.) | 5,000,000 | 7,665,400 | ||||
M-S-R Energy Authority Rev., 6.50%, 11/1/39 (GA: Citigroup, Inc.) | 1,000,000 | 1,492,090 | ||||
Menlo Park Community Development Agency Successor Agency Tax Allocation, 3.00%, 10/1/17 | 650,000 | 666,998 | ||||
Menlo Park Community Development Agency Successor Agency Tax Allocation, 4.00%, 10/1/18 | 885,000 | 944,437 | ||||
Menlo Park Community Development Agency Successor Agency Tax Allocation, 5.00%, 10/1/19 | 420,000 | 473,000 | ||||
Menlo Park Community Development Agency Successor Agency Tax Allocation, 5.00%, 10/1/20 | 325,000 | 377,910 | ||||
Metropolitan Water District of Southern California Rev., VRDN, 0.94%, 9/1/16 | 9,935,000 | 9,927,648 | ||||
Milpitas Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/25 | 2,325,000 | 2,985,881 | ||||
Milpitas Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/26 | 6,285,000 | 7,987,041 | ||||
Mount San Antonio Community College District GO, 5.00%, 8/1/34 | 2,000,000 | 2,440,620 | ||||
Municipal Improvement Corp. of Los Angeles Rev., 5.00%, 3/1/25 | 3,000,000 | 3,587,400 | ||||
Municipal Improvement Corp. of Los Angeles Rev., 4.00%, 11/1/34 | 1,800,000 | 2,032,398 | ||||
Municipal Improvement Corp. of Los Angeles Rev., 4.00%, 11/1/35 | 2,250,000 | 2,523,352 | ||||
Murrieta Financing Authority Special Tax, 5.00%, 9/1/17 | 1,000,000 | 1,040,210 | ||||
Murrieta Financing Authority Special Tax, 5.00%, 9/1/21 | 1,200,000 | 1,403,664 | ||||
Natomas Unified School District GO, 5.00%, 9/1/26 (BAM) | 1,785,000 | 2,205,796 | ||||
Newark Unified School District GO, 5.00%, 8/1/44 | 6,030,000 | 7,333,565 | ||||
Newport Beach Rev., (Hoag Memorial Hospital/Newport Healthcare Obligated Group), 6.00%, 12/1/21, Prerefunded at 100% of Par(2) | 1,000,000 | 1,259,850 | ||||
North Lake Tahoe Public Financing Authority Rev., 4.00%, 12/1/19 | 1,000,000 | 1,103,290 | ||||
Northern California Power Agency Rev., 5.00%, 8/1/19 | 2,000,000 | 2,227,240 | ||||
Northern California Power Agency Rev., 5.00%, 8/1/20 | 1,515,000 | 1,724,797 | ||||
Northern California Power Agency Rev., 5.00%, 8/1/21 | 2,050,000 | 2,331,649 | ||||
Northern California Power Agency Rev., 5.25%, 8/1/22 | 4,250,000 | 4,866,505 | ||||
Northern California Power Agency Rev., 5.00%, 7/1/26 | 1,750,000 | 2,104,952 | ||||
Northern California Power Agency Rev., 5.00%, 7/1/27 | 2,000,000 | 2,399,460 | ||||
Northern California Transmission Agency Rev., 5.00%, 5/1/21 | 800,000 | 955,904 | ||||
Northern California Transmission Agency Rev., 5.00%, 5/1/28 | 1,000,000 | 1,297,840 | ||||
Northern California Transmission Agency Rev., 5.00%, 5/1/29 | 1,000,000 | 1,285,140 | ||||
Northern California Transmission Agency Rev., 5.00%, 5/1/30 | 1,855,000 | 2,368,112 | ||||
Oakland Alameda County Coliseum Authority Rev., 5.00%, 2/1/18 | 3,345,000 | 3,547,874 | ||||
Oakland Alameda County Coliseum Authority Rev., 5.00%, 2/1/25 | 4,065,000 | 4,782,554 | ||||
Oakland Sewer Rev., 5.00%, 6/15/26 | 1,200,000 | 1,525,188 | ||||
Oakland State Building Authority Rev., 5.00%, 12/1/19 | 2,445,000 | 2,772,483 | ||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/20 | 1,670,000 | 1,932,724 | ||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/21 | 610,000 | 723,436 | ||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/22 | 750,000 | 876,413 |
21
Principal Amount | Value | |||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/22 | $ | 500,000 | $ | 603,075 | ||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/23 | 1,400,000 | 1,723,022 | ||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/25 | 650,000 | 827,957 | ||||
Oakland Unified School District/Alameda County GO, 5.50%, 8/1/32 | 2,150,000 | 2,621,430 | ||||
Oakland Unified School District/Alameda County GO, 6.625%, 8/1/38 | 1,410,000 | 1,777,728 | ||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/40 | 950,000 | 1,157,414 | ||||
Ontario Public Financing Authority Rev., 5.00%, 7/1/43 | 2,000,000 | 2,419,740 | ||||
Orange County Special Assessment, 4.55%, 9/2/16 | 210,000 | 210,027 | ||||
Orange County Community Facilities District Special Tax, 5.00%, 8/15/28 | 1,960,000 | 2,318,170 | ||||
Orange County Sanitation District COP, 5.00%, 2/1/17, Prerefunded at 100% of Par (AGM)(2) | 2,750,000 | 2,801,260 | ||||
Orange County Sanitation District Rev., 4.00%, 11/15/16 | 6,500,000 | 6,539,000 | ||||
Orange County Transportation Authority Rev., 5.00%, 8/15/24 | 1,000,000 | 1,246,540 | ||||
Oxnard Financing Authority Rev., 5.00%, 6/1/25 (AGM) | 2,000,000 | 2,499,140 | ||||
Oxnard Financing Authority Rev., 5.00%, 6/1/26 (AGM) | 3,690,000 | 4,587,814 | ||||
Oxnard Financing Authority Rev., 5.00%, 6/1/28 (AGM) | 1,515,000 | 1,863,056 | ||||
Oxnard Financing Authority Rev., 5.00%, 6/1/32 (AGM) | 1,000,000 | 1,207,180 | ||||
Oxnard School District GO, 3.00%, 8/1/20 (AGM)(5) | 2,800,000 | 2,998,464 | ||||
Palm Springs Financing Authority Rev., 5.00%, 6/1/23 | 1,230,000 | 1,476,431 | ||||
Palmdale Community Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/28 (NATL) | 2,150,000 | 2,733,445 | ||||
Palmdale Community Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/29 (NATL) | 2,075,000 | 2,618,774 | ||||
Palmdale Community Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/30 (NATL) | 1,215,000 | 1,526,332 | ||||
Palomar Health COP, 5.25%, 11/1/21 | 880,000 | 960,758 | ||||
Palomar Health COP, 6.00%, 11/1/41 | 1,120,000 | 1,205,344 | ||||
Palomar Health GO, Capital Appreciation, 0.00%, 8/1/18 (NATL)(1) | 3,615,000 | 3,535,723 | ||||
Palomar Health GO, Capital Appreciation, 0.00%, 8/1/19 (AGC)(5) | 1,660,000 | 2,046,979 | ||||
Peralta Community College District GO, 5.00%, 8/1/17 | 2,085,000 | 2,170,464 | ||||
Peralta Community College District GO, 5.00%, 8/1/22 | 2,145,000 | 2,633,953 | ||||
Pittsburg Successor Agency Redevelopment Agency Tax Allocation, 5.00%, 9/1/29 (AGM) | 3,000,000 | 3,734,070 | ||||
Pomona Public Financing Authority Rev., 3.00%, 6/1/23 (AGM)(3) | 500,000 | 546,110 | ||||
Pomona Public Financing Authority Rev., 4.00%, 6/1/24 (AGM)(3) | 225,000 | 263,774 | ||||
Pomona Public Financing Authority Rev., 4.00%, 6/1/25 (AGM)(3) | 275,000 | 324,668 | ||||
Pomona Public Financing Authority Rev., 4.00%, 6/1/26 (AGM)(3) | 275,000 | 325,947 | ||||
Pomona Public Financing Authority Rev., 4.00%, 6/1/27 (AGM)(3) | 250,000 | 294,270 | ||||
Pomona Public Financing Authority Rev., 4.00%, 6/1/28 (AGM)(3) | 275,000 | 320,477 | ||||
Pomona Public Financing Authority Rev., 4.00%, 6/1/29 (AGM)(3) | 275,000 | 317,339 | ||||
Port of Oakland Rev., 5.00%, 11/1/16 (NATL) | 1,270,000 | 1,279,792 | ||||
Port of Oakland Rev., 5.00%, 11/1/17 (NATL) | 2,375,000 | 2,497,716 | ||||
Porterville Public Financing Authority Rev., 5.625%, 10/1/36 | 2,500,000 | 3,000,175 | ||||
Poway Unified School District GO, Capital Appreciation, 0.00%, 8/1/41(1) | 2,780,000 | 1,294,563 | ||||
Poway Unified School District Special Tax, 5.00%, 9/15/17, Prerefunded at 100% of Par (Ambac)(2) | 1,150,000 | 1,203,809 | ||||
Poway Unified School District Special Tax, 5.00%, 9/15/17, Prerefunded at 100% of Par (Ambac)(2) | 1,205,000 | 1,261,382 |
22
Principal Amount | Value | |||||
Poway Unified School District Public Financing Authority Special Tax, 2.00%, 9/1/16 | $ | 1,285,000 | $ | 1,285,000 | ||
Poway Unified School District Public Financing Authority Special Tax, 3.00%, 9/1/17 | 670,000 | 685,457 | ||||
Rancho Mirage Joint Powers Financing Authority Rev., (Eisenhower Medical Center), 5.00%, 7/1/21 | 1,000,000 | 1,035,100 | ||||
Rancho Santa Fe Community Services District Special Tax, 5.125%, 9/1/21, Prerefunded at 100% of Par(2) | 790,000 | 954,186 | ||||
Rancho Santa Fe Community Services District Special Tax, 5.25%, 9/1/21, Prerefunded at 100% of Par(2) | 1,300,000 | 1,578,109 | ||||
Rancho Santa Fe Community Services District Special Tax, 5.375%, 9/1/21, Prerefunded at 100% of Par(2) | 1,410,000 | 1,720,242 | ||||
Regents of the University of California Medical Center Pooled Rev., 5.00%, 5/15/21 | 5,000,000 | 5,959,050 | ||||
Regents of the University of California Medical Center Pooled Rev., 5.00%, 5/15/22 | 4,000,000 | 4,881,600 | ||||
Rio Elementary School District Community Facilities District Special Tax, 5.00%, 9/1/24 | 700,000 | 856,450 | ||||
Riverside County Asset Leasing Corp. Rev., 5.00%, 11/1/43 | 1,000,000 | 1,168,790 | ||||
Riverside County Redevelopment Successor Agency Tax Allocation, 6.50%, 10/1/40 | 935,000 | 1,123,487 | ||||
Riverside County Transportation Commission Rev., Capital Appreciation, 0.00%, 6/1/28(1) | 1,000,000 | 653,640 | ||||
Riverside County Transportation Commission Rev., Capital Appreciation, 0.00%, 6/1/30(1) | 1,000,000 | 597,630 | ||||
Riverside County Transportation Commission Rev., 5.25%, 6/1/39 | 1,335,000 | 1,648,445 | ||||
Riverside Sewer Rev., 5.00%, 8/1/25 | 1,630,000 | 2,085,308 | ||||
Riverside Sewer Rev., 5.00%, 8/1/26 | 3,400,000 | 4,309,636 | ||||
Roseville Water Utility Rev. COP, 5.00%, 12/1/26 | 1,690,000 | 2,183,294 | ||||
Roseville Water Utility Rev. COP, 5.00%, 12/1/27 | 2,250,000 | 2,886,502 | ||||
Sacramento City Financing Authority Rev., 5.40%, 11/1/20 (Ambac) | 2,145,000 | 2,340,710 | ||||
Sacramento County Airport System Rev., 5.00%, 7/1/20 | 1,000,000 | 1,143,550 | ||||
Sacramento County Airport System Rev., 5.00%, 7/1/23 | 1,000,000 | 1,129,100 | ||||
Sacramento County Airport System Rev., 5.00%, 7/1/24 | 1,000,000 | 1,141,130 | ||||
Sacramento County Sanitation Districts Financing Authority Rev., 5.25%, 12/1/21 (NATL) | 1,000,000 | 1,223,800 | ||||
Sacramento County Sanitation Districts Financing Authority Rev., VRN, 0.98%, 9/1/16 (NATL) | 2,500,000 | 2,373,375 | ||||
Sacramento Municipal Utility District Rev., 3.00%, 7/1/17 | 10,000,000 | 10,208,400 | ||||
Sacramento Municipal Utility District Rev., 5.70%, 7/1/17 (Ambac) | 3,105,000 | 3,239,353 | ||||
Sacramento Municipal Utility District Rev., 4.00%, 7/1/18 | 6,000,000 | 6,375,900 | ||||
Sacramento Municipal Utility District Rev., 5.25%, 7/1/24 (Ambac) | 3,000,000 | 3,695,550 | ||||
Sacramento Municipal Utility District Rev., 5.00%, 8/15/24 | 1,500,000 | 1,834,785 | ||||
Sacramento Municipal Utility District Rev., 5.00%, 8/15/25 | 5,000,000 | 6,107,500 | ||||
Sacramento Municipal Utility District Rev., 5.00%, 8/15/27 | 3,150,000 | 4,194,382 | ||||
Sacramento Municipal Utility District Rev., 5.00%, 8/15/28 | 1,200,000 | 1,615,824 | ||||
Sacramento Redevelopment Agency Successor Agency Tax Allocation, 4.00%, 12/1/18 | 2,000,000 | 2,139,380 | ||||
Sacramento Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 12/1/34 (BAM) | 970,000 | 1,172,691 | ||||
Sacramento Regional Transit District Rev., 4.00%, 3/1/17 | 1,000,000 | 1,015,550 | ||||
Sacramento Regional Transit District Rev., 5.00%, 3/1/18 | 250,000 | 265,073 | ||||
Salinas Union High School District GO, 0.00%, 8/1/20(1) | 5,000,000 | 4,705,100 |
23
Principal Amount | Value | |||||
San Bernardino Community College District GO, 5.25%, 8/1/18 | $ | 350,000 | $ | 380,930 | ||
San Bernardino Community College District GO, 5.50%, 8/1/18, Prerefunded at 100% of Par(2) | 300,000 | 328,191 | ||||
San Bernardino Community College District GO, 6.25%, 8/1/18, Prerefunded at 100% of Par(2) | 8,000,000 | 8,866,000 | ||||
San Bernardino Community College District GO, Capital Appreciation, 0.00%, 8/1/19(5) | 9,840,000 | 11,005,942 | ||||
San Bernardino County Rev., (WLP Parkview Place Apartments LLC), VRDN, 0.63%, 9/1/16 (LIQ FAC: FNMA) | 1,120,000 | 1,120,000 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 3.00%, 12/1/18 (AGM) | 1,725,000 | 1,806,868 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 4.00%, 12/1/19 (AGM) | 2,665,000 | 2,927,636 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 12/1/20 (AGM) | 2,915,000 | 3,388,221 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 12/1/22 (AGM) | 2,310,000 | 2,803,116 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 12/1/24 (AGM) | 2,310,000 | 2,911,801 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 12/1/25 (AGM) | 1,275,000 | 1,626,900 | ||||
San Buenaventura Rev., (Community Memorial Health System), 8.00%, 12/1/26 | 2,000,000 | 2,629,200 | ||||
San Buenaventura Rev., (Community Memorial Health System), 7.50%, 12/1/41 | 1,200,000 | 1,493,760 | ||||
San Diego Community College District GO, 5.00%, 8/1/30 | 3,000,000 | 3,707,340 | ||||
San Diego Convention Center Expansion Financing Authority Rev., 4.00%, 4/15/17 | 1,250,000 | 1,276,325 | ||||
San Diego Convention Center Expansion Financing Authority Rev., 4.00%, 4/15/18 | 1,160,000 | 1,220,413 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 4.00%, 11/1/17 | 300,000 | 311,676 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/18 | 300,000 | 327,357 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/19 | 300,000 | 338,661 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/22 | 1,525,000 | 1,859,798 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/30 | 450,000 | 561,051 | ||||
San Diego County Regional Airport Authority Rev., 4.00%, 7/1/18 | 300,000 | 318,966 | ||||
San Diego County Regional Airport Authority Rev., 4.00%, 7/1/19 | 400,000 | 437,084 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/19 | 1,290,000 | 1,439,163 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/21 | 2,000,000 | 2,310,740 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/34 | 750,000 | 850,868 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/40 | 740,000 | 839,523 | ||||
San Diego County Regional Transportation Commission Rev., 5.00%, 4/1/21 | 5,940,000 | 7,090,162 | ||||
San Diego County Water Authority Financing Corp. Rev., 5.00%, 5/1/25 | 5,250,000 | 6,843,952 | ||||
San Diego County Water Authority Financing Corp. Rev., 5.00%, 5/1/26 | 2,390,000 | 3,108,816 | ||||
San Diego County Water Authority Financing Corp. Rev., 5.00%, 5/1/27 | 3,485,000 | 4,495,720 | ||||
San Diego Public Facilities Financing Authority Rev., 5.00%, 10/15/44 | 3,970,000 | 4,865,711 |
24
Principal Amount | Value | |||||
San Diego Public Facilities Financing Authority Tax Allocation, 5.125%, 10/1/22 (AGC) | $ | 1,230,000 | $ | 1,276,605 | ||
San Diego Public Facilities Financing Authority Sewer Rev., 5.00%, 5/15/19, Prerefunded at 100% of Par(2) | 3,680,000 | 4,113,872 | ||||
San Diego Public Facilities Financing Authority Sewer Rev., 5.25%, 5/15/20, Prerefunded at 100% of Par(2) | 3,400,000 | 3,964,536 | ||||
San Diego Public Facilities Financing Authority Water Rev., 5.00%, 8/1/18, Prerefunded at 100% of Par(2) | 1,000,000 | 1,083,650 | ||||
San Diego Public Facilities Financing Authority Water Rev., 5.00%, 8/1/21 | 2,000,000 | 2,405,040 | ||||
San Diego Public Facilities Financing Authority Water Rev., 5.00%, 8/1/24 | 2,000,000 | 2,440,700 | ||||
San Diego Public Facilities Financing Authority Water Rev., 5.00%, 8/1/28 | 10,000,000 | 12,947,700 | ||||
San Diego Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/22 | 1,000,000 | 1,225,190 | ||||
San Diego Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/23 | 1,000,000 | 1,252,370 | ||||
San Diego Unified Port District Rev., 5.00%, 9/1/23 | 250,000 | 306,880 | ||||
San Diego Unified Port District Rev., 5.00%, 9/1/26 | 750,000 | 909,008 | ||||
San Diego Unified School District GO, 5.00%, 7/1/28 | 5,000,000 | 6,406,950 | ||||
San Diego Unified School District GO, Capital Appreciation, 0.00%, 7/1/36(1) | 7,895,000 | 4,352,592 | ||||
San Francisco Bay Area Rapid Transit District Rev., 5.00%, 7/1/28 | 1,500,000 | 1,931,370 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.00%, 5/1/17 (AGC) | 3,375,000 | 3,478,545 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.00%, 5/1/18 (AGC) | 2,000,000 | 2,149,880 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.00%, 5/1/19 | 1,500,000 | 1,674,330 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.25%, 5/1/23 | 3,500,000 | 3,913,385 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 4.00%, 5/1/24 | 1,625,000 | 1,902,420 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.00%, 5/1/24 | 4,025,000 | 4,767,411 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.00%, 5/1/26 | 1,250,000 | 1,505,663 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.00%, 5/1/29 | 6,270,000 | 7,391,954 | ||||
San Francisco City & County Public Utilities Commission Wastewater Rev., 5.00%, 10/1/21 | 5,000,000 | 6,034,300 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/17(2) | 465,000 | 484,125 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.50%, 8/1/18(2) | 485,000 | 530,187 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 6.00%, 8/1/19(2) | 510,000 | 588,402 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 6.00%, 8/1/20(2) | 515,000 | 618,824 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/21 | 460,000 | 545,542 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/26 | 425,000 | 524,191 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/27 | 550,000 | 673,178 |
25
Principal Amount | Value | |||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/28 | $ | 370,000 | $ | 449,106 | ||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/43 | 1,000,000 | 1,177,750 | ||||
San Francisco Public Utilities Commission Water Rev., 5.00%, 11/1/28 | 2,780,000 | 3,185,129 | ||||
San Francisco Public Utilities Commission Water Rev., 5.00%, 11/1/28 | 1,055,000 | 1,351,044 | ||||
San Francisco Public Utilities Commission Water Rev., 5.00%, 11/1/35 | 1,415,000 | 1,741,087 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/1/17(1)(2) | 1,000,000 | 998,120 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., 5.00%, 1/15/34 | 9,000,000 | 10,578,420 | ||||
San Jose Airport Rev., 5.00%, 3/1/27 | 1,295,000 | 1,599,726 | ||||
San Jose Airport Rev., 5.00%, 3/1/28 | 1,500,000 | 1,846,395 | ||||
San Jose Airport Rev., 5.00%, 3/1/30 | 1,750,000 | 2,139,865 | ||||
San Jose Airport Rev., 5.00%, 3/1/31 | 1,000,000 | 1,219,650 | ||||
San Jose Unified School District GO, 5.00%, 8/1/17 | 1,160,000 | 1,208,755 | ||||
San Jose Unified School District GO, 5.00%, 8/1/17 | 900,000 | 937,827 | ||||
San Jose Unified School District GO, 5.00%, 8/1/18 | 2,100,000 | 2,280,999 | ||||
San Jose Unified School District GO, 5.00%, 8/1/19 | 1,000,000 | 1,128,420 | ||||
San Mateo Special Tax, 5.875%, 9/1/32 | 690,000 | 815,835 | ||||
San Mateo County Transit District Rev., 5.25%, 6/1/18 (NATL)(2) | 2,680,000 | 2,899,385 | ||||
San Mateo Joint Powers Financing Authority Rev., 5.00%, 6/15/17 | 860,000 | 890,693 | ||||
San Mateo Joint Powers Financing Authority Rev., 5.00%, 6/15/18 | 1,000,000 | 1,078,960 | ||||
Santa Clara County Financing Authority Rev., 4.00%, 2/1/17 | 2,055,000 | 2,085,188 | ||||
Santa Clara Electric Rev., 5.00%, 7/1/30 | 1,000,000 | 1,166,130 | ||||
Santa Clara Valley Transportation Authority Rev., 5.00%, 4/1/20 | 4,000,000 | 4,609,880 | ||||
Santa Monica Redevelopment Agency Tax Allocation, 5.00%, 7/1/42 | 600,000 | 696,024 | ||||
Santa Monica Redevelopment Agency Tax Allocation, 5.875%, 7/1/42 | 600,000 | 721,620 | ||||
Santa Monica-Malibu Unified School District GO, 5.00%, 7/1/17 | 3,375,000 | 3,501,697 | ||||
Santa Rosa Wastewater Rev., Capital Appreciation, 0.00%, 9/1/24 (Ambac)(1) | 7,000,000 | 6,062,630 | ||||
Silicon Valley Clean Water Rev., 5.00%, 8/1/40 | 2,340,000 | 2,891,304 | ||||
Simi Valley Unified School District GO, 5.00%, 8/1/26(3) | 1,990,000 | 2,494,166 | ||||
Simi Valley Unified School District GO, 5.00%, 8/1/27(3) | 1,500,000 | 1,896,735 | ||||
Sonoma Community Development Agency Successor Agency Tax Allocation, 5.00%, 6/1/23 (NATL) | 1,000,000 | 1,233,870 | ||||
Sonoma Community Development Agency Successor Agency Tax Allocation, 5.00%, 6/1/25 (NATL) | 1,390,000 | 1,773,459 | ||||
Sonoma Community Development Agency Successor Agency Tax Allocation, 5.00%, 6/1/29 (NATL) | 1,100,000 | 1,386,451 | ||||
South Orange County Public Financing Authority Rev., 4.25%, 6/1/17 | 2,000,000 | 2,055,960 | ||||
South Orange County Public Financing Authority Rev., 4.50%, 6/1/18 | 2,700,000 | 2,881,305 | ||||
South Placer Wastewater Authority Rev., VRN, 0.89%, 9/1/16 | 4,400,000 | 4,383,280 | ||||
Southern California Public Power Authority Rev., 5.00%, 7/1/18 | 1,880,000 | 2,032,017 | ||||
Southern California Public Power Authority Rev., 5.00%, 7/1/18 | 2,000,000 | 2,161,720 | ||||
Southern California Public Power Authority Rev., 6.00%, 7/1/18, Prerefunded at 100% of Par(2) | 2,000,000 | 2,198,740 |
26
Principal Amount | Value | |||||
Southern California Public Power Authority Rev., 5.00%, 7/1/20 | $ | 4,000,000 | $ | 4,649,400 | ||
Southern California Public Power Authority Rev., 5.00%, 7/1/21 | 2,780,000 | 3,335,388 | ||||
Southern California Public Power Authority Rev., 5.00%, 7/1/22 | 2,875,000 | 3,103,907 | ||||
Southern California Water Replenishment District Rev., 5.00%, 8/1/21 | 1,000,000 | 1,201,280 | ||||
Southwestern Community College District GO, Capital Appreciation, 0.00%, 8/1/46(1) | 15,530,000 | 5,704,324 | ||||
State of California GO, 5.00%, 11/1/16 (Ambac) | 1,575,000 | 1,587,128 | ||||
State of California GO, 5.00%, 9/1/17 | 2,500,000 | 2,612,600 | ||||
State of California GO, 5.00%, 10/1/17 | 2,170,000 | 2,275,722 | ||||
State of California GO, 5.50%, 4/1/18 | 2,535,000 | 2,732,122 | ||||
