Important Notice Please Read Immediately Aquilasm Group of Funds TAX-FREE FUND FOR UTAH 380 Madison Avenue, Suite 2300, New York, N Y 10017 Notice of Annual Meeting of Shareholders to be held on October 5, 2000 To shareholders of the fund: The purpose of this Notice is to advise you that an Annual Meeting of the Shareholders of Tax-Free Fund For Utah (the "Fund") will be held: Place: (a) at the Little America Hotel 500 South Main Street Salt Lake City, Utah; Time: (b) on October 5, 2000 at 9:30 a.m. local time; Purposes: (c) for the following purposes: (i) to elect six Trustees; each Trustee elected will hold office until the next annual meeting of the Fund'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 Fund's independent auditors for the fiscal year ending June 30, 2001 (Proposal No. 2); (iii) to act upon a proposal to change the fundamental policies of the Fund to allow the use of additional nationally recognized statistical rating organizations for rating obligations the Fund may purchase (Proposal No. 3); (iv) 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 Fund's records at the close of business on July 17, 2000 (the "record date"). Also, the number of shares of each of the Fund'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 August 7, 2000 Please Note: If you do not expect to attend the Meeting, please indicate voting instructions in any of three ways: by telephone, by e-mail or by completing the enclosed proxy card and returning it in the accompanying stamped envelope. To avoid unnecessary expense to the Fund, we request your cooperation in voting no matter how large or small your holding may be. Tax-Free Fund For Utah 380 Madison Avenue, Suite 2300, New York, New York 10017 PROXY STATEMENT Introduction The purpose of the Notice (the first two pages of this document) is to advise you of the time, place and purposes of an Annual Meeting of the Shareholders of Tax Free-Fund For Utah (the "Fund"). The purpose of this Proxy Statement (all the rest of this document)is to give you information on which you may base your decisions as to the choices, if any, you make in voting. A copy of the Fund's most recent annual report and most recent semi-annual report will be sent to you without charge upon written request to the Fund's Distributor, Aquila Distributors, Inc., 380 Madison Avenue, Suite 2300, New York, NY 10017 or by calling 800-882-4937 toll-free or 212-697-6666. The Fund's founder and Manager (the "Manager") is Aquila Management Corporation, 380 Madison Avenue, Suite 2300, New York, NY 10017. The Fund's principal underwriter (the "Distributor") is Aquila Distributors, Inc., 380 Madison Avenue, Suite 2300, New York, NY 10017. The Fund's Investment Sub-Adviser (the "Sub- Adviser") is Zions First National Bank, One South Main Street, Salt Lake City, Utah 84111. This Notice and Proxy Statement are first being mailed on or about August 7, 2000. You should read the Proxy Statement prior to voting. Then, you may vote in one of three ways: Proxy Card The enclosed proxy card authorizes the persons named (or their substitutes) to vote your shares; the Fund 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 matters listed on the proxy card, you may direct the proxy holders to vote your shares on these proposals 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 the box on a proposal, the proxy holders will vote your shares for that proposal. Telephone Voting To vote your shares by telephone, call the toll free number on your proxy card. You will be prompted to enter the 12-digit 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. Internet Voting To vote your shares by the Internet, please contact the Fund at the address shown on your proxy card . You will be prompted to enter the 12-digit 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 Fund in writing; (ii) signing a new and different proxy card (if the Fund 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 described above or contacting the Fund at the Internet address described above, entering your 12-digit control number and revoking your previous vote. Shares held by brokers in "street name" and not voted or marked as abstentions will not be counted for purposes of determining a quorum or voted on any matter. This policy may make it more difficult to obtain the vote required to approve Proposal No. 3. The Fund 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 Fund 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 Fund's