File Nos. 33-4382 & 811-4626

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the
Securities Exchange Act of 1934
(Amendment No. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-12

THE CASCADES TRUST
(Exact Name of Registrant as Specified in Charter)

380 Madison Avenue, Suite 2300
New York, New York 10017
(Address of Principal Executive Offices)

(212) 697-6666
(Registrant's Telephone Number)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required

<page>

Important Notice
Please Read Immediately

Aquilasm
Group of Funds

Tax-Free Trust of Oregon
380 Madison Avenue, Suite 2300, New York, NY 10017

Notice of Annual Meeting of
Shareholders to Be Held
on May 3, 2004

To Shareholders of the Trust:

The purpose of this Notice is to advise you that an Annual Meeting of the
Shareholders of Tax-Free Trust of Oregon (the "Trust"), the only series of the
Cascades Trust, will be held:

Place: (a) at the Oregon Convention Center
777 NE Martin Luther King, Jr. Blvd.
Portland, Oregon;

Time: (b) on Monday, May 3, 2004
at 2:00 p.m. Pacific Daylight Time;

Purposes: (c) for the following purposes:

(i) to elect ten Trustees; each Trustee elected will hold
office until the next annual meeting of the Trust's
shareholders or until his or her successor is duly
elected (Proposal No. 1);

(ii) to ratify (that is, to approve) or reject the selection
of KPMG LLP as the Trust's independent auditors for the
fiscal year ending September 30, 2004 (Proposal No. 2);

(iii) to act upon any other matters which may properly come
before the Meeting at the scheduled time and place or
any adjourned meeting or meetings.

Who Can Vote
What Shares:(d) To vote at the Meeting, you must have been a shareholder on
the Trust's records at the close of business on February 5,
2004 (the "record date"). Also, the number of shares of each
of the Trust's outstanding classes of shares that you held
at that time and the respective net asset values of each
class of shares at that time determine the number of votes
you may cast at the Meeting (or any adjourned meeting or
meetings).

By order of the Board of Trustees,

EDWARD M. W. HINES
Secretary

March 22, 2004

Please Note:

If you do not expect to attend the Meeting, please vote by any of three ways: by
telephone, by the Internet or by completing the enclosed proxy card and
returning it in the accompanying stamped envelope. To avoid unnecessary expense
to the Trust, we request your cooperation in voting no matter how large or small
your holding may be.

Tax-Free Trust of Oregon
380 Madison Avenue, Suite 2300,
New York, New York 10017

Proxy Statement

Introduction

The purpose of the Notice preceding this Proxy Statement is to advise you
of the time, place and purposes of an Annual Meeting of the Shareholders of
Tax-Free Trust of Oregon (the "Trust"), the only series of the Cascades Trust.
The purpose of this Proxy Statement is to give you information on which you may
base your decisions as to the choices, if any, you make in voting.

The Trust's Manager (the "Manager") is Aquila Investment Management LLC,
380 Madison Avenue, Suite 2300, New York, NY 10017, a subsidiary of the Fund's
founder, Aquila Management Corporation. The Trust's principal underwriter (the
"Distributor") is Aquila Distributors, Inc., 380 Madison Avenue, Suite 2300, New
York, NY 10017. The Trust's Investment Sub-Adviser is U.S. Bancorp Asset
Management, Inc. (the "Sub-Adviser"), 555 S.W. Oak Street, Portland, Oregon
97204.

A copy of the Trust's most recent annual report will be sent to you without
charge upon written request to the Distributor, at the above address, or by
calling 800-437-1020 toll-free or 212-697-6666.

This Notice and Proxy Statement are first being mailed on or about March
22, 2004.

You should read this Proxy Statement prior to voting. If your shares are
registered in the name of your broker or someone other than yourself, you may
authorize that person to vote your shares. If your shares are registered in your
name, then you may vote in one of three ways:

(1) Proxy Card

The enclosed proxy card authorizes the persons named (or their substitutes)
to vote your shares; the Trust calls these persons the "proxy holders." As to
the election of Trustees you may authorize the proxy holders to vote your shares
for the entire slate indicated below by marking the appropriate box on the proxy
card or by merely signing and returning your proxy card with no instructions. Or
you may withhold the authority of the proxy holders to vote on the election of
Trustees by marking the appropriate box. Also, you may withhold that authority
as to any particular nominee by following the instructions on the proxy card.

As to the other matter listed on the proxy card, you may direct the proxy
holders to vote your shares on this proposal by marking the appropriate box
"For" or "Against" or instruct them not to vote your shares on the proposal by
marking the "Abstain" box. If you return your signed proxy card and do not mark
a box on the proposal, the proxy holders will vote your shares for that
proposal.