State of California GO, 5.00%, 7/1/18(2) | 5,435,000 | 5,876,050 | ||||
State of California GO, 5.00%, 7/1/18(2) | 1,565,000 | 1,692,000 | ||||
State of California GO, 5.00%, 8/1/18 | 2,260,000 | 2,301,968 | ||||
State of California GO, 5.00%, 9/1/18 | 1,000,000 | 1,087,480 | ||||
State of California GO, 5.00%, 7/1/19(2) | 4,505,000 | 5,063,034 | ||||
State of California GO, 5.00%, 9/1/19 | 7,645,000 | 8,621,649 | ||||
State of California GO, 5.00%, 3/1/20 | 1,690,000 | 1,797,061 | ||||
State of California GO, 5.00%, 8/1/20 | 5,000,000 | 5,092,650 | ||||
State of California GO, 5.25%, 10/1/20 | 5,000,000 | 5,704,250 | ||||
State of California GO, 5.00%, 9/1/22 | 2,000,000 | 2,448,200 | ||||
State of California GO, 5.00%, 3/1/23 | 10,000,000 | 12,361,300 | ||||
State of California GO, 5.50%, 4/1/24 | 4,600,000 | 5,166,812 | ||||
State of California GO, 5.00%, 8/1/24 | 1,260,000 | 1,283,134 | ||||
State of California GO, 5.00%, 8/1/26 | 4,800,000 | 6,208,032 | ||||
State of California GO, 5.00%, 12/1/26 | 1,045,000 | 1,313,858 | ||||
State of California GO, 5.00%, 2/1/27 | 14,000,000 | 17,166,800 | ||||
State of California GO, 5.00%, 2/1/28 | 5,795,000 | 7,092,848 | ||||
State of California GO, 5.00%, 3/1/28 | 8,000,000 | 10,131,920 | ||||
State of California GO, 5.75%, 4/1/28 | 5,000,000 | 5,638,400 | ||||
State of California GO, 5.00%, 11/1/29 | 2,625,000 | 3,256,732 | ||||
State of California GO, 5.00%, 9/1/30(3) | 10,000,000 | 12,750,500 | ||||
State of California GO, 5.75%, 4/1/31 | 5,000,000 | 5,630,150 | ||||
State of California GO, 5.00%, 11/1/32 | 1,890,000 | 1,983,328 | ||||
State of California GO, 6.50%, 4/1/33 | 5,000,000 | 5,738,000 | ||||
State of California GO, 6.00%, 4/1/38 | 3,000,000 | 3,400,350 | ||||
State of California GO, 5.00%, 8/1/45 | 5,000,000 | 6,214,750 | ||||
State of California GO, VRDN, 4.00%, 12/1/21 | 4,000,000 | 4,551,560 | ||||
State of California GO, VRN, 1.46%, 9/1/16 | 2,000,000 | 2,010,000 | ||||
State of California GO, VRN, 1.56%, 9/1/16 | 800,000 | 806,024 | ||||
State of California GO, VRN, 1.71%, 9/1/16 | 960,000 | 973,651 | ||||
State of California Department of Water Resources Rev., 5.00%, 12/1/19, Prerefunded at 100% of Par(2) | 905,000 | 1,031,012 | ||||
State of California Department of Water Resources Rev., VRDN, 0.86%, 9/1/16 | 4,500,000 | 4,487,265 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/17 | 5,000,000 | 5,150,450 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/18 | 3,000,000 | 3,220,830 |
27
Principal Amount | Value | |||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/19 | $ | 7,000,000 | $ | 7,810,250 | ||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/20 | 14,215,000 | 16,440,643 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/20, Prerefunded at 100% of Par(2) | 1,860,000 | 2,150,365 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/20, Prerefunded at 100% of Par(2) | 8,000,000 | 9,248,880 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/21 | 1,430,000 | 1,533,689 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/21 | 10,000,000 | 11,953,900 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/21 | 1,140,000 | 1,310,134 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/22 | 1,800,000 | 1,930,194 | ||||
State of California Department of Water Resources Power Supply Rev., 5.00%, 5/1/22 | 6,835,000 | 7,844,393 | ||||
Stockton Public Financing Authority Rev., 5.00%, 9/1/22 (BAM) | 1,410,000 | 1,705,339 | ||||
Stockton Public Financing Authority Rev., 5.00%, 9/1/23 (BAM) | 1,435,000 | 1,771,134 | ||||
Stockton Public Financing Authority Rev., 5.00%, 9/1/24 (BAM) | 1,090,000 | 1,370,348 | ||||
Stockton Public Financing Authority Rev., 5.00%, 9/1/25 (BAM) | 2,255,000 | 2,830,499 | ||||
Stockton Public Financing Authority Rev., 5.00%, 9/1/26 (BAM) | 1,495,000 | 1,867,195 | ||||
Stockton Public Financing Authority Rev., 6.25%, 10/1/38 | 1,500,000 | 1,897,530 | ||||
Stockton Public Financing Authority Special Tax, 4.00%, 9/2/20 (BAM) | 575,000 | 639,636 | ||||
Stockton Public Financing Authority Special Tax, 4.00%, 9/2/21 (BAM) | 450,000 | 509,270 | ||||
Stockton Public Financing Authority Special Tax, 4.00%, 9/2/22 (BAM) | 940,000 | 1,074,777 | ||||
Stockton Public Financing Authority Special Tax, 4.00%, 9/2/23 (BAM) | 655,000 | 757,946 | ||||
Stockton Unified School District GO, 5.00%, 8/1/27 (AGM) | 530,000 | 657,481 | ||||
Stockton Unified School District GO, 5.00%, 8/1/28 (AGM) | 255,000 | 314,512 | ||||
Stockton Unified School District GO, 5.00%, 8/1/30 | 11,165,000 | 13,864,250 | ||||
Stockton Unified School District GO, 5.00%, 8/1/42 (AGM) | 865,000 | 1,029,696 | ||||
Sutter Union High School District GO, Capital Appreciation, 0.00%, 8/1/48 (BAM)(1) | 2,470,000 | 703,728 | ||||
Temecula Valley Unified School District Financing Authority Special Tax, 4.00%, 9/1/17 (BAM) | 415,000 | 428,678 | ||||
Temecula Valley Unified School District Financing Authority Special Tax, 5.00%, 9/1/18 (BAM) | 325,000 | 351,826 | ||||
Temecula Valley Unified School District Financing Authority Special Tax, 5.00%, 9/1/19 (BAM) | 265,000 | 297,086 | ||||
Temecula Valley Unified School District Financing Authority Special Tax, 5.00%, 9/1/20 (BAM) | 400,000 | 462,180 | ||||
Temecula Valley Unified School District Financing Authority Special Tax, 5.00%, 9/1/21 (BAM) | 515,000 | 612,350 | ||||
Temecula Valley Unified School District Financing Authority Special Tax, 5.00%, 9/1/22 (BAM) | 275,000 | 332,426 | ||||
Tobacco Securitization Authority of Southern California Rev., (San Diego County Tobacco Asset Securitization Corp.), 5.00%, 6/1/37 | 1,750,000 | 1,750,140 | ||||
Town of Hillsborough COP, VRDN, 0.64%, 9/1/16 (SBBPA: Bank of the West) | 1,200,000 | 1,200,000 | ||||
Tuolumne Wind Project Authority Rev., 5.625%, 1/1/29 | 1,000,000 | 1,108,110 | ||||
Tustin Community Facilities District Special Tax, 5.00%, 9/1/22 | 480,000 | 570,288 | ||||
Tustin Community Facilities District Special Tax, 5.00%, 9/1/23 | 725,000 | 878,178 |
28
Principal Amount | Value | |||||
Tustin Community Facilities District Special Tax, 5.00%, 9/1/28 | $ | 1,000,000 | $ | 1,224,430 | ||
Tustin Community Facilities District Special Tax, 5.00%, 9/1/30 | 1,000,000 | 1,215,650 | ||||
Twin Rivers Unified School District COP, VRDN, 3.45%, 7/1/18 (AGM) | 3,000,000 | 3,005,640 | ||||
Twin Rivers Unified School District COP, VRDN, 3.20%, 6/1/20 (AGM) | 3,750,000 | 3,756,825 | ||||
Twin Rivers Unified School District COP, VRDN, 3.20%, 6/1/20 (AGM) | 2,500,000 | 2,504,550 | ||||
University of California Rev., 5.25%, 5/15/17, Prerefunded at 101% of Par(2) | 1,910,000 | 1,992,913 | ||||
University of California Rev., 5.00%, 5/15/18, Prerefunded at 101% of Par(2) | 760,000 | 824,684 | ||||
University of California Rev., 5.25%, 5/15/19, Prerefunded at 100% of Par(2) | 2,210,000 | 2,485,366 | ||||
University of California Rev., 5.25%, 5/15/19, Prerefunded at 100% of Par(2) | 4,285,000 | 4,818,911 | ||||
University of California Rev., 5.25%, 5/15/19, Prerefunded at 100% of Par(2) | 1,255,000 | 1,411,373 | ||||
University of California Rev., 5.00%, 5/15/20 | 1,405,000 | 1,523,357 | ||||
University of California Rev., 5.25%, 5/15/23 | 90,000 | 93,897 | ||||
University of California Rev., 5.00%, 5/15/25 | 7,250,000 | 9,030,382 | ||||
University of California Rev., 5.00%, 5/15/26 | 11,300,000 | 14,666,496 | ||||
University of California Rev., 5.00%, 5/15/26 | 6,150,000 | 7,434,120 | ||||
University of California Rev., 4.00%, 5/15/33 | 4,005,000 | 4,569,785 | ||||
University of California Rev., 5.00%, 5/15/40 | 490,000 | 530,998 | ||||
University of California Rev., 5.00%, 5/15/42 | 1,640,000 | 1,941,301 | ||||
University of California Rev., VRDN, 1.40%, 5/15/21 | 1,650,000 | 1,677,803 | ||||
University of California Rev., VRDN, 5.00%, 5/15/23 | 7,935,000 | 9,915,655 | ||||
Upper Santa Clara Valley Joint Powers Authority Rev., 4.00%, 8/1/18 | 600,000 | 638,400 | ||||
Upper Santa Clara Valley Joint Powers Authority Rev., 4.00%, 8/1/19 | 600,000 | 657,150 | ||||
West Contra Costa Unified School District GO, 5.00%, 8/1/30 | 2,000,000 | 2,468,560 | ||||
West Contra Costa Unified School District GO, 5.00%, 8/1/33 | 3,000,000 | 3,665,700 | ||||
West Contra Costa Unified School District GO, 5.00%, 8/1/34 | 1,200,000 | 1,461,372 | ||||
West Contra Costa Unified School District GO, 5.00%, 8/1/35 | 1,500,000 | 1,818,165 | ||||
West Sacramento Financing Authority Special Tax, 5.00%, 9/1/18 (XLCA) | 1,490,000 | 1,606,891 | ||||
West Sacramento Financing Authority Special Tax, 5.00%, 9/1/19 (XLCA) | 995,000 | 1,106,599 | ||||
West Sacramento Financing Authority Special Tax, 5.00%, 9/1/20 (XLCA) | 1,195,000 | 1,364,774 | ||||
Yosemite Community College District GO, Capital Appreciation, 0.00%, 8/1/38(1) | 6,000,000 | 3,154,620 | ||||
1,679,589,843 | ||||||
Guam — 0.1% | ||||||
Guam Government GO, 6.00%, 11/15/19 | 825,000 | 912,442 | ||||
Guam Government Power Authority Rev., 5.00%, 10/1/19 (AGM) | 1,000,000 | 1,110,010 | ||||
2,022,452 | ||||||
TOTAL INVESTMENT SECURITIES — 100.8% (Cost $1,563,535,145) | 1,681,612,295 | |||||
OTHER ASSETS AND LIABILITIES — (0.8)% | (13,667,786) | |||||
TOTAL NET ASSETS — 100.0% | $ | 1,667,944,509 |
29
NOTES TO SCHEDULE OF INVESTMENTS | ||
AGC | - | Assured Guaranty Corporation |
AGM | - | Assured Guaranty Municipal Corporation |
BAM | - | Build America Mutual Assurance Company |
COP | - | Certificates of Participation |
FNMA | - | Federal National Mortgage Association |
GA | - | Guaranty Agreement |
GO | - | General Obligation |
LIQ FAC | - | Liquidity Facilities |
LOC | - | Letter of Credit |
NATL | - | National Public Finance Guarantee Corporation |
SBBPA | - | Standby Bond Purchase Agreement |
VRDN | - | Variable Rate Demand Note. Interest reset date is indicated. Rate shown is effective at the period end. |
VRN | - | Variable Rate Note. Interest reset date is indicated. Rate shown is effective at the period end. |
XLCA | - | XL Capital Ltd. |
(1) | Security is a zero-coupon bond. Zero-coupon securities are issued at a substantial discount from their value at maturity. |
(2) | Escrowed to maturity in U.S. government securities or state and local government securities. |
(3) | When-issued security. The issue price and yield are fixed on the date of the commitment, but payment and delivery are scheduled for a future date. |
(4) | Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration, normally to qualified institutional investors. The aggregate value of these securities at the period end was $10,518,092, which represented 0.6% of total net assets. |
(5) | Coupon rate adjusts periodically based upon a predetermined schedule. Interest reset date is indicated. Rate shown is effective at the period end. |
See Notes to Financial Statements.
30
Statement of Assets and Liabilities |
AUGUST 31, 2016 | |||
Assets | |||
Investment securities, at value (cost of $1,563,535,145) | $ | 1,681,612,295 | |
Cash | 604,016 | ||
Receivable for investments sold | 20,600 | ||
Receivable for capital shares sold | 2,928,141 | ||
Interest receivable | 16,741,510 | ||
1,701,906,562 | |||
Liabilities | |||
Payable for investments purchased | 31,172,238 | ||
Payable for capital shares redeemed | 1,569,773 | ||
Accrued management fees | 597,715 | ||
Distribution and service fees payable | 27,280 | ||
Dividends payable | 595,047 | ||
33,962,053 | |||
Net Assets | $ | 1,667,944,509 | |
Net Assets Consist of: | |||
Capital paid in | $ | 1,553,257,613 | |
Distributions in excess of net investment income | (1,918 | ) | |
Accumulated net realized loss | (3,388,336 | ) | |
Net unrealized appreciation | 118,077,150 | ||
$ | 1,667,944,509 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | ||||
Investor Class | $1,301,750,597 | 106,384,558 | $12.24 | |||
Institutional Class | $298,010,096 | 24,351,022 | $12.24 | |||
A Class | $47,125,503 | 3,850,835 | $12.24* | |||
C Class | $21,058,313 | 1,719,882 | $12.24 |
*Maximum offering price $12.82 (net asset value divided by 0.955).
See Notes to Financial Statements.
31
Statement of Operations |
YEAR ENDED AUGUST 31, 2016 | |||
Investment Income (Loss) | |||
Income: | |||
Interest | $ | 44,017,690 | |
Expenses: | |||
Management fees | 6,744,809 | ||
Distribution and service fees: | |||
A Class | 98,614 | ||
C Class | 182,619 | ||
Trustees' fees and expenses | 94,336 | ||
Other expenses | 16,766 | ||
7,137,144 | |||
Net investment income (loss) | 36,880,546 | ||
Realized and Unrealized Gain (Loss) | |||
Net realized gain (loss) on investment transactions | 7,731,735 | ||
Change in net unrealized appreciation (depreciation) on investments | 41,962,598 | ||
Net realized and unrealized gain (loss) | 49,694,333 | ||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 86,574,879 |
See Notes to Financial Statements.
32
Statement of Changes in Net Assets |
YEARS ENDED AUGUST 31, 2016 AND AUGUST 31, 2015 | ||||||
Increase (Decrease) in Net Assets | August 31, 2016 | August 31, 2015 | ||||
Operations | ||||||
Net investment income (loss) | $ | 36,880,546 | $ | 34,665,041 | ||
Net realized gain (loss) | 7,731,735 | (4,011,300 | ) | |||
Change in net unrealized appreciation (depreciation) | 41,962,598 | (6,569,308 | ) | |||
Net increase (decrease) in net assets resulting from operations | 86,574,879 | 24,084,433 | ||||
Distributions to Shareholders | ||||||
From net investment income: | ||||||
Investor Class | (29,161,214 | ) | (27,681,317 | ) | ||
Institutional Class | (6,650,348 | ) | (5,936,358 | ) | ||
A Class | (824,535 | ) | (805,038 | ) | ||
C Class | (244,449 | ) | (242,328 | ) | ||
Decrease in net assets from distributions | (36,880,546 | ) | (34,665,041 | ) | ||
Capital Share Transactions | ||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 112,576,854 | 193,414,589 | ||||
Net increase (decrease) in net assets | 162,271,187 | 182,833,981 | ||||
Net Assets | ||||||
Beginning of period | 1,505,673,322 | 1,322,839,341 | ||||
End of period | $ | 1,667,944,509 | $ | 1,505,673,322 | ||
Distributions in excess of net investment income | $ | (1,918 | ) | $ | (1,918 | ) |
See Notes to Financial Statements.
33
Notes to Financial Statements |
AUGUST 31, 2016
1. Organization
American Century California Tax-Free and Municipal Funds (the trust) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Massachusetts business trust. California Intermediate-Term Tax-Free Bond Fund (the fund) is one fund in a series issued by the trust. The fund’s investment objective is to seek safety of principal and high current income that is exempt from federal and California income taxes.
The fund offers the Investor Class, the Institutional Class, the A Class and the C Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge. The share classes differ principally in their respective sales charges and distribution and shareholder servicing expenses and arrangements. The Institutional Class is made available to institutional shareholders or through financial intermediaries whose clients do not require the same level of shareholder and administrative services as shareholders of other classes. As a result, the Institutional Class is charged a lower unified management fee.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Trustees has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Fixed income securities are valued at the evaluated mean as provided by independent pricing services or at the mean of the most recent bid and asked prices as provided by investment dealers. Municipal securities are valued using market models that consider trade data, quotations from dealers and active market makers, relevant yield curve and spread data, creditworthiness, trade data or market information on comparable securities, and other relevant security specific information.
Open-end management investment companies are valued at the reported net asset value per share.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Trustees or its delegate, in accordance with policies and procedures adopted by the Board of Trustees. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s net asset value per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region.
34
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investments, including, but not limited to, futures contracts and when-issued securities. American Century Investment Management, Inc. (ACIM) (the investment advisor) monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for margin requirements on futures contracts.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income, if any, are declared daily and paid monthly. Distributions from net realized gains, if any, are generally declared and paid annually.
Indemnifications — Under the trust’s organizational documents, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
3. Fees and Transactions with Related Parties
Certain officers and trustees of the trust are also officers and/or directors of American Century Companies, Inc. (ACC). The trust's investment advisor, ACIM, the trust's distributor, American Century Investment Services, Inc. (ACIS), and the trust's transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The trust has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that all expenses of managing and operating the fund, except distribution and service fees, brokerage expenses, taxes, interest, fees and expenses of the independent trustees (including legal counsel fees), and extraordinary expenses, will be paid by ACIM. The fee is computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fee consists of (1) an Investment Category Fee based on the daily net assets of the fund and certain other accounts managed by the investment advisor that are in the same broad investment category as the fund and (2) a Complex Fee based on the assets of all the funds in the American Century Investments family of funds. The rates for the Investment Category Fee range from 0.1625% to 0.2800%. The rates for the Complex Fee range from 0.2500% to 0.3100% for the Investor Class, A Class and C Class. The rates for the Complex Fee range from 0.0500% to 0.1100% for the Institutional Class. The effective annual management fee for each class for the year ended August 31, 2016 was 0.46% for the Investor Class, A Class and C Class and 0.26% for the Institutional Class.
Distribution and Service Fees — The Board of Trustees has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class and C Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and
35
service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the year ended August 31, 2016 are detailed in the Statement of Operations.
Trustees’ Fees and Expenses — The Board of Trustees is responsible for overseeing the investment advisor’s management and operations of the fund. The trustees receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Trustees. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $16,438,818 and $35,090,000, respectively. The interfund transactions had no effect on the Statement of Operations in net realized gain (loss) on investment transactions.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the year ended August 31, 2016 were $522,278,312 and $361,443,855, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows (unlimited number of shares authorized):
Year ended August 31, 2016 | Year ended August 31, 2015 | |||||||||
Shares | Amount | Shares | Amount | |||||||
Investor Class | ||||||||||
Sold | 24,255,956 | $ | 293,137,206 | 26,776,444 | $ | 319,070,899 | ||||
Issued in reinvestment of distributions | 1,835,589 | 22,173,012 | 1,802,765 | 21,478,133 | ||||||
Redeemed | (22,373,483 | ) | (270,019,311 | ) | (15,057,358 | ) | (179,336,810 | ) | ||
3,718,062 | 45,290,907 | 13,521,851 | 161,212,222 | |||||||
Institutional Class | ||||||||||
Sold | 9,385,505 | 113,275,395 | 5,629,481 | 67,112,507 | ||||||
Issued in reinvestment of distributions | 538,956 | 6,515,524 | 488,458 | 5,819,299 | ||||||
Redeemed | (5,218,776 | ) | (63,051,782 | ) | (3,891,831 | ) | (46,318,259 | ) | ||
4,705,685 | 56,739,137 | 2,226,108 | 26,613,547 | |||||||
A Class | ||||||||||
Sold | 1,596,229 | 19,371,459 | 1,248,227 | 14,886,390 | ||||||
Issued in reinvestment of distributions | 61,012 | 737,202 | 60,961 | 726,450 | ||||||
Redeemed | (1,122,193 | ) | (13,523,992 | ) | (748,912 | ) | (8,926,577 | ) | ||
535,048 | 6,584,669 | 560,276 | 6,686,263 | |||||||
C Class | ||||||||||
Sold | 585,746 | 7,095,797 | 312,075 | 3,713,825 | ||||||
Issued in reinvestment of distributions | 16,212 | 195,996 | 16,567 | 197,590 | ||||||
Redeemed | (275,812 | ) | (3,329,652 | ) | (419,832 | ) | (5,008,858 | ) | ||
326,146 | 3,962,141 | (91,190 | ) | (1,097,443 | ) | |||||
Net increase (decrease) | 9,284,941 | $ | 112,576,854 | 16,217,045 | $ | 193,414,589 |
36
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
• | Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments. |
• | Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars. |
• | Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions). |
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments. There were no significant transfers between levels during the period.
