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 811-6239
Tax-Free Fund for Utah
(Exact name of Registrant as specified in charter)
380 Madison Avenue
New York, New York 10017
(Address of principal executive offices) (Zip code)
Joseph P. DiMaggio
380 Madison Avenue
New York, New York 10017
(Name and address of agent for service)
Registrant's telephone number, including area code: (212) 697-6666
Date of fiscal year end: 6/30
Date of reporting period: 06/30/07
FORM N-CSR
ITEM 1. REPORTS TO STOCKHOLDERS.
ANNUAL
REPORT
JUNE 30, 2007
[LOGO OF TAX-FREE FUND FOR UTAH:
A RECTANGLE CONTAINING DESERT BOULDERS WITH THE SUN RISING BEHIND THEM](SM)
TAX-FREE FUND FOR
UTAH
A TAX-FREE INCOME INVESTMENT
[LOGO OF THE AQUILA
GROUP OF FUNDS: ONE OF THE
AN EAGLE'S HEAD] AQUILA GROUP OF FUNDS(SM)
[LOGO OF TAX-FREE FUND FOR UTAH:
A RECTANGLE CONTAINING DESERT BOULDERS
WITH THE SUN RISING BEHIND THEM](SM)
SERVING UTAH INVESTORS FOR 15 YEARS
TAX-FREE FUND FOR UTAH
"PROFESSIONAL MANAGEMENT"
August, 2007
Dear Fellow Shareholder:
Rising interest rates, reaching for yield and tightening yield curves - these
are all topics that have been in the news as of late. While there is a plethora
of information available on these topics and others if you are interested, the
good news is that when it comes to Tax-Free Fund For Utah you don't need to be
versed in "financialese" any more than you wish.
Why? Because one of the conveniences afforded you through an investment in
Tax-Free Fund For Utah is local active professional portfolio management. The
Fund's portfolio managers continuously monitor economic, monetary and financial
trends and adjust the portfolio accordingly as and when they deem appropriate.
Your Fund's portfolio managers provide ongoing surveillance of the marketplace
and strive to maneuver cautiously through its ups and downs - much like a ship's
captain whose job it is to ride out sudden storms.
Not unlike the prudent ship's captain who ensures that the cargo is properly
balanced and positioned, the Fund's portfolio managers are constantly monitoring
the investment portfolio and the economic weather conditions striving to provide
as stable a net asset value and as high a level of tax-free income as possible.
As with a ship in choppy seas, your investment requires constant vigilance and
nimble reflexes in all phases of its management. This does not, however, mean
selling and buying securities continuously based upon market
NOT A PART OF THE ANNUAL REPORT
blips. What it does mean is being a keen observer of the scene, monitoring
securities very carefully and taking action as appropriate whenever significant
changes occur or are anticipated.
Your portfolio managers seek opportunities that make sense within the prevailing
marketplace and which provide double tax-free income while maintaining the
overall conservative nature of the portfolio.
In short, your professional managers do the work for you. So, the next time you
come across a boring, complex analysis of the bond market, feel free to flip
right past it. Your Fund's portfolio management team's job (and their passion)
is to keep on top of and make sense out of all the news. Thus, like a seasoned
traveler, you can enjoy your trip knowing that there are experienced eyes
watching the waters and steady hands on the helm.
Sincerely,
/s/ Lacy B. Herrmann /s/ Diana P. Herrmann
Lacy B. Herrmann Diana P. Herrmann
Founder and Chairman Emeritus President
For certain investors, some dividends of your Fund may be subject to Federal and
State taxes, including the Alternative Minimum Tax.
NOT A PART OF THE ANNUAL REPORT
[LOGO OF TAX-FREE FUND FOR UTAH:
A RECTANGLE CONTAINING DESERT BOULDERS
WITH THE SUN RISING BEHIND THEM](SM)
SERVING UTAH INVESTORS FOR 15 YEARS
TAX-FREE FUND FOR UTAH
ANNUAL REPORT
MANAGEMENT DISCUSSION
The Federal Reserve (the "Fed") has maintained the target for the
overnight federal funds rate at 5.25% for the past nine consecutive Open Market
Committee meetings, unchanged since June 2006. This "sideways" move in
short-term rates has recently led to a positively sloped U. S. Treasury yield
curve, with 30-year Treasuries yielding over 5.25%. The Fed's strategy of
containing inflation by not allowing the national economy to overheat has
recently been a bit of a challenge. While both the Consumer Price Index ("CPI")
and the Producer Price Index ("PPI") have been reasonably well contained, except
for troublesome energy costs, housing starts and dramatically slowed sales of
existing homes across the country. Comments from Fed chairman Paul Bernanke hint
at the possibility that further rate hikes will depend more on inflation than
economic expansion, somewhat of a reversal from a year ago. With segments of the
economy "cooling down", especially the housing market, perhaps rates are
approaching their peak. The jury is still out, but we remain hopeful!
We have been witness to a number of national and international events that
affect both our spirit and the economy: the ongoing conflicts in Iraq and
Afghanistan, renewed concern of terrorist attacks here and abroad, provocative
statements and actions by Iran regarding their nuclear ambitions, severe drought
conditions across much of the nation, and continuing record prices at the gas
pump.
As we head into the second half of 2007, we think it is likely that the
Fed will maintain the current target for short-term rates. The unemployment rate
of 4.5% is the lowest rate reported since July 2001. Other measures of economic
progress - retail sales, housing starts, and industrial production are all well
off their highs of the past 12 months - clear signs of a moderating economy.
Historically, as we see slowing on the economic front, inflation will also show
signs of easing. While this cycle is a bit different because of record high
energy prices, we believe it is likely that the economy will grow at an
estimated 2.50% - 3.50% annual rate.
Tax-Free Fund For Utah's Class A shares experienced an increase in share
value (Net Asset Value) of $0.04 - approximately 0.41% - for the 12-month period
ending June 30, 2007. The Class A share value was $9.91 on June 30, 2007 - up
from $9.87 on June 30, 2006. The yield of a typical AA-rated general obligation
bond with a 15 year maturity fell to 4.47% from 4.52% over this same period. The
distribution yield on the Fund's Class A shares was 4.06% on June 30, 2007.
Assuming a 28% federal income tax rate, this equates to a taxable equivalent
yield of 5.64%. Using the maximum federal income tax rate of 35%, the taxable
equivalent yield was 6.25%.
Equity returns for the 12 months ended June 30, 2007 continued their
positive performance from last year: the Dow Jones Industrial Average was up
23.02%; the S & P 500 Index was up 20.57%; and the NASDAQ Composite Index was up
20.71%. Tax-Free Fund For Utah had a total rate of return of 4.60% for the past
12 months.
MANAGEMENT DISCUSSION (CONTINUED)
Historically, as the economy has grown, commodity prices and interest
rates rise. We continue to monitor any changes in the market and strive to
position Tax-Free Fund For Utah's portfolio accordingly. To address the concerns
raised by any increase in the overall level of interest rates, we take great
care in the selection of the individual bonds purchased for the Fund. We will
seek to continue to add high quality, intermediate maturity Utah municipal bonds
that best meet our demanding standards.
The investment objective of Tax-Free Fund For Utah is to provide as high a
level of double tax-exempt current income as is consistent with the preservation
of capital. We believe this objective continues to be successfully addressed by
our adherence to a discipline of solid fundamental, conservative portfolio
management ideals. The Fund continues to maintain an average quality rating of
"AA", with over 68% of the portfolio rated "AAA". We believe that the Fund's
laddered maturity structure helps us manage price volatility. The portfolio has
an average life of approximately 13.7 years and a modified duration of 7.02
years. We seek to maintain a well-diversified portfolio, which currently
consists of 365 different issues, all of which are 100% exempt from Federal and
Utah state income taxes.
With the national and local economies continuing to show improvement, we
will remain vigilant and do whatever is necessary as we strive to continue to
meet the Fund's investment objective. We intend to "stay the course" and manage
the portfolio by taking advantage of opportunities in the Utah marketplace that
are consistent with the high standards of the Fund.
PERFORMANCE REPORT
The following graph illustrates the value of $10,000 invested in the Class
A shares of Tax-Free Fund For Utah for the 10-year period ended June 30, 2007 as
compared with the Lehman Brothers Quality Intermediate Municipal Bond Index and
the Consumer Price Index (a cost of living index). The performance of each of
the other classes is not shown in the graph but is included in the table below.
It should be noted that the Lehman Index does not include any operating expenses
nor sales charges and being nationally oriented, does not reflect state specific
bond market performance.
[Graphic of a line chart with the following information:]
Lehman Brothers
Cost of Fund Class A Shares Fund Class A Shares Quality Intermediate
Living Index no sales charge with sales charge Municipal Bond Index
6/97 10,000 10,000 9,600 10,000
6/98 10,169 10,784 10,354 10,695
6/99 10,381 10,993 10,554 11,019
6/00 10,712 11,231 10,783 11,463
6/01 11,099 12,213 11,725 12,476
6/02 11,230 12,984 12,466 13,343
6/03 11,462 14,139 13,574 14,387
6/04 11,811 14,004 13,445 14,436
6/05 12,142 15,012 14,412 15,214
6/06 12,648 15,021 14,421 15,266
6/07 12,986 15,662 15,036 15,905
AVERAGE ANNUAL TOTAL RETURN
FOR PERIODS ENDED JUNE 30, 2007
-------------------------------------------
SINCE
1 YEAR 5 YEARS 10 YEARS INCEPTION
------ ------- -------- ---------
Class A (commenced operations on 7/24/92)
With Sales Charge .................... 0.43% 3.69% 4.42% 5.11%
Without Sales Charge ................. 4.60 4.54 4.85 5.40
Class C (commenced operations on 5/21/96)
With CDSC ............................ 2.74 3.69 3.91 4.21
Without CDSC ......................... 3.77 3.69 3.91 4.21
Class Y (commenced operations on 5/21/96)
No Sales Charge ...................... 4.80 4.71 5.03 5.34
Lehman Index ................................. 4.19 3.57 4.75 5.21* (Class A)
4.80** (Class C&Y)
Total return figures shown for the Fund reflect any change in price and assume
all distributions within the period were invested in additional shares. Returns
for Class A shares are calculated with and without the effect of the initial 4%
maximum sales charge. Returns for Class C shares are calculated with and without
the effect of the 1% contingent deferred sales charge (CDSC), imposed on
redemptions made within the first 12 months after purchase. Class Y shares are
sold without any sales charge. The rates of return will vary and the principal
value of an investment will fluctuate with market conditions. Shares, if
redeemed, may be worth more or less than their original cost. A portion of each
class's income may be subject to federal and state income taxes and/or the
federal alternative minimum tax. Past performance is not predictive of future
investment results.
* From commencement of operations on 7/24/92.
** From commencement of operations on 5/21/96.
- --------------------------------------------------------------------------------
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees and Shareholders of
Tax-Free Fund For Utah:
We have audited the accompanying statement of assets and liabilities,
including the schedule of investments, of Tax-Free Fund For Utah as of June 30,
2007 and the related statement of operations for the year then ended, and the
statements of changes in net assets and the financial highlights for each of the
two 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. The financial highlights for each of the years in the three
year period ended June 30, 2005 have been audited by other auditors, whose
report dated August 12, 2005 expressed an unqualified opinion on such financial
highlights.
We conducted our audits in accordance with the standards of the Public
Company Accounting Oversight Board (United States). Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements and financial highlights are free of material misstatement.
The Fund is not required to have, nor were we engaged to perform, an audit of
the Fund's internal control over financial reporting. Our audits included
consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the Fund's
internal control over financial reporting. Accordingly, we express no such
opinion. An audit also 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 June 30, 2007, by correspondence with the
custodian and brokers. 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
Tax-Free Fund For Utah as of June 30, 2007, the results of its operations for
the year then ended, and the changes in its net assets and the financial
highlights for each of the two years in the period then ended, in conformity
with accounting principles generally accepted in the United States of America.
