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 811-22274
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Nuveen New Jersey Municipal Value Fund
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(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Address of principal executive offices) (Zip code)
Kevin J. McCarthy
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
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Date of fiscal year end: April 30
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Date of reporting period: April 30, 2009
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
LOGO: NUVEEN Investments
Closed-End Funds
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Nuveen Investments
Municipal Closed-End Funds
IT'S NOT WHAT YOU EARN, IT'S WHAT YOU KEEP.(R)
Annual Report
April 30, 2009
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- ---------------------- --------------------------
NUVEEN NEW JERSEY NUVEEN PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
FUND FUND
NJV NPN
(APRIL 09)
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LOGO: NUVEEN Investments
Portfolio Manager's Comments
Nuveen Investments Municipal Closed-End Funds NJV and NPN
Portfolio manager Cathryn Steeves who joined Nuveen in 1996, assumed portfolio
management responsibility for the Nuveen New Jersey Municipal Value Fund (NJV)
and Nuveen Pennsylvania Municipal Value Fund (NPN) upon completion of their
initial public offerings on April 28, 2009.
These two Funds, which are currently in the initial investment phase, will
invest primarily in investment-grade municipal bonds. The Funds' primary
investment objective is to provide attractive monthly income exempt from federal
income taxes as well as from New Jersey or Pennsylvania taxes. The Funds'
secondary investment objective is to enhance portfolio value and total return.
The Funds will not use any leverage from preferred shares.
We look forward to reporting on the initial investment activities and
performance of these Funds in the next shareholder report.
Nuveen Investments 3
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
THE BOARD OF TRUSTEES AND SHAREHOLDERS
NUVEEN NEW JERSEY MUNICIPAL VALUE FUND
NUVEEN PENNSYLVANIA MUNICIPAL VALUE FUND
We have audited the accompanying statements of assets and liabilities, including
the portfolio of investments (Nuveen New Jersey Municipal Value Fund only), of
Nuveen New Jersey Municipal Value Fund and Nuveen Pennsylvania Municipal Value
Fund (the Funds) as of April 30, 2009, and the related statements of operations,
statements of changes in net assets and financial highlights for the period
April 28, 2009 (commencement of operations) through April 30, 2009. These
financial statements and financial highlights are the responsibility of the
Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with 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. We were
not engaged to perform an audit of the Funds' 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 Funds' internal control over financial reporting.
Accordingly, we express no such opinion. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used
and significant estimates made by management and evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of April 30, 2009, by correspondence with the custodian and
brokers. 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 positions of
Nuveen New Jersey Municipal Value Fund and Nuveen Pennsylvania Municipal Value
Fund at April 30, 2009, the results of their operations, changes in their net
assets, and the financial highlights for the period April 28, 2009 (commencement
of operations) through April 30, 2009 in conformity with US generally accepted
accounting principles.
/s/ Ernst & Young LLP
Chicago, Illinois
June 19, 2009
4 Nuveen Investments
NJV | Nuveen New Jersey Municipal Value Fund
| Portfolio of INVESTMENTS April 30, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
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HEALTH CARE - 9.4%
$ 2,000 New Jersey Health Care Facilities Financing Authority
Revenue Bonds Virtua Health Issue, Series 2009A, 5.500%,
7/01/38 (WI/DD, Settling 5/14/09) - AGC Insured 7/19 at 100.00 AAA $ 1,960,000
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$ 2,000 Total Investments (cost $1,960,000) - 9.4% 1,960,000
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Other Assets Less Liabilities - 90.6% 18,931,024
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Net Assets - 100% $ 20,891,024
===================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) Optional Call Provisions (not covered by the report of independent
registered public accounting firm): Dates (month and year) and prices of
the earliest optional call or redemption. There may be other call
provisions at varying prices at later dates. Certain mortgage-backed
securities may be subject to periodic principal paydowns.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
WI/DD Purchased on a when-issued or delayed delivery basis.
See accompanying notes to financial statements.
Nuveen Investments 5
| Statement of ASSETS & LIABILITIES April 30, 2009
NEW JERSEY PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
(NJV) (NPN)
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ASSETS
Investments, at value (cost $1,960,000 and $0, respectively) $ 1,960,000 $ --
Cash 20,943,150 15,857,775
Receivable from Adviser 14,656 14,739
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Total assets 22,917,806 15,872,514
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LIABILITIES
Payable for investments purchased 1,960,000 --
Accrued expenses:
Organization and offering costs 58,650 48,000
Other 8,132 8,132
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Total liabilities 2,026,782 56,132
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Net assets $ 20,891,024 $ 15,816,382
=====================================================================================================================
Shares outstanding 1,462,000 1,107,000
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Net asset value per share outstanding $ 14.29 $ 14.29
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NET ASSETS CONSIST OF:
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Shares, $.01 par value per share $ 14,620 $ 11,070
Paid-in surplus 20,876,404 15,805,312
Undistributed net investment income (loss) -- --
Net unrealized appreciation (depreciation) of investments -- --
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Net assets $ 20,891,024 $ 15,816,382
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Authorized shares Unlimited Unlimited
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See accompanying notes to financial statements.
6 Nuveen Investments
| Statement of OPERATIONS
For the period April 28, 2009 (commencement of operations) through April 30,
2009
NEW JERSEY PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
(NJV) (NPN)
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INVESTMENT INCOME $ -- $ --
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EXPENSES
Management fees 344 261
Trustees' fees and expenses 2 2
Professional fees 5,000 5,000
Shareholders' reports - printing and mailing expenses 3,130 3,130
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Total expenses 8,476 8,393
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Net investment income (loss) (8,476) (8,393)
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Net increase (decrease) in net assets from operations $ (8,476) $ (8,393)
=====================================================================================================================
See accompanying notes to financial statements.
Nuveen Investments 7
| Statement of CHANGES in NET ASSETS
For the period April 28, 2009 (commencement of operations) through April 30,
2009
NEW JERSEY PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
(NJV) (NPN)
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OPERATIONS
Net investment income (loss) $ (8,476) $ (8,393)
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Net increase (decrease) in net assets from operations (8,476) (8,393)
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CAPITAL SHARE TRANSACTIONS
Proceeds from sale of shares, net of offering costs 20,799,225 15,724,500
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Net increase (decrease) in net assets from capital share transactions 20,799,225 15,724,500
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Net increase (decrease) in net assets 20,790,749 15,716,107
Net assets at the beginning of period 100,275 100,275
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Net assets at the end of the period $ 20,891,024 $ 15,816,382
=====================================================================================================================
Undistributed net investment income (loss) at the end of the period $ -- $ --
=====================================================================================================================
See accompanying notes to financial statements.
8 Nuveen Investments
| Notes to FINANCIAL STATEMENTS
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The funds covered in this report and their corresponding New York Stock Exchange
Amex symbols are Nuveen New Jersey Municipal Value Fund (NJV) and Nuveen
Pennsylvania Municipal Value Fund (NPN) (collectively, the "Funds"). The Funds
are registered under the Investment Company Act of 1940, as amended, as
closed-end management investment companies.
Prior to the commencement of operations, New Jersey Municipal Value (NJV) and
Pennsylvania Municipal Value (NPN) had no operations other than those related to
organizational matters, the initial capital contribution of $100,275 per Fund by
Nuveen Asset Management (the "Adviser"), a wholly owned subsidiary of Nuveen
Investments, Inc. ("Nuveen"), and the recording of the organization expenses
($15,000 per Fund) and their reimbursement by Nuveen Investments, LLC, also a
wholly owned subsidiary of Nuveen. As the Funds commenced operations on April
28, 2009, the information presented in the financial statements may not be
reflective of the Funds' future operating performance.
Each Fund seeks to provide current income exempt from both regular federal and
designated state income taxes by investing in a portfolio of municipal
obligations issued by state and local government authorities within a single
state or certain U.S. territories.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with US
generally accepted accounting principles.
Investment Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Trustees. When market price
quotes are not readily available (which is usually the case for municipal
securities), the pricing service or, in the absence of a pricing service for a
particular investment, the Board of Trustees of the Fund, or its designee, may
establish fair value using a wide variety of market data including yields or
prices of investments of comparable quality, type of issue, coupon, maturity and
rating, market quotes or indications of value from security dealers, evaluations
of anticipated cash flows or collateral, general market conditions and other
information and analysis, including the obligor's credit characteristics
considered relevant. Temporary investments in securities that have variable rate
and demand features qualifying them as short-term investments are valued at
amortized cost, which approximates value.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and
losses from transactions are determined on the specific identification method.
Investments purchased on a when-issued/delayed delivery basis may have extended
settlement periods. Any investments so purchased are subject to market
fluctuation during this period. The Funds have instructed the custodian to
segregate assets with a current value at least equal to the amount of the
when-issued/delayed delivery purchase commitments. At April 30, 2009, New Jersey
Municipal Value (NJV) had outstanding when issued/delayed delivery purchase
commitments of $1,960,000. There were no such outstanding purchase commitments
in Pennsylvania Municipal Value (NPN).
