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- 05979
John Hancock California Tax-Free Income Fund (Exact name of registrant as specified in charter)
200 Berkeley Street, Boston, Massachusetts 02116 (Address of principal executive offices) (Zip code)
Salvatore Schiavone
Treasurer
200 Berkeley Street
Boston, Massachusetts 02116
(Name and address of agent for service) Registrant's telephone number, including area code: 617-543-9634
Date of fiscal year end: | May 31 |
Date of reporting period: | November 30, 2021 |
ITEM 1. REPORTS TO STOCKHOLDERS.
President and CEO,
John Hancock Investment Management
Head of Wealth and Asset Management,
United States and Europe
SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 1 |
2 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT |
SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 3 |
4 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT |
Average annual total returns (%) with maximum sales charge | Cumulative total returns (%) with maximum sales charge | SEC 30-day yield (%) subsidized | SEC 30-day yield (%) unsubsidized† | Tax- equivalent subsidized yield (%)† | ||||||
1-year | 5-year | 10-year | 6-month | 5-year | 10-year | as of 11-30-21 | as of 11-30-21 | as of 11-30-21 | ||
Class A | -1.12 | 3.40 | 3.86 | -3.20 | 18.19 | 46.08 | 0.95 | 0.94 | 2.07 | |
Class C | 1.26 | 3.47 | 3.51 | -0.54 | 18.59 | 41.15 | 0.25 | 0.14 | 0.54 | |
Class I1,2 | 3.18 | 4.39 | 4.36 | 0.81 | 23.98 | 53.18 | 1.14 | 1.13 | 2.48 | |
Class R61,2 | 3.22 | 4.41 | 4.36 | 0.92 | 24.06 | 53.28 | 1.17 | 1.16 | 2.55 | |
Index 1†† | 1.44 | 4.32 | 4.18 | 0.62 | 23.58 | 50.63 | — | — | — | |
Index 2†† | 1.97 | 4.38 | 3.90 | 0.56 | 23.91 | 46.65 | — | — | — |
Class A | Class C | Class I | Class R6 | |
Gross (%) | 0.85 | 1.70 | 0.70 | 0.66 |
Net (%) | 0.84 | 1.59 | 0.69 | 0.65 |
SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 5 |
Start date | With maximum sales charge ($) | Without sales charge ($) | Index 1 ($) | Index 2 ($) | |
Class C3 | 11-30-11 | 14,115 | 14,115 | 15,063 | 14,665 |
Class I1,2 | 11-30-11 | 15,318 | 15,318 | 15,063 | 14,665 |
Class R61,2 | 11-30-11 | 15,328 | 15,328 | 15,063 | 14,665 |
1 | Class I shares and Class R6 shares were first offered on 2-13-17 and 8-30-17, respectively. Returns prior to these dates are those of Class A shares that have not been adjusted for class-specific expenses; otherwise, returns would vary. |
2 | For certain types of investors, as described in the fund’s prospectus. |
3 | The contingent deferred sales charge is not applicable. |
6 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT |
SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 7 |
Account value on 6-1-2021 | Ending value on 11-30-2021 | Expenses paid during period ended 11-30-20211 | Annualized expense ratio | ||
Class A | Actual expenses/actual returns | $1,000.00 | $1,008.30 | $4.13 | 0.82% |
Hypothetical example | 1,000.00 | 1,021.00 | 4.15 | 0.82% | |
Class C | Actual expenses/actual returns | 1,000.00 | 1,004.50 | 7.89 | 1.57% |
Hypothetical example | 1,000.00 | 1,017.20 | 7.94 | 1.57% | |
Class I | Actual expenses/actual returns | 1,000.00 | 1,008.10 | 3.37 | 0.67% |
Hypothetical example | 1,000.00 | 1,021.70 | 3.40 | 0.67% | |
Class R6 | Actual expenses/actual returns | 1,000.00 | 1,009.20 | 3.22 | 0.64% |
Hypothetical example | 1,000.00 | 1,021.90 | 3.24 | 0.64% |
1 | Expenses are equal to the annualized expense ratio, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period). |
8 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT |
Rate (%) | Maturity date | Par value^ | Value | ||
Municipal bonds 98.9% | $213,586,209 | ||||
(Cost $198,793,827) | |||||
California 96.7% | 208,890,665 | ||||
ABAG Finance Authority for Nonprofit Corporations Sharp HealthCare, Series A | 5.000 | 08-01-43 | 2,000,000 | 2,147,484 | |
Bay Area Water Supply & Conservation Agency Capital Cost Recovery (A) | 5.000 | 10-01-34 | 1,500,000 | 1,927,539 | |
Burbank Unified School District Convertible Capital Appreciation Election 2013, GO (0.000% to 8-1-23, then 4.500% thereafter) | 0.000 | 08-01-37 | 1,770,000 | 1,944,539 | |
California Community Housing Agency Essential Housing Revenue Stoneridge Apartments, Series A (B) | 4.000 | 02-01-56 | 600,000 | 625,236 | |
California Community Housing Agency Verdant at Green Valley Project, Series A (B) | 5.000 | 08-01-49 | 1,000,000 | 1,107,106 | |
California County Tobacco Securitization Agency Fresno County Funding Corp. | 6.000 | 06-01-35 | 1,305,000 | 1,307,271 | |
California County Tobacco Securitization Agency Kern County Tobacco Funding Corp. | 5.000 | 06-01-40 | 1,500,000 | 1,582,774 | |
California County Tobacco Securitization Agency Merced County Tobacco Funding Corp. | 5.000 | 06-01-50 | 485,000 | 575,706 | |
California County Tobacco Securitization Agency Sonoma County Securitization Corp. | 4.000 | 06-01-49 | 1,400,000 | 1,625,758 | |
California County Tobacco Securitization Agency Tobacco Settlement Revenue, Series A | 4.000 | 06-01-49 | 1,000,000 | 1,161,936 | |
California Educational Facilities Authority Pepperdine University | 5.000 | 10-01-49 | 1,500,000 | 1,738,321 | |
California Educational Facilities Authority University of Redlands, Series A | 5.000 | 10-01-35 | 1,000,000 | 1,107,221 | |
California Enterprise Development Authority Academy for Academic Excellence Project, Series A (B) | 5.000 | 07-01-40 | 430,000 | 485,184 | |
California Enterprise Development Authority Academy for Academic Excellence Project, Series A (B) | 5.000 | 07-01-50 | 350,000 | 391,436 | |
California Enterprise Development Authority Academy for Academic Excellence Project, Series A (B) | 5.000 | 07-01-55 | 240,000 | 267,361 | |
California Health Facilities Financing Authority Children’s Hospital, Series A | 5.000 | 08-15-47 | 1,000,000 | 1,185,691 | |
California Health Facilities Financing Authority City of Hope Obligated Group | 4.000 | 11-15-45 | 1,000,000 | 1,163,227 | |
California Health Facilities Financing Authority CommonSpirit Health Obligated Group, Series A | 4.000 | 04-01-40 | 1,500,000 | 1,776,250 | |
California Health Facilities Financing Authority El Camino Hospital | 5.000 | 02-01-42 | 1,000,000 | 1,204,656 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 9 |