(2) Telephone Voting

To vote your shares by telephone, call the toll-free number on your proxy
card. You will be prompted to enter the control number on your proxy card.
Follow the recorded instructions using your proxy card as a guide. If you vote
by phone, you need not return the proxy card by mail.

(3) Internet Voting

To vote your shares by the Internet, please contact the Trust at the
Internet address shown on your proxy card. You will be prompted to enter the
control number on your proxy card. Follow the instructions on the screen, using
your proxy card as a guide. If you vote by the Internet, you need not return the
proxy card by mail.

General Information

You may end the power of the proxy holders to vote your shares by: (i) so
notifying the Trust in writing; (ii) signing a new and different proxy card (if
the Trust receives it before the old one is used); (iii) voting your shares at
the meeting in person or by your duly appointed agent; or (iv) calling the toll
free number provided or contacting the Trust's Internet address, both of which
are detailed on your proxy card, entering your control number and revoking your
previous vote.

Proxies for shares held by brokers in "street name" and not voted or marked
as abstentions will be counted for purposes of determining a quorum. They will
be counted as present in determining voting results, which will have the same
effect as negative votes.

The Trust is sending you this Notice and Proxy Statement in connection with
the solicitation by its Trustees of proxies to be used at the Annual Meeting to
be held at the time and place and for the purposes indicated in the Notice or
any adjourned meeting or meetings. Whenever it is stated in this Proxy Statement
that a matter is to be acted on at the Meeting, this means the Meeting held at
the scheduled time or any adjourned meeting or meetings.

The Trust pays the costs of the solicitation. Proxies are being solicited
by the use of the mails; they may also be solicited by telephone, facsimile and
personal interviews. Brokerage firms, banks and others may be requested to
forward this Notice and Proxy Statement to beneficial owners of the Trust's
shares so that these owners may authorize the voting of their shares. The Trust
will pay these firms their out-of-pocket expenses for doing so.

On the record date, the Trust had three classes of shares outstanding. All
shareholders of the Trust are entitled to vote at the meeting. Each shareholder
on the record date is entitled to one vote for each dollar (and a proportionate
fractional vote for each fraction of a dollar) of net asset value (determined as
of the record date) represented by full and fractional shares of any class held
on the record date. On the record date, the net asset value per share of each of
the Trust's outstanding classes of shares was as follows: Class A Shares,
$11.06; Class C Shares, $11.05; and Class Y Shares, $11.05. The meeting is
expected to act only upon matters that affect the Trust as a whole: the election
of Trustees and the selection of independent auditors. On matters that affect
the Trust as a whole, all shareholders of the Trust, including the shareholders
of all classes of shares of the Trust, are entitled to vote at the meeting.

On the record date, the total number of shares outstanding for each class
of shares was as follows: Class A Shares, 32,920,642; Class C Shares, 4,027,843;
and Class Y Shares, 3,430,071.

On the record date, the following holders held 5% or more of a class of the
Trust's outstanding shares. On the basis of information received from the
institutional holders the Trust's management believes that all of the shares
indicated are held by them for the benefit of clients.

Name and address Number of shares Percent of class
of the holder of record

Institutional 5% shareholders

Merrill, Lynch,
Pierce, Fenner &
Smith, Inc.,
4800 Deer Lake
Drive East,
Jacksonville, FL 380,470 Class C Shares 9.45%
270,190 Class Y Shares 7.88%

National Financial
Services Corporation
200 Liberty Street
New York, NY 2,447,471 Class Y Shares 71.35%

South Valley Bank and
Trust
P.O. Box 1784
Medford, OR 288,630 Class Y Shares 8.41%

Additional 5% shareholders

The Trust's management is not aware of any other person beneficially owning
more than 5% of any class of its outstanding shares as of such date.

Election of Trustees
(Proposal No. 1)

At the Meeting, ten Trustees are to be elected. Each Trustee elected will
serve until the next annual meeting or until his or her successor is duly
elected. The nominees selected by the Trustees are named in the table below. See
"Introduction" above for information as to how you can vote your shares in the
election of Trustees.

The following material includes information about each nominee and each
officer of the Trust. All shares of the Trust listed as owned by the Trustees
are Class A Shares unless indicated otherwise. All of the nominees are presently
Trustees and were elected by the shareholders in May, 2003, except for Edmund P.
Jensen, who was elected by the Trustees to take office September 6, 2003. All
nominees have consented to serve if elected.

Trustees(1)
and Officers

Number of
Positions Held Portfolios Other Directorships
with in Fund Held by Trustee
Trust and Complex (The position held is
Name, Address(2) Length of Principal Occupation(s) Overseen a directorship unless
and Date of Birth Service(3) During Past 5 Years by Trustee indicated otherwise.)