shares so that these owners may authorize the voting of their shares. The Fund will pay these firms their out-of-pocket expenses for doing so. On the record date, the Fund had three classes of shares outstanding. All shareholders of the Fund 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 Fund's outstanding classes of shares was as follows: Class A Shares, $9.42; Class C Shares, $9.42; and Class Y Shares, $9.43. The meeting is expected to act only upon matters that affect the Fund as a whole: the election of Trustees and the action on the proposals. On matters that affect the Fund as a whole, all shareholders of the Fund, including the shareholders of all classes of the Fund, 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, 3,666,509; Class C Shares, 107,408; and Class Y Shares, 13,049. On the record date, the following institutional holders held 5% or more of the Fund's outstanding shares. On the basis of information received from the holders the Fund's management believes that all of the shares indicated are held for the benefit of clients Name and address Number of shares Percent of class of the holder of record Merrill Lynch Pierce 562,769 Class A Shares (15.4%) Fenner & Smith 15,379 Class C Shares (14.3%) 4800 Deer Lake Dr., Jacksonville, FL Fiserv Securities Inc. 447,751 Class A Shares (12.3%) 2005 Market Street, Philadelphia, PA Zions First National Bank 795,518 Class A Shares (21%) P.O. Box 30880, (held in 2 accounts) Salt Lake City, UT Donaldson Lufkin 31,712 Class C Shares (29%) Jenrette Securities (held in 2 accounts) Corporation, Inc. P.O. Box 2052, Jersey City, NJ Additional 5% shareholders TH. P.K. Morris 6,126 Class C Shares (5.7%) P.O. Box 1177 Orem, UT The Fund'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, six 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 instruct the proxy holders as to the voting of your shares as to the election of Trustees. All of the nominees are presently Trustees and were elected by the shareholders in October, 1999. The Trustees and officers as a group own less than 1% of the outstanding shares of the Fund. In the material below and elsewhere in this Proxy Statement, Aquila Management Corporation is referred to as the "Manager" and the Fund's Distributor, Aquila Distributors, Inc., is referred to as the "Distributor." Mr. Herrmann is an interested person of the Fund as that term is defined in the Investment Company Act of 1940 (the "1940 Act") as an officer of the Fund and a director, officer and shareholder of the Manager and the Distributor. Ms. Herrmann is an interested person of the Fund, as an officer, director and shareholder of the Manager and a shareholder and director of the Distributor. Each is also an interested person as a member of the immediate family of the other. They are so designated by an asterisk. In the following material 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 (this Fund), each of which is a tax-free municipal bond fund, are called the "Aquila Bond Funds"; Pacific Capital Cash Assets Trust, Capital Cash Management Trust, Capital Cash U.S. Government Securities Trust, Churchill Cash Reserves 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"; and Aquila Cascadia Equity Fund and Aquila Rocky Mountain Equity Fund are called the "Aquila Equity Funds." Described in the following material are the name, address, positions with the Fund, age as of the record date and business experience during at least the past five years of each nominee and each officer of the Fund. All shares listed as owned by the Trustees are Class A Shares unless indicated otherwise. Name, Position Business Experience with the Fund, Address, Age, Shares owned Lacy B. Herrmann* Founder and Chairman of the Board of Aquila Chairman of the Management Corporation, the sponsoring Board of Trustees organization and Manager or Administrator 380 Madison Avenue and/or Adviser or Sub-Adviser to the New York, NY Aquila Money-Market Funds, the Aquila Bond 10017 Funds and the Aquila Equity Funds, Age: 71 and Founder, Chairman of the Board of Trustees Shares Owned: 595(1) and (currently or until 1998) President of each since its establishment, beginning in 1984; Director of Aquila Distributors, Inc., distributor of the above funds, since 1981 and formerly Vice President or Secretary, 1981-1998; President and a Director of STCM Management Company, Inc., sponsor and sub-adviser to Capital Cash Management Trust; Founder and Chairman of several other money market