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: 811-06208 Morgan Stanley Multi-States Municipal Series Trust (Exact name of registrant as specified in charter) 1221 Avenue of the Americas, New York, New York 10020 (Address of principal executive offices) (Zip code) Ronald E. Robison 1221 Avenue of the Americas, New York, New York 10020 (Name and address of agent for service) Registrant's telephone number, including area code: 212-762-4000 Date of fiscal year end: November 30, 2003 Date of reporting period: November 30, 2003 Item 1 - Report to Shareholders
Welcome, Shareholder:
In this report, you'll learn about how your investment in Morgan Stanley Multi-State Municipal Series Trust performed during the annual period. We will provide an overview of the market conditions, and discuss some of the factors that affected performance during the reporting period. In addition, this report includes the Fund's financial statements and a list of Fund investments.
![]() | This material must be preceded or accompanied by a prospectus for the fund being offered. Market forecasts provided in this report may not necessarily come to pass. There is no assurance that the Fund will achieve its investment objective. The Fund is subject to market risk, which is the possibility that market values of securities owned by the Fund will decline and, therefore, the value of the Fund's shares may be less than what you paid for them. Accordingly, you can lose money investing in this Fund. |
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![]() | Fund Report |
![]() | For the year ended November 30, 2003 |
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Total Return for the 12 months ended November 30, 2003
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Arizona Series | ![]() | ![]() | ![]() | Lehman Municipal Index1 | ![]() | ![]() | ![]() | Lipper Arizona Municipal Debt Funds Index2 | ||||||
7.23% | ![]() | ![]() | ![]() | 6.65 | % | ![]() | ![]() | ![]() | 6.06 | % | ||||
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Florida Series | ![]() | ![]() | ![]() | Lehman Municipal Index1 | ![]() | ![]() | ![]() | Lipper Florida Municipal Debt Funds Index2 | ||||||
6.84% | ![]() | ![]() | ![]() | 6.65 | % | ![]() | ![]() | ![]() | 5.96 | % | ||||
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New Jersey Series | ![]() | ![]() | ![]() | Lehman Municipal Index1 | ![]() | ![]() | ![]() | Lipper New Jersey Municipal Debt Funds Index2 | ||||||
6.10% | ![]() | ![]() | ![]() | 6.65 | % | ![]() | ![]() | ![]() | 6.40 | % | ||||
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Pennsylvania Series | ![]() | ![]() | ![]() | Lehman Municipal Index1 | ![]() | ![]() | ![]() | Lipper Pennsylvania Municipal Debt Funds Index2 | ||||||
7.27% | ![]() | ![]() | ![]() | 6.65 | % | ![]() | ![]() | ![]() | 6.39 | % | ||||
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The Fund's total return figures assume the reinvestment of all distributions, but do not reflect the deduction of any applicable sales charges. Such costs would lower performance. Past performance is no guarantee of future results. See Performance Summary for standardized performance information. |
Market Overview
Over the past 12 months, the U.S. economy shifted from weak to accelerating growth, culminating in 8.2 percent GDP growth in the third quarter of 2003. One of the most closely watched economic indicators, employment strength, was in negative territory for much of the period but began to improve during the fall. Repeated comments from government and private sector economists suggested that the U.S. economy might experience deflation. The Federal Reserve Board attempted to allay this concern and keep the economy moving forward by cutting the Fed Funds rate twice to a level of 1.0 percent.
The changing economic climate had an effect on the municipal bond market, while yields on intermediate- and long-term bonds ended the period roughly where they began. The 12-month period can be divided into two distinct market environments. The first, which lasted from October 2002 to mid-June 2003, saw municipal yields fall by some 75 basis points to levels not seen since the late 1960s. Plummeting yields led to a surge in issuance as municipalities moved to lock in low financing rates and, in the case of older bonds, take advantage of low refinancing costs. Record levels of supply met with strong demand by investors in search of tax-exempt income to offset low money market rates. Also, the relatively attractive yields of municipal bonds versus Treasuries created demand from institutional taxable investors who "crossed-over" to purchase municipals. At the same time, ongoing budgetary and fiscal difficulties at the state and local levels contributed to ratings downgrades for many municipal issues.
The municipal market reversed abruptly in mid-June. Yields began to climb from their lows as investors shifted their attention to the improving equity market. At the same time, participation from cross-over investors evaporated as taxable yields rose faster than those of
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tax-exempts. Issuance remained strong through July, but slowed over the last four months as yields rose. Overall, these forces combined to push municipal-bond yields above their historic lows to levels near where they began.
Performance Analysis
Morgan Stanley Multi-State Municipal Series Trust is comprised of four state portfolios: Arizona, Florida, New Jersey and Pennsylvania. The positive performance of each portfolio was aided by our investment strategy. With interest rates at or near multi-decade lows we have become increasingly cautious. As a result, we established a hedge position in each portfolio by selling Treasury futures, reducing duration (a measure of interest rate sensitivity) versus its respective benchmark index. This hedge initially caused performance to lag as interest rates fell through June. However, it ultimately benefited total return as it protected the portfolio from the adverse effects of rising interest rates from June through the end of the period. The portfolios' defensive characteristics also included high credit quality and a mix of issues weighted toward premium coupon bonds priced to their respective call (optional redemption) dates. Information on each of the Series in the Fund is summarized below.
Arizona
During the fiscal year the Arizona Series' net asset value increased from $10.44 per share to $10.65 per share. Based on this change, plus a reinvestment of tax-free dividends totaling $0.41 per share and a long-term capital gain of $0.11 per share, the Series' total return was 7.23 percent. The Series' duration as of November 30, 2003 was 7.3 years. The portfolio's average maturity and call protection were 16 and 8 years, respectively. Nearly 85 percent of the portfolio was rated AA or AAA. The Arizona Series' net assets of $29 million were diversified among 10 long-term sectors and 25 credits.
Florida
During the fiscal year the Florida Series' net asset value increased from $10.65 per share to $10.71 per share. Based on this change, plus a reinvestment of tax-free dividends totaling $0.46 per share and a long-term capital gain of $0.19 per share, the Series' total return was 6.84 percent. The Series' duration as of November 30, 2003 was 7.6 years. The portfolio's average maturity and call protection were 18 and 7 years, respectively. Nearly 95 percent of the portfolio was rated AA or AAA. The Florida Series' net assets of $38 million were diversified among 9 long-term sectors and 30 credits.
New Jersey
During the fiscal year the New Jersey Series' net asset value increased from $10.75 per share to $10.83 per share. Based on this change, plus a reinvestment of tax-free dividends totaling $0.47 per share and a long-term capital gain of $0.10 per share, the Series' total return was 6.10 percent. The Series' duration as of November 30, 2003 was 7.2 years. The portfolio's average maturity and call protection were 18 and 6 years, respectively. More than 90 percent of the portfolio was rated AA or AAA.
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The New Jersey Series' net assets of $34 million were diversified among 13 long-term sectors and 29 credits.
Pennsylvania
During the fiscal year the Pennsylvania Series' net asset value increased from $10.76 per share to $10.97 per share. Based on this change, plus a reinvestment of tax-free dividends totaling $0.47 per share and a long-term capital gain of $0.08 per share, the Series' total return was 7.27 percent. The Series' duration as of November 30, 2003 was 7.4 years. The portfolio's average maturity and call protection were 19 and 8 years, respectively. Nearly 75 percent of the portfolio was rated AA or AAA. The Pennsylvania Series' net assets of $34 million were diversified among 12 long-term sectors and 28 credits.
Arizona
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LARGEST SECTORS | ![]() | |||||
Public Facilities | ![]() | 19.2 | % | |||
Transportation | ![]() | 14.9 | ||||
Water & Sewer | ![]() | 11.5 | ||||
Electric | ![]() | 11.3 | ||||
Education | ![]() | 11.3 | ||||
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Florida
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LARGEST SECTORS | ![]() | |||||
Public Facilities | ![]() | 24.7 | % | |||
Transportation | ![]() | 18.3 | ||||
Water & Sewer | ![]() | 17.1 | ||||
Electric | ![]() | 11.8 | ||||
Hospital | ![]() | 11.3 | ||||
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Investment Strategy for Arizona Series
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• | The Arizona Series invests at least 80 percent of its assets in securities that pay interest normally exempt from federal and Arizona state income taxes. This policy is fundamental and may not be changed without shareholder approval. The Arizona Series' Investment Manager, Morgan Stanley Investment Advisors Inc., generally invests in investment grade, Arizona municipal obligations and obligations of U.S. Governmental territories such as Puerto Rico. The municipal obligations may only be rated investment grade by Moody's Investors Service or Standard & Poor's Corporation or Fitch Investors Services, LP or, if unrated, judged to be of comparable quality by the Investment Manager at the time of purchase. There are no maturity limitations on the Arizona Series' portfolio securities. Income earned by certain securities in the portfolio may be subject to the federal alternative minimum tax (AMT). |
Investment Strategy for Florida Series
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• | The Florida Series invests at least 80 percent of its assets in securities that pay interest normally exempt from federal and the Florida state intangibles tax. (Florida presently does not impose an income tax on individuals.) This policy is fundamental and may not be changed without shareholder approval. The Florida Series' Investment Manager, Morgan Stanley Investment Advisors Inc., generally invests in investment grade, Florida municipal obligations and obligations of U.S. Governmental territories such as Puerto Rico. The municipal obligations may only be rated investment grade by Moody's Investors Service or Standard & Poor's Corporation or Fitch Investors Services, LP or, if unrated, judged to be of comparable quality by the Investment Manager at the time of purchase. There are no maturity limitations on the Florida Series' portfolio securities. Income earned by certain securities in the portfolio may be subject to the federal alternative minimum tax (AMT). |
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New Jersey
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LARGEST SECTORS | ![]() | |||||
Water & Sewer | ![]() | 16.9 | % | |||
Public Facilities | ![]() | 15.4 | ||||
Transportation | ![]() | 13.9 | ||||
Mortgage | ![]() | 11.3 | ||||
Hospital | ![]() | 11.2 | ||||
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Pennsylvania
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LARGEST SECTORS | ![]() | |||||
Education | ![]() | 18.7 | % | |||
General Obligation | ![]() | 17.7 | ||||
Hospital | ![]() | 11.0 | ||||
Water & Sewer | ![]() | 10.9 | ||||
IDR/PCR* | ![]() | 6.1 | ||||
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![]() | * | Industrial Development/Pollution Control Revenue |
Subject to change daily. Largest sectors is shown as a percentage of net assets. Morgan Stanley is a full-service firm engaged in securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services. |
Investment Strategy for New Jersey Series
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• | The New Jersey Series invests at least 80 percent of its assets in securities that pay interest normally exempt from federal and New Jersey state income taxes. This policy is fundamental and may not be changed without shareholder approval. The New Jersey Series' Investment Manager, Morgan Stanley Investment Advisors Inc., generally invests in investment grade, New Jersey municipal obligations and obligations of U.S. Governmental territories such as Puerto Rico. The municipal obligations may only be rated investment grade by Moody's Investors Service or Standard & Poor's Corporation or Fitch Investors Services, LP or, if unrated, judged to be of comparable quality by the Investment Manager at the time of purchase. There are no maturity limitations on the New Jersey Series' portfolio securities. Income earned by certain securities in the portfolio may be subject to the federal alternative minimum tax (AMT). |
Investment Strategy for Pennsylvania Series
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• | The Pennsylvania Series invests at least 80 percent of its assets in securities that pay interest normally exempt from federal and Pennsylvania state income taxes. This policy is fundamental and may not be changed without shareholder approval. The Pennsylvania Series' Investment Manager, Morgan Stanley Investment Advisors Inc., generally invests in investment grade, Pennsylvania municipal obligations and obligations of U.S. Governmental territories such as Puerto Rico. The municipal obligations may only be rated investment grade by Moody's Investors Service or Standard & Poor's Corporation or Fitch Investors Services, LP or, if unrated, judged to be of comparable quality by the Investment Manager at the time of purchase. There are no maturity limitations on the Pennsylvania Series' portfolio securities. Income earned by certain securities in the portfolio may be subject to the federal alternative minimum tax (AMT). |
Annual Householding Notice
To reduce printing and mailing costs, the Fund attempts to eliminate duplicate mailings to the same address. The Fund delivers a single copy of certain shareholder documents including shareholder reports, prospectuses and proxy materials to investors with the same last name and who reside at the same address. Your participation in this program will continue for an unlimited period of time, unless you instruct us otherwise. You can request multiple copies of these documents by calling (800) 350-6414, 8:00 am to 8:00 pm, ET. Once our Customer Service Center has received your instructions, we will begin sending individual copies for each account within 30 days.