As of period end, the fund’s investment securities were classified as Level 2. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
7. Risk Factors
The fund focuses its investments in a single state and therefore may have more exposure to credit risk related to the state of California than a fund with a broader geographical diversification.
8. Federal Tax Information
The tax character of distributions paid during the years ended August 31, 2016 and August 31, 2015 were as follows:
2016 | 2015 | |||||
Distributions Paid From | ||||||
Exempt income | $ | 36,880,546 | $ | 34,662,983 | ||
Taxable ordinary income | — | $ | 2,058 | |||
Long-term capital gains | — | — |
37
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of August 31, 2016, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 1,563,535,145 | |
Gross tax appreciation of investments | $ | 118,392,445 | |
Gross tax depreciation of investments | (315,295 | ) | |
Net tax appreciation (depreciation) of investments | $ | 118,077,150 | |
Other book-to-tax adjustments | $ | (1,918 | ) |
Undistributed exempt income | — | ||
Accumulated short-term capital losses | $ | (3,388,336 | ) |
The cost of investments for federal income tax purposes was the same as the cost for financial reporting purposes.
Accumulated capital losses represent net capital loss carryovers that may be used to offset future realized capital gains for federal income tax purposes. The capital loss carryovers may be carried forward for an unlimited period. Future capital loss carryover utilization in any given year may be subject to Internal Revenue Code limitations.
38
Financial Highlights |
For a Share Outstanding Throughout the Years Ended August 31 (except as noted) | |||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||
Investor Class | |||||||||||||||
2016 | $11.85 | 0.28 | 0.39 | 0.67 | (0.28) | — | (0.28) | $12.24 | 5.74% | 0.47% | 2.34% | 23% | $1,301,751 | ||
2015 | $11.94 | 0.29 | (0.09) | 0.20 | (0.29) | — | (0.29) | $11.85 | 1.68% | 0.47% | 2.42% | 30% | $1,216,943 | ||
2014 | $11.36 | 0.29 | 0.58 | 0.87 | (0.29) | — | (0.29) | $11.94 | 7.68% | 0.47% | 2.52% | 52% | $1,064,224 | ||
2013 | $11.96 | 0.30 | (0.60) | (0.30) | (0.30) | —(3) | (0.30) | $11.36 | (2.51)% | 0.47% | 2.48% | 46% | $1,000,450 | ||
2012 | $11.41 | 0.36 | 0.55 | 0.91 | (0.36) | — | (0.36) | $11.96 | 8.06% | 0.47% | 3.04% | 55% | $1,026,796 | ||
Institutional Class | |||||||||||||||
2016 | $11.85 | 0.31 | 0.39 | 0.70 | (0.31) | — | (0.31) | $12.24 | 5.95% | 0.27% | 2.54% | 23% | $298,010 | ||
2015 | $11.94 | 0.31 | (0.09) | 0.22 | (0.31) | — | (0.31) | $11.85 | 1.88% | 0.27% | 2.62% | 30% | $232,892 | ||
2014 | $11.37 | 0.32 | 0.57 | 0.89 | (0.32) | — | (0.32) | $11.94 | 7.90% | 0.27% | 2.72% | 52% | $207,978 | ||
2013 | $11.96 | 0.32 | (0.59) | (0.27) | (0.32) | —(3) | (0.32) | $11.37 | (2.32)% | 0.27% | 2.68% | 46% | $160,329 | ||
2012 | $11.41 | 0.38 | 0.55 | 0.93 | (0.38) | — | (0.38) | $11.96 | 8.28% | 0.27% | 3.24% | 55% | $87,170 | ||
A Class | |||||||||||||||
2016 | $11.85 | 0.25 | 0.39 | 0.64 | (0.25) | — | (0.25) | $12.24 | 5.47% | 0.72% | 2.09% | 23% | $47,126 | ||
2015 | $11.94 | 0.26 | (0.09) | 0.17 | (0.26) | — | (0.26) | $11.85 | 1.42% | 0.72% | 2.17% | 30% | $39,308 | ||
2014 | $11.37 | 0.27 | 0.57 | 0.84 | (0.27) | — | (0.27) | $11.94 | 7.41% | 0.72% | 2.27% | 52% | $32,899 | ||
2013 | $11.96 | 0.27 | (0.59) | (0.32) | (0.27) | —(3) | (0.27) | $11.37 | (2.76)% | 0.72% | 2.23% | 46% | $36,644 | ||
2012 | $11.41 | 0.32 | 0.56 | 0.88 | (0.33) | — | (0.33) | $11.96 | 7.79% | 0.72% | 2.79% | 55% | $36,341 |
For a Share Outstanding Throughout the Years Ended August 31 (except as noted) | |||||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||||
Income From Investment Operations: | Distributions From: | Ratio to Average Net Assets of: | |||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Net Investment Income | Net Realized Gains | Total Distributions | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||
C Class | |||||||||||||||
2016 | $11.86 | 0.16 | 0.38 | 0.54 | (0.16) | — | (0.16) | $12.24 | 4.60% | 1.47% | 1.34% | 23% | $21,058 | ||
2015 | $11.95 | 0.17 | (0.09) | 0.08 | (0.17) | — | (0.17) | $11.86 | 0.67% | 1.47% | 1.42% | 30% | $16,531 | ||
2014 | $11.37 | 0.18 | 0.58 | 0.76 | (0.18) | — | (0.18) | $11.95 | 6.71% | 1.47% | 1.52% | 52% | $17,738 | ||
2013 | $11.97 | 0.18 | (0.60) | (0.42) | (0.18) | —(3) | (0.18) | $11.37 | (3.56)% | 1.47% | 1.48% | 46% | $19,555 | ||
2012 | $11.42 | 0.23 | 0.56 | 0.79 | (0.24) | — | (0.24) | $11.97 | 6.99% | 1.47% | 2.04% | 55% | $14,361 |
Notes to Financial Highlights |
(1) | Computed using average shares outstanding throughout the period. |
(2) | Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized. |
(3) | Per-share amount was less than $0.005. |
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Board of Trustees of the American Century California Tax-Free and Municipal Funds and Shareholders of the California Intermediate-Term Tax-Free Bond Fund:
In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the California Intermediate-Term Tax-Free Bond Fund (one of the four funds in the American Century California Tax-Free and Municipal Funds, hereafter referred to as the "Fund") at August 31, 2016, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at August 31, 2016 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Kansas City, Missouri
October 18, 2016
41
Management |
Board of Trustees
The individuals listed below serve as trustees of the funds. Each trustee will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for trustees who are not “interested persons,” as that term is defined in the Investment Company Act (independent trustees). Independent trustees shall retire on December 31 of the year in which they reach their 75th birthday; provided, however, that on or after January 1, 2022, independent trustees shall retire on December 31 of the year in which they reach their 76th birthday.
Mr. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other trustees (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The trustees serve in this capacity for eight (in the case of Mr. Thomas, 15) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the trustees. The mailing address for each trustee other than Mr. Thomas is 1665 Charleston Road, Mountain View, California 94043. The mailing address for Mr. Thomas is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Trustee | Other Directorships Held During Past 5 Years |
Independent Trustees | |||||
Tanya S. Beder (1955) | Trustee | Since 2011 | Chairman and CEO, SBCC Group Inc. (independent advisory services) (2006 to present) | 44 | CYS Investments, Inc. (NYSE mortgage arbitrage REIT) |
Jeremy I. Bulow (1954) | Trustee | Since 2011 | Professor of Economics, Stanford University, Graduate School of Business (1979 to present) | 44 | None |
Anne Casscells (1958) | Trustee | Since 2016 | Co-Chief Executive Officer and Chief Investment Officer, Aetos Alternatives Management (investment advisory firm) (2001 to present); Lecturer in Accounting, Stanford University, Graduate School of Business (2009 to present) | 44 | None |
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Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Trustee | Other Directorships Held During Past 5 Years |
Independent Trustees | |||||
Ronald J. Gilson (1946) | Trustee and Chairman of the Board | Since 1995 (Chairman since 2005) | Charles J. Meyers Professor of Law and Business, Emeritus, Stanford Law School (1979 to present); Marc and Eva Stern Professor of Law and Business, Columbia University School of Law (1992 to present) | 44 | None |
Frederick L. A. Grauer (1946) | Trustee | Since 2008 | Senior Advisor, iShares by BlackRock, Inc. (investment management firm) (2010 to 2011, 2013 to present); Senior Advisor, Course Hero (an educational technology company) (2015 to present) | 44 | None |
Jonathan D. Levin (1972) | Trustee | Since 2016 | Philip H. Knight Professor and Dean, Graduate School of Business, Stanford University (2016 to present); Professor, Stanford University, (2000 to present); Chair, Department of Economics, Stanford University (2011 to 2014) | 44 | None |
Peter F. Pervere (1947) | Trustee | Since 2007 | Retired | 44 | None |
John B. Shoven (1947) | Trustee | Since 2002 | Charles R. Schwab Professor of Economics, Stanford University (1973 to present) | 44 | Cadence Design Systems; Exponent; Financial Engines |
Interested Trustee | |||||
Jonathan S. Thomas (1963) | Trustee and President | Since 2007 | President and Chief Executive Officer, ACC (March 2007 to present). Also serves as Chief Executive Officer, ACS; Executive Vice President, ACIM; Director, ACC, ACIM and other ACC subsidiaries | 127 | BioMed Valley Discoveries, Inc. |
The Statement of Additional Information has additional information about the fund's trustees and is available without charge, upon request, by calling 1-800-345-2021.
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Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 15 investment companies in the American Century family of funds, unless otherwise noted. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each of the officers listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years |
Jonathan S. Thomas (1963) | Trustee and President since 2007 | President and Chief Executive Officer, ACC (March 2007 to present). Also serves as Chief Executive Officer, ACS; Executive Vice President, ACIM; Director, ACC, ACIM and other ACC subsidiaries |
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (March 2014 to present); Chief Compliance Officer, ACIM (February 2014 to present); Chief Compliance Officer, ACIS (October 2009 to present); Vice President, Client Interactions and Marketing, ACIS (February 2013 to January 2014); Director, Client Interactions and Marketing, ACIS (June 2007 to January 2013). Also serves as Vice President, ACIS |
Charles A. Etherington (1957) | General Counsel since 2007 and Senior Vice President since 2006 | Attorney, ACC (February 1994 to present); Vice President, ACC (November 2005 to present); General Counsel, ACC (March 2007 to present). Also serves as General Counsel, ACIM, ACS, ACIS and other ACC subsidiaries; and Senior Vice President, ACIM and ACS |
C. Jean Wade (1964) | Vice President, Treasurer and Chief Financial Officer since 2012 | Vice President, ACS (February 2000 to present) |
Robert J. Leach (1966) | Vice President since 2006 and Assistant Treasurer since 2012 | Vice President, ACS (February 2000 to present) |
David H. Reinmiller (1963) | Vice President since 2001 | Attorney, ACC (January 1994 to present); Associate General Counsel, ACC (January 2001 to present). Also serves as Vice President, ACIM and ACS |
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (June 2003 to present) |
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Approval of Management Agreement |
At a meeting held on June 14, 2016, the Fund’s Board of Trustees (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors/trustees, including a majority of the independent Trustees, each year. The Board regards this annual evaluation and renewal as one of its most important responsibilities.
The independent Trustees have memorialized a statement regarding the relationship between their ongoing obligations to oversee and evaluate the performance of the Advisor and their annual consideration of renewal of the management agreement. In that statement, the independent Trustees noted that their assessment of the Advisor’s performance is an ongoing process that takes place over the entire year and is informed by all of the extensive information that the Board and its committees receive and consider over time. This information, together with the additional materials provided specifically in connection with the review, are central to the Board’s assessment of the Advisor’s performance and its determination whether to renew the Fund’s management agreement.
Prior to its consideration of the renewal of the management agreement, the Board requested and reviewed extensive data and analysis relating to the proposed renewal. This information and analysis was compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor included, but was not limited to, the following:
• | the nature, extent, and quality of investment management, shareholder services, and other services provided by the Advisor to the Fund; |
• | the wide range of other programs and services the Advisor provides to the Fund and its shareholders on a routine and non-routine basis; |
• | the investment performance of the Fund, including data comparing the Fund’s performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies; |
• | the cost of owning the Fund compared to the cost of owning similar funds; |
• | the Advisor’s compliance policies, procedures, and regulatory experience; |
• | financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor; |
• | possible economies of scale associated with the Advisor’s management of the Fund and other accounts under its management; |
• | data comparing services provided and charges to other investment management clients of the Advisor; |
• | acquired fund fees and expenses; |
• | payments by the Fund and the Advisor to financial intermediaries whose clients are investors in the Fund; and |
• | any collateral benefits derived by the Advisor from the management of the Fund. |
In keeping with its practice, the Board held two in-person meetings to review and discuss the information provided in response to their request. The independent Trustees also had the benefit of the advice of their independent counsel throughout the process.
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Factors Considered
The Trustees considered all of the information provided by the Advisor, the independent data providers, and the independent Trustees’ independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Trustees did not identify any single factor as being all-important or controlling and each Trustee may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including the following:
Nature, Extent and Quality of Services - Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that under the management agreement, the Advisor provides or arranges at its own expense a wide variety of services including:
• | constructing and designing the Fund |
• | portfolio research and security selection |
• | initial capitalization/funding |
• | securities trading |
• | Fund administration |
• | custody of Fund assets |
• | daily valuation of the Fund’s portfolio |
• | shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications |
• | legal services (except the independent Trustees’ counsel) |
• | regulatory and portfolio compliance |
• | financial reporting |
• | marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans) |
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management, Shareholder, and Other Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Trustees recognize that the Advisor has an obligation to seek the best execution of fund trades. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Portfolio Committee, regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Trustees also review detailed performance information during the management agreement approval process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was above its benchmark for the one-year period and slightly below its benchmark for the three-, five-, and ten-year periods reviewed by the Board. The Board discussed the Fund’s performance with the Advisor and was satisfied with the efforts being undertaken by the Advisor. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
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Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through various committees of the Board, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction (as measured by external as well as internal sources), technology support, new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. Certain aspects of shareholder and transfer agency service level efficiency and the quality of securities trading activities are measured by independent third party providers and are presented in comparison to other fund groups not managed by the Advisor.
The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund, its overall profitability, and its financial condition. The Trustees have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is appropriately sharing economies of scale through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business to provide shareholders enhanced and expanded services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, the fees and expenses of the Fund’s independent Trustees (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing, and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider and comparing the Fund’s unified fee to the total expense ratio of peer funds. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer group. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
47
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Trustees also requested and received a description of payments made to intermediaries by the Fund and the Advisor. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. The Board noted that the Advisor’s primary business is managing mutual funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. The Board noted that the Advisor receives proprietary research from broker-dealers that execute fund portfolio transactions. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded, however, that the assets of those other clients are not material to the analysis and, where applicable, may be included with the assets of the Fund to determine breakpoints in the management fee schedule.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Trustees. As a result of this process, the Board, including all of the independent Trustees and assisted by the advice of independent legal counsel, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, concluded that the management agreement between the Fund and the Advisor is fair and reasonable in light of the services provided and should be renewed.
48
Proxy Voting Results |
A special meeting of shareholders was held on June 13, 2016, to vote on the following proposal. The proposal received the required number of votes and was adopted. A summary of voting results is listed below.
To elect four trustees to the Board of Trustees of American Century California Tax-Free and Municipal Funds:
Affirmative | Withhold | ||||||
Tanya S. Beder | $ | 2,491,173,919 | $ | 48,905,981 | |||
Jeremy I. Bulow | $ | 2,490,850,243 | $ | 49,229,657 | |||
Anne Casscells | $ | 2,491,569,613 | $ | 48,510,287 | |||
Jonathan D. Levin | $ | 2,491,165,182 | $ | 48,914,718 |
The other trustees whose term of office continued after the meeting include Jonathan S. Thomas, Ronald J. Gilson, Frederick L. A. Grauer, Peter F. Pervere and John B. Shoven.
49
Additional Information |
Proxy Voting Policies
Descriptions of the principles and policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund are available without charge, upon request, by calling 1-800-345-2021 or visiting the "About Us" page of American Century Investments’ website at americancentury.com. A description of the policies is also available on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the "About Us" page at americancentury.com. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund 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 Forms N-Q are available on the SEC’s website at sec.gov, and may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The fund also makes its complete schedule of portfolio holdings for the most recent quarter of its fiscal year available on its website at americancentury.com and, upon request, by calling 1-800-345-2021.
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund designates $36,864,105 as exempt interest dividends for the fiscal year ended August 31, 2016.
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Notes |
51
Notes |
52
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Contact Us | americancentury.com | |
Automated Information Line | 1-800-345-8765 | |
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |
Investors Using Advisors | 1-800-378-9878 | |
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |
Telecommunications Relay Service for the Deaf | 711 | |
American Century California Tax-Free and Municipal Funds | ||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||
©2016 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-90327 1610 |
![acihorizblkb99.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/acihorizblkb99.jpg)
Annual Report | |
August 31, 2016 | |
California High-Yield Municipal Fund |
Table of Contents |
President’s Letter | 2 | |
Performance | 3 | |
Portfolio Commentary | ||
Fund Characteristics | ||
Shareholder Fee Example | ||
Schedule of Investments | ||
Statement of Assets and Liabilities | ||
Statement of Operations | ||
Statement of Changes in Net Assets | ||
Notes to Financial Statements | ||
Financial Highlights | ||
Report of Independent Registered Public Accounting Firm | ||
Management | ||
Approval of Management Agreement | ||
Proxy Voting Results | ||
Additional Information |
Any opinions expressed in this report reflect those of the author as of the date of the report, and do not necessarily represent the opinions of American Century Investments® or any other person in the American Century Investments organization. Any such opinions are subject to change at any time based upon market or other conditions and American Century Investments disclaims any responsibility to update such opinions. These opinions may not be relied upon as investment advice and, because investment decisions made by American Century Investments funds are based on numerous factors, may not be relied upon as an indication of trading intent on behalf of any American Century Investments fund. Security examples are used for representational purposes only and are not intended as recommendations to purchase or sell securities. Performance information for comparative indices and securities is provided to American Century Investments by third party vendors. To the best of American Century Investments’ knowledge, such information is accurate at the time of printing.
President’s Letter |
![jthomasrev0514.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/jthomasrev0514.jpg)
Dear Investor:
Thank you for reviewing this annual report for the period ended August 31, 2016. It provides investment performance and portfolio information for the reporting period, plus longer-term historical performance data.
Annual reports remain important vehicles for conveying information about fund returns, including market factors that affected performance during the reporting period. For additional, updated investment and market insights, we encourage you to visit our website, americancentury.com.
Municipal Bonds (Munis) Generally Extended Their Solid Performance
Key conditions described in our semiannual report letter extended for another six months. Widespread concerns about global economic growth sparked financial market volatility, followed by monetary policy reactions from central banks. The primary catalyst in 2015 was China, where slowing economic growth and currency devaluations sent shock waves through the global markets. These factors re-emerged in January and early February 2016, triggering sell-offs in riskier assets such as stocks and high-yield bonds and encouraging central banks in Japan and Europe to cut interest rates and/or extend their bond-buying (quantitative easing, QE) programs. More QE came after Brexit, the U.K.’s vote to exit the European Union. Monetary policy expansion produced negative interest rates in Japan and Europe, and lowered longer-maturity bond yields globally.
In this bond-friendly environment, munis generally continued to perform well. The broad muni market benefited from its comparatively high overall credit quality, despite defaults in Puerto Rico and financial concerns facing Illinois and New Jersey. We continue to view these as isolated incidents running counter to overall muni credit quality trends. Also, as government bond yields fell globally, after-tax muni yields looked attractive, especially for investors in top tax brackets.
After 12 straight months of positive performance for the broad muni market, we’re positioning muni portfolios for increased volatility (and the possibility of lower returns) after heavy demand compressed the yield differences (spreads) between shorter- and longer-maturity bonds, and higher- and lower-quality bonds. Spreads narrowed to an extent in August 2016 that would indicate a greater chance of widening than narrowing, given the uncertainties ahead, including central bank reviews of their QE programs, the Federal Reserve’s desire to raise interest rates, the fallout from Brexit, and the U.S. presidential election. We appreciate your continued trust in us during this challenging period.
Sincerely,
![image48a01.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/image48a01.jpg)
Jonathan Thomas
President and Chief Executive Officer
American Century Investments
2
Performance |
Total Returns as of August 31, 2016 | ||||||
Average Annual Returns | ||||||
Ticker Symbol | 1 year | 5 years | 10 years | Since Inception | Inception Date | |
Investor Class | BCHYX | 10.27% | 7.32% | 5.34% | — | 12/30/86 |
Bloomberg Barclays Municipal Bond Index | — | 6.88% | 4.80% | 4.87% | — | — |
Institutional Class | BCHIX | 10.49% | 7.53% | — | 7.24% | 3/1/10 |
A Class | CAYAX | 1/31/03 | ||||
No sales charge | 10.00% | 7.05% | 5.08% | — | ||
With sales charge | 5.00% | 6.08% | 4.60% | — | ||
C Class | CAYCX | 9.18% | 6.26% | 4.29% | — | 1/31/03 |
Average annual returns since inception are presented when ten years of performance history is not available.
Returns would have been lower if a portion of the fees had not been waived.
Sales charges include initial sales charges and contingent deferred sales charges (CDSCs), as applicable. A Class shares have a 4.50% maximum initial sales charge and may be subject to a maximum CDSC of 1.00%. C Class shares redeemed within 12 months of purchase are subject to a maximum CDSC of 1.00%. The SEC requires that mutual funds provide performance information net of maximum sales charges in all cases where charges could be applied.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please
call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
3
Growth of $10,000 Over 10 Years |
$10,000 investment made August 31, 2006 |
Performance for other share classes will vary due to differences in fee structure. |
![acctfmf831_chart-53417.jpg](https://capedge.com/proxy/N-CSR/0000717316-16-000065/acctfmf831_chart-53417.jpg)
Value on August 31, 2016 | |
Investor Class — $16,828 | |
Bloomberg Barclays Municipal Bond Index — $16,093 | |
Ending value would have been lower if a portion of the fees had not been waived.
Total Annual Fund Operating Expenses | |||
Investor Class | Institutional Class | A Class | C Class |
0.50% | 0.30% | 0.75% | 1.50% |
The total annual fund operating expenses shown is as stated in the fund’s prospectus current as of the date of this report. The prospectus may vary from the expense ratio shown elsewhere in this report because it is based on a different time period, includes acquired fund fees and expenses, and, if applicable, does not include fee waivers or expense reimbursements.
Data presented reflect past performance. Past performance is no guarantee of future results. Current performance may be higher or lower than the performance shown. Total returns for periods less than one year are not annualized. Investment return and principal value will fluctuate, and redemption value may be more or less than original cost. Data assumes reinvestment of dividends and capital gains, and none of the charts reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. To obtain performance data current to the most recent month end, please
call 1-800-345-2021 or visit americancentury.com. For additional information about the fund, please consult the prospectus.
4
Portfolio Commentary |
Portfolio Managers: Alan Kruss, Joseph Gotelli, and Steven Permut
Performance Summary
California High-Yield Municipal returned 10.27%* for the 12 months ended August 31, 2016, outperforming the investment-grade Bloomberg Barclays Municipal Bond Index, which returned 6.88%. Fund returns reflect operating expenses, while index returns do not.
The fund’s absolute return for the reporting period reflected the positive overall performance of municipal bonds (munis) and California and high-yield munis in particular. The muni market generally rallied, posting a positive total return in each of the 12 months and outperforming the U.S. Treasury market and the broad taxable investment-grade U.S. fixed-income market for the entire period. In addition to benefiting from a favorable backdrop for U.S. fixed-income securities—which included declining interest rates and muted inflation—munis advanced on stable credit trends, positive flows, and other supportive supply/demand factors.