TAIT, WELLER & BAKER LLP
Philadelphia, Pennsylvania
August 17, 2007
- --------------------------------------------------------------------------------
TAX-FREE FUND FOR UTAH
SCHEDULE OF INVESTMENTS
JUNE 30, 2007
RATING
PRINCIPAL MOODY'S/
AMOUNT GENERAL OBLIGATION BONDS (23.7%) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
CITY, COUNTY AND STATE (10.7%)
Anderson, Indiana San District
$ 505,000 4.600%, 07/15/23 AMBAC Insured ......................... Aaa/AAA $ 508,611
Brian Head, Utah
405,000 6.500%, 03/15/24 ....................................... NR/NR* 431,017
Cedar City, Utah Special Improvement
District Assessment
235,000 5.050%, 09/01/10 ....................................... NR/NR* 239,164
215,000 5.200%, 09/01/11 ....................................... NR/NR* 220,715
Cedar Park, Texas
835,000 4.500%, 02/15/22 MBIA Insured .......................... Aaa/AAA 827,902
Clearfield City, Utah
2,095,000 5.125%, 02/01/18 MBIA Insured (pre-refunded) ........... Aaa/AAA 2,136,272
Coral Canyon, Utah Special Service District
140,000 4.850%, 07/15/17 ....................................... NR/NR* 142,457
580,000 5.700%, 07/15/18 ....................................... NR/NR* 593,189
Dawson County, Texas Hospital District
555,000 4.375%, 02/15/24 AMBAC Insured ......................... NR/AAA 534,959
Denton County, Texas
700,000 4.500%, 07/15/24 MBIA Insured .......................... Aaa/AAA 684,509
400,000 4.500%, 07/15/25 MBIA Insured .......................... Aaa/AAA 387,504
Denton County, Texas Public Improvement
1,500,000 4.250%, 07/15/27 MBIA Insured .......................... Aaa/AAA 1,372,665
Harris County, Texas Utility District #268
905,000 4.375%, 09/01/27 Radian Insured ........................ Aa3/AA 830,138
Hurricane, Utah
185,000 5.400%, 11/01/09 Radian Insured ........................ NR/AA 190,470
Laredo, Texas
300,000 4.250%, 08/15/21 AMBAC Insured ......................... Aaa/AAA 290,691
500,000 4.500%, 02/15/24 AMBAC Insured ......................... Aaa/AAA 489,100
McKinney, Texas
1,700,000 4.500%, 08/15/23 XLCA Insured .......................... Aaa/AAA 1,667,462
1,375,000 5.000%, 08/15/24 XLCA Insured .......................... Aaa/AAA 1,424,555
695,000 4.375%, 08/15/25 MBIA Insured .......................... Aaa/AAA 662,731
RATING
PRINCIPAL MOODY'S/
AMOUNT GENERAL OBLIGATION BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
CITY, COUNTY AND STATE (CONTINUED)
Mesquite, Texas
$ 510,000 4.625%, 02/15/22 FSA Insured ........................... Aaa/AAA $ 513,065
Nevada State
965,000 4.500%, 08/01/21 FSA Insured ........................... Aaa/AAA 965,483
San Antonio, Texas
125,000 4.750%, 02/01/24 FSA Insured ........................... Aaa/AAA 126,275
San Patricio County, Texas
450,000 4.600%, 04/01/25 AMBAC Insured ......................... Aaa/NR 446,737
Spokane County, Washington
420,000 4.500%, 12/01/23 MBIA Insured .......................... Aaa/AAA 417,577
Waco, Texas
2,560,000 4.500%, 02/01/24 MBIA Insured .......................... Aaa/AAA 2,504,320
Washington County, Utah
1,250,000 5.000%, 10/01/22 MBIA Insured .......................... Aaa/NR 1,289,975
Washington State
3,315,000 4.500%, 01/01/22 MBIA Insured ++ ....................... Aaa/AAA 3,294,049
705,000 4.500%, 07/01/23 FSA Insured ........................... Aaa/AAA 697,865
Williamson County, Texas
460,000 4.500%, 02/15/26 FSA Insured ........................... Aaa/AAA 441,480
----------------
Total City, County and State ........................... 24,330,937
----------------
SCHOOL DISTRICT (13.0%)
Borger, Texas Independent School District
400,000 4.500%, 02/15/24 ....................................... NR/AAA 391,280
500,000 4.500%, 02/15/25 ....................................... NR/AAA 484,595
Canutillo, Texas Independent School District
500,000 4.500%, 08/15/25 ....................................... NR/AAA 484,315
Clint, Texas
265,000 4.250%, 02/15/28 ....................................... NR/AAA 243,397
Dallas, Texas Independent School District
2,500,000 5.000%, 08/15/29 ....................................... Aaa/AAA 2,570,625
Davis County, Utah School District
675,000 5.150%, 06/01/17 (pre-refunded) ........................ Aaa/NR 709,546
Dripping Springs, Texas
725,000 4.375%, 08/15/22 ....................................... Aaa/AAA 712,769
RATING
PRINCIPAL MOODY'S/
AMOUNT GENERAL OBLIGATION BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
SCHOOL DISTRICT (CONTINUED)
Eagle Mountain & Saginaw, Texas Independent
School District
$ 300,000 4.750%, 08/15/21 ....................................... Aaa/AAA $ 305,037
525,000 4.750%, 08/15/23 ....................................... Aaa/AAA 531,321
Freemont County, Wyoming School District # 14
355,000 4.500%, 06/15/26 ....................................... NR/BBB 331,882
Frisco, Texas Independent School District
1,260,000 5.000%, 07/15/26 ....................................... Aaa/NR 1,295,293
Galena Park, Texas Independent School District
295,000 4.625%, 08/15/25 ....................................... Aaa/NR 291,953
Harrisburg, South Dakota Independent School
District No. 41-2
1,370,000 4.500%, 01/15/24 FSA Insured ........................... NR/AAA 1,335,654
Iron County, Utah School District
1,375,000 4.000%, 01/15/18 ....................................... Aaa/NR 1,320,275
1,260,000 5.000%, 01/15/21 ....................................... Aaa/NR 1,322,395
Jacksboro, Texas Independent School District
815,000 4.700%, 02/15/23 ....................................... NR/AAA 822,783
La Feria, Texas Independent School District
210,000 4.400%, 02/15/24 ....................................... Aaa/NR 203,017
Lancaster, Texas School District
300,000 4.375%, 02/15/22 ....................................... Aaa/AAA 293,487
Lindale, Texas Independent School District
440,000 4.250%, 02/15/21 ....................................... NR/AAA 426,699
1,000,000 4.250%, 02/15/22 ....................................... NR/AAA 965,090
445,000 4.375%, 02/15/23 ....................................... NR/AAA 432,949
Lovejoy, Texas Independent School District
200,000 4.500%, 02/15/24 ....................................... Aaa/AAA 195,640
Muleshoe, Texas Independent School District
380,000 4.500%, 02/15/22 ....................................... NR/AAA 370,838
250,000 4.500%,0 2/15/23 ....................................... NR/AAA 242,617
200,000 4.500%, 02/15/24 ....................................... NR/AAA 193,398
220,000 4.500%, 02/15/25 ....................................... NR/AAA 211,950
Navasota, Texas Independent School District
475,000 5.000%, 08/15/23 FGIC Insured .......................... Aaa/NR 490,171
RATING
PRINCIPAL MOODY'S/
AMOUNT GENERAL OBLIGATION BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
SCHOOL DISTRICT (CONTINUED)
North Summit County, Utah School District
$ 760,000 5.000%, 02/01/23 ....................................... Aaa/NR $ 792,125
800,000 5.000%, 02/01/24 ....................................... Aaa/NR 831,832
Prosper, Texas Independent School District
395,000 4.125%, 08/15/21 ....................................... NR/AAA 377,644
Southern, Texas Independent School District
910,000 4.500%, 02/01/26 ....................................... Aaa/AAA 878,833
Spring, Texas Independent School District
300,000 4.750%, 08/15/23 ....................................... Aaa/AAA 303,636
1,400,000 4.500%, 08/15/27 ....................................... Aaa/AAA 1,346,142
Tooele County, Utah School District
670,000 4.000%, 06/01/20 ....................................... Aaa/AAA 629,030
Van, Texas Independent School District
750,000 4.875%, 02/15/26 ....................................... Aaa/AAA 764,093
Washington County, Utah
440,000 5.000%, 10/01/18 XLCA Insured .......................... Aaa/NR 459,791
465,000 5.000%, 10/01/19 XLCA Insured .......................... Aaa/NR 485,032
490,000 5.000%, 10/01/20 XLCA Insured .......................... Aaa/NR 510,492
510,000 5.000%, 10/01/21 XLCA Insured .......................... Aaa/NR 530,364
535,000 5.000%, 10/01/22 XLCA Insured .......................... Aaa/NR 554,346
565,000 5.000%, 10/01/23 XLCA Insured .......................... Aaa/NR 583,662
320,000 5.000%, 10/01/24 XLCA Insured .......................... Aaa/NR 330,570
Washoe County, Nevada School District
200,000 4.625%, 06/01/23 FGIC Insured .......................... Aaa/AAA 201,172
Waxahachie, Texas Independent School District
605,000 4.400%, 08/15/26 ....................................... Aaa/NR 572,747
630,000 4.400%, 08/15/27 ....................................... Aaa/NR 593,813
Weber County, Utah School District
750,000 5.000%, 06/15/18 ....................................... Aaa/NR 779,040
Yakima County, Washington School District #208
750,000 4.500%, 12/01/23 FSA Insured ........................... Aaa/NR 725,453
----------------
Total School District .................................. 29,428,793
----------------
Total General Obligation Bonds ......................... 53,759,730
----------------
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (75.8%) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
AIRPORT (1.6%)
Clark County, Nevada Passenger Facility Charge
$ 255,000 4.750%, 07/01/22 MBIA Insured AMT ...................... Aaa/AAA $ 257,188
Hillsborough County, Florida Aviation Authority
2,185,000 5.250%, 10/01/23 MBIA Insured AMT ...................... Aaa/AAA 2,259,902
Miami-Dade County, Florida Aviation Revenue
1,185,000 5.000%, 10/01/28 Series C MBIA Insured AMT ............. Aaa/AAA 1,196,542
----------------
Total Airport .......................................... 3,713,632
----------------
COUNTY (0.5%)
Davis County, Utah Lease Revenue DMV Project
78,000 5.400%, 11/01/17 ....................................... NR/NR* 78,052
83,000 5.450%, 11/01/18 ....................................... NR/NR* 83,054
87,000 5.500%, 11/01/19 ....................................... NR/NR* 87,055
92,000 5.550%, 11/01/20 ....................................... NR/NR* 92,058
97,000 5.600%, 11/01/21 ....................................... NR/NR* 97,058
103,000 5.650%, 11/01/22 ....................................... NR/NR* 103,064
108,000 5.700%, 11/01/23 ....................................... NR/NR* 108,072
115,000 5.700%, 11/01/24 ....................................... NR/NR* 115,078
121,000 5.750%, 11/01/25 ....................................... NR/NR* 121,074
128,000 5.750%, 11/01/26 ....................................... NR/NR* 128,069
----------------
Total County ........................................... 1,012,634
----------------
EDUCATION (13.1%)
Broward County, Florida School Board COP
1,680,000 4.500%, 07/01/23 Series A FGIC Insured ................. Aaa/AAA 1,649,928
Carmel, Indiana 2002 School Building Corp.
1,235,000 4.300%, 01/15/23 FSA Insured ........................... NR/AAA 1,183,142
1,525,000 4.300%, 07/15/23 FSA Insured ........................... NR/AAA 1,459,730
Clinton Prairie, Indiana Community School Building
675,000 4.625%, 01/15/19 FGIC Insured .......................... Aaa/AAA 686,542
Florida State Board of Education Public Education
210,000 4.500%, 06/01/25 FSA Insured ........................... Aaa/AAA 204,945
Hillsborough County, Florida School Board COP
560,000 4.250%, 07/01/26 MBIA Insured .......................... Aaa/AAA 516,886
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
EDUCATION (CONTINUED)
Laredo, Texas Independent School District Public
Facility Corp.
$ 190,000 5.000%, 08/01/24 AMBAC Insured ......................... Aaa/AAA $ 194,986
Nevada System Higher Education COP
1,000,000 5.000%, 07/01/25 AMBAC Insured ......................... Aaa/AAA 1,037,090
Salt Lake County, Utah Westminster College Project
115,000 5.050%, 10/01/10 (pre-refunded) ........................ NR/BBB 118,882
100,000 5.500%, 10/01/19 (pre-refunded) ........................ NR/BBB 104,331
435,000 4.750%, 10/01/21 ....................................... NR/BBB 428,775
1,200,000 5.000%, 10/01/22 ....................................... NR/BBB 1,206,348
1,250,000 5.000%, 10/01/25 ....................................... NR/BBB 1,250,738
1,000,000 5.750%, 10/01/27 (pre-refunded) ........................ NR/BBB 1,014,460
Texas State College Student Loan Revenue
100,000 5.000%, 08/01/22 AMT ................................... Aa1/AA 101,502
Texas State University System Financing Revenue
655,000 4.375%, 03/15/23 FSA Insured ........................... Aaa/AAA 631,512
Tyler, Texas Independent School District
325,000 5.000%, 02/15/26 FSA Insured ........................... Aaa/AAA 334,727
University of Nevada (University Revenues)
190,000 4.500%, 07/01/24 MBIA Insured .......................... Aaa/AAA 189,552
University of Utah COP
3,170,000 4.350%, 12/01/26 AMBAC Insured ......................... Aaa/AAA 2,965,377
University of Utah (University Revenues)
770,000 5.000%, 04/01/18 MBIA Insured .......................... Aaa/AAA 807,183
Utah County, Utah Charter School Revenue
Lakeview Academy
315,000 5.350%, 07/15/17 Series A .............................. NR/NR* 314,751
Utah County, Utah Charter School Revenue
Lincoln Academy
450,000 5.450%, 06/15/17 Series A + ............................ NR/NR* 451,697
Utah County, Utah Charter School Revenue
Renaissance Academy
340,000 5.350%, 07/15/17 Series A .............................. NR/NR* 337,912
Utah County, Utah School Facility
1,400,000 6.500%, 12/01/25 ....................................... NR/NR* 1,400,560
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
EDUCATION (CONTINUED)
Utah State Board of Regents Auxiliary &
Campus Facility
$ 1,000,000 4.125%, 04/01/20 MBIA Insured .......................... Aaa/AAA $ 950,490
Utah State Board of Regents Dixie State College
120,000 5.500%, 05/01/14 MBIA Insured .......................... Aaa/AAA 128,087
130,000 5.500%, 05/01/15 MBIA Insured .......................... Aaa/AAA 138,644
400,000 5.100%, 05/01/21 MBIA Insured .......................... Aaa/AAA 412,900
Utah State Board of Regents Lease Revenue
410,000 4.500%, 05/01/20 AMBAC Insured ......................... Aaa/AAA 411,460
425,000 4.500%, 05/01/21 AMBAC Insured ......................... Aaa/AAA 425,281
450,000 4.625%, 05/01/22 AMBAC Insured ......................... Aaa/AAA 453,056
120,000 4.650%, 05/01/23 AMBAC Insured ......................... Aaa/AAA 120,770
Utah State Board of Regents Office Facility Revenue
450,000 5.050%, 02/01/20 MBIA Insured .......................... Aaa/AAA 463,109
360,000 5.125%, 02/01/22 MBIA Insured .......................... Aaa/AAA 371,743
Utah State Board of Regents
2,885,000 4.500%, 08/01/18 MBIA Insured .......................... Aaa/AAA 2,900,435
250,000 5.250%, 04/01/24 MBIA Insured .......................... Aaa/AAA 267,675
500,000 5.000%, 05/01/26 ....................................... Aa/AAA 516,170
Utah State Board of Regents (University of Utah)
1,045,000 5.000%, 04/01/23 MBIA Insured .......................... Aaa/AAA 1,080,133
Weber State University, Utah
1,825,000 4.400%, 04/01/27 FSA Insured ........................... NR/AAA 1,730,191
Weber State University, Utah Student Facilities System
300,000 5.100%, 04/01/16 Series A .............................. NR/AA 313,563
425,000 5.250%, 04/01/19 Series A .............................. NR/AA 446,684
----------------
Total Education ........................................ 29,721,947
----------------
HEALTHCARE (0.4%)
Harris County, Texas Health Facility Development Corp.