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![]() | Performance Summary |
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Performance of a $10,000 Investment — Arizona Series
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![]() | Past performance is not predictive of future returns. Investment return and principal value will fluctuate. When you sell fund shares, they may be worth less than their original cost. The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
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Average Annual Total Returns — Period Ended November 30, 2003
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![]() | ![]() | ![]() | (since 04/30/91) | |||||
Symbol | ![]() | ![]() | ![]() | DWAZX | ||||
1 Year | ![]() | ![]() | ![]() | 7.23% | 3 | |||
![]() | ![]() | ![]() | 2.94 | 4 | ||||
5 Years | ![]() | ![]() | ![]() | 4.85 | 3 | |||
![]() | ![]() | ![]() | 3.99 | 4 | ||||
10 Years | ![]() | ![]() | ![]() | 5.15 | 3 | |||
![]() | ![]() | ![]() | 4.72 | 4 | ||||
Since Inception | ![]() | ![]() | ![]() | 6.31 | 3 | |||
![]() | ![]() | ![]() | 5.97 | 4 | ||||
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Notes on Performance
![]() | (1) | The Lehman Brothers Municipal Bond Index tracks the performance of municipal bonds rated at least Baa or BBB by Moody's Investors Service, Inc. or Standard & Poor's Corporation, respectively, and with maturities of 2 years or greater. Indexes are unmanaged and their returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index. |
![]() | (2) | The Lipper Arizona Municipal Debt Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper Arizona Municipal Debt Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 10 funds represented in this Index. |
![]() | (3) | Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges. |
![]() | (4) | Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund's current prospectus for complete details on fees and sales charges. |
![]() | ‡ | Closing value including the deduction of a 4% front-end sales charge, assuming a complete redemption on November 30, 2003. |
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Performance of a $10,000 Investment — Florida Series
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/html_62211floridalinechart.jpg)
![]() | Past performance is not predictive of future returns. Investment return and principal value will fluctuate. When you sell fund shares, they may be worth less than their original cost. The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
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Average Annual Total Returns — Period Ended November 30, 2003
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Symbol | ![]() | ![]() | ![]() | DWFLX | ||||
1 Year | ![]() | ![]() | ![]() | 6.84% | 3 | |||
![]() | ![]() | ![]() | 2.56 | 4 | ||||
5 Years | ![]() | ![]() | ![]() | 4.83 | 3 | |||
![]() | ![]() | ![]() | 3.98 | 4 | ||||
10 Years | ![]() | ![]() | ![]() | 5.34 | 3 | |||
![]() | ![]() | ![]() | 4.91 | 4 | ||||
Since Inception | ![]() | ![]() | ![]() | 6.60 | 3 | |||
![]() | ![]() | ![]() | 6.27 | 4 | ||||
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Notes on Performance
![]() | (1) | The Lehman Brothers Municipal Bond Index tracks the performance of municipal bonds rated at least Baa or BBB by Moody's Investors Service, Inc. or Standard & Poor's Corporation, respectively, and with maturities of 2 years or greater. Indexes are unmanaged and their returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index. |
![]() | (2) | The Lipper Florida Municipal Debt Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper Florida Municipal Debt Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 10 funds represented in this Index. |
![]() | (3) | Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges. |
![]() | (4) | Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund's current prospectus for complete details on fees and sales charges. |
![]() | ‡ | Closing value including the deduction of a 4% front-end sales charge, assuming a complete redemption on November 30, 2003. |
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Performance of a $10,000 Investment — New Jersey Series
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![]() | Past performance is not predictive of future returns. Investment return and principal value will fluctuate. When you sell fund shares, they may be worth less than their original cost. The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
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Average Annual Total Returns — Period Ended November 30, 2003
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Symbol | ![]() | ![]() | ![]() | DWNJX | ||||
1 Year | ![]() | ![]() | ![]() | 6.10% | 3 | |||
![]() | ![]() | ![]() | 1.86 | 4 | ||||
5 Years | ![]() | ![]() | ![]() | 4.63 | 3 | |||
![]() | ![]() | ![]() | 3.78 | 4 | ||||
10 Years | ![]() | ![]() | ![]() | 5.23 | 3 | |||
![]() | ![]() | ![]() | 4.80 | 4 | ||||
Since Inception | ![]() | ![]() | ![]() | 6.60 | 3 | |||
![]() | ![]() | ![]() | 6.26 | 4 | ||||
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Notes on Performance
![]() | (1) | The Lehman Brothers Municipal Bond Index tracks the performance of municipal bonds rated at least Baa or BBB by Moody's Investors Service, Inc. or Standard & Poor's Corporation, respectively, and with maturities of 2 years or greater. Indexes are unmanaged and their returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index. |
![]() | (2) | The Lipper New Jersey Municipal Debt Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper New Jersey Municipal Debt Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 10 funds represented in this Index. |
![]() | (3) | Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges. |
![]() | (4) | Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund's current prospectus for complete details on fees and sales charges. |
![]() | ‡ | Closing value including the deduction of a 4% front-end sales charge, assuming a complete redemption on November 30, 2003. |
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Performance of a $10,000 Investment — Pennsylvania Series
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/html_62211pennlinechart.jpg)
![]() | Past performance is not predictive of future returns. Investment return and principal value will fluctuate. When you sell fund shares, they may be worth less than their original cost. The graph and table do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. |
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Average Annual Total Returns — Period Ended November 30, 2003
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![]() | ![]() | ![]() | (since 01/15/91) | |||||
Symbol | ![]() | ![]() | ![]() | DWPAX | ||||
1 Year | ![]() | ![]() | ![]() | 7.27% | 3 | |||
![]() | ![]() | ![]() | 2.98 | 4 | ||||
5 Years | ![]() | ![]() | ![]() | 4.97 | 3 | |||
![]() | ![]() | ![]() | 4.12 | 4 | ||||
10 Years | ![]() | ![]() | ![]() | 5.33 | 3 | |||
![]() | ![]() | ![]() | 4.90 | 4 | ||||
Since Inception | ![]() | ![]() | ![]() | 6.66 | 3 | |||
![]() | ![]() | ![]() | 6.33 | 4 | ||||
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Notes on Performance
![]() | (1) | The Lehman Brothers Municipal Bond Index tracks the performance of municipal bonds rated at least Baa or BBB by Moody's Investors Service, Inc. or Standard & Poor's Corporation, respectively, and with maturities of 2 years or greater. Indexes are unmanaged and their returns do not include any sales charges or fees. Such costs would lower performance. It is not possible to invest directly in an index. |
![]() | (2) | The Lipper Pennsylvania Municipal Debt Funds Index is an equally weighted performance index of the largest qualifying funds (based on net assets) in the Lipper Pennsylvania Municipal Debt Funds classification. The Index, which is adjusted for capital gains distributions and income dividends, is unmanaged and should not be considered an investment. There are currently 10 funds represented in this Index. |
![]() | (3) | Figure shown assumes reinvestment of all distributions and does not reflect the deduction of any sales charges. |
![]() | (4) | Figure shown assumes reinvestment of all distributions and the deduction of the maximum applicable sales charge. See the Fund's current prospectus for complete details on fees and sales charges. |
![]() | ‡ | Closing value including the deduction of a 4% front-end sales charge, assuming a complete redemption on November 30, 2003. |
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Morgan Stanley Multi-State Municipal Series Trust
Portfolio Summary November 30, 2003
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![]() | ARIZONA SERIES | ![]() | FLORIDA SERIES | ![]() | NEW JERSEY SERIES | ![]() | PENNSYLVANIA SERIES | |||||||||||
Credit Ratings(2): | ||||||||||||||||||
Aaa or AAA | ![]() | 73 | % | ![]() | 83 | % | ![]() | 83 | % | ![]() | 60 | % | ||||||
Aa or AA | ![]() | 12 | ![]() | 11 | ![]() | 8 | ![]() | 15 | ||||||||||
A or A | ![]() | 11 | ![]() | 3 | ![]() | 9 | ![]() | 10 | ||||||||||
Baa or BBB | ![]() | 4 | ![]() | 3 | ![]() | — | ![]() | 15 | ||||||||||
Portfolio Distribution by Call Date: | ||||||||||||||||||
2003 | ![]() | — | ![]() | — | ![]() | 3 | % | ![]() | — | |||||||||
2004 | ![]() | 8 | % | ![]() | 10 | % | ![]() | 8 | ![]() | 5 | % | |||||||
2005 | ![]() | — | ![]() | 8 | ![]() | 15 | ![]() | 4 | ||||||||||
2006 | ![]() | — | ![]() | 3 | ![]() | 3 | ![]() | 3 | ||||||||||
2007 | ![]() | — | ![]() | 6 | ![]() | 2 | ![]() | 3 | ||||||||||
2008 | ![]() | — | ![]() | — | ![]() | 10 | ![]() | 3 | ||||||||||
2009 | ![]() | 4 | ![]() | 3 | ![]() | — | ![]() | 5 | ||||||||||
2010 | ![]() | 10 | ![]() | 5 | ![]() | 16 | ![]() | 10 | ||||||||||
2011 | ![]() | 26 | ![]() | 29 | ![]() | 9 | ![]() | 17 | ||||||||||
2012 | ![]() | 24 | ![]() | 12 | ![]() | 10 | ![]() | 14 | ||||||||||
2013+ | ![]() | 28 | ![]() | 24 | ![]() | 24 | ![]() | 36 | ||||||||||
Weighted Average: | ![]() | |||||||||||||||||
Maturity | ![]() | 16 | Years | ![]() | 18 | Years | ![]() | 18 | Years | ![]() | 19 | Years | ||||||
Call Protection | ![]() | 8 | Years | ![]() | 7 | Years | ![]() | 6 | Years | ![]() | 8 | Years | ||||||
Duration(3) | ![]() | 7.3 | Years | ![]() | 7.6 | Years | ![]() | 7.2 | Years | ![]() | 7.4 | Years | ||||||
Per Share Net Asset Value: | ||||||||||||||||||
November 30, 2002 | ![]() | $ | 10.44 | ![]() | $ | 10.65 | ![]() | $ | 10.75 | ![]() | $ | 10.76 | ||||||
November 30, 2003 | ![]() | $ | 10.65 | ![]() | $ | 10.71 | ![]() | $ | 10.83 | ![]() | $ | 10.97 | ||||||
Distributions(4) | ![]() | $ | 0.52 | ![]() | $ | 0.65 | ![]() | $ | 0.57 | ![]() | $ | 0.55 | ||||||
Total Return(5): | ||||||||||||||||||
12 months ended 11/30/03 | ![]() | 7.23 | % | ![]() | 6.84 | % | ![]() | 6.10 | % | ![]() | 7.27 | % | ||||||
![]() |
![]() |
![]() | (1) | Portfolio characteristics, except duration, based on long-term portfolio. |
![]() | (2) | Represents Moody's or Standard & Poor's ratings of the credit quality of the long-term bonds owned by each Series. |
![]() | (3) | Duration includes long and short-term securities, cash, and hedge positions, if any. |
![]() | (4) | Includes all income dividends and capital gains distributions, if any, paid by each Series for the fiscal year ended November 30, 2003. |
![]() | (5) | Total return figures represent the change in each Series' total value per share for the period measured, taking into account the change in NAV plus compounded, reinvested dividends and distributions and do not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period. |
14
Morgan Stanley Multi-State Municipal Series Trust — Arizona Series
Portfolio of Investments November 30, 2003
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | |||||||||||
![]() | Arizona Tax-Exempt Municipal Bonds*(95.0%) | |||||||||||||||||
![]() | General Obligation (10.0%) | |||||||||||||||||
$ | 500 | ![]() | Maricopa County Community College District, Refg Ser 2002 | ![]() | 5.25 | % | ![]() | 07/01/11 | ![]() | $ | 568,945 | |||||||
1,000 | ![]() | Maricopa County School District, Project of 2002 Ser A (FSA) | ![]() | 5.00 | ![]() | 07/01/17 | ![]() | 1,079,390 | ||||||||||
1,000 | ![]() | Puerto Rico, Public Improvement Ser 1998 (MBIA) | ![]() | 6.00 | ![]() | 07/01/16 | ![]() | 1,210,120 | ||||||||||
2,500 | ![]() | ![]() | ![]() | ![]() | 2,858,455 | |||||||||||||
![]() | Educational Facilities Revenue (11.3%) | |||||||||||||||||
![]() | Arizona Board of Regents, | |||||||||||||||||
1,000 | ![]() | Arizona State University Ser 2002 COPs (MBIA) | ![]() | 5.375 | ![]() | 07/01/19 | ![]() | 1,088,860 | ||||||||||
1,000 | ![]() | Northern Arizona University Ser 2002 (FGIC) | ![]() | 5.00 | ![]() | 06/01/30 | ![]() | 1,018,380 | ||||||||||
1,000 | ![]() | University of Arizona Ser 2001 A COPs (Ambac) | ![]() | 5.50 | ![]() | 06/01/18 | ![]() | 1,113,870 | ||||||||||
3,000 | ![]() | ![]() | ![]() | ![]() | 3,221,110 | |||||||||||||
![]() | Electric Revenue (11.3%) | |||||||||||||||||
1,000 | ![]() | Arizona Power Authority, Hoover Uprating Refg Ser 2001 | ![]() | 5.25 | ![]() | 10/01/17 | ![]() | 1,124,440 | ||||||||||
1,000 | ![]() | Salt River Project Agricultural Improvement & Power District, Refg 2002 Ser A | ![]() | 5.25 | ![]() | 01/01/19 | ![]() | 1,085,320 | ||||||||||
1,000 | ![]() | Puerto Rico Electric Power Authority, Ser 2003 NN | ![]() | 5.125 | ![]() | 07/01/29 | ![]() | 1,020,460 | ||||||||||
3,000 | ![]() | ![]() | ![]() | ![]() | 3,230,220 | |||||||||||||
![]() | Hospital Revenue (7.5%) | |||||||||||||||||
1,000 | ![]() | Pima County Industrial Development Authority, Carondelet Health Care Ser 1993 (MBIA) | ![]() | 5.25 | ![]() | 07/01/13 | ![]() | 1,115,180 | ||||||||||
1,000 | ![]() | Scottsdale Industrial Development Authority, Scottsdale Health Care Ser 2001 | ![]() | 5.80 | ![]() | 12/01/31 | ![]() | 1,031,760 | ||||||||||
2,000 | ![]() | ![]() | ![]() | ![]() | 2,146,940 | |||||||||||||
![]() | Industrial Development/Pollution Control Revenue (3.5%) | |||||||||||||||||
1,000 | ![]() | Greenlee County Industrial Development Authority, Phelps Dodge Corp Refg 1994 | ![]() | 5.45 | ![]() | 06/01/09 | ![]() | 1,000,340 | ||||||||||
![]() | Mortgage Revenue – Single Family (1.7%) | |||||||||||||||||
465 | ![]() | Maricopa County Industrial Development Authority, Ser 2000-1C (AMT) | ![]() | 6.25 | ![]() | 12/01/30 | ![]() | 479,931 | ||||||||||
![]() | Public Facilities Revenue (19.2%) | |||||||||||||||||
![]() | Arizona School Facilities Board, | |||||||||||||||||
1,000 | ![]() | School Improvement, Ser 2001 | ![]() | 5.00 | ![]() | 07/01/19 | ![]() | 1,058,040 | ||||||||||
1,000 | ![]() | School Improvement, Ser 2002 | ![]() | 5.25 | ![]() | 07/01/20 | ![]() | 1,080,650 | ||||||||||
1,100 | ![]() | Flagstaff Municipal Facilities Corporation, Ser 2003 (Ambac) | ![]() | 5.25 | ![]() | 07/01/20 | ![]() | 1,189,023 | ||||||||||
![]() |
See Notes to Financial Statements
15
Morgan Stanley Multi-State Municipal Series Trust — Arizona Series