Favorable Fixed-Income Backdrop, Muni Market Dynamics Fueled Gains
Investor concerns about global growth, commodity prices, and central bank monetary decisions generated volatility during the 12-month period. The U.S. economy continued to exhibit modest growth, particularly compared with the rest of the developed world, but the U.S. Federal Reserve (the Fed) remained focused on the sluggish global landscape and its potential risks to the U.S. economy. This triggered ongoing investor speculation regarding the timing and magnitude of Fed interest rate “normalization” and contributed to the volatile climate. However, the Fed implemented only one rate hike during the period—a 25 basis point increase (1 basis point equals 0.01%) on December 16, 2015, which pushed the range for the federal funds rate target to 0.25%-0.50%.
Despite expectations for additional rate hikes in 2016, the Fed cited concerns about the health of the global economy, the uncertainty triggered by the U.K. vote in late June to exit the European Union (Brexit), and weaker-than-expected U.S. economic growth as reasons to pursue a “lower for longer” rate strategy. Meanwhile, central banks in Europe, Japan, and China continued to implement aggressive stimulus programs in response to weak growth rates and deflation threats in those regions. This action increased the relative attractiveness of the U.S. bond market, where yields were generally higher.
This environment led to positive performance for U.S. Treasuries and other U.S. bond market sectors. Munis generally tracked the U.S. Treasury market, but factors specific to the municipal market helped munis outperform. In particular, supply and demand dynamics remained favorable and supported gains. Overall supply increased only slightly, while demand for munis remained robust due to the tax advantages and perceived “safe-haven” munis offered investors. As of August 31, 2016, muni funds experienced 48 consecutive weeks of positive flows, according to Lipper Inc.
Overall, all major sectors of the muni bond market posted positive returns for the 12-month period, according to Bloomberg Barclays. Reflecting investor demand for yield, longer-maturity and lower-quality munis generally performed better than shorter-maturity and higher-quality securities. In addition, revenue bonds outperformed general obligation (GO) bonds.
* | All fund returns referenced in this commentary are for Investor Class shares. Performance for other share classes will vary due to differences in fee structures; when Investor Class performance exceeds that of the fund’s benchmark, other share classes may not. See page 3 for returns for all share classes. |
5
State and National Fiscal, Credit Backdrops Were Generally Positive
State and local finances in California and across the U.S. remained relatively healthy, even as tax revenue growth slowed due to stock market volatility. Spending restraint enabled most states, including California, to maintain stable credit profiles. Furthermore, California’s job growth outpaced the national average, and the state’s housing market continued to improve. In addition, state officials reported $7.3 billion in reserves at the end of fiscal year 2016 and projected reserves would climb to $8.5 billion by the end of fiscal year 2017. Also, in August 2016, Fitch Ratings upgraded California’s bond credit rating from “A+” to “AA-.”
From a national credit rating perspective, downgrades outpaced upgrades in the second calendar quarter of 2016, largely due to troubled credits in Illinois and Michigan. Overall, the national muni default rate remained low. We continue to believe it is unlikely any states will default, but special circumstances may continue to pressure isolated state, local, and commonwealth credit ratings, such as those in Puerto Rico, Illinois, New Jersey, and Michigan.
California and Lower-Quality Biases, Maturity Strategy Drove Outperformance
Our bias toward California munis and lower-quality securities compared with the national investment-grade index primarily contributed to the portfolio’s outperformance. We continued to increase the portfolio’s allocation to below-investment-grade and non-rated securities, particularly within the tobacco, health care, and land-secured sectors. These and other California high-yield munis generally benefited from a stable credit environment, which led to spread tightening (a decrease in the yield differential between higher-quality and lower-quality munis of similar maturity) and robust returns during the reporting period.
In addition, we maintained a flattening bias with respect to the portfolio’s yield-curve positioning, holding more exposure to longer-maturity munis than the index. This strategy aided relative performance as yields on longer-maturity securities declined more than yields on shorter-maturity munis, causing the muni yield curve to flatten. The portfolio’s duration (price sensitivity to interest rate changes), which was slightly longer than the index’s, also lifted performance in this yield environment.
Elsewhere, we continued to favor revenue bonds over GO bonds, which lifted performance. Within the revenue sector, security selection among tobacco, hospital, and special tax bonds aided results. Conversely, security selection among toll roads detracted from relative performance.
Focus on Yield in Range-Bound Market
We believe U.S. economic fundamentals support slightly higher interest rates. But low inflation, weaker global economic fundamentals, low interest rates in Europe and Japan, weak commodity prices, a strong U.S. dollar, and geopolitical uncertainty (particularly in the wake of the Brexit vote) will, in our view, likely keep Fed action slow and data dependent, and keep rates range-bound in the near term. For this reason, we are comfortable maintaining a slightly longer-than-average duration—a strategy that has helped enhance the portfolio’s yield. We also believe volatility may escalate ahead of the November U.S. presidential election, and such volatility may cause credit spreads to widen. This potential backdrop may present compelling buying opportunities among lower-quality credits. In this environment, we believe fundamental credit research, active management, and security selection will become increasingly important.
6
Fund Characteristics |
AUGUST 31, 2016 | |
Portfolio at a Glance | |
Weighted Average Maturity | 19.2 years |
Average Duration (Modified) | 5.8 years |
Top Five Sectors | % of fund investments |
Special Tax | 26% |
Hospital | 14% |
General Obligation (GO) - Local | 7% |
Tollroads | 7% |
Lease Revenue | 6% |
Types of Investments in Portfolio | % of net assets |
Municipal Securities | 100.8% |
Other Assets and Liabilities | (0.8)% |
7
Shareholder Fee Example |
Fund shareholders may incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and redemption/exchange fees; and (2) ongoing costs, including management fees; distribution and service (12b-1) fees; and other fund expenses. This example is intended to help you understand your ongoing costs (in dollars) of investing in your fund and to compare these costs with the ongoing cost of investing in other mutual funds.
The example is based on an investment of $1,000 made at the beginning of the period and held for the entire period from March 1, 2016 to August 31, 2016.
Actual Expenses
The table provides information about actual account values and actual expenses for each class. You may use the information, together with the amount you invested, to estimate the expenses that you paid over the period. First, identify the share class you own. Then simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
If you hold Investor Class shares of any American Century Investments fund, or Institutional Class shares of the American Century Diversified Bond Fund, in an American Century Investments account (i.e., not a financial intermediary or retirement plan account), American Century Investments may charge you a $12.50 semiannual account maintenance fee if the value of those shares is less than $10,000. We will redeem shares automatically in one of your accounts to pay the $12.50 fee. In determining your total eligible investment amount, we will include your investments in all personal accounts (including American Century Investments Brokerage accounts) registered under your Social Security number. Personal accounts include individual accounts, joint accounts, UGMA/UTMA accounts, personal trusts, Coverdell Education Savings Accounts and IRAs (including traditional, Roth, Rollover, SEP-, SARSEP- and SIMPLE-IRAs), and certain other retirement accounts. If you have only business, business retirement, employer-sponsored or American Century Investments Brokerage accounts, you are currently not subject to this fee. If you are subject to the Account Maintenance Fee, your account value could be reduced by the fee amount.
Hypothetical Example for Comparison Purposes
The table also provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio of each class of your fund and an assumed rate of return of 5% per year before expenses, which is not the actual return of a fund’s share class. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in your fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) or redemption/exchange fees. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
8
Beginning Account Value 3/1/16 | Ending Account Value 8/31/16 | Expenses Paid During Period(1) 3/1/16 - 8/31/16 | Annualized Expense Ratio(1) | |
Actual | ||||
Investor Class | $1,000 | $1,051.40 | $2.58 | 0.50% |
Institutional Class | $1,000 | $1,052.40 | $1.55 | 0.30% |
A Class | $1,000 | $1,050.10 | $3.86 | 0.75% |
C Class | $1,000 | $1,046.10 | $7.71 | 1.50% |
Hypothetical | ||||
Investor Class | $1,000 | $1,022.62 | $2.54 | 0.50% |
Institutional Class | $1,000 | $1,023.63 | $1.53 | 0.30% |
A Class | $1,000 | $1,021.37 | $3.81 | 0.75% |
C Class | $1,000 | $1,017.60 | $7.61 | 1.50% |
(1) | Expenses are equal to the class's annualized expense ratio listed in the table above, multiplied by the average account value over the period, multiplied by 184, the number of days in the most recent fiscal half-year, divided by 366, to reflect the one-half year period. |
9
Schedule of Investments |
AUGUST 31, 2016
Principal Amount | Value | |||||
MUNICIPAL SECURITIES — 100.8% | ||||||
California — 99.2% | ||||||
ABAG Finance Authority for Nonprofit Corps. Rev., (Jackson Laboratory), 5.00%, 7/1/37 | $ | 2,000,000 | $ | 2,301,400 | ||
ABAG Finance Authority for Nonprofit Corps. Rev., (Sharp Healthcare Obligated Group), 5.00%, 8/1/43 | 3,500,000 | 4,165,105 | ||||
ABC Unified School District GO, Capital Appreciation, 0.00%, 8/1/21 (NATL)(1) | 1,000,000 | 938,880 | ||||
Alameda Community Facilities District Special Tax, 5.00%, 9/1/42 | 1,250,000 | 1,446,663 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/26 | 2,000,000 | 2,472,880 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/27 (AGM) | 2,000,000 | 2,477,420 | ||||
Alameda Corridor Transportation Authority Rev., 5.00%, 10/1/37 | 1,500,000 | 1,826,400 | ||||
Alhambra Rev., (Atherton Baptist Homes), 7.50%, 1/1/30 | 1,480,000 | 1,683,722 | ||||
Anaheim Public Financing Authority Rev., 5.00%, 5/1/46 | 4,400,000 | 5,292,188 | ||||
Antelope Valley Healthcare District Rev., 5.00%, 3/1/26 | 5,000,000 | 5,948,750 | ||||
Antelope Valley Healthcare District Rev., 5.00%, 3/1/46 | 5,000,000 | 5,462,200 | ||||
Antelope Valley-East Kern Water Agency Rev., 5.00%, 6/1/35 | 2,320,000 | 2,894,084 | ||||
Bay Area Toll Authority Rev., 5.00%, 4/1/43 | 1,000,000 | 1,208,160 | ||||
Bay Area Toll Authority Rev., 5.00%, 10/1/54 | 2,000,000 | 2,400,700 | ||||
Bay Area Toll Authority Rev., VRDN, 1.26%, 9/1/16 | 1,450,000 | 1,450,450 | ||||
Bay Area Toll Authority Rev., VRDN, 1.66%, 9/1/16 | 2,500,000 | 2,526,150 | ||||
Bay Area Toll Authority Rev., VRDN, 1.81%, 9/1/16 | 1,000,000 | 1,018,350 | ||||
Beaumont Financing Authority Special Tax, 6.875%, 9/1/36 | 1,050,000 | 1,053,854 | ||||
Beaumont Unified School District GO, Capital Appreciation, 0.00%, 8/1/40 (AGM)(1) | 2,000,000 | 891,460 | ||||
Berryessa Union School District GO, Capital Appreciation, 0.00%, 8/1/21 (AGM)(1) | 1,190,000 | 1,104,118 | ||||
Berryessa Union School District GO, Capital Appreciation, 0.00%, 8/1/22 (AGM)(1) | 1,220,000 | 1,098,085 | ||||
Berryessa Union School District GO, Capital Appreciation, 0.00%, 8/1/23 (AGM)(1) | 1,000,000 | 866,750 | ||||
California County Tobacco Securitization Agency Rev., (Alameda County Tobacco Securitization Corp.), 0.00%, 6/1/50(1) | 22,520,000 | 2,380,589 | ||||
California County Tobacco Securitization Agency Rev., (Los Angeles County Securitization Corp.), 5.65%, 6/1/41 | 1,500,000 | 1,525,005 | ||||
California Educational Facilities Authority Rev., (Chapman University), 5.00%, 4/1/25 | 715,000 | 904,825 | ||||
California Educational Facilities Authority Rev., (Chapman University), 5.00%, 4/1/31 (GA: Brandman University) | 1,820,000 | 2,102,864 | ||||
California Educational Facilities Authority Rev., (Pepperdine University), 5.00%, 9/1/33 | 2,000,000 | 2,405,320 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 5.00%, 10/1/34 | 1,000,000 | 1,222,350 | ||||
California Educational Facilities Authority Rev., (University of Redlands), 3.50%, 10/1/35 | 800,000 | 853,296 | ||||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/24(2) | 2,250,000 | 2,653,920 |
10
Principal Amount | Value | |||||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/25(2) | $ | 250,000 | $ | 298,323 | ||
California Health Facilities Financing Authority Rev., (Adventist Health System/West Obligated Group), 4.00%, 3/1/39(2) | 4,615,000 | 5,091,499 | ||||
California Health Facilities Financing Authority Rev., (Cedars-Sinai Medical Center), 5.00%, 8/15/39 | 2,000,000 | 2,227,440 | ||||
California Health Facilities Financing Authority Rev., (Children's Hospital of Orange County), 6.50%, 11/1/38 (GA: Children's Healthcare of California) | 3,000,000 | 3,533,100 | ||||
California Health Facilities Financing Authority Rev., (Dignity Health Obligated Group), 6.00%, 7/1/39 | 4,300,000 | 4,908,149 | ||||
California Health Facilities Financing Authority Rev., (Hope Obligated Group), 5.00%, 11/15/39 | 1,910,000 | 2,282,775 | ||||
California Health Facilities Financing Authority Rev., (Lucile Salter Packard Children's Hospital at Stanford Obligated Group), 5.00%, 8/15/26 | 1,020,000 | 1,229,783 | ||||
California Health Facilities Financing Authority Rev., (Lucile Salter Packard Children's Hospital at Stanford Obligated Group), VRDN, 1.45%, 3/15/17, Prerefunded at 100% of Par(3) | 1,910,000 | 1,919,474 | ||||
California Health Facilities Financing Authority Rev., (Providence Health & Services Obligated Group), 6.50%, 10/1/18, Prerefunded at 100% of Par(3) | 1,000,000 | 1,123,080 | ||||
California Health Facilities Financing Authority Rev., (Providence Health & Services Obligated Group), 5.00%, 10/1/38 | 2,000,000 | 2,449,080 | ||||
California Health Facilities Financing Authority Rev., (Scripps Health Obligated Group), 5.50%, 10/1/20 | 1,500,000 | 1,653,180 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System Obligated Group), 5.00%, 7/1/37 | 445,000 | 529,234 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System Obligated Group), VRDN, 5.00%, 10/18/22 | 2,200,000 | 2,681,668 | ||||
California Health Facilities Financing Authority Rev., (St. Joseph Health System), VRDN, 0.62%, 9/1/16 (LOC: U.S. Bank N.A.) | 6,100,000 | 6,100,000 | ||||
California Health Facilities Financing Authority Rev., (Stanford Health Care Obligated Group), 5.00%, 8/15/51 | 2,500,000 | 2,940,575 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.25%, 8/15/31 | 2,030,000 | 2,439,552 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 4.00%, 11/15/41 | 5,000,000 | 5,590,500 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 8/15/43 | 2,880,000 | 3,480,163 | ||||
California Health Facilities Financing Authority Rev., (Sutter Health Obligated Group), 5.00%, 8/15/52 | 5,000,000 | 5,915,850 | ||||
California Infrastructure & Economic Development Bank Rev., (All Sato Kreis Holding LLC), VRDN, 0.60%, 9/1/16 (LOC: Bank of the West) | 1,000,000 | 1,000,000 | ||||
California Infrastructure & Economic Development Bank Rev., (Colburn School), VRDN, 1.56%, 9/1/16 | 2,190,000 | 2,205,133 | ||||
California Infrastructure & Economic Development Bank Rev., (Museum Associates), VRDN, 2.11%, 9/1/16 | 1,000,000 | 1,020,460 | ||||
California Infrastructure & Economic Development Bank Rev., (Pacific Gas & Electric Co.), VRDN, 0.63%, 9/1/16 (LOC: Union Bank N.A.) | 1,200,000 | 1,200,000 | ||||
California Infrastructure & Economic Development Bank Rev., (Pacific Gas & Electric Co.), VRDN, 0.63%, 9/1/16 (LOC: Union Bank N.A.) | 4,995,000 | 4,995,000 | ||||
California Mobilehome Park Financing Authority Rev., (Millennium Housing of California), 5.50%, 12/15/41 | 2,000,000 | 2,010,760 | ||||
California Municipal Finance Authority COP, (Community Hospitals of Central California Obligated Group), 5.50%, 2/1/39 | 1,450,000 | 1,602,453 |
11
Principal Amount | Value | |||||
California Municipal Finance Authority Rev., (Azusa Pacific University), 8.00%, 4/1/21, Prerefunded at 100% of Par(3) | $ | 3,335,000 | $ | 4,380,022 | ||
California Municipal Finance Authority Rev., (Azusa Pacific University), 5.00%, 4/1/41 | 1,860,000 | 2,160,130 | ||||
California Municipal Finance Authority Rev., (Biola University, Inc.), 5.875%, 10/1/34 | 1,000,000 | 1,072,400 | ||||
California Municipal Finance Authority Rev., (Bowles Hall Foundation), 5.00%, 6/1/50 | 1,750,000 | 2,002,122 | ||||
California Municipal Finance Authority Rev., (Caritas Affordable Housing, Inc.), 5.00%, 8/15/20 | 600,000 | 680,724 | ||||
California Municipal Finance Authority Rev., (Caritas Affordable Housing, Inc.), 5.00%, 8/15/22 | 360,000 | 422,359 | ||||
California Municipal Finance Authority Rev., (Community Hospitals of Central California Obligated Group), 5.00%, 2/1/46 | 3,615,000 | 4,209,053 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 5.00%, 11/1/24 | 1,000,000 | 1,218,090 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 5.00%, 11/1/25 | 1,000,000 | 1,231,100 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 5.00%, 11/1/26 | 500,000 | 619,015 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 5.00%, 11/1/35 | 350,000 | 405,160 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 5.00%, 11/1/40 | 500,000 | 578,010 | ||||
California Municipal Finance Authority Rev., (Northbay Healthcare Group Obligated Group), 5.00%, 11/1/44 | 300,000 | 345,624 | ||||
California Municipal Finance Authority Rev., (Santa Rosa Academy LLC), 5.125%, 7/1/35(4) | 905,000 | 1,005,337 | ||||
California Municipal Finance Authority Rev., (Santa Rosa Academy LLC), 5.375%, 7/1/45(4) | 1,400,000 | 1,570,212 | ||||
California Municipal Finance Authority Rev., (Terwilliger Plaza, Inc.), 5.00%, 6/1/36 | 1,000,000 | 1,157,930 | ||||
California Municipal Finance Authority Rev., (Terwilliger Plaza, Inc.), 5.00%, 6/1/46 | 1,000,000 | 1,149,760 | ||||
California Municipal Finance Authority Rev., (Touro College and University System Obligated Group), 5.25%, 1/1/34 | 950,000 | 1,082,297 | ||||
California Municipal Finance Authority Rev., (Touro College and University System Obligated Group), 5.25%, 1/1/40 | 1,750,000 | 1,980,755 | ||||
California Pollution Control Financing Authority Rev., 5.00%, 11/21/45(4) | 3,165,000 | 3,255,487 | ||||
California Pollution Control Financing Authority Rev., (Pacific Gas & Electric Co.), VRDN, 0.62%, 9/1/16 (LOC: TD Bank N.A.) | 2,600,000 | 2,600,000 | ||||
California School Finance Authority Rev., (52nd & Crenshaw LLC), 6.00%, 10/1/49 | 700,000 | 784,700 | ||||
California School Finance Authority Rev., (Alliance for College-Ready Public Schools Obligated Group), 5.00%, 7/1/45(4) | 5,000,000 | 5,772,200 | ||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/27(4) | 500,000 | 595,965 | ||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/28(4) | 685,000 | 811,081 | ||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/29(4) | 795,000 | 937,178 | ||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/30(4) | 400,000 | 469,808 | ||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/31(4) | 500,000 | 584,245 | ||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/40(4) | 1,000,000 | 1,154,860 |
12
Principal Amount | Value | |||||
California School Finance Authority Rev., (Aspire Public Schools Obligated Group), 5.00%, 8/1/46(4) | $ | 1,000,000 | $ | 1,148,120 | ||
California School Finance Authority Rev., (Downtown College Prep Obligated Group), 4.00%, 6/1/26(4) | 1,265,000 | 1,315,752 | ||||