Investment Income
Interest income, which includes the amortization of premiums and accretion of
discounts for financial reporting purposes, is recorded on an accrual basis.
Investment income also includes paydown gains and losses, if any.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to distribute substantially all of its net investment income and net
capital gains to shareholders and to otherwise comply with the requirements of
Subchapter M of the Internal Revenue Code applicable to regulated investment
companies. Therefore, no federal income tax provision is required. Furthermore,
each Fund intends to satisfy conditions which will enable interest from
municipal securities, which is exempt from regular federal and designated state
income taxes, to retain such tax-exempt status when distributed to shareholders
of the Funds. Net realized capital gains and ordinary income distributions paid
by the Funds are subject to federal taxation.
Nuveen Investments 9
| Notes to FINANCIAL STATEMENTS (continued)
For all open tax years and all major taxing jurisdictions, management of the
Funds has concluded that there are no significant uncertain tax positions that
would require recognition in the financial statements. Open tax years are those
that are open for examination by taxing authorities (i.e., generally the last
four tax year ends and the interim tax period since then). Furthermore,
management of the Funds is also not aware of any tax positions for which it is
reasonably possible that the total amounts of unrecognized tax benefits will
significantly change in the next twelve months.
Dividends and Distributions to Shareholders
Dividends from tax-exempt net investment income are declared monthly. Net
realized capital gains and/or market discount from investment transactions, if
any, are distributed to shareholders at least annually. Furthermore, capital
gains are distributed only to the extent they exceed available capital loss
carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized
capital gains and/or market discount, if any, are recorded on the ex-dividend
date. The amount and timing of distributions are determined in accordance with
federal income tax regulations, which may differ from US generally accepted
accounting principles.
Inverse Floating Rate Securities
Each Fund is authorized to invest in inverse floating rate securities. An
inverse floating rate security is created by depositing a municipal bond,
typically with a fixed interest rate, into a special purpose trust created by a
broker-dealer. In turn, this trust (a) issues floating rate certificates, in
face amounts equal to some fraction of the deposited bond's par amount or market
value, that typically pay short-term tax-exempt interest rates to third parties,
and (b) issues to a long-term investor (such as one of the Funds) an inverse
floating rate certificate (sometimes referred to as an "inverse floater") that
represents all remaining or residual interest in the trust. The income received
by the inverse floater holder varies inversely with the short-term rate paid to
the floating rate certificates' holders, and in most circumstances the inverse
floater holder bears substantially all of the underlying bond's downside
investment risk and also benefits disproportionately from any potential
appreciation of the underlying bond's value. The price of an inverse floating
rate security will be more volatile than that of the underlying bond because the
interest rate is dependent on not only the fixed coupon rate of the underlying
bond but also on the short-term interest paid on the floating rate certificates,
and because the inverse floating rate security essentially bears the risk of
loss of the greater face value of the underlying bond.
A Fund may purchase an inverse floating rate security in a secondary market
transaction without first owning the underlying bond (referred to as an
"externally-deposited inverse floater"), or instead by first selling a
fixed-rate bond to a broker-dealer for deposit into the special purpose trust
and receiving in turn the residual interest in the trust (referred to as a
"self-deposited inverse floater"). The inverse floater held by a Fund gives the
Fund the right (a) to cause the holders of the floating rate certificates to
tender their notes at par, and (b) to have the broker transfer the fixed-rate
bond held by the trust to the Fund, thereby collapsing the trust. An investment
in an externally-deposited inverse floater is identified in the Portfolio of
Investments as "IF - Inverse floating rate investment." An investment in a
self-deposited inverse floater is accounted for as a financing transaction in
accordance with Statement of Financial Accounting Standards No. 140 (SFAS No.
140) "Accounting for Transfers and Servicing of Financial Assets and
Extinguishment of Liabilities." In such instances, a fixed-rate bond deposited
into a special purpose trust is identified in the Portfolio of Investments as
"(UB) - Underlying bond of an inverse floating rate trust," with the Fund
accounting for the short-term floating rate certificates issued by the trust as
"Floating rate obligations" on the Statement of Assets and Liabilities. In
addition, the Fund reflects in "Investment Income" the entire earnings of the
underlying bond and the related interest paid to the holders of the short-term
floating rate certificates is recognized as "Interest expense on floating rate
obligations" on the Statement of Operations.
Each Fund may also enter into shortfall and forbearance agreements (sometimes
referred to as a "recourse trust" or "credit recovery swap") (such agreements
referred to herein as "Recourse Trusts") with a broker-dealer by which a Fund
agrees to reimburse the broker-dealer, in certain circumstances, for the
difference between the liquidation value of the fixed-rate bond held by the
trust and the liquidation value of the floating rate certificates issued by the
trust plus any shortfalls in interest cash flows. Under these
10 Nuveen Investments
agreements, a Fund's potential exposure to losses related to or on inverse
floaters may increase beyond the value of a Fund's inverse floater investments
as a Fund may potentially be liable to fulfill all amounts owed to holders of
the floating rate certificates. At period end, any such shortfall is recognized
as "Unrealized depreciation on Recourse Trusts" on the Statement of Assets and
Liabilities.
During the period April 28, 2009 (commencement of operations) through April 30,
2009, the Funds did not invest in inverse floating rate securities.
Derivative Financial Instruments
Each Fund is authorized to invest in certain derivative financial instruments
including forwards, futures, options and swap contracts. Although each Fund is
authorized to invest in such financial instruments, and may do so in the future,
they did not make any such investments during the period April 28, 2009
(commencement of operations) through April 30, 2009.
Organization and Offering Costs
Nuveen Investments, LLC has agreed to reimburse all organization expenses
($15,000 per Fund) and pay all offering costs (other than the sales load) that
exceed $.03 per share for New Jersey Municipal Value (NJV) and Pennsylvania
Municipal Value (NPN). New Jersey Municipal Value's (NJV) and Pennsylvania
Municipal Value's (NPN) share of offering costs ($43,650 and $33,000,
respectively) were recorded as reductions of the proceeds from the sale of
shares.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by net credits earned on each Fund's cash on
deposit with the bank. Such deposit arrangements are an alternative to overnight
investments. Credits for cash balances may be offset by charges for any days on
which a Fund overdraws its account at the custodian bank.
Indemnifications
Under the Funds' organizational documents, their Officers and Trustees are
indemnified against certain liabilities arising out of the performance of their
duties to the Funds. In addition, in the normal course of business, the Funds
enter into contracts that provide general indemnifications to other parties. The
Funds' maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Funds that have not yet
occurred. However, the Funds have not had prior claims or losses pursuant to
these contracts and expect the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with US generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of increases and decreases in net
assets applicable to Common shares from operations during the reporting period.
Actual results may differ from those estimates.
2. FAIR VALUE MEASUREMENTS
In determining the value of each Fund's investments various inputs are used.
These inputs are summarized in the three broad levels listed below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit risk,
etc.).
Level 3 - Significant unobservable inputs (including management's assumptions
in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of
the risk associated with investing in those securities. The following is a
summary of New Jersey Municipal Value's (NUJ) fair value measurements as of
April 30, 2009:
NEW JERSEY MUNICIPAL VALUE (NJV) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
- --------------------------------------------------------------------------------------
Investments $ -- $ 1,960,000 $ -- $ 1,960,000
======================================================================================
3. FUND SHARES
Transactions in Fund shares for the period April 28, 2009 (commencement of
operations) through April 30, 2008, were as follows:
NEW JERSEY PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
(NJV) (NPN)
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Shares sold 1,455,000 1,100,000
================================================================================
Nuveen Investments 11
| Notes to FINANCIAL STATEMENTS (continued)
4. INVESTMENT TRANSACTIONS
Purchases and sales of investments during the period April 28, 2009
(commencement of operations) through April 30, 2009, were as follows:
NEW JERSEY PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
(NJV) (NPN)
- --------------------------------------------------------------------------------
Purchases $ 1,960,000 $ --
Sales -- --
================================================================================
5. INCOME TAX INFORMATION
The following information is presented on an income tax basis. Differences
between amounts for financial statement and federal income tax purposes are
primarily due to timing differences in recognizing taxable market discount,
timing differences in recognizing certain gains and losses on investment
transactions and the treatment of investments in inverse floating rate
transactions subject to SFAS No. 140, if any. To the extent that differences
arise that are permanent in nature, such amounts are reclassified within the
capital accounts on the Statement of Assets and Liabilities presented in the
annual report, based on their federal tax basis treatment; temporary differences
do not require reclassification. Temporary and permanent differences do not
impact the net asset values of the Funds.
At April 30, 2009, the cost of investments was as follows:
NEW JERSEY PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
(NJV) (NPN)
- --------------------------------------------------------------------------------
Cost of investments $ 1,960,000 $ --
================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at April 30, 2009, were as follows:
NEW JERSEY PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
(NJV) (NPN)
- --------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ -- $ --
Depreciation -- --
- --------------------------------------------------------------------------------
Net unrealized appreciation (depreciation)
of investments $ -- $ --
================================================================================
The tax components of undistributed net tax-exempt income, net ordinary income
and net long-term capital gains at April 30, 2009, the Funds' tax year end, were
as follows:
NEW JERSEY PENNSYLVANIA
MUNICIPAL VALUE MUNICIPAL VALUE
(NJV) (NPN)
- --------------------------------------------------------------------------------
Undistributed net tax-exempt income $ -- $ --
Undistributed net ordinary income * -- --
Undistributed net long-term capital gains -- --
================================================================================
* Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
During the period April 28, 2009 (commencement of operations) through April 30,
2009, the Funds made no distributions to their shareholders.