funds; Director or Trustee of OCC Cash Reserves, Inc. and Quest For Value Accumulation Trust, and Director or Trustee of Oppenheimer Quest Value Fund, Inc., Oppenheimer Quest Global Value Fund, Inc. and Oppenheimer Rochester Group of Funds, each of which is an open- end investment company; Trustee of Brown University, 1990-1996 and currently Trustee Emeritus; actively involved for many years in leadership roles with university, school and charitable organizations. (1)Includes 582 Class A shares and 13 Class Y shares held of record by the Manager Gary C. Cornia Professor and Associate Dean of the Trustee Marriott School of Management, Brigham Young 577 East 1090 North University, since 1991; Associate Professor, Orem, Utah 84057 1985-1991; Assistant Professor, 1980-1985; Age: 52 Commissioner of the Utah Tax Commission,1983- Shares Owned: 141(2) 1986;Director of the National Tax Association, 1990-1993; Chair of the Governor's Tax Review Committee since 1993; Faculty Associate of the Land Reform Training Institute, Taipei, Taiwan and The Lincoln Institute of Land Policy, Cambridge, Massachusetts. Trustee of Tax-Free For Utah since 1993 and of Tax- Free Fund of Colorado. (2) Held of record by his wife. William L. Ensign Planning and Architectural Consultant; Trustee Acting Architect of the United States Capital 766 Holly 1995-1997; Assistant Architect of the United Drive North, States Capital 1980-1995; previously President Annapolis, and CEO, McLeod Ferrara Ensign, an international MD 20401 planning and design firm based in Washington DC; Age: 71 Fellow and former Director of the American Institute Shares Owned: 697(3) of Architects; District of Columbia Zoning Commissioner 1989-1997; member, U.S. Capitol Police Board 1995-1997, National Advisory Council on Historic Preservation 1989-1997, National Capital Memorial Commission 1989- 1997; Acting Director of the U.S. Botanic Garden 1995-1997; Trustee, National Building Museum 1995-1997; Trustee of Tax-Free Trust of Arizona since 1986 and of Tax-Free Fund For Utah (this Fund)since 1991; Trustee of Oxford Cash Management Fund, 1983-1989. (3) Held jointly with his wife Diana P. Herrmann* President and Chief Operating Officer of Trustee and President the Manager/Administrator since 1997, a 380 Madison Director since 1984, Secretary since 1986 Avenue and previously its Executive Vice New York, President, Senior Vice President NY 10017 or Vice President, 1986-1997; Age: 42 President of various Aquila Bond and Shares Owned: 232 Money-Market Funds since 1998; Assistant Vice President, Vice President, Senior Vice President or Executive Vice President of Aquila Money-Market, Bond and Equity Funds since 1986; Trustee of a number of Aquila Money-Market, Bond and Equity Funds since 1995; Trustee of Reserve Money-Market Funds, 1999-2000 and of Reserve Private Equity Series, 1998- 2000; Assistant Vice President and formerly Loan Officer of European American Bank, 1981-1986; daughter of the Fund's Chairman; Trustee of the Leopold Schepp Foundation (academic scholarships) since 1995; actively involved in mutual fund and trade associations and in college and other volunteer organizations. Anne J. Mills Vice President for Business Affairs Trustee of Ottawa University since 1992; 167 Glengarry Place IBM Corporation, 1965-1991; Budget Castle Rock Review Officer of the American Colorado 80104 Baptist Churches/USA, 1994-1997; Age: 61 Director of the American Baptist Foundation, Shares Owned: 145 1985-1996 and since 1998; Trustee of Brown University, 1992-1999; Trustee of Churchill Cash Reserves Trust since 1985, of Tax-Free Trust of Arizona since 1986, of Churchill Tax-Free Fund of Kentucky, Tax-Free Fund of Colorado and Capital Cash Management Trust since 1987 and of Tax-Free Fund For Utah (this Fund)since 1994. R. Thayne Robson Director of the Bureau of Economic Trustee and Business Research, Professor 3548 Westwood Drive, of Management, and Research Professor Salt Lake City, Utah of Economics at the University 84109 of Utah since 1978; Trustee of Tax-Free Age: 71 Fund for Utah (this Fund)since 1992 and of Shares Owned: 144 Aquila Rocky Mountain Equity Fund since 1993; Director of the Alliance of Universities for Democracy since 1990; Trustee of the Salt Lake Convention and Visitors Bureau since 1984; Member of Utah Governor's Economic Coordinating Committee since 1982; Member of the Association for University Business and Economic Research since 1985; Director of ARUP (a medical test