California School Finance Authority Rev., (Downtown College Prep Obligated Group), 4.50%, 6/1/31(4) | 1,000,000 | 1,042,450 | ||||
California School Finance Authority Rev., (Downtown College Prep Obligated Group), 5.00%, 6/1/46(4) | 2,325,000 | 2,449,969 | ||||
California School Finance Authority Rev., (Downtown College Prep Obligated Group), 5.00%, 6/1/51(4) | 2,000,000 | 2,103,900 | ||||
California School Finance Authority Rev., (Green Dot Public Schools Obligated Group), 5.00%, 8/1/45(4) | 3,500,000 | 3,957,205 | ||||
California School Finance Authority Rev., (Klare Holdings), 4.125%, 7/1/24 | 475,000 | 520,961 | ||||
California School Finance Authority Rev., (Klare Holdings), 5.00%, 7/1/34 | 500,000 | 568,450 | ||||
California School Finance Authority Rev., (Klare Holdings), 5.125%, 7/1/44 | 700,000 | 796,138 | ||||
California School Finance Authority Rev., (Klare Holdings), 5.00%, 7/1/45(4) | 1,650,000 | 1,884,184 | ||||
California School Finance Authority Rev., (Launchpad Development Obligated Group), 5.00%, 6/1/21(4) | 400,000 | 439,700 | ||||
California School Finance Authority Rev., (Launchpad Development Obligated Group), 5.00%, 6/1/26(4) | 500,000 | 564,270 | ||||
California School Finance Authority Rev., (Launchpad Development Obligated Group), 5.00%, 6/1/31(4) | 870,000 | 950,693 | ||||
California School Finance Authority Rev., (Launchpad Development Obligated Group), 5.00%, 6/1/36(4) | 1,000,000 | 1,073,440 | ||||
California School Finance Authority Rev., (Launchpad Development Obligated Group), 5.00%, 6/1/46(4) | 2,100,000 | 2,225,580 | ||||
California State Public Works Board Rev., 5.00%, 3/1/17 | 1,000,000 | 1,022,630 | ||||
California State Public Works Board Rev., 4.00%, 11/1/17 | 1,235,000 | 1,285,116 | ||||
California State Public Works Board Rev., 5.00%, 9/1/22, Prerefunded at 100% of Par(3) | 500,000 | 615,260 | ||||
California State Public Works Board Rev., 5.00%, 9/1/23, Prerefunded at 100% of Par(3) | 1,500,000 | 1,895,580 | ||||
California State Public Works Board Rev., 5.00%, 4/1/25 | 1,500,000 | 1,809,180 | ||||
California State Public Works Board Rev., 5.75%, 10/1/30 | 2,000,000 | 2,289,860 | ||||
California State Public Works Board Rev., 5.75%, 10/1/31 | 1,000,000 | 1,227,600 | ||||
California State Public Works Board Rev., 5.00%, 12/1/31 | 975,000 | 1,158,573 | ||||
California State Public Works Board Rev., 6.00%, 3/1/35 | 1,250,000 | 1,468,313 | ||||
California State Public Works Board Rev., 5.00%, 4/1/37 | 5,465,000 | 6,431,212 | ||||
California State Public Works Board Rev., 5.00%, 11/1/38 | 2,350,000 | 2,856,965 | ||||
California State Public Works Board Rev., 5.00%, 9/1/39 | 7,000,000 | 8,493,520 | ||||
California Statewide Communities Development Authority Rev., (899 Charleston LLC), 5.25%, 11/1/44 | 1,500,000 | 1,694,085 | ||||
California Statewide Communities Development Authority Rev., (Adventist Health System/West Obligated Group), 5.00%, 3/1/35 | 1,785,000 | 2,195,032 | ||||
California Statewide Communities Development Authority Rev., (American Baptist Homes of the West Obligated Group), 5.00%, 10/1/43 (GA: American Baptist Homes Foundation) | 1,200,000 | 1,361,412 | ||||
California Statewide Communities Development Authority Rev., (American Baptist Homes of the West Obligated Group), 5.00%, 10/1/45 | 2,400,000 | 2,815,584 | ||||
California Statewide Communities Development Authority Rev., (be.group), 7.25%, 11/15/41(4) | 2,500,000 | 2,911,825 |
13
Principal Amount | Value | |||||
California Statewide Communities Development Authority Rev., (California Baptist University), 5.50%, 11/1/38 | $ | 7,000,000 | $ | 7,254,240 | ||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 3.50%, 5/15/36 | 5,735,000 | 5,987,512 | ||||
California Statewide Communities Development Authority Rev., (CHF-Irvine LLC), 5.00%, 5/15/40 | 1,000,000 | 1,214,230 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/34 | 1,500,000 | 1,783,425 | ||||
California Statewide Communities Development Authority Rev., (Collis P and Howard Huntington Memorial Hospital Obligated Group), 5.00%, 7/1/44 | 2,760,000 | 3,257,711 | ||||
California Statewide Communities Development Authority Rev., (Cottage Health System Obligated Group), 5.25%, 11/1/30 | 1,250,000 | 1,438,900 | ||||
California Statewide Communities Development Authority Rev., (Episcopal Communities & Services for Seniors), 5.00%, 5/15/42 | 1,500,000 | 1,695,210 | ||||
California Statewide Communities Development Authority Rev., (Henry Mayo Newhall Memorial Hospital), 5.25%, 10/1/43 (AGM) | 1,000,000 | 1,202,150 | ||||
California Statewide Communities Development Authority Rev., (Independence Support LLC), 7.00%, 6/1/45 | 7,000,000 | 6,526,310 | ||||
California Statewide Communities Development Authority Rev., (John Muir Health), 4.00%, 8/15/46 | 4,000,000 | 4,427,320 | ||||
California Statewide Communities Development Authority Rev., (John Muir Health), 5.00%, 8/15/46 | 1,125,000 | 1,378,733 | ||||
California Statewide Communities Development Authority Rev., (Kaiser Credit Group), 5.00%, 4/1/42 | 6,000,000 | 6,998,100 | ||||
California Statewide Communities Development Authority Rev., (Lancer Educational Housing LLC), 5.625%, 6/1/33 | 2,500,000 | 2,572,800 | ||||
California Statewide Communities Development Authority Rev., (Loma Linda University Medical Center Obligated Group), 5.00%, 12/1/26(4) | 1,000,000 | 1,223,820 | ||||
California Statewide Communities Development Authority Rev., (Loma Linda University Medical Center Obligated Group), 5.00%, 12/1/36(4) | 1,000,000 | 1,162,430 | ||||
California Statewide Communities Development Authority Rev., (Loma Linda University Medical Center Obligated Group), 5.00%, 12/1/41(4) | 1,000,000 | 1,150,600 | ||||
California Statewide Communities Development Authority Rev., (Loma Linda University Medical Center Obligated Group), 5.25%, 12/1/44 | 5,000,000 | 5,773,100 | ||||
California Statewide Communities Development Authority Rev., (Loma Linda University Medical Center Obligated Group), 5.00%, 12/1/46(4) | 3,000,000 | 3,438,240 | ||||
California Statewide Communities Development Authority Rev., (Loma Linda University Medical Center Obligated Group), 5.25%, 12/1/56(4) | 8,250,000 | 9,588,975 | ||||
California Statewide Communities Development Authority Rev., (Los Angeles Jewish Home for the Aging Obligated Group), 3.00%, 8/1/21 (GA: Jewish Home Foundation/California Mortgage Insurance) | 1,300,000 | 1,304,459 | ||||
California Statewide Communities Development Authority Rev., (Southern California Edison Co.), VRDN, 1.375%, 4/2/18 | 4,350,000 | 4,390,020 | ||||
California Statewide Communities Development Authority Rev., (Sutter Health Obligated Group), 5.05%, 8/15/38 (AGM) | 1,650,000 | 1,772,067 | ||||
California Statewide Communities Development Authority Rev., (Trinity Health Corp. Obligated Group), 5.00%, 12/1/41 | 1,100,000 | 1,296,691 | ||||
California Statewide Communities Development Authority Special Assessment, 2.70%, 9/2/22 | 345,000 | 356,088 | ||||
California Statewide Communities Development Authority Special Assessment, 3.00%, 9/2/23 | 355,000 | 370,322 |
14
Principal Amount | Value | |||||
California Statewide Communities Development Authority Special Assessment, 3.00%, 9/2/24 | $ | 365,000 | $ | 381,524 | ||
California Statewide Communities Development Authority Special Assessment, 5.00%, 9/2/35 | 1,920,000 | 2,212,243 | ||||
California Statewide Communities Development Authority Special Assessment, 5.00%, 9/2/45 | 3,810,000 | 4,336,390 | ||||
California Statewide Communities Development Authority Special Tax, 5.00%, 9/1/36 | 1,000,000 | 1,158,150 | ||||
California Statewide Communities Development Authority Special Tax, 5.00%, 9/1/37 | 4,515,000 | 5,211,032 | ||||
California Statewide Communities Development Authority Special Tax, 5.00%, 9/1/45 | 1,500,000 | 1,719,795 | ||||
Capistrano Unified School District Special Tax, 3.20%, 9/1/44 | 1,630,000 | 1,608,745 | ||||
Capistrano Unified School District Special Tax, 4.00%, 9/1/46(2) | 3,000,000 | 3,262,290 | ||||
Carson Redevelopment Agency Successor Agency Tax Allocation, 7.00%, 10/1/36 | 2,000,000 | 2,354,900 | ||||
Cathedral City Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 8/1/29 (AGM) | 1,250,000 | 1,515,225 | ||||
Cathedral City Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 8/1/30 (AGM) | 1,315,000 | 1,584,338 | ||||
Cathedral City Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 8/1/31 (AGM) | 1,380,000 | 1,654,882 | ||||
Chaffey Joint Union High School District GO, 5.00%, 8/1/32 | 2,000,000 | 2,455,300 | ||||
Chula Vista Rev., (San Diego Gas & Electric Co.), 5.875%, 1/1/34 | 1,000,000 | 1,129,350 | ||||
Clovis Unified School District GO, 5.00%, 8/1/38 | 3,000,000 | 3,641,220 | ||||
Corona-Norca Unified School District Special Tax, 4.00%, 9/1/45 | 2,000,000 | 2,123,680 | ||||
Del Mar Race Track Authority Rev., 5.00%, 10/1/29 | 1,010,000 | 1,151,986 | ||||
Del Mar Race Track Authority Rev., 5.00%, 10/1/35 | 2,000,000 | 2,271,500 | ||||
Dixon Special Tax, 5.00%, 9/1/45 | 4,780,000 | 5,440,214 | ||||
Duarte Unified School District GO, Capital Appreciation, 0.00%, 11/1/23 (AGM)(1) | 1,150,000 | 995,843 | ||||
Eastern Municipal Water District COP, 5.00%, 7/1/33 | 4,000,000 | 4,318,480 | ||||
Eastern Municipal Water District Special Tax, 5.00%, 9/1/36 | 3,575,000 | 4,163,802 | ||||
El County Dorado Special Tax, 5.00%, 9/1/27 | 1,055,000 | 1,315,996 | ||||
El County Dorado Special Tax, 5.00%, 9/1/29 | 1,225,000 | 1,513,622 | ||||
El County Dorado Special Tax, 5.00%, 9/1/30 | 1,325,000 | 1,628,346 | ||||
El County Dorado Special Tax, 5.00%, 9/1/31 | 1,280,000 | 1,565,389 | ||||
El County Dorado Special Tax, 5.00%, 9/1/32 | 1,355,000 | 1,653,086 | ||||
Elk Grove Finance Authority Special Tax, 4.00%, 9/1/22 | 1,310,000 | 1,467,135 | ||||
Elk Grove Finance Authority Special Tax, 4.00%, 9/1/24 | 1,705,000 | 1,936,130 | ||||
Elk Grove Finance Authority Special Tax, 4.00%, 9/1/26 | 2,140,000 | 2,453,724 | ||||
Elk Grove Finance Authority Special Tax, 5.00%, 9/1/46 | 3,500,000 | 4,114,145 | ||||
Elsinore Valley Municipal Water District COP, VRDN, 0.62%, 9/7/16 (LOC: Bank of America N.A.) | 1,200,000 | 1,200,000 | ||||
Emeryville Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/31 (AGM) | 590,000 | 718,307 | ||||
Emeryville Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/34 (AGM) | 1,000,000 | 1,206,000 | ||||
Escondido Joint Powers Financing Authority Rev., 5.00%, 9/1/31 | 1,355,000 | 1,615,417 | ||||
Foothill-De Anza Community College District GO, Capital Appreciation, 0.00%, 8/1/21 (NATL)(1) | 3,000,000 | 2,815,260 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/24(5) | 2,200,000 | 1,969,880 |
15
Principal Amount | Value | |||||
Foothill-Eastern Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/42(1) | $ | 6,000,000 | $ | 2,295,060 | ||
Foothill-Eastern Transportation Corridor Agency Rev., 6.50%, 1/15/43 | 4,000,000 | 4,892,960 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., 6.00%, 1/15/49 | 27,500,000 | 33,344,575 | ||||
Foothill-Eastern Transportation Corridor Agency Rev., VRDN, 5.50%, 1/15/23 | 3,750,000 | 4,481,287 | ||||
Fremont Community Facilities District No. 1 Special Tax, 5.00%, 9/1/40 | 3,000,000 | 3,450,600 | ||||
Fremont Community Facilities District No. 1 Special Tax, 5.00%, 9/1/45 | 2,000,000 | 2,293,060 | ||||
Golden State Tobacco Securitization Corp. Rev., 4.50%, 6/1/27 | 4,650,000 | 4,724,353 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/29 | 1,500,000 | 1,821,750 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.00%, 6/1/33 | 3,000,000 | 3,029,550 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.30%, 6/1/37 | 7,000,000 | 7,190,120 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.125%, 6/1/47 | 15,400,000 | 15,462,216 | ||||
Golden State Tobacco Securitization Corp. Rev., 5.75%, 6/1/47 | 14,805,000 | 15,135,448 | ||||
Hayward Area Recreation and Park District COP, 5.125%, 1/1/39 | 1,500,000 | 1,776,075 | ||||
Hayward Unified School District GO, 4.00%, 8/1/17 (AGM) | 1,650,000 | 1,701,893 | ||||
Hemet Unified School District Financing Authority Special Tax, 5.00%, 9/1/34 | 350,000 | 407,694 | ||||
Hemet Unified School District Financing Authority Special Tax, 5.00%, 9/1/39 | 2,100,000 | 2,418,738 | ||||
Hesperia Special Tax, 5.00%, 9/1/29 | 1,060,000 | 1,232,706 | ||||
Hesperia Special Tax, 5.00%, 9/1/35 | 2,690,000 | 3,059,202 | ||||
Hesperia Public Financing Authority Tax Allocation, 5.50%, 9/1/32 (XLCA) | 3,000,000 | 3,071,550 | ||||
Hesperia Public Financing Authority Tax Allocation, 5.50%, 9/1/37 (XLCA) | 2,025,000 | 2,068,679 | ||||
Huntington Beach Community Facilities District Special Tax, 5.375%, 9/1/33 | 1,700,000 | 1,993,012 | ||||
Imperial Irrigation District Electric System Rev., 5.00%, 11/1/36 | 4,000,000 | 4,974,320 | ||||
Independent Cities Finance Authority Rev., (Augusta Communities LLC), 5.00%, 5/15/39 | 2,500,000 | 2,772,750 | ||||
Independent Cities Finance Authority Rev., (Millennium Housing Corp.), 5.00%, 9/15/36 | 1,000,000 | 1,094,260 | ||||
Independent Cities Finance Authority Rev., (Millennium Housing Corp.), 5.00%, 9/15/36 | 1,500,000 | 1,647,420 | ||||
Independent Cities Finance Authority Rev., (Millennium Housing LLC), 6.75%, 8/15/46 | 2,500,000 | 2,932,450 | ||||
Independent Cities Finance Authority Rev., (Millennium Housing LLC), 5.00%, 10/15/47 | 5,000,000 | 5,457,200 | ||||
Independent Cities Lease Finance Authority Rev., (Millennium Housing of California), 5.70%, 11/15/17, Prerefunded at 100% of Par(3) | 3,430,000 | 3,642,145 | ||||
Inland Valley Development Agency Tax Allocation, 5.25%, 9/1/37 | 1,110,000 | 1,328,481 | ||||
Inland Valley Development Agency Tax Allocation, 5.00%, 9/1/44 | 2,680,000 | 3,123,674 | ||||
Irvine Rev., VRDN, 0.58%, 9/1/16 (LOC: State Street Bank & Trust Co.) | 1,100,000 | 1,100,000 | ||||
Irvine Special Assessment, 5.00%, 9/2/24 | 700,000 | 833,035 | ||||
Irvine Special Assessment, 5.00%, 9/2/26 | 600,000 | 707,280 | ||||
Irvine Special Assessment, 5.00%, 9/2/29 | 700,000 | 825,566 | ||||
Irvine Special Assessment, 5.00%, 9/2/30 | 350,000 | 411,779 |
16
Principal Amount | Value | |||||
Irvine Special Assessment, 5.00%, 9/2/42 | $ | 1,500,000 | $ | 1,722,810 | ||
Irvine Special Assessment, VRDN, 0.58%, 9/1/16 (LOC: U.S. Bank N.A.) | 5,923,000 | 5,923,000 | ||||
Irvine Special Tax, 5.00%, 9/1/49 | 4,500,000 | 5,160,420 | ||||
Irvine Unified School District Special Tax, 6.70%, 9/1/35 | 515,000 | 599,980 | ||||
Jurupa Community Services District Special Tax, 8.875%, 9/1/18, Prerefunded at 100% of Par(3) | 2,000,000 | 2,330,220 | ||||
Jurupa Community Services District Special Tax, 5.00%, 9/1/37 | 250,000 | 281,210 | ||||
Jurupa Community Services District Special Tax, 5.00%, 9/1/40 | 1,605,000 | 1,899,325 | ||||
Jurupa Community Services District Special Tax, 5.00%, 9/1/42 | 1,000,000 | 1,120,930 | ||||
Jurupa Public Financing Authority Special Tax, 5.00%, 9/1/31 | 1,100,000 | 1,330,186 | ||||
Jurupa Public Financing Authority Special Tax, 5.00%, 9/1/42 | 1,000,000 | 1,166,840 | ||||
Kaweah Delta Health Care District Rev., 4.00%, 6/1/45 | 5,010,000 | 5,366,962 | ||||
La Verne COP, (Brethren Hillcrest Homes), 5.00%, 5/15/36 | 1,100,000 | 1,219,229 | ||||
Lake Elsinore Special Tax, 4.00%, 9/1/46 | 4,480,000 | 4,909,094 | ||||
Lake Elsinore Public Financing Authority Special Tax, 5.00%, 9/1/40 | 2,380,000 | 2,737,476 | ||||
Lammersville Joint Unified School District Special Tax, 6.00%, 9/1/43 | 1,250,000 | 1,528,363 | ||||
Long Beach Bond Finance Authority Rev., 5.50%, 11/15/37 (GA: Merrill Lynch & Co.) | 1,150,000 | 1,578,743 | ||||
Long Beach Marina System Rev., 5.00%, 5/15/45 | 5,245,000 | 6,065,003 | ||||
Los Alamitos Unified School District COP, Capital Appreciation, 0.00%, 8/1/24(5) | 1,300,000 | 1,184,833 | ||||
Los Angeles Community College District GO, 5.00%, 8/1/18, Prerefunded at 100% of Par(3) | 2,000,000 | 2,168,920 | ||||
Los Angeles Community Facilities District Special Tax, 6.40%, 9/1/22 | 880,000 | 900,222 | ||||
Los Angeles County COP, 5.00%, 3/1/23 | 1,000,000 | 1,231,570 | ||||
Los Angeles County Regional Financing Authority Rev., (MonteCedro, Inc.), 3.00%, 11/15/21 (California Mortgage Insurance) | 330,000 | 330,647 | ||||
Los Angeles County Schools COP, 4.00%, 6/1/18 (AGM) | 1,650,000 | 1,736,724 | ||||
Los Angeles County Schools COP, 5.00%, 6/1/19 (AGM) | 1,200,000 | 1,334,832 | ||||
Los Angeles County Schools COP, 5.00%, 6/1/20 (AGM) | 1,305,000 | 1,496,718 | ||||
Los Angeles County Schools COP, 5.00%, 6/1/21 (AGM) | 1,895,000 | 2,234,963 | ||||
Los Angeles Department of Airports Rev., 5.00%, 5/15/40 | 2,000,000 | 2,273,780 | ||||
Los Angeles Department of Water & Power Rev., 5.00%, 7/1/30 | 3,500,000 | 4,323,445 | ||||
Los Angeles Department of Water & Power Rev., VRDN, 0.54%, 9/1/16 (SBBPA: Citibank N.A.) | 900,000 | 900,000 | ||||
Los Angeles Department of Water & Power Rev., VRDN, 0.54%, 9/1/16 (SBBPA: Citibank N.A.) | 19,845,000 | 19,845,000 | ||||
Los Angeles Unified School District COP, 5.00%, 10/1/29 | 350,000 | 418,100 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/18 | 3,335,000 | 3,606,602 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/24 | 3,430,000 | 4,091,887 | ||||
Los Angeles Unified School District GO, 5.00%, 7/1/30 | 1,155,000 | 1,442,052 | ||||
Los Angeles Wastewater System Rev., 5.00%, 6/1/32 | 3,000,000 | 3,626,130 | ||||
M-S-R Energy Authority Rev., 7.00%, 11/1/34 (GA: Citigroup, Inc.) | 1,700,000 | 2,606,236 | ||||
M-S-R Energy Authority Rev., 6.50%, 11/1/39 (GA: Citigroup, Inc.) | 4,000,000 | 5,968,360 | ||||
Manteca Redevelopment Agency Tax Allocation, VRDN, 0.56%, 9/1/16 (LOC: State Street Bank & Trust Co.) | 585,000 | 585,000 | ||||
Menifee Union School District Public Financing Authority Special Tax, 5.00%, 9/1/26 | 755,000 | 930,447 |
17
Principal Amount | Value | |||||
Menifee Union School District Public Financing Authority Special Tax, 4.00%, 9/1/27 | $ | 420,000 | $ | 470,009 | ||
Menifee Union School District Public Financing Authority Special Tax, 5.00%, 9/1/28 | 325,000 | 392,152 | ||||
Modesto Irrigation District COP, 6.00%, 10/1/39 | 3,000,000 | 3,385,500 | ||||
Montebello Community Redevelopment Agency Successor Agency Tax Allocation, 8.10%, 3/1/18, Prerefunded at 100% of Par(3) | 2,000,000 | 2,223,400 | ||||
Moorpark Rev., (Villa del Arroyo Moorpark LLC), 6.50%, 5/15/41 | 4,000,000 | 4,642,280 | ||||
Municipal Improvement Corp. of Los Angeles Rev., 4.00%, 11/1/34 | 1,600,000 | 1,806,576 | ||||
Municipal Improvement Corp. of Los Angeles Rev., 4.00%, 11/1/35 | 2,000,000 | 2,242,980 | ||||
Murrieta Financing Authority Special Tax, 5.00%, 9/1/31 | 1,735,000 | 2,013,016 | ||||
Murrieta Valley Unified School District Public Financing Authority Special Tax, 5.00%, 9/1/23 | 2,530,000 | 3,076,910 | ||||
Murrieta Valley Unified School District Public Financing Authority Special Tax, 5.00%, 9/1/30 | 1,735,000 | 2,140,869 | ||||
Murrieta Valley Unified School District Public Financing Authority Special Tax, 5.00%, 9/1/31 | 1,915,000 | 2,349,590 | ||||
Murrieta Valley Unified School District Public Financing Authority Special Tax, 5.00%, 9/1/32 | 1,155,000 | 1,413,674 | ||||
Northern California Power Agency Rev., 5.00%, 7/1/31 | 1,090,000 | 1,299,956 | ||||
Norwalk-La Mirada Unified School District GO, Capital Appreciation, 0.00%, 8/1/38 (AGC)(1) | 10,000,000 | 4,750,700 | ||||
Oakland Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 9/1/16, Prerefunded at 100% of Par (Ambac)(3) | 5,000,000 | 5,000,000 | ||||
Oakland Unified School District/Alameda County GO, 6.125%, 8/1/19, Prerefunded at 100% of Par(3) | 2,500,000 | 2,898,075 | ||||
Oakland Unified School District/Alameda County GO, 5.50%, 8/1/32 | 2,150,000 | 2,621,430 | ||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/35 | 1,200,000 | 1,472,856 | ||||
Oakland Unified School District/Alameda County GO, 6.625%, 8/1/38 | 770,000 | 970,816 | ||||
Oakland Unified School District/Alameda County GO, 5.00%, 8/1/40 | 3,750,000 | 4,568,737 | ||||
Ohlone Community College District GO, 5.00%, 8/1/21, Prerefunded at 100% of Par(3) | 3,000,000 | 3,601,170 | ||||
Ontario Community Facilities District No. 24 Special Tax, 5.00%, 9/1/41(2) | 1,000,000 | 1,172,650 | ||||
Ontario Community Facilities District No. 24 Special Tax, 5.00%, 9/1/46(2) | 1,000,000 | 1,169,510 | ||||
Orange Community Facilities District Special Tax, 5.00%, 10/1/40 (AGM) | 2,000,000 | 2,386,080 | ||||
Orange County Community Facilities District Special Tax, 5.25%, 8/15/45 | 4,000,000 | 4,767,960 | ||||
Orange County Transportation Authority Rev., 5.00%, 8/15/30 | 2,400,000 | 2,933,328 | ||||
Orange County Water District Rev., 5.00%, 8/15/33 | 1,900,000 | 2,340,477 | ||||
Oxnard Financing Authority Rev., 5.00%, 6/1/33 (AGM) | 2,095,000 | 2,520,725 | ||||