Rate (%) | Maturity date | Par value^ | Value | ||
California (continued) | |||||
California Health Facilities Financing Authority El Camino Hospital | 5.000 | 02-01-47 | 1,425,000 | $1,708,649 | |
California Health Facilities Financing Authority Lucile Packard Children’s Hospital, Series A | 5.000 | 08-15-43 | 1,000,000 | 1,114,530 | |
California Health Facilities Financing Authority Lucile Packard Children’s Hospital, Series B | 5.000 | 08-15-55 | 1,000,000 | 1,177,047 | |
California Health Facilities Financing Authority Standford Health Care, Series A | 4.000 | 08-15-50 | 1,000,000 | 1,172,072 | |
California Housing Finance Series A | 4.250 | 01-15-35 | 967,209 | 1,162,795 | |
California Infrastructure & Economic Development Bank Sustainability Bonds, California Science Center Phase III | 4.000 | 05-01-36 | 1,000,000 | 1,204,740 | |
California Municipal Finance Authority Channing House Project, Series A (C) | 4.000 | 05-15-40 | 1,500,000 | 1,690,023 | |
California Municipal Finance Authority HumanGood Obligated Group, Series A | 5.000 | 10-01-44 | 1,000,000 | 1,182,697 | |
California Municipal Finance Authority Paradise Valley Estates Project, Series A (C) | 5.000 | 01-01-49 | 1,500,000 | 1,816,915 | |
California Municipal Finance Authority Retirement Housing Foundation Obligation Group, Series A | 5.000 | 11-15-31 | 1,500,000 | 1,862,259 | |
California Municipal Finance Authority West Village Student Housing Project at UC Davis (C) | 4.000 | 05-15-48 | 1,365,000 | 1,560,138 | |
California Municipal Finance Authority Wineville School Project, Series A (C) | 5.000 | 10-01-42 | 2,000,000 | 2,252,876 | |
California Pollution Control Financing Authority San Diego County Water Authority Desalination Project Pipeline (B) | 5.000 | 07-01-39 | 1,000,000 | 1,202,983 | |
California Pollution Control Financing Authority San Diego County Water Authority Desalination Project Pipeline (B) | 5.000 | 11-21-45 | 1,500,000 | 1,782,617 | |
California Pollution Control Financing Authority Waste Management, Inc., Series A1, AMT | 3.375 | 07-01-25 | 1,000,000 | 1,091,821 | |
California Pollution Control Financing Authority Waste Management, Inc., Series A3, AMT | 4.300 | 07-01-40 | 4,675,000 | 5,239,061 | |
California Public Finance Authority Enso Village Project, Series A (B) | 5.000 | 11-15-51 | 700,000 | 801,917 | |
California Public Finance Authority Excelsior Charter Schools Project, Series A (B) | 5.000 | 06-15-50 | 500,000 | 544,265 | |
California Public Finance Authority Excelsior Charter Schools Project, Series A (B) | 5.000 | 06-15-55 | 500,000 | 542,945 | |
California Public Finance Authority Henry Mayo Newhall Hospital | 5.000 | 10-15-47 | 2,000,000 | 2,330,405 | |
California Public Finance Authority Senior Living Revenue Refunding Enso Village Project, Series A (B) | 5.000 | 11-15-46 | 400,000 | 459,155 | |
California Public Finance Authority Trinity Classical Academy, Series A (B) | 5.000 | 07-01-44 | 110,000 | 116,098 |
10 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
Rate (%) | Maturity date | Par value^ | Value | ||
California (continued) | |||||
California Public Finance Authority Trinity Classical Academy, Series A (B) | 5.000 | 07-01-54 | 325,000 | $340,027 | |
California School Finance Authority Aspire Public School (B) | 5.000 | 08-01-46 | 110,000 | 128,000 | |
California School Finance Authority Aspire Public School (B) | 5.000 | 08-01-46 | 1,165,000 | 1,304,655 | |
California School Finance Authority College Housing Revenue | 4.000 | 11-01-51 | 1,000,000 | 1,083,222 | |
California School Finance Authority College Housing Revenue | 4.000 | 11-01-55 | 580,000 | 624,660 | |
California School Finance Authority Granada Hills Charter High School Obligated Group (B) | 5.000 | 07-01-43 | 1,000,000 | 1,137,883 | |
California School Finance Authority KIPP LA Project, Series A (B) | 5.000 | 07-01-47 | 1,500,000 | 1,737,204 | |
California State Public Works Board Various Capital Projects, Series A (A) | 5.000 | 08-01-36 | 1,000,000 | 1,298,617 | |
California State Public Works Board Various Correctional Facilities, Series A | 5.000 | 09-01-39 | 2,500,000 | 2,784,923 | |
California Statewide Communities Development Authority Adventist Health System, Series A | 5.000 | 03-01-48 | 1,885,000 | 2,281,630 | |
California Statewide Communities Development Authority CHF Irvine LLC | 5.000 | 05-15-40 | 1,485,000 | 1,719,860 | |
California Statewide Communities Development Authority Emanate Health, Series A | 4.000 | 04-01-45 | 250,000 | 289,666 | |
California Statewide Communities Development Authority Front Porch Communities and Services, Series A | 5.000 | 04-01-47 | 500,000 | 588,717 | |
California Statewide Communities Development Authority Infrastructure Program Revenue, Series B | 5.000 | 09-02-44 | 1,000,000 | 1,081,383 | |
California Statewide Communities Development Authority Redlands Community Hospital | 5.000 | 10-01-46 | 2,000,000 | 2,312,176 | |
California Statewide Communities Development Authority Redwoods Project (C) | 5.375 | 11-15-44 | 1,500,000 | 1,635,911 | |
California Statewide Communities Development Authority Statewide Community Infrastructure Program Revenue, Series A | 4.000 | 09-02-51 | 1,000,000 | 1,133,402 | |
California Statewide Financing Authority Tobacco Settlement, Series A | 6.000 | 05-01-37 | 2,435,000 | 2,445,892 | |
California Statewide Financing Authority Tobacco Settlement, Series B | 6.000 | 05-01-37 | 2,925,000 | 2,938,084 | |
Cascade Union Elementary School District Election 2016, Series A, GO (C) | 3.750 | 08-01-46 | 250,000 | 272,661 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 11 |
Rate (%) | Maturity date | Par value^ | Value | ||
California (continued) | |||||
City of Belmont Library Project, Series A (C) | 5.750 | 08-01-24 | 635,000 | $693,292 | |
City of Irvine Community Facilities District, No. 2013-3 Great Park | 5.000 | 09-01-49 | 2,000,000 | 2,199,784 | |
City of Long Beach Alamitos Bay Marina Project | 5.000 | 05-15-45 | 1,000,000 | 1,093,683 | |
City of Long Beach Community Facilities District 6-Pike Project | 6.250 | 10-01-26 | 1,540,000 | 1,545,303 | |