Portfolio of Investments November 30, 2003 continued
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | |||||||||||
$ | 1,000 | ![]() | Phoenix Civic Improvement Corporation, Phoenix Municipal Courthouse Sr Lien Excise Tax Ser 1999 A | ![]() | 5.25 | % | ![]() | 07/01/24 | ![]() | $ | 1,051,520 | |||||||
1,000 | ![]() | Phoenix Industrial Development Authority, Capital Mall LLC Ser 2000 (Ambac) | ![]() | 5.375 | ![]() | 09/15/22 | ![]() | 1,080,880 | ||||||||||
5,100 | ![]() | ![]() | ![]() | ![]() | 5,460,113 | |||||||||||||
![]() | Transportation Facilities Revenue (14.9%) | |||||||||||||||||
1,000 | ![]() | Arizona Transportation Board, Highway Ser 2001 | ![]() | 5.25 | ![]() | 07/01/20 | ![]() | 1,079,820 | ||||||||||
1,000 | ![]() | Phoenix Civic Improvement Corporation, Sr Lien Airport Ser 2002 B (AMT) (FGIC) | ![]() | 5.75 | ![]() | 07/01/19 | ![]() | 1,093,060 | ||||||||||
1,000 | ![]() | Phoenix, Street & Highway Jr Lien Refg Ser 2002 (FGIC) | ![]() | 5.00 | ![]() | 07/01/11 | ![]() | 1,121,150 | ||||||||||
1,000 | ![]() | Puerto Rico Highway & Transportation Authority, Ser 1998 A # | ![]() | 4.75 | ![]() | 07/01/38 | ![]() | 962,990 | ||||||||||
4,000 | ![]() | ![]() | ![]() | ![]() | 4,257,020 | |||||||||||||
![]() | Water & Sewer Revenue (11.5%) | |||||||||||||||||
1,000 | ![]() | Arizona Water Infrastucture Finance Authority, Ser 2001 A | ![]() | 5.375 | ![]() | 10/01/18 | ![]() | 1,106,820 | ||||||||||
1,000 | ![]() | Gilbert, Water & Wastewater Refg Ser 1992 (FGIC) | ![]() | 6.50 | ![]() | 07/01/22 | ![]() | 1,040,090 | ||||||||||
![]() | Tucson, | |||||||||||||||||
500 | ![]() | Water Refg Ser 2002 (FGIC) | ![]() | 5.50 | ![]() | 07/01/17 | ![]() | 563,715 | ||||||||||
500 | ![]() | Water Refg Ser 2002 (FGIC) | ![]() | 5.50 | ![]() | 07/01/18 | ![]() | 560,205 | ||||||||||
3,000 | ![]() | ![]() | ![]() | ![]() | 3,270,830 | |||||||||||||
![]() | Refunded (4.1%) | |||||||||||||||||
1,000 | ![]() | Phoenix, Ser 2000 | ![]() | 5.875 | ![]() | 07/01/10† | ![]() | 1,168,480 | ||||||||||
25,065 | ![]() | Total Arizona Tax-Exempt Municipal Bonds (Cost $25,529,671) | ![]() | 27,093,439 | ||||||||||||||
![]() | Short-Term Arizona Tax-Exempt Municipal Obligations (2.5%) | |||||||||||||||||
400 | ![]() | Pinal County Industrial Development Authority, Newmont Mining Co Ser 1984 (Demand 12/01/03) | ![]() | 1.10 | ** | ![]() | 12/01/09 | ![]() | 400,000 | |||||||||
300 | ![]() | Tempe, Tempe Center for the Arts Ser 2002 (Demand 12/01/03) | ![]() | 1.10 | ** | ![]() | 07/01/20 | ![]() | 300,000 | |||||||||
700 | ![]() | Total Short-Term Arizona Tax-Exempt Municipal Obligations (Cost $700,000) | ![]() | 700,000 | ||||||||||||||
$ | 25,765 | ![]() | Total Investments (Cost $26,229,671) (a) (b) | ![]() | 97.5 | % | ![]() | 27,793,439 | ||||||||||
![]() | Other Assets in Excess of Liabilities | ![]() | 2.5 | ![]() | 715,312 | |||||||||||||
![]() | Net Assets | ![]() | 100.0 | % | ![]() | $ | 28,508,751 | |||||||||||
![]() |
See Notes to Financial Statements
16
Morgan Stanley Multi-State Municipal Series Trust — Arizona Series
Portfolio of Investments November 30, 2003 continued
![]() |
![]() | AMT | Alternative Minimum Tax. |
![]() | COPs | Certificates of Participation. |
![]() | * | Puerto Rico issues represent 11.2% of net assets. |
![]() | ** | Current coupon of variable rate demand obligation. |
![]() | # | This security has been physically segregated in connection with open futures contracts. |
![]() | † | Prerefunded to call date shown. |
![]() | (a) | Securities have been designated as collateral in an amount equal to $5,165,287 in connection with the open futures contracts. |
![]() | (b) | The aggregate cost for federal income tax purposes is $26,229,499. The aggregate gross and net unrealized appreciation is $1,563,940. |
Bond Insurance: |
![]() | Ambac | Ambac Assurance Corporation. |
![]() | FGIC | Financial Guaranty Insurance Company. |
![]() | FSA | Financial Security Assurance Inc. |
![]() | MBIA | Municipal Bond Investors Assurance Corporation. |
Futures Contracts Open at November 30, 2003:
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
NUMBER OF CONTRACTS | ![]() | LONG/SHORT | ![]() | DESCRIPTION, DELIVERY MONTH AND YEAR | ![]() | UNDERLYING FACE AMOUNT AT VALUE | ![]() | UNREALIZED APPRECIATION | ||||||||||
30 | ![]() | Short | ![]() | U.S. Treasury Note 5 Yr March/2004 | ![]() | $(3,311,250) | ![]() | $19,546 | ||||||||||
25 | ![]() | Short | ![]() | U.S. Treasury Note 10 Yr March/2004 | ![]() | (2,772,266) | ![]() | 25,064 | ||||||||||
![]() | ![]() | Total unrealized appreciation | ![]() | $44,610 | ||||||||||||||
![]() |
See Notes to Financial Statements
17
Morgan Stanley Multi-State Municipal Series Trust — Florida Series
Portfolio of Investments November 30, 2003
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | |||||||||||
![]() | Florida Tax-Exempt Municipal Bonds*(95.6%) | |||||||||||||||||
![]() | Educational Facilities Revenue (2.7%) | |||||||||||||||||
$ | 1,000 | ![]() | Volusia County Educational Facilities Authority, Embry-Riddle Aeronautical University Ser 1996 A | ![]() | 6.125 | % | ![]() | 10/15/16 | ![]() | $ | 1,027,870 | |||||||
![]() | Electric Revenue (11.8%) | |||||||||||||||||
1,000 | ![]() | Gainesville, Utilities 2003 Ser A (FSA) | ![]() | 5.00 | ![]() | 10/01/33 | ![]() | 1,021,380 | ||||||||||
1,000 | ![]() | Jacksonville Electric Authority, St Johns Power Park Issue 2 Ser 7 | ![]() | 5.00 | ![]() | 10/01/18 | ![]() | 1,051,220 | ||||||||||
2,000 | ![]() | Lakeland, Refg Ser 1999 A (MBIA) | ![]() | 0.00 | ![]() | 10/01/14 | ![]() | 1,273,780 | ||||||||||
1,000 | ![]() | Orlando Utilities Commission, Water & Electric Ser 2001 | ![]() | 5.25 | ![]() | 10/01/19 | ![]() | 1,081,230 | ||||||||||
5,000 | ![]() | ![]() | ![]() | ![]() | 4,427,610 | |||||||||||||
![]() | Hospital Revenue (11.3%) | |||||||||||||||||
1,000 | ![]() | Alachua County Health Facilities Authority, Shands Teaching Hospital & Clinics Ser 1996 A (MBIA) | ![]() | 6.25 | ![]() | 12/01/11 | ![]() | 1,198,100 | ||||||||||
1,000 | ![]() | Jacksonville, University Medical Center Ser 1992 (Connie Lee) | ![]() | 6.60 | ![]() | 02/01/21 | ![]() | 1,020,200 | ||||||||||
885 | ![]() | Polk County Industrial Development Authority, Winter Haven Hospital 1985 Ser 2 (MBIA) | ![]() | 6.25 | ![]() | 09/01/15 | ![]() | 906,373 | ||||||||||
1,000 | ![]() | Tampa, Catholic Health East Ser 1998 A-1 (MBIA) | ![]() | 5.50 | ![]() | 11/15/14 | ![]() | 1,142,100 | ||||||||||
3,885 | ![]() | ![]() | ![]() | ![]() | 4,266,773 | |||||||||||||
![]() | Public Facilities Revenue (24.7%) | |||||||||||||||||
1,000 | ![]() | Alachua County School Board, Ser 2001 COPs (Ambac) | ![]() | 5.00 | ![]() | 07/01/21 | ![]() | 1,043,590 | ||||||||||
1,000 | ![]() | Hillsborough County School District, Sales Tax Refg (Ambac) | ![]() | 5.375 | ![]() | 10/01/20 | ![]() | 1,095,170 | ||||||||||
1,500 | ![]() | Jacksonville, Sales Tax Ser 2001 (Ambac) | ![]() | 5.50 | ![]() | 10/01/17 | ![]() | 1,685,070 | ||||||||||
1,000 | ![]() | Lake County School Board, Ser 2002 COPs (Ambac) | ![]() | 5.375 | ![]() | 07/01/18 | ![]() | 1,097,960 | ||||||||||
1,000 | ![]() | Osceola County, Sales Surtax Ser 2002 (Ambac) | ![]() | 5.375 | ![]() | 10/01/21 | ![]() | 1,080,990 | ||||||||||
1,000 | ![]() | Osceola County School District, Ser 2001 (FGIC) | ![]() | 5.125 | ![]() | 06/01/25 | ![]() | 1,036,260 | ||||||||||
1,000 | ![]() | Palm Beach County, Criminal Justice Ser 1997 (FGIC) | ![]() | 5.75 | ![]() | 06/01/13 | ![]() | 1,170,150 | ||||||||||
1,000 | ![]() | Tampa, Sales Tax Ser A 2001 (Ambac) | ![]() | 5.375 | ![]() | 10/01/21 | ![]() | 1,081,840 | ||||||||||
8,500 | ![]() | ![]() | ![]() | ![]() | 9,291,030 | |||||||||||||
![]() | Recreational Facilities Revenue (2.7%) | |||||||||||||||||
1,000 | ![]() | Miami Sports & Exhibition Authority, Refg Ser 1992 A (FGIC) | ![]() | 6.15 | ![]() | 10/01/20 | ![]() | 1,013,800 | ||||||||||
![]() | Retirement & Life Care Facilities Revenue (2.7%) | |||||||||||||||||
1,000 | ![]() | Escambia County Health Facilities Authority, Ascension Health Ser 2002 C | ![]() | 5.25 | ![]() | 11/15/32 | ![]() | 1,021,460 | ||||||||||
![]() | Transportation Facilities Revenue (18.3%) | |||||||||||||||||
1,000 | ![]() | Greater Orlando Aviation Authority, Ser 1997 (AMT) (FGIC) | ![]() | 5.75 | ![]() | 10/01/11 | ![]() | 1,134,370 | ||||||||||
1,000 | ![]() | Miami-Dade County Aviation, Miami Int'l Airport Ser 2003 A (AMT) (FGIC) | ![]() | 5.00 | ![]() | 10/01/33 | ![]() | 1,007,280 | ||||||||||
![]() |
See Notes to Financial Statements
18
Morgan Stanley Multi-State Municipal Series Trust — Florida Series
Portfolio of Investments November 30, 2003 continued
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | |||||||||||
$ | 2,000 | ![]() | Mid-Bay Bridge Authority, Refg Ser 1993 A (Ambac) | ![]() | 5.95 | % | ![]() | 10/01/22 | ![]() | $ | 2,245,700 | |||||||
1,500 | ![]() | Osceola County, Osceola Parkway (MBIA) | ![]() | 6.10 | ![]() | 04/01/17 | ![]() | 1,520,880 | ||||||||||
1,000 | ![]() | Puerto Rico Highway & Transportation Authority, Ser 1998 A | ![]() | 4.75 | ![]() | 07/01/38 | ![]() | 962,990 | ||||||||||
6,500 | ![]() | ![]() | ![]() | ![]() | 6,871,220 | |||||||||||||
![]() | Water & Sewer Revenue (17.1%) | |||||||||||||||||
1,000 | ![]() | Broward County, Utility Ser 2003 (MBIA) | ![]() | 5.00 | ![]() | 10/01/24 | ![]() | 1,030,120 | ||||||||||
2,000 | ![]() | Dade County, Water & Sewer Ser 1995 (FGIC) | ![]() | 5.50 | ![]() | 10/01/25 | ![]() | 2,141,340 | ||||||||||
1,000 | ![]() | Florida Governmental Utility Authority, Golden Gate Ser 1999 (Ambac) | ![]() | 5.25 | ![]() | 07/01/18 | ![]() | 1,088,460 | ||||||||||
1,000 | ![]() | Lakeland, Water & Wastewater Refg & Impr Ser 2002 | ![]() | 5.00 | ![]() | 10/01/32 | ![]() | 1,016,230 | ||||||||||
1,000 | ![]() | Sunrise, Utility Refg Ser 1998 (Ambac) | ![]() | 5.50 | ![]() | 10/01/18 | ![]() | 1,145,420 | ||||||||||
6,000 | ![]() | ![]() | ![]() | ![]() | 6,421,570 | |||||||||||||
![]() | Refunded (4.3%) | |||||||||||||||||
1,500 | ![]() | Puerto Rico Infrastructure Financing Authority, 2000 Ser A (ETM) # | ![]() | 5.375 | ![]() | 10/01/24 | ![]() | 1,620,180 | ||||||||||
34,385 | ![]() | Total Florida Tax-Exempt Municipal Bonds (Cost $33,800,293) | ![]() | 35,961,513 | ||||||||||||||
![]() | Short-Term Florida Tax-Exempt Municipal Obligations (2.9%) | |||||||||||||||||
700 | ![]() | Jacksonville Electric Authority, 2000 Ser A (Demand 12/01/03) | ![]() | 1.10 | ** | ![]() | 10/01/10 | ![]() | 700,000 | |||||||||
400 | ![]() | Orange County School Board, 2000 Ser B COPs (Ambac) (Demand 12/01/03) | ![]() | 1.08 | ** | ![]() | 08/01/25 | ![]() | 400,000 | |||||||||
1,100 | ![]() | Total Short-Term Florida Tax-Exempt Obligations (Cost $1,100,000) | ![]() | 1,100,000 | ||||||||||||||
$ | 35,485 | ![]() | Total Investments (Cost $34,900,293) (a) (b) | ![]() | 98.5 | % | ![]() | 37,061,513 | ||||||||||
![]() | Other Assets in Excess of Liabilities | ![]() | 1.5 | ![]() | 560,999 | |||||||||||||
![]() | Net Assets | ![]() | 100.0 | % | ![]() | $ | 37,622,512 | |||||||||||
![]() |
See Notes to Financial Statements
19
Morgan Stanley Multi-State Municipal Series Trust — Florida Series
Portfolio of Investments November 30, 2003 continued
![]() |
![]() | AMT | Alternative Minimum Tax. |
![]() | COPs | Certificates of Participation. |
![]() | ETM | Escrowed to maturity. |
![]() | * | Puerto Rico issues represent 6.9% of net assets. |
![]() | ** | Current coupon of variable rate demand obligation. |
![]() | # | A portion of this security has been physically segregated in connection with open futures contracts. |
![]() | (a) | Securities have been designated as collateral in an amount equal to $1,140,461 in connection with the open futures contracts. |
![]() | (b) | The aggregate cost for federal income tax purposes is $34,900,200. The aggregate gross unrealized appreciation is $2,162,828 and the aggregate gross unrealized depreciation is $1,515, resulting in net unrealized appreciation of $2,161,313. |
Bond Insurance: |
![]() | Ambac | Ambac Assurance Corporation. |
![]() | Connie Lee | Connie Lee Insurance Company – A wholly owned subsidiary of Ambac Assurance Corporation. |
![]() | FGIC | Financial Guaranty Insurance Company. |
![]() | FSA | Financial Security Assurance Inc. |
![]() | MBIA | Municipal Bond Investors Assurance Corporation. |
Futures Contracts Open at November 30, 2003:
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
NUMBER OF CONTRACTS | ![]() | LONG/SHORT | ![]() | DESCRIPTION, DELIVERY MONTH AND YEAR | ![]() | UNDERLYING FACE AMOUNT AT VALUE | ![]() | UNREALIZED APPRECIATION | ||||||||||
20 | ![]() | Short | ![]() | U.S. Treasury Note 5 Yr March/2004 | ![]() | $(2,207,500) | ![]() | $13,026 | ||||||||||
![]() |
See Notes to Financial Statements
20
Morgan Stanley Multi-State Municipal Series Trust — New Jersey Series
Portfolio of Investments November 30, 2003
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | |
PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | ||||||||||||
![]() | New Jersey Tax-Exempt Municipal Bonds* (94.6%) | ![]() | |||||||||||||||||
![]() | General Obligation (3.1%) | ||||||||||||||||||
$ | 1,000 | ![]() | Burlington County Bridge Commission, Pooled Loan Ser 2002 | ![]() | 5.00 | % | ![]() | 10/15/19 | ![]() | $ | 1,059,130 | ||||||||
![]() | Educational Facilities Revenue (10.3%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
![]() | New Jersey Educational Facilities Authority, | ![]() | ![]() | ![]() | |||||||||||||||
1,000 | ![]() | Drew University Ser 2003 C (FGIC) | ![]() | 5.25 | ![]() | 07/01/19 | ![]() | 1,119,810 | |||||||||||
800 | ![]() | Rowan University Ser 2003 I (FGIC) | ![]() | 5.125 | ![]() | 07/01/21 | ![]() | 849,784 | |||||||||||
500 | ![]() | Stevens Institute of Technology 2002 Ser C | ![]() | 5.25 | ![]() | 07/01/32 | ![]() | 507,695 | |||||||||||
1,000 | ![]() | University of Medicine & Dentistry, 1997 Ser A (MBIA) | ![]() | 5.00 | ![]() | 09/01/17 | ![]() | 1,067,590 | |||||||||||
3,300 | ![]() | ![]() | ![]() | ![]() | 3,544,879 | ![]() | |||||||||||||
![]() | Hospital Revenue (11.2%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
![]() | New Jersey Health Care Facilities Financing Authority, | ![]() | ![]() | ![]() | |||||||||||||||
1,000 | ![]() | AHS Hospital Corp Ser 1997 A (Ambac) | ![]() | 6.00 | ![]() | 07/01/13 | ![]() | 1,183,810 | |||||||||||
2,500 | ![]() | Robert Wood Johnson University Hospital Ser 2000 | ![]() | 5.75 | ![]() | 07/01/25 | ![]() | 2,661,025 | |||||||||||
3,500 | ![]() | ![]() | ![]() | ![]() | 3,844,835 | ||||||||||||||
![]() | Industrial Development/Pollution Control Revenue (2.9%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Salem County Pollution Control Financing Authority, E I du Pont de Nemours & Co 1992 Ser A (AMT) | ![]() | 6.125 | ![]() | 07/15/22 | ![]() | 1,011,610 | |||||||||||
![]() | Mortgage Revenue – Multi-Family (6.1%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