Interested
Trustees(4)

Lacy B. Herrmann Chairman of Founder and Chairman of the 11 Director or trustee, Pimco
New York, NY the Board of Board, Aquila Management Advisors VIT, Oppenheimer Quest
(05/12/29) Trustees Corporation, the sponsoring Value Funds Group, Oppenheimer
since 1985 organization and parent of the Small Cap Value Fund,
Manager or Administrator and/or Oppenheimer Midcap Fund, and
Adviser or Sub-Adviser to each Oppenheimer Rochester Group of
fund of the Aquilasm Group of Funds.
Funds,(5) Chairman and Chief
Executive Officer and Manager of
the Manager or Administrator
and/or Adviser or Sub-Adviser to
each since 2003, and Founder,
Chairman of the Board of
Trustees and (currently or until
1998) President of each since
its establishment, beginning in
1984; Director of the
Distributor since 1981 and
formerly Vice President or
Secretary, 1981-1998; Trustee
Emeritus, Brown University and
the Hopkins School; active in
university, school and
charitable organizations.

Diana P. Herrmann Trustee since 1994 Vice Chair of Aquila Management 6 None
New York, NY President since Corporation, Founder of the
(02/25/58) 1998, and Vice Aquilasm Group of Funds and
Chair since 2004 parent of the Manager, since
2004, President and Chief
Operating Officer since 1997, a
Director since 1984, Secretary
since 1986 and previously its
Executive Vice President,
Senior Vice President or Vice
President, 1986-1997; Vice
Chair since 2004 and
President, Chief Operating
Officer and Manager of the
Manager since 2003; Vice
Chair, President, Senior Vice
President or Executive Vice
President of funds in the
Aquilasm Group of Funds since
1986; Director of the
Distributor since 1997;
trustee, Reserve Money-Market
Funds, 1999-2000 and Reserve
Private Equity Series,
1998-2000; active in mutual
fund and trade organizations
and in charitable and volunteer
organizations.

Raymond H. Lung Trustee since Retired; trustee, Qualivest 1 None
Portland, OR 1992 Group of Funds, 1994-1997;
(12/24/26) former Executive Vice President
and Executive Trust Officer,
U.S. National Bank of Oregon;
previously active in bank trade
organizations and director of
certain Pacific Northwest
companies.

John W. Mitchell Trustee since Principal of M & H Economic 1 None
Portland, OR 1999 Consultants; Economist, Western
(07/13/44) Region, for U. S. Bancorp since
1998; Chief Economist, U.S.
Bancorp, Portland, Oregon,
1983-1998; member, Oregon
Governor's Council of Economic
Advisors, 1984-1998; Chairman,
Oregon Governor's Technical
Advisory Committee for Tax
Review in 1998.

Non-interested
Trustees

Gary C. Cornia Trustee Director, Romney Institute of 4 None
Orem, UT since 2002 Public Management, Marriott
(06/24/48) School of Management, Brigham
Young University, 2004 -
present; Professor, Marriott
School of Management, 1980 -
present; Past President, the
National Tax Association; Chair
of the Executive Committee, the
International Center for Land
Policy Studies and Training
Institute, Taipei, Taiwan;
formerly Senior Visiting
Fellow, Lincoln Institute of
Land Policy, 2002-2003;
Associate Dean, Marriott School
of Management, Brigham Young
University, 1991-2000; Chair,
Utah Governor's Tax Review
Committee, 1993-2002; member,
Governor's Tax Review Committee
since 2003; Faculty Associate,
the Land Reform Training
Institute, Taipei, Taiwan and
The Lincoln Institute of Land
Policy, Cambridge,
Massachusetts.

.
James A. Gardner Trustee since President, Gardner Associates, 1 None
Terrebonne, OR 1986 an investment and real estate
(07/22/43) firm, since 1989; Partner, the
Canyons Ranch, a real estate
firm, since 1991; President
Emeritus, Lewis and Clark
College and Law School;
director, Oregon High
Desert Museum since 1989,
Vice Chairman since 2002;
active in civic, business,
educational and church
organizations in Oregon.

Edmund P. Jensen Trustee since President and CEO, VISA 1 None
Portland, OR 2003 International, 1994-1999;
(4/13/37) director: Phoenix Technologies,
a Tech/BIOS company, 2000 -
present; BMG-Seltec, a software
company, 2000 - present;
Corillian Corp., a banking
software company, 2000 - 2002;
Trintech, a payment software
company, 1999 - 2002.
Patricia L. Moss Trustee since President and Chief Executive 1 Cascade Bancorp and Bank of
Bend, OR 2002 Officer, Cascade Bancorp & Bank the Cascades; MDU Resources
(07/23/53) of the Cascades since 1998, and Group Inc.
Executive Vice President &
director, Chief Financial
Officer, Chief Operating
Officer, 1987-1998; active in
community and educational
organizations.