As of April 30, 2009 the Funds had no capital loss carryforwards or deferred
post-October losses.
12 Nuveen Investments
6. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Each Fund's management fee is separated into two components - a complex-level
component, based on the aggregate amount of all fund assets managed by the
Adviser, and a specific fund-level component, based only on the amount of assets
within each individual Fund. This pricing structure enables Nuveen fund
shareholders to benefit from growth in the assets within each individual fund as
well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee, payable monthly, for each Fund is based upon the
average daily managed assets of each Fund as follows:
NEW JERSEY MUNICIPAL VALUE (NJV)
PENNSYLVANIA MUNICIPAL VALUE (NPN)
AVERAGE DAILY MANAGED NET ASSETS (1) FUND-LEVEL FEE RATE
- --------------------------------------------------------------------------------
For the first $125 million .4000%
For the next $125 million .3875
For the next $250 million .3750
For the next $500 million .3625
For the next $1 billion .3500
For net assets over $2 billion .3375
================================================================================
The annual complex-level fee, payable monthly, which is additive to the
fund-level fee, for all Nuveen sponsored funds in the U.S., is based on the
aggregate amount of total fund assets managed as stated in the following table.
As of April 30, 2009, the complex-level fee rate was .1998%.
The complex-level fee schedule is as follows:
EFFECTIVE RATE
COMPLEX-LEVEL NET ASSETS BREAKPOINT LEVEL (1) AT BREAKPOINT LEVEL
- --------------------------------------------------------------------------------
$55 billion .2000%
$56 billion .1996
$57 billion .1989
$60 billion .1961
$63 billion .1931
$66 billion .1900
$71 billion .1851
$76 billion .1806
$80 billion .1773
$91 billion .1691
$125 billion .1599
$200 billion .1505
$250 billion .1469
$300 billion .1445
================================================================================
(1) The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate daily managed net assets of all Nuveen
funds, with such daily managed net assets defined separately for each fund
in its management agreement, but excluding assets attributable to
investments in other Nuveen funds. For the complex-level and fund-level
fee components, daily managed net assets includes assets managed by the
Adviser that are attributable to each fund's use of financial leverage.
For these purposes, financial leverage includes the funds' use of
preferred stock and borrowings and investments in the residual interest
certificates (also called inverse floating rate securities) in tender
option bond (TOB) trusts, including the portion of assets held by the TOB
trust that has been effectively financed by the trust's issuance of
floating rate securities, subject to an agreement by the Adviser to limit
the amount of such assets for determining managed net assets in certain
circumstances.
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to those of its Trustees who are affiliated with the
Adviser or to its Officers, all of whom receive remuneration for their services
to the Funds from the Adviser or its affiliates. The Board of Trustees has
adopted a deferred compensation plan for independent Trustees that enables
Trustees to elect to defer receipt of all or a portion of the annual
compensation they are entitled to receive from certain Nuveen advised funds.
Under the plan, deferred amounts are treated as though equal dollar amounts had
been invested in shares of select Nuveen advised funds.
Nuveen Investments 13
| Notes to FINANCIAL STATEMENTS (continued)
7. NEW ACCOUNTING PRONOUNCEMENTS
Financial Accounting Standards Board Staff Position No. 157-4 (FSP No. 157-4)
On April 9, 2009, the Financial Accounting Standards Board issued FSP No. 157-4,
"Determining Fair Value When the Volume and Level of Activity for the Asset or
Liability Have Significantly Decreased and Identifying Transactions That Are Not
Orderly." FSP No. 157-4 provides additional guidance for estimating fair value
in accordance with SFAS No. 157, "Fair Value Measurements," when the volume and
level of activity for the asset or liability have significantly decreased. FSP
No. 157-4 also requires additional disaggregation of the current SFAS No. 157
required disclosures. FSP No. 157-4 is effective for interim and annual
reporting periods ending after June 15, 2009, and shall be applied
prospectively. At this time, management is evaluating the implications of FSP
No. 157-4 and the impact it will have on the financial statement disclosures.
14 Nuveen Investments
| Financial HIGHLIGHTS
Nuveen Investments 15
| Financial HIGHLIGHTS
Selected data for a share outstanding throughout each period:
Investment Operations Less Distributions
----------------------------------- ---------------------------
Net
Beginning Net Realized/ Net Ending Ending
Net Asset Investment Unrealized Investment Capital Offering Net Asset Market
Value Income (Loss) Gain (Loss) Total Income Gains Total Costs Value Value
- ----------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY MUNICIPAL
VALUE (NJV)
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended 4/30:
2009(b) $ 14.33 $ (.01) $ -- $ (.01) $ -- $ -- $ -- $ (.03) $ 14.29 $ 15.00
PENNSYLVANIA MUNICIPAL
VALUE (NPN)
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended 4/30:
2009(b) 14.33 (.01) -- (.01) -- -- -- (.03) 14.29 15.05
==================================================================================================================================
16 Nuveen Investments
Ratios/Supplemental Data
-------------------------------------------------------------------
Total Returns Ratios to Average Net Assets
-------------------- ----------------------------------------
Ending
Based on Based on Net Expenses Expenses Net Portfolio
Market Net Asset Assets Including Excluding Investment Turnover
Value* Value* (000) Interest(a) Interest(a) Income (Loss) Rate
- ------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY MUNICIPAL VALUE (NJV)
- ------------------------------------------------------------------------------------------------------------------------------
Year Ended 4/30:
2009(b) --% (.24)% $ 20,891 .64%** .64%** (.64)%** --%
- ------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA MUNICIPAL VALUE (NPN)
- ------------------------------------------------------------------------------------------------------------------------------
Year Ended 4/30:
2009(b) .33 (.31) 15,816 .66** .66** (.66)** --
==============================================================================================================================
* Total Return Based on Market Value is the combination of changes in the
market price per share and the effect of reinvested dividend income and
reinvested capital gains distributions, if any, at the average price paid
per share at the time of reinvestment. Total returns are not annualized.
Total Return Based on Net Asset Value is the combination of changes in net
asset value, reinvested dividend income at net asset value and reinvested
capital gains distributions at net asset value, if any. Total returns are
not annualized.
** Annualized.
(a) Interest expense arises from the application of SFAS No. 140 to certain
inverse floating rate transactions entered into by the Fund as more fully
described in Footnote 1 - Inverse Floating Rate Securities.
(b) For the period April 28, 2009 (commencement of operations) through April
30, 2009.
See accompanying notes to financial statements.
Nuveen Investments 17
Board Members & Officers
- --------------------------------------------------------------------------------
The management of the Funds, including general supervision of the duties
performed for the Funds by the Adviser, is the responsibility of the Board
Members of the Funds. The number of board members of the Fund is currently set
at nine. None of the board members who are not "interested" persons of the Funds
(referred to herein as "independent board members") has ever been a director or
employee of, or consultant to, Nuveen or its affiliates. The names and business
addresses of the board members and officers of the Funds, their principal
occupations and other affiliations during the past five years, the number of
portfolios each oversees and other directorships they hold are set forth below.
NUMBER PRINCIPAL
YEAR FIRST OF PORTFOLIOS OCCUPATION(S)
NAME, ELECTED OR IN FUND COMPLEX INCLUDING OTHER
BIRTHDATE POSITION(S) HELD APPOINTED OVERSEEN BY DIRECTORSHIPS
& ADDRESS WITH THE FUNDS AND TERM(1) BOARD MEMBER DURING PAST 5 YEARS
- ------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS:
o ROBERT P. BREMNER
8/22/40 Chairman of 1997 200 Private Investor and Management Consultant;
333 W. Wacker Drive the Board Treasurer and Director, Humanities Council of
Chicago, IL 60606 and Board Member Washington D.C.
o JACK B. EVANS
10/22/48 Board Member 1999 200 President, The Hall-Perrine Foundation, a private
333 W. Wacker Drive philanthropic corporation (since 1996); Director
Chicago, IL 60606 and Vice Chairman, United Fire Group, a publicly
held company; Member of the Board of Regents for
the State of Iowa University System; Director,
Gazette Companies; Life Trustee of Coe College;
Director, Iowa College Foundation; Member of the
Advisory Council of the Department of Finance in
the Tippie College of Business, University of
Iowa; formerly, Director, Alliant Energy;
formerly, Director, Federal Reserve Bank of
Chicago; formerly, President and Chief Operating
Officer, SCI Financial Group, Inc., a regional
financial services firm.