2,000 | ![]() | New Jersey Housing & Mortgage Finance Agency, 1995 Ser A (Ambac) | ![]() | 6.00 | ![]() | 11/01/14 | ![]() | 2,082,520 | |||||||||||
![]() | Mortgage Revenue – Single Family (5.2%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
1,685 | ![]() | New Jersey Housing & Mortgage Finance Agency, Home Buyer Ser 2000 CC (AMT) (MBIA) | ![]() | 5.875 | ![]() | 10/01/31 | ![]() | 1,771,407 | |||||||||||
![]() | Nursing & Health Related Facilities Revenue (2.4%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
805 | ![]() | New Jersey Health Care Facilities Financing Authority, Spectrum for Living – FHA Insured Mortgage Refg Ser B | ![]() | 6.50 | ![]() | 02/01/22 | ![]() | 814,588 | |||||||||||
![]() | Public Facilities Revenue (15.4%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Essex County Improvement Authority, Ser 2002 (MBIA) | ![]() | 5.25 | ![]() | 10/01/19 | ![]() | 1,084,900 | |||||||||||
1,000 | ![]() | Middlesex County, Ser 2001 COPs (MBIA) | ![]() | 5.00 | ![]() | 08/01/22 | ![]() | 1,040,310 | |||||||||||
1,000 | ![]() | Middlesex County Improvement Authority, Open Space Ser 2003 | ![]() | 5.25 | ![]() | 09/15/21 | ![]() | 1,080,640 | |||||||||||
![]() |
See Notes to Financial Statements
21
Morgan Stanley Multi-State Municipal Series Trust — New Jersey Series
Portfolio of Investments November 30, 2003 continued
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![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | |
PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | ||||||||||||
$ | 1,000 | ![]() | New Jersey Economic Development Authority, School Facilities Construction 2001 Ser A (Ambac) | ![]() | 5.25 | % | ![]() | 06/15/19 | ![]() | $ | 1,083,360 | ||||||||
1,000 | ![]() | Puerto Rico Infrastructure Financing Authority, Special Tax Ser 1997A (Ambac) | ![]() | 5.00 | ![]() | 07/01/28 | ![]() | 1,021,640 | |||||||||||
5,000 | ![]() | ![]() | ![]() | ![]() | 5,310,850 | ||||||||||||||
![]() | Recreational Facilities Revenue (1.5%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
500 | ![]() | New Jersey Sports & Exposition Authority, State Contract 1993 Ser A | ![]() | 5.50 | ![]() | 09/01/23 | ![]() | 505,425 | |||||||||||
![]() | Resource Recovery Revenue (2.6%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
900 | ![]() | Warren County Pollution Control Financing Authority, Warren Energy Resource Co Ltd Partnership Ser 1984 (MBIA) | ![]() | 6.60 | ![]() | 12/01/07 | ![]() | 905,454 | |||||||||||
![]() | Transportation Facilities Revenue (13.9%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Delaware River Bay Authority, Ser 2003 (MBIA) # | ![]() | 5.25 | ![]() | 01/01/22 | ![]() | 1,069,660 | |||||||||||
1,000 | ![]() | Delaware River Port Authority, Ser 1995 (FGIC) ## | ![]() | 5.50 | ![]() | 01/01/26 | ![]() | 1,068,660 | |||||||||||
1,000 | ![]() | New Jersey Turnpike Authority, Ser 2003 A (FGIC) | ![]() | 5.00 | ![]() | 01/01/27 | ![]() | 1,026,400 | |||||||||||
1,500 | ![]() | Port Authority of New York & New Jersey, Cons 99th Ser (AMT) (FGIC) ### | ![]() | 5.75 | ![]() | 05/01/15 | ![]() | 1,596,645 | |||||||||||
4,500 | ![]() | ![]() | ![]() | ![]() | 4,761,365 | ![]() | |||||||||||||
![]() | Water & Sewer Revenue (16.9%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
500 | ![]() | Bergen County Utilities Authority, Water 1998 Ser A (FGIC) | ![]() | 4.75 | ![]() | 12/15/15 | ![]() | 520,340 | |||||||||||
1,000 | ![]() | Camden County Municipal Utilities Authority, Sewer Refg Ser 1997 (FGIC) | ![]() | 5.25 | ![]() | 07/15/17 | ![]() | 1,093,730 | |||||||||||
1,000 | ![]() | North Hudson Sewerage Authority, Refg Ser 2002 A (FGIC) | ![]() | 5.25 | ![]() | 08/01/19 | ![]() | 1,083,560 | |||||||||||
1,000 | ![]() | Northwest Bergen County Utilities Authority, Refg 1992 Ser (MBIA) | ![]() | 6.00 | ![]() | 07/15/13 | ![]() | 1,023,870 | |||||||||||
1,000 | ![]() | Passaic Valley Sewerage Commissioners, Ser F (FGIC) | ![]() | 5.00 | ![]() | 12/01/20 | ![]() | 1,058,530 | |||||||||||
1,000 | ![]() | Puerto Rico Public Finance Corporation, 2001 Ser A (MBIA) | ![]() | 5.00 | ![]() | 08/01/29 | ![]() | 1,025,880 | |||||||||||
5,500 | ![]() | ![]() | ![]() | ![]() | 5,805,910 | ![]() | |||||||||||||
![]() | Refunded (3.1%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Puerto Rico Infrastructure Financing Authority, 2000 Ser A (ETM)† | ![]() | 5.375 | ![]() | 10/01/24 | ![]() | 1,080,120 | |||||||||||
30,690 | ![]() | Total New Jersey Tax-Exempt Municipal Obligations (Cost $30,932,410) | ![]() | 32,498,093 | ![]() | ||||||||||||||
![]() |
See Notes to Financial Statements
22
Morgan Stanley Multi-State Municipal Series Trust — New Jersey Series
Portfolio of Investments November 30, 2003 continued
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | |
PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | ||||||||||||
![]() | Short-Term New Jersey Tax-Exempt Municipal Obligations (3.7%) | ![]() | ![]() | ![]() | ![]() | ||||||||||||||
$ | 260 | ![]() | New Jersey Educational Facilities Authority, Princeton University 2003 Ser F (Demand 12/01/03) | ![]() | 0.98** | % | ![]() | 07/01/23 | ![]() | $ | 260,000 | ||||||||
1,000 | ![]() | New Jersey Housing & Mortgage Finance Agency, Presidential Plaza at Newport – FHA Insured Mtges Refg 1991 Ser 1 (Tender receivable 12/16/03) | ![]() | 7.00 | ![]() | 05/01/30 | ![]() | 1,014,500 | |||||||||||
1,260 | ![]() | Total Short-Term New Jersey Tax-Exempt Municipal Obligations (Cost $1,260,000) | ![]() | 1,274,500 | |||||||||||||||
$ | 31,950 | ![]() | Total Investments (Cost $32,192,410) (a) (b) | ![]() | 98.3 | % | ![]() | 33,772,593 | |||||||||||
![]() | Other Assets in Excess of Liabilities | ![]() | 1.7 | ![]() | 598,093 | ||||||||||||||
![]() | Net Assets | ![]() | 100.0 | % | ![]() | $ | 34,370,686 | ||||||||||||
![]() |
![]() |
![]() | AMT | Alternative Minimum Tax. |
![]() | COPs | Certificates of Participation. |
![]() | ETM | Escrowed to maturity. |
![]() | # | Joint exemption in New Jersey and Delaware. |
![]() | ## | Joint exemption in New Jersey and Pennsylvania. |
![]() | ### | Joint exemption in New Jersey and New York. |
![]() | * | Puerto Rico issues represent 9.1% of net assets. |
![]() | ** | Current coupon of variable rate demand obligation. |
![]() | † | This security has been physically segregated in connection with open futures contracts. |
![]() | (a) | Securities have been designated as collateral in an amount equal to $3,933,429 in connection with open futures contracts. |
![]() | (b) | The aggregate cost for federal income tax purposes is $32,182,269. The aggregate gross unrealized appreciation is $1,656,266 and the aggregate gross unrealized depreciation is $65,942, resulting in net unrealized appreciation of $1,590,324. |
Bond Insurance: |
![]() | Ambac | Ambac Assurance Corporation. |
![]() | FGIC | Financial Guaranty Insurance Company. |
![]() | MBIA | Municipal Bond Investors Assurance Corporation. |
Futures Contracts Open at November 30, 2003:
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![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
NUMBER OF CONTRACTS | ![]() | LONG/SHORT | ![]() | DESCRIPTION, DELIVERY MONTH AND YEAR | ![]() | UNDERLYING FACE AMOUNT AT VALUE | ![]() | UNREALIZED APPRECIATION | ||||||||||
25 | ![]() | Short | ![]() | U.S. Treasury Note 5 Yr March/2004 | ![]() | $(2,759,375) | ![]() | $16,293 | ||||||||||
20 | ![]() | Short | ![]() | U.S. Treasury Note 10 Yr March/2004 | ![]() | (2,217,813) | ![]() | 19,945 | ||||||||||
![]() | ![]() | Total unrealized appreciation | ![]() | $36,238 | ||||||||||||||
![]() |
See Notes to Financial Statements
23
Morgan Stanley Multi-State Municipal Series Trust — Pennsylvania Series
Portfolio of Investments November 30, 2003
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![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | |||||||||||
![]() | Pennsylvania Tax-Exempt Municipal Bonds*(93.3%) | ![]() | ![]() | ![]() | ||||||||||||||
![]() | General Obligation (17.7%) | ![]() | ![]() | ![]() | ||||||||||||||
$ | 1,600 | ![]() | Butler County, Ser 2003 (FGIC) | ![]() | 5.25 | % | ![]() | 07/15/26 | ![]() | $ | 1,687,104 | |||||||
1,000 | ![]() | Luzerne County, Ser A 2003 (MBIA) | ![]() | 5.25 | ![]() | 11/15/19 | ![]() | 1,090,670 | ||||||||||
![]() | Pennsylvania, | ![]() | ![]() | ![]() | ||||||||||||||
500 | ![]() | RITES PA – 1112 A (MBIA) | ![]() | 8.649 | ‡ | ![]() | 01/01/18 | ![]() | 569,655 | |||||||||
500 | ![]() | RITES PA – 1112 B (MBIA) | ![]() | 8.649 | ‡ | ![]() | 01/01/19 | ![]() | 562,625 | |||||||||
2,000 | ![]() | Puerto Rico Municipal Finance Agency, 2002 Ser A (FSA) | ![]() | 5.25 | ![]() | 08/01/20 | ![]() | 2,170,160 | ||||||||||
5,600 | ![]() | ![]() | ![]() | ![]() | 6,080,214 | |||||||||||||
![]() | Educational Facilities Revenue (18.7%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Allegheny County Higher Education Building Authority, Carnegie Mellon University Ser 2002 | ![]() | 5.25 | ![]() | 03/01/32 | ![]() | 1,031,200 | ||||||||||
1,000 | ![]() | Delaware County Authority, Villanova University Ser 1995 (Ambac) | ![]() | 5.80 | ![]() | 08/01/25 | ![]() | 1,077,090 | ||||||||||
1,000 | ![]() | Pennsylvania Higher Educational Facilities Authority, Drexel University Ser 2003 | ![]() | 5.50 | ![]() | 05/01/18 | ![]() | 1,084,660 | ||||||||||
1,000 | ![]() | Thomas Jefferson University Ser 2002 | ![]() | 5.375 | ![]() | 01/01/25 | ![]() | 1,047,550 | ||||||||||
1,000 | ![]() | Pennsylvania State University, Refg Ser 2002 | ![]() | 5.25 | ![]() | 08/15/13 | ![]() | 1,132,440 | ||||||||||
1,000 | ![]() | Swarthmore Boro Authority, Swarthmore College Ser 2001 | ![]() | 5.00 | ![]() | 09/15/31 | ![]() | 1,018,350 | ||||||||||
6,000 | ![]() | ![]() | ![]() | ![]() | 6,391,290 | |||||||||||||
![]() | Electric Revenue (3.0%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Puerto Rico Electric Power Authority, Power Ser DD (FSA) | ![]() | 4.50 | ![]() | 07/01/19 | ![]() | 1,019,680 | ||||||||||
![]() | Hospital Revenue (11.0%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Lehigh County General Purpose Authority, Lehigh Valley Health Ser B 2001 (FSA) | ![]() | 5.00 | ![]() | 07/01/31 | ![]() | 1,019,420 | ||||||||||
1,000 | ![]() | St Luke's Hospital of Bethlehem Ser 2003 | ![]() | 5.25 | ![]() | 08/15/23 | ![]() | 984,830 | ||||||||||
1,750 | ![]() | Philadelphia Hospitals & Higher Education Facilities Authority, Chestnut Hill Hospital Ser of 1992 | ![]() | 6.375 | ![]() | 11/15/11 | ![]() | 1,759,712 | ||||||||||
3,750 | ![]() | ![]() | ![]() | ![]() | 3,763,962 | |||||||||||||
![]() | Industrial Development/Pollution Control Revenue (6.1%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Carbon County Industrial Development Authority, Panther Creek Partners Refg 2000 Ser (AMT) | ![]() | 6.65 | ![]() | 05/01/10 | ![]() | 1,084,700 | ||||||||||
1,000 | ![]() | Delaware County Industrial Development Authority, Suburban Water Co Ser A 2002 (AMT) (Ambac) | ![]() | 5.15 | ![]() | 09/01/32 | ![]() | 1,018,430 | ||||||||||
2,000 | ![]() | ![]() | ![]() | ![]() | 2,103,130 | |||||||||||||
![]() | Mortgage Revenue – Single Family (4.5%) | ![]() | ![]() | ![]() | ||||||||||||||
1,500 | ![]() | Pennsylvania Housing Finance Agency, Ser 2000-70 A (AMT) | ![]() | 5.90 | ![]() | 04/01/31 | ![]() | 1,561,230 | ||||||||||
![]() |
See Notes to Financial Statements
24
Morgan Stanley Multi-State Municipal Series Trust — Pennsylvania Series
Portfolio of Investments November 30, 2003 continued
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PRINCIPAL AMOUNT IN THOUSANDS | ![]() | ![]() | COUPON RATE | ![]() | MATURITY DATE | ![]() | VALUE | |||||||||||
![]() | Public Facilities Revenue (3.2%) | ![]() | ![]() | ![]() | ||||||||||||||
$ | 1,000 | ![]() | York County School of Technology, Ser 2003 (FGIC) | ![]() | 5.50 | % | ![]() | 02/15/23 | ![]() | $ | 1,085,280 | |||||||
![]() | Recreational Facilities Revenue (6.0%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Philadelphia Industrial Development Authority, Stadium Ser B 2001 (FSA) | ![]() | 5.50 | ![]() | 10/01/17 | ![]() | 1,108,450 | ||||||||||
1,000 | ![]() | The Franklin Institute Ser 1998 | ![]() | 5.20 | ![]() | 06/15/26 | ![]() | 947,880 | ||||||||||
2,000 | ![]() | ![]() | ![]() | ![]() | 2,056,330 | |||||||||||||
![]() | Resource Recovery Revenue (3.3%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Montgomery County Industrial Development Authority, Refg 2002 A (MBIA) | ![]() | 5.25 | ![]() | 11/01/14 | ![]() | 1,128,150 | ||||||||||
![]() | Transportation Facilities Revenue (5.9%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Delaware River Port Authority, Ser 1995 (FGIC) # | ![]() | 5.50 | ![]() | 01/01/26 | ![]() | 1,068,660 | ||||||||||
1,000 | ![]() | Puerto Rico Highway & Transportation Authority, Ser 1998 A | ![]() | 4.75 | ![]() | 07/01/38 | ![]() | 962,990 | ||||||||||
2,000 | ![]() | ![]() | ![]() | ![]() | 2,031,650 | |||||||||||||
![]() | Water & Sewer Revenue (10.9%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Allegheny County Sanitary Authority, Sewer Ser 2000 (MBIA) | ![]() | 5.50 | ![]() | 12/01/24 | ![]() | 1,083,530 | ||||||||||
1,000 | ![]() | Pennsylvania Finance Authority, Penn Hills Ser A 2000 (FGIC) | ![]() | 5.50 | ![]() | 12/01/22 | ![]() | 1,097,100 | ||||||||||
1,000 | ![]() | Philadelphia, Water & Wastewater Ser 1995 (MBIA)† | ![]() | 6.25 | ![]() | 08/01/11 | ![]() | 1,202,500 | ||||||||||
1,250 | ![]() | Pittsburgh Water & Sewer Authority, 1998 Ser B (FGIC) | ![]() | 0.00 | ![]() | 09/01/28 | ![]() | 337,500 | ||||||||||
4,250 | ![]() | ![]() | ![]() | ![]() | 3,720,630 | |||||||||||||
![]() | Other Revenue (3.0%) | ![]() | ![]() | ![]() | ||||||||||||||
1,000 | ![]() | Philadelphia, Gas Works Third Ser 1998 (FSA) | ![]() | 5.125 | ![]() | 08/01/31 | ![]() | 1,028,870 | ||||||||||
31,100 | ![]() | Total Pennsylvania Tax-Exempt Municipal Bonds (Cost $30,410,010) | ![]() | 31,970,416 | ||||||||||||||
![]() | Short-Term Pennsylvania Tax-Exempt Municipal Obligations (5.0%) | ![]() | ![]() | ![]() | ||||||||||||||
100 | ![]() | Lehigh County General Purpose Authority, Lehigh Valley Hospital Ser 1997 A (Ambac) (Demand 12/01/03) | ![]() | 1.03 | ** | ![]() | 07/01/28 | ![]() | 100,000 | |||||||||
1,600 | ![]() | Philadelphia Hospitals & Higher Education Facilities Authority, Children's Hospital of Philadelphia Ser 2002 A (Demand 12/01/03) | ![]() | 1.10 | ** | ![]() | 07/01/22 | ![]() | 1,600,000 | |||||||||
1,700 | ![]() | Total Short-Term Pennsylvania Tax-Exempt Obligations (Cost $1,700,000) | ![]() | 1,700,000 | ||||||||||||||
$ | 32,800 | ![]() | Total Investments (Cost $32,110,010) (a) (b) | ![]() | 98.3 | % | ![]() | 33,670,416 | ||||||||||
![]() | Other Assets in Excess of Liabilities | ![]() | 1.7 | ![]() | 567,192 | |||||||||||||
![]() | Net Assets | ![]() | 100.0 | % | ![]() | $ | 34,237,608 | |||||||||||
![]() |
See Notes to Financial Statements
25
Morgan Stanley Multi-State Municipal Series Trust — Pennsylvania Series
Portfolio of Investments November 30, 2003 continued
![]() |
![]() | AMT | Alternative Minimum Tax. |