City of Long Beach Harbor Revenue, Series A | 5.000 | 05-15-49 | 2,000,000 | 2,511,587 | |
City of Los Angeles Community Facilities District Cascades Business Park | 6.400 | 09-01-22 | 85,000 | 85,799 | |
City of Los Angeles Department of Airports Los Angeles International Airport, Series C, AMT | 5.000 | 05-15-35 | 1,000,000 | 1,274,807 | |
City of Los Angeles Department of Airports Los Angeles International Airport, Series D, AMT | 4.000 | 05-15-44 | 2,000,000 | 2,281,381 | |
City of Sacramento Greenbriar Community Facilities District No. 2018-3 | 4.000 | 09-01-50 | 600,000 | 674,214 | |
City of San Clemente Community Facilities District, No. 2006-1 | 5.000 | 09-01-46 | 1,955,000 | 2,180,922 | |
City of San Mateo Community Facilities District, No. 2008-1 Bay Meadows | 5.500 | 09-01-44 | 2,000,000 | 2,056,510 | |
College of the Sequoias Tulare Area Improvement District No. 3 Election of 2008, Series B, GO (C)(D) | 2.216 | 08-01-40 | 2,890,000 | 1,908,058 | |
County of Sacramento Airport System Revenue | 4.000 | 07-01-39 | 1,000,000 | 1,186,946 | |
CSCDA Community Improvement Authority California Essential Housing Revenue Altana Glendale, Series A-2 (B) | 4.000 | 10-01-56 | 1,000,000 | 1,039,558 | |
CSCDA Community Improvement Authority California Essential Housing Revenue, Senior Pasadena Portfolio, Series A2 (B) | 3.000 | 12-01-56 | 800,000 | 727,020 | |
CSCDA Community Improvement Authority California Essential Housing Revenue, The Link Glendale, Series A2 (B) | 4.000 | 07-01-56 | 600,000 | 620,765 | |
CSCDA Community Improvement Authority Essential Housing Revenue Parallel Anaheim, Series A (B) | 4.000 | 08-01-56 | 1,000,000 | 1,034,845 | |
Foothill-Eastern Transportation Corridor Agency Highway Revenue Tolls, Series A | 5.750 | 01-15-46 | 3,000,000 | 3,343,036 | |
Golden State Tobacco Securitization Corp. California Tobacco Settlement Revenue, Series A1 | 5.000 | 06-01-31 | 1,000,000 | 1,226,115 | |
Golden State Tobacco Securitization Corp. Series A | 5.000 | 06-01-45 | 3,250,000 | 3,763,626 |
12 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
Rate (%) | Maturity date | Par value^ | Value | ||
California (continued) | |||||
Golden State Tobacco Securitization Corp. Series A-1 | 3.500 | 06-01-36 | 1,330,000 | $1,343,591 | |
Golden State Tobacco Securitization Corp. Series A-1 | 5.000 | 06-01-47 | 1,610,000 | 1,644,842 | |
Golden State Tobacco Securitization Corp. Tobacco Settlement Revenue, Series A | 5.000 | 06-01-40 | 2,250,000 | 2,605,587 | |
Golden State Tobacco Securitization Corp. Tobacco Settlement Revenue, Series A | 5.000 | 06-01-40 | 2,750,000 | 3,182,528 | |
Hastings Campus Housing Finance Authority California Campus Housing Revenue, Series A | 5.000 | 07-01-45 | 1,000,000 | 1,174,001 | |
Inglewood Unified School District Series A, GO (C) | 4.000 | 08-01-36 | 555,000 | 656,821 | |
Inglewood Unified School District Series A, GO (C) | 4.000 | 08-01-37 | 445,000 | 524,273 | |
Inland Valley Development Agency Series A | 5.000 | 09-01-44 | 2,500,000 | 2,716,650 | |
Liberty Union High School District Election 2016, Series B, GO | 3.000 | 08-01-41 | 1,670,000 | 1,806,464 | |
Los Angeles County Public Works Financing Authority Series D | 5.000 | 12-01-45 | 2,000,000 | 2,303,029 | |
Los Angeles County Regional Financing Authority Montecedro, Inc. Project, Series A (C) | 5.000 | 11-15-44 | 1,355,000 | 1,405,136 | |
Los Angeles Department of Water Power Waterworks Revenue, Series A | 5.000 | 07-01-50 | 1,000,000 | 1,283,583 | |
Los Angeles Department of Water & Power Power Systems, Series D | 5.000 | 07-01-44 | 1,000,000 | 1,109,685 | |
Los Angeles Unified School District Series RYQ, GO | 4.000 | 07-01-44 | 1,500,000 | 1,774,975 | |
Lower Tule River Irrigation District Series A | 5.000 | 08-01-28 | 875,000 | 1,090,905 | |
Marin Healthcare District Election of 2013, GO | 4.000 | 08-01-45 | 1,000,000 | 1,105,412 | |
Metropolitan Water District of Southern California Series A | 5.000 | 10-01-49 | 1,500,000 | 1,909,757 | |
Mount Diablo Unified School District Series B, GO (A) | 4.000 | 08-01-36 | 1,335,000 | 1,591,158 | |
M-S-R Energy Authority Natural Gas Revenue, Series B | 6.500 | 11-01-39 | 1,500,000 | 2,401,744 | |
Norman Y. Mineta San Jose International Airport SJC Series A, AMT | 5.000 | 03-01-47 | 1,500,000 | 1,776,288 | |
Oakland Unified School District Series A, GO | 5.000 | 08-01-40 | 1,500,000 | 1,744,031 | |
Orange County Community Facilities District 2017-1 Esencia Village, Series A | 5.000 | 08-15-47 | 2,000,000 | 2,372,978 | |
Pacifica School District Series C, GO (C)(D) | 1.036 | 08-01-26 | 1,000,000 | 952,357 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 13 |
Rate (%) | Maturity date | Par value^ | Value | ||
California (continued) | |||||
Port of Los Angeles Series A, AMT | 5.000 | 08-01-44 | 2,000,000 | $2,203,337 | |
River Islands Public Financing Authority Community Facilities District, No. 2003-1 | 5.500 | 09-01-45 | 750,000 | 784,364 | |
River Islands Public Financing Authority Community Facilities District, No. 2003-1, Series A | 5.000 | 09-01-48 | 1,250,000 | 1,435,606 | |
River Islands Public Financing Authority Lathrop Irrigation District Electric Revenue (C) | 4.000 | 09-01-35 | 1,125,000 | 1,335,687 | |
Riverside County Transportation Commission Series A | 5.750 | 06-01-48 | 1,000,000 | 1,080,485 | |
Sacramento Municipal Utility District Electric Revenue, Series H | 4.000 | 08-15-45 | 2,000,000 | 2,386,884 | |
San Diego Public Facilities Financing Authority Capital Improvement Projects, Series A | 5.000 | 10-15-44 | 1,000,000 | 1,143,730 | |
San Diego Public Facilities Financing Authority Series A | 3.000 | 08-01-49 | 1,500,000 | 1,610,491 | |
San Diego Public Facilities Financing Authority Series A | 4.000 | 08-01-45 | 500,000 | 596,765 | |
San Diego Unified School District Series I, GO (D) | 3.579 | 07-01-39 | 1,250,000 | 667,508 | |
San Francisco Bay Area Rapid Transit District Election 2016, Series C1, GO | 3.000 | 08-01-50 | 1,500,000 | 1,603,865 | |
San Francisco City & County Airport Commission International Airport Revenue, Second Series 2020-B | 4.000 | 05-01-37 | 1,215,000 | 1,444,462 | |