laboratory) since 1988; Director of Western Mortgage since 1989; Director of the Utah Economic Development Corporation since 1985; Director of the Salt Lake Downtown Alliance since 1991; Trustee of Crossroads Research Institute since 1986. Jerry G. McGrew President of Aquila Distributors, Senior Vice President Inc. since 1998, Registered 5331 Fayette Street Principal since 1993, Senior Vice Houston, TX 77056 President, 1997-1998 and Vice Age: 54 President, 1993-1997; Senior Vice President of Aquila Rocky Mountain Equity Fund since 1996; Senior Vice President of Churchill Tax-Free Fund of Kentucky since 1994, and of Tax-Free Fund of Colorado and Tax-Free Fund For Utah (this Fund) since 1997; Vice President of Churchill Cash Reserves Trust since 1995; Registered Representative of J.J.B. Hilliard, W.L. Lyons Inc., 1983- 1987; Account Manager with IBM Corporation, 1967-1981; Gubernatorial appointee, Kentucky Financial Institutions Board, 1993-1997; Chairman, Total Quality Management for Small Business, 1990-1994; President of Elizabethtown/Hardin County, Kentucky, Chamber of Commerce, 1989-1991; President of Elizabethtown Country Club, 1983-1985; Director-at Large, Houston Alliance for the Mentally Ill (AMI), since 1998. Kimball L. Young Co-Founder of Lewis Young Robertson & Senior Vice Burningham, Inc., an NASD licensed President broker/dealer providing public 2049 Herbert finance services to Utah local Avenue governments, 1995-present. Senior Vice Salt Lake City, President of Tax-Free Trust of Arizona , UT 84108 Tax-Free Fund For Utah (this Fund),Aquila Age: 53 Cascadia Equity Fund and Aquila Rocky Mountain Equity Fund. Formerly Senior Vice President-Public Finance, Kemper Securities Inc., Salt Lake City, Utah. Stephen J. Caridi Vice President of the Distributor since Assistant Vice 1995, Assistant Vice President 1988-1995, President Marketing Associate, 1986-1988; Vice 380 Madison President of Hawaiian Tax-Free Trust since Avenue 1998; Senior Vice President of Narragansett New York, Insured Tax-Free Income Fund since NY 10017 1998, Vice President since 1996; Assistant Vice Age: 39 President of Tax-Free Fund For Utah (this Fund) since 1993; Mutual Funds Coordinator of Prudential Bache Securities, 1984-1986; Account Representative of Astoria Federal Savings and Loan Association, 1979-1984. Rose F. Marotta Chief Financial Officer of the Aquila Chief Financial Officer Money-Market, Bond and Equity Funds 380 Madison Avenue since 1991 and Treasurer, 1981-1991; New York, NY formerly Treasurer of the predecessor of 10017 Capital Cash Management Trust; Treasurer Age: 76 and Director of STCM Management Company, Inc., since 1974; Treasurer of InCap Management Corporation since 1982, of the Manager since 1984 and of the Distributor, 1985-2000. Richard F. West Treasurer of the Aquila Money-Market, Treasurer Bond and Equity Funds and of Aquila 380 Madison Avenue Distributors, Inc. since 1992; New York, NY Associate Director of Furman Selz 10017 Incorporated, 1991-1992; Vice Age: 64 President of Scudder, Stevens & Clark, Inc. and Treasurer of Scudder Institutional Funds, 1989-1991; Vice President of Lazard Freres Institutional Funds Group, Treasurer of Lazard Freres Group of Investment Companies and HT Insight Funds, Inc., 1986-1988; Vice President of Lehman Management Co., Inc. and Assistant Treasurer of Lehman Money Market Funds, 1981-1985; Controller of Seligman Group of Investment Companies, 1960-1980. Lori A Vindigni Assistant Vice President of Aquila Management Assistant Treasurer Corporation since 1998, formerly Fund Accountant 380 Madison Avenue for the Aquila Group of Investment Companies New York, NY since 1995; Staff Officer and Fund Accountant of 10017 Citibank Global Asset Management Group of Age: 33 Investment Companies, 1994-1995; Fund Accounting Supervisor of Dean Witter Group of Investment Companies, 1990-1994; BS Kean College of New Jersey, 1990. Edward M. W. Hines Partner of Hollyer Brady Smith & Hines LLP, Secretary attorneys, since 1989 and counsel, 551 Fifth Avenue 1987-1989; Secretary of the Aquila New York, NY Money-Market, Bond and Equity Funds since 1982; 10176 Secretary of Trinity Liquid Assets Trust, 1982- Age: 60 1985 and Trustee of that Trust, 1985-1986; Secretary of Oxford Cash Management Fund, 1982-1988. John M. Herndon Assistant Secretary of the Aquila Money- Assistant Secretary Market, Bond and Equity Funds since 1995 380 Madison Avenue and Vice President of the Aquila Money- New York, NY Market Funds