Oxnard Financing Authority Rev., 5.00%, 6/1/34 (AGM) | 2,750,000 | 3,300,137 | ||||
Palm Springs Financing Authority Rev., 5.00%, 6/1/35 | 4,000,000 | 4,681,800 | ||||
Palomar Health COP, 5.50%, 11/1/19 | 5,000,000 | 5,449,000 | ||||
Palomar Health COP, 6.75%, 11/1/39 | 2,750,000 | 3,073,290 | ||||
Paramount Unified School District GO, Capital Appreciation, 0.00%, 8/1/51 (BAM)(1) | 12,500,000 | 1,450,375 | ||||
Patterson Joint Unified School District GO, Capital Appreciation, 0.00%, 3/1/49 (AGM)(1) | 8,160,000 | 2,702,837 | ||||
Perris Union High School District Special Tax, 5.00%, 9/1/41 | 2,000,000 | 2,316,580 |
18
Principal Amount | Value | |||||
Pleasant Valley School District/Ventura County GO, 5.85%, 8/1/31 (NATL) | $ | 4,835,000 | $ | 6,383,312 | ||
Poway Unified School District Rev., 7.875%, 9/15/39 | 3,760,000 | 4,386,491 | ||||
Poway Unified School District Special Tax, 5.00%, 9/1/36 | 585,000 | 668,117 | ||||
Poway Unified School District Special Tax, 3.375%, 9/1/42 | 2,500,000 | 2,548,225 | ||||
Poway Unified School District Public Financing Authority Special Tax, 5.00%, 9/1/34 | 1,000,000 | 1,182,090 | ||||
Poway Unified School District Public Financing Authority Special Tax, 5.00%, 9/1/35 | 1,000,000 | 1,178,010 | ||||
Poway Unified School District Public Financing Authority Special Tax, 5.00%, 9/1/36 | 1,250,000 | 1,469,250 | ||||
Rancho Cordova Community Facilities District Special Tax, 4.00%, 9/1/22 | 400,000 | 454,384 | ||||
Rancho Cordova Community Facilities District Special Tax, 4.00%, 9/1/23 | 650,000 | 740,896 | ||||
Rancho Cordova Community Facilities District Special Tax, 4.00%, 9/1/24 | 500,000 | 576,905 | ||||
Rancho Cordova Community Facilities District Special Tax, 4.00%, 9/1/26 | 1,000,000 | 1,161,100 | ||||
Rancho Cordova Community Facilities District Special Tax, 4.00%, 9/1/27 | 425,000 | 488,665 | ||||
Rancho Cordova Community Facilities District Special Tax, 4.00%, 9/1/29 | 1,280,000 | 1,440,512 | ||||
Rancho Cordova Community Facilities District Special Tax, 4.00%, 9/1/31 | 1,350,000 | 1,505,412 | ||||
Rancho Cordova Community Facilities District Special Tax, 4.00%, 9/1/37 | 1,000,000 | 1,105,870 | ||||
Rancho Cordova Community Facilities District Special Tax, 5.00%, 9/1/40 | 1,195,000 | 1,359,384 | ||||
Rancho Cordova Community Facilities District Special Tax, 5.00%, 9/1/45 | 1,250,000 | 1,417,425 | ||||
Redwood City Redevelopment Agency Successor Agency Tax Allocation, Capital Appreciation, 0.00%, 7/15/28 (Ambac)(1) | 3,405,000 | 2,399,129 | ||||
Rio Elementary School District Community Facilities District Special Tax, 5.00%, 9/1/35 | 2,550,000 | 2,939,053 | ||||
Rio Elementary School District Community Facilities District Special Tax, 5.50%, 9/1/39 | 1,785,000 | 2,057,980 | ||||
River Islands Public Financing Authority Special Tax, 5.50%, 9/1/45 | 1,500,000 | 1,670,235 | ||||
River Islands Public Financing Authority Special Tax, 5.50%, 9/1/45 | 5,000,000 | 5,567,450 | ||||
Riverside County Community Facilities Districts Special Tax, 5.00%, 9/1/30 | 1,035,000 | 1,174,632 | ||||
Riverside County Community Facilities Districts Special Tax, 5.00%, 9/1/35 | 2,520,000 | 2,816,377 | ||||
Riverside County Community Facilities Districts Special Tax, 5.00%, 9/1/40 | 2,250,000 | 2,632,230 | ||||
Riverside County Community Facilities Districts Special Tax, 5.00%, 9/1/42 | 3,000,000 | 3,327,810 | ||||
Riverside County Community Facilities Districts Special Tax, 5.00%, 9/1/44 | 2,735,000 | 3,183,102 | ||||
Riverside County Public Financing Authority Tax Allocation, 4.00%, 10/1/36 (BAM) | 2,500,000 | 2,775,100 | ||||
Riverside County Redevelopment Successor Agency Tax Allocation, 6.25%, 10/1/30 | 2,200,000 | 2,597,276 | ||||
Riverside County Transportation Commission Rev., 5.25%, 6/1/39 | 800,000 | 987,832 | ||||
Riverside County Transportation Commission Rev., Capital Appreciation, 0.00%, 6/1/41(1) | 2,000,000 | 775,700 |
19
Principal Amount | Value | |||||
Riverside County Transportation Commission Rev., Capital Appreciation, 0.00%, 6/1/42(1) | $ | 3,320,000 | $ | 1,223,785 | ||
Riverside County Transportation Commission Rev., Capital Appreciation, 0.00%, 6/1/43(1) | 5,000,000 | 1,727,800 | ||||
Riverside County Transportation Commission Rev., 5.75%, 6/1/44 | 500,000 | 596,565 | ||||
Riverside Sewer Rev., 5.00%, 8/1/40 | 2,000,000 | 2,415,140 | ||||
Romoland School District Special Tax, 5.00%, 9/1/35 | 4,685,000 | 5,437,926 | ||||
Romoland School District Special Tax, 5.00%, 9/1/38 | 2,900,000 | 3,339,669 | ||||
Romoland School District Special Tax, 5.00%, 9/1/43 | 2,640,000 | 2,952,286 | ||||
Roseville Special Tax, 6.125%, 9/1/18, Prerefunded at 100% of Par(3) | 2,600,000 | 2,885,064 | ||||
Roseville Special Tax, 5.00%, 9/1/37 | 1,250,000 | 1,453,400 | ||||
Roseville Special Tax, 5.00%, 9/1/38 | 1,650,000 | 1,971,057 | ||||
Roseville Special Tax, 5.00%, 9/1/44 | 1,650,000 | 1,843,760 | ||||
Roseville Electric System Rev., 5.00%, 2/1/37 | 925,000 | 1,035,075 | ||||
Sacramento County Special Tax, 5.00%, 9/1/40 | 1,000,000 | 1,183,380 | ||||
Sacramento County Special Tax, 5.00%, 9/1/45 | 1,500,000 | 1,768,890 | ||||
Sacramento County Special Tax, 5.00%, 9/1/46 | 2,385,000 | 2,723,598 | ||||
Sacramento County Airport System Rev., 6.00%, 7/1/35 | 4,000,000 | 4,374,280 | ||||
Sacramento Municipal Utility District Rev., 5.00%, 8/15/31 | 625,000 | 757,369 | ||||
Sacramento Municipal Utility District Rev., 5.00%, 8/15/33 | 1,000,000 | 1,211,790 | ||||
Sacramento Transportation Authority Rev., 5.00%, 10/1/24 | 1,055,000 | 1,301,691 | ||||
San Bernardino County Rev., (WLP Parkview Place Apartments LLC), VRDN, 0.63%, 9/1/16 (LIQ FAC: FNMA) | 2,300,000 | 2,300,000 | ||||
San Bernardino County Special Tax, 5.00%, 9/1/33 | 3,000,000 | 3,479,430 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 2.00%, 12/1/17 (AGM) | 2,675,000 | 2,716,329 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 12/1/21 (AGM) | 3,900,000 | 4,641,546 | ||||
San Bernardino Redevelopment Agency Successor Agency Tax Allocation, 5.00%, 12/1/23 (AGM) | 2,425,000 | 3,001,859 | ||||
San Buenaventura Rev., (Community Memorial Health System), 7.50%, 12/1/41 | 9,350,000 | 11,638,880 | ||||
San Clemente Special Tax, 5.00%, 9/1/46 | 2,000,000 | 2,310,040 | ||||
San Diego Special Tax, 5.00%, 9/1/37 | 1,000,000 | 1,197,480 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/25 | 835,000 | 1,071,890 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/26 | 525,000 | 669,333 | ||||
San Diego County Rev., (Sanford Burnham Prebys Medical Discovery Institute), 5.00%, 11/1/30 | 725,000 | 903,916 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/24 | 300,000 | 370,143 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/25 | 955,000 | 1,169,226 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/26 | 500,000 | 607,820 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/43 | 2,500,000 | 2,921,050 | ||||
San Diego County Regional Airport Authority Rev., 5.00%, 7/1/44 | 1,500,000 | 1,779,300 | ||||
San Diego County Water Authority Financing Corp. Rev., 5.00%, 5/1/33 | 1,500,000 | 1,823,865 | ||||
San Diego Public Facilities Financing Authority Rev., 5.00%, 4/15/37 | 2,000,000 | 2,291,160 | ||||
San Diego Public Facilities Financing Authority Rev., 5.00%, 10/15/44 | 2,660,000 | 3,260,149 |
20
Principal Amount | Value | |||||
San Diego Public Facilities Financing Authority Water Rev., 5.00%, 8/1/30 | $ | 2,000,000 | $ | 2,427,600 | ||
San Diego Redevelopment Agency Successor Agency Tax Allocation, 7.00%, 11/1/39 | 3,000,000 | 3,557,040 | ||||
San Diego Unified Port District Rev., 5.00%, 9/1/26 | 750,000 | 909,008 | ||||
San Francisco City & County Airport Comm-San Francisco International Airport Rev., 5.25%, 5/1/18, Prerefunded at 100% of Par(3) | 3,000,000 | 3,234,030 | ||||
San Francisco City & County Redevelopment Agency Special Tax, Capital Appreciation, 0.00%, 8/1/43(1) | 5,500,000 | 1,301,080 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 6.625%, 8/1/19, Prerefunded at 100% of Par(3) | 2,000,000 | 2,345,420 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 6.75%, 2/1/21, Prerefunded at 100% of Par(3) | 1,000,000 | 1,257,020 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 7.00%, 2/1/21, Prerefunded at 100% of Par(3) | 1,250,000 | 1,584,800 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/33 | 780,000 | 930,376 | ||||
San Francisco City & County Redevelopment Agency Tax Allocation, 5.00%, 8/1/43 | 1,000,000 | 1,177,750 | ||||
San Gorgonio Memorial Health Care District GO, 4.00%, 8/1/17 | 435,000 | 448,133 | ||||
San Gorgonio Memorial Health Care District GO, 4.00%, 8/1/18 | 515,000 | 546,451 | ||||
San Gorgonio Memorial Health Care District GO, 5.00%, 8/1/20 | 1,000,000 | 1,151,860 | ||||
San Gorgonio Memorial Health Care District GO, 5.00%, 8/1/21 | 275,000 | 324,935 | ||||
San Jacinto Community Facilities District Special Tax, 5.00%, 9/1/32 | 450,000 | 529,380 | ||||
San Jacinto Community Facilities District Special Tax, 5.00%, 9/1/33 | 280,000 | 327,807 | ||||
San Jacinto Community Facilities District Special Tax, 5.00%, 9/1/34 | 335,000 | 390,727 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/25 (NATL)(1) | 3,090,000 | 2,464,491 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/29 (NATL)(1) | 165,000 | 109,522 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/31 (NATL)(1) | 16,000,000 | 9,813,920 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/32 (NATL)(1) | 290,000 | 170,636 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., Capital Appreciation, 0.00%, 1/15/36 (NATL)(1) | 1,335,000 | 664,990 | ||||
San Joaquin Hills Transportation Corridor Agency Rev., 5.25%, 1/15/44 | 6,000,000 | 6,774,660 | ||||
San Jose Airport Rev., 5.25%, 3/1/34 | 2,605,000 | 3,019,143 | ||||
San Mateo Special Tax, 6.00%, 9/1/42 | 500,000 | 580,415 | ||||
San Mateo Special Tax, 5.50%, 9/1/44 | 2,250,000 | 2,569,140 | ||||
Santa Barbara Secondary High School District GO, 0.00%, 8/1/36(1) | 10,000,000 | 5,198,400 | ||||
Santa Barbara Secondary High School District GO, 0.00%, 8/1/40(1) | 3,795,000 | 1,729,344 | ||||
Santa Cruz County Redevelopment Agency Tax Allocation, 7.00%, 9/1/19, Prerefunded at 100% of Par(3) | 3,000,000 | 3,564,840 | ||||
Santa Cruz County Redevelopment Agency Tax Allocation, 4.00%, 9/1/34 (BAM) | 1,000,000 | 1,136,020 | ||||
Santa Cruz County Redevelopment Agency Tax Allocation, 4.00%, 9/1/35 (BAM) | 900,000 | 1,017,729 | ||||
Santa Cruz County Redevelopment Agency Tax Allocation, 4.00%, 9/1/36 (BAM) | 1,350,000 | 1,520,762 |
21
Principal Amount | Value | |||||
Santa Margarita Water District Special Tax, 5.625%, 9/1/43 | $ | 1,250,000 | $ | 1,473,350 | ||
Santaluz Community Facilities District No. 2 Special Tax, 5.10%, 9/1/30 | 465,000 | 531,453 | ||||
Saugus-Castaic School Facilities Financing Authority Special Tax, 6.00%, 9/1/43 | 1,480,000 | 1,742,448 | ||||
Saugus/Hart School Facilities Financing Authority Special Tax, 5.00%, 9/1/41 | 1,235,000 | 1,461,771 | ||||
Saugus/Hart School Facilities Financing Authority Special Tax, 5.00%, 9/1/46 | 1,245,000 | 1,469,810 | ||||
Silicon Valley Tobacco Securitization Authority Rev., Capital Appreciation, 0.00%, 6/1/36(1) | 12,000,000 | 4,013,040 | ||||
Silicon Valley Tobacco Securitization Authority Rev., Capital Appreciation, 0.00%, 6/1/41(1) | 5,000,000 | 1,168,700 | ||||
South Placer Wastewater Authority Rev., VRN, 0.89%, 9/1/16 | 2,985,000 | 2,973,657 | ||||
Southern California Public Power Authority Rev., 5.25%, 11/1/19 (GA: Goldman Sachs & Co.) | 2,445,000 | 2,746,860 | ||||
Southern California Public Power Authority Rev., 5.00%, 11/1/33 (GA: Goldman Sachs & Co.) | 3,755,000 | 4,856,755 | ||||
Southern Mono Health Care District GO, Capital Appreciation, 0.00%, 8/1/26 (NATL)(1) | 1,800,000 | 1,254,402 | ||||
Southwestern Community College District GO, Capital Appreciation, 0.00%, 8/1/46(1) | 12,425,000 | 4,563,827 | ||||
State of California GO, 4.00%, 9/1/17 | 10,000,000 | 10,351,700 | ||||
State of California GO, 5.00%, 11/1/19 | 5,000,000 | 5,672,100 | ||||
State of California GO, 5.00%, 9/1/23(2) | 7,000,000 | 8,747,900 | ||||
State of California GO, 5.25%, 2/1/30 | 5,000,000 | 6,055,950 | ||||
State of California GO, 5.00%, 2/1/38 | 4,635,000 | 5,554,816 | ||||
State of California GO, 6.00%, 4/1/38 | 5,000,000 | 5,667,250 | ||||
State of California GO, 5.00%, 2/1/43 | 5,650,000 | 6,748,473 | ||||
State of California GO, VRDN, 0.55%, 9/1/16 (LOC: Citibank N.A.) | 1,600,000 | 1,600,000 | ||||
State of California GO, VRN, 1.46%, 9/1/16 | 2,000,000 | 2,010,000 | ||||
State of California GO, VRN, 1.56%, 9/1/16 | 800,000 | 806,024 | ||||
State of California GO, VRN, 1.71%, 9/1/16 | 960,000 | 973,651 | ||||
Stockton Public Financing Authority Rev., 5.00%, 9/1/28 (BAM) | 2,215,000 | 2,735,924 | ||||
Stockton Public Financing Authority Rev., 5.00%, 9/1/29 (BAM) | 1,750,000 | 2,147,460 | ||||
Stockton Public Financing Authority Rev., 6.25%, 10/1/40 | 1,750,000 | 2,213,785 | ||||
Stockton Unified School District GO, 5.00%, 8/1/31 | 4,620,000 | 5,705,885 | ||||
Stockton Unified School District GO, 5.00%, 8/1/42 (AGM) | 705,000 | 839,232 | ||||
Sunnyvale Special Tax, 7.75%, 8/1/32 | 6,500,000 | 6,518,135 | ||||
Susanville Public Financing Authority Rev., 6.00%, 6/1/45 | 3,000,000 | 3,322,530 | ||||
Sutter Union High School District GO, Capital Appreciation, 0.00%, 6/1/50 (BAM)(1) | 2,935,000 | 767,884 | ||||
Sweetwater Union High School District GO, 4.00%, 8/1/42 | 5,000,000 | 5,590,100 | ||||
Tahoe-Truckee Unified School District GO, Capital Appreciation, 0.00%, 8/1/22 (NATL)(1) | 2,690,000 | 2,422,829 | ||||
Tahoe-Truckee Unified School District GO, Capital Appreciation, 0.00%, 8/1/23 (NATL)(1) | 2,220,000 | 1,944,054 | ||||
Tejon Ranch Public Facilities Finance Authority Special Tax, 5.00%, 9/1/45 | 4,000,000 | 4,552,480 | ||||
Tobacco Securitization Authority of Northern California Rev., (Sacramento County Tobacco Securitization Corp.), 5.50%, 6/1/45 | 2,000,000 | 2,000,140 | ||||
Tobacco Securitization Authority of Southern California Rev., (San Diego County Tobacco Asset Securitization Corp.), 5.00%, 6/1/37 | 2,250,000 | 2,250,180 | ||||
Tobacco Securitization Authority of Southern California Rev., (San Diego County Tobacco Asset Securitization Corp.), 5.125%, 6/1/46 | 6,750,000 | 6,750,405 |
22
Principal Amount | Value | |||||
Tracy Community Facilities District No. 2006-01 Special Tax, 5.75%, 9/1/36 | $ | 3,105,000 | $ | 3,110,030 | ||
Tracy Public Financing Authority Special Tax, 4.00%, 9/2/18 | 1,900,000 | 2,008,566 | ||||
Tracy Public Financing Authority Special Tax, 5.00%, 9/2/19 | 2,285,000 | 2,541,491 | ||||
Tracy Public Financing Authority Special Tax, 5.00%, 9/2/20 | 2,100,000 | 2,398,515 | ||||
Tri-Dam Power Authority Rev., 4.00%, 11/1/16 | 2,165,000 | 2,173,443 | ||||
Tulare Sewer Rev., 5.00%, 11/15/22 (AGM) | 500,000 | 613,165 | ||||
Tulare Sewer Rev., 5.00%, 11/15/24 (AGM) | 500,000 | 638,620 | ||||
Tulare Sewer Rev., 5.00%, 11/15/25 (AGM) | 400,000 | 518,012 | ||||
Tuolumne Wind Project Authority Rev., 5.875%, 1/1/29 | 2,000,000 | 2,227,720 | ||||
Turlock Public Financing Authority Tax Allocation, 7.50%, 9/1/39 | 2,770,000 | 3,465,021 | ||||
Tustin Community Facilities District Special Tax, 6.00%, 9/1/17, Prerefunded at 100% of Par(3) | 1,300,000 | 1,370,044 | ||||
Tustin Community Facilities District Special Tax, 6.00%, 9/1/17, Prerefunded at 100% of Par(3) | 4,945,000 | 5,211,437 | ||||
Tustin Community Facilities District Special Tax, 5.00%, 9/1/37 | 3,330,000 | 3,929,566 | ||||
Tustin Community Facilities District Special Tax, 5.00%, 9/1/40 | 1,100,000 | 1,293,578 | ||||
Tustin Community Facilities District Special Tax, 5.00%, 9/1/45 | 2,200,000 | 2,578,884 | ||||
Tustin Unified School District Special Tax, 5.75%, 9/1/30 | 1,000,000 | 1,141,400 | ||||
Tustin Unified School District Special Tax, 6.00%, 9/1/40 | 1,500,000 | 1,741,245 | ||||
Twin Rivers Unified School District COP, VRDN, 3.20%, 6/1/20 (AGM) | 1,750,000 | 1,753,185 | ||||
Twin Rivers Unified School District COP, VRDN, 3.20%, 6/1/20 (AGM) | 1,000,000 | 1,001,820 | ||||
University of California Rev., 5.00%, 5/15/37 | 5,000,000 | 5,960,700 | ||||
Val Verde Unified School District Special Tax, 5.00%, 9/1/37 | 1,750,000 | 2,006,637 | ||||
Ventura County Community College District GO, 5.50%, 8/1/18, Prerefunded at 100% of Par(3) | 1,600,000 | 1,751,648 | ||||
Washington Township Health Care District Rev., 5.00%, 7/1/26 | 400,000 | 486,064 | ||||
Washington Township Health Care District Rev., 3.25%, 7/1/27 | 1,000,000 | 1,056,670 | ||||
Washington Township Health Care District Rev., 3.50%, 7/1/28 | 750,000 | 800,813 | ||||
Washington Township Health Care District Rev., 3.75%, 7/1/29 | 1,000,000 | 1,065,000 | ||||
West Hollywood Public Financing Authority Rev., 4.00%, 4/1/46 | 4,000,000 | 4,461,480 | ||||
Whittier Rev., (Presbyterian Intercommunity Hospital Obligated Group), 5.00%, 6/1/44 | 3,500,000 | 4,098,080 | ||||
Yuba City Unified School District GO, Capital Appreciation, 0.00%, 3/1/25 (NATL)(1) | 1,500,000 | 1,230,375 | ||||
1,158,662,216 | ||||||
Guam — 1.2% | ||||||
Guam Government GO, 7.00%, 11/15/19, Prerefunded at 100% of Par(3) | 7,230,000 | 8,650,189 | ||||
Guam Government Rev., 5.125%, 1/1/42 | 1,000,000 | 1,102,680 | ||||
Guam Government Power Authority Rev., 5.00%, 10/1/34 | 850,000 | 946,866 | ||||
Guam Government Waterworks Authority Rev., 5.00%, 1/1/46 | 3,000,000 | 3,518,700 | ||||
14,218,435 | ||||||
U.S. Virgin Islands — 0.4% | ||||||
Virgin Islands Public Finance Authority Rev., 5.00%, 9/1/33(4) | 2,500,000 | 2,864,225 | ||||
Virgin Islands Public Finance Authority Rev., 6.75%, 10/1/37 | 2,000,000 | 2,112,380 | ||||
4,976,605 | ||||||
TOTAL INVESTMENT SECURITIES — 100.8% (Cost $1,065,528,515) | 1,177,857,256 | |||||
OTHER ASSETS AND LIABILITIES — (0.8)% | (9,623,601) | |||||
TOTAL NET ASSETS — 100.0% | $ | 1,168,233,655 |
23
NOTES TO SCHEDULE OF INVESTMENTS | ||
AGC | - | Assured Guaranty Corporation |
AGM | - | Assured Guaranty Municipal Corporation |
BAM | - | Build America Mutual Assurance Company |
COP | - | Certificates of Participation |
FNMA | - | Federal National Mortgage Association |
GA | - | Guaranty Agreement |
GO | - | General Obligation |
LIQ FAC | - | Liquidity Facilities |
LOC | - | Letter of Credit |
NATL | - | National Public Finance Guarantee Corporation |
SBBPA | - | Standby Bond Purchase Agreement |
VRDN | - | Variable Rate Demand Note. Interest reset date is indicated. Rate shown is effective at the period end. |
VRN | - | Variable Rate Note. Interest reset date is indicated. Rate shown is effective at the period end. |
XLCA | - | XL Capital Ltd. |
(1) | Security is a zero-coupon bond. Zero-coupon securities are issued at a substantial discount from their value at maturity. |
(2) | When-issued security. The issue price and yield are fixed on the date of the commitment, but payment and delivery are scheduled for a future date. |
(3) | Escrowed to maturity in U.S. government securities or state and local government securities. |
(4) | Security was purchased pursuant to Rule 144A under the Securities Act of 1933 and may be sold in transactions exempt from registration, normally to qualified institutional investors. The aggregate value of these securities at the period end was $57,651,751, which represented 4.9% of total net assets. |
(5) | Coupon rate adjusts periodically based upon a predetermined schedule. Interest reset date is indicated. Rate shown is effective at the period end. |
See Notes to Financial Statements.
24
Statement of Assets and Liabilities |
AUGUST 31, 2016 | |||
Assets | |||
Investment securities, at value (cost of $1,065,528,515) | $ | 1,177,857,256 | |
Cash | 790,331 | ||
Receivable for investments sold | 120,150 | ||
Receivable for capital shares sold | 1,471,023 | ||
Interest receivable | 13,644,784 | ||
1,193,883,544 | |||
Liabilities | |||
Payable for investments purchased | 22,322,258 | ||
Payable for capital shares redeemed | 2,404,926 | ||
Accrued management fees | 461,778 | ||
Distribution and service fees payable | 57,070 | ||
Dividends payable | 403,857 | ||
25,649,889 | |||
Net Assets | $ | 1,168,233,655 | |
Net Assets Consist of: | |||
Capital paid in | $ | 1,094,685,315 | |
Accumulated net realized loss | (38,780,401 | ) | |
Net unrealized appreciation | 112,328,741 | ||
$ | 1,168,233,655 |
Net Assets | Shares Outstanding | Net Asset Value Per Share | ||||
Investor Class | $860,996,641 | 78,467,550 | $10.97 | |||
Institutional Class | $137,887,978 | 12,570,295 | $10.97 | |||
A Class | $135,279,416 | 12,328,054 | $10.97* | |||
C Class | $34,069,620 | 3,104,420 | $10.97 |
*Maximum offering price $11.49 (net asset value divided by 0.955).
See Notes to Financial Statements.