o WILLIAM C. HUNTER
3/6/48 Board Member 2004 200 Dean, Tippie College of Business, University of
333 W. Wacker Drive Iowa (since 2006); Director (since 2004) of Xerox
Chicago, IL 60606 Corporation; Director (since 2005), Beta Gamma
Sigma International Honor Society; formerly, Dean
and Distinguished Professor of Finance, School of
Business at the University of Connecticut
(2003-2006); previously, Senior Vice President and
Director of Research at the Federal Reserve Bank
of Chicago (1995-2003); Director, SS&C
Technologies, Inc. (May 2005-October 2005);
formerly, Director (1997-2007), Credit Research
Center at Georgetown University.
o DAVID J. KUNDERT
10/28/42 Board Member 2005 200 Director, Northwestern Mutual Wealth Management
333 W. Wacker Drive Company; retired (since 2004) as Chairman,
Chicago, IL 60606 JPMorgan Fleming Asset Management, President and
CEO, Banc One Investment Advisors Corporation, and
President, One Group Mutual Funds; prior thereto,
Executive Vice President, Banc One Corporation and
Chairman and CEO, Banc One Investment Management
Group; Member, Board of Regents, Luther College;
member of the Wisconsin Bar Association; member of
Board of Directors, Friends of Boerner Botanical
Gardens; member of Investment Committee, Greater
Milwaukee Foundation.
o WILLIAM J. SCHNEIDER
9/24/44 Board Member 1997 200 Chairman of Miller-Valentine Partners Ltd., a real
333 W. Wacker Drive estate investment company; formerly, Senior
Chicago, IL 60606 Partner and Chief Operating Officer (retired,
2004) of Miller-Valentine Group; member,
University of Dayton Business School Advisory
Council; member, Dayton Philharmonic Orchestra
Association; formerly, member, Business Advisory
Council, Cleveland Federal Reserve Bank; formerly,
Director, Dayton Development Coalition.
18 Nuveen Investments
NUMBER PRINCIPAL
YEAR FIRST OF PORTFOLIOS OCCUPATION(S)
NAME, ELECTED OR IN FUND COMPLEX INCLUDING OTHER
BIRTHDATE POSITION(S) HELD APPOINTED OVERSEEN BY DIRECTORSHIPS
& ADDRESS WITH THE FUNDS AND TERM(1) BOARD MEMBER DURING PAST 5 YEARS
- ------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS:
o JUDITH M. STOCKDALE
12/29/47 Board Member 1997 200 Executive Director, Gaylord and Dorothy Donnelley
333 W. Wacker Drive Foundation (since 1994); prior thereto, Executive
Chicago, IL 60606 Director, Great Lakes Protection Fund (from 1990
to 1994).
o CAROLE E. STONE
6/28/47 Board Member 2007 200 Director, Chicago Board Options Exchange (since
333 W. Wacker Drive 2006); Commissioner, New York State Commission on
Chicago, IL 60606 Public Authority Reform (since 2005); formerly,
Chair, New York Racing Association Oversight Board
(2005-2007).
o TERENCE J. TOTH
9/29/59 Board Member 2008 200 Director, Legal & General Investment Management
333 W. Wacker Drive America, Inc. (since 2008); Managing Partner,
Chicago, IL 60606 Musso Capital Management (since 2008); Private
Investor (since 2007); CEO and President, Northern
Trust Investments (2004-2007); Executive Vice
President, Quantitative Management & Securities
Lending (2004-2007); prior thereto, various
positions with Northern Trust Company (since
1994); Member: Goodman Theatre Board (since 2004),
Chicago Fellowship Boards (since 2005), University
of Illinois Leadership Council Board (since 2007)
and Catalyst Schools of Chicago Board (since
2008); formerly, Member: Northern Trust Mutual
Funds Board (2005-2007), Northern Trust
Investments Board (2004-2007), Northern Trust
Japan Board (2004-2007), Northern Trust Securities
Inc. Board (2003-2007) and Northern Trust Hong
Kong Board (1997-2004).
INTERESTED BOARD MEMBER:
o JOHN P. AMBOIAN(2)
6/14/61 Board Member 2008 200 Chief Executive Officer (since July 2007) and
333 W. Wacker Drive Director (since 1999) of Nuveen Investments, Inc.;
Chicago, IL 60606 Chief Executive Officer (since 2007) of Nuveen
Asset Management, Nuveen Investments Advisors,
Inc. formerly, President (1999-2004) of Nuveen
Advisory Corp. and Nuveen Institutional Advisory
Corp.(3)
Nuveen Investments 19
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
- ------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
o GIFFORD R. ZIMMERMAN
9/9/56 Chief 1988 200 Managing Director (since 2002), Assistant
333 W. Wacker Drive Administrative Secretary and Associate General Counsel of Nuveen
Chicago, IL 60606 Officer Investments, LLC; Managing Director, Associate
General Counsel and Assistant Secretary, of Nuveen
Asset Management and of Symphony Asset Management
LLC, (since 2003); Vice President and Assistant
Secretary of NWQ Investment Management Company,
LLC. (since 2002), Nuveen Investments Advisers
Inc. (since 2002), Tradewinds Global Investors,
LLC, and Santa Barbara Asset Management, LLC
(since 2006), Nuveen HydePark Group LLC and Nuveen
Investment Solutions, Inc. (since 2007); Managing
Director (since 2004) and Assistant Secretary
(since 1994) of Nuveen Investments, Inc.;
formerly, Managing Director (2002- 2004), General
Counsel (1998-2004) and Assistant Secretary of
Nuveen Advisory Corp. and Nuveen Institutional
Advisory Corp.(3); Chartered Financial Analyst.
o WILLIAM ADAMS IV
6/9/55 Vice President 2007 125 Executive Vice President of Nuveen Investments,
333 W. Wacker Drive Inc.; Executive Vice President, U.S. Structured
Chicago, IL 60606 Products of Nuveen Investments, LLC, (since 1999),
prior thereto, Managing Director of Structured
Investments.
o MARK J.P. ANSON
6/10/59 Vice President 2009 200 President and Executive Director of Nuveen
333 W. Wacker Drive Investments, Inc. (since 2007); President of
Chicago, IL 60606 Nuveen Investments Institutional Services Group
LLC (since 2007); previously, Chief Executive
Officer of the British Telecom Pension Scheme
(2006-2007) and Chief Investment Officer of
Calpers (1999-2006); PhD, Chartered Financial
Analyst, Chartered Alternative Investment Analyst,
Certified Public Accountant, Certified Management
Accountant and Certified Internal Auditor.
o CEDRIC H. ANTOSIEWICZ
1/11/62 Vice President 2007 125 Managing Director, (since 2004), previously, Vice
333 W. Wacker Drive President (1993-2004) of Nuveen Investments, LLC.
Chicago, IL 60606
o NIZIDA ARRIAGA
6/1/68 Vice President 2009 200 Vice President (since 2007) of Nuveen Investments,
333 W. Wacker Drive LLC; previously, Portfolio Manager, Allstate
Chicago, IL 60606 Investments, LLC (1996-2006); Chartered Financial
Analyst.
o MICHAEL T. ATKINSON
2/3/66 Vice President 2000 200 Vice President (since 2002) of Nuveen Investments,
333 W. Wacker Drive and Assistant LLC.; Vice President of Nuveen Asset Management
Chicago, IL 60606 Secretary (since 2005).
o MARGO L. COOK
4/11/64 Vice President 2009 200 Executive Vice President (since Oct 2008) of
333 W. Wacker Drive Nuveen Investments, Inc.; previously, Head of
Chicago, IL 60606 Institutional Asset Management (2007-2008) of Bear
Stearns Asset Management; Head of Institutional
Asset Mgt (1986-2007) of Bank of NY Mellon;
Chartered Financial Analyst.
o LORNA C. FERGUSON
10/24/45 Vice President 1998 200 Managing Director (since 2004), formerly, Vice
333 W. Wacker Drive President of Nuveen Investments, LLC; Managing
Chicago, IL 60606 Director (since 2005) of Nuveen Asset Management;
Managing Director (2004-2005), formerly, Vice
President (1998-2004) of Nuveen Advisory Corp. and
Nuveen Institutional Advisory Corp.(3)
20 Nuveen Investments
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
- ------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
o STEPHEN D. FOY
5/31/54 Vice President 1998 200 Vice President (since 1993) and Funds Controller
333 W. Wacker Drive and Controller (since 1998) of Nuveen Investments, LLC; Vice
Chicago, IL 60606 President (since 2005) of Nuveen Asset Management;
Certified Public Accountant.
o WILLIAM T. HUFFMAN
5/7/69 Vice President 2009 200 Chief Operating Officer, Municipal Fixed Income
333 W. Wacker Drive (since 2008) of Nuveen Asset Management;
Chicago, IL 60606 previously, Chairman, President and Chief
Executive Officer (2002 - 2007) of Northern Trust
Global Advisors, Inc. and Chief Executive Officer
(2007) of Northern Trust Global Investments
Limited; CPA.