Ralph R. Shaw Trustee since President, Shaw Management 1 Schnitzer Steel Industries,
Portland, OR 2000 Company, an investment Inc., Magni Systems, Inc.,
(08/23/38) counseling firm, since 1980, Severon Corporation (formerly
General Partner, Shaw Venture Micromonitors, Inc.), Integra
Partners since 1983, Shaw Telecom, Inc. (formerly OGIT
Venture Partners II since 1987 Communications, Inc.), LaTIS,
and Shaw Venture Partners III Inc., Telestream, Inc., BMG
since 1994 (US Bancorp, parent Seltec Corp.
of the Sub-Adviser, is a limited
partner in the last three
ventures).

Nancy Wilgenbusch Trustee since President, Marylhurst University 1 Chair, Oregon Regional
Marylhurst, OR 2002 since 1984; member, Ethics Advisory Board for PacifiCorp
(09/17/47) Committee of the American ; West Coast Bank's Board;
Institute of Certified Public director, Cascade
Accountants; active board Corporation, a leading
member of a number of civic international manufacturer of
organizations. lift truck attachments;
former Chair, Portland Branch
of the Federal Reserve Bank
of San Francisco.
Officers
Charles E. Executive Vice Executive Vice President of all N/A N/A
Childs, III President Funds since 2003; Senior Vice
New York, NY since 2003 President, corporate
(04/01/57) development, formerly Vice
President, Assistant Vice
President and Associate of the
Manager's parent since 1987;
Senior Vice President, Vice
President or Assistant Vice
President of the Money-Market
Funds since 1988.

James M. McCullough Senior Vice Senior Vice President or Vice N/A N/A
Portland, OR (06/11/45) President President of Aquila Rocky
since 1999 Mountain Equity Fund and four
Aquila Bond Funds; Senior Vice
President of the Distributor
since 2000; Director of Fixed
Income Institutional Sales, CIBC
Oppenheimer & Co. Inc., Seattle,
WA, 1995-1999.

Jerry G. McGrew Senior Vice President of the Distributor N/A N/A
New York, NY (06/18/44) President since 1998, Registered Principal
since 2002 since 1993, Senior Vice
President, 1997-1998 and Vice
President, 1993-1997; Senior
Vice President, Aquila Rocky
Mountain Equity Fund and five
Aquila Bond Funds and Vice
President, Churchill Cash
Reserves Trust, 1995-2001.

Sally J. Church Vice President Vice President, Tax-Free Trust N/A N/A
Portland, OR since 2002 of Oregon since 2002 and
(10/17/48) 1989-1997; retired, 1997-2002.

Christine L. Neimeth Vice President Vice President of Aquila Rocky N/A N/A
Portland, OR since 1998 Mountain Equity Fund and
(02/10/64) Tax-Free Trust of Oregon;
Management Information Systems
consultant, Hillcrest Ski and
Sport, 1997; Institutional
Municipal Bond Salesperson,
Pacific Crest Securities, 1996;
active in college alumni and
volunteer organizations.
Joseph P. DiMaggio Chief Chief Financial Officer of the N/A N/A
New York, NY Financial Aquilasm Group of Funds since
(11/06/56) Officer since 2003 and Treasurer since 2000;
2003 and Controller, Van Eck Global
Treasurer Funds, 1993-2000.
since 2000

Edward M. W. Hines Secretary Partner, Hollyer Brady Smith & N/A N/A
New York, NY since 1985 Hines LLP, legal counsel to the
(12/16/39) Trust, since 1989; Secretary of
the Aquilasm Group of Funds.

Robert W. Anderson Assistant Compliance Officer of the N/A N/A
New York, NY (08/23/40) Secretary Manager or its predecessor and
since 2000 current parent since 1998 and
Assistant Secretary of the
Aquilasm Group of Funds since
2000; trustee, Alpha Strategies
Fund since July, 2002;
Consultant, The Wadsworth Group,
1995-1998.

John M. Herndon Assistant Assistant Secretary of the N/A N/A
New York, NY (12/17/39) Secretary Aquilasm Group of Funds since
since 1995 1995 and Vice President of the
three Aquila Money-Market Funds
since 1990; Vice President of
the Manager or its predecessor
and current parent since 1990.