since 1990; Vice President of 10017 the Manager since 1990; Investment Services Age: 60 Consultant and Bank Services Executive of Wright Investors' Service, a registered investment adviser, 1983- 1989; Member of the American Finance Association, the Western Finance Association and the Society of Quantitative Analysts. Robert W. Anderson Compliance Officer since 1998 and Assistant Assistant Secretary and Secretary of the Aquila Money-Market Funds Compliance Officer and the Aquila Bond and Equity Funds; 380 Madison Avenue, Consultant, The Wadsworth Group, 1995-1998; New York, Executive Vice President of Sheffield NY 10017 Management Company (investment adviser and Age: 59 distributor of a mutual fund group), 1986-1995. The Fund does not currently pay fees to any of the Fund's officers or to Trustees affiliated with the Manager or the Sub- Adviser. For its fiscal year ended June 30, 2000 the Fund paid a total of $17,000 in compensation and reimbursement of expenses to the Trustees. No other compensation or remuneration of any type, direct or contingent, was paid by the Fund to its Trustees. The Fund is one of the 15 Funds in the Aquilasm Group of Funds, which consist of tax-free municipal bond funds, money- market funds and equity funds. The following table lists the compensation of all nominees for Trustees who received compensation from the or from other Funds in the Aquilasm Group of Funds during the fund's fiscal year None of such Trustees has any pension or retirement benefits from the or any of the other Funds in the Aquila group. Compensation Number of from all boards on Compensation Funds which the from the in the Trustee Fund Aquilasm serves Name Group of Funds Gary C. Cornia $5,450 $ 6,150 2 William L. Ensign $3,850 $13,500 2 R. Thayne Robson $3,850 $ 6,950 2 Anne J. Mills $3,850 $39,550 6 Class A Shares may be purchased without a sales charge by certain of the Fund's Trustees and officers. The Fund's Manager is Manager or Administrator to the Aquilasm Group of Funds, which consists of tax-free municipal bond funds, money-market funds and equity funds. As of June 30, 2000 these funds had aggregate assets of approximately $3.1 billion, of which approximately $1.8 billion consisted of assets of the tax-free municipal bond funds. The Manager is controlled by Mr. Lacy B. Herrmann, through share ownership directly, through a trust and by his wife. During the fiscal year ended June 30, 2000,the Fund incurred Management fees of $204,781, of which $166,101 was waived and the balance was paid to the Sub- Adviser. During the fiscal year ended June 30,2000, $79,463, was paid under Part I of the Fund's Distribution Plan to Qualified Recipients with respect to the Class A Shares, of which,$2,003 was retained by the Distributor. With Respect to Class C Shares, during the same period $9,165 was paid under Part II of the Plan and $3,055 was paid under the Shareholder Services Plan. Of these total payments of $12,220, the Distributor received $6,364. All of such payments were for compensation. The Distributor currently handles the distribution of the shares of fifteen funds (six money-market funds, seven tax-free municipal bond funds and two equity funds), including the Fund. 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 72% by Mr. Herrmann and other members of his immediate family, 24% by Diana P. Herrmann and the balance by a former officer of the Distributor. Other Information on Trustees The Trustees have appointed a standing Audit Committee consisting of all of the Trustees (the "Independent Trustees") who are not "interested persons" of the Fund, as that term is defined in the 1940 Act. The Committee (i) recommends to the Board of Trustees what firm of independent auditors will be selected by the Board of Trustees (subject to shareholder ratification); (ii) reviews the methods, scope and result of audits and the fees charged; and (iii) reviews the adequacy of the Fund's internal accounting procedures and controls. The Committee held two meetings during the Fund's last fiscal year. The Board of Trustees does not have a nominating committee. During the Fund's last fiscal year, the Board of Trustees held four meetings. All current Trustees were 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). Ratification or Rejection of Selection of Independent Auditors (Proposal No. 2) KPMG LLP, which is currently serving as the Fund's auditors, has been selected by the Fund's Board of Trustees, including a majority of the