145,000 5.000%, 11/15/28 AMBAC Insured ......................... NR/AAA 146,869
Lee Memorial Health System, Florida
Hospital Revenue
450,000 4.250%, 04/01/22 MBIA Insured .......................... Aaa/AAA 428,472
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
HEALTHCARE (CONTINUED)
Tarrant County, Texas Health Facilities Revenue
$ 225,000 5.000%, 02/15/26 MBIA Insured (pre-refunded) ........... Aaa/AAA $ 228,861
----------------
Total Healthcare ....................................... 804,202
----------------
HOUSING (11.0%)
Alaska Housing Finance Corp. Housing Revenue
1,000,000 4.700%, 06/01/27 AMT ................................... Aa2/AA 964,850
Florida Housing Finance Corp. Revenue
435,000 4.750%, 01/01/16 AMT ................................... Aa2/AA 438,323
790,000 5.000%, 07/01/21 AMT ................................... Aa2/AA 796,517
1,610,000 4.550%, 07/01/22 AMT ................................... Aa1/AA 1,563,970
Henderson, Nevada Local Improvement District
150,000 5.000%, 09/01/15 ....................................... NR/NR* 153,214
200,000 5.000%, 09/01/16 ....................................... NR/NR* 204,260
200,000 5.050%, 09/01/17 ....................................... NR/NR* 203,808
200,000 5.100%, 09/01/18 ....................................... NR/NR* 204,256
Indiana Housing & Community Development Authority
1,485,000 4.900%, 07/01/26 AMT ................................... Aaa/NR 1,477,724
Indiana State Housing Finance Authority
Single Family
245,000 4.850%, 07/01/22 AMT ................................... Aaa/NR 244,740
Indianapolis, Indiana Multi-Family
500,000 4.850%, 01/01/21 AMT ................................... Aaa/NR 502,625
Miami-Dade County, Florida Housing
Finance Authority
535,000 5.000%, 11/01/23 FSA Insured AMT ....................... NR/AAA 539,580
Nevada Housing Multi-Family LOC US Bank
1,000,000 4.750%, 04/01/39 AMT ................................... NR/AA 978,050
Orange County, Florida Housing Finance Authority
205,000 5.150%, 03/01/22 ....................................... Aaa/NR 207,023
Provo City, Utah Housing Authority
500,000 5.800%, 07/20/22 GNMA Collateralized ................... Aaa/NR 509,020
Seattle, Washington Housing Authority
730,000 4.400%, 11/01/21 AMT ................................... NR/AAA 702,895
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
HOUSING (CONTINUED)
Snohomish County, Washington Housing Authority
$ 185,000 4.875%, 09/01/12 AMT ................................... NR/NR* $ 184,863
225,000 5.000%, 09/01/13 AMT ................................... NR/NR* 225,576
185,000 5.000%, 09/01/14 AMT ................................... NR/NR* 185,098
145,000 5.100%, 09/01/15 AMT ................................... NR/NR* 145,565
South Dakota Housing Development Authority
1,250,000 4.900%, 05/01/26 AMT ................................... Aa1/AAA 1,243,838
Texas State Housing Revenue
500,000 4.800%, 09/01/27 AMT ................................... Aa1/AAA 486,120
Utah Housing Corporation Single Family Housing
250,000 4.000%, 07/01/11 AMT ................................... Aaa/AAA 245,755
55,000 5.250%, 07/01/23 AMT ................................... Aa2/AA 55,513
650,000 5.000%, 01/01/32 AMT ................................... Aa2/AA 649,084
Utah Housing Corporation Single Family Mortgage
230,000 4.000%, 07/01/11 AMT ................................... Aaa/AAA 227,491
335,000 4.600%, 07/01/15 AMT ................................... Aaa/AAA 336,474
240,000 4.650%, 07/01/16 AMT ................................... Aaa/AAA 241,356
245,000 4.875%, 07/01/23 AMT ................................... Aa3/AA- 242,185
1,245,000 5.000%, 07/01/25 AMT ................................... Aa3/AA- 1,248,548
820,000 5.100%, 01/01/26 AMT ................................... Aa3/AA- 826,896
975,000 5.000%, 07/01/31 AMT ................................... Aa2/AA 976,804
Utah State Housing Agency Housing Revenue
135,000 5.650%, 07/01/27 AMT ................................... Aa2/AA 137,942
Utah State Housing Corporation Single Family
Housing Revenue
1,635,000 5.125%, 07/01/24 AMT ................................... Aa3/AA- 1,660,751
Utah State Housing Finance Agency
225,000 5.700%, 07/01/15 AMT ................................... Aa3/AA- 228,508
120,000 5.650%, 07/01/16 Series 1994C .......................... Aaa/AAA 120,812
40,000 5.400%, 07/01/16 AMT ................................... Aa2/AA 40,206
60,000 6.000%, 07/01/17 AMT ................................... Aaa/AA 60,610
740,000 5.500%, 07/01/18 AMT ................................... Aa3/AA- 755,954
75,000 5.300%, 07/01/18 AMT ................................... Aaa/AAA 77,138
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
HOUSING (CONTINUED)
Utah State Housing Finance Agency (continued)
$ 90,000 5.000%, 07/01/18 AMT ................................... Aaa/AAA $ 90,694
145,000 5.400%, 07/01/20 AMT ................................... Aa2/AA 147,074
360,000 5.600%, 07/01/23 AMT ................................... Aa2/AA 364,979
75,000 5.700%, 07/01/26 MBIA Insured .......................... Aaa/AAA 75,029
Washington State Housing Finance Commission
2,290,000 4.800%, 12/01/21 AMT ................................... Aaa/NR 2,268,772
Wyoming Community Development Authority
Housing Revenue
150,000 4.600%, 12/01/12 AMT ................................... Aa1/AA+ 150,582
225,000 4.350%, 12/01/16 AMT ................................... Aa1/AA+ 221,074
580,000 4.700%, 06/01/17 AMT ................................... Aa1/AA+ 584,176
520,000 4.700%, 12/01/17 AMT ................................... Aa1/AA+ 523,744
120,000 5.000%, 12/01/22 ....................................... Aa1/AA+ 121,468
----------------
Total Housing .......................................... 24,841,534
----------------
INDUSTRIAL DEVELOPMENT & POLLUTION CONTROL (0.5%)
Sandy City, Utah Industrial Development, H Shirley
Wright Project, Refunding Bonds,
LOC Olympus Bank
250,000 6.125%, 08/01/16 ....................................... NR/AAA 250,420
Utah County Environmental Improvement Revenue
935,000 5.050%, 11/01/17 ....................................... Baa1/BBB+ 966,136
----------------
Total Industrial Development & Pollution Control ....... 1,216,556
----------------
LEASE (8.9%)
Celebration Community Development
District, Florida
290,000 5.000%, 05/01/22 MBIA Insured .......................... Aaa/AAA 299,286
Clark County, Nevada Improvement District Revenue
740,000 5.125%, 12/01/19 ....................................... NR/NR* 747,755
Clark County, Nevada Improvement District Special
Local Improvement # 128 (Summerlin)
500,000 5.000%, 02/01/21Series A ............................... NR/NR* 493,680
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
LEASE (CONTINUED)
Marion County, Indiana Convention & Recreational
Facilities Authority
$ 390,000 5.000%, 06/01/27 MBIA Insured .......................... Aaa/AAA $ 394,286
Murray City, Utah Municipal Building Authority
520,000 5.050%, 12/01/15 AMBAC Insured ......................... Aaa/NR 543,332
New Albany, Indiana Development Authority
500,000 4.250%, 02/01/22 ....................................... NR/A- 461,750
Red River, Texas Higher Education TCU Project
1,000,000 4.375%, 03/15/25 ....................................... Aa3/NR 936,980
Salt Lake County, Utah Municipal Building Authority
3,900,000 5.200%, 10/15/20 AMBAC Insured (pre-refunded) .......... Aaa/AAA 4,093,050
South Dakota State Building Authority Revenue
500,000 4.500%, 06/01/24 FGIC Insured NR/AAA 490,120
Spanish Fork, Utah Charter School
2,000,000 5.550%, 11/15/21 ....................................... NR/NR* 2,033,140
Springville, Utah
34,000 5.650%, 01/15/18 ....................................... NR/NR* 34,020
37,000 5.800%, 01/15/19 ....................................... NR/NR* 37,020
38,000 5.900%, 01/15/20 ....................................... NR/NR* 38,022
40,000 6.000%, 01/15/21 ....................................... NR/NR* 40,026
Utah County, Utah Municipal Building Authority
120,000 5.500%, 11/01/16 AMBAC Insured ......................... Aaa/NR 127,415
240,000 5.500%, 11/01/17 AMBAC Insured ......................... Aaa/NR 254,830
Utah State Building Ownership Authority
465,000 5.000%, 05/15/21 ....................................... Aa1/AA+ 483,879
1,755,000 5.250%, 05/15/23 ....................................... Aa1/AA+ 1,842,417
510,000 5.000%, 05/15/23 ....................................... Aa1/AA+ 528,437
1,845,000 5.250%, 05/15/24 ....................................... Aa1/AA+ 1,934,685
1,080,000 5.000%, 05/15/25 ....................................... Aa1/AA+ 1,112,152
Washington County - St. George, Utah Interlocal
Agency Revenue
1,000,000 5.125%, 12/01/17 AMBAC Insured ......................... NR/AAA 1,014,580
100,000 5.125%, 12/01/22 AMBAC Insured ......................... NR/AAA 101,405
West Bountiful, Utah Courthouse Revenue
410,000 5.000%, 05/01/19 NR/A- 427,462
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
LEASE (CONTINUED)
West Valley City, Utah Municipal Building Authority
Lease Revenue Refunding
$ 1,890,000 4.375%, 08/01/26 Series A FGIC Insured ................. Aaa/AAA $ 1,803,967
----------------
Total Lease ............................................ 20,273,696
----------------
TAX REVENUE (19.5%)
Bay County, Florida Sales Tax Revenue
175,000 4.750%, 09/01/23 FSA Insured ........................... Aaa/NR 175,878
Bluffdale City, Utah Series 2004
295,000 6.000%, 12/01/13 ....................................... NR/NR* 299,832
310,000 6.000%, 12/01/14 ....................................... NR/NR* 315,533
330,000 6.000%, 12/01/15 ....................................... NR/NR* 330,323
350,000 6.000%, 12/01/16 ....................................... NR/NR* 350,329
370,000 6.000%, 12/01/17 NR/NR* 370,318
395,000 6.000%, 12/01/18 ....................................... NR/NR* 395,308
420,000 6.000%, 12/01/19 ....................................... NR/NR* 420,294
Bluffdale, Utah Sales Tax Revenue
1,975,000 5.500%, 08/01/23 ....................................... NR/NR* 1,999,925
Bountiful, Utah Special Improvement District
Special Assessment Revenue
203,000 5.000%, 06/01/14 ....................................... NR/NR* 202,405
213,000 5.150%, 06/01/15 ....................................... NR/NR* 213,030
224,000 5.300%, 06/01/16 ....................................... NR/NR* 224,038
236,000 5.500%, 06/01/17 ....................................... NR/NR* 236,142
249,000 5.650%, 06/01/18 NR/NR* 249,219
Cache County, Utah Sales Tax Revenue
855,000 5.000%, 12/15/19 FGIC Insured .......................... Aaa/AAA 896,869
Clark County, Nevada Improvement District
250,000 5.000%, 08/01/16 ....................................... NR/NR* 254,565
Coral Canyon, Utah Special Service District
110,000 5.000%, 07/15/13 ....................................... NR/NR* 112,077
250,000 5.500%, 07/15/18 NR/NR* 257,350
Fishers, Indiana Redevelopment Authority
Lease Revenue
175,000 4.500%, 07/15/20 AMBAC Insured ......................... Aaa/AAA 175,639
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
TAX REVENUE (CONTINUED)
Henderson, Nevada Local Improvement District
$ 100,000 4.500%, 09/01/12 ....................................... NR/NR* $ 99,404
300,000 5.000%, 09/01/14 ....................................... NR/NR* 304,851
300,000 5.000%, 09/01/15 ....................................... NR/NR* 303,789
Holladay, Utah Redevelopment Agency
3,000,000 4.900%, 12/30/20 NR/NR* 2,972,880
Jordanelle, Utah Special Service District
186,000 5.000%, 11/15/14 ....................................... NR/NR* 186,839
196,000 5.100%, 11/15/15 ....................................... NR/NR* 197,088
206,000 5.200%, 11/15/16 ....................................... NR/NR* 207,061
216,000 5.300%, 11/15/17 ....................................... NR/NR* 217,138
228,000 5.400%, 11/15/18 ....................................... NR/NR* 229,261
240,000 5.500%, 11/15/19 ....................................... NR/NR* 241,325
253,000 5.600%, 11/15/20 ....................................... NR/NR* 254,361
268,000 5.700%, 11/15/21 ....................................... NR/NR* 269,439
283,000 5.800%, 11/15/22 ....................................... NR/NR* 284,520
299,000 6.000%, 11/15/23 ....................................... NR/NR* 300,639
Jordanelle, Utah Special Service Improvement District
275,000 8.000%, 10/01/11 ....................................... NR/NR* 284,710
La Verkin, Utah Sales and Franchise Tax Revenue
571,000 5.100%, 07/15/27 ....................................... NR/NR* 582,106
Lehi, Utah Sales Tax
610,000 5.000%, 06/01/21 FSA Insured ........................... Aaa/AAA 634,516
790,000 5.000%, 06/01/24 FSA Insured ........................... Aaa/AAA 816,504
Mesquite, Nevada New Special Improvement District
185,000 4.600%, 08/01/11 ....................................... NR/NR* 184,384
195,000 4.750%, 08/01/12 ....................................... NR/NR* 193,779
230,000 4.900%, 08/01/13 ....................................... NR/NR* 229,395
140,000 5.250%, 08/01/17 ....................................... NR/NR* 140,267
315,000 5.350%, 08/01/19 ....................................... NR/NR* 315,598
135,000 5.400%, 08/01/20 ....................................... NR/NR* 135,432
500,000 5.500%, 08/01/25 ....................................... NR/NR* 501,590
Mountain Regional Water District, Utah
Special Assessment
1,800,000 7.000%, 12/01/18 ....................................... NR/NR* 1,835,910
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
TAX REVENUE (CONTINUED)