25
Statement of Operations |
YEAR ENDED AUGUST 31, 2016 | |||
Investment Income (Loss) | |||
Income: | |||
Interest | $ | 39,450,792 | |
Expenses: | |||
Management fees | 4,700,271 | ||
Distribution and service fees: | |||
A Class | 315,033 | ||
C Class | 306,149 | ||
Trustees' fees and expenses | 59,497 | ||
Other expenses | 13,920 | ||
5,394,870 | |||
Net investment income (loss) | 34,055,922 | ||
Realized and Unrealized Gain (Loss) | |||
Net realized gain (loss) on: | |||
Investment transactions | 4,160,621 | ||
Futures contract transactions | 69,766 | ||
4,230,387 | |||
Change in net unrealized appreciation (depreciation) on: | |||
Investments | 57,875,220 | ||
Futures contracts | (78,527 | ) | |
57,796,693 | |||
Net realized and unrealized gain (loss) | 62,027,080 | ||
Net Increase (Decrease) in Net Assets Resulting from Operations | $ | 96,083,002 |
See Notes to Financial Statements.
26
Statement of Changes in Net Assets |
YEARS ENDED AUGUST 31, 2016 AND AUGUST 31, 2015 | ||||||
Increase (Decrease) in Net Assets | August 31, 2016 | August 31, 2015 | ||||
Operations | ||||||
Net investment income (loss) | $ | 34,055,922 | $ | 31,052,252 | ||
Net realized gain (loss) | 4,230,387 | (3,687,147 | ) | |||
Change in net unrealized appreciation (depreciation) | 57,796,693 | 6,737,352 | ||||
Net increase (decrease) in net assets resulting from operations | 96,083,002 | 34,102,457 | ||||
Distributions to Shareholders | ||||||
From net investment income: | ||||||
Investor Class | (25,388,631 | ) | (22,933,451 | ) | ||
Institutional Class | (3,839,737 | ) | (3,213,866 | ) | ||
A Class | (4,068,923 | ) | (4,194,466 | ) | ||
C Class | (758,631 | ) | (710,469 | ) | ||
Decrease in net assets from distributions | (34,055,922 | ) | (31,052,252 | ) | ||
Capital Share Transactions | ||||||
Net increase (decrease) in net assets from capital share transactions (Note 5) | 243,686,421 | 72,245,980 | ||||
Net increase (decrease) in net assets | 305,713,501 | 75,296,185 | ||||
Net Assets | ||||||
Beginning of period | 862,520,154 | 787,223,969 | ||||
End of period | $ | 1,168,233,655 | $ | 862,520,154 |
See Notes to Financial Statements.
27
Notes to Financial Statements |
AUGUST 31, 2016
1. Organization
American Century California Tax-Free and Municipal Funds (the trust) is registered under the Investment Company Act of 1940, as amended (the 1940 Act), as an open-end management investment company and is organized as a Massachusetts business trust. California High-Yield Municipal Fund (the fund) is one fund in a series issued by the trust. The fund’s investment objective is to seek high current income that is exempt from federal and California income taxes.
The fund offers the Investor Class, the Institutional Class, the A Class and the C Class. The A Class may incur an initial sales charge. The A Class and C Class may be subject to a contingent deferred sales charge. The share classes differ principally in their respective sales charges and distribution and shareholder servicing expenses and arrangements. The Institutional Class is made available to institutional shareholders or through financial intermediaries whose clients do not require the same level of shareholder and administrative services as shareholders of other classes. As a result, the Institutional Class is charged a lower unified management fee.
2. Significant Accounting Policies
The following is a summary of significant accounting policies consistently followed by the fund in preparation of its financial statements. The fund is an investment company and follows accounting and reporting guidance in accordance with accounting principles generally accepted in the United States of America. This may require management to make certain estimates and assumptions at the date of the financial statements. Actual results could differ from these estimates. Management evaluated the impact of events or transactions occurring through the date the financial statements were issued that would merit recognition or disclosure.
Investment Valuations — The fund determines the fair value of its investments and computes its net asset value per share at the close of regular trading (usually 4 p.m. Eastern time) on the New York Stock Exchange (NYSE) on each day the NYSE is open. The Board of Trustees has adopted valuation policies and procedures to guide the investment advisor in the fund’s investment valuation process and to provide methodologies for the oversight of the fund’s pricing function.
Fixed income securities are valued at the evaluated mean as provided by independent pricing services or at the mean of the most recent bid and asked prices as provided by investment dealers. Municipal securities are valued using market models that consider trade data, quotations from dealers and active market makers, relevant yield curve and spread data, creditworthiness, trade data or market information on comparable securities, and other relevant security specific information.
Open-end management investment companies are valued at the reported net asset value per share. Exchange-traded futures contracts are valued at the settlement price as provided by the appropriate clearing corporation.
If the fund determines that the market price for an investment is not readily available or the valuation methods mentioned above do not reflect an investment’s fair value, such investment is valued as determined in good faith by the Board of Trustees or its delegate, in accordance with policies and procedures adopted by the Board of Trustees. In its determination of fair value, the fund may review several factors including, but not limited to, market information regarding the specific investment or comparable investments and correlation with other investment types, futures indices or general market indicators. Circumstances that may cause the fund to use these procedures to value an investment include, but are not limited to: an investment has been declared in default or is distressed; trading in a security has been suspended during the trading day or a security is not actively trading on its principal exchange; prices received from a regular pricing source are deemed unreliable; or there is a foreign market holiday and no trading occurred.
The fund monitors for significant events occurring after the close of an investment’s primary exchange but before the fund’s net asset value per share is determined. Significant events may include, but are not limited to: corporate announcements and transactions; governmental action and political unrest that could impact a specific investment or an investment sector; or armed conflicts, natural disasters and similar events that could affect investments in a specific country or region.
28
Security Transactions — Security transactions are accounted for as of the trade date. Net realized gains and losses are determined on the identified cost basis, which is also used for federal income tax purposes.
Investment Income — Interest income is recorded on the accrual basis and includes accretion of discounts and amortization of premiums.
Segregated Assets — In accordance with the 1940 Act, the fund segregates assets on its books and records to cover certain types of investments, including, but not limited to, futures contracts and when-issued securities. American Century Investment Management, Inc. (ACIM) (the investment advisor) monitors, on a daily basis, the securities segregated to ensure the fund designates a sufficient amount of liquid assets, marked-to-market daily. The fund may also receive assets or be required to pledge assets at the custodian bank or with a broker for margin requirements on futures contracts.
Income Tax Status — It is the fund’s policy to distribute substantially all net investment income and net realized gains to shareholders and to otherwise qualify as a regulated investment company under provisions of the Internal Revenue Code. Accordingly, no provision has been made for income taxes. The fund files U.S. federal, state, local and non-U.S. tax returns as applicable. The fund's tax returns are subject to examination by the relevant taxing authority until expiration of the applicable statute of limitations, which is generally three years from the date of filing but can be longer in certain jurisdictions. At this time, management believes there are no uncertain tax positions which, based on their technical merit, would not be sustained upon examination and for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Multiple Class — All shares of the fund represent an equal pro rata interest in the net assets of the class to which such shares belong, and have identical voting, dividend, liquidation and other rights and the same terms and conditions, except for class specific expenses and exclusive rights to vote on matters affecting only individual classes. Income, non-class specific expenses, and realized and unrealized capital gains and losses of the fund are allocated to each class of shares based on their relative net assets.
Distributions to Shareholders — Distributions from net investment income, if any, are declared daily and paid monthly. Distributions from net realized gains, if any, are generally declared and paid annually.
Indemnifications — Under the trust’s organizational documents, its officers and trustees are indemnified against certain liabilities arising out of the performance of their duties to the fund. In addition, in the normal course of business, the fund enters into contracts that provide general indemnifications. The maximum exposure under these arrangements is unknown as this would involve future claims that may be made against a fund. The risk of material loss from such claims is considered by management to be remote.
3. Fees and Transactions with Related Parties
Certain officers and trustees of the trust are also officers and/or directors of American Century Companies, Inc. (ACC). The trust's investment advisor, ACIM, the trust's distributor, American Century Investment Services, Inc. (ACIS), and the trust's transfer agent, American Century Services, LLC, are wholly owned, directly or indirectly, by ACC.
Management Fees — The trust has entered into a management agreement with ACIM, under which ACIM provides the fund with investment advisory and management services in exchange for a single, unified management fee (the fee) per class. The agreement provides that all expenses of managing and operating the fund, except distribution and service fees, brokerage expenses, taxes, interest, fees and expenses of the independent trustees (including legal counsel fees), and extraordinary expenses, will be paid by ACIM. The fee is computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fee consists of (1) an Investment Category Fee based on the daily net assets of the fund and certain other accounts managed by the investment advisor that are in the same broad investment category as the fund and (2) a Complex Fee based on the assets of all the funds in the American Century Investments family of funds. The rates for the Investment Category Fee range from 0.1925% to 0.3100%. The rates for the Complex Fee range from 0.2500% to 0.3100% for the Investor Class, A Class and C Class. The rates for the Complex Fee range from 0.0500% to 0.1100% for the Institutional Class. The effective annual management fee for each class for the year ended August 31, 2016 was 0.49% for the Investor Class, A Class and C Class and 0.29% for the Institutional Class.
Distribution and Service Fees — The Board of Trustees has adopted a separate Master Distribution and Individual Shareholder Services Plan for each of the A Class and C Class (collectively the plans), pursuant to Rule 12b-1 of the 1940 Act. The plans provide that the A Class will pay ACIS an annual distribution and
29
service fee of 0.25%. The plans provide that the C Class will pay ACIS an annual distribution and service fee of 1.00%, of which 0.25% is paid for individual shareholder services and 0.75% is paid for distribution services. The fees are computed and accrued daily based on each class’s daily net assets and paid monthly in arrears. The fees are used to pay financial intermediaries for distribution and individual shareholder services. Fees incurred under the plans during the year ended August 31, 2016 are detailed in the Statement of Operations.
Trustees’ Fees and Expenses — The Board of Trustees is responsible for overseeing the investment advisor’s management and operations of the fund. The trustees receive detailed information about the fund and its investment advisor regularly throughout the year, and meet at least quarterly with management of the investment advisor to review reports about fund operations. The fund’s officers do not receive compensation from the fund.
Interfund Transactions — The fund may enter into security transactions with other American Century Investments funds and other client accounts of the investment advisor, in accordance with the 1940 Act rules and procedures adopted by the Board of Trustees. The rules and procedures require, among other things, that these transactions be effected at the independent current market price of the security. During the period, the interfund purchases and sales were $29,390,000 and $19,100,000, respectively. The interfund transactions had no effect on the Statement of Operations in net realized gain (loss) on investment transactions.
4. Investment Transactions
Purchases and sales of investment securities, excluding short-term investments, for the year ended August 31, 2016 were $455,801,843 and $188,781,606, respectively.
5. Capital Share Transactions
Transactions in shares of the fund were as follows (unlimited number of shares authorized):
Year ended August 31, 2016 | Year ended August 31, 2015 | |||||||||
Shares | Amount | Shares | Amount | |||||||
Investor Class | ||||||||||
Sold | 26,802,333 | $ | 286,994,238 | 16,300,335 | $ | 168,967,153 | ||||
Issued in reinvestment of distributions | 2,007,232 | 21,446,102 | 1,815,379 | 18,804,585 | ||||||
Redeemed | (11,670,371 | ) | (124,790,844 | ) | (12,572,062 | ) | (130,008,836 | ) | ||
17,139,194 | 183,649,496 | 5,543,652 | 57,762,902 | |||||||
Institutional Class | ||||||||||
Sold | 5,076,136 | 54,438,032 | 2,159,763 | 22,373,675 | ||||||
Issued in reinvestment of distributions | 347,604 | 3,713,020 | 303,391 | 3,141,909 | ||||||
Redeemed | (987,026 | ) | (10,524,745 | ) | (1,799,790 | ) | (18,737,563 | ) | ||
4,436,714 | 47,626,307 | 663,364 | 6,778,021 | |||||||
A Class | ||||||||||
Sold | 3,326,804 | 35,497,945 | 2,760,616 | 28,582,741 | ||||||
Issued in reinvestment of distributions | 346,809 | 3,699,115 | 373,436 | 3,869,303 | ||||||
Redeemed | (2,912,232 | ) | (31,016,450 | ) | (2,771,772 | ) | (28,720,194 | ) | ||
761,381 | 8,180,610 | 362,280 | 3,731,850 | |||||||
C Class | ||||||||||
Sold | 913,025 | 9,779,499 | 758,896 | 7,858,572 | ||||||
Issued in reinvestment of distributions | 53,006 | 565,560 | 49,897 | 516,947 | ||||||
Redeemed | (571,494 | ) | (6,115,051 | ) | (425,841 | ) | (4,402,312 | ) | ||
394,537 | 4,230,008 | 382,952 | 3,973,207 | |||||||
Net increase (decrease) | 22,731,826 | $ | 243,686,421 | 6,952,248 | $ | 72,245,980 |
30
6. Fair Value Measurements
The fund’s investments valuation process is based on several considerations and may use multiple inputs to determine the fair value of the investments held by the fund. In conformity with accounting principles generally accepted in the United States of America, the inputs used to determine a valuation are classified into three broad levels.
• | Level 1 valuation inputs consist of unadjusted quoted prices in an active market for identical investments. |
• | Level 2 valuation inputs consist of direct or indirect observable market data (including quoted prices for comparable investments, evaluations of subsequent market events, interest rates, prepayment speeds, credit risk, etc.). These inputs also consist of quoted prices for identical investments initially expressed in local currencies that are adjusted through translation into U.S. dollars. |
• | Level 3 valuation inputs consist of unobservable data (including a fund’s own assumptions). |
The level classification is based on the lowest level input that is significant to the fair valuation measurement. The valuation inputs are not necessarily an indication of the risks associated with investing in these securities or other financial instruments. There were no significant transfers between levels during the period.
As of period end, the fund’s investment securities were classified as Level 2. The Schedule of Investments provides additional information on the fund’s portfolio holdings.
7. Derivative Instruments
Interest Rate Risk — The fund is subject to interest rate risk in the normal course of pursuing its investment objectives. The value of bonds generally declines as interest rates rise. A fund may enter into futures contracts based on a bond index or a specific underlying security. A fund may purchase futures contracts to gain exposure to increases in market value or sell futures contracts to protect against a decline in market value. Upon entering into a futures contract, a fund will segregate cash, cash equivalents or other appropriate liquid securities on its records in amounts sufficient to meet requirements. Subsequent payments (variation margin) are made or received daily, in cash, by a fund. The variation margin is equal to the daily change in the contract value and is recorded as unrealized gains and losses. A fund recognizes a realized gain or loss when the futures contract is closed or expires. Net realized and unrealized gains or losses occurring during the holding period of futures contracts are a component of net realized gain (loss) on futures contract transactions and change in net unrealized appreciation (depreciation) on futures contracts, respectively. One of the risks of entering into futures contracts is the possibility that the change in value of the contract may not correlate with the changes in value of the underlying securities. The fund's average exposure to interest rate risk derivative instruments held during the period was 37 contracts.
At period end, the fund did not have any derivative instruments disclosed on the Statement of Assets and Liabilities. For the year ended August 31, 2016, the effect of interest rate risk derivative instruments on the Statement of Operations was $69,766 in net realized gain (loss) on futures contract transactions and $(78,527) in change in net unrealized appreciation (depreciation) on futures contracts.
8. Risk Factors
The fund focuses its investments in a single state and therefore may have more exposure to credit risk related to the state of California than a fund with a broader geographical diversification. The fund invests in lower-rated debt securities, which are subject to substantial risks including liquidity risk and credit risk.
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9. Federal Tax Information
The tax character of distributions paid during the years ended August 31, 2016 and August 31, 2015 were as follows:
2016 | 2015 | |||||
Distributions Paid From | ||||||
Exempt income | $ | 34,055,922 | $ | 31,004,444 | ||
Taxable ordinary income | — | $ | 47,808 | |||
Long-term capital gains | — | — |
The book-basis character of distributions made during the year from net investment income or net realized gains may differ from their ultimate characterization for federal income tax purposes. These differences reflect the differing character of certain income items and net realized gains and losses for financial statement and tax purposes, and may result in reclassification among certain capital accounts on the financial statements.
As of August 31, 2016, the federal tax cost of investments and the components of distributable earnings on a tax-basis were as follows:
Federal tax cost of investments | $ | 1,065,528,515 | |
Gross tax appreciation of investments | $ | 112,600,380 | |
Gross tax depreciation of investments | (271,639 | ) | |
Net tax appreciation (depreciation) of investments | $ | 112,328,741 | |
Undistributed exempt income | — | ||
Accumulated short-term capital losses | $ | (35,918,944 | ) |
Accumulated long-term capital losses | $ | (2,861,457 | ) |
The cost of investments for federal income tax purposes was the same as the cost for financial reporting purposes.
Accumulated capital losses represent net capital loss carryovers that may be used to offset future realized capital gains for federal income tax purposes. Any unlimited losses will be required to be utilized prior to the losses which carry an expiration date. Future capital loss carryover utilization in any given year may be subject to Internal Revenue Code limitations. Capital loss carryovers expire as follows:
2017 | 2018 | 2019 | Unlimited (Short-Term) | Unlimited (Long-Term) |
$(9,518,848) | $(12,885,340) | $(6,203,529) | $(7,311,227) | $(2,861,457) |
32
Financial Highlights |
For a Share Outstanding Throughout the Years Ended August 31 (except as noted) | |||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Investment Income | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||
Investor Class | |||||||||||||
2016 | $10.30 | 0.37 | 0.67 | 1.04 | (0.37) | $10.97 | 10.27% | 0.50% | 3.47% | 19% | $860,997 | ||
2015 | $10.25 | 0.39 | 0.05 | 0.44 | (0.39) | $10.30 | 4.32% | 0.50% | 3.75% | 41% | $631,702 | ||
2014 | $9.33 | 0.41 | 0.92 | 1.33 | (0.41) | $10.25 | 14.50% | 0.50% | 4.14% | 57% | $571,924 | ||
2013 | $10.13 | 0.40 | (0.80) | (0.40) | (0.40) | $9.33 | (4.14)% | 0.50% | 3.99% | 81% | $472,141 | ||
2012 | $9.40 | 0.45 | 0.73 | 1.18 | (0.45) | $10.13 | 12.79% | 0.50% | 4.55% | 48% | $506,399 | ||
Institutional Class | |||||||||||||
2016 | $10.30 | 0.39 | 0.67 | 1.06 | (0.39) | $10.97 | 10.49% | 0.30% | 3.67% | 19% | $137,888 | ||
2015 | $10.25 | 0.41 | 0.05 | 0.46 | (0.41) | $10.30 | 4.53% | 0.30% | 3.95% | 41% | $83,751 | ||
2014 | $9.33 | 0.43 | 0.92 | 1.35 | (0.43) | $10.25 | 14.73% | 0.30% | 4.34% | 57% | $76,561 | ||
2013 | $10.13 | 0.42 | (0.80) | (0.38) | (0.42) | $9.33 | (3.94)% | 0.30% | 4.19% | 81% | $25,217 | ||
2012 | $9.40 | 0.46 | 0.74 | 1.20 | (0.47) | $10.13 | 13.01% | 0.30% | 4.75% | 48% | $22,287 | ||
A Class | |||||||||||||
2016 | $10.30 | 0.34 | 0.67 | 1.01 | (0.34) | $10.97 | 10.00% | 0.75% | 3.22% | 19% | $135,279 | ||
2015 | $10.25 | 0.36 | 0.05 | 0.41 | (0.36) | $10.30 | 4.06% | 0.75% | 3.50% | 41% | $119,150 | ||
2014 | $9.33 | 0.38 | 0.92 | 1.30 | (0.38) | $10.25 | 14.21% | 0.75% | 3.89% | 57% | $114,878 | ||
2013 | $10.13 | 0.38 | (0.80) | (0.42) | (0.38) | $9.33 | (4.38)% | 0.75% | 3.74% | 81% | $105,296 | ||
2012 | $9.40 | 0.42 | 0.73 | 1.15 | (0.42) | $10.13 | 12.51% | 0.75% | 4.30% | 48% | $117,162 |
For a Share Outstanding Throughout the Years Ended August 31 (except as noted) | |||||||||||||
Per-Share Data | Ratios and Supplemental Data | ||||||||||||
Income From Investment Operations: | Ratio to Average Net Assets of: | ||||||||||||
Net Asset Value, Beginning of Period | Net Investment Income (Loss)(1) | Net Realized and Unrealized Gain (Loss) | Total From Investment Operations | Distributions From Net Investment Income | Net Asset Value, End of Period | Total Return(2) | Operating Expenses | Net Investment Income (Loss) | Portfolio Turnover Rate | Net Assets, End of Period (in thousands) | |||
C Class | |||||||||||||
2016 | $10.30 | 0.26 | 0.67 | 0.93 | (0.26) | $10.97 | 9.18% | 1.50% | 2.47% | 19% | $34,070 | ||
2015 | $10.25 | 0.28 | 0.05 | 0.33 | (0.28) | $10.30 | 3.29% | 1.50% | 2.75% | 41% | $27,917 | ||
2014 | $9.33 | 0.31 | 0.92 | 1.23 | (0.31) | $10.25 | 13.37% | 1.50% | 3.14% | 57% | $23,860 | ||
2013 | $10.13 | 0.30 | (0.80) | (0.50) | (0.30) | $9.33 | (5.09)% | 1.50% | 2.99% | 81% | $25,056 | ||
2012 | $9.40 | 0.35 | 0.73 | 1.08 | (0.35) | $10.13 | 11.67% | 1.50% | 3.55% | 48% | $29,388 |
Notes to Financial Highlights |
(1) | Computed using average shares outstanding throughout the period. |
(2) | Total returns are calculated based on the net asset value of the last business day and do not reflect applicable sales charges, if any. Total returns for periods less than one year are not annualized. |
See Notes to Financial Statements.
Report of Independent Registered Public Accounting Firm |
To the Board of Trustees of the American Century California Tax-Free and Municipal Funds and Shareholders of the California High-Yield Municipal Fund:
In our opinion, the accompanying statement of assets and liabilities, including the schedule of investments, and the related statements of operations and of changes in net assets and the financial highlights present fairly, in all material respects, the financial position of the California High-Yield Municipal Fund (one of the four funds in the American Century California Tax-Free and Municipal Funds, hereafter referred to as the "Fund") at August 31, 2016, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended, in conformity with accounting principles generally accepted in the United States of America. These financial statements and financial highlights (hereafter referred to as "financial statements") are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits, which included confirmation of securities at August 31, 2016 by correspondence with the custodian and brokers, provide a reasonable basis for our opinion.
PricewaterhouseCoopers LLP
Kansas City, Missouri
October 18, 2016
35
Management |
Board of Trustees
The individuals listed below serve as trustees of the funds. Each trustee will continue to serve in this capacity until death, retirement, resignation or removal from office. The board has adopted a mandatory retirement age for trustees who are not “interested persons,” as that term is defined in the Investment Company Act (independent trustees). Independent trustees shall retire on December 31 of the year in which they reach their 75th birthday; provided, however, that on or after January 1, 2022, independent trustees shall retire on December 31 of the year in which they reach their 76th birthday.
Mr. Thomas is an “interested person” because he currently serves as President and Chief Executive Officer of American Century Companies, Inc. (ACC), the parent company of American Century Investment Management, Inc. (ACIM or the advisor). The other trustees (more than three-fourths of the total number) are independent. They are not employees, directors or officers of, and have no financial interest in, ACC or any of its wholly owned, direct or indirect, subsidiaries, including ACIM, American Century Investment Services, Inc. (ACIS) and American Century Services, LLC (ACS), and they do not have any other affiliations, positions or relationships that would cause them to be considered “interested persons” under the Investment Company Act. The trustees serve in this capacity for eight (in the case of Mr. Thomas, 15) registered investment companies in the American Century Investments family of funds.