Independent Trustees, as the Fund's independent auditors for the fiscal year ending June 30, 2001. Such selection is submitted to the shareholders for ratification or rejection. The firm has no direct or indirect financial interest in the Fund, the Manager or the Sub-Adviser. It is expected that representatives of the firm will not be present at the meeting but will be available should any matter arise requiring their presence. Action Regarding a Change in the Fund's Fundamental Policies to Allow the Use of Additional Nationally Recognized Statistical Rating Organizations for Rating Obligations the Fund May Purchase (Proposal No. 3) Since beginning operations, the Fund has had a Fundamental policy that defines the "investment-grade" securities the Fund may purchase as those rated within the four highest credit ratings assigned by Moody's Investors Service, Inc. ("Moody's") or Standard & Poor's Corporation ("S&P") or, if unrated, determined to be of comparable quality. When this Fundamental policy was put in place Moody's and S&P were essentially the only nationally recognized statistical rating organizations ("NRSROs") with respect to municipal obligations. In recent years, other organizations, notably Fitch IBCA, Inc. ("Fitch"), have become active in rating municipal obligations. Municipal bond issuers pay to have their bonds rated and there is competition among the NRSROs. If an issuer chooses to have its bonds rated by an NRSRO other than Moody's or S&P, the current Fundamental policy of the Fund has the effect of requiring the Fund either to forego purchasing the bonds because they are not rated by Moody's or S&P or to treat them as "unrated" when in fact they do have ratings assigned by an NRSRO. Both results distort the clear intent of the policy. Accordingly the Board of Trustees has determined that it would be in the best interest of the Fund and its shareholders to change the Fundamental policy so that the ratings used to define "investment-grade" securities would include those assigned by any NRSRO approved from time to time by the Board of Trustees. At the present time, if the proposed change is adopted, the Board of Trustees will approve Fitch in addition to Moody's and S&P. The Board of Trustees has determined that the standards Fitch employs in rating bonds are comparable to those of Moody's and S&P that bonds in the four highest categories rated by Fitch are of comparable quality to those similarly rated by Moody's and S&P. Action Requested The Board of Trustees recommends that the proposed change in the Fund's fundamental policies described above be approved. Vote Required The favorable vote of the holders of a majority (as defined in the 1940 Act) of the outstanding shares of the Fund is required for the approval of this Proposal No. 3. Under the 1940 Act, the vote of the holders of a majority of the outstanding shares of the Fund means the vote of the holders of the lesser of (a) 67% or more of the shares of the Fund present at the Meeting or represented by proxy if the holders of more than 50% of such shares are so present or represented, or (b) more than 50% of the outstanding shares of the Fund, with 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 all of the Fund's three classes of shares. If this proposal is not approved, the Board of Trustees will consider appropriate action, which could include continuing with the present policies or calling another meeting of shareholders. The meeting can be adjourned by the affirmative vote of a majority of the shares present in person or by proxy. In voting for an adjournment, the proxy holders will consider all relevant factors, including possible delay of receipt of proxies and whether or not a substantial number of negative votes have been cast with respect to any proposal. The shares of shareholders who have voted by proxy against a proposal will be voted against adjournment. 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 Fund's proxy statement and proxy card for a particular annual meeting. One of these conditions relates to the timely receipt by the Fund of any such proposal. Under these rules, proposals submitted for inclusion in the proxy material for the Fund's next annual meeting after the meeting to which this Proxy Statement relates must be received by the Fund 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, the Fund will so advise you. The fact that the Fund receives a shareholder proposal in a timely manner does not insure its inclusion in the Fund's proxy material, since there are other requirements in the proxy rules relating to such inclusion. Other Business The Fund 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. 