Mountain Regional Water, Utah Special Service District
$ 2,000,000 5.000%, 12/15/20 MBIA Insured .......................... Aaa/AAA $ 2,073,460
North Ogden, Utah Sales Tax Revenue
195,000 5.000%, 11/01/24 XLCA Insured .......................... Aaa/AAA 200,891
Payson City Utah Sales Tax Revenue
445,000 5.000%, 08/01/21 FSA Insured NR/AAA 463,427
Plainfield, Indiana Independent Redevelopment
Authority
1,070,000 4.375%, 08/01/20 CIFG Assurance North America,
Inc. Insured ........................................ Aaa/NR 1,048,568
Salt Lake City, Utah Sales Tax
265,000 5.250%, 02/01/13 ....................................... NR/AAA 278,594
1,320,000 5.250%, 02/01/15 ....................................... NR/AAA 1,382,660
100,000 5.250%, 02/01/17 ....................................... NR/AAA 104,578
Salt Lake County, Utah Sales Tax
955,000 5.000%, 02/01/21 ....................................... NR/AAA 995,282
1,725,000 5.000%, 08/01/21 ....................................... NR/AAA 1,801,780
1,005,000 5.000%, 02/01/22 ....................................... NR/AAA 1,045,411
1,060,000 5.000%, 02/01/23 ....................................... NR/AAA 1,100,545
1,115,000 5.000%, 02/01/24 ....................................... NR/AAA 1,156,199
Sandy City, Utah Sales Tax
520,000 5.000%, 09/15/18 AMBAC Insured ......................... Aaa/AAA 537,243
605,000 5.000%, 09/15/20 AMBAC Insured ......................... Aaa/AAA 623,356
South Jordan, Utah Sales Tax
570,000 5.000%, 08/15/15 AMBAC Insured ......................... Aaa/AAA 592,920
South Jordan, Utah Special Assignment
1,000,000 6.875%, 11/01/17 ....................................... NR/NR* 1,015,240
South Weber City, Utah
525,000 5.000%, 01/15/24 MBIA Insured .......................... Aaa/AAA 540,897
Springville, Utah Special Improvement District
400,000 5.500%, 01/15/17 ....................................... NR/NR* 400,220
423,000 5.650%, 01/15/18 ....................................... NR/NR* 423,254
446,000 5.800%, 01/15/19 ....................................... NR/NR* 446,241
472,000 5.900%, 01/15/20 ....................................... NR/NR* 472,278
500,000 6.000%, 01/15/21 ....................................... NR/NR* 500,320
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
TAX REVENUE (CONTINUED)
Utah Water Finance Agency
$ 775,000 5.100%, 07/01/18 AMBAC Insured ......................... Aaa/NR $ 806,093
510,000 5.000%, 07/01/18 AMBAC Insured ......................... Aaa/NR 529,487
685,000 5.000%, 07/01/19 AMBAC Insured ......................... Aaa/NR 711,174
Wasatch County, Utah Building Authority
130,000 5.000%, 10/01/15 ....................................... A3/NR 133,067
135,000 5.000%, 10/01/16 ....................................... A3/NR 137,890
Wasatch County, Utah Sales Tax
205,000 5.000%, 12/01/16 AMBAC Insured ......................... Aaa/AAA 213,555
210,000 5.000%, 12/01/17 AMBAC Insured ......................... Aaa/AAA 217,938
225,000 5.000%, 12/01/18 AMBAC Insured ......................... Aaa/AAA 232,736
Washington City, Utah Sales Tax
680,000 5.250%, 11/15/17 AMBAC Insured ......................... Aaa/AAA 721,018
Weber County, Utah Sales Tax
385,000 5.000%, 07/01/23 AMBAC Insured ......................... Aaa/NR 396,839
West Valley City, Utah Redevelopment Agency
1,625,000 5.000%, 03/01/21 ....................................... NR/A- 1,656,996
320,000 5.000%, 03/01/22 ....................................... NR/A- 325,680
350,000 5.000%, 03/01/23 NR/A- 355,541
1,000,000 5.000%, 03/01/24 ....................................... NR/A- 1,014,540
West Valley City, Utah Sales Tax
250,000 5.000%, 07/15/20 AMBAC Insured ......................... Aaa/AAA 257,948
----------------
Total Tax Revenue ...................................... 44,315,726
----------------
TRANSPORTATION (3.6%)
Florida State Turnpike Authority Turnpike Revenue
500,000 4.500%, 07/01/22 MBIA Insured .......................... Aaa/AAA 502,080
Port of Seattle, Washington Revenue
655,000 5.100%, 04/01/24 AMT FGIC Insured ...................... Aaa/AAA 660,659
Utah Transit Authority Sales Tax & Transportation
Revenue
3,300,000 4.125%, 06/15/21 FSA Insured ........................... Aaa/AAA 3,192,717
3,450,000 4.125%, 06/15/22 FSA Insured ........................... Aaa/AAA 3,265,632
590,000 5.000%, 06/15/24 FSA Insured ........................... Aaa/AAA 618,892
----------------
Total Transportation ................................... 8,239,980
----------------
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
UTILITY (10.0%)
Alaska Industrial Development & Export Authority
$ 400,000 4.625%, 12/01/16 AMBAC Insured AMT ..................... NR/AAA $ 401,804
Cowlitz County, Washington Public Utility District
Electric Revenue
1,000,000 4.500%, 09/01/26 MBIA Insured .......................... Aaa/AAA 969,950
Eagle Mountain, Utah Gas & Electric
1,385,000 4.250%, 06/01/20 Radian Insured ........................ Aa3/AA 1,314,143
1,440,000 5.000%, 06/01/21 Radian Insured ........................ Aa3/AA 1,469,146
1,515,000 5.000%, 06/01/22 Radian Insured ........................ Aa3/AA 1,542,649
Garland, Texas Water & Sewer
440,000 4.500%, 03/01/21 AMBAC Insured ......................... Aaa/AAA 438,200
Indianapolis, Indiana Gas Utility
290,000 5.000%, 08/15/24 AMBAC Insured ......................... Aaa/AAA 291,885
Intermountain Power Agency Utilities Light &
Power Service, Utah
775,000 5.000%, 07/01/18 FSA Insured ........................... Aaa/AAA 806,690
1,380,000 5.000%, 07/01/19 MBIA Insured .......................... Aaa/AAA 1,415,383
Lower Colorado River Authority, Texas
175,000 5.000%, 05/15/26 FSA Insured ........................... Aaa/AAA 179,056
Manti City, Utah Electric System Revenue
603,000 5.750%, 02/01/17 ....................................... NR/NR* 625,444
Murray City, Utah Utility Electric Revenue
1,340,000 5.000%, 06/01/25 AMBAC Insured ......................... Aaa/NR 1,385,761
Rockport, Indiana Pollution Control Revenue
Indiana Michigan Power Company Project
1,000,000 4.625%, 06/01/25 Series A FGIC Insured ................. Aaa/AAA 983,810
St. George, Utah Electric Revenue
1,910,000 4.500%, 06/01/20 FSA Insured ........................... Aaa/NR 1,916,227
Salem, Utah Electric Revenue
125,000 5.300%, 11/01/07 ....................................... NR/NR* 125,180
130,000 5.350%, 11/01/08 NR/NR* 131,095
140,000 5.400%, 11/01/09 NR/NR* 141,448
Santa Clara Utah Storm Drain Revenue
877,000 5.100%, 09/15/26 NR/NR* 890,348
Seattle, Washington Municipal Light & Power
1,360,000 4.500%, 08/01/19 FSA Insured ........................... Aaa/AAA 1,366,501
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
UTILITY (CONTINUED)
Southern Utah Valley Power System
$ 210,000 5.250%, 09/15/13 MBIA Insured .......................... Aaa/AAA $ 221,787
225,000 5.250%, 09/15/14 MBIA Insured .......................... Aaa/AAA 238,601
235,000 5.250%, 09/15/15 MBIA Insured .......................... Aaa/AAA 249,093
185,000 5.125%, 09/15/21 MBIA Insured .......................... Aaa/AAA 192,200
Springville, Utah Electric Revenue
550,000 5.600%, 03/01/09 ....................................... Baa1/NR 559,686
Tacoma, Washington Solid Waste Utility Revenue
1,000,000 5.000%, 12/01/23 XLCA Insured .......................... Aaa/AAA 1,037,180
Utah Assessed Municipal Power System
790,000 5.250%, 12/01/09 ....................................... NR/A- 803,872
1,000,000 5.000%, 04/01/21 FSA Insured ........................... Aaa/AAA 1,032,630
Utah Water Finance Agency Revenue
1,000,000 4.500%, 10/01/28 AMBAC Insured ......................... Aaa/NR 957,690
Washington, Utah Electric Revenue
985,000 5.000%, 09/01/21 XLCA Insured .......................... Aaa/NR 1,020,884
----------------
Total Utility .......................................... 22,708,343
----------------
WATER AND SEWER (6.7%)
Ashley Valley, Utah
40,000 9.500%, 01/01/08 AMBAC Insured ......................... Aaa/AAA 41,102
Eagle Mountain, Utah Water and Sewer
750,000 5.800%, 11/15/16 ACA Insured ........................... NR/A 779,842
Granger and Hunter, Utah Improvement District
350,000 5.000%, 03/01/18 FSA Insured (pre-refunded) ............ Aaa/NR 352,835
Jordan Valley, Utah Water Conservancy District
715,000 4.375%, 10/01/18 AMBAC Insured ......................... Aaa/AAA 712,133
Mesquite, Texas Waterworks & Sewer
225,000 4.500%, 03/01/24 FSA Insured ........................... Aaa/AAA 219,321
Murray City, Utah Sewer and Water
465,000 5.000%, 10/01/17 AMBAC Insured ......................... Aaa/NR 484,944
390,000 5.000%, 10/01/18 AMBAC Insured ......................... Aaa/NR 405,206
440,000 5.000%, 10/01/19 AMBAC Insured ......................... Aaa/NR 456,425
North Davis County, Utah Sewer District
1,350,000 5.000%, 03/01/21 AMBAC Insured ......................... Aaa/NR 1,400,166
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
WATER AND SEWER (CONTINUED)
Orem, Utah Water & Storm Sewer Revenue
$ 1,720,000 4.500%, 07/15/17 MBIA Insured .......................... Aaa/AAA $ 1,740,795
Pleasant Grove, Utah Water Revenue
450,000 4.300%, 12/01/20 MBIA Insured .......................... Aaa/AAA 436,585
Salt Lake City, Utah Metropolitan Water Revenue
1,200,000 5.375%, 07/01/24 AMBAC Insured (pre-refunded) .......... Aaa/AAA 1,235,412
125,000 5.375%, 07/01/29 AMBAC Insured (pre-refunded) .......... Aaa/AAA 128,689
South Valley, Utah Water Reclamation Facility
710,000 4.375%, 08/15/18 ....................................... NR/AAA 707,188
Smithfield, Utah Water Revenue
90,000 4.750%, 06/01/17 ....................................... NR/NR* 89,631
94,000 4.800%, 06/01/18 ....................................... NR/NR* 93,594
99,000 4.850%, 06/01/19 ....................................... NR/NR* 98,368
103,000 4.900%, 06/01/20 ....................................... NR/NR* 102,305
108,000 5.000%, 06/01/21 ....................................... NR/NR* 107,236
114,000 5.050%, 06/01/22 ....................................... NR/NR* 113,169
120,000 5.100%, 06/01/23 ....................................... NR/NR* 119,090
126,000 5.150%, 06/01/24 ....................................... NR/NR* 125,011
132,000 5.200%, 06/01/25 ....................................... NR/NR* 130,931
139,000 5.250%, 06/01/26 ....................................... NR/NR* 137,842
Upper Trinity Regional Water District, Texas
205,000 4.500%, 08/01/20 AMBAC Insured ......................... Aaa/AAA 204,994
Utah Water Finance Agency Revenue
100,000 5.000%, 06/01/14 MBIA Insured .......................... Aaa/AAA 101,117
200,000 5.250%, 07/01/16 AMBAC Insured ......................... Aaa/NR 210,466
310,000 5.000%, 10/01/17 AMBAC Insured ......................... Aaa/NR 322,716
465,000 5.250%, 10/01/18 AMBAC Insured (pre-refunded) .......... Aaa/NR 492,421
285,000 5.250%, 10/01/18 AMBAC Insured (unrefunded) ............ Aaa/NR 299,387
360,000 5.000%, 10/01/20 AMBAC Insured (pre-refunded) .......... Aaa/NR 377,014
105,000 5.000%, 10/01/20 AMBAC Insured (unrefunded) ............ Aaa/NR 108,575
830,000 4.500%, 10/01/22 AMBAC Insured ......................... Aaa/NR 823,617
100,000 5.125%, 07/01/23 AMBAC Insured ......................... Aaa/NR 103,532
870,000 4.500%, 10/01/23 AMBAC Insured ......................... Aaa/NR 860,065
250,000 5.500%, 10/01/29 AMBAC Insured (pre-refunded) .......... Aaa/AAA 258,915
RATING
PRINCIPAL MOODY'S/
AMOUNT REVENUE BONDS (CONTINUED) S&P VALUE
- --------------- --------------------------------------------------------- -------- ----------------
WATER AND SEWER (CONTINUED)
Weber-Box Elder, Utah Conservation District
Water Revenue
$ 200,000 6.450%, 11/01/14 (pre-refunded) ........................ Baa3/NR $ 215,346
200,000 6.500%, 11/01/19 (pre-refunded) ........................ Baa3/NR 215,654
335,000 6.900%, 11/01/20 (pre-refunded) ........................ Baa3/NR 365,354
----------------
Total Water and Sewer .................................. 15,176,993
----------------
Total Revenue Bonds .................................... 172,025,243
----------------
Total Investments (cost $226,833,830 - note 4) ......... 99.5% 225,784,973
Other assets less liabilities .......................... 0.5 1,138,153
----- ----------------
Net Assets ............................................. 100.0% $ 226,923,126
===== ================
PERCENT OF
PORTFOLIO DISTRIBUTION BY QUALITY RATING (UNAUDITED) PORTFOLIO
-------------------------------------------------------- ---------
Aaa of Moody's or AAA of S&P ........................... 67.8%
Aa of Moody's or AA of S&P ............................. 11.8
A of Moody's or S&P .................................... 2.7
Baa of Moody's or BBB of S&P ........................... 3.0
Not rated* ............................................. 14.7
-----
100.0%
=====
* Any security not rated (NR) by either credit rating service must be
determined by the Manager to have sufficient quality to be ranked in the
top four ratings if a credit rating were to be assigned by a rating
service.
+ Security traded on a "when-issued" basis.
++ This security is pledged as collateral for the Fund's when- issued
commitments.
PORTFOLIO ABBREVIATIONS:
------------------------
ACA - American Capital Assurance Financial Guaranty Corp.
AMBAC - American Municipal Bond Assurance Corp.
AMT - Alternative Minimum Tax
CIFG - CDC IXIS Financial Guaranty
COP - Certificates of Participation
FGIC - Financial Guaranty Insurance Co.
FSA - Financial Security Assurance
GNMA - Government National Mortgage Association
LOC - Letter of Credit
MBIA - Municipal Bond Investors Assurance
NR - Not Rated
XLCA - XL Capital Assurance
See accompanying notes to financial statements.