![]() | RITES | Residual Interest Tax-Exempt Securities. |
![]() | # | Joint exemption in Pennsylvania and New Jersey. |
![]() | † | This security has been physically segregated in connection with open futures contracts. |
![]() | ‡ | Current coupon rate for inverse floating rate municipal obligations. This rate resets periodically as the auction rate, on the related security changes. Positions in inverse floating rate municipal obligations have a total value of $1,132,280 which represents 3.3% of net assets. |
![]() | * | Puerto Rico issues represent 12.1% of net assets. |
![]() | ** | Current coupon of variable rate demand obligation. |
![]() | (a) | Securities have been designated as collateral in an amount equal to $8,833,193 in connection with the open futures contracts. |
![]() | (b) | The aggregate cost for federal income tax purposes is $32,108,922. The aggregate gross unrealized appreciation is $1,589,584 and the aggregate gross unrealized depreciation is $28,090, resulting in net unrealized appreciation of $1,561,494. |
Bond Insurance: |
![]() | Ambac | Ambac Assurance Corporation. |
![]() | FGIC | Financial Guaranty Insurance Company. |
![]() | FSA | Financial Security Assurance Inc. |
![]() | MBIA | Municipal Bond Investors Assurance Corporation. |
Futures Contracts Open at November 30, 2003:
![](https://capedge.com/proxy/N-CSR/0000950136-04-000288/spacer.gif)
![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
NUMBER OF CONTRACTS | ![]() | LONG/SHORT | ![]() | DESCRIPTION, DELIVERY MONTH AND YEAR | ![]() | UNDERLYING FACE AMOUNT AT VALUE | ![]() | UNREALIZED APPRECIATION | ||||||||||
40 | ![]() | Short | ![]() | U.S. Treasury Note 5 Yr March/2004 | ![]() | $(4,415,000) | ![]() | $26,052 | ||||||||||
50 | ![]() | Short | ![]() | U.S. Treasury Note 10 Yr March/2004 | ![]() | (5,544,532) | ![]() | 49,862 | ||||||||||
![]() | ![]() | Total unrealized appreciation | ![]() | $75,914 | ||||||||||||||
![]() |
See Notes to Financial Statements
26
Morgan Stanley Multi-State Municipal Series Trust
Financial Statements
Statement of Assets and Liabilities
November 30, 2003
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![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||
Assets: | ||||||||||||||||||
Investments in securities, at value* | ![]() | $ | 27,793,439 | ![]() | $ | 37,061,513 | ![]() | $ | 33,772,593 | ![]() | $ | 33,670,416 | ||||||
Cash | ![]() | 173,005 | ![]() | 142,946 | ![]() | 64,219 | ![]() | 75,260 | ||||||||||
Receivable for: | ||||||||||||||||||
Interest | ![]() | 548,088 | ![]() | 406,437 | ![]() | 532,253 | ![]() | 487,120 | ||||||||||
Shares of beneficial interest sold | ![]() | — | ![]() | 52,514 | ![]() | 21,726 | ![]() | — | ||||||||||
Variation margin | ![]() | 34,140 | ![]() | 10,000 | ![]() | 27,812 | ![]() | 58,281 | ||||||||||
Prepaid expenses | ![]() | 5,837 | ![]() | 5,578 | ![]() | 6,336 | ![]() | 4,168 | ||||||||||
Total Assets | ![]() | 28,554,509 | ![]() | 37,678,988 | ![]() | 34,424,939 | ![]() | 34,295,245 | ||||||||||
Liabilities: | ||||||||||||||||||
Payable for: | ||||||||||||||||||
Dividends to shareholders | ![]() | 9,036 | ![]() | 13,088 | ![]() | 12,290 | ![]() | 11,699 | ||||||||||
Investment management fee | ![]() | 8,155 | ![]() | 10,796 | ![]() | 9,896 | ![]() | 9,806 | ||||||||||
Shares of beneficial interest redeemed | ![]() | 197 | ![]() | — | ![]() | — | ![]() | 5,100 | ||||||||||
Distribution fee | ![]() | 3,495 | ![]() | 4,627 | ![]() | 4,241 | ![]() | 4,202 | ||||||||||
Accrued expenses | ![]() | 24,875 | ![]() | 27,965 | ![]() | 27,826 | ![]() | 26,830 | ||||||||||
Total Liabilities | ![]() | 45,758 | ![]() | 56,476 | ![]() | 54,253 | ![]() | 57,637 | ||||||||||
Net Assets | ![]() | $ | 28,508,751 | ![]() | $ | 37,622,512 | ![]() | $ | 34,370,686 | ![]() | $ | 34,237,608 | ||||||
Composition of Net Assets: | ||||||||||||||||||
Paid-in-capital | ![]() | $ | 26,796,144 | ![]() | $ | 35,248,858 | ![]() | $ | 32,617,473 | ![]() | $ | 32,461,097 | ||||||
Accumulated undistributed net investment income | ![]() | 6,164 | ![]() | 8,624 | ![]() | 18,313 | ![]() | 8,851 | ||||||||||
Accumulated undistributed net realized gain | ![]() | 98,065 | ![]() | 190,784 | ![]() | 118,479 | ![]() | 131,340 | ||||||||||
Net unrealized appreciation | ![]() | 1,608,378 | ![]() | 2,174,246 | ![]() | 1,616,421 | ![]() | 1,636,320 | ||||||||||
Net Assets | ![]() | $ | 28,508,751 | ![]() | $ | 37,622,512 | ![]() | $ | 34,370,686 | ![]() | $ | 34,237,608 | ||||||
*Cost | ![]() | $ | 26,229,671 | ![]() | $ | 34,900,293 | ![]() | $ | 32,192,410 | ![]() | $ | 32,110,010 | ||||||
Shares of Beneficial Interest Outstanding | ![]() | 2,676,716 | ![]() | 3,512,436 | ![]() | 3,172,550 | ![]() | 3,120,032 | ||||||||||
Net Asset Value Per Share, (unlimited authorized shares of $.01 par value) | ![]() | $10.65 | ![]() | $10.71 | ![]() | $10.83 | ![]() | $10.97 | ||||||||||
Maximum Offering Price Per Share, (net asset value plus 4.17% of net asset value) | ![]() | $11.09 | ![]() | $11.16 | ![]() | $11.28 | ![]() | $11.43 | ||||||||||
![]() |
See Notes to Financial Statements
27
Morgan Stanley Multi-State Municipal Series Trust
Financial Statements continued
Statement of Operations
For the year ended November 30, 2003
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![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||
Net Investment Income: | ||||||||||||||||||
Interest Income | ![]() | $ | 1,372,936 | ![]() | $ | 1,856,109 | ![]() | $ | 1,805,897 | ![]() | $ | 1,707,621 | ||||||
Expenses | ||||||||||||||||||
Investment management fee | ![]() | 103,034 | ![]() | 134,105 | ![]() | 125,976 | ![]() | 119,371 | ||||||||||
Distribution fee | ![]() | 44,158 | ![]() | 57,237 | ![]() | 53,990 | ![]() | 50,596 | ||||||||||
Professional fees | ![]() | 24,263 | ![]() | 22,946 | ![]() | 18,506 | ![]() | 21,363 | ||||||||||
Transfer agent fees and expenses | ![]() | 12,350 | ![]() | 15,012 | ![]() | 17,832 | ![]() | 14,507 | ||||||||||
Shareholder reports and notices | ![]() | 9,648 | ![]() | 14,565 | ![]() | 17,158 | ![]() | 14,244 | ||||||||||
Registration fees | ![]() | 9,536 | ![]() | 5,047 | ![]() | 5,429 | ![]() | — | ||||||||||
Trustees' fees and expenses | ![]() | 3,598 | ![]() | 2,969 | ![]() | 6,505 | ![]() | 2,815 | ||||||||||
Custodian fees | ![]() | 3,235 | ![]() | 2,733 | ![]() | 3,124 | ![]() | 3,588 | ||||||||||
Other | ![]() | 6,092 | ![]() | 5,934 | ![]() | 6,115 | ![]() | 5,361 | ||||||||||
Total Expenses | ![]() | 215,914 | ![]() | 260,548 | ![]() | 254,635 | ![]() | 231,845 | ||||||||||
Less: expense offset | ![]() | (3,125 | ) | ![]() | (2,620 | ) | ![]() | (3,055 | ) | ![]() | (3,459 | ) | ||||||
Net Expenses | ![]() | 212,789 | ![]() | 257,928 | ![]() | 251,580 | ![]() | 228,386 | ||||||||||
Net Investment Income | ![]() | 1,160,147 | ![]() | 1,598,181 | ![]() | 1,554,317 | ![]() | 1,479,235 | ||||||||||
Net Realized and Unrealized Gain (Loss): | ||||||||||||||||||
Net Realized Gain (Loss) on: | ||||||||||||||||||
Investments | ![]() | 127,321 | ![]() | 225,988 | ![]() | 91,904 | ![]() | 171,906 | ||||||||||
Futures contracts | ![]() | (29,287 | ) | ![]() | (35,217 | ) | ![]() | 26,144 | ![]() | (40,613 | ) | |||||||
Net Realized Gain | ![]() | 98,034 | ![]() | 190,771 | ![]() | 118,048 | ![]() | 131,293 | ||||||||||
Net Change in Unrealized Appreciation on: | ||||||||||||||||||
Investments | ![]() | 738,631 | ![]() | 740,440 | ![]() | 383,603 | ![]() | 706,921 | ||||||||||
Futures contracts | ![]() | 44,610 | ![]() | 13,026 | ![]() | 36,238 | ![]() | 75,914 | ||||||||||
Net Appreciation | ![]() | 783,241 | ![]() | 753,466 | ![]() | 419,841 | ![]() | 782,835 | ||||||||||
Net Gain | ![]() | 881,275 | ![]() | 944,237 | ![]() | 537,889 | ![]() | 914,128 | ||||||||||
Net Increase | ![]() | $ | 2,041,422 | ![]() | $ | 2,542,418 | ![]() | $ | 2,092,206 | ![]() | $ | 2,393,363 | ||||||
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See Notes to Financial Statements
28
Morgan Stanley Multi-State Municipal Series Trust
Financial Statements continued
Statement of Changes in Net Assets
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![]() | ARIZONA | ![]() | FLORIDA | ![]() | |||||||||||||||
![]() | FOR THE YEAR ENDED NOVEMBER 30, 2003 | ![]() | FOR THE YEAR ENDED NOVEMBER 30, 2002 | ![]() | FOR THE YEAR ENDED NOVEMBER 30, 2003 | ![]() | FOR THE YEAR ENDED NOVEMBER 30, 2002 | ||||||||||||
Increase (Decrease) in Net Assets: | |||||||||||||||||||
Operations: | |||||||||||||||||||
Net investment income | ![]() | $ | 1,160,147 | ![]() | $ | 1,305,997 | ![]() | $ | 1,598,181 | ![]() | $ | 1,897,326 | |||||||
Net realized gain | ![]() | 98,034 | ![]() | 326,643 | ![]() | 190,771 | ![]() | 681,036 | |||||||||||
Net change in unrealized appreciation | ![]() | 783,241 | ![]() | 61,360 | ![]() | 753,466 | ![]() | (333,166 | ) | ||||||||||
Net Increase | ![]() | 2,041,422 | ![]() | 1,694,000 | ![]() | 2,542,418 | ![]() | 2,245,196 | |||||||||||
Dividends and Distributions to Shareholders from: | |||||||||||||||||||
Net investment income | ![]() | (1,157,632 | ) | ![]() | (1,302,378 | ) | ![]() | (1,646,267 | ) | ![]() | (1,891,394 | ) | |||||||
Net realized gain | ![]() | (326,845 | ) | ![]() | (66,842 | ) | ![]() | (694,053 | ) | ![]() | (135,896 | ) | |||||||
Total Dividend and Distributions | ![]() | (1,484,477 | ) | ![]() | (1,369,220 | ) | ![]() | (2,340,320 | ) | ![]() | (2,027,290 | ) | |||||||
Transactions in Shares of Beneficial Interest: | |||||||||||||||||||
Sold | ![]() | 1,553,695 | ![]() | 1,682,214 | ![]() | 5,769,541 | ![]() | 4,581,829 | |||||||||||
Reinvestment of dividends and distributions | ![]() | 711,758 | ![]() | 641,507 | ![]() | 895,502 | ![]() | 665,499 | |||||||||||
Redeemed | ![]() | (4,560,482 | ) | ![]() | (4,123,198 | ) | ![]() | (9,871,228 | ) | ![]() | (9,049,359 | ) | |||||||
Net Decrease | ![]() | (2,295,029 | ) | ![]() | (1,799,477 | ) | ![]() | (3,206,185 | ) | ![]() | (3,802,031 | ) | |||||||
Total Decrease | ![]() | (1,738,084 | ) | ![]() | (1,474,697 | ) | ![]() | (3,004,087 | ) | ![]() | (3,584,125 | ) | |||||||
Net Assets: | |||||||||||||||||||
Beginning of period | ![]() | 30,246,835 | ![]() | 31,721,532 | ![]() | 40,626,599 | ![]() | 44,210,724 | |||||||||||
End of Period | ![]() | $ | 28,508,751 | ![]() | $ | 30,246,835 | ![]() | $ | 37,622,512 | ![]() | $ | 40,626,599 | |||||||
Accumulated Undistributed Net Investment Income | ![]() | $ | 6,164 | ![]() | $ | 3,682 | ![]() | $ | 8,624 | ![]() | $ | 56,724 | |||||||
Shares Issued and Redeemed: | |||||||||||||||||||
Sold | ![]() | 147,557 | ![]() | 161,454 | ![]() | 540,451 | ![]() | 428,331 | |||||||||||
Reinvestment of dividends and distributions | ![]() | 67,531 | ![]() | 61,771 | ![]() | 84,004 | ![]() | 62,790 | |||||||||||
Redeemed | ![]() | (434,360 | ) | ![]() | (397,347 | ) | ![]() | (927,084 | ) | ![]() | (849,113 | ) | |||||||
Net Decrease | ![]() | (219,272 | ) | ![]() | (174,122 | ) | ![]() | (302,629 | ) | ![]() | (357,992 | ) | |||||||
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See Notes to Financial Statements
29
Morgan Stanley Multi-State Municipal Series Trust
Financial Statements continued
Statement of Changes in Net Assets continued
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![]() | NEW JERSEY | ![]() | PENNSYLVANIA | ![]() | |||||||||||||||
![]() | FOR THE YEAR ENDED NOVEMBER 30, 2003 | ![]() | FOR THE YEAR ENDED NOVEMBER 30, 2002 | ![]() | FOR THE YEAR ENDED NOVEMBER 30, 2003 | ![]() | FOR THE YEAR ENDED NOVEMBER 30, 2002 | ||||||||||||
Increase (Decrease) in Net Assets: | |||||||||||||||||||
Operations: | |||||||||||||||||||
Net investment income | ![]() | $ | 1,554,317 | ![]() | $ | 1,622,940 | ![]() | $ | 1,479,235 | ![]() | $ | 1,579,972 | |||||||
Net realized gain | ![]() | 118,048 | ![]() | 430,385 | ![]() | 131,293 | ![]() | 243,854 | |||||||||||
Net change in unrealized appreciation | ![]() | 419,841 | ![]() | (193,891 | ) | ![]() | 782,835 | ![]() | (284,848 | ) | |||||||||
Net Increase | ![]() | 2,092,206 | ![]() | 1,859,434 | ![]() | 2,393,363 | ![]() | 1,538,978 | |||||||||||
Dividends and Distributions to Shareholders from: | |||||||||||||||||||
Net investment income | ![]() | (1,548,827 | ) | ![]() | (1,615,666 | ) | ![]() | (1,476,093 | ) | ![]() | (1,574,345 | ) | |||||||
Net realized gain | ![]() | (318,394 | ) | ![]() | — | ![]() | (254,759 | ) | ![]() | — | |||||||||
Total Dividend and Distributions | ![]() | (1,867,221 | ) | ![]() | (1,615,666 | ) | ![]() | (1,730,852 | ) | ![]() | (1,574,345 | ) | |||||||
Transactions in Shares of Beneficial Interest: | |||||||||||||||||||
Sold | ![]() | 2,976,567 | ![]() | 4,749,420 | ![]() | 2,742,433 | ![]() | 2,645,466 | |||||||||||
Reinvestment of dividends and distributions | ![]() | 1,007,456 | ![]() | 840,799 | ![]() | 894,815 | ![]() | 766,720 | |||||||||||
Redeemed | ![]() | (5,722,256 | ) | ![]() | (6,706,663 | ) | ![]() | (3,084,028 | ) | ![]() | (5,868,811 | ) | |||||||
Net Increase (Decrease) | ![]() | (1,738,233 | ) | ![]() | (1,116,444 | ) | ![]() | 553,220 | ![]() | (2,456,625 | ) | ||||||||
Total Increase (Decrease) | ![]() | (1,513,248 | ) | ![]() | (872,676 | ) | ![]() | 1,215,731 | ![]() | (2,491,992 | ) | ||||||||
Net Assets: | |||||||||||||||||||
Beginning of period | ![]() | 35,883,934 | ![]() | 36,756,610 | ![]() | 33,021,877 | ![]() | 35,513,869 | |||||||||||
End of Period | ![]() | $ | 34,370,686 | ![]() | $ | 35,883,934 | ![]() | $ | 34,237,608 | ![]() | $ | 33,021,877 | |||||||
Accumulated Undistributed Net Investment Income | ![]() | $ | 18,313 | ![]() | $ | 13,255 | ![]() | $ | 8,851 | ![]() | $ | 5,759 | |||||||
Shares Issued and Redeemed: | |||||||||||||||||||
Sold | ![]() | 274,830 | ![]() | 441,017 | ![]() | 252,305 | ![]() | 245,641 | |||||||||||
Reinvestment of dividends and distributions | ![]() | 93,226 | ![]() | 78,409 | ![]() | 82,375 | ![]() | 71,268 | |||||||||||
Redeemed | ![]() | (532,208 | ) | ![]() | (626,811 | ) | ![]() | (284,397 | ) | ![]() | (548,168 | ) | |||||||
Net Increase (Decrease) | ![]() | (164,152 | ) | ![]() | (107,385 | ) | ![]() | 50,283 | ![]() | (231,259 | ) | ||||||||
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See Notes to Financial Statements
30
Morgan Stanley Multi-State Municipal Series Trust
Notes to Financial Statements November 30, 2003
1. Organization and Accounting Policies
Morgan Stanley Multi-State Municipal Series Trust (the "Fund") is registered under the Investment Company Act of 1940, as amended (the "Act"), as a non-diversified, open-end management investment company. The investment objective of each Series is to provide a high level of current income exempt from both Federal and the designated state income taxes consistent with preservation of capital.
The Fund, organized on October 29, 1990, as a Massachusetts business trust, is comprised of four separate Series (the "Series"): the Arizona Series, the Florida Series, the New Jersey Series, and the Pennsylvania Series. Each of the Series commenced operations on January 15, 1991, with the exception of the Arizona Series which commenced operations on April 30, 1991.