Lori A. Vindigni Assistant Assistant Treasurer of the N/A N/A
New York, NY Treasurer Aquilasm Group of Funds since
(11/02/66) since 2000 2000; Assistant Vice President
of the Manager or its
predecessor and current parent
since 1998; Fund Accountant for
the Aquilasm Group of Funds,
1995-1998.

Trustee Emeritus
David B. Frohnmayer(6) Trustee President, University of Oregon N/A N/A
Eugene, OR Emeritus since since 1994; former Dean of the
(07/09/40) 2003 University of Oregon Law School
and former Attorney General of
the State of Oregon; Trustee,
Tax-Free Trust of Oregon,
1997-2003.

(1 ) The Trust's Statement of Additional Information includes additional
information about the Trustees and is available, without charge, upon request by
calling 800-437-1020 (toll free).

(2) The mailing address of each Trustee and officer is c/o Tax-Free Trust of
Oregon, 380 Madison Avenue, New York, NY 10017.

(3) Each Trustee holds office until the next annual meeting of shareholders or
until his or her successor is elected and qualifies. The term of office of each
officer is one year.

(4) Mr. Herrmann is an interested person of the Trust as that term is defined in
the 1940 Act as an officer of the Trust and a director, officer and shareholder
of the Manager's corporate parent, as an officer and Manager of the Manager, and
as a shareholder and director of the Distributor. Ms. Herrmann is an interested
person of the Trust as an officer of the Trust, as a director, officer and
shareholder of the Manager's corporate parent, as an officer and Manager of the
Manager, and as a shareholder and director of the Distributor. Each is also an
interested person as a member of the immediate family of the other. Mr. Lung and
Mr. Mitchell are interested persons as security holders of the Sub-Adviser's
parent.

(5) In this material Pacific Capital Cash Assets Trust, Pacific Capital U.S.
Government Securities Cash Assets Trust and Pacific Capital Tax-Free Cash Assets
Trust, each of which is a money-market fund, are called the "Aquila Money-Market
Funds"; Hawaiian Tax-Free Trust, Tax-Free Trust of Arizona, Tax-Free Trust of
Oregon, Tax-Free Fund of Colorado, Churchill Tax-Free Fund of Kentucky,
Narragansett Insured Tax-Free Income Fund and Tax-Free Fund For Utah, each of
which is a tax-free municipal bond fund, are called the "Aquila Bond Funds";
Aquila Rocky Mountain Equity Fund is an equity fund; considered together, these
11 funds are called the "Aquilasm Group of Funds."

(6) As of December 7, 2003, Mr. Frohnmayer ceased to be a Trustee of the Trust.
A Trustee Emeritus may attend Trustee meetings but has no voting power.

Securities Holdings of the Trustees
(as of 12/31/03)

Dollar Range of Aggregate Dollar Range
Name of Ownership in Tax-Free of Ownership in
Trustee Trust of Oregon(1) Aquilasm Investment
Companies Overseen by
Trustee(1)

Interested Trustees

Lacy B. Herrmann B E

Diana P. Herrmann B E

Raymond H. Lung E E

John W. Mitchell C C

Non-interested Trustees

Gary C. Cornia B D

James A. Gardner B B

Edmund P. Jensen C(2) C(2)

Patricia L. Moss E E

Ralph R. Shaw E E

Nancy Wilgenbusch B B

(1) A. None
B. $1-$10,000
C. $10,001-$50,000
D. $50,001-$100,000
E. over $100,000

(2) Purchased after 12/31/03.

None of the non-interested Trustees or their immediate family members holds
of record or beneficially any securities of the Manager, the Sub-Adviser or the
Distributor.

The Trust does not currently pay fees to any of the Trust's officers or to
Trustees affiliated with the Manager or the Sub-Adviser. For its fiscal year
ended September 30, 2003, the Trust paid a total of $125,501 in compensation and
reimbursement of expenses to the Trustees. No other compensation or remuneration
of any type, direct or contingent, was paid by the Trust to its Trustees.

The Trust is one of the 11 funds in the Aquilasm Group of Funds, which
consist of tax-free municipal bond funds, money-market funds and an equity fund.
The following table lists the compensation of all nominees for Trustee who
received compensation from the Trust or from other funds in the Aquilasm Group
of Funds during the Trust's fiscal year. None of such Trustees has any pension
or retirement benefits from the Trust or any of the other funds in the Aquila
group.

Compensation Number of
from all boards on
Compensation funds in the which the
from the Aquilasm Trustee
Name Trust Group Serves

Gary C.
Cornia $9,350 $24,350 4

James A.
Gardner 9,950 10,325 1

Edmund P.
Jensen 400 400 1

Raymond H.
Lung 9,100 9,100 1

John W.
Mitchell 9,100 9,100 1

Patricia L.
Moss 9,350 9,350 1

Ralph R.
Shaw 10,350 10,350 1

Nancy
Wilgenbusch 9,000 9,000 1

Class A Shares may be purchased without a sales charge by certain of the
Trust's Trustees and officers.