o WALTER M. KELLY
2/24/70 Chief Compliance 2003 200 Senior Vice President (since 2008), Vice President
333 W. Wacker Drive Officer and (2006-2008) formerly, Assistant Vice President and
Chicago, IL 60606 Vice President Assistant General Counsel (2003-2006) of Nuveen
Investments, LLC; Vice President (since 2006) and
Assistant Secretary (since 2008) of Nuveen Asset
Management.
o DAVID J. LAMB
3/22/63 Vice President 2000 200 Senior Vice President (since 2009), formerly, Vice
333 W. Wacker Drive President (2000-2009) of Nuveen Investments, LLC;
Chicago, IL 60606 Vice President (since 2005) of Nuveen Asset
Management; Certified Public Accountant.
o TINA M. LAZAR
8/27/61 Vice President 2002 200 Senior Vice President (since 2009), formerly, Vice
333 W. Wacker Drive President of Nuveen Investments, LLC (1999-2009);
Chicago, IL 60606 Vice President of Nuveen Asset Management (since
2005).
o LARRY W. MARTIN
7/27/51 Vice President 1988 200 Vice President, Assistant Secretary and Assistant
333 W. Wacker Drive and Assistant General Counsel of Nuveen Investments, LLC; Vice
Chicago, IL 60606 Secretary President (since 2005) and Assistant Secretary of
Nuveen Investments, Inc.; Vice President (since
2005) and Assistant Secretary (since 1997) of
Nuveen Asset Management; Vice President and
Assistant Secretary of Nuveen Investments Advisers
Inc. (since 2002); NWQ Investment Management
Company, LLC (since 2002), Symphony Asset
Management LLC (since 2003), Tradewinds Global
Investors, LLC, Santa Barbara Asset Management LLC
(since 2006) and of Nuveen HydePark Group, LLC and
Nuveen Investment Solutions, Inc. (since 2007);
formerly, Vice President and Assistant Secretary
of Nuveen Advisory Corp. and Nuveen Institutional
Advisory Corp.(3)
o KEVIN J. MCCARTHY
3/26/66 Vice President 2007 200 Managing Director (since 2008), formerly, Vice
333 W. Wacker Drive and Secretary President (2007-2008), Nuveen Investments, LLC;
Chicago, IL 60606 Managing Director (since 2008), formerly, Vice
President, and Assistant Secretary, Nuveen Asset
Management, and Nuveen Investments Holdings, Inc.;
Vice President (since 2007) and Assistant
Secretary, Nuveen Investment Advisers Inc., Nuveen
Investment Institutional Services Group LLC, NWQ
Investment Management Company, LLC, Tradewinds
Global Investors LLC, NWQ Holdings, LLC, Symphony
Asset Management LLC, Santa Barbara Asset
Management LLC, Nuveen HydePark Group, LLC and
Nuveen Investment Solutions, Inc. (since 2007);
prior thereto, Partner, Bell, Boyd & Lloyd LLP
(1997-2007).
Nuveen Investments 21
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
- ------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
JOHN V. MILLER
4/10/67 Vice President 2007 200 Managing Director (since 2007), formerly, Vice
333 W. Wacker Drive President (2002-2007) of Nuveen Asset Management
Chicago, IL 60606 and Nuveen Investments, LLC; Chartered Financial
Analyst.
GREGORY MINO
1/4/71 Vice President 2009 200 Vice President of Nuveen Investments, LLC (since
333 W. Wacker Drive 2008); previously, Director (2004-2007) and
Chicago, IL 60606 Executive Director (2007-2008) of UBS Global Asset
Management; previously, Vice President (2000-2003)
and Director (2003-2004) of Merrill Lynch
Investment Managers; Chartered Financial Analyst.
CHRISTOPHER M. ROHRBACHER
8/1/71 Vice President 2008 200 Vice President, Nuveen Investments, LLC (since
333 W. Wacker Drive and Assistant 2008); Vice President and Assistant Secretary,
Chicago, IL 60606 Secretary Nuveen Asset Management (since 2008); prior
thereto, Associate, Skadden, Arps, Slate Meagher &
Flom LLP (2002-2008).
JAMES F. RUANE
7/3/62 Vice President 2007 200 Vice President, Nuveen Investments, LLC (since
333 W. Wacker Drive and Assistant 2007); prior thereto, Partner, Deloitte & Touche
Chicago, IL 60606 Secretary USA LLP (2005-2007), formerly, senior tax manager
(2002-2005); Certified Public Accountant.
MARK L. WINGET
12/21/68 Vice President 2008 200 Vice President, Nuveen Investments, LLC (since
333 W. Wacker Drive and Assistant 2008); Vice President and Assistant Secretary,
Chicago, IL 60606 Secretary Nuveen Asset Management (since 2008); prior
thereto, Counsel, Vedder Price P.C. (1997-2007).
(1) Board Members serve a one year term to serve until the next annual meeting
or until their successors shall have been duly elected and qualified. The
first year elected or appointed represents the year in which the board
member was first elected or appointed to any fund in the Nuveen Complex.
(2) Mr. Amboian is an interested trustee because of his position with Nuveen
Investments, Inc. and certain of its subsidiaries, which are affiliates of
the Nuveen Funds.
(3) Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. were
reorganized into Nuveen Asset Management, effective January 1, 2005.
(4) Officers serve one year terms through July of each year. The year first
elected or appointed represents the year in which the Officer was first
elected or appointed to any fund in the Nuveen Complex.
22 Nuveen Investments
Annual Investment Management Agreement Approval Process
The Board of Trustees (the "Board," and each Trustee, a "Board Member") of the
Funds is responsible for approving the Funds' advisory arrangements and, at
meetings held on February 27, 2009 and March 16, 2009 (collectively, the
"Meeting"), the Board Members, including the Board Members who are not parties
to the investment management agreement or "interested persons" of any such party
(the "Independent Board Members") considered and approved the investment
management agreement (each, an "Investment Management Agreement") between each
Fund and Nuveen Asset Management ("NAM").
To assist the Board in its evaluation of the Investment Management Agreements at
the Meeting, the Independent Board Members had received, in adequate time in
advance of the Meeting or at prior meetings, materials which outlined, among
other things:
o the nature, extent and quality of services expected to be provided by NAM;
o the organization of NAM, including the responsibilities of various
departments and key personnel;
o the expertise and background of NAM with respect to the applicable Fund's
investment strategy;
o the performance records of NAM and of certain similar Nuveen funds (as
described below);
o the profitability of Nuveen Investments, Inc. ("Nuveen") (which
incorporated Nuveen's wholly-owned affiliated sub-advisers);
o the proposed management fees of NAM, including comparisons of such fees
with the management fees of comparable, unaffiliated funds, as well as
comparable, affiliated funds;
o the advisory fees NAM assesses to other types of investment products or
clients;
o the expected expenses of each Fund, including comparisons of the Fund's
expected expense ratio with the expense ratios of comparable, unaffiliated
funds, as well as comparable, affiliated funds; and
o the soft dollar practices of NAM, if any.
At the Meeting, NAM made a presentation to and responded to questions from the
Board. During the Meeting, the Independent Board Members also met privately with
their legal counsel to review the Board's duties under the Investment Company
Act of 1940 (the "1940 Act"), the general principles of state law in reviewing
and approving advisory contracts, the standards used by courts in determining
whether investment company boards of directors have fulfilled their duties,
factors to be considered in voting on advisory contracts and an adviser's
fiduciary duty with respect to advisory
Nuveen Investments 23
Annual Investment Management Agreement Approval Process (continued)
agreements and compensation. It is with this background that the Independent
Board Members considered the advisory agreement with NAM for the applicable
Fund. As outlined in more detail below, the Independent Board Members considered
all factors they believed relevant with respect to each Fund, including the
following: (a) the nature, extent and quality of the services to be provided by
NAM; (b) investment performance, as described below; (c) the profitability of
Nuveen and its affiliates; (d) the extent to which economies of scale would be
realized; and (e) whether fee levels reflect these economies of scale for the
benefit of Fund investors.
A. NATURE, EXTENT AND QUALITY OF SERVICES
The Independent Board Members considered the nature, extent and quality of NAM's
services, including advisory services and administrative services. As NAM
already serves as adviser to other Nuveen funds overseen by the Board Members,
the Board has a good understanding of NAM's organization, operations and
personnel. As the Independent Board Members meet regularly throughout the year
to oversee the Nuveen funds, including funds currently advised by NAM, the
Independent Board Members have relied upon their knowledge from their meetings
and any other interactions throughout the year of NAM and its services in
evaluating the Investment Management Agreements.
At the Meeting and at prior meetings, the Independent Board Members reviewed
materials outlining, among other things, Nuveen's organization and business; the
types of services that NAM or its affiliates provide to the Nuveen funds and are
expected to provide to the Funds; and NAM's experience with applicable
investment strategies. The Independent Board Members further evaluated the
professional experience, qualifications and credentials of NAM's investment
personnel.
In addition to advisory services, the Independent Board Members considered the
quality of any administrative or non-advisory services to be provided. In this
regard, NAM is expected to provide the Funds with such administrative and other
services (exclusive of, and in addition to, any such services provided by others
for the Funds) and officers and other personnel as are necessary for the
operations of the Funds. In addition to investment management services, NAM and
its affiliates will provide the Funds with a wide range of services, including,
among other things, product management, fund administration, oversight of
service providers, shareholder services, administration of Board relations,
regulatory and portfolio compliance and legal support.