San Francisco City & County Airport Commission Special Facilities Lease, SFO Fuel Company LLC, Series A, AMT | 5.000 | 01-01-47 | 2,000,000 | 2,435,300 | |
San Francisco City & County Airport Commission (California) Series E, AMT | 5.000 | 05-01-50 | 1,500,000 | 1,836,393 | |
San Francisco City & County Public Utilities Commission Power Revenue Green Bonds, Series A | 5.000 | 11-01-45 | 1,500,000 | 1,710,068 | |
San Francisco City & County Redevelopment Successor Agency Department of General Services Lease, No. 6, Mission Bay South, Series A | 5.150 | 08-01-35 | 1,250,000 | 1,257,581 | |
San Francisco City & County Redevelopment Successor Agency Mission Bay Project, Series A | 5.000 | 08-01-43 | 1,000,000 | 1,109,167 | |
San Joaquin Hills Transportation Corridor Agency Highway Revenue Tolls, Series A | 5.000 | 01-15-44 | 2,500,000 | 2,794,450 | |
San Joaquin Regional Rail Commission Ace Maintenance Facility Project | 4.000 | 05-01-37 | 490,000 | 584,241 | |
San Joaquin Regional Rail Commission Ace Maintenance Facility Project | 4.000 | 05-01-38 | 460,000 | 546,966 | |
San Joaquin Regional Rail Commission Ace Maintenance Facility Project | 4.000 | 05-01-39 | 730,000 | 866,135 |
14 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
Rate (%) | Maturity date | Par value^ | Value | ||
California (continued) | |||||
Santa Ana Financing Authority Police Administration & Holding Facility, Series A (C) | 6.250 | 07-01-24 | 3,180,000 | $3,475,949 | |
Santa Ana Financing Authority Prerefunded, Police Administration & Holding Facility, Series A (C) | 6.250 | 07-01-24 | 3,180,000 | 3,475,159 | |
Santa Margarita Water District Community Facilities District, No. 2013-1 | 5.625 | 09-01-43 | 745,000 | 796,089 | |
Santee School District Election of 2006, Series E, GO (C)(D) | 2.755 | 05-01-51 | 1,530,000 | 679,937 | |
Solano California Irrigation District Water Revenue Certificates Participation | 4.000 | 08-01-51 | 1,000,000 | 1,173,690 | |
South Orange County Public Financing Authority Series A | 5.000 | 08-15-34 | 450,000 | 461,330 | |
South Placer Wastewater Authority California Wastewater Revenue Refunding | 5.000 | 11-01-34 | 430,000 | 604,087 | |
Southern California Public Power Authority Apex Power Project, Series A | 5.000 | 07-01-38 | 1,000,000 | 1,106,425 | |
Southern California Public Power Authority Natural Gas Project Revenue, Series A | 5.250 | 11-01-26 | 2,000,000 | 2,419,649 | |
State of California Construction Bonds, GO | 5.000 | 10-01-49 | 1,000,000 | 1,263,828 | |
State of California Various Purpose, GO | 3.000 | 03-01-50 | 1,500,000 | 1,604,064 | |
State of California Various Purpose, GO | 5.000 | 04-01-32 | 2,000,000 | 2,737,353 | |
Sweetwater Union High School District Ad Valorem Property Tax, GO | 4.000 | 08-01-42 | 500,000 | 536,616 | |
Three Rivers Levee Improvement Authority Special Tax Revenue Refunding Community Facilities District | 4.000 | 09-01-51 | 1,000,000 | 1,131,167 | |
Transbay Joint Powers Authority Tax Allocation, Series A | 5.000 | 10-01-32 | 345,000 | 443,926 | |
Turlock Irrigation District Electricity, Power & Light Revenues | 5.000 | 01-01-41 | 1,000,000 | 1,276,089 | |
University of California Series AZ | 5.000 | 05-15-48 | 1,500,000 | 1,848,402 | |
West Covina Community Development Commission Successor Agency Fashion Plaza | 6.000 | 09-01-22 | 855,000 | 888,889 | |
William S. Hart Union High School District Community Facilities District, No. 2015-1 | 5.000 | 09-01-47 | 1,000,000 | 1,132,208 | |
Puerto Rico 2.2% | 4,695,544 | ||||
Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, Series A-1 (D) | 2.291 | 07-01-31 | 1,500,000 | 1,203,494 | |
Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, Series A-1 (D) | 4.505 | 07-01-46 | 2,500,000 | 832,884 | |
Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, Series A-1 | 4.750 | 07-01-53 | 1,500,000 | 1,696,229 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 15 |
Rate (%) | Maturity date | Par value^ | Value | ||
Puerto Rico (continued) | |||||
Puerto Rico Sales Tax Financing Corp. Sales Tax Revenue, Series A-2 | 4.784 | 07-01-58 | 850,000 | $962,937 | |
Par value^ | Value | ||||
Short-term investments 2.4% | $5,222,000 | ||||
(Cost $5,222,000) | |||||
Repurchase agreement 2.4% | $5,222,000 | ||||
Repurchase Agreement with State Street Corp. dated 11-30-21 at 0.000% to be repurchased at $5,222,000 on 12-1-21, collateralized by $4,567,800 U.S. Treasury Inflation Indexed Notes, 0.625% due 4-15-23 (valued at $5,326,511) | 5,222,000 | 5,222,000 | |||
Total investments (Cost $204,015,827) 101.3% | $218,808,209 | ||||
Other assets and liabilities, net (1.3%) | (2,779,872) | ||||
Total net assets 100.0% | $216,028,337 |
The percentage shown for each investment category is the total value of the category as a percentage of the net assets of the fund. | |
^All par values are denominated in U.S. dollars unless otherwise indicated. | |
Security Abbreviations and Legend | |
AMT | Interest earned from these securities may be considered a tax preference item for purpose of the Federal Alternative Minimum Tax. |
GO | General Obligation |
(A) | Security purchased or sold on a when-issued or delayed delivery basis. |
(B) | These securities are exempt from registration under Rule 144A of the Securities Act of 1933. Such securities may be resold, normally to qualified institutional buyers, in transactions exempt from registration. |
(C) | Bond is insured by one or more of the companies listed in the insurance coverage table below. |
(D) | Zero coupon bonds are issued at a discount from their principal amount in lieu of paying interest periodically. Rate shown is the effective yield at period end. |
Insurance coverage | As a % of total investments |
National Public Finance Guarantee Corp. | 3.6 |
California Mortgage Insurance | 3.0 |
Assured Guaranty Municipal Corp. | 2.5 |
Build America Mutual Assurance Company | 1.7 |
Ambac Financial Group, Inc. | 0.3 |
TOTAL | 11.1 |
16 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
Open contracts | Number of contracts | Position | Expiration date | Notional basis^ | Notional value^ | Unrealized appreciation (depreciation) |
10-Year U.S. Treasury Note Futures | 137 | Short | Mar 2022 | $(17,698,438) | $(17,921,312) | $(222,874) |