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. Important Notice Please Read Immediately Tax-Free Fund For Utah Notice Of Annual Meeting Of Shareholders to be held on October 5, 2000 PROXY STATEMENT Aquilasm Group of Funds TAX-FREE FUND FOR UTAH Class A Shares PROXY FOR SHAREHOLDERS MEETING OCTOBER 5, 2000 PROXY SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES The undersigned shareholder of TAX-FREE FUND FOR UTAH (the "Fund") does 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 Fund to be held on Thursday, October 5, 2000 at Little America Hotel, 500 South Main Street, Salt Lake City, Utah at 9:30 a.m. local 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 below. 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 VOTE BY TELEPHONE OR INTERNET OR MAIL 24 Hours a day, 7 days a week Telephone 1-800-690-6903 To vote your shares by telephone, call toll free 1-800-690- 6903. You will be prompted to enter the 12-digit control number on this proxy card. 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 www.proxyvote.com To vote your shares by the Internet, contact the Fund at www.proxyvote.com You will be prompted to enter the 12-digit control number on this proxy card. 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. TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: _________________________________________________________________ THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED TAX-FREE FUND FOR UTAH CLASS A Shares For address changes and/or comments, please check this box and write them on the back where indicated. [_] Vote on Trustees (Proposal No.1 in Proxy Statement) 1. Election of Trustees 01) Lacy B. Herrmann* 02) Gary C. Cornia 03) William L. Ensign 04) Diana P. Herrmann* 05) Anne J. Mills 06) R. Thayne Robson * interested Trustees __ [__] For all __ [__] Withhold all __ [__] For all except 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 below. MANAGEMENT RECOMMENDS A VOTE FOR ALL NOMINEES LISTED ABOVE AND FOR THE PROPOSALS LISTED BELOW. THE SHARES REPRESENTED HEREBY WILL BE VOTED AS INDICATED BELOW OR FOR IF NO CHOICE IS INDICATED. As to any other matter said proxies shall vote in accordance with their best judgment. 2. Action on selection of KPMG LLP as independent auditors (Proposal No.2 in Proxy Statement) FOR [__] AGAINST [__] ABSTAIN [__] 3. Action on change of fundamental policy of the Fund (Proposal No.3 in Proxy Statement) FOR [__] AGAINST [__] ABSTAIN [__] Please indicate if you plan to attend the Shareholder Meeting. If you mark the box below, you must return the proxy card by mail to have this information recorded. S. I plan to attend the annual meeting in Salt Lake City. [__] PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as a custodian, attorney, executor, administrator, trustee, guardian, etc., please sign your full title as such. Joint owners should each sign. _________________________________Dated: _________ Signature [Please sign within the box] _________________________________Dated: __________ Signature (Joint Owners) Aquilasm Group of Funds TAX-FREE FUND FOR UTAH Class C Shares PROXY FOR SHAREHOLDERS MEETING OCTOBER 5, 2000 PROXY SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES The undersigned shareholder of TAX-FREE FUND FOR UTAH (the "Fund") does 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 Fund to be held on Thursday, October 5, 2000 at Little America Hotel, 500 South Main Street, Salt Lake City, Utah at 9:30 a.m. local 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 below. 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 VOTE BY TELEPHONE OR INTERNET OR MAIL 24 Hours a day, 7 days a week Telephone 1-800-690-6903 To vote your shares by telephone, call toll free 1-800-690- 6903. You will be prompted to enter the 12-digit control number on this proxy card. 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 www.proxyvote.com To vote your shares by the Internet, contact the Fund at www.proxyvote.com You will be prompted to enter the 12-digit control number on this proxy card. 