In addition to the foregoing services, the Independent Board Members also noted
the additional services that NAM or its affiliates provide to closed-end funds,
including, in particular, its secondary market support activities and the costs
of such activities. The Independent Board Members have recognized Nuveen's
continued commitment to supporting the secondary market for the common shares of
its closed-end funds through a variety of programs designed to raise investor
and analyst awareness and understanding of closed-end funds. These efforts
include maintaining an investor relations program to timely provide information
and education to financial advisers and investors; providing advertising and
marketing for the closed-end funds; maintaining its closed-end fund website; and
providing educational seminars.
24 Nuveen Investments
Based on their review, the Independent Board Members found that, overall, the
nature, extent and quality of services expected to be provided to the respective
Fund under the Investment Management Agreement were satisfactory.
B. INVESTMENT PERFORMANCE
Each Fund is new and therefore does not have its own performance history.
However, the Independent Board Members are familiar with NAM's performance
record on other Nuveen funds, and the Funds are expected to employ a
substantially similar investment philosophy and strategies that have guided two
other Nuveen state municipal closed-end funds (specifically, the Nuveen New York
Municipal Value Fund (NNY) and the Nuveen California Municipal Value Fund
(NCA)). Accordingly, the Board Members were provided with certain performance
information for these comparable funds, including calendar year total returns
for the years 2000 through 2008.
C. FEES, EXPENSES AND PROFITABILITY
1. FEES AND EXPENSES
In evaluating the management fees and expenses that a Fund was expected to
bear, the Independent Board Members considered, among other things, the
respective Fund's proposed management fee structure and its expected
expense ratios in absolute terms as well as compared with the fees and
expense ratios of comparable, unaffiliated funds and comparable,
affiliated funds. In this regard, the Independent Board Members noted the
limited universe of municipal funds with an unleveraged capital structure,
and the even more limited universe of state municipal funds with an
unleveraged capital structure (i.e., none other than for the states of
California and New York), which made it difficult to make peer group
comparisons.
In addition, the Funds were not expected to issue preferred shares or debt
instruments; however, the Board Members noted that the Funds may make
investments in inverse floating rate securities (including inverse
floating rate securities representing interests in so-called "tender
option bond trusts" formed by third-party sponsors for the purpose of
holding municipal bonds). The Independent Board Members recognized that
assets financed through the creation of tender option bond trusts in which
a Fund may invest or other financial leverage used would be included in
the amount of assets upon which the advisory fee is calculated. In this
regard, the Independent Board Members noted that the advisory fee is based
on a percentage of average daily "Managed Assets." "Managed Assets"
generally means the total assets of a Fund (including assets attributable
to the Fund's use of financial leverage such as, but not limited to,
proceeds from tender option bond trusts) minus the sum of accrued
liabilities (other than Fund liabilities incurred for the express purpose
of creating financial leverage). Accordingly, the advisory fees paid to
NAM for investment advisory services will be higher if the Fund uses
financial leverage, which may create a conflict of interest between NAM
and the Funds' respective shareholders. This methodology is consistent
with that used on Nuveen taxable leveraged funds and a Nuveen national
municipal closed-end fund with a similar capital structure. The
Independent Board Members also considered the fund-level breakpoint
Nuveen Investments 25
Annual Investment Management Agreement Approval Process (continued)
schedule and the complex-wide breakpoint schedule (described in further
detail below) and any applicable expense reimbursements to be provided.
Based on their review of the fee and expense information provided, the
Independent Board Members determined that each Fund's management fees and
net total expense ratio were reasonable in light of the nature, extent and
quality of services to be provided to the respective Fund.
2. COMPARISONS WITH THE FEES OF OTHER CLIENTS
Due to their experience with other Nuveen funds, the Board Members were
familiar with the fees NAM assesses to other clients of Nuveen or its
affiliates, including NAM's municipal separately managed accounts. In
evaluating the comparisons of fees, the Independent Board Members have
noted, at the Meeting or at prior meetings, that the fee rates charged to
a fund (such as the Funds) and charged to other clients vary, among other
things, because of the different services involved and the additional
regulatory and compliance requirements associated with registered
investment companies, such as the Funds. Accordingly, the Independent
Board Members have considered the differences in the product types,
including, but not limited to, the services to be provided, the structure
and operations, product distribution and costs thereof, portfolio
investment policies, investor profiles, account sizes and regulatory
requirements. The Independent Board Members have noted, in particular,
that the range of services as described above to be provided to a fund
(such as the Funds) is much more extensive than that provided to
separately managed accounts. Given the inherent differences in the
products, particularly the extensive services to be provided to a fund,
the Independent Board Members believe such facts justify the different
levels of fees.
3. PROFITABILITY OF NUVEEN
In conjunction with its review of fees at prior meetings, the Independent
Board Members have considered the profitability of Nuveen for its advisory
activities (which incorporated Nuveen's wholly-owned affiliated
sub-advisers) and its financial condition. At the Meeting or prior
meetings, the Independent Board Members reviewed the revenues and expenses
of Nuveen's advisory activities and the allocation methodology used in
preparing the profitability data.
The Independent Board Members have also considered, at the Meeting or at
prior meetings, Nuveen's profitability compared with other fund sponsors
prepared by two independent third party service providers as well as
comparisons of the revenues, expenses and profit margins of various
unaffiliated management firms with similar amounts of assets under
management prepared by Nuveen.
In reviewing profitability, the Independent Board Members have recognized
the subjective nature of determining profitability, which may be affected
by numerous factors, including the allocation of expenses. Further, the
Independent Board Members have recognized the difficulties in making
comparisons as the profitability of other advisers generally is not
publicly available and the profitability information that is available for
certain advisers or management firms may not be representative of the
industry and may be affected by, among other things, the adviser's
particular business mix, capital costs, types of funds managed and expense
allocations.
26 Nuveen Investments
Notwithstanding the foregoing, the Independent Board Members reviewed
Nuveen's methodology and assumptions for allocating expenses across
product lines to determine profitability. In reviewing profitability, the
Independent Board Members recognized Nuveen's investment in its fund
business. The Independent Board Members further received the Form 8-K of
Nuveen for the quarter ending September 30, 2008. Based on its review, the
Independent Board Members concluded that Nuveen's level of profitability
for its advisory activities was reasonable in light of the services to be
provided.
In evaluating the reasonableness of the compensation, the Independent
Board Members also considered any other amounts expected to be paid to NAM
as well as any indirect benefits (such as soft dollar arrangements, if
any) NAM and its affiliates are expected to receive that are directly
attributable to their management of a Fund, if any. See Section E below
for additional information on indirect benefits NAM may receive as a
result of its relationship with the Funds. Based on their review of the
overall fee arrangements of each Fund, the Independent Board Members
determined that the advisory fees and expected expenses of the respective
Fund were reasonable.
D. ECONOMIES OF SCALE AND WHETHER FEE LEVELS REFLECT THESE ECONOMIES OF SCALE
With respect to economies of scale, the Independent Board Members recognized the
potential benefits resulting from the costs of a Fund being spread over a larger
asset base. The Independent Board Members therefore considered whether a Fund
could be expected to benefit from any economies of scale. In considering
economies of scale, the Independent Board Members have recognized that economies
of scale are difficult to measure and predict with precision. Notwithstanding
the foregoing, one method to help ensure that shareholders share in these
benefits is to include breakpoints in the advisory fee schedule. Accordingly,
the Independent Board Members received and reviewed the schedule of proposed
advisory fees for the Funds, including the respective fund-level breakpoints
thereto. In this regard, given that each Fund is a closed-end fund, the
Independent Board Members recognized that although a Fund may from time to time
make additional share offerings, the growth in its assets will occur primarily
through appreciation of its investment portfolio.
In addition to fund-level advisory fee breakpoints, the Board also considered
the Funds' complex-wide fee arrangement. Pursuant to the complex-wide fee
arrangement, the fees of the funds in the Nuveen complex, including the Funds,
are reduced as the assets in the fund complex reach certain levels. In
evaluating the complex-wide fee arrangement, the Independent Board Members have
considered that the complex-wide fee arrangement seeks to provide the benefits
of economies of scale to fund shareholders when total fund complex assets
increase, even if assets of a particular fund are unchanged or have decreased.
The approach reflects the notion that some of Nuveen's costs are attributable to
services provided to all its funds in the complex and therefore all funds
benefit if these costs are spread over a larger asset base. Based on their
review, the Independent Board Members concluded that the breakpoint schedule and
Nuveen Investments 27
Annual Investment Management Agreement Approval Process (continued)
complex-wide fee arrangement were acceptable and desirable in providing benefits
from economies of scale to shareholders of the Funds.