$(222,874) |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 17 |
Assets | |
Unaffiliated investments, at value (Cost $204,015,827) | $218,808,209 |
Cash | 238 |
Collateral held at broker for futures contracts | 400,000 |
Interest receivable | 2,381,649 |
Receivable for fund shares sold | 86,191 |
Other assets | 18,311 |
Total assets | 221,694,598 |
Liabilities | |
Payable for futures variation margin | 72,781 |
Distributions payable | 53,663 |
Payable for delayed delivery securities purchased | 4,725,897 |
Payable for fund shares repurchased | 573,724 |
Payable to affiliates | |
Investment management fees | 97,673 |
Accounting and legal services fees | 10,768 |
Transfer agent fees | 7,200 |
Distribution and service fees | 22,376 |
Trustees’ fees | 170 |
Other liabilities and accrued expenses | 102,009 |
Total liabilities | 5,666,261 |
Net assets | $216,028,337 |
Net assets consist of | |
Paid-in capital | $198,178,772 |
Total distributable earnings (loss) | 17,849,565 |
Net assets | $216,028,337 |
Net asset value per share | |
Based on net asset value and shares outstanding - the fund has an unlimited number of shares authorized with no par value | |
Class A ($181,041,869 ÷ 16,445,473 shares)1 | $11.01 |
Class C ($9,732,717 ÷ 884,038 shares)1 | $11.01 |
Class I ($14,927,509 ÷ 1,355,342 shares) | $11.01 |
Class R6 ($10,326,242 ÷ 937,144 shares) | $11.02 |
Maximum offering price per share | |
Class A (net asset value per share ÷ 96%)2 | $11.47 |
1 | Redemption price per share is equal to net asset value less any applicable contingent deferred sales charge. |
2 | On single retail sales of less than $100,000. On sales of $100,000 or more and on group sales the offering price is reduced. |
18 | JOHN HANCOCK California Tax-Free Income Fund | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
Investment income | |
Interest | $3,650,493 |
Expenses | |
Investment management fees | 599,589 |
Distribution and service fees | 189,909 |
Accounting and legal services fees | 18,502 |
Transfer agent fees | 43,903 |
Trustees’ fees | 1,723 |
Custodian fees | 23,313 |
State registration fees | 6,968 |
Printing and postage | 10,152 |
Professional fees | 25,918 |
Other | 10,171 |
Total expenses | 930,148 |
Less expense reductions | (15,223) |
Net expenses | 914,925 |
Net investment income | 2,735,568 |
Realized and unrealized gain (loss) | |
Net realized gain (loss) on | |
Unaffiliated investments | 288,609 |
Futures contracts | 157,553 |
446,162 | |
Change in net unrealized appreciation (depreciation) of | |
Unaffiliated investments | (1,296,146) |
Futures contracts | (222,874) |
(1,519,020) | |
Net realized and unrealized loss | (1,072,858) |
Increase in net assets from operations | $1,662,710 |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK California Tax-Free Income Fund | 19 |
Six months ended 11-30-21 (unaudited) | Year ended 5-31-21 | |
Increase (decrease) in net assets | ||
From operations | ||
Net investment income | $2,735,568 | $5,795,361 |
Net realized gain | 446,162 | 2,336,645 |
Change in net unrealized appreciation (depreciation) | (1,519,020) | 5,666,332 |
Increase in net assets resulting from operations | 1,662,710 | 13,798,338 |
Distributions to shareholders | ||
From earnings | ||
Class A | (2,348,212) | (4,906,014) |
Class B | — | (2,166)1 |
Class C | (93,047) | (271,132) |
Class I | (189,640) | (371,152) |
Class R6 | (129,767) | (226,204) |
Total distributions | (2,760,666) | (5,776,668) |
From fund share transactions | 2,620,304 | (4,659,984) |
Total increase | 1,522,348 | 3,361,686 |
Net assets | ||
Beginning of period | 214,505,989 | 211,144,303 |
End of period | $216,028,337 | $214,505,989 |
1 | Share class was redesignated during the period. Refer to Note 6 for further details. |
20 | JOHN HANCOCK California Tax-Free Income Fund | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
CLASS A SHARES Period ended | 11-30-211 | 5-31-21 | 5-31-20 | 5-31-19 | 5-31-18 | 5-31-17 |
Per share operating performance | ||||||
Net asset value, beginning of period | $11.06 | $10.66 | $10.94 | $10.73 | $10.90 | $11.22 |
Net investment income2 | 0.14 | 0.30 | 0.34 | 0.36 | 0.36 | 0.37 |
Net realized and unrealized gain (loss) on investments | (0.05) | 0.40 | (0.20) | 0.22 | (0.16) | (0.30) |
Total from investment operations | 0.09 | 0.70 | 0.14 | 0.58 | 0.20 | 0.07 |
Less distributions | ||||||
From net investment income | (0.14) | (0.30) | (0.34) | (0.36) | (0.37) | (0.39) |
From net realized gain | — | — | (0.08) | (0.01) | — | — |
Total distributions | (0.14) | (0.30) | (0.42) | (0.37) | (0.37) | (0.39) |
Net asset value, end of period | $11.01 | $11.06 | $10.66 | $10.94 | $10.73 | $10.90 |
Total return (%)3,4 | 0.835 | 6.64 | 1.22 | 5.57 | 1.85 | 0.63 |
Ratios and supplemental data | ||||||
Net assets, end of period (in millions) | $181 | $181 | $173 | $176 | $181 | $213 |
Ratios (as a percentage of average net assets): | ||||||
Expenses before reductions | 0.836 | 0.85 | 0.85 | 0.86 | 0.85 | 0.83 |
Expenses including reductions | 0.826 | 0.84 | 0.84 | 0.85 | 0.84 | 0.83 |
Net investment income | 2.536 | 2.76 | 3.12 | 3.42 | 3.37 | 3.35 |
Portfolio turnover (%) | 5 | 23 | 22 | 22 | 9 | 17 |
1 | Six months ended 11-30-21. Unaudited. |
2 | Based on average daily shares outstanding. |
3 | Total returns would have been lower had certain expenses not been reduced during the applicable periods. |
4 | Does not reflect the effect of sales charges, if any. |
5 | Not annualized. |
6 | Annualized. |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK California Tax-Free Income Fund | 21 |
CLASS C SHARES Period ended | 11-30-211 | 5-31-21 | 5-31-20 | 5-31-19 | 5-31-18 | 5-31-17 |
Per share operating performance | ||||||
Net asset value, beginning of period | $11.06 | $10.66 | $10.94 | $10.73 | $10.90 | $11.22 |
Net investment income2 | 0.10 | 0.22 | 0.26 | 0.28 | 0.28 | 0.29 |
Net realized and unrealized gain (loss) on investments | (0.05) | 0.40 | (0.20) | 0.22 | (0.16) | (0.31) |
Total from investment operations | 0.05 | 0.62 | 0.06 | 0.50 | 0.12 | (0.02) |
Less distributions | ||||||
From net investment income | (0.10) | (0.22) | (0.26) | (0.28) | (0.29) | (0.30) |