The following is a summary of significant accounting policies:
A. Valuation of Investments — (1) Portfolio securities are valued by an outside independent pricing service approved by the Trustees. The pricing service uses both a computerized grid matrix of tax-exempt securities and evaluations by its staff, in each case based on information concerning market transactions and quotations from dealers which reflect the mean between the last reported bid and asked price. The portfolio securities are thus valued by reference to a combination of transactions and quotations for the same or other securities believed to be comparable in quality, coupon, maturity, type of issue, call provisions, trading characteristics and other features deemed to be relevant. The Trustees believe that timely and reliable market quotations are generally not readily available for purposes of valuing tax-exempt securities and that the valuations supplied by the pricing service are more likely to approximate the fair value of such securities; (2) futures are valued at the latest sale price on the commodities exchange on which they trade unless it is determined that such price does not reflect their market value, in which case they will be valued at their fair value as determined in good faith under procedures established by and under the supervision of the Trustees; and (3) short-term debt securities having a maturity date of more than sixty days at time of purchase are valued on a mark-to-market basis until sixty days prior to maturity and thereafter at amortized cost based on their value on the 61st day. Short-term debt securities having a maturity date of sixty days or less at the time of purchase are valued at amortized cost.
B. Accounting for Investments — Security transactions are accounted for on the trade date (date the order to buy or sell is executed). Realized gains and losses on security transactions are determined by the identified cost method. Discounts are accreted and premiums are amortized over the life of the respective securities. Interest income is accrued daily.
C. Futures Contracts — A futures contract is an agreement between two parties to buy and sell financial instruments or contracts based on financial indices at a set price on a future date. Upon entering into such a contract, the Fund is required to pledge to the broker cash, U.S. Government securities or other liquid portfolio securities equal to the minimum initial margin requirements of the applicable futures exchange.
31
Morgan Stanley Multi-State Municipal Series Trust
Notes to Financial Statements November 30, 2003 continued
Pursuant to the contract, the Fund agrees to receive from or pay to the broker an amount of cash equal to the daily fluctuation in the value of the contract. Such receipts or payments known as variation margin are recorded by the Fund as unrealized gains and losses. Upon closing of the contract, the Fund realizes a gain or loss equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed.
D. Federal Income Tax Policy — It is the Fund's policy to comply individually for each Series with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable and nontaxable income to its shareholders. Accordingly, no federal income tax provision is required.
E. Dividends and Distributions to Shareholders — Dividends and distributions to shareholders are recorded on the ex-dividend date.
F. Expenses — Direct expenses are charged to the respective Series and general corporate expenses are allocated on the basis of relative net assets or equally among the Series.
G. Use of Estimates — The preparation of financial statements in accordance with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts and disclosures. Actual results could differ from those estimates.
2. Investment Management Agreement
Pursuant to an Investment Management Agreement, each Series of the Fund pays Morgan Stanley Investment Advisors Inc. (the "Investment Manager") a management fee, accrued daily and payable monthly, by applying the annual rate of 0.35% to the daily net assets of each Series determined as of the close of each business day.
3. Plan of Distribution
Morgan Stanley Distributors Inc. (the "Distributor"), an affiliate of the Investment Manager, is the distributor of the Fund's shares and, in accordance with a Plan of Distribution (the "Plan") pursuant to Rule 12b-1 under the Act, provides certain services in connection with the promotion of sales of Fund shares.
Reimbursements for these expenses will be made in monthly payments by the Fund to the Distributor, which will in no event exceed an amount equal to a payment at the annual rate of 0.15% of the Fund's average daily net assets during the month. Expenses incurred by the Distributor pursuant to the Plan in any fiscal year will not be reimbursed by the Fund through payments accrued in any subsequent fiscal year. For the year ended November 30, 2003, the distribution fees were accrued at the following annual rates:
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![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||
Annual Rate | ![]() | 0.15 | % | ![]() | 0.15 | % | ![]() | 0.15 | % | ![]() | 0.15 | % | ||||||
![]() |
32
Morgan Stanley Multi-State Municipal Series Trust
Notes to Financial Statements November 30, 2003 continued
The Distributor has informed the Fund that for the year ended November 30, 2003 it received commissions from the sale of the Fund's shares of beneficial interest as follows:
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![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||
Commissions | ![]() | $ | 40,980 | ![]() | $ | 153,862 | ![]() | $ | 97,597 | ![]() | $ | 88,942 | ||||||
![]() |
Such commissions are deducted from the proceeds of the sale of the Fund's shares and are not an expense of the Fund.
4. Security Transactions and Transactions with Affiliates
The cost of purchases and proceeds from the sales of portfolio securities, excluding short-term investments, for the year ended November 30, 2003 were as follows:
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![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||
Purchases | ![]() | $ | 3,209,798 | ![]() | $ | 3,045,830 | ![]() | $ | 8,540,887 | ![]() | $ | 11,006,709 | ||||||
Sales | ![]() | $ | 5,537,733 | ![]() | $ | 7,048,222 | ![]() | $ | 9,021,318 | ![]() | $ | 8,620,625 | ||||||
![]() |
Included in the aformentioned sales of the Florida Series are $527,120 with Morgan Stanley Hawaii Municipal Trust, an affiliate of the Fund, including a net realized gain of $35,010.
The Fund has an unfunded noncontributory defined benefit pension plan covering certain independent Trustees of the Fund who will have served as independent Trustees for at least five years at the time of retirement. Benefits under this plan are based on factors which include years of service and compensation. Aggregate pension costs for the year ended November 30, 2003 included in Trustees' fees and expenses in the Statement of Operations and the accrued pension liability included in accrued expenses in the Statement of Assets and Liabilities for each of the respective Series were as follows:
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![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||
Aggregate Pension Costs | ![]() | $ | 1,638 | ![]() | $ | 16 | ![]() | $ | 3,829 | ![]() | $ | 605 | ||||||
Accrued Pension Liability | ![]() | $ | 10,703 | ![]() | $ | 13,741 | ![]() | $ | 13,216 | ![]() | $ | 12,333 | ||||||
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On December 2, 2003, the Trustees voted to close the plan to new participants, eliminate the future benefits growth due to increases to compensation after July 31, 2003 and effective April 1, 2004, establish an unfunded deferred compensation plan which allows each independent trustee to defer payment of all, or a portion of the fees he or she receives for serving on the Board of Trustees throughout the year.
Morgan Stanley Trust, an affiliate of the Investment Manager and Distributor, is the Fund's transfer agent. At November 30, 2003, each of the Series had transfer agent fees and expenses payable as follows:
33
Morgan Stanley Multi-State Municipal Series Trust
Notes to Financial Statements November 30, 2003 continued
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![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||
Transfer Agent Fees and Expenses Payable | ![]() | $ | 703 | ![]() | $ | 432 | ![]() | $ | 406 | ![]() | $ | 429 | ||||||
![]() |
5. Expense Offset
The expense offset represents a reduction of the custodian fees for earnings on cash balances maintained by the Fund.
6. Risks Relating to Certain Financial Instruments
The Fund may invest a portion of its assets in inverse floating rate municipal obligations. The prices of these securities are subject to greater market fluctuations during periods of changing prevailing interest rates than are comparable fixed rate obligations.
To hedge against adverse interest rate changes, the Fund may invest in financial futures contracts or municipal bond index futures contracts ("futures contracts").
These futures contracts involve elements of market risk in excess of the amount reflected in the Statement of Assets and Liabilities. The Fund bears the risk of an unfavorable change in the value of the underlying securities. Risks may also arise upon entering into these contracts from the potential inability of the counterparties to meet the terms of their contracts.
7. Federal Income Tax Status
The amount of dividends and distributions from net investment income and net realized capital gains are determined in accordance with federal income tax regulations which may differ from generally accepted accounting principles. These "book/tax" differences are either considered temporary or permanent in nature. To the extent these differences are permanent in nature, such amounts are reclassified within the capital accounts based on their federal tax-basis treatment; temporary differences do not require reclassification. Dividends and distributions which exceed net investment income and net realized capital gains for tax purposes are reported as distributions of paid-in-capital.
As of November 30, 2003, the tax-basis components of accumulated earnings were as follows:
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![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||
Undistributed tax-exempt income | ![]() | $ | 22,004 | ![]() | $ | 29,804 | ![]() | $ | 29,604 | ![]() | $ | 25,949 | ||||||
Undistributed ordinary income | ![]() | 30,198 | ![]() | 14,110 | ![]() | — | ![]() | 20,450 | ||||||||||
Undistributed long-term gains | ![]() | 112,477 | ![]() | 189,700 | ![]() | 154,717 | ![]() | 186,804 | ||||||||||
Net accumulated earnings | ![]() | 164,679 | ![]() | 233,614 | ![]() | 184,321 | ![]() | 233,203 | ||||||||||
Temporary differences | ![]() | (16,012 | ) | ![]() | (21,273 | ) | ![]() | (21,432 | ) | ![]() | (18,186 | ) | ||||||
Net unrealized appreciation | ![]() | 1,563,940 | ![]() | 2,161,313 | ![]() | 1,590,324 | ![]() | 1,561,494 | ||||||||||
Total accumulated earnings | ![]() | $ | 1,712,607 | ![]() | $ | 2,373,654 | ![]() | $ | 1,753,213 | ![]() | $ | 1,776,511 | ||||||
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34
Morgan Stanley Multi-State Municipal Series Trust
Notes to Financial Statements November 30, 2003 continued
The tax character of distributions paid was as follows:
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![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
![]() | FOR THE YEAR ENDED NOVEMBER 30, 2003 | ![]() | FOR THE YEAR ENDED NOVEMBER 30, 2002 | |||||||
ARIZONA | ||||||||||
Tax-exempt income | ![]() | $ | 1,158,915 | ![]() | $ | 1,299,325 | ||||
Long-term capital gains | ![]() | 326,845 | ![]() | 66,842 | ||||||
Total distributions | ![]() | $ | 1,485,760 | ![]() | $ | 1,366,167 | ||||
FLORIDA | ||||||||||
Tax-exempt income | ![]() | $ | 1,647,600 | ![]() | $ | 1,888,011 | ||||
Long-term capital gains | ![]() | 694,053 | ![]() | 135,896 | ||||||
Total distributions | ![]() | $ | 2,341,653 | ![]() | $ | 2,023,907 | ||||
NEW JERSEY | ||||||||||
Tax-exempt income | ![]() | $ | 1,549,359 | ![]() | $ | 1,612,326 | ||||
Long-term capital gains | ![]() | 318,394 | ![]() | — | ||||||
Total distributions | ![]() | $ | 1,867,753 | ![]() | $ | 1,612,326 | ||||
PENNSYLVANIA | ||||||||||
Tax-exempt income | ![]() | $ | 1,476,757 | ![]() | $ | 1,571,649 | ||||
Long-term capital gains | ![]() | 254,759 | ![]() | — | ||||||
Total distributions | ![]() | $ | 1,731,516 | ![]() | $ | 1,571,649 | ||||
![]() |
At November 30, 2003, each Series had temporary book/tax differences primarily attributable to book amortization of discounts on debt securities, mark-to-market of open futures contracts and dividend payable and permanent book/tax differences attributable to tax adjustments on debt securities sold by the Series. To reflect reclassifications arising from the permanent differences, the following Series were (charged) credited:
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![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() | ![]() |
![]() | ACCUMULATED UNDISTRIBUTED NET INVESTMENT INCOME | ![]() | ACCUMULATED UNDISTRIBUTED NET REALIZED GAIN | |||||||
Arizona | ![]() | $ | (33 | ) | ![]() | $ | 33 | |||
Florida | ![]() | (14 | ) | ![]() | 14 | |||||
New Jersey | ![]() | (432 | ) | ![]() | 432 | |||||
Pennsylvania | ![]() | (50 | ) | ![]() | 50 | |||||
![]() |
35
Morgan Stanley Multi-State Municipal Series Trust
Notes to Financial Statements November 30, 2003 continued
8. Legal Matters
The Investment Manager, certain affiliates of the Investment Manager and certain investment companies advised by the Investment Manager or its affiliates, including the Fund, are named as defendants in a number of recently filed, similar class action complaints. These complaints generally allege that defendants, including the Fund, violated their statutory disclosure obligations and fiduciary duties by failing properly to disclose (i) that the Investment Manager and certain affiliates of the Investment Manager allegedly offered economic incentives to brokers and others to steer investors to the funds advised by the Investment Manager or its affiliates rather than funds managed by other companies, and (ii) that the funds advised by the Investment Manager or its affiliates, including the Fund, allegedly paid excessive commissions to brokers in return for their alleged efforts to steer investors to these funds. The complaints seek, among other things, unspecified compensatory damages, rescissionary damages, fees and costs. The defendants intend to move to dismiss these actions and otherwise vigorously to defend them. While the Fund believes that it has meritorious defenses, the ultimate outcome of these matters is not presently determinable at this early stage of the litigation, and no provision has been made in the Fund's financial statements for the effect, if any, of these matters.