E. INDIRECT BENEFITS
In evaluating fees, the Independent Board Members also considered information
regarding potential "fall out" or ancillary benefits NAM or its affiliates may
receive as a result of its relationship with a Fund. In this regard, the
Independent Board Members considered the revenues received by affiliates of NAM
for serving as agent at Nuveen's preferred trading desk and for serving as a
co-manager in the initial public offering of new closed-end exchange traded
funds.
In addition to the above, the Independent Board Members considered whether NAM
will receive any benefits from soft dollar arrangements whereby a portion of the
commissions paid by a Fund for brokerage may be used to acquire research that
may be useful to NAM in managing the assets of the Fund and other clients. The
Independent Board Members noted that NAM does not currently have any soft dollar
arrangements; however, to the extent certain bona fide agency transactions that
occur on markets that traditionally trade on a principal basis and riskless
principal transactions are considered as generating "commissions," NAM intends
to comply with the applicable safe harbor provisions.
Based on their review, the Independent Board Members concluded that any indirect
benefits received by NAM as a result of its relationship with the Funds were
reasonable and within acceptable parameters.
F. APPROVAL
The Independent Board Members did not identify any single factor discussed
previously as all-important or controlling. The Board Members, including a
majority of the Independent Board Members, concluded that the terms of the
respective Investment Management Agreements were fair and reasonable, that NAM's
fees are reasonable in light of the services to be provided to the applicable
Fund and that the respective Investment Management Agreements should be and were
approved on behalf of the applicable Funds.
28 Nuveen Investments
Reinvest Automatically Easily and Conveniently
Nuveen makes reinvesting easy. A phone call is all it takes to set up your
reinvestment account.
NUVEEN CLOSED-END FUNDS DIVIDEND REINVESTMENT PLAN
Your Nuveen Closed-End Fund allows you to conveniently reinvest dividends and/or
capital gains distributions in additional Fund shares.
By choosing to reinvest, you'll be able to invest money regularly and
automatically, and watch your investment grow through the power of tax-free
compounding. Just like dividends or distributions in cash, there may be times
when income or capital gains taxes may be payable on dividends or distributions
that are reinvested.
It is important to note that an automatic reinvestment plan does not ensure a
profit, nor does it protect you against loss in a declining market.
EASY AND CONVENIENT
To make recordkeeping easy and convenient, each month you'll receive a statement
showing your total dividends and distributions, the date of investment, the
shares acquired and the price per share, and the total number of shares you own.
HOW SHARES ARE PURCHASED
The shares you acquire by reinvesting will either be purchased on the open
market or newly issued by the Fund. If the shares are trading at or above net
asset value at the time of valuation, the Fund will issue new shares at the
greater of the net asset value or 95% of the then-current market price. If the
shares are trading at less than net asset value, shares for your account will be
purchased on the open market. If the Plan Agent begins purchasing Fund shares on
the open market while shares are trading below net asset value, but the Fund's
shares subsequently trade at or above their net asset value before the Plan
Agent is able to complete its purchases, the Plan Agent may cease open-market
purchases and may invest the uninvested portion of the distribution in
newly-issued Fund shares at a price equal to the greater of the shares' net
asset value or 95% of the shares' market value on the last business day
immediately prior to the purchase date. Dividends and distributions received to
purchase shares in the open market will normally be invested shortly after the
dividend payment date. No interest will be paid on dividends and distributions
awaiting reinvestment. Because the market price of the shares may increase
before purchases are completed, the average purchase price
Nuveen Investments 29
Reinvest Automatically Easily and Conveniently (continued)
per share may exceed the market price at the time of valuation, resulting in the
acquisition of fewer shares than if the dividend or distribution had been paid
in shares issued by the Fund. A pro rata portion of any applicable brokerage
commissions on open market purchases will be paid by Plan participants. These
commissions usually will be lower than those charged on individual transactions.
FLEXIBLE
You may change your distribution option or withdraw from the Plan at any time,
should your needs or situation change. Should you withdraw, you can receive a
certificate for all whole shares credited to your reinvestment account and cash
payment for fractional shares, or cash payment for all reinvestment account
shares, less brokerage commissions and a $2.50 service fee.
You can reinvest whether your shares are registered in your name, or in the name
of a brokerage firm, bank, or other nominee. Ask your investment advisor if his
or her firm will participate on your behalf. Participants whose shares are
registered in the name of one firm may not be able to transfer the shares to
another firm and continue to participate in the Plan.
The Fund reserves the right to amend or terminate the Plan at any time. Although
the Fund reserves the right to amend the Plan to include a service charge
payable by the participants, there is no direct service charge to participants
in the Plan at this time.
CALL TODAY TO START REINVESTING DIVIDENDS AND/OR DISTRIBUTIONS
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in
or withdraw from the Plan, speak with your financial advisor or call us at (800)
257-8787.
30 Nuveen Investments
Glossary of Terms Used in this Report
o AVERAGE ANNUAL TOTAL RETURN: This is a commonly used method to express an
investment's performance over a particular, usually multi-year time
period. It expresses the return that would have been necessary each year
to equal the investment's actual cumulative performance (including change
in NAV or market price and reinvested dividends and capital gains
distributions, if any) over the time period being considered.
o MARKET YIELD (ALSO KNOWN AS DIVIDEND YIELD OR CURRENT YIELD): An
investment's current annualized dividend divided by its current market
price.
o NET ASSET VALUE (NAV): A Fund's NAV per share is calculated by subtracting
the liabilities of the Fund from its total assets and then dividing the
remainder by the number of shares outstanding. Fund NAVs are calculated at
the end of each business day.
Nuveen Investments 31
Notes
32 Nuveen Investments
Notes
Nuveen Investments 33
Notes
34 Nuveen Investments
Other Useful Information
BOARD OF TRUSTEES
John P. Amboian
Robert P. Bremner
Jack B. Evans
William C. Hunter
David J. Kundert
William J. Schneider
Judith M. Stockdale
Carole E. Stone
Terence J. Toth
FUND MANAGER
Nuveen Asset Management
333 West Wacker Drive
Chicago, IL 60606
CUSTODIAN
State Street Bank & Trust Company
Boston, MA
TRANSFER AGENT AND SHAREHOLDER SERVICES
State Street Bank & Trust Company
Nuveen Funds
P.O. Box 43071
Providence, RI 02940-3071
(800) 257-8787
LEGAL COUNSEL
Chapman and Cutler LLP
Chicago, IL
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
Ernst & Young LLP
Chicago, IL
NUVEEN FUNDS' QUARTERLY PORTFOLIO OF INVESTMENTS AND PROXY VOTING INFORMATION
You may obtain (i) each Fund's quarterly portfolio of investments, (ii)
information regarding how the Funds voted proxies relating to portfolio
securities held during the twelve-month period ended June 30, 2008, and (iii) a
description of the policies and procedures that the Funds used to determine how
to vote proxies relating to portfolio securities without charge, upon request,
by calling Nuveen Investments toll-free at (800) 257-8787 or on Nuveen's website
at www.nuveen.com.
You may also obtain this and other Fund information directly from the Securities
and Exchange Commission ("SEC"). The SEC may charge a copying fee for this
information. Visit the SEC on-line at http://www.sec.gov or in person at the
SEC's Public Reference Room in Washington, D.C. Call the SEC at (202) 942-8090
for room hours and operation. You may also request Fund information by sending
an e-mail request to publicinfo@sec.gov or by writing to the SEC's Public
References Section at 100 F Street NE, Washington, D.C. 20549.
CEO CERTIFICATION DISCLOSURE
Each Fund's Chief Executive Officer has submitted to the New York Stock Exchange
(NYSE) the annual CEO certification as required by Section 303A.12(a) of the
NYSE Listed Company Manual.
Each Fund has filed with the SEC the certification of its Chief Executive
Officer and Chief Financial Officer required by Section 302 of the
Sarbanes-Oxley Act.
SHARE INFORMATION
Each Fund intends to repurchase shares of its own common stock in the future at
such times and in such amounts as is deemed advisable. During the period covered
by this report, the Funds did not repurchase any of their common shares.
Any future repurchases will be reported to shareholders in the next annual or
semi-annual report.
Nuveen Investments 35
Nuveen Investments:
Serving Investors for Generations
Since 1898, financial advisors and their clients have relied on Nuveen
Investments to provide dependable investment solutions. For the past century,
Nuveen Investments has adhered to the belief that the best approach to investing
is to apply conservative risk-management principles to help minimize volatility.
Building on this tradition, we today offer a range of high quality equity and
fixed-income solutions that are integral to a well-diversified core portfolio.
Our clients have come to appreciate this diversity, as well as our continued
adherence to proven, long-term investing principles.
WE OFFER MANY DIFFERENT INVESTING SOLUTIONS FOR OUR CLIENTS' DIFFERENT NEEDS.
Nuveen Investments is a global investment management firm that seeks to help
secure the long-term goals of institutions and high net worth investors as well
as the consultants and financial advisors who serve them. Nuveen Investments
markets its growing range of specialized investment solutions under the
high-quality brands of HydePark, NWQ, Nuveen, Santa Barbara, Symphony,
Tradewinds and Winslow Capital. In total, the Company managed $115 billion of
assets on March 31, 2009.