From net realized gain | — | — | (0.08) | (0.01) | — | — |
Total distributions | (0.10) | (0.22) | (0.34) | (0.29) | (0.29) | (0.30) |
Net asset value, end of period | $11.01 | $11.06 | $10.66 | $10.94 | $10.73 | $10.90 |
Total return (%)3,4 | 0.455 | 5.85 | 0.47 | 4.78 | 1.09 | (0.13) |
Ratios and supplemental data | ||||||
Net assets, end of period (in millions) | $10 | $11 | $16 | $19 | $21 | $30 |
Ratios (as a percentage of average net assets): | ||||||
Expenses before reductions | 1.686 | 1.70 | 1.70 | 1.71 | 1.70 | 1.68 |
Expenses including reductions | 1.576 | 1.59 | 1.59 | 1.60 | 1.59 | 1.58 |
Net investment income | 1.786 | 2.02 | 2.37 | 2.67 | 2.62 | 2.60 |
Portfolio turnover (%) | 5 | 23 | 22 | 22 | 9 | 17 |
1 | Six months ended 11-30-21. Unaudited. |
2 | Based on average daily shares outstanding. |
3 | Total returns would have been lower had certain expenses not been reduced during the applicable periods. |
4 | Does not reflect the effect of sales charges, if any. |
5 | Not annualized. |
6 | Annualized. |
22 | JOHN HANCOCK California Tax-Free Income Fund | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
CLASS I SHARES Period ended | 11-30-211 | 5-31-21 | 5-31-20 | 5-31-19 | 5-31-18 | 5-31-172 |
Per share operating performance | ||||||
Net asset value, beginning of period | $11.07 | $10.66 | $10.94 | $10.73 | $10.91 | $10.70 |
Net investment income3 | 0.15 | 0.32 | 0.35 | 0.38 | 0.38 | 0.12 |
Net realized and unrealized gain (loss) on investments | (0.06) | 0.41 | (0.20) | 0.22 | (0.17) | 0.21 |
Total from investment operations | 0.09 | 0.73 | 0.15 | 0.60 | 0.21 | 0.33 |
Less distributions | ||||||
From net investment income | (0.15) | (0.32) | (0.35) | (0.38) | (0.39) | (0.12) |
From net realized gain | — | — | (0.08) | (0.01) | — | — |
Total distributions | (0.15) | (0.32) | (0.43) | (0.39) | (0.39) | (0.12) |
Net asset value, end of period | $11.01 | $11.07 | $10.66 | $10.94 | $10.73 | $10.91 |
Total return (%)4 | 0.815 | 6.90 | 1.37 | 5.72 | 1.91 | 3.095 |
Ratios and supplemental data | ||||||
Net assets, end of period (in millions) | $15 | $13 | $15 | $10 | $10 | $5 |
Ratios (as a percentage of average net assets): | ||||||
Expenses before reductions | 0.686 | 0.70 | 0.70 | 0.71 | 0.70 | 0.676 |
Expenses including reductions | 0.676 | 0.69 | 0.69 | 0.70 | 0.69 | 0.666 |
Net investment income | 2.686 | 2.90 | 3.25 | 3.58 | 3.53 | 3.766 |
Portfolio turnover (%) | 5 | 23 | 22 | 22 | 9 | 177 |
1 | Six months ended 11-30-21. Unaudited. |
2 | The inception date for Class I shares is 2-13-17. |
3 | Based on average daily shares outstanding. |
4 | Total returns would have been lower had certain expenses not been reduced during the applicable periods. |
5 | Not annualized. |
6 | Annualized. |
7 | Portfolio turnover is shown for the period from 6-1-16 to 5-31-17. |
SEE NOTES TO FINANCIAL STATEMENTS | SEMIANNUAL REPORT | JOHN HANCOCK California Tax-Free Income Fund | 23 |
CLASS R6 SHARES Period ended | 11-30-211 | 5-31-21 | 5-31-20 | 5-31-19 | 5-31-182 |
Per share operating performance | |||||
Net asset value, beginning of period | $11.07 | $10.66 | $10.94 | $10.73 | $10.95 |
Net investment income3 | 0.15 | 0.32 | 0.36 | 0.38 | 0.29 |
Net realized and unrealized gain (loss) on investments | (0.05) | 0.41 | (0.20) | 0.22 | (0.22) |
Total from investment operations | 0.10 | 0.73 | 0.16 | 0.60 | 0.07 |
Less distributions | |||||
From net investment income | (0.15) | (0.32) | (0.36) | (0.38) | (0.29) |
From net realized gain | — | — | (0.08) | (0.01) | — |
Total distributions | (0.15) | (0.32) | (0.44) | (0.39) | (0.29) |
Net asset value, end of period | $11.02 | $11.07 | $10.66 | $10.94 | $10.73 |
Total return (%)4 | 0.925 | 6.93 | 1.40 | 5.76 | 0.665 |
Ratios and supplemental data | |||||
Net assets, end of period (in millions) | $10 | $9 | $7 | $4 | $2 |
Ratios (as a percentage of average net assets): | |||||
Expenses before reductions | 0.656 | 0.66 | 0.67 | 0.68 | 0.686 |
Expenses including reductions | 0.646 | 0.65 | 0.66 | 0.67 | 0.676 |
Net investment income | 2.706 | 2.93 | 3.28 | 3.58 | 3.566 |
Portfolio turnover (%) | 5 | 23 | 22 | 22 | 97 |
1 | Six months ended 11-30-21. Unaudited. |
2 | The inception date for Class R6 shares is 8-30-17. |
3 | Based on average daily shares outstanding. |
4 | Total returns would have been lower had certain expenses not been reduced during the applicable periods. |
5 | Not annualized. |
6 | Annualized. |
7 | Portfolio turnover is shown for the period from 6-1-17 to 5-31-18. |
24 | JOHN HANCOCK California Tax-Free Income Fund | SEMIANNUAL REPORT | SEE NOTES TO FINANCIAL STATEMENTS |
SEMIANNUAL REPORT | JOHN HANCOCK California Tax-Free Income Fund | 25 |
Total value at 11-30-21 | Level 1 quoted price | Level 2 significant observable inputs | Level 3 significant unobservable inputs | |
Investments in securities: | ||||
Assets | ||||
Municipal bonds | $213,586,209 | — | $213,586,209 | — |
Short-term investments | 5,222,000 | — | 5,222,000 | — |
Total investments in securities | $218,808,209 | — | $218,808,209 | — |
Derivatives: | ||||
Liabilities | ||||
Futures | $(222,874) | $(222,874) | — | — |
26 | JOHN HANCOCK California Tax-Free Income Fund | SEMIANNUAL REPORT |
SEMIANNUAL REPORT | JOHN HANCOCK California Tax-Free Income Fund | 27 |
28 | JOHN HANCOCK California Tax-Free Income Fund | SEMIANNUAL REPORT |
Risk | Statement of assets and liabilities location | Financial instruments location | Assets derivatives fair value | Liabilities derivatives fair value |
Interest rate | Receivable/payable for futures variation margin1 | Futures | — | $(222,874) |
1 | Reflects cumulative appreciation/depreciation on open futures as disclosed in the Derivatives section of Fund’s investments. Only the period end variation margin receivable/payable is separately reported on the Statement of assets and liabilities. |
Statement of operations location - Net realized gain (loss) on: | |
Risk | Futures contracts |
Interest rate | $157,553 |
Statement of operations location - Change in net unrealized appreciation (depreciation) of: | |
Risk | Futures contracts |
Interest rate | $(222,874) |