TAX-FREE FUND FOR UTAH
STATEMENT OF ASSETS AND LIABILITIES
JUNE 30, 2007
ASSETS
Investments at value (cost $226,833,830) .............................................................. $ 225,784,973
Interest receivable ................................................................................... 3,286,687
Receivable for Fund shares sold ....................................................................... 889,356
Other assets .......................................................................................... 15,124
-------------
Total assets .......................................................................................... 229,976,140
-------------
LIABILITIES
Cash overdraft .......................................................................................... 281,371
Payable for Fund shares redeemed ........................................................................ 1,485,991
Payable for investment securities purchased ............................................................. 893,888
Dividends payable ....................................................................................... 175,158
Distribution and service fees payable ................................................................... 50,245
Management fees payable ................................................................................. 37,327
Accrued expenses ........................................................................................ 129,034
-------------
Total liabilities ....................................................................................... 3,053,014
-------------
NET ASSETS ................................................................................................. $ 226,923,126
=============
Net Assets consist of:
Capital Stock - Authorized an unlimited number of shares, par value $0.01 per share ..................... $ 228,862
Additional paid-in capital .............................................................................. 229,412,776
Net unrealized depreciation on investments (note 4) ..................................................... (1,048,857)
Accumulated net realized loss on investments ............................................................ (1,704,433)
Undistributed net investment income ..................................................................... 34,778
-------------
$ 226,923,126
=============
CLASS A
Net Assets .............................................................................................. $ 148,894,165
=============
Capital shares outstanding .............................................................................. 15,025,729
=============
Net asset value and redemption price per share .......................................................... $ 9.91
=============
Offering price per share (100/96 of $9.91 adjusted to nearest cent) ..................................... $ 10.32
=============
CLASS C
Net Assets .............................................................................................. $ 30,905,054
=============
Capital shares outstanding .............................................................................. 3,119,919
=============
Net asset value and offering price per share ............................................................ $ 9.91
=============
Redemption price per share (*a charge of 1% is imposed on the redemption
proceeds of the shares, or on the original price, whichever is lower, if redeemed
during the first 12 months after purchase) ........................................................... $ 9.91*
=============
CLASS Y
Net Assets .............................................................................................. $ 47,123,907
=============
Capital shares outstanding .............................................................................. 4,740,505
=============
Net asset value, offering and redemption price per share ................................................ $ 9.94
=============
See accompanying notes to financial statements.
TAX-FREE FUND FOR UTAH
STATEMENT OF OPERATIONS
YEAR ENDED JUNE 30, 2007
INVESTMENT INCOME:
Interest income ............................................................... $ 10,153,461
Expenses:
Management fee (note 3) ....................................................... $ 1,110,710
Distribution and service fees (note 3) ........................................ 615,527
Transfer and shareholder servicing agent fees ................................. 167,771
Trustees' fees and expenses (note 8) .......................................... 87,872
Legal fees (note 3) ........................................................... 85,893
Shareholders' reports and proxy statements .................................... 81,638
Fund accounting fees .......................................................... 49,082
Custodian fees ................................................................ 35,167
Registration fees and dues .................................................... 30,785
Auditing and tax fees ......................................................... 19,963
Insurance ..................................................................... 14,951
Chief compliance officer (note 3) ............................................. 4,543
Miscellaneous ................................................................. 40,223
-----------
Total expenses ................................................................ 2,344,125
Management fee waived (note 3) ................................................ (666,428)
Expenses paid indirectly (note 6) ............................................. (35,773)
-----------
Net expenses .................................................................. 1,641,924
------------
Net investment income ......................................................... 8,511,537
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS:
Net realized gain (loss) from securities transactions ......................... 686,688
Change in unrealized depreciation on investments .............................. 310,980
-----------
Net realized and unrealized gain (loss) on investments ........................ 997,668
------------
Net increase in net assets resulting from operations ............................... $ 9,509,205
============
See accompanying notes to financial statements.
TAX-FREE FUND FOR UTAH
STATEMENTS OF CHANGES IN NET ASSETS
YEAR ENDED YEAR ENDED
JUNE 30, 2007 JUNE 30, 2006
------------- -------------
OPERATIONS:
Net investment income ....................................................... $ 8,511,537 $ 7,660,792
Net realized gain (loss) from securities transactions ....................... 686,688 349,428
Change in unrealized depreciation on investments ............................ 310,980 (7,697,675)
------------- -------------
Change in net assets from operations ...................................... 9,509,205 312,545
------------- -------------
DISTRIBUTIONS TO SHAREHOLDERS (note 10):
Class A Shares:
Net investment income ....................................................... (5,969,997) (5,675,675)
Class C Shares:
Net investment income ....................................................... (1,072,516) (1,052,465)
Class Y Shares:
Net investment income ....................................................... (1,896,685) (1,389,390)
------------- -------------
Change in net assets from distributions ................................... (8,939,198) (8,117,530)
------------- -------------
CAPITAL SHARE TRANSACTIONS (note 7):
Proceeds from shares sold ................................................... 55,169,672 90,295,939
Reinvested dividends and distributions ...................................... 5,565,179 5,246,203
Cost of shares redeemed ..................................................... (50,191,077) (43,527,443)
------------- -------------
Change in net assets from capital share transactions ...................... 10,543,774 52,014,699
------------- -------------
Change in net assets ...................................................... 11,113,781 44,209,714
NET ASSETS:
Beginning of period ........................................................... 215,809,345 171,599,631
------------- -------------
End of period* ................................................................ $ 226,923,126 $ 215,809,345
============= =============
* Includes undistributed net investment income and distributions
in excess of net investment income, respectively, of: $ 34,778 $ (119,601)
============= =============
See accompanying notes to financial statements.
TAX-FREE FUND FOR UTAH
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2007
1. ORGANIZATION
Tax-Free Fund For Utah (the "Fund"), a non-diversified, open-end
investment company, was organized on December 12, 1990 as a Massachusetts
business trust and commenced operations on July 24, 1992. The Fund is authorized
to issue an unlimited number of shares and, since its inception to May 21, 1996,
offered only one class of shares. On that date, the Fund began offering two
additional classes of shares, Class C and Class Y Shares. All shares outstanding
prior to that date were designated as Class A Shares and are sold with a
front-payment sales charge and bear an annual distribution fee. Class C Shares
are sold with a level-payment sales charge with no payment at time of purchase
but level service and distribution fees from date of purchase through a period
of six years thereafter. A contingent deferred sales charge of 1% is assessed to
any Class C shareholder who redeems shares of this Class within one year from
the date of purchase. Class C Shares, together with a pro-rata portion of all
Class C Shares acquired through reinvestment of dividends and other
distributions paid in additional Class C Shares, automatically convert to Class
A Shares after 6 years. The Class Y Shares are only offered to institutions
acting for an investor in a fiduciary, advisory, agency, custodian or similar
capacity and are not offered directly to retail investors. Class Y Shares are
sold at net asset value without any sales charge, redemption fees, contingent
deferred sales charge or distribution or service fees. On October 31, 1997, the
Fund established Class I Shares which are offered and sold only through
financial intermediaries and are not offered directly to retail investors. As of
the report date, there were no Class I Shares outstanding. All classes of shares
represent interests in the same portfolio of investments and are identical as to
rights and privileges but differ with respect to the effect of sales charges,
the distribution and/or service fees borne by each class, expenses specific to
each class, voting rights on matters affecting a single class and the exchange
privileges of each class.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies followed by
the Fund in the preparation of its financial statements. The policies are in
conformity with accounting principles generally accepted in the United States of
America for investment companies.
a) PORTFOLIO VALUATION: Municipal securities which have remaining maturities
of more than 60 days are valued each business day based upon information
provided by a nationally prominent independent pricing service and
periodically verified through other pricing services. In the case of
securities for which market quotations are readily available, securities
are valued by the pricing service at the mean of bid and asked quotations.
If market quotations or a valuation from the pricing service is not
readily available, the security is valued at fair value determined in good
faith under procedures established by and under the general supervision of
the Board of Trustees. Securities which mature in 60 days or less are
valued at amortized cost if their term to maturity at purchase is 60 days
or less, or by amortizing their unrealized appreciation or depreciation on
the 61st day prior to maturity, if their term to maturity at purchase
exceeds 60 days.
b) SECURITIES TRANSACTIONS AND RELATED INVESTMENT INCOME: Securities
transactions are recorded on the trade date. Realized gains and losses
from securities transactions are reported on the identified cost basis.
Interest income is recorded daily on the accrual basis and is adjusted for
amortization of premium and accretion of original issue and market
discount.
c) FEDERAL INCOME TAXES: It is the policy of the Fund to qualify as a
regulated investment company by complying with the provisions of the
Internal Revenue Code applicable to certain investment companies. The Fund
intends to make distributions of income and securities profits sufficient
to relieve it from all, or substantially all, Federal income and excise
taxes.
d) MULTIPLE CLASS ALLOCATIONS: All income, expenses (other than
class-specific expenses), and realized and unrealized gains or losses are
allocated daily to each class of shares based on the relative net assets
of each class. Class-specific expenses, which include distribution and
service fees and any other items that are specifically attributed to a
particular class, are charged directly to such class.
e) USE OF ESTIMATES: The preparation of financial statements in conformity
with accounting principles generally accepted in the United States of
America requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements
and the reported amounts of increases and decreases in net assets from
operations during the reporting period. Actual results could differ from
those estimates.
f) ACCOUNTING PRONOUNCEMENTS: In July 2006, the Financial Accounting
Standards Board ("FASB") released FASB Interpretation No. 48 "Accounting
for Uncertainty in Income Taxes" ("FIN 48"). FIN 48 provides guidance for
how uncertain tax positions should be recognized, measured, presented and
disclosed in the financial statements. FIN 48 requires the evaluation of
tax positions taken or expected to be taken in the course of preparing the
Fund's tax returns to determine whether the tax positions are
"more-likely-than-not" of being sustained by the applicable tax authority.
Tax positions not deemed to meet the more-likely-than-not threshold would
be recorded as a tax benefit or expense in the current year. Adoption of
FIN 48 is required to be implemented no later than December 31, 2007 and
is to be applied to all open tax years as of that date. At this time,
management does not believe the adoption of FIN 48 will result in any
material impact on the Fund's financial statements.
In September 2006, FASB issued FASB Statement No. 157, "Fair Value
Measurement" ("SFAS 157"), which defines fair value, establishes a
framework for measuring fair value, and expands disclosures about fair
value measurements. SFAS 157 is effective for fiscal years beginning after
November 15, 2007, and interim periods within those fiscal years. The Fund
believes adoption of SFAS 157 will have no material impact on the Fund's
financial statements.
3. FEES AND RELATED PARTY TRANSACTIONS
a) MANAGEMENT ARRANGEMENTS:
Aquila Investment Management LLC (the "Manager"), a wholly-owned
subsidiary of Aquila Management Corporation, the Fund's founder and sponsor,
serves as the Manager for the Fund under an Advisory and Administration
Agreement with the Fund. Under the Advisory and Administration Agreement, the
Manager provides all investment management and administrative services to the
Fund. The Manager's services include providing the office of the Fund and all
related services as well as managing relationships with all the various support
organizations to the Fund such as the shareholder servicing agent, custodian,
legal counsel, fund accounting agent, auditors and distributor. For its
services, the Manager is entitled to receive a fee which is payable monthly and
computed as of the close of business each day at the annual rate of 0.50 of 1%
on the Fund's average net assets.
For the year ended June 30, 2007, the Fund incurred management fees of
$1,110,710 of which $666,428 was waived. The Manager has contractually
undertaken to waive fees and/or reimburse Fund expenses during the period July
1, 2006 through June 30, 2007 so that total Fund expenses would not exceed 0.85%
for Class A Shares, 1.65% for Class C Shares or 0.65% for Class Y Shares.
Under a Compliance Agreement with the Manager, the Manager is compensated
for Chief Compliance Officer related services provided to enable the Fund to
comply with Rule 38a-1 of the Investment Company Act of 1940.
Specific details as to the nature and extent of the services provided by
the Manager are more fully defined in the Fund's Prospectus and Statement of
Additional Information.
b) DISTRIBUTION AND SERVICE FEES:
The Fund has adopted a Distribution Plan (the "Plan") pursuant to Rule
12b-1 (the "Rule") under the Investment Company Act of 1940, as amended. Under
one part of the Plan, with respect to Class A Shares, the Fund is authorized to
make distribution fee payments to broker-dealers or others ("Qualified
Recipients") selected by Aquila Distributors, Inc. (the "Distributor")
including, but not limited to, any principal underwriter of the Fund, with which
the Distributor has entered into written agreements contemplated by the Rule and
which have rendered assistance in the distribution and/or retention of the
Fund's shares or servicing of shareholder accounts. The Fund makes payment of
this service fee at the annual rate of 0.20% of the Fund's average net assets
represented by Class A Shares. For the year ended June 30, 2007, distribution
fees on Class A Shares amounted to $291,171, of which the Distributor retained
$5,476.
Under another part of the Plan, the Fund is authorized to make payments
with respect to Class C Shares to Qualified Recipients which have rendered
assistance in the distribution and/or retention
of the Fund's Class C shares or servicing of shareholder accounts. These
payments are made at the annual rate of 0.75% of the Fund's average net assets
represented by Class C Shares and for the year ended June 30, 2007, amounted to
$243,267. In addition, under a Shareholder Services Plan, the Fund is authorized
to make service fee payments with respect to Class C Shares to Qualified
Recipients for providing personal services and/or maintenance of shareholder
accounts. These payments are made at the annual rate of 0.25% of the Fund's
average net assets represented by Class C Shares and for the year ended June 30,
2007 amounted to $81,089. The total of these payments with respect to Class C
Shares amounted to $324,356, of which the Distributor retained $64,436.
Specific details about the Plans are more fully defined in the Fund's
Prospectus and Statement of Additional Information.
Under a Distribution Agreement, the Distributor serves as the exclusive
distributor of the Fund's shares. Through agreements between the Distributor and
various broker-dealer firms ("dealers"), the Fund's shares are sold primarily
through the facilities of these dealers having offices within Utah, with the
bulk of sales commissions inuring to such dealers. For the year ended June 30,
2007, total commissions on sales of Class A Shares amounted to $446,181, of
which the Distributor received $36,972.
c) OTHER RELATED PARTY TRANSACTIONS:
For the year ended June 30, 2007, the Fund incurred $84,683 of legal fees
allocable to Hollyer Brady Barrett & Hines LLP ("Hollyer Brady") and its
successor, Butzel Long PC, counsel to the Fund, for legal services in
conjunction with the Fund's ongoing operations. The Secretary of the Fund was a
partner at Hollyer Brady and is a shareholder of its successor.