The Trust's Manager is a wholly-owned subsidiary of Aquila Management
Corporation ("AMC"), founder of each fund in the Aquilasm Group of Funds. As of
January 31, 2004, these funds had aggregate assets of approximately $4.0
billion, of which approximately $2.5 billion consisted of assets of the tax-free
municipal bond funds. AMC's address is the same as that of the Manager. AMC is
controlled by Mr. Lacy B. Herrmann, through share ownership directly, through
two trusts and by his wife. During the fiscal year ended September 30, 2003, the
Trust paid $1,673,961 in management fees.

During the fiscal year ended September 30, 2003, $525,564 was paid under
Part I of the Trust's Distribution Plan to Qualified Recipients with respect to
the Class A Shares, of which $20,491 was retained by the Distributor. With
respect to Class C Shares, during the same period $262,748 was paid under Part
II of the Plan and $87,582 was paid under the Shareholder Services Plan. Of
these total payments of $350,330, the Distributor received $44,541. All of such
payments were for compensation.

The Distributor currently handles the distribution of the shares of eleven
funds (three money-market funds, seven tax-free municipal bond funds and an
equity fund), including the Trust. Under the Distribution Agreement, the
Distributor is responsible for the payment of certain printing and distribution
costs relating to prospectuses and reports as well as the costs of supplemental
sales literature, advertising and other promotional activities. The shares of
the Distributor are owned 24% by Diana P. Herrmann, 72% by Mr. Herrmann and
other members of his immediate family, and the balance by current employees of
Aquila Management Corporation.

Other Information on Trustees

The Trustees have appointed a standing Audit Committee consisting of all of
the Trustees who are "independent" and are not "interested persons" of the
Trust, as that term is defined in the 1940 Act. The members of the Audit
Committee are Gary C. Cornia, James A. Gardner, Edmund P. Jensen, Patricia L.
Moss, Ralph R. Shaw and Nancy Wilgenbusch. The Committee selects the Fund's
independent auditors (subject to shareholder ratification); (ii) reviews the
methods, scope and result of audits and the fees charged; and (iii) reviews the
adequacy of the Trust's internal accounting procedures and controls. Selection
of auditors is also ratified by the Board of Trustees. The Audit Committee held
one meeting during the Trust's last fiscal year. The Board of Trustees has
adopted a written charter for the Audit Committee, a copy of which is attached
as an appendix to this Proxy Statement.

During the Trust's last fiscal year, the Board of Trustees held six
meetings. Except for Mr. Jensen, who took office September 6, 2003, each current
Trustee was present for at least 75% of the total number of Board meetings and
Audit Committee meetings (if such Trustee was a member of that committee).

The Trust has not yet formed a nominating committee nor adopted a
nominating committee charter. It expects to do so before the next annual meeting
of shareholders. Since 1998, the Trust has had a Trustee Retirement and
Replacement Policy, last reviewed by the Board in September 2001 which covers
many of the issues facing any nominating committee, including matters to be
considered in connection with candidates for election to the Board of Trustees.
In accordance with regulatory requirements, the selection and nomination of all
independent Trustees has been committed to the independent Trustees, and
suggestions for new Trustees are provided from management and other interested
Trustees only upon request of the independent Trustees. It was considered that
there was not enough time to form a nominating committee at the Board meeting in
December 2003, and the Board intends to establish nominating committee policies
and procedures only after more deliberation has been carried out.

Since the beginning of the Trust's most recently completed fiscal year, no
Trustee purchased or sold more than 1% of the outstanding shares of any class of
shares of the Manager, Sub-Adviser or the parents or subsidiaries of either.

Vote Required

To be elected, each nominee must receive the affirmative votes of a
majority of the shares present.

Ratification or Rejection
of Selection of
Independent Auditors
(Proposal No. 2)

KPMG LLP ("KPMG"), which is currently serving as the Trust's independent
auditors, has been selected by the Trust's Audit Committee and ratified by the
Board of Trustees, including a majority of the Independent Trustees, as the
Trust's independent auditors for the fiscal year ending September 30, 2004. Such
selection is submitted to the shareholders for ratification or rejection.

The following table represents fees for professional audit services
rendered by KPMG for the audit of the Trust's annual financial statements for
2002 and 2003, and fees billed for other services rendered by KPMG.