SEMIANNUAL REPORT | JOHN HANCOCK California Tax-Free Income Fund | 29 |
Class | Expense reduction |
Class A | $8,485 |
Class C | 477 |
Class I | 646 |
Class | Expense reduction |
Class R6 | $437 |
Total | $10,045 |
Class | Rule 12b-1 Fee |
Class A | 0.15% |
Class C | 1.00% |
30 | JOHN HANCOCK California Tax-Free Income Fund | SEMIANNUAL REPORT |
Class | Distribution and service fees | Transfer agent fees |
Class A | $138,125 | $38,404 |
Class C | 51,784 | 2,161 |
Class I | — | 2,921 |
Class R6 | — | 417 |
Total | $189,909 | $43,903 |
Six Months Ended 11-30-21 | Year Ended 5-31-21 | |||
Shares | Amount | Shares | Amount | |
Class A shares | ||||
Sold | 782,139 | $8,672,539 | 1,830,259 | $19,980,106 |
Distributions reinvested | 186,564 | 2,059,712 | 393,976 | 4,306,089 |
Repurchased | (904,649) | (9,987,898) | (2,098,338) | (22,942,740) |
Net increase | 64,054 | $744,353 | 125,897 | $1,343,455 |
Class B shares | ||||
Distributions reinvested | — | — | 181 | $1,965 |
Repurchased | — | — | (26,912) | (291,004) |
Net decrease | — | — | (26,731) | $(289,039) |
SEMIANNUAL REPORT | JOHN HANCOCK California Tax-Free Income Fund | 31 |
Six Months Ended 11-30-21 | Year Ended 5-31-21 | |||
Shares | Amount | Shares | Amount | |
Class C shares | ||||
Sold | 24,318 | $269,171 | 133,082 | $1,452,931 |
Distributions reinvested | 7,494 | 82,767 | 21,870 | 238,812 |
Repurchased | (158,802) | (1,760,367) | (598,929) | (6,550,273) |
Net decrease | (126,990) | $(1,408,429) | (443,977) | $(4,858,530) |
Class I shares | ||||
Sold | 187,306 | $2,070,282 | 478,134 | $5,204,978 |
Distributions reinvested | 16,774 | 185,257 | 33,098 | 361,941 |
Repurchased | (59,128) | (651,724) | (737,882) | (8,015,807) |
Net increase (decrease) | 144,952 | $1,603,815 | (226,650) | $(2,448,888) |
Class R6 shares | ||||
Sold | 240,348 | $2,660,648 | 690,855 | $7,535,736 |
Distributions reinvested | 11,745 | 129,767 | 20,677 | 226,204 |
Repurchased | (100,167) | (1,109,850) | (566,779) | (6,168,922) |
Net increase | 151,926 | $1,680,565 | 144,753 | $1,593,018 |
Total net increase (decrease) | 233,942 | $2,620,304 | (426,708) | $(4,659,984) |
Redesignation | Effective date | Amount | |||||
Class B shares as Class A shares | October 14, 2020 | $267,162 |
32 | JOHN HANCOCK California Tax-Free Income Fund | SEMIANNUAL REPORT |
SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 33 |
(a) | the skills and competency with which the Advisor has in the past managed the Trust’s affairs and its subadvisory relationship, the Advisor’s oversight and monitoring of the Subadvisor’s investment performance and compliance programs, such as the Subadvisor’s compliance with fund policies and objectives, review of brokerage matters, including with respect to trade allocation and best execution and the Advisor’s timeliness in responding to performance issues; |
(b) | the background, qualifications and skills of the Advisor’s personnel; |
34 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT |
(c) | the Advisor’s compliance policies and procedures and its responsiveness to regulatory changes and fund industry developments; |
(d) | the Advisor’s administrative capabilities, including its ability to supervise the other service providers for the fund, as well as the Advisor’s oversight of any securities lending activity, its monitoring of class action litigation and collection of class action settlements on behalf of the fund, and bringing loss recovery actions on behalf of the fund; |
(e) | the financial condition of the Advisor and whether it has the financial wherewithal to provide a high level and quality of services to the fund; |
(f) | the Advisor’s initiatives intended to improve various aspects of the Trust’s operations and investor experience with the fund; and |
(g) | the Advisor’s reputation and experience in serving as an investment advisor to the Trust and the benefit to shareholders of investing in funds that are part of a family of funds offering a variety of investments. |
(a) | reviewed information prepared by management regarding the fund’s performance; |
(b) | considered the comparative performance of an applicable benchmark index; |
(c) | considered the performance of comparable funds, if any, as included in the report prepared by an independent third-party provider of fund data; and |
(d) | took into account the Advisor’s analysis of the fund’s performance and its plans and recommendations regarding the Trust’s subadvisory arrangements generally. |
SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 35 |
(a) | reviewed financial information of the Advisor; |
(b) | reviewed and considered information presented by the Advisor regarding the net profitability to the Advisor and its affiliates with respect to the fund; |
(c) | received and reviewed profitability information with respect to the John Hancock Fund Complex as a whole and with respect to the fund; |
(d) | received information with respect to the Advisor’s allocation methodologies used in preparing the profitability data and considered that the Advisor hired an independent third-party consultant to provide an analysis of the Advisor’s allocation methodologies; |
(e) | considered that the John Hancock insurance companies that are affiliates of the Advisor, as shareholders of the Trust directly or through their separate accounts, receive certain tax credits or deductions relating to foreign taxes paid and dividends received by certain funds of the Trust and noted that these tax benefits, which are not available to participants in qualified retirement plans under applicable income tax law, are reflected in the profitability information reviewed by the Board; |
(f) | considered that the Advisor also provides administrative services to the fund on a cost basis pursuant to an administrative services agreement; |
(g) | noted that affiliates of the Advisor provide transfer agency services and distribution services to the fund, and that the fund’s distributor also receives Rule 12b-1 payments to support distribution of the fund; |
(h) | noted that the fund’s Subadvisor is an affiliate of the Advisor; |
(i) | noted that the Advisor also derives reputational and other indirect benefits from providing advisory services to the fund; |