36
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Morgan Stanley Multi-State Municipal Series Trust
Financial Highlights
Selected ratios and per share data for a share of beneficial interest outstanding throughout each period:
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YEAR ENDED NOVEMBER 30 | ![]() | NET ASSET VALUE BEGINNING OF PERIOD | ![]() | NET INVESTMENT INCOME | ![]() | NET REALIZED AND UNREALIZED GAIN (LOSS) | ![]() | TOTAL FROM INVESTMENT OPERATIONS | ![]() | DIVIDENDS TO SHAREHOLDERS | ![]() | DISTRIBUTIONS TO SHAREHOLDERS | ![]() | TOTAL DIVIDENDS AND DISTRIBUTIONS | ||||||||||||||||
ARIZONA SERIES | ![]() | |||||||||||||||||||||||||||||
1999 | ![]() | $ | 10.81 | ![]() | $ | 0.49 | ![]() | $ | (0.75 | ) | ![]() | $ | (0.26 | ) | ![]() | $ | (0.49 | ) | ![]() | $ | (0.16 | ) | ![]() | $ | (0.65 | ) | ||||
2000 | ![]() | 9.90 | ![]() | 0.49 | ![]() | 0.22 | ![]() | 0.71 | ![]() | (0.49 | ) | ![]() | — | ![]() | (0.49 | ) | ||||||||||||||
2001 | ![]() | 10.12 | ![]() | 0.47 | ![]() | 0.21 | ![]() | 0.68 | ![]() | (0.47 | ) | ![]() | — | ![]() | (0.47 | ) | ||||||||||||||
2002 | ![]() | 10.33 | ![]() | 0.44 | ![]() | 0.13 | ![]() | 0.57 | ![]() | (0.44 | ) | ![]() | (0.02 | ) | ![]() | (0.46 | ) | |||||||||||||
2003 | ![]() | 10.44 | ![]() | 0.41 | ![]() | 0.32 | ![]() | 0.73 | ![]() | (0.41 | ) | ![]() | (0.11 | ) | ![]() | (0.52 | ) | |||||||||||||
FLORIDA SERIES | ![]() | |||||||||||||||||||||||||||||
1999 | ![]() | 11.25 | ![]() | 0.50 | ![]() | (0.78 | ) | ![]() | (0.28 | ) | ![]() | (0.50 | ) | ![]() | (0.37 | ) | ![]() | (0.87 | ) | |||||||||||
2000 | ![]() | 10.10 | ![]() | 0.50 | ![]() | 0.25 | ![]() | 0.75 | ![]() | (0.50 | ) | ![]() | — | ![]() | (0.50 | ) | ||||||||||||||
2001 | ![]() | 10.35 | ![]() | 0.50 | ![]() | 0.24 | ![]() | 0.74 | ![]() | (0.50 | ) | ![]() | — | ![]() | (0.50 | ) | ||||||||||||||
2002 | ![]() | 10.59 | ![]() | 0.47 | ![]() | 0.09 | ![]() | 0.56 | ![]() | (0.47 | ) | ![]() | (0.03 | ) | ![]() | (0.50 | ) | |||||||||||||
2003 | ![]() | 10.65 | ![]() | 0.45 | ![]() | 0.26 | ![]() | 0.71 | ![]() | (0.46 | ) | ![]() | (0.19 | ) | ![]() | (0.65 | ) | |||||||||||||
NEW JERSEY SERIES | ![]() | |||||||||||||||||||||||||||||
1999 | ![]() | 11.15 | ![]() | 0.51 | ![]() | (0.77 | ) | ![]() | (0.26 | ) | ![]() | (0.51 | ) | ![]() | (0.16 | ) | ![]() | (0.67 | ) | |||||||||||
2000 | ![]() | 10.22 | ![]() | 0.50 | ![]() | 0.22 | ![]() | 0.72 | ![]() | (0.50 | ) | ![]() | — | ![]() | (0.50 | ) | ||||||||||||||
2001 | ![]() | 10.44 | ![]() | 0.50 | ![]() | 0.23 | ![]() | 0.73 | ![]() | (0.50 | ) | ![]() | — | ![]() | (0.50 | ) | ||||||||||||||
2002 | ![]() | 10.67 | ![]() | 0.49 | ![]() | 0.08 | ![]() | 0.57 | ![]() | (0.49 | ) | ![]() | — | ![]() | (0.49 | ) | ||||||||||||||
2003 | ![]() | 10.75 | ![]() | 0.47 | ![]() | 0.18 | ![]() | 0.65 | ![]() | (0.47 | ) | ![]() | (0.10 | ) | ![]() | (0.57 | ) | |||||||||||||
PENNSYLVANIA SERIES | ![]() | |||||||||||||||||||||||||||||
1999 | ![]() | 11.15 | ![]() | 0.52 | ![]() | (0.84 | ) | ![]() | (0.32 | ) | ![]() | (0.52 | ) | ![]() | (0.12 | ) | ![]() | (0.64 | ) | |||||||||||
2000 | ![]() | 10.19 | ![]() | 0.52 | ![]() | 0.27 | ![]() | 0.79 | ![]() | (0.52 | ) | ![]() | — | ![]() | (0.52 | ) | ||||||||||||||
2001 | ![]() | 10.46 | ![]() | 0.54 | ![]() | 0.30 | ![]() | 0.84 | ![]() | (0.54) | ‡ | ![]() | — | ![]() | (0.54 | ) | ||||||||||||||
2002 | ![]() | 10.76 | ![]() | 0.51 | ![]() | 0.00 | ![]() | 0.51 | ![]() | (0.51 | ) | ![]() | — | ![]() | (0.51 | ) | ||||||||||||||
2003 | ![]() | 10.76 | ![]() | 0.47 | ![]() | 0.29 | ![]() | 0.76 | ![]() | (0.47 | ) | ![]() | (0.08 | ) | ![]() | (0.55 | ) | |||||||||||||
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![]() | † | Does not reflect the deduction of sales charge. Calculated based on the net asset value as of the last business day of the period. |
![]() | ‡ | Includes capital gain distribution of $0.0029. |
![]() | (1) | Does not reflect the effect of expense offset of 0.01%. |
See Notes to Financial Statements
38
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![]() | RATIOS TO AVERAGE NET ASSETS | ![]() | ||||||||||||||||||||
NET ASSET VALUE END OF PERIOD | ![]() | TOTAL RETURN† | ![]() | NET ASSETS END OF PERIOD (000'S) | ![]() | EXPENSES (BEFORE EXPENSE OFFSET) | ![]() | NET INVESTMENT INCOME | ![]() | PORTFOLIO TURNOVER RATE | ||||||||||||
$9.90 | ![]() | (2.53 | )% | ![]() | $ | 36,867 | ![]() | 0.66 | %(1) | ![]() | 4.72 | % | ![]() | 13 | % | |||||||
10.12 | ![]() | 7.42 | ![]() | 32,329 | ![]() | 0.67 | (1) | ![]() | 4.93 | ![]() | 10 | |||||||||||
10.33 | ![]() | 6.82 | ![]() | 31,722 | ![]() | 0.71 | (1) | ![]() | 4.54 | ![]() | 30 | |||||||||||
10.44 | ![]() | 5.64 | ![]() | 30,247 | ![]() | 0.70 | (1) | ![]() | 4.23 | ![]() | 29 | |||||||||||
10.65 | ![]() | 7.23 | ![]() | 28,509 | ![]() | 0.73 | (1) | ![]() | 3.94 | ![]() | 12 | |||||||||||
10.10 | ![]() | (2.70 | ) | ![]() | 53,555 | ![]() | 0.64 | (1) | ![]() | 4.69 | ![]() | 13 | ||||||||||
10.35 | ![]() | 7.70 | ![]() | 47,951 | ![]() | 0.63 | (1) | ![]() | 4.95 | ![]() | 4 | |||||||||||
10.59 | ![]() | 7.23 | ![]() | 44,211 | ![]() | 0.65 | (1) | ![]() | 4.69 | ![]() | 16 | |||||||||||
10.65 | ![]() | 5.44 | ![]() | 40,627 | ![]() | 0.66 | (1) | ![]() | 4.45 | ![]() | 22 | |||||||||||
10.71 | ![]() | 6.84 | ![]() | 37,623 | ![]() | 0.68 | (1) | ![]() | 4.17 | ![]() | 8 | |||||||||||
10.22 | ![]() | (2.44 | ) | ![]() | 38,566 | ![]() | 0.69 | ![]() | 4.73 | ![]() | 10 | |||||||||||
10.44 | ![]() | 7.32 | ![]() | 36,306 | ![]() | 0.69 | (1) | ![]() | 4.90 | ![]() | 20 | |||||||||||
10.67 | ![]() | 7.07 | ![]() | 36,757 | ![]() | 0.69 | ![]() | 4.65 | ![]() | 9 | ||||||||||||
10.75 | ![]() | 5.41 | ![]() | 35,884 | ![]() | 0.70 | (1) | ![]() | 4.55 | ![]() | 14 | |||||||||||
10.83 | ![]() | 6.10 | ![]() | 34,371 | ![]() | 0.71 | (1) | ![]() | 4.32 | ![]() | 25 | |||||||||||
10.19 | ![]() | (3.02 | ) | ![]() | 49,059 | ![]() | 0.64 | (1) | ![]() | 4.83 | ![]() | 6 | ||||||||||
10.46 | ![]() | 8.03 | ![]() | 52,041 | ![]() | 0.64 | (1) | ![]() | 5.07 | ![]() | 6 | |||||||||||
10.76 | ![]() | 8.19 | ![]() | 35,514 | ![]() | 0.68 | (1) | ![]() | 5.05 | ![]() | 11 | |||||||||||
10.76 | ![]() | 4.83 | ![]() | 33,022 | ![]() | 0.71 | (1) | ![]() | 4.74 | ![]() | 21 | |||||||||||
10.97 | ![]() | 7.27 | ![]() | 34,238 | ![]() | 0.68 | (1) | ![]() | 4.34 | ![]() | 27 | |||||||||||
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39
Morgan Stanley Multi-State Municipal Series Trust
Independent Auditors' Report
To the Shareholders and Board of Trustees of
Morgan Stanley Multi-State Municipal Series Trust:
We have audited the accompanying statement of assets and liabilities, including the portfolio of investments, of Morgan Stanley Multi-State Municipal Series Trust (the "Fund"), comprising the Arizona Series, Florida Series, New Jersey Series and Pennsylvania Series, as of November 30, 2003, and the related statements of operations for the year then ended and changes in 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. These financial statements and financial highlights are the responsibility of the Fund's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of November 30, 2003, by correspondence with the custodian and broker. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of each of the Series constituting the Morgan Stanley Multi-State Municipal Series Trust as of November 30, 2003, the results of their operations for the year then ended, the changes in their 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.
Deloitte & Touche LLP
New York, New York
January 16, 2004
2003 Federal Tax Notice (unaudited)
During the year ended November 30, 2003, each Series paid to its shareholders the following per share amounts:
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![]() | ARIZONA | ![]() | FLORIDA | ![]() | NEW JERSEY | ![]() | PENNSYLVANIA | |||||||||||||
Tax-exempt income | ![]() | $ | 0.41 | ![]() | $ | 0.46 | ![]() | $ | 0.47 | ![]() | $ | 0.47 | ||||||||
Long-term capital gains | ![]() | $ | 0.11 | ![]() | $ | 0.19 | ![]() | $ | 0.10 | ![]() | $ | 0.08 | ||||||||
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40
Morgan Stanley Multi-State Municipal Series Trust
Trustee and Officer Information
Independent Trustees:
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Name, Age and Address of Independent Trustee | ![]() | Position(s) Held with Registrant | ![]() | Term of Office and Length of Time Served* | ![]() | Principal Occupation(s) During Past 5 Years** | ![]() | Number of Portfolios in Fund Complex Overseen by Trustee*** | ![]() | Other Directorships Held by Trustee | ||||||||||||
Michael Bozic (62) c/o Mayer, Brown, Rowe & Maw LLP Counsel to the Independent Directors 1675 Broadway New York, NY | ![]() | Trustee | ![]() | Since April 1994 | ![]() | Retired; Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since April 1994) and the Institutional Funds (since July 2003); formerly Vice Chairman of Kmart Corporation (December 1998-October 2000), Chairman and Chief Executive Officer of Levitz Furniture Corporation (November 1995-November 1998) and President and Chief Executive Officer of Hills Department Stores (May 1991-July 1995); formerly variously Chairman, Chief Executive Officer, President and Chief Operating Officer (1987-1991) of the Sears Merchandise Group of Sears, Roebuck & Co. | ![]() | 216 | ![]() | Director of Weirton Steel Corporation. | ||||||||||||
Edwin J. Garn (71) c/o Summit Ventures LLC 1 Utah Center 201 S. Main Street Salt Lake City, UT | ![]() | Trustee | ![]() | Since January 1993 | ![]() | Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since January 1993) and the Institutional Funds (since July 2003); member of the Utah Regional Advisory Board of Pacific Corp.; formerly United States Senator (R-Utah) (1974-1992) and Chairman, Senate Banking Committee (1980-1986), Mayor of Salt Lake City, Utah (1971-1974), Astronaut, Space Shuttle Discovery (April 12-19, 1985), and Vice Chairman, Huntsman Corporation (chemical company). | ![]() | 216 | ![]() | Director of Franklin Covey (time management systems), BMW Bank of North America, Inc. (industrial loan corporation), United Space Alliance (joint venture between Lockheed Martin and the Boeing Company) and Nuskin Asia Pacific (multilevel marketing); member of the board of various civic and charitable organizations. | ||||||||||||
Wayne E. Hedien (69) c/o Mayer, Brown, Rowe & Maw LLP Counsel to the Independent Directors 1675 Broadway New York, NY | ![]() | Trustee | ![]() | Since September 1997 | ![]() | Retired; Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003; (Since September 1997) and the Institutional Funds (since July 2003); formerly associated with the Allstate Companies (1966-1994), most recently as Chairman of The Allstate Corporation (March 1993-December 1994) and Chairman and Chief Executive Officer of its wholly-owned subsidiary, Allstate Insurance Company (July 1989-December 1994). | ![]() | 216 | ![]() | Director of The PMI Group Inc. (private mortgage insurance); Trustee and Vice Chairman of The Field Museum of Natural History; director of various other business and charitable organizations. | ||||||||||||
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41
Morgan Stanley Multi-State Municipal Series Trust
Trustee and Officer Information continued
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Name, Age and Address of Independent Trustee | ![]() | Position(s) Held with Registrant | ![]() | Term of Office and Length of Time Served* | ![]() | Principal Occupation(s) During Past 5 Years** | ![]() | Number of Portfolios in Fund Complex Overseen by Trustee*** | ![]() | Other Directorships Held by Trustee | ||||||||||||
Dr. Manuel H. Johnson (54) c/o Johnson Smick International, Inc. 2099 Pennsylvania Avenue, N.W. Suite 950 Washington, D.C. | ![]() | Trustee | ![]() | Since July 1991 | ![]() | Chairman of the Audit Committee and Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since July 1991) and the Institutional Funds (since July 2003); Senior Partner, Johnson Smick International, Inc., a consulting firm; Co-Chairman and a founder of the Group of Seven Council (G7C), an international economic commission; formerly Vice Chairman of the Board of Governors of the Federal Reserve System and Assistant Secretary of the U.S. Treasury. | ![]() | 216 | ![]() | Director of NVR, Inc. (home construction); Chairman and Trustee of the Financial Accounting Foundation (oversight organization of the Financial Accounting Standards Board); Director of RBS Greenwich Capital Holdings (financial holding company). | ||||||||||||
Joseph J. Kearns (61) PMB754 23852 Pacific Coast Highway Malibu, CA | ![]() | Trustee | ![]() | Since July 2003 | ![]() | Deputy Chairman of the Audit Committee and Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since July 2003) and the Institutional Funds (since August 1994); previously Chairman of the Audit Committee of the Institutional Funds (October 2001-July 2003); President, Kearns & Associates LLC (investment consulting); formerly CFO of the J. Paul Getty Trust. | ![]() | 217 | ![]() | Director of Electro Rent Corporation (equipment leasing), The Ford Family Foundation, and the UCLA Foundation. | ||||||||||||
Michael E. Nugent (67) c/o Triumph Capital, L.P. 445 Park Avenue New York, NY | ![]() | Trustee | ![]() | Since July 1991 | ![]() | Chairman of the Insurance Committee and Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since July 1991) and the Institutional Funds (since July 2001); General Partner of Triumph Capital, L.P., a private investment partnership; formerly Vice President, Bankers Trust Company and BT Capital Corporation (1984-1988). | ![]() | 216 | ![]() | Director of various business organizations. | ||||||||||||
Fergus Reid (71) 85 Charles Colman Blvd. Pawling, NY | ![]() | Trustee | ![]() | Since July 2003 | ![]() | Chairman of the Governance Committee and Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since July 2003) and the Institutional Funds (since June 1992); Chairman of Lumelite Plastics Corporation. | ![]() | 217 | ![]() | Trustee and Director of certain investment companies in the JPMorgan Funds complex managed by JP Morgan Investment Management Inc. | ||||||||||||
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42
Morgan Stanley Multi-State Municipal Series Trust
Trustee and Officer Information continued
Interested Trustees:
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Name, Age and Address of Interested Trustee | ![]() | Position(s) Held with Registrant | ![]() | Term of Office and Length of Time Served* | ![]() | Principal Occupation(s) During Past 5 Years** | ![]() | Number of Portfolios in Fund Complex Overseen by Trustee*** | ![]() | Other Directorships Held by Trustee | ||||||||||||
Charles A. Fiumefreddo (70) c/o Morgan Stanley Trust Harborside Financial Center, Plaza Two, Jersey City, NJ | ![]() | Chairman of the Board and Trustee | ![]() | Since July 1991 | ![]() | Chairman and Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since July 1991) and the Institutional Funds (since July 2003); formerly Chief Executive Officer of the Retail Funds and the TCW/DW Term Trust 2003 (until September 2002). | ![]() | 216 | ![]() | None | ||||||||||||
James F. Higgins (55) c/o Morgan Stanley Trust Harborside Financial Center, Plaza Two, Jersey City, NJ | ![]() | Trustee | ![]() | Since June 2000 | ![]() | Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since June 2000) and the Institutional Funds (since July 2003); Senior Advisor of Morgan Stanley (since August 2000); Director of the Distributor and Dean Witter Realty Inc.; previously President and Chief Operating Officer of the Private Client Group of Morgan Stanley (May 1999-August 2000), and President and Chief Operating Officer of Individual Securities of Morgan Stanley (February 1997-May 1999). | ![]() | 216 | ![]() | Director of AXA Financial, Inc. and The Equitable Life Assurance Society of the United States (financial services). | ||||||||||||
Philip J. Purcell (60) 1585 Broadway New York, NY | ![]() | Trustee | ![]() | Since April 1994 | ![]() | Director or Trustee of the Retail Funds and TCW/DW Term Trust 2003 (since April 1994) and the Institutional Funds (since July 2003); Chairman of the Board of Directors and Chief Executive Officer of Morgan Stanley and Morgan Stanley DW Inc.; Director of the Distributor; Chairman of the Board of Directors and Chief Executive Officer of Novus Credit Services Inc.; Director and/or officer of various Morgan Stanley subsidiaries. | ![]() | 216 | ![]() | Director of American Airlines, Inc. and its parent company, AMR Corporation. | ||||||||||||
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![]() | * | This is the earliest date the Trustee began serving the funds advised by Morgan Stanley Investment Advisors Inc. (the "Investment Manager") (the "Retail Funds"). |
![]() | ** | The dates referenced below indicating commencement of services as Director/Trustee for the Retail Funds and the funds advised by Morgan Stanley Investment Management Inc., Morgan Stanley Investments LP and Morgan Stanley AIP GP LP (the "Institutional Funds") reflect the earliest date the Director/Trustee began serving the Retail or Institutional Funds as applicable. |
![]() | *** | The Fund Complex includes all open-end and closed-end funds (including all of their portfolios) advised by the Investment Manager and any funds that have an investment advisor that is an affiliated person of the Investment Manager (including but not limited to Morgan Stanley Investment Management Inc. and Morgan Stanley Investments LP). |
43
Morgan Stanley Multi-State Municipal Series Trust
Trustee and Officer Information continued
Officers:
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Name, Age and Address of Executive Officer | ![]() | Position(s) Held with Registrant | ![]() | Term of Office and Length of Time Served* | ![]() | Principal Occupation(s) During Past 5 Years** | ||||||||
Mitchell M. Merin (50) 1221 Avenue of the Americas New York, NY | ![]() | President | ![]() | Since May 1999 | ![]() | President and Chief Operating Officer of Morgan Stanley Investment Management Inc.; President, Director and Chief Executive Officer of the Investment Manager and Morgan Stanley Services; Chairman, Chief Executive Officer and Director of the Distributor; Chairman and Director of the Transfer Agent; Director of various Morgan Stanley subsidiaries; President Morgan Stanley Investments LP (since February 2003); President of the Institutional Funds (since July 2003) and President of the Retail Funds and TCW/DW Term Trust 2003 (since May 1999); Trustee (since July 2003) and President (since December 2002) of the Van Kampen Closed-End Funds; Trustee (since May 1999) and President (since October 2002) of the Van Kampen Open-End Funds. | ||||||||
Ronald E. Robison (64) 1221 Avenue of the Americas New York, NY | ![]() | Executive Vice President and Principal Executive Officer | ![]() | Since April 2003 | ![]() | Chief Global Operations Officer and Managing Director of Morgan Stanley Investment Management Inc.; Managing Director of Morgan Stanley & Co. Incorporated; Managing Director of Morgan Stanley; Managing Director, Chief Administrative Officer and Director of the Investment Manager and Morgan Stanley Services; Chief Executive Officer and Director of the Transfer Agent; Executive Vice President and Principal Executive Officer of the Institutional Funds (since July 2003); and the TCW/DW Term Trust 2003 (since April 2003); previously President of the Institutional Funds (March 2001-July 2003) and Director of the Institutional Funds (March 2001-July 2003). | ||||||||
Barry Fink (48) 1221 Avenue of the Americas New York, NY | ![]() | Vice President and General Counsel | ![]() | Since February 1997 | ![]() | General Counsel (since May 2000) and Managing Director (since December 2000) of Morgan Stanley Investment Management; Managing Director (since December 2000), Secretary (since February 1997) and Director (since July 1998) of the Investment Manager and Morgan Stanley Services; Assistant Secretary of Morgan Stanley DW; Chief Legal Officer of Morgan Stanley Investments LP (since July 2002); Vice President of the Institutional Funds (since July 2003); Vice President and Secretary of the Distributor; previously Secretary of the Retail Funds (February 1997-July 2003); previously Vice President and Assistant General Counsel of the Investment Manager and Morgan Stanley Services (February 1997-December 2001). | ||||||||
Joseph J. McAlinden (60) 1221 Avenue of the Americas New York, NY | ![]() | Vice President | ![]() | Since July 1995 | ![]() | Managing Director and Chief Investment Officer of the Investment Manager, Morgan Stanley Investment Management Inc. and Morgan Stanley Investments LP; Director of the Transfer Agent, Chief Investment Officer of the Van Kampen Funds; Vice President of the Institutional Funds (since July 2003) and the Retail Funds (since July 1995). | ||||||||