2002 2003

Audit Fees $19,500 $20,100

Audit related fees 0 0

Audit and audit related fees 19,500 20,100

Tax fees (1) 8,950 10,067

All other fees 0 0

Total $28,450 $30,167

(1) Tax fees consisted of fees for tax consultation and tax compliance services.

KPMG did not perform any services during the last fiscal year for the
Trust's investment adviser (the Manager) or any entity controlling, controlled
by or under common control with the Manager that provides services to the Trust.

All audit and non-audit services by KPMG are pre-approved by the Audit
Committee, except that services to be considered between meetings of the
Committee are pre-approved by a selected member of the Committee in accordance
with applicable regulations and subject to additional procedures established by
the Committee.

The Audit Committee has reviewed all services performed and fees charged by
KPMG and has accepted its representation that it is independent in recommending
re-appointment of it for the fiscal year ending September 30, 2004.

KPMG has no direct or indirect financial interest in the Trust, the Manager
or the Sub-Adviser. It is expected that representatives of KPMG will not be
present at the meeting but will be available should any matter arise requiring
their presence.

Receipt of
Shareholder Proposals

Under the proxy rules of the Securities and Exchange Commission,
shareholder proposals meeting tests contained in those rules may, under certain
conditions, be included in the Trust's proxy statement and proxy card for a
particular annual meeting. One of these conditions relates to the timely receipt
by the Trust of any such proposal. Under these rules, proposals submitted for
inclusion in the proxy material for the Trust's next annual meeting after the
meeting to which this Proxy Statement relates must be received by the Trust not
less than 120 days before the anniversary of the date stated in this Proxy
Statement for the first mailing of this Proxy Statement. The date for such
submission could change, depending on the scheduled date for the next annual
meeting; if so, shareholders will be notified.

The fact that the Trust receives a shareholder proposal in a timely manner
does not insure its inclusion in the Trust's proxy material, since there are
other requirements in the proxy rules relating to such inclusion.

Other Business

The Trust does not know of any other matter which will come up for action
at the Meeting. If any other matter or matters properly come up for action at
the Meeting, including any adjournment of the Meeting, the proxy holders will
vote the shares which your proxy card, telephone or Internet vote entitles them
to vote, in accordance with their judgment on such matter or matters, except as
noted. That is, by signing and returning your proxy card or by voting by
telephone or the Internet, you give the proxy holders discretionary authority as
to any such matter or matters.

TAX-FREE TRUST OF OREGON
AUDIT COMMITTEE CHARTER
September 6, 2003

1. The Audit Committee shall be composed entirely of independent Trustees.

2. The purposes of the Audit Committee are:

(a) to oversee the Trust's accounting and financial reporting policies.

(b) to oversee the quality and objectivity of the Trust's financial
statements and the independent audit thereof; and

The function of the Audit Committee is oversight; it is management's
responsibility to maintain appropriate systems for accounting and internal
control, and the auditor's responsibility to plan and carry out a proper audit
and such other functions as deemed appropriate by the Audit Committee.

3. To carry out its purposes, the Audit Committee shall have the following
duties and powers:

(a) to select, retain or terminate the auditors and, in connection
therewith, to evaluate the independence of the auditors, including
whether the auditors provide any consulting services to the manager,
and to receive the auditors' specific representations as to their
independence;

(b) to meet with the Trust's independent auditors, including private
meetings, as necessary (i) to review and approve the audit plan,
detailing the arrangements for and scope of the annual audit, any
special audits and any other services deemed appropriate; (ii) to
discuss any matters of concern relating to the Trust's financial
statements, including any adjustments to such statements recommended
by the auditors, or other results of said audit(s); (iii) to consider
the auditors' comments with respect to the Trust's financial policies,
procedures and internal accounting controls and management's responses
thereto; and (iv) to review the form of opinion the auditors propose
to render to the Board and shareholders;

(c) to consider the effect upon the Trust of any changes in accounting
principles or practices proposed by management or the auditors;

(d) to review and approve the fees charged by the auditors for audit and
non-audit services;

(e) to investigate improprieties or suspected improprieties in Trust
operations;

(f) to establish a complaint mechanism about accounting, internal
accounting controls or auditing matters, including a procedure to
receive confidential, anonymous submissions regarding questionable
accounting and audit matters;

(g) to establish procedures if it believes appropriate for delegation of
pre-approvals of services by auditors to a member or members of the
Committee; and

(h) to report its activities to the full Board on a regular basis and to
make such recommendations with respect to the above and other matters
as the Committee may deem necessary or appropriate.

4. The Committee shall meet on a periodic basis and is empowered to hold
special meetings as circumstances require.

5. The Committee shall periodically meet with the Chief Financial Officer
and/or the Treasurer of the Trust and with internal auditors, if any, for
the management company.