4. PURCHASES AND SALES OF SECURITIES
During the year ended June 30, 2007, purchases of securities and proceeds
from the sales of securities aggregated $52,280,717 and $38,384,278,
respectively.
At June 30, 2007, the aggregate tax cost for all securities was
$226,799,052. At June 30, 2007, the aggregate gross unrealized appreciation for
all securities in which there is an excess of value over tax cost amounted to
$1,686,777 and aggregate gross unrealized depreciation for all securities in
which there is an excess of tax cost over value amounted to $2,700,856, for a
net unrealized depreciation of $1,014,079.
5. PORTFOLIO ORIENTATION
Since the Fund may invest entirely in double tax-free municipal
obligations of issuers within Utah, it is subject to possible risks associated
with economic, political, or legal developments or industrial or regional
matters specifically affecting Utah and whatever effects these may have upon
Utah issuers' ability to meet their obligations.
The Fund is also permitted to invest in tax-free municipal obligations
meeting comparable quality standards of issuers in certain states that do not
tax the interest on obligations of Utah issuers and that provide income which is
exempt from both regular Federal and Utah income taxes. At June 30, 2007, the
Fund had 63% of its net assets invested in State of Utah municipal issues.
6. EXPENSES
The Fund has negotiated an expense offset arrangement with its custodian
wherein it receives credit toward the reduction of custodian fees and other Fund
expenses whenever there are uninvested cash balances. The Statement of
Operations reflects the total expenses before any offset, the amount of offset
and the net expenses.
7. CAPITAL SHARE TRANSACTIONS
Transactions in Capital Shares of the Fund were as follows:
YEAR ENDED YEAR ENDED
JUNE 30, 2007 JUNE 30, 2006
------------------------------ ------------------------------
SHARES AMOUNT SHARES AMOUNT
--------- ------------ --------- ------------
CLASS A SHARES:
Proceeds from shares sold .............. 2,804,057 $ 28,292,959 3,497,622 $ 35,254,242
Reinvested distributions ............... 385,904 3,893,635 369,013 3,717,136
Cost of shares redeemed ................ (2,569,962) (25,914,165) (1,747,696) (17,557,375)
--------- ------------ --------- ------------
Net change ..................... 619,999 6,272,429 2,118,939 21,414,003
--------- ------------ --------- ------------
CLASS C SHARES:
Proceeds from shares sold .............. 758,270 7,658,338 1,195,649 12,049,190
Reinvested distributions ............... 62,950 634,919 63,534 639,693
Cost of shares redeemed ................ (1,125,043) (11,352,553) (524,023) (5,274,452)
--------- ------------ --------- ------------
Net change ..................... (303,823) (3,059,296) 735,160 7,414,431
--------- ------------ --------- ------------
CLASS Y SHARES:
Proceeds from shares sold .............. 1,898,552 19,218,375 4,237,512 42,992,507
Reinvested distributions ............... 102,317 1,036,625 88,225 889,374
Cost of shares redeemed ................ (1,277,759) (12,924,359) (2,049,983) (20,695,616)
--------- ------------ --------- ------------
Net change ..................... 723,110 7,330,641 2,275,754 23,186,265
--------- ------------ --------- ------------
Total transactions in Fund
shares ................................. 1,039,286 $ 10,543,774 5,129,853 $ 52,014,699
========= ============ ========= ============
8. TRUSTEES' FEES AND EXPENSES
At June 30, 2007 there were 7 Trustees, one of which is affiliated with
the Manager and is not paid any fees. The total amount of Trustees' service and
attendance fees paid during the year ended June 30, 2007 was $72,625, to cover
carrying out their responsibilities and attendance at regularly scheduled
quarterly Board Meetings and meetings of the Independent Trustees held prior to
each quarterly Board Meeting. When additional or special meetings are held, the
meeting fees are paid to those Trustees in attendance. Trustees are reimbursed
for their expenses such as travel, accommodations, and meals incurred in
connection with attendance at Board Meetings and the Annual Meeting of
Shareholders. For the year ended June 30, 2007, such meeting-related expenses
amounted to $15,247.
9. SECURITIES TRADED ON A WHEN-ISSUED BASIS
The Fund may purchase or sell securities on a when-issued basis.
When-issued transactions arise when securities are purchased or sold by the Fund
with payment and delivery taking place in the future in order to secure what is
considered to be an advantageous price and yield to the Fund at the time of
entering into the transaction. Beginning on the date the Fund enters into a
when-issued transaction, cash or other liquid securities are segregated in an
amount equal to or greater than the amount of the when-issued transaction. These
transactions are subject to market fluctuations and their current value is
determined in the same manner as for other securities.
10. INCOME TAX INFORMATION AND DISTRIBUTIONS
The Fund declares dividends daily from net investment income and makes
payments monthly in additional shares at the net asset value per share, in cash,
or in a combination of both, at the shareholder's option. Net realized capital
gains, if any, are distributed annually and are taxable.
The Fund intends to maintain, to the maximum extent possible, the
tax-exempt status of interest payments received from portfolio municipal
securities in order to allow dividends paid to shareholders from net investment
income to be exempt from regular Federal and State of Utah income taxes.
However, due to differences between financial statement reporting and Federal
income tax reporting requirements, distributions made by the Fund may not be the
same as the Fund's net investment income, and/or net realized securities gains.
In this regard, the Fund credited distributions in excess of net investment
income in the amount of $582,040 and debited additional paid-in capital in the
amount of $582,040 at June 30, 2007. This adjustment had no impact on the Fund's
aggregate net assets at June 30, 2007. Further, a small portion of the dividends
may, under some circumstances, be subject to taxes at ordinary income rates. For
certain shareholders some dividend income may, under some circumstances, be
subject to the alternative minimum tax.
At June 30, 2007, the Fund had a capital loss carryover of $1,704,433 of
which $1,435,148 expires on June 30, 2009, $15,469 expires on June 30, 2011, and
$253,816 expires on June 30, 2012. This carryover is available to offset future
net realized gains on securities transactions to the extent provided for in the
Internal Revenue Code. To the extent that this loss is used to offset future
realized capital gains, it is probable that the gains so offset will not be
distributed.
The tax character of distributions:
YEAR ENDED JUNE 30,
2007 2006
----------- -----------
Net tax-exempt income $ 8,484,772 $ 7,658,064
Ordinary income 454,426 459,466
----------- -----------
$ 8,939,198 $ 8,117,530
=========== ===========
As of June 30, 2007, the components of distributable earnings on a tax
basis were as follows:
Undistributed tax-exempt income $ 175,158
Accumulated net realized loss (1,704,433)
Unrealized depreciation (1,014,079)
Other temporary differences (175,158)
-----------
$(2,718,512)
===========
At June 30, 2007, the difference between book basis and tax basis
unrealized appreciation was attributable primarily to the treatment of accretion
of discounts and amortization of premiums.
11. RECENT DEVELOPMENTS
In late May, 2007, the U. S. Supreme Court agreed to hear an appeal in
DEPARTMENT OF REVENUE OF KENTUCKY V. DAVIS, a case concerning the
constitutionality of differential tax treatment for interest from in-state vs.
out-of-state municipal securities, a practice which is common among the majority
of the states. If the U.S. Supreme Court affirms the prior decision, Kentucky
(and all other states that differentially tax interest on municipal bonds) may
then be required to accord equal income tax treatment to all municipal bond
interest. While it is impossible to predict the consequences of such an outcome,
they may include effects on the net asset values of the shares, and/or on the
tax treatment of the dividends, of some or all single-state municipal bond
funds, including the Fund. The case is expected to be heard and decided during
the U.S. Supreme Court's October 2007 - April 2008 term, with a decision likely
to be handed down in 2008.
TAX-FREE FUND FOR UTAH
FINANCIAL HIGHLIGHTS
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
Class A
-----------------------------------------------------------------
Year Ended June 30,
-----------------------------------------------------------------
2007 2006 2005 2004 2003
-------- -------- -------- -------- --------
Net asset value, beginning of period ......................... $ 9.87 $ 10.26 $ 9.91 $ 10.31 $ 9.85
-------- -------- -------- -------- --------
Income (loss) from investment operations:
Net investment income .................................. 0.40+ 0.40+ 0.41+ 0.43++ 0.44+
Net gain (loss) on securities (both realized
and unrealized) ................................... 0.05 (0.37) 0.38 (0.37) 0.48
-------- -------- -------- -------- --------
Total from investment operations ....................... 0.45 0.03 0.79 0.06 0.92
-------- -------- -------- -------- --------
Less distributions (note 10):
Dividends from net investment income ................... (0.41) (0.42) (0.44) (0.46) (0.46)
Distributions from capital gains ....................... -- -- -- -- --
-------- -------- -------- -------- --------
Total distributions .................................... (0.41) (0.42) (0.44) (0.46) (0.46)
-------- -------- -------- -------- --------
Net asset value, end of period ............................... $ 9.91 $ 9.87 $ 10.26 $ 9.91 $ 10.31
======== ======== ======== ======== ========
Total return (not reflecting sales charge) ................... 4.60% 0.28% 8.06% 0.54% 9.55%
Ratios/supplemental data
Net assets, end of period (in thousands) ............... $148,894 $142,227 $126,091 $ 94,103 $ 85,329
Ratio of expenses to average net assets ................ 0.68% 0.64% 0.59% 0.48% 0.43%
Ratio of net investment income to average
net assets ........................................ 3.89% 3.90% 3.98% 4.19% 4.31%
Portfolio turnover rate ................................ 17.36% 9.61% 8.68% 15.98% 6.43%
The expense and net investment income ratios without the effect of the waiver of a portion of the management fee and the expense
reimbursement were (note 3):
Ratio of expenses to average net assets ................ 0.96% 0.93% 0.97% 0.94% 1.02%
Ratio of net investment income to average
net assets ........................................ 3.61% 3.61% 3.60% 3.73% 3.72%
The expense ratios after giving effect to the waiver, reimbursement and expense offset for uninvested cash balances were (note 3):
Ratio of expenses to average net assets ................ 0.66% 0.61% 0.56% 0.47% 0.42%
- ----------
+ Per share amounts have been calculated using the monthly average shares
method.
++ Per share amount calculated using the daily average shares method.
See accompanying notes to financial statements.
TAX-FREE FUND FOR UTAH
FINANCIAL HIGHLIGHTS (CONTINUED)
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD
Class C
-----------------------------------------------------------------
Year Ended June 30,
-----------------------------------------------------------------
2007 2006 2005 2004 2003
-------- -------- -------- -------- --------
Net asset value, beginning of period ......................... $ 9.87 $ 10.26 $ 9.91 $ 10.30 $ 9.85
-------- -------- -------- -------- --------
Income (loss) from investment operations:
Net investment income .................................. 0.32+ 0.32+ 0.32+ 0.34++ 0.34+
Net gain (loss) on securities (both
realized and unrealized) .......................... 0.05 (0.37) 0.38 (0.36) 0.48
-------- -------- -------- -------- --------
Total from investment operations ............................. 0.37 (0.05) 0.70 (0.02) 0.82
-------- -------- -------- -------- --------
Less distributions (note 10):
Dividends from net investment income ................... (0.33) (0.34) (0.35) (0.37) (0.37)
Distributions from capital gains ....................... -- -- -- -- --
-------- -------- -------- -------- --------
Total distributions .................................... (0.33) (0.34) (0.35) (0.37) (0.37)
-------- -------- -------- -------- --------
Net asset value, end of period ............................... $ 9.91 $ 9.87 $ 10.26 $ 9.91 $ 10.30
======== ======== ======== ======== ========
Total return (not reflecting sales charge) ................... 3.77% (0.52)% 7.20% (0.16)% 8.48%
Ratios/supplemental data
Net assets, end of period (in thousands) ............... $ 30,905 $ 33,791 $ 27,581 $ 21,961 $ 16,420
Ratio of expenses to average net assets ................ 1.48% 1.44% 1.39% 1.27% 1.31%
Ratio of net investment income to
average net assets ................................ 3.10% 3.10% 3.18% 3.38% 3.39%
Portfolio turnover rate ................................ 17.36% 9.61% 8.68% 15.98% 6.43%
The expense and net investment income ratios without the effect of the waiver of a portion of the management fee and the expense
reimbursement were (note 3):
Ratio of expenses to average net assets ................ 1.76% 1.72% 1.77% 1.74% 1.81%
Ratio of net investment income to
average net assets ................................ 2.81% 2.81% 2.80% 2.93% 2.89%
The expense ratios after giving effect to the waiver, reimbursement and expense offset for uninvested cash balances were (note 3):
Ratio of expenses to average net assets ................ 1.46% 1.41% 1.36% 1.27% 1.30%
Class Y
-----------------------------------------------------------------
Year Ended June 30,
-----------------------------------------------------------------
2007 2006 2005 2004 2003
-------- -------- -------- -------- --------
Net asset value, beginning of period ......................... $ 9.90 $ 10.29 $ 9.94 $ 10.34 $ 9.89
-------- -------- -------- -------- --------
Income (loss) from investment operations:
Net investment income .................................. 0.41+ 0.42+ 0.42+ 0.44++ 0.42+
Net gain (loss) on securities (both
realized and unrealized) .......................... 0.07 (0.37) 0.39 (0.36) 0.50
-------- -------- -------- -------- --------
Total from investment operations ............................. 0.48 0.05 0.81 0.08 0.92
-------- -------- -------- -------- --------
Less distributions (note 10):
Dividends from net investment income ................... (0.44) (0.44) (0.46) (0.48) (0.47)
Distributions from capital gains ....................... -- -- -- -- --
-------- -------- -------- -------- --------
Total distributions .................................... (0.44) (0.44) (0.46) (0.48) (0.47)
-------- -------- -------- -------- --------
Net asset value, end of period ............................... $ 9.94 $ 9.90 $ 10.29 $ 9.94 $ 10.34
======== ======== ======== ======== ========
Total return (not reflecting sales charge) ................... 4.80% 0.49% 8.27% 0.76% 9.55%
Ratios/supplemental data
Net assets, end of period (in thousands) ............... $ 47,124 $ 39,791 $ 17,928 $ 8,233 $ 883
Ratio of expenses to average net assets ................ 0.48% 0.44% 0.39% 0.28% 0.30%
Ratio of net investment income to
average net assets ................................ 4.09% 4.10% 4.15% 4.41% 4.17%
Portfolio turnover rate ................................ 17.36% 9.61% 8.68% 15.98% 6.43%
The expense and net investment income ratios without the effect of the waiver of a portion of the management fee and the expense
reimbursement were (note 3):
Ratio of expenses to average net assets ................ 0.76% 0.72% 0.77% 0.74% 0.78%
Ratio of net investment income to
average net assets ................................ 3.81% 3.82% 3.78% 3.95% 3.70%
The expense ratios after giving effect to the waiver, reimbursement and expense offset for uninvested cash balances were (note 3):
Ratio of expenses to average net assets ................ 0.46% 0.41% 0.37% 0.27% 0.29%
- ----------
+ Per share amounts have been calculated using the monthly average shares
method.