The following table presents additional information about the trustees. The mailing address for each trustee other than Mr. Thomas is 1665 Charleston Road, Mountain View, California 94043. The mailing address for Mr. Thomas is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Trustee | Other Directorships Held During Past 5 Years |
Independent Trustees | |||||
Tanya S. Beder (1955) | Trustee | Since 2011 | Chairman and CEO, SBCC Group Inc. (independent advisory services) (2006 to present) | 44 | CYS Investments, Inc. (NYSE mortgage arbitrage REIT) |
Jeremy I. Bulow (1954) | Trustee | Since 2011 | Professor of Economics, Stanford University, Graduate School of Business (1979 to present) | 44 | None |
Anne Casscells (1958) | Trustee | Since 2016 | Co-Chief Executive Officer and Chief Investment Officer, Aetos Alternatives Management (investment advisory firm) (2001 to present); Lecturer in Accounting, Stanford University, Graduate School of Business (2009 to present) | 44 | None |
36
Name (Year of Birth) | Position(s) Held with Funds | Length of Time Served | Principal Occupation(s) During Past 5 Years | Number of American Century Portfolios Overseen by Trustee | Other Directorships Held During Past 5 Years |
Independent Trustees | |||||
Ronald J. Gilson (1946) | Trustee and Chairman of the Board | Since 1995 (Chairman since 2005) | Charles J. Meyers Professor of Law and Business, Emeritus, Stanford Law School (1979 to present); Marc and Eva Stern Professor of Law and Business, Columbia University School of Law (1992 to present) | 44 | None |
Frederick L. A. Grauer (1946) | Trustee | Since 2008 | Senior Advisor, iShares by BlackRock, Inc. (investment management firm) (2010 to 2011, 2013 to present); Senior Advisor, Course Hero (an educational technology company) (2015 to present) | 44 | None |
Jonathan D. Levin (1972) | Trustee | Since 2016 | Philip H. Knight Professor and Dean, Graduate School of Business, Stanford University (2016 to present); Professor, Stanford University, (2000 to present); Chair, Department of Economics, Stanford University (2011 to 2014) | 44 | None |
Peter F. Pervere (1947) | Trustee | Since 2007 | Retired | 44 | None |
John B. Shoven (1947) | Trustee | Since 2002 | Charles R. Schwab Professor of Economics, Stanford University (1973 to present) | 44 | Cadence Design Systems; Exponent; Financial Engines |
Interested Trustee | |||||
Jonathan S. Thomas (1963) | Trustee and President | Since 2007 | President and Chief Executive Officer, ACC (March 2007 to present). Also serves as Chief Executive Officer, ACS; Executive Vice President, ACIM; Director, ACC, ACIM and other ACC subsidiaries | 127 | BioMed Valley Discoveries, Inc. |
The Statement of Additional Information has additional information about the fund's trustees and is available without charge, upon request, by calling 1-800-345-2021.
37
Officers
The following table presents certain information about the executive officers of the funds. Each officer serves as an officer for each of the 15 investment companies in the American Century family of funds, unless otherwise noted. No officer is compensated for his or her service as an officer of the funds. The listed officers are interested persons of the funds and are appointed or re-appointed on an annual basis. The mailing address for each of the officers listed below is 4500 Main Street, Kansas City, Missouri 64111.
Name (Year of Birth) | Offices with the Funds | Principal Occupation(s) During the Past Five Years |
Jonathan S. Thomas (1963) | Trustee and President since 2007 | President and Chief Executive Officer, ACC (March 2007 to present). Also serves as Chief Executive Officer, ACS; Executive Vice President, ACIM; Director, ACC, ACIM and other ACC subsidiaries |
Amy D. Shelton (1964) | Chief Compliance Officer and Vice President since 2014 | Chief Compliance Officer, American Century funds, (March 2014 to present); Chief Compliance Officer, ACIM (February 2014 to present); Chief Compliance Officer, ACIS (October 2009 to present); Vice President, Client Interactions and Marketing, ACIS (February 2013 to January 2014); Director, Client Interactions and Marketing, ACIS (June 2007 to January 2013). Also serves as Vice President, ACIS |
Charles A. Etherington (1957) | General Counsel since 2007 and Senior Vice President since 2006 | Attorney, ACC (February 1994 to present); Vice President, ACC (November 2005 to present); General Counsel, ACC (March 2007 to present). Also serves as General Counsel, ACIM, ACS, ACIS and other ACC subsidiaries; and Senior Vice President, ACIM and ACS |
C. Jean Wade (1964) | Vice President, Treasurer and Chief Financial Officer since 2012 | Vice President, ACS (February 2000 to present) |
Robert J. Leach (1966) | Vice President since 2006 and Assistant Treasurer since 2012 | Vice President, ACS (February 2000 to present) |
David H. Reinmiller (1963) | Vice President since 2001 | Attorney, ACC (January 1994 to present); Associate General Counsel, ACC (January 2001 to present). Also serves as Vice President, ACIM and ACS |
Ward D. Stauffer (1960) | Secretary since 2005 | Attorney, ACC (June 2003 to present) |
38
Approval of Management Agreement |
At a meeting held on June 14, 2016, the Fund’s Board of Trustees (the "Board") unanimously approved the renewal of the management agreement pursuant to which American Century Investment Management, Inc. (the “Advisor”) acts as the investment advisor for the Fund. Under Section 15(c) of the Investment Company Act, contracts for investment advisory services are required to be reviewed, evaluated, and approved by a majority of a fund’s directors/trustees, including a majority of the independent Trustees, each year. The Board regards this annual evaluation and renewal as one of its most important responsibilities.
The independent Trustees have memorialized a statement regarding the relationship between their ongoing obligations to oversee and evaluate the performance of the Advisor and their annual consideration of renewal of the management agreement. In that statement, the independent Trustees noted that their assessment of the Advisor’s performance is an ongoing process that takes place over the entire year and is informed by all of the extensive information that the Board and its committees receive and consider over time. This information, together with the additional materials provided specifically in connection with the review, are central to the Board’s assessment of the Advisor’s performance and its determination whether to renew the Fund’s management agreement.
Prior to its consideration of the renewal of the management agreement, the Board requested and reviewed extensive data and analysis relating to the proposed renewal. This information and analysis was compiled by the Advisor and certain independent providers of evaluation data concerning the Fund and the services provided to the Fund by the Advisor.
In connection with its consideration of the renewal of the management agreement, the Board’s review and evaluation of the services provided by the Advisor included, but was not limited to, the following:
• | the nature, extent, and quality of investment management, shareholder services, and other services provided by the Advisor to the Fund; |
• | the wide range of other programs and services the Advisor provides to the Fund and its shareholders on a routine and non-routine basis; |
• | the investment performance of the Fund, including data comparing the Fund’s performance to appropriate benchmarks and/or a peer group of other mutual funds with similar investment objectives and strategies; |
• | the cost of owning the Fund compared to the cost of owning similar funds; |
• | the Advisor’s compliance policies, procedures, and regulatory experience; |
• | financial data showing the cost of services provided to the Fund, the profitability of the Fund to the Advisor, and the overall profitability of the Advisor; |
• | possible economies of scale associated with the Advisor’s management of the Fund and other accounts under its management; |
• | data comparing services provided and charges to other investment management clients of the Advisor; |
• | acquired fund fees and expenses; |
• | payments by the Fund and the Advisor to financial intermediaries whose clients are investors in the Fund; and |
• | any collateral benefits derived by the Advisor from the management of the Fund. |
In keeping with its practice, the Board held two in-person meetings to review and discuss the information provided in response to their request. The independent Trustees also had the benefit of the advice of their independent counsel throughout the process.
39
Factors Considered
The Trustees considered all of the information provided by the Advisor, the independent data providers, and the independent Trustees’ independent counsel in connection with the approval. They determined that the information was sufficient for them to evaluate the management agreement for the Fund. In connection with their review, the Trustees did not identify any single factor as being all-important or controlling and each Trustee may have attributed different levels of importance to different factors. In deciding to renew the management agreement, the Board based its decision on a number of factors, including the following:
Nature, Extent and Quality of Services - Generally. Under the management agreement, the Advisor is responsible for providing or arranging for all services necessary for the operation of the Fund. The Board noted that under the management agreement, the Advisor provides or arranges at its own expense a wide variety of services including:
• | constructing and designing the Fund |
• | portfolio research and security selection |
• | initial capitalization/funding |
• | securities trading |
• | Fund administration |
• | custody of Fund assets |
• | daily valuation of the Fund’s portfolio |
• | shareholder servicing and transfer agency, including shareholder confirmations, recordkeeping, and communications |
• | legal services (except the independent Trustees’ counsel) |
• | regulatory and portfolio compliance |
• | financial reporting |
• | marketing and distribution (except amounts paid by the Fund under Rule 12b-1 plans) |
The Board noted that many of these services have expanded over time in terms of both quantity and complexity in response to shareholder demands, competition in the industry, changing distribution channels, and the changing regulatory environment.
Investment Management, Shareholder, and Other Services. The nature of the investment management services provided to the Fund is quite complex and allows Fund shareholders access to professional money management, instant diversification of their investments within an asset class, the opportunity to easily diversify among asset classes by investing in or exchanging among various American Century Investments funds, and liquidity. In evaluating investment performance, the Board expects the Advisor to manage the Fund in accordance with its investment objectives and approved strategies. Further, the Trustees recognize that the Advisor has an obligation to seek the best execution of fund trades. In providing these services, the Advisor utilizes teams of investment professionals (portfolio managers, analysts, research assistants, and securities traders) who require extensive information technology, research, training, compliance, and other systems to conduct their business. The Board, directly and through its Portfolio Committee, regularly reviews investment performance information for the Fund, together with comparative information for appropriate benchmarks and/or peer groups of similarly-managed funds, over different time horizons. The Trustees also review detailed performance information during the management agreement approval process. If performance concerns are identified, the Fund receives special reviews until performance improves, during which the Board discusses with the Advisor the reasons for such results (e.g., market conditions, security selection) and any efforts being undertaken to improve performance. The Fund’s performance was below its benchmark for the one-, three-, five-, and ten-year periods reviewed by the Board. The Board discussed the Fund’s performance with the Advisor and was satisfied with the efforts being undertaken by the Advisor. The Board found the investment management services provided by the Advisor to the Fund to be satisfactory and consistent with the management agreement.
40
Under the management agreement, the Advisor provides the Fund with a comprehensive package of transfer agency, shareholder, and other services. The Board, directly and through various committees of the Board, regularly reviews reports and evaluations of such services at its regular meetings. These reports include, but are not limited to, information regarding the operational efficiency and accuracy of the shareholder and transfer agency services provided, staffing levels, shareholder satisfaction (as measured by external as well as internal sources), technology support, new products and services offered to Fund shareholders, securities trading activities, portfolio valuation services, auditing services, and legal and operational compliance activities. Certain aspects of shareholder and transfer agency service level efficiency and the quality of securities trading activities are measured by independent third party providers and are presented in comparison to other fund groups not managed by the Advisor.
The Board found the services provided by the Advisor to the Fund under the management agreement to be competitive and of high quality.
Costs of Services and Profitability. The Advisor provides detailed information concerning its cost of providing various services to the Fund, its profitability in managing the Fund, its overall profitability, and its financial condition. The Trustees have reviewed with the Advisor the methodology used to prepare this financial information. This information is considered in evaluating the Advisor’s financial condition, its ability to continue to provide services under the management agreement, and the reasonableness of the current management fee. The Board concluded that the Advisor’s profits were reasonable in light of the services provided to the Fund.
Economies of Scale. The Board also reviewed information provided by the Advisor regarding the possible existence of economies of scale in connection with the management of the Fund. The Board concluded that economies of scale are difficult to measure and predict with precision, especially on a fund-by-fund basis. The Board concluded that the Advisor is appropriately sharing economies of scale through its competitive fee structure, offering competitive fees from fund inception, and through reinvestment in its business to provide shareholders enhanced and expanded services.
Comparison to Other Funds’ Fees. The management agreement provides that the Fund pays the Advisor a single, all-inclusive (or unified) management fee for providing all services necessary for the management and operation of the Fund, other than brokerage expenses, expenses attributable to short sales, taxes, interest, extraordinary expenses, the fees and expenses of the Fund’s independent Trustees (including their independent legal counsel), and expenses incurred in connection with the provision of shareholder services and distribution services under a plan adopted pursuant to Rule 12b-1 under the 1940 Act. Under the unified fee structure, the Advisor is responsible for providing all investment advisory, custody, audit, administrative, compliance, recordkeeping, marketing, and shareholder services, or arranging and supervising third parties to provide such services. By contrast, most other funds are charged a variety of fees, including an investment advisory fee, a transfer agency fee, an administrative fee, distribution charges, and other expenses. Other than their investment advisory fees and any applicable Rule 12b-1 fees, all other components of the total fees charged by these other funds may be increased without shareholder approval. The Board believes the unified fee structure is a benefit to Fund shareholders because it clearly discloses to shareholders the cost of owning Fund shares, and, since the unified fee cannot be increased without a vote of Fund shareholders, it shifts to the Advisor the risk of increased costs of operating the Fund and provides a direct incentive to minimize administrative inefficiencies. Part of the Board’s analysis of fee levels involves reviewing certain evaluative data compiled by an independent provider and comparing the Fund’s unified fee to the total expense ratio of peer funds. The unified fee charged to shareholders of the Fund was below the median of the total expense ratios of the Fund’s peer group. The Board concluded that the management fee paid by the Fund to the Advisor under the management agreement is reasonable in light of the services provided to the Fund.
41
Comparison to Fees and Services Provided to Other Clients of the Advisor. The Board also requested and received information from the Advisor concerning the nature of the services, fees, costs, and profitability of its advisory services to advisory clients other than the Fund. They observed that these varying types of client accounts require different services and involve different regulatory and entrepreneurial risks than the management of the Fund. The Board analyzed this information and concluded that the fees charged and services provided to the Fund were reasonable by comparison.
Payments to Intermediaries. The Trustees also requested and received a description of payments made to intermediaries by the Fund and the Advisor. These payments include various payments made by the Fund or the Advisor to different types of intermediaries and recordkeepers for distribution and service activities provided for the Fund.
Collateral or “Fall-Out” Benefits Derived by the Advisor. The Board considered the existence of collateral benefits the Advisor may receive as a result of its relationship with the Fund. The Board noted that the Advisor’s primary business is managing mutual funds and it generally does not use fund or shareholder information to generate profits in other lines of business, and therefore does not derive any significant collateral benefits from them. The Board noted that the Advisor receives proprietary research from broker-dealers that execute fund portfolio transactions. The Board also determined that the Advisor is able to provide investment management services to certain clients other than the Fund, at least in part, due to its existing infrastructure built to serve the fund complex. The Board concluded, however, that the assets of those other clients are not material to the analysis and, where applicable, may be included with the assets of the Fund to determine breakpoints in the management fee schedule.
Existing Relationship. The Board also considered whether there was any reason for not continuing the existing arrangement with the Advisor. In this regard, the Board was mindful of the potential disruptions of the Fund’s operations and various risks, uncertainties, and other effects that could occur as a result of a decision not to continue such relationship. In particular, the Board recognized that most shareholders have invested in the Fund on the strength of the Advisor’s industry standing and reputation and in the expectation that the Advisor will have a continuing role in providing advisory services to the Fund.
Conclusion of the Trustees. As a result of this process, the Board, including all of the independent Trustees and assisted by the advice of independent legal counsel, taking into account all of the factors discussed above and the information provided by the Advisor and others in connection with its review and throughout the year, concluded that the management agreement between the Fund and the Advisor is fair and reasonable in light of the services provided and should be renewed.
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Proxy Voting Results |
A special meeting of shareholders was held on June 13, 2016, to vote on the following proposal. The proposal received the required number of votes and was adopted. A summary of voting results is listed below.
To elect four trustees to the Board of Trustees of American Century California Tax-Free and Municipal Funds:
Affirmative | Withhold | ||||||
Tanya S. Beder | $ | 2,491,173,919 | $ | 48,905,981 | |||
Jeremy I. Bulow | $ | 2,490,850,243 | $ | 49,229,657 | |||
Anne Casscells | $ | 2,491,569,613 | $ | 48,510,287 | |||
Jonathan D. Levin | $ | 2,491,165,182 | $ | 48,914,718 |
The other trustees whose term of office continued after the meeting include Jonathan S. Thomas, Ronald J. Gilson, Frederick L. A. Grauer, Peter F. Pervere and John B. Shoven.
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Additional Information |
Proxy Voting Policies
Descriptions of the principles and policies that the fund's investment advisor uses in exercising the voting rights associated with the securities purchased and/or held by the fund are available without charge, upon request, by calling 1-800-345-2021 or visiting the "About Us" page of American Century Investments’ website at americancentury.com. A description of the policies is also available on the Securities and Exchange Commission’s website at sec.gov. Information regarding how the investment advisor voted proxies relating to portfolio securities during the most recent 12-month period ended June 30 is available on the "About Us" page at americancentury.com. It is also available at sec.gov.
Quarterly Portfolio Disclosure
The fund 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 Forms N-Q are available on the SEC’s website at sec.gov, and may be reviewed and copied at the SEC’s Public Reference Room in Washington, DC. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330. The fund also makes its complete schedule of portfolio holdings for the most recent quarter of its fiscal year available on its website at americancentury.com and, upon request, by calling 1-800-345-2021.
Other Tax Information
The following information is provided pursuant to provisions of the Internal Revenue Code.
The fund designates $34,019,969 as exempt interest dividends for the fiscal year ended August 31, 2016.
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Contact Us | americancentury.com | |
Automated Information Line | 1-800-345-8765 | |
Investor Services Representative | 1-800-345-2021 or 816-531-5575 | |
Investors Using Advisors | 1-800-378-9878 | |
Business, Not-For-Profit, Employer-Sponsored Retirement Plans | 1-800-345-3533 | |
Banks and Trust Companies, Broker-Dealers, Financial Professionals, Insurance Companies | 1-800-345-6488 | |
Telecommunications Relay Service for the Deaf | 711 | |
American Century California Tax-Free and Municipal Funds | ||
Investment Advisor: American Century Investment Management, Inc. Kansas City, Missouri | ||
This report and the statements it contains are submitted for the general information of our shareholders. The report is not authorized for distribution to prospective investors unless preceded or accompanied by an effective prospectus. | ||
©2016 American Century Proprietary Holdings, Inc. All rights reserved. CL-ANN-90325 1610 |
ITEM 2. CODE OF ETHICS.
(a) | The registrant has adopted a Code of Ethics for Senior Financial Officers that applies to the registrant’s principal executive officer, principal financial officer, principal accounting officer, and persons performing similar functions. |
(b) | No response required. |
(c) | None. |
(d) | None. |
(e) | Not applicable. |
(f) | The registrant’s Code of Ethics for Senior Financial Officers was filed as Exhibit 12 (a)(1) to American Century Asset Allocation Portfolios, Inc.’s Annual Certified Shareholder Report on Form N-CSR, File No. 811-21591, on September 29, 2005, and is incorporated herein by reference. |
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1) | The registrant's board has determined that the registrant has at least one audit committee financial expert serving on its audit committee. |
(a)(2) | Tanya S. Beder, Anne Casscells, Peter F. Pervere and Ronald J. Gilson are the registrant's designated audit committee financial experts. They are "independent" as defined in Item 3 of Form N-CSR. |
(a)(3) | Not applicable. |
(b) | No response required. |
(c) | No response required. |
(d) | No response required. |
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a) | Audit Fees. |
The aggregate fees billed for each of the last two fiscal years for professional services rendered by the principal accountant for the audit of the registrant’s annual financial statements or services that are normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years were as follows:
FY 2015: $113,068
FY 2016: $117,940
(b) | Audit-Related Fees. |
The aggregate fees billed in each of the last two fiscal years for assurance and related services by the principal accountant that are reasonably related to the performance of the audit of the registrant’s financial statements and are not reported under paragraph (a) of this Item were as follows:
For services rendered to the registrant:
FY 2015: $0
FY 2016: $0
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X (relating to certain engagements for non-audit services with the registrant’s investment adviser and its affiliates):
FY 2015: $0
FY 2016: $0
(c) | Tax Fees. |
The aggregate fees billed in each of the last two fiscal years for professional services rendered by the principal accountant for tax compliance, tax advice, and tax planning were as follows:
For services rendered to the registrant:
FY 2015: $0
FY 2016: $0
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X (relating to certain engagements for non-audit services with the registrant’s investment adviser and its affiliates):
FY 2015: $0
FY 2016: $0
(d) | All Other Fees. |
The aggregate fees billed in each of the last two fiscal years for products and services provided by the principal accountant, other than the services reported in paragraphs (a) through (c) of this Item were as follows:
For services rendered to the registrant:
FY 2015: $0
FY 2016: $0
Fees required to be approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X (relating to certain engagements for non-audit services with the registrant’s investment adviser and its affiliates):
FY 2015: $0
FY 2016: $0
(e)(1) | In accordance with paragraph (c)(7)(i)(A) of Rule 2-01 of Regulation S-X, before the accountant is engaged by the registrant to render audit or non-audit services, the engagement is approved by the registrant’s audit committee. Pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X, the registrant’s audit committee also pre-approves its accountant’s engagements for non-audit services with the registrant’s investment adviser, its parent company, and any entity controlled by, or under common control with the investment adviser that provides ongoing services to the registrant, if the engagement relates directly to the operations and financial reporting of the registrant. |
(e)(2) | All services described in each of paragraphs (b) through (d) of this Item were pre-approved before the engagement by the registrant’s audit committee pursuant to paragraph (c)(7)(i)(A) of Rule 2-01 of Regulation S-X. Consequently, none of such services were required to be approved by the audit committee pursuant to paragraph (c)(7)(i)(C). |
(f) | The percentage of hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time, permanent employees was less than 50%. |
(g) | The aggregate non-audit fees billed by the registrant’s accountant for services rendered to the registrant, and rendered to the registrant’s investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the adviser that provides ongoing services to the registrant for each of the last two fiscal years of the registrant were as follows: |
FY 2015: $313,694
FY 2016: $167,395
(h) | The registrant’s investment adviser and accountant have notified the registrant’s audit committee of all non-audit services that were rendered by the registrant’s accountant to the registrant’s investment adviser, its parent company, and any entity controlled by, or under common control with the investment adviser that provides services to the registrant, which services were not required to be pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X. The notification provided to the registrant’s audit committee included sufficient details regarding such services to allow the registrant’s audit committee to consider the continuing independence of its principal accountant. |
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. INVESTMENTS.
(a) | The schedule of investments is included as part of the report to stockholders filed under Item 1 of this Form. |
(b) | Not applicable. |
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.
During the reporting period, there were no material changes to the procedures by which shareholders may recommend nominees to the registrant’s board.
ITEM 11. CONTROLS AND PROCEDURES.
(a) | The registrant's principal executive officer and principal financial officer have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) are effective based on their evaluation of these controls and procedures as of a date within 90 days of the filing date of this report. |
(b) | There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) that occurred during the registrant's 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.
(a)(1) | Registrant’s Code of Ethics for Senior Financial Officers, which is the subject of the disclosure required by Item 2 of Form N-CSR, was filed as Exhibit 12(a)(1) to American Century Asset Allocation Portfolios, Inc.’s Certified Shareholder Report on Form N-CSR, File No. 811-21591, on September 29, 2005. |
(a)(2) | Separate certifications by the registrant’s principal executive officer and principal financial officer, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 and Rule 30a-2(a) under the Investment Company Act of 1940, are filed and attached hereto as EX-99.CERT. |
(a)(3) | Not applicable. |
(b) | A certification by the registrant’s chief executive officer and chief financial officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, is furnished and attached hereto as EX-99.906CERT. |
SIGNATURES
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.
Registrant: | American Century California Tax-Free and Municipal Funds | |||
By: | /s/ Jonathan S. Thomas | |||
Name: | Jonathan S. Thomas | |||
Title: | President | |||
Date: | October 25, 2016 |
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/ Jonathan S. Thomas | |
Name: | Jonathan S. Thomas | |
Title: | President | |
(principal executive officer) | ||
Date: | October 25, 2016 |
By: | /s/ C. Jean Wade | |
Name: | C. Jean Wade | |
Title: | Vice President, Treasurer, and | |
Chief Financial Officer | ||
(principal financial officer) | ||
Date: | October 25, 2016 |