6. The Committee shall have the resources and authority appropriate to
discharge its responsibilities, including the authority to retain special
counsel and other experts or consultants at the expense of the Trust.

7. The Committee shall review this Charter regularly and recommend any changes
to the full Board of Trustees.

<page>

IMPORTANT NOTICE
PLEASE READ IMMEDIATELY

Tax-Free Trust of Oregon

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
to be held on May 3, 2004

PROXY STATEMENT

Aquilasm Group of Funds
Tax-Free Trust of Oregon

<page>

THE AQUILASM GROUP OF FUNDS
380 MADISON AVENUE, SUITE 2300
NEW YORK, NY 10017

VOTE BY TELEPHONE OR INTERNET OR MAIL
24 Hours a day, 7 days a week

TELEPHONE
1-888-221-0697

To vote your shares by telephone, call toll free 1-888-221-0697. Follow the
simple recorded instructions using this proxy card as a guide. If you vote by
phone, you need not return the proxy card by mail.

INTERNET VOTING
www.proxyweb.com/aquila

To vote your shares by the Internet, contact the Trust at
www.proxyweb.com/aquila. Follow the simple instructions at the website, using
your proxy card as a guide. If you vote by the Internet, you need not return the
proxy card by mail.

MAIL

You can vote your shares by completing and returning this proxy card.
Please mark your proxy, date and sign it below and return it promptly in the
accompanying envelope which requires no postage if mailed in the United States.

Please fold and detach card at perforation before mailing.

Aquilasm Group of Funds
Tax-Free Trust of Oregon
Class A

Proxy for Shareholder Meeting May 3, 2004
Proxy Solicited on Behalf of the Board of Trustees

The shareholder(s) of Tax-Free Trust of Oregon (the "Trust") whose
signature(s)appears below does/do hereby appoint LACY B. HERRMANN, DIANA P.
HERRMANN and EDWARD M. W. HINES, or any of them, as attorneys and proxies of the
undersigned, with full power of substitution, to attend the Annual Meeting of
Shareholders of the Trust to be held on Monday, May 3, 2004 at the Oregon
Convention Center, 777 NE Martin Luther King, Jr. Blvd., Portland, OR at 2:00
p.m. Pacific Daylight Time, and at all adjournments thereof, and thereat to vote
the shares held in the name of the undersigned on the record date for said
meeting on the matters listed on the reverse side. Such shares are entitled to
one vote for every dollar of net asset value represented by the share balance
printed below.

Please read the proxy statement prior to voting.

Annual Meeting Attendance

We encourage you to attend the Annual Meeting of Shareholders. If you can join
us, please so indicate on the proxy card or e-mail us at info@aquilafunds.com

Address changes/comments: _______________________________
_________________________________________________________
_________________________________________________________

(If you noted any address changes/comments above, please mark corresponding box
on other side.)

Dated: __________________, 2004

_________________________________
Signature(s) PLEASE SIGN IN THE BOX

PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR(S) ON THIS PROXY CARD. When signing
as a custodian, attorney, executor, administrator, trustee, guardian, etc.,
please sign your full title as such. Joint owners should each sign.

<page>
Tax-Free Trust of Oregon

Please fill in box(es) as shown using black or blue ink or number 2 pencil.
[X] PLEASE DO NOT USE FINE POINT PENS

1. Election of Trustees

01) Lacy B. Herrmann*; 02) Gary C. Cornia; 03) James A. Gardner; 04) Diana P.
Herrmann*; 05) Edmund P. Jensen; 06) Raymond H. Lung*; 07) John W. Mitchell*;
08) Patricia L. Moss; 09) Ralph R. Shaw; 10) Nancy Wilgenbusch

* interested Trustees

__
[__] FOR ALL
__
[__] WITHHOLD ALL
__
[__] FOR ALL EXCEPT

____________________

INSTRUCTION: To withhold authority to vote for one or more (but not all)
nominees, mark "FOR ALL EXCEPT" and write the nominee number(s) and/ or name(s)
on the line above.

[bolded in printed form]

Management recommends a vote FOR all nominees listed above and FOR the proposal
listed below. The shares represented hereby will be voted as indicated at right
or FOR if no choice is indicated.

2. Action on selection of KPMG LLP as independent auditors
(Proposal No.2 in Proxy Statement)
__ __ __
FOR [__] AGAINST [__] ABSTAIN [__]

As to any other matter said proxies shall vote in accordance with their best
judgment. __ I plan to attend the annual meeting in Portland [__]

__
I plan to attend the outreach meeting in Medford [__]

For address changes and/or comments, please check the box at right and write
them on the front where indicated. _
[_]

THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED ON THE REVERSE SIDE.