++ Per share amount calculated using the daily average shares method.
See accompanying notes to financial statements.
NUMBER OF
POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS
HELD WITH IN FUND HELD BY TRUSTEE
NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS
ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS
AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.)
- ----------------- ---------- ------------------- ---------- ---------------------
INTERESTED TRUSTEES(4)
Diana P. Herrmann Trustee since 1997 Vice Chair and Chief Executive Officer 12 ICI Mutual Insurance Company
New York, NY and President of Aquila Management Corporation,
(02/25/58) since 1998 Founder of the Aquila Group of
Funds(SM)(5) and parent of Aquila
Investment Management LLC, Manager since
2004, President and Chief Operating
Officer since 1997, a Director since
1984, Secretary since 1986 and
previously its Executive Vice President,
Lacy B. Herrmann Founder and Chairman Founder and Chairman of the Board,
1986-1997; Chief Executive Officer and
Vice Chair since 2004 and President,
Chief Operating Officer and Manager of
the Manager since 2003; Chair, Vice
Chair, President, Executive Vice
President or Senior Vice President of
funds in the Aquila Group of Funds(SM)
since 1986; Director of the Distributor
since 1997; trustee, Reserve
Money-Market Funds, 1999-2000 and
Reserve Private Equity Series,
1998-2000; Governor, Investment Company
Institute and head of its Small Funds
Committee since 2004; active in
charitable and volunteer organizations.
NON-INTERESTED TRUSTEES
Gary C. Cornia Chair of the Board Director, Romney Institute of Public 4 None
Orem, UT of Trustees since Management, Marriott School of
(06/24/48) 2005 and Trustee Management, Brigham Young University,
since 1993 2004 - present; Professor, Marriott
School of Management, 1980 - present;
Past President, the National Tax
Association; Fellow, Lincoln Institute
of Land Policy, 2002 - present;
Associate Dean, Marriott School of
Management, Brigham Young University,
1991-2000; Utah Governor's Tax Review
Committee since 1993.
NUMBER OF
POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS
HELD WITH IN FUND HELD BY TRUSTEE
NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS
ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS
AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.)
- ----------------- ---------- ------------------- ---------- ---------------------
Anne J. Mills Vice Chair of the President, Loring Consulting Company 4 None
Castle Rock, CO Bord since 2006 and since 2001; Vice President for Business
(12/23/38) Trustee since 1994 Management and CFO, Ottawa University,
since 2006, Vice President for Business
Affairs, 1992-2001; IBM Corporation,
1965-1991; currently active with various
charitable educational and religious
organizations.
Tucker Hart Adams Trustee President, The Adams Group, Inc., an 3 Director, Colorado Health
Colorado Springs, CO since 2006 economic consulting firm, since 1989; Facilities Authority
(01/11/38) formerly Chief Economist, United Banks
of Colorado; currently or formerly
active with numerous professional and
community organizations.
Thomas A. Christopher Trustee Vice President of Robinson, Hughes & 3 None
Danville, KY since 2006 Christopher, C.P.A.s, P.S.C., since
(12/19/47) 1977; President, A Good Place for Fun,
Inc., a sports facility, since 1987;
currently or formerly active with
various professional and community
organizations.
Lyle W. Hillyard Trustee President of the law firm of Hillyard, 2 None
Logan, UT since 2003 Anderson & Olsen, Logan, Utah, since
(09/25/40) 1967; member of Utah Senate, 1985 to
present, in the following positions:
President, 2000, Senate Majority Leader,
1999-2000, Assistant Majority Whip,
1995-1998; served as Chairman of the
following Senate Committees: Tax and
Revenue, Senate Judiciary Standing,
Joint Executive Appropriations, and
Senate Rules; currently serves as
Co-Chair, Joint Executive
Appropriations.
NUMBER OF
POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS
HELD WITH IN FUND HELD BY TRUSTEE
NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS
ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS
AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.)
- ----------------- ---------- ------------------- ---------- ---------------------
John C. Lucking Trustee President, Econ-Linc, an economic 3 Director, Sanu Resources
Phoenix, AZ since 2004 consulting firm, since 1995; formerly
(05/20/43) Consulting Economist, Bank One Arizona
and Chief Economist, Valley National
Bank; member, Arizona's Joint
Legislative Budget Committee Economic
Advisory Panel and the Western Blue Chip
Economic Forecast Panel; Board, Northern
Arizona University Foundation since
1997; member, various historical, civic
and economic associations.
OTHER INDIVIDUALS
CHAIRMAN EMERITUS(6)
Lacy B. Herrmann Founder and Chairman Founder and Chairman of the Board, N/A N/A
New York, NY Emeritus since 2005, Aquila Management Corporation, the
(05/12/29) Chairman of the sponsoring organization and parent of
Board of Trustees, the Manager or Administrator and/or
1992-2005 Adviser or Sub-Adviser to each fund of
the Aquila Group of Funds(SM); Chairman of
the Manager or Administrator and/or
Adviser or Sub-Adviser to each since
2004; Founder and Chairman Emeritus of
each fund in the Aquila Group of
Funds(SM); previously Chairman and a
Trustee of each fund in the Aquila Group
of Funds(SM) since its establishment until
2004 or 2005; 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.
OFFICERS
Charles E. Executive Vice Executive Vice President of all funds in N/A N/A
Childs, III President since 2003 the Aquila Group of Funds(SM) and the
New York, NY Manager and the Manager's parent since
(04/01/57) 2003; formerly Senior Vice President,
corporate development, 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 Aquila
Money-Market Funds, 1988-2003.
NUMBER OF
POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS
HELD WITH IN FUND HELD BY TRUSTEE
NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS
ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS
AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.)
- ----------------- ---------- ------------------- ---------- ---------------------
Jerry G. McGrew Senior Vice President President of the Distributor since 1998, N/A N/A
New York, NY since 1997 Registered Principal since 1993, Senior
(06/18/44) Vice President, 1997-1998 and Vice
President, 1993-1997; Senior Vice
President, Aquila Three Peaks High
Income Fund, Aquila Rocky Mountain
Equity Fund and five Aquila Municipal
Bond Funds; Vice President, Churchill
Cash Reserves Trust, 1995-2001.
Kimball L. Young Senior Vice President Co-portfolio manager, Tax-Free Fund For N/A N/A
Salt Lake City, UT since 1997 Utah since 2001; Co-founder, Lewis Young
(08/07/46) Robertson & Burningham, Inc., a NASD
licensed broker/dealer providing public
finance services to Utah local
governments, 1995-2001; Senior Vice
President of two Aquila Bond Funds and
Aquila Rocky Mountain Equity Fund;
formerly Senior Vice President-Public
Finance, Kemper Securities Inc., Salt
Lake City, Utah.
Thomas S. Albright Senior Vice Senior Vice President and Portfolio N/A N/A
Louisville, KY President since 2003 Manager, Churchill Tax-Free Fund of
(07/26/52) and Vice President, Kentucky since July 2000; Senior Vice
2001-2003 President, Tax-Free Fund For Utah since
2003, Vice President, 2001-2003 and
co-portfolio manager since 2001; Vice
President and backup portfolio manager,
Tax-Free Trust of Arizona, since 2004;
Vice President and Portfolio Manager,
Banc One Investment Advisors, Inc.,
1994-2000.
Mary Kayleen Willis Vice President since Vice President, Tax-Free Fund For Utah N/A N/A
Salt Lake City, UT 2003 and Assistant since September 2003, Assistant Vice
(06/11/63) Vice President, President, 2002-2003; Vice President,
2002-2003 Aquila Rocky Mountain Equity Fund, since
2004.
Robert W. Anderson Chief Compliance Chief Compliance Officer of the Fund and N/A N/A
New York, NY Officer since 2004 each of the other funds in the Aquila
(08/23/40) and Assistant Group of Funds(SM), the Manager and the
Secretary since 2000 Distributor since 2004, Compliance
Officer of the Manager or its
predecessor and current parent
1998-2004; Assistant Secretary of the
Aquila Group of Funds(SM) since 2000.
NUMBER OF
POSITIONS PORTFOLIOS OTHER DIRECTORSHIPS
HELD WITH IN FUND HELD BY TRUSTEE
NAME, FUND AND PRINCIPAL COMPLEX (THE POSITION HELD IS
ADDRESS(2) LENGTH OF OCCUPATION(S) OVERSEEN A DIRECTORSHIP UNLESS
AND DATE OF BIRTH SERVICE(3) DURING PAST 5 YEARS BY TRUSTEE INDICATED OTHERWISE.)
- ----------------- ---------- ------------------- ---------- ---------------------
Joseph P. DiMaggio Chief Financial Chief Financial Officer of the Aquila N/A N/A
New York, NY Officer since 2003 Group of Funds(SM) since 2003 and
(11/06/56) and Treasurer since Treasurer since 2000.
2000
Edward M. W. Hines Secretary since 1992 Partner and then shareholder of legal N/A N/A
New York, NY counsel to the Trust/Fund, Hollyer Brady
(12/16/39) Barrett & Hines LLP since 1989 and
thereafter its successor, Butzel Long,
since 2007; Secretary of the Aquila
Group of Funds(SM).
John M. Herndon Assistant Secretary Assistant Secretary of the Aquila Group N/A N/A
New York, NY since 1995 of Funds(SM) since 1995 and Vice President
(12/17/39) 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 Treasurer Assistant Treasurer of the Aquila Group N/A N/A
New York, NY since 2000 of Funds(SM) since 2000; Assistant Vice
(11/02/66) President of the Manager or its
predecessor and current parent since
1998; Fund Accountant for the Aquila
Group of Funds(SM), 1995-1998.
- ----------
(1) The Fund'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 Fund For
Utah, 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) Ms. Herrmann is an interested person of the Fund as an officer of the Fund,
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. Ms. Herrmann is the daughter of Lacy B. Herrmann, the Founder and
Chairman Emeritus of the Fund.
(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 Municipal Bond
Funds"; Aquila Rocky Mountain Equity Fund is an equity fund; Aquila Three Peaks
High Income Fund is a high income corporate bond fund; considered together,
these 12 funds are called the "Aquila Group of Funds(SM)."
(6) The Chairman Emeritus may attend Board meetings but has no voting power.
- --------------------------------------------------------------------------------
ANALYSIS OF EXPENSES (UNAUDITED)
As a shareholder of the Fund, you may incur two types of costs: (1)
transaction costs, including front-end sales charges with respect to Class A
shares or contingent deferred sales charges ("CDSC") with respect to Class C
shares; and (2) ongoing costs, including management fees; distribution and/or
service (12b-1) fees; and other Fund expenses. The table below is intended to
help you understand your ongoing costs (in dollars) of investing in the Fund and
to compare these costs with the ongoing costs of investing in other mutual
funds.
The table below is based on an investment of $1,000 invested on January 1,
2007 and held for the six months ended June 30, 2007.
ACTUAL EXPENSES
This table provides information about actual account values and actual
expenses. You may use the information provided in this table, together with the
amount you invested, to estimate the expenses that you paid over the period. To
estimate the expenses you paid on your account, divide your ending account value
by $1,000 (for example, an $8,600 ending account value divided by $1,000 = 8.6),
then multiply the result by the number under the heading entitled "Expenses Paid
During the Period".
SIX MONTHS ENDED JUNE 30, 2007
ACTUAL
TOTAL RETURN BEGINNING ENDING EXPENSES
WITHOUT ACCOUNT ACCOUNT PAID DURING
SALES CHARGES(1) VALUE VALUE THE PERIOD(2)
- --------------------------------------------------------------------------------
Class A (0.46)% $1,000.00 $995.40 $3.27
- --------------------------------------------------------------------------------
Class C (0.75)% $1,000.00 $992.50 $7.21
- --------------------------------------------------------------------------------
Class Y (0.35)% $1,000.00 $996.50 $2.28
- --------------------------------------------------------------------------------
(1) ASSUMES REINVESTMENT OF ALL DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS, IF
ANY, AT NET ASSET VALUE AND DOES NOT REFLECT THE DEDUCTION OF THE
APPLICABLE SALES CHARGES WITH RESPECT TO CLASS A SHARES OR THE APPLICABLE
CONTINGENT DEFERRED SALES CHARGES ("CDSC") WITH RESPECT TO CLASS C SHARES.
TOTAL RETURN IS NOT ANNUALIZED, AS IT MAY NOT BE REPRESENTATIVE OF THE
TOTAL RETURN FOR THE YEAR.
(2) EXPENSES ARE EQUAL TO THE ANNUALIZED EXPENSE RATIO OF 0.66%, 1.46% AND
0.46% FOR THE FUND'S CLASS A, C AND Y SHARES, RESPECTIVELY, MULTIPLIED BY
THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY 181/365 (TO
REFLECT THE ONE-HALF YEAR PERIOD).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
ANALYSIS OF EXPENSES (UNAUDITED) (CONTINUED)
HYPOTHETICAL EXAMPLE FOR COMPARISON PURPOSES
The table below provides information about hypothetical account values and
hypothetical expenses based on the actual expense ratio and an assumed rate of
return of 5.00% per year before expenses, which is not the Fund's actual return.
The hypothetical account values and expenses may not be used to estimate the
actual ending account balance or expenses you paid for the period. You may use
the information provided in this table to compare the ongoing costs of investing
in the Fund and other mutual funds. To do so, compare this 5.00% hypothetical
example relating to the Fund with the 5.00% hypothetical examples that appear in
the shareholder reports of other mutual funds.
Please note that the expenses shown in the table below are meant to
highlight your ongoing costs only and do not reflect any transactional costs
with respect to Class A shares. The example does not reflect the deduction of
contingent deferred sales charges ("CDSC") with respect to Class C shares.
Therefore, the table is useful in comparing ongoing costs only, and will not
help you determine the relative total costs of owning different mutual funds. In
addition, if these transaction costs were included, your costs would have been
higher.