(j) | noted that the subadvisory fee for the fund is paid by the Advisor; |
36 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT |
(k) | considered the Advisor’s ongoing costs and expenditures necessary to improve services, meet new regulatory and compliance requirements, and adapt to other challenges impacting the fund industry; and |
(l) | considered that the Advisor should be entitled to earn a reasonable level of profits in exchange for the level of services it provides to the fund and the risks that it assumes as Advisor, including entrepreneurial, operational, reputational, litigation and regulatory risk. |
(a) | considered that the Advisor has contractually agreed to waive a portion of its management fee for certain funds of the John Hancock Fund Complex, including the fund (the participating portfolios) or otherwise reimburse the expenses of the participating portfolios (the reimbursement). This waiver is based upon aggregate net assets of all the participating portfolios. The amount of the reimbursement is calculated daily and allocated among all the participating portfolios in proportion to the daily net assets of each fund; |
(b) | reviewed the fund’s advisory fee structure and concluded that: (i) the fund’s fee structure contains breakpoints at the subadvisory fee level and that such breakpoints are reflected as breakpoints in the advisory fees for the fund; and (ii) although economies of scale cannot be measured with precision, these arrangements permit shareholders of the fund to benefit from economies of scale if the fund grows. The Board also took into account management’s discussion of the fund’s advisory fee structure; and |
(c) | the Board also considered the effect of the fund’s growth in size on its performance and fees. The Board also noted that if the fund’s assets increase over time, the fund may realize other economies of scale. |
(1) | information relating to the Subadvisor’s business, including current subadvisory services to the Trust (and other funds in the John Hancock Fund Complex); |
(2) | the historical and current performance of the fund and comparative performance information relating to an applicable benchmark index and comparable funds; and |
(3) | the subadvisory fee for the fund, including any breakpoints, and to the extent available, comparable fee information prepared by an independent third-party provider of fund data. |
SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 37 |
(1) | the Subadvisor has extensive experience and demonstrated skills as a manager; |
(2) | the performance of the fund is being monitored and reasonably addressed, where appropriate |
(3) | the subadvisory fee is reasonable in relation to the level and quality of services being provided under the Subadvisory Agreement; and |
(4) | noted that the subadvisory fees are paid by the Advisor not the fund and that the subadvisory fee breakpoints are reflected as breakpoints in the advisory fees for the fund in order to permit shareholders to benefit from economies of scale if the fund grows. |
38 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT |
SEMIANNUAL REPORT | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | 39 |
Steven R. Pruchansky, Vice Chairperson
Andrew G. Arnott†
Charles L. Bardelis*,1
James R. Boyle
Peter S. Burgess*
William H. Cunningham
Grace K. Fey
Marianne Harrison†
Deborah C. Jackson
Frances G. Rathke*
Gregory A. Russo
President
Chief Financial Officer
Treasurer
Secretary and Chief Legal Officer
Chief Compliance Officer
Adam A. Weigold, CFA
You can also contact us: | ||
800-225-5291 | Regular mail: | Express mail: |
jhinvestments.com | John Hancock Signature Services, Inc. P.O. Box 219909 Kansas City, MO 64121-9909 | John Hancock Signature Services, Inc. 430 W 7th Street Suite 219909 Kansas City, MO 64105-1407 |
40 | JOHN HANCOCK CALIFORNIA TAX-FREE INCOME FUND | SEMIANNUAL REPORT |
GOVERNANCE FUNDS
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and operate with the highest standards of conduct and integrity.
We search the world to find proven portfolio teams with specialized
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ITEM 2. CODE OF ETHICS.
(a)Not Applicable
(b)Not Applicable
(c)Not Applicable
(d)Not Applicable
(e)Not Applicable
(f)Not Applicable
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not Applicable
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
(a)Not Applicable
(b)Not Applicable
(c)Not Applicable
(d)Not Applicable
(e)Not Applicable
(f)Not Applicable
(g)Not Applicable
(h)Not Applicable
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS
Not Applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
(a)Not Applicable.
(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.
(a)The registrant has adopted procedures by which shareholders may recommend nominees to the registrant's Board of Trustees. A copy of the procedures is filed as an exhibit to this Form N- CSR. See attached "John Hancock Funds – Nominating and Governance Committee Charter".
ITEM 11. CONTROLS AND PROCEDURES.
(a)Based upon their evaluation of the registrant's disclosure controls and procedures as conducted within 90 days of the filing date of this Form N-CSR, the registrant's principal executive
officer and principal financial officer have concluded that those disclosure controls and procedures provide reasonable assurance that the material information required to be disclosed by the registrant on this report is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.
(b)There were no changes in the registrant's internal control over financial reporting that occurred during 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. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 13. EXHIBITS.
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.
John Hancock California Tax-Free Income Fund
By: | /s/ Andrew Arnott |
| Andrew Arnott |
| President |
Date: | January 7, 2022 |
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/ Andrew Arnott |
| Andrew Arnott |
| President |
Date: | January 7, 2022 |
By: | /s/ Charles A. Rizzo |
| Charles A. Rizzo |
| Chief Financial Officer |
Date: | January 7, 2022 |