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. TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: _________________________________________________________________ THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED TAX-FREE FUND FOR UTAH CLASS C Shares For address changes and/or comments, please check this box and write them on the back where indicated. [_] Vote on Trustees (Proposal No.1 in Proxy Statement) 1. Election of Trustees 01) Lacy B. Herrmann* 02) Gary C. Cornia 03) William L. Ensign 04) Diana P. Herrmann* 05) Anne J. Mills 06) R. Thayne Robson * interested Trustees __ [__] For all __ [__] Withhold all __ [__] For all except 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 below. MANAGEMENT RECOMMENDS A VOTE FOR ALL NOMINEES LISTED ABOVE AND FOR THE PROPOSALS LISTED BELOW. THE SHARES REPRESENTED HEREBY WILL BE VOTED AS INDICATED BELOW OR FOR IF NO CHOICE IS INDICATED. As to any other matter said proxies shall vote in accordance with their best judgment. 2. Action on selection of KPMG LLP as independent auditors (Proposal No.2 in Proxy Statement) FOR [__] AGAINST [__] ABSTAIN [__] 3. Action on change of fundamental policy of the Fund (Proposal No.3 in Proxy Statement) FOR [__] AGAINST [__] ABSTAIN [__] Please indicate if you plan to attend the Shareholder Meeting. If you mark the box below, you must return the proxy card by mail to have this information recorded. S. I plan to attend the annual meeting in Salt Lake City. [__] PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as a custodian, attorney, executor, administrator, trustee, guardian, etc., please sign your full title as such. Joint owners should each sign. _________________________________Dated: _________ Signature [Please sign within the box] _________________________________Dated: __________ Signature (Joint Owners) Aquilasm Group of Funds TAX-FREE FUND FOR UTAH Class Y Shares PROXY FOR SHAREHOLDERS MEETING OCTOBER 5, 2000 PROXY SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES The undersigned shareholder of TAX-FREE FUND FOR UTAH (the "Fund") does 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 Fund to be held on Thursday, October 5, 2000 at Little America Hotel, 500 South Main Street, Salt Lake City, Utah at 9:30 a.m. local 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 below. 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 VOTE BY TELEPHONE OR INTERNET OR MAIL 24 Hours a day, 7 days a week Telephone 1-800-690-6903 To vote your shares by telephone, call toll free 1-800-690- 6903. You will be prompted to enter the 12-digit control number on this proxy card. 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 www.proxyvote.com To vote your shares by the Internet, contact the Fund at www.proxyvote.com You will be prompted to enter the 12-digit control number on this proxy card. 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. TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: _________________________________________________________________ THIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED TAX-FREE FUND FOR UTAH CLASS Y Shares For address changes and/or comments, please check this box and write them on the back where indicated. [_] Vote on Trustees (Proposal No.1 in Proxy Statement) 1. Election of Trustees 01) Lacy B. Herrmann* 02) Gary C. Cornia 03) William L. Ensign 04) Diana P. Herrmann* 05) Anne J. Mills 06) R. Thayne Robson * interested Trustees __ [__] For all __ [__] Withhold all __ [__] For all except 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 below. MANAGEMENT RECOMMENDS A VOTE FOR ALL NOMINEES LISTED ABOVE AND FOR THE PROPOSALS LISTED BELOW. THE SHARES REPRESENTED HEREBY WILL BE VOTED AS INDICATED BELOW OR FOR IF NO CHOICE IS INDICATED. As to any other matter said proxies shall vote in accordance with their best judgment. 2. Action on selection of KPMG LLP as independent auditors (Proposal No.2 in Proxy Statement) FOR [__] AGAINST [__] ABSTAIN [__] 3. Action on change of fundamental policy of the Fund (Proposal No.3 in Proxy Statement) FOR [__] AGAINST [__] ABSTAIN [__] Please indicate if you plan to attend the Shareholder Meeting. If you mark the box below, you must return the proxy card by mail to have this information recorded. S. I plan to attend the annual meeting in Salt Lake City. [__] PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR HEREON. When signing as a custodian, attorney, executor, administrator, trustee, guardian, etc., please sign your full title as such. Joint owners should each sign. _________________________________Dated: _________ Signature [Please sign within the box] _________________________________Dated: __________ Signature (Joint Owners)