SIX MONTHS ENDED JUNE 30, 2007
HYPOTHETICAL
ANNUALIZED BEGINNING ENDING EXPENSES
TOTAL ACCOUNT ACCOUNT PAID DURING
RETURN VALUE VALUE THE PERIOD(1)
- --------------------------------------------------------------------------------
Class A 5.00% $1,000.00 $1,021.52 $3.31
- --------------------------------------------------------------------------------
Class C 5.00% $1,000.00 $1,017.55 $7.30
- --------------------------------------------------------------------------------
Class Y 5.00% $1,000.00 $1,022.51 $2.31
- --------------------------------------------------------------------------------
(1) EXPENSES ARE EQUAL TO THE ANNUALIZED EXPENSE RATIO OF 0.66%, 1.46% AND
0.46% FOR THE FUND'S CLASS A, C AND Y SHARES, RESPECTIVELY, MULTIPLIED BY
THE AVERAGE ACCOUNT VALUE OVER THE PERIOD, MULTIPLIED BY 181/365 (TO
REFLECT THE ONE-HALF YEAR PERIOD).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
INFORMATION AVAILABLE (UNAUDITED)
Much of the information that the funds in the Aquila Group of Funds(SM)
produce is automatically sent to you and all other shareholders. Specifically,
you are routinely sent the entire list of portfolio securities of your Fund
twice a year in the semi-annual and annual reports you receive. Additionally, we
prepare, and have available, portfolio listings at the end of each quarter.
Whenever you may be interested in seeing a listing of your Fund's portfolio
other than in your shareholder reports, please check our website
http://www.aquilafunds.com or call us at 1-800-437-1020.
The Fund additionally files a complete list of its portfolio holdings with
the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms
N-Q are available free of charge on the SEC website at http://www.sec.gov. You
may also review or, for a fee, copy the forms at the SEC's Public Reference Room
in Washington, DC or by calling 800-SEC-0330.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
PROXY VOTING RECORD (UNAUDITED)
The Fund does not invest in equity securities. Accordingly, there were no
matters relating to a portfolio security considered at any shareholder meeting
held during the 12 months ended June 30, 2007 with respect to which the Fund was
entitled to vote. Applicable regulations require us to inform you that the
foregoing proxy voting information is available on the SEC website at
http://www.sec.gov.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
FEDERAL TAX STATUS OF DISTRIBUTIONS (UNAUDITED)
This information is presented in order to comply with a requirement of the
Internal Revenue Code AND NO ACTION ON THE PART OF SHAREHOLDERS IS REQUIRED.
For the fiscal year ended June 30, 2007, $8,484,272 of dividends paid by
Tax-Free Fund For Utah, constituting 94.92% of total dividends paid during the
fiscal year ended June 30, 2007, were exempt-interest dividends, and the balance
was ordinary dividend income.
Prior to January 31, 2007, shareholders were mailed the appropriate tax
form(s) which contained information on the status of distributions paid for the
2006 CALENDAR YEAR.
Prior to January 31, 2008, shareholders will be mailed the appropriate tax
form(s) which will contain information on the status of distributions paid for
the 2007 CALENDAR YEAR.
- --------------------------------------------------------------------------------
SHAREHOLDER MEETING RESULTS (UNAUDITED)
The Annual Meeting of Shareholders of Tax-Free Fund For Utah was held on June
22, 2007. The holders of shares representing 80% of the total net asset value of
the shares entitled to vote were present in person or by proxy. At the meeting,
the following matter was voted upon and approved by the shareholders (the
resulting votes are presented below).
1. To elect Trustees
DOLLAR AMOUNT OF VOTES
----------------------
TRUSTEE FOR WITHHELD
------- --- --------
Tucker Hart Adams $181,840,032 $ 873,566
Thomas A. Christopher $181,278,540 $1,435,049
Gary C. Cornia $181,931,137 $ 782,462
Diana P. Herrmann $182,496,256 $ 217,342
Lyle W. Hillyard $181,214,349 $1,499,240
John C. Lucking $181,923,791 $ 789,797
Anne J. Mills $182,415,881 $ 310,611
- --------------------------------------------------------------------------------
PRIVACY NOTICE (UNAUDITED)
TAX-FREE FUND FOR UTAH
OUR PRIVACY POLICY. In providing services to you as an individual who owns or is
considering investing in shares of the Fund, we collect certain non-public
personal information about you. Our policy is to keep this information strictly
safeguarded and confidential, and to use or disclose it only as necessary to
provide services to you or as otherwise permitted by law. Our privacy policy
applies equally to former shareholders and persons who inquire about the Fund.
INFORMATION WE COLLECT. "Non-public personal information" is personally
identifiable financial information about you as an individual or your family.
The kinds of non-public personal information we have about you may include the
information you provide us on your share purchase application or in telephone
calls or correspondence with us, and information about your fund transactions
and holdings, how you voted your shares and the account where your shares are
held.
INFORMATION WE DISCLOSE. We disclose non-public personal information about you
to companies that provide necessary services to us, such as the Fund's transfer
agent, distributor, investment adviser or sub-adviser, as permitted or required
by law, or as authorized by you. Any other use is strictly prohibited. We do not
sell information about you or any of our fund shareholders to anyone.
NON-CALIFORNIA RESIDENTS: We also may disclose some of this information to
another fund in the Aquila Group of Funds(SM) (or its service providers) under
joint marketing agreements that permit the funds to use the information only to
provide you with information about other funds in the Aquila Group of Funds(SM)
or new services we are offering that may be of interest to you.
CALIFORNIA RESIDENTS ONLY: In addition, unless you "opt-out" of the following
disclosures using the form that was mailed to you under separate cover, we may
disclose some of this information to another fund in the Aquila Group of
Funds(SM) (or its sevice providers) under joint marketing agreements that permit
the funds to use the information only to provide you with information about
other funds in the Aquila Group of Funds(SM) or new services we are offering
that may be of interest to you.
HOW WE SAFEGUARD YOUR INFORMATION. We restrict access to non-public personal
information about you to only those persons who need it to provide services to
you or who are permitted by law to receive it. We maintain physical, electronic
and procedural safeguards to protect the confidentiality of all non-public
personal information we have about you.
If you have any questions regarding our Privacy Policy, please contact us at
1-800-437-1020.
AQUILA DISTRIBUTORS, INC.
AQUILA INVESTMENT MANAGEMENT LLC
This Privacy Policy also has been adopted by Aquila Distributors, Inc. and
Aquila Investment Management LLC and applies to all non-public information about
you that each of these companies may obtain in connection with services provided
to the Fund or to you as a shareholder of the Fund.
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Founders
Lacy B. Herrmann, Chairman Emeritus
Aquila Management Corporation
Manager
AQUILA INVESTMENT MANAGEMENT LLC
380 Madison Avenue, Suite 2300
New York, New York 10017
BOARD OF TRUSTEES
Gary C. Cornia, Chair
Anne J. Mills, Vice Chair
Tucker Hart Adams
Thomas A. Christopher
Diana P. Herrmann
Lyle W. Hillyard
John C. Lucking
OFFICERS
Diana P. Herrmann, President
Jerry G. Mcgrew, Senior Vice President
Kimball L. Young, Senior Vice President
and Co-portfolio Manager
Thomas S. Albright, Senior Vice President
and Co-portfolio Manager
M. Kayleen Willis, Vice President
Robert W. Anderson, Chief Compliance Officer
Joseph P. Dimaggio, Chief Financial Officer
and Treasurer
Edward M.w. Hines, Secretary
DISTRIBUTOR
AQUILA DISTRIBUTORS, INC.
380 Madison Avenue, Suite 2300
New York, New York 10017
TRANSFER AND SHAREHOLDER SERVICING AGENT
PFPC INC.
101 Sabin Street
Pawtucket, Ri 02860
CUSTODIAN
JPMORGAN CHASE BANK, N.A.
1111 Polaris Parkway
Columbus, Ohio 43240
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
TAIT, WELLER & BAKER LLP
1818 Market Street, Suite 2400
Philadelphia, Pa 19103
Further information is contained in the prospectus, which must precede or
accompany this report.
ITEM 2. CODE OF ETHICS.
(a) As of June 30, 2007 (the end of the reporting period) the
Trust has adopted a code of ethics that applies to the Trust's
principal executive officer(s)and principal financial officer(s)
and persons performing similar functions ("Covered Officers") as
defined in the Aquila Group of Funds Code of Ethics for Principal
Executive and Senior Financial Officers under Section 406 of the
Sarbanes-Oxley Act of 2002;
(f)(1) Pursuant to Item 10(a)(1), a copy of the Trust's Code of
Ethics that applies to the Trust's principal executive officer(s)
and principal financial officer(s) and persons performing similar
functions is included as an exhibit to its annual report on this
Form N-CSR;
(f)(2) The text of the Trust's Code of Ethics that applies to the
Trust's principal executive officer(s) and principal financial
officer(s) and persons performing similar functions has been
posted on its Internet website which can be found at the Trust's
Internet address at aquilafunds.com.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
(a)(1)(ii) The Board of Trustees of the Fund has determined that
it does not have at least one audit committee financial expert
serving on its audit committee. The Fund does not have such a
person serving on the audit committee because none of the persons
currently serving as Trustees happens to have the technical
accounting and auditing expertise included in the definition of
"audit committee financial expert" recently adopted by the Securities
and Exchange Commission in connection with this Form N-CSR, and the
Board has not heretofore deemed it necessary to seek such a person
for election to the Board.
The primary mission of the Board, which is that of oversight over
the operations and affairs of the Fund, confronts the Trustees with
a wide and expanding range of issues and responsibilities. The
Trustees believe that, accordingly, it is essential that the Board's
membership consist of persons with as extensive experience as possible
in fulfilling the duties and responsibilities of mutual fund directors
and audit committee members and, ideally, with extensive experience
and background relating to the economic and financial sectors and
securities in which the Fund invests, including exposure to the
financial and accounting matters commonly encountered with respect
to those sectors and securities. The Board believes that its current
membership satisfies those criteria. It recognizes that it would
also be helpful to have a member with the relatively focused accounting
and auditing expertise reflected in the applicable definition of
"audit committee financial expert," just as additional members with
similarly focused technical expertise in other areas relevant to
the Fund's operations and affairs would also contribute added value.
However, the Board believes that the Fund is better served, and its
assets better employed, by a policy of hiring experts in various
the specialized area of technical accounting and
auditing matters, if and as the Board identifies the need, rather
than by seeking to expand its numbers by adding technical experts
in the areas constituting its domain of responsibility. The Fund's
Audit Committee Charter explicitly authorizes the Committee to
retain such experts as it deems necessary in fulfilling its duties
under the Charter.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
a) Audit Fees - The aggregate fees billed for professional services
rendered by the principal accountant for the audit of the Registrant's
annual financial statements were $16,000 in 2007 and $16,000 in 2006.
b) Audit Related Fees - There were no amounts billed for audit-related
fees over the past two years.
c) Tax Fees - The Registrant was billed by the principal accountant
$3,000 and $3,000 in 2007 and 2006, respectively, for return preparation
and tax compliance.
d) All Other Fees - There were no additional fees paid for audit and
non-audit services other than those disclosed in a) thorough c) above.
e)(1) Currently, the audit committee of the Registrant pre-approves audit
services and fees on an engagement-by-engagement basis
e)(2) None of the services described in b) through d) above were approved
by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of
Regulation S-X, all were pre-approved on an engagement-by-engagement basis.
f) No applicable.
g) There were no non-audit services fees billed by the Registrant's accountant
to the Registrant's investment adviser or distributor over the past two years
h) Not applicable.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. SCHEDULE OF INVESTMENTS.
Included in Item 1 above
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR
CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The Board of Directors of the Registrant has adopted a Nominating
Committee Charter which provides that the Nominating Committee (the 'Committee')
may consider and evaluate nominee candidates properly submitted by shareholders
if a vacancy among the Independent Trustees of the Registrant occurs and if,
based on the Board's then current size, composition and structure, the Committee
determines that the vacancy should be filled. The Committee will consider
candidates submitted by shareholders on the same basis as it considers and
evaluates candidates recommended by other sources. A copy of the qualifications
and procedures that must be met or followed by shareholders to properly submit
a nominee candidate to the Committee may be obtained by submitting a request
in writing to the Secretary of the Registrant.
ITEM 11. CONTROLS AND PROCEDURES.
(a) Based on their evaluation of the registrant's disclosure controls and
procedures (as defined in Rule 30a-2(c) under the Investment Company Act of
1940) as of a date within 90 days of the filing of this report, the registrant's
chief financial and executive officers have concluded that the disclosure
controls and procedures of the registrant are appropriately designed to ensure
that information required to be disclosed in the registrant's reports that are
filed under the Securities Exchange Act of 1934 are accumulated and communicated
to registrant's management, including its principal executive officer(s) and
principal financial officer(s), to allow timely decisions regarding required
disclosure and is recorded, processed, summarized and reported, within the time
periods specified in the rules and forms adopted by the Securities and Exchange
Commission.
(b) There have been no significant changes in registrant's internal controls or
in other factors that could significantly affect registrant's internal controls
subsequent to the date of the most recent evaluation, including no significant
deficiencies or material weaknesses that required corrective action.
ITEM 12. EXHIBITS.
(a)(1) Aquila Group of Funds Code of Ethics for Principal Executive and
Senior Financial Officers under Section 406 of the Sarbanes-Oxley Act
of 2002.
(a)(2) Certifications of principal executive officer and principal financial
officer as required by Rule 30a-2(a) under the Investment Company Act of
1940.
(b) Certifications of principal executive officer and principal financial
officer as required by Rule 30a-2(b) under the Investment Company Act
of 1940.
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.
TAX-FREE FUND FOR UTAH
By: /s/ Diana P. Herrmann
- - - ---------------------------------
President and Trustee
September 7, 2007
By: /s/ Joseph P. DiMaggio
- - - -----------------------------------
Chief Financial Officer and Treasurer
September 7, 2007
Pursuant to the requirements of the Securities Exchange Act of 1934
And the Investment Company Act of 1940, this report has been signed
below by the following persons on behalf of the registrant and in the
capacities and on the dates indicated.
By: /s/ Diana P. Herrmann
- - - ---------------------------------
Diana P. Herrmann
President and Trustee
September 7, 2007
By: /s/ Joseph P. DiMaggio
- - - -----------------------------------
Joseph P. DiMaggio
Chief Financial Officer and Treasurer
September 7, 2007
TAX-FREE FUND FOR UTAH
EXHIBIT INDEX
(a)(1) Aquila Group of Funds Code of Ethics for Principal Executive and
Senior Financial Officers under Section 406 of the Sarbanes-Oxley Act
of 2002.
(a) (2) Certifications of principal executive officer
and principal financial officer as required by Rule 30a-2(a)
under the Investment Company Act of 1940.
(b) Certification of chief executive officer and chief financial
officer as required by Rule 30a-2(b) of the Investment Company Act
of 1940.