Stefanie V. Chang (37) 1221 Avenue of the Americas New York, NY | ![]() | Vice President | ![]() | Since July 2003 | ![]() | Executive Director of Morgan Stanley & Co. and Morgan Stanley Investment Management Inc. and Vice President of the Institutional Funds (since December 1997) and the Retail Funds (since July 2003); formerly practiced law with the New York law firm of Rogers & Wells (now Clifford Chance LLP). | ||||||||
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44
Morgan Stanley Multi-State Municipal Series Trust
Trustee and Officer Information continued
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Name, Age and Address of Executive Officer | ![]() | Position(s) Held with Registrant | ![]() | Term of Office and Length of Time Served* | ![]() | Principal Occupation(s) During Past 5 Years** | ||||||||
Francis J. Smith (38) c/o Morgan Stanley Trust Harborside Financial Center, Plaza Two, Jersey City, NJ | ![]() | Treasurer and Chief Financial Officer | ![]() | Treasurer since July 2003 and Chief Financial Officer since September 2002 | ![]() | Executive Director of the Investment Manager and Morgan Stanley Services (since December 2001); previously Vice President of the Retail Funds (September 2002-July 2003); previously Vice President of the Investment Manager and Morgan Stanley Services (August 2000-November 2001) and Senior Manager at PricewaterhouseCoopers LLP (January 1998-August 2000). | ||||||||
Thomas F. Caloia (57) c/o Morgan Stanley Trust Harborside Financial Center, Plaza Two, Jersey City, NJ | ![]() | Vice President | ![]() | Since July 2003 | ![]() | Executive Director (since December 2002) and Assistant Treasurer of the Investment Manager, the Distributor and Morgan Stanley Services; previously Treasurer of the Retail Funds (April 1989-July 2003); formerly First Vice President of the Investment Manager, the Distributor and Morgan Stanley Services. | ||||||||
Mary E. Mullin (36) 1221 Avenue of the Americas New York, NY | ![]() | Secretary | ![]() | Since July 2003 | ![]() | Vice President of Morgan Stanley & Co. Incorporated and Morgan Stanley Investment Management Inc.; Secretary of the Institutional Funds (since June 1999) and the Retail Funds (since July 2003); formerly practiced law with the New York law firms of McDermott, Will & Emery and Skadden, Arps, Slate, Meagher & Flom LLP. | ||||||||
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![]() | * | This is the earliest date the Officer began serving the Retail Funds. Each Officer serves an indefinite term, until his or her successor is elected. |
![]() | ** | The dates referenced below indicating commencement of service as an Officer for the Retail and Institutional Funds reflect the earliest date the Officer began serving the Retail or Institutional Funds as applicable. |
45
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Trustees Michael Bozic Officers Charles A. Fiumefreddo Mitchell M. Merin Ronald E. Robison Barry Fink Joseph J. McAlinden Stefanie V. Chang Francis J. Smith Thomas F. Caloia Mary E. Mullin Transfer Agent Morgan Stanley Trust Independent Auditors Deloitte & Touche LLP Investment Manager Morgan Stanley Investment Advisors Inc. This report is submitted for the general information of the shareholders of the Fund. For more detailed information about the Fund, its fees and expenses and other pertinent information, please read its Prospectus. The Fund's Statement of Additional Information contains additional information about the Fund, including its trustees. It is available, without charge, by calling (800) 869-NEWS. This report is not authorized for distribution to prospective investors in the Fund unless preceded or accompanied by an effective Prospectus. Read the Prospectus carefully before investing. Investments and services offered through Morgan Stanley DW Inc., member SIPC Morgan Stanley Funds are distributed by Morgan Stanley Distributors Inc. Morgan Stanley Distributors Inc., member NASD. © 2003 Morgan Stanley ![]() 37925RPT-00-13315A04-OP-1/04 | ![]() | MORGAN STANLEY FUNDS |
Morgan Stanley Multi-State Municipal Series Trust Annual Report November 30, 2003 | ||
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Item 2. Code of Ethics. (a) The Fund has adopted a code of ethics (the "Code of Ethics") that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Fund or a third party. (b) No information need be disclosed pursuant to this paragraph. (c) Not applicable. (d) Not applicable. (e) Not applicable. (f) (1) The Fund's Code of Ethics is attached hereto as Exhibit A. (2) Not applicable. (3) Not applicable. Item 3. Audit Committee Financial Expert. The Fund's Board of Trustees has determined that it has two "audit committee financial experts" serving on its audit committee, each of whom are "independent" Trustees: Dr. Manuel H. Johnson and Joseph J. Kearns. Under applicable securities laws, a person who is determined to be an audit committee financial expert will not be deemed an "expert" for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities that are greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and Board of Trustees in the absence of such designation or identification. Item 4. Principal Accountant Fees and Services Applicable only for reports covering fiscal years ending on or after December 15, 2003. Item 5. Audit Committee of Listed Registrants. Applicable only for reports covering periods ending on or after the earlier of (i) the first annual shareholder meeting after January 15, 2004 or (ii) October 31, 2004. Item 6. [Reserved.] Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. Applicable only to annual reports filed by closed-end funds. Item 8. [Reserved.] Item 9 - Controls and Procedures (a) The Fund's principal executive officer and principal financial officer have concluded that the Fund's disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Fund in this Form N-CSR was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, based upon such officers' evaluation of these controls and procedures as of a date within 90 days of the filing date of the report. There were no significant changes or corrective actions with regard to significant deficiencies or material weaknesses in the Fund's internal controls or in other factors that could significantly affect the Fund's internal controls subsequent to the date of their evaluation. (b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 10 Exhibits (a) The Code of Ethics for Principal Executive and Senior Financial Officers is attached hereto. (b) A separate certification for each principal executive officer and principal financial officer of the registrant are attached hereto as part of EX-99.CERT. 2 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. Morgan Stanley Multi-States Municipal Series Trust /s/ Ronald E. Robison Ronald E. Robison Principal Executive Officer January 22, 2004 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated. /s/ Ronald E. Robison Ronald E. Robison Principal Executive Officer January 22, 2004 /s/ Francis Smith Francis Smith Principal Financial Officer January 22, 2004 3 EXHIBIT 10 A CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS ADOPTED JULY 31, 2003 I. This Code of Ethics (the "Code") for the investment companies within the Morgan Stanley complex identified in Exhibit A (collectively, "Funds" and each, a "Fund") applies to each Fund's Principal Executive Officer, President, Principal Financial Officer and Treasurer (or persons performing similar functions) ("Covered Officers" each of whom are set forth in Exhibit B) for the purpose of promoting: o honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships. o full, fair, accurate, timely and understandable disclosure in reports and documents that a company files with, or submits to, the Securities and Exchange Commission ("SEC") and in other public communications made by the Fund; o compliance with applicable laws and governmental rules and regulations; o prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and o accountability for adherence to the Code. Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest. Any question about the application of the Code should be referred to the General Counsel or his/her designee (who is set forth in Exhibit C). II. COVERED OFFICERS SHOULD HANDLE ETHICALLY ACTUAL AND APPARENT CONFLICTS OF INTEREST OVERVIEW. A "conflict of interest" occurs when a Covered Officer's private interest interferes, or appears to interfere, with the interests of, or his service to, the Fund. For example, a conflict of interest would arise if a Covered Officer, or a member of his family, receives improper personal benefits as a result of his position with the Fund. Certain conflicts of interest arise out of the relationships between Covered Officers and the Fund and already are subject to conflict of interest provisions in the Investment Company Act of 1940 ("Investment Company Act") and the Investment Advisers Act of 1940 ("Investment Advisers Act"). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities 4 or other property) with the Fund because of their status as "affiliated persons" (as defined in the Investment Company Act) of the Fund. The Fund's and its investment adviser's compliance programs and procedures are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside the parameters of this Code, unless or until the General Counsel determines that any violation of such programs and procedures is also a violation of this Code. Although typically not presenting an opportunity for improper personal benefit, conflicts may arise from, or as a result of, the contractual relationship between the Fund and its investment adviser of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the Fund or for the investment adviser, or for both), be involved in establishing policies and implementing decisions that will have different effects on the Fund and its investment adviser. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Fund and the investment adviser and is consistent with the performance by the Covered Officers of their duties as officers of the Fund. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the Funds' Boards of Directors/Trustees ("Boards") that the Covered Officers may also be officers or employees of one or more other investment companies covered by this or other codes. Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the Fund. Each Covered Officer must not: o use his personal influence or personal relationships improperly to influence investment decisions or financial reporting by the Fund whereby the Covered Officer would benefit personally (directly or indirectly) to the detriment of the Fund; o cause the Fund to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit of the Fund; or o use material non-public knowledge of portfolio transactions made or contemplated for, or actions proposed to be taken by, the Fund to trade personally or cause others to trade personally in contemplation of the market effect of such transactions. 5 Each Covered Officer must, at the time of signing this Code, report to the General Counsel all affiliations or significant business relationships outside the Morgan Stanley complex and must update the report annually. Conflict of interest situations should always be approved by the General Counsel and communicated to the relevant Fund or Fund's Board. Any activity or relationship that would present such a conflict for a Covered Officer would likely also present a conflict for the Covered Officer if an immediate member of the Covered Officer's family living in the same household engages in such an activity or has such a relationship. Examples of these include: o service or significant business relationships as a director on the board of any public or private company; o accepting directly or indirectly, anything of value, including gifts and gratuities in excess of $100 per year from any person or entity with which the Fund has current or prospective business dealings, not including occasional meals or tickets for theatre or sporting events or other similar entertainment; provided it is business-related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety; o any ownership interest in, or any consulting or employment relationship with, any of the Fund's service providers, other than its investment adviser, principal underwriter, or any affiliated person thereof; and o a direct or indirect financial interest in commissions, transaction charges or spreads paid by the Fund for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity ownership. III. DISCLOSURE AND COMPLIANCE o Each Covered Officer should familiarize himself/herself with the disclosure and compliance requirements generally applicable to the Funds; o each Covered Officer must not knowingly misrepresent, or cause others to misrepresent, facts about the Fund to others, whether within or outside the Fund, including to the Fund's Directors/Trustees and auditors, or to governmental regulators and self-regulatory organizations; o each Covered Officer should, to the extent appropriate within his area of responsibility, consult with other officers and employees of the Funds and their investment advisers with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the Funds file with, or submit to, the SEC and in other public communications made by the Funds; and 6 o it is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations. IV. REPORTING AND ACCOUNTABILITY Each Covered Officer must: o upon adoption of the Code (thereafter as applicable, upon becoming a Covered Officer), affirm in writing to the Boards that he has received, read and understands the Code; o annually thereafter affirm to the Boards that he has complied with the requirements of the Code; o not retaliate against any other Covered Officer, other officer or any employee of the Funds or their affiliated persons for reports of potential violations that are made in good faith; and o notify the General Counsel promptly if he/she knows or suspects of any violation of this Code. Failure to do so is itself a violation of this Code. The General Counsel is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation. However, any waivers(1) sought by a Covered Officer must be considered by the Board of the relevant Fund or Funds. The Funds will follow these procedures in investigating and enforcing this Code: o the General Counsel will take all appropriate action to investigate any potential violations reported to him; o if, after such investigation, the General Counsel believes that no violation has occurred, the General Counsel is not required to take any further action; o any matter that the General Counsel believes is a violation will be reported to the relevant Fund's Audit Committee; o if the directors/trustees/managing general partners who are not "interested persons" as defined by the Investment Company Act (the "Independent Directors/Trustees/Managing General Partners") of the relevant Fund concur that a violation has occurred, they will consider appropriate action, which may include review of, and appropriate modifications to, applicable - --------------------- (1) Item 2 of Form N-CSR defines "waiver" as "the approval by the registrant of a material departure from a provision of the code of ethics." 7 policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a recommendation to dismiss the Covered Officer or other appropriate disciplinary actions; o the Independent Directors/Trustees/Managing General Partners of the relevant Fund will be responsible for granting waivers of this Code, as appropriate; and o any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules. V. OTHER POLICIES AND PROCEDURES This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act of 2002 and the rules and forms applicable to registered investment companies thereunder. Insofar as other policies or procedures of the Funds, the Funds' investment advisers, principal underwriters, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with the provisions of this Code unless any provision of this Code conflicts with any applicable federal or state law, in which case the requirements of such law will govern. The Funds' and their investment advisers' and principal underwriters' codes of ethics under Rule 17j-1 under the Investment Company Act and Morgan Stanley's Code of Ethics are separate requirements applying to the Covered Officers and others, and are not part of this Code. VI. AMENDMENTS Any amendments to this Code, other than amendments to Exhibits A, B or C, must be approved or ratified by a majority vote of the Board of each Fund, including a majority of Independent Directors/Trustees/Managing General Partners. VII. CONFIDENTIALITY All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Independent Directors/Trustees/Managing General Partners of the relevant Fund or Funds and their counsel, the relevant Fund or Funds and their counsel and the relevant investment adviser and its counsel. 8 VIII. INTERNAL USE The Code is intended solely for the internal use by the Funds and does not constitute an admission, by or on behalf of any Fund, as to any fact, circumstance, or legal conclusion I have read and understand the terms of the above Code. I recognize the responsibilities and obligations incurred by me as a result of my being subject to the Code. I hereby agree to abide by the above Code. - ------------------------------- Date:__________________________ 9 EXHIBIT B INSTITUTIONAL FUNDS COVERED OFFICERS Mitchell M. Merin - President Ronald E. Robison - Executive Vice President and Principal Executive Officer James W. Garrett - Chief Financial Officer and Treasurer RETAIL FUNDS COVERED OFFICERS Mitchell M. Merin - President Ronald E. Robison - Executive Vice President and Principal Executive Officer Frank Smith - Chief Financial Officer and Treasurer 10 EXHIBIT C GENERAL COUNSEL Barry Fink 11 EXHIBIT 10 B1 CERTIFICATION OF PRINCIPAL EXECUTIVE OFFICER CERTIFICATIONS I, Ronald E. Robison, certify that: 1. I have reviewed this report on Form N-CSR of Morgan Stanley Multi-States Municipal Series Trust; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; [b) Omitted.] c) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and d) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and 12 b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting. Date: January 22, 2004 /s/ Ronald E. Robison Ronald E. Robison Principal Executive Officer 13 EXHIBIT 10 B2 CERTIFICATION OF PRINCIPAL FINANCIAL OFFICER CERTIFICATIONS I, Francis Smith, certify that: 6. I have reviewed this report on Form N-CSR of Morgan Stanley Multi-States Municipal Series Trust; 7. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 8. Based on my knowledge, the financial statements and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 9. The registrant's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: b) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; [b) Omitted.] e) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and f) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 10. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): c) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and 14 d) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting. Date: January 22, 2004 /s/ Francis Smith Francis Smith Principal Financial Officer 15 SECTION 906 CERTIFICATION Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Morgan Stanley Multi-States Municipal Series Trust In connection with the Report on Form N-CSR (the "Report") of the above-named issuer for the period ended November 30, 2003 that is accompanied by this certification, the undersigned hereby certifies that: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Issuer. Date: January 22, 2004 /s/ Ronald E. Robison --------------------------- Ronald E. Robison Principal Executive Officer A signed original of this written statement required by Section 906 has been provided to Morgan Stanley Multi-States Municipal Series Trust and will be retained by Morgan Stanley Multi-States Municipal Series Trust and furnished to the Securities and Exchange Commission or its staff upon request. 16 SECTION 906 CERTIFICATION Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Morgan Stanley Multi-States Municipal Series Trust In connection with the Report on Form N-CSR (the "Report") of the above-named issuer for the period ended November 30, 2003 that is accompanied by this certification, the undersigned hereby certifies that: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Issuer. Date: January 22, 2004 /s/ Francis Smith ----------------------------- Francis Smith Principal Financial Officer A signed original of this written statement required by Section 906 has been provided to Morgan Stanley Multi-States Municipal Series Trust and will be retained by Morgan Stanley Multi-States Municipal Series Trust and furnished to the Securities and Exchange Commission or its staff upon request. 17