FIND OUT HOW WE CAN HELP YOU REACH YOUR FINANCIAL GOALS.
To learn more about the products and services Nuveen Investments offers, talk to
your financial advisor, or call us at (800) 257-8787. Please read the
information provided carefully before you invest. Be sure to obtain a
prospectus, where applicable. Investors should consider the investment objective
and policies, risk considerations, charges and expenses of the Fund carefully
before investing. The prospectus contains this and other information relevant to
an investment in the Fund. For a prospectus, please contact your securities
representative or NUVEEN INVESTMENTS, 333 W. WACKER DR., CHICAGO, IL 60606.
Please read the prospectus carefully before you invest or send money.
Learn more about Nuveen Funds at: www.nuveen.com/cef
o Share prices
o Fund details
o Daily financial news
o Investor education
o Interactive planning tools
It's not what you earn,
it's what you keep.(R)
Distributed by
Nuveen Investments, LLC
333 West Wacker Drive
Chicago, IL 60606
www.nuveen.com
ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the registrant has adopted a
code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller, or
persons performing similar functions. There were no amendments to or waivers
from the Code during the period covered by this report. The registrant has
posted the code of ethics on its website at www.nuveen.com/CEF/Info/Shareholder.
(To view the code, click on Fund Governance and then click on Code of Conduct.)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's Board of Directors or Trustees ("Board") determined that the
registrant has at least one "audit committee financial expert" (as defined in
Item 3 of Form N-CSR) serving on its Audit Committee. The registrant's audit
committee financial expert is Jack B. Evans, who is "independent" for purposes
of Item 3 of Form N-CSR.
Mr. Evans was formerly President and Chief Operating Officer of SCI Financial
Group, Inc., a full service registered broker-dealer and registered investment
adviser ("SCI"). As part of his role as President and Chief Operating Officer,
Mr. Evans actively supervised the Chief Financial Officer (the "CFO") and
actively supervised the CFO's preparation of financial statements and other
filings with various regulatory authorities. In such capacity, Mr. Evans was
actively involved in the preparation of SCI's financial statements and the
resolution of issues raised in connection therewith. Mr. Evans has also served
on the audit committee of various reporting companies. At such companies, Mr.
Evans was involved in the oversight of audits, audit plans, and the preparation
of financial statements. Mr. Evans also formerly chaired the audit committee of
the Federal Reserve Bank of Chicago.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
The following tables show the amount of fees that Ernst & Young LLP, the Fund's
auditor, billed to the Fund during the Fund's last two full fiscal years. For
engagements with Ernst & Young LLP the Audit Committee approved in advance all
audit services and non-audit services that Ernst & Young LLP provided to the
Fund, except for those non-audit services that were subject to the pre-approval
exception under Rule 2-01 of Regulation S-X (the "pre-approval exception"). The
pre-approval exception for services provided directly to the Fund waives the
pre-approval requirement for services other than audit, review or attest
services if: (A) the aggregate amount of all such services provided constitutes
no more than 5% of the total amount of revenues paid by the Fund to its
accountant during the fiscal year in which the services are provided; (B) the
Fund did not recognize the services as non-audit services at the time of the
engagement; and (C) the services are promptly brought to the Audit Committee's
attention, and the Committee (or its delegate) approves the services before the
audit is completed.
The Audit Committee has delegated certain pre-approval responsibilities to its
Chairman (or, in his absence, any other member of the Audit Committee).
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE FUND
AUDIT FEES BILLED AUDIT-RELATED FEES TAX FEES ALL OTHER FEES
FISCAL YEAR ENDED TO FUND (1) BILLED TO FUND (2) BILLED TO FUND (3) BILLED TO FUND (4)
- ------------------------------------------------------------------------------------------------------------------------------------
April 30, 2009(5) $ 5,000 $ 0 $ 0 $ 0
- ------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
- ------------------------------------------------------------------------------------------------------------------------------------
April 30, 2008 N/A N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
- ------------------------------------------------------------------------------------------------------------------------------------
(1) "Audit Fees" are the aggregate fees billed for professional services for
the audit of the Fund's annual financial statements and services provided
in connection with statutory and regulatory filings or engagements.
(2) "Audit Related Fees" are the aggregate fees billed for assurance and
related services reasonably related to the performance of the audit or
review of financial statements and are not reported under "Audit Fees."
(3) "Tax Fees" are the aggregate fees billed for professional services for tax
advice, tax compliance, and tax planning.
(4) "All Other Fees" are the aggregate fees billed for products and services
other than "Audit Fees," "Audit Related Fees," and "Tax Fees."
(5) The Fund commenced operations April 28, 2009.
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE
ADVISER AND AFFILIATED FUND SERVICE PROVIDERS
The following tables show the amount of fees billed by Ernst & Young LLP to
Nuveen Asset Management ("NAM" or the "Adviser"), and any entity controlling,
controlled by or under common control with NAM that provides ongoing services to
the Fund ("Affiliated Fund Service Provider"), for engagements directly related
to the Fund's operations and financial reporting, during the Fund's last two
full fiscal years.
The tables also show the percentage of fees subject to the pre-approval
exception. The pre-approval exception for services provided to the Adviser and
any Affiliated Fund Service Provider (other than audit, review or attest
services) waives the pre-approval requirement if: (A) the aggregate amount of
all such services provided constitutes no more than 5% of the total amount of
revenues paid to Ernst & Young LLP by the Fund, the Adviser and Affiliated Fund
Service Providers during the fiscal year in which the services are provided that
would have to be pre-approved by the Audit Committee; (B) the Fund did not
recognize the services as non-audit services at the time of the engagement; and
(C) the services are promptly brought to the Audit Committee's attention, and
the Committee (or its delegate) approves the services before the Fund's audit is
completed.
FISCAL YEAR ENDED AUDIT-RELATED FEES TAX FEES BILLED TO ALL OTHER FEES
BILLED TO ADVISER AND ADVISER AND BILLED TO ADVISER
AFFILIATED FUND AFFILIATED FUND AND AFFILIATED FUND
SERVICE PROVIDERS SERVICE PROVIDERS SERVICE PROVIDERS
- ------------------------------------------------------------------------------------------------------------------------------------
April 30, 2009(1) $ 0 $ 0 $ 0
- ------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
- ------------------------------------------------------------------------------------------------------------------------------------
April 30, 2008 N/A N/A N/A
- ------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
- ------------------------------------------------------------------------------------------------------------------------------------
(1) The Fund commenced operations April 28, 2009.
NON-AUDIT SERVICES
The following table shows the amount of fees that Ernst & Young LLP billed
during the Fund's last two full fiscal years for non-audit services. The Audit
Committee is required to pre-approve non-audit services that Ernst & Young LLP
provides to the Adviser and any Affiliated Fund Services Provider, if the
engagement related directly to the Fund's operations and financial reporting
(except for those subject to the pre-approval exception described above). The
Audit Committee requested and received information from Ernst & Young LLP about
any non-audit services that Ernst & Young LLP rendered during the Fund's last
fiscal year to the Adviser and any Affiliated Fund Service Provider. The
Committee considered this information in evaluating Ernst & Young LLP's
independence.
FISCAL YEAR ENDED TOTAL NON-AUDIT FEES
BILLED TO ADVISER AND
AFFILIATED FUND SERVICE TOTAL NON-AUDIT FEES
PROVIDERS (ENGAGEMENTS BILLED TO ADVISER AND
RELATED DIRECTLY TO THE AFFILIATED FUND SERVICE
TOTAL NON-AUDIT FEES OPERATIONS AND FINANCIAL PROVIDERS (ALL OTHER
BILLED TO FUND REPORTING OF THE FUND) ENGAGEMENTS) TOTAL
- -------------------------------------------------------------------------------------------------------------------------------
April 30, 2009(1) $ 0 $ 0 $ 0 $ 0
April 30, 2008 N/A N/A N/A N/A
"Non-Audit Fees billed to Adviser" for both fiscal year ends represent "Tax
Fees" billed to Adviser in their respective amounts from the previous table.
(1) The Fund commenced operations April 28, 2009.
Audit Committee Pre-Approval Policies and Procedures. Generally, the Audit
Committee must approve (i) all non-audit services to be performed for the Fund
by the Fund's independent accountants and (ii) all audit and non-audit services
to be performed by the Fund's independent accountants for the Affiliated Fund
Service Providers with respect to operations and financial reporting of the
Fund. Regarding tax and research projects conducted by the independent
accountants for the Fund and Affiliated Fund Service Providers (with respect to
operations and financial reports of the Fund) such engagements will be (i)
pre-approved by the Audit Committee if they are expected to be for amounts
greater than $10,000; (ii) reported to the Audit Committee chairman for his
verbal approval prior to engagement if they are expected to be for amounts under
$10,000 but greater than $5,000; and (iii) reported to the Audit Committee at
the next Audit Committee meeting if they are expected to be for an amount under
$5,000.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The registrant's Board has a separately designated Audit Committee established
in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934,
as amended (15 U.S.C. 78c(a)(58)(A)). The members of the audit committee are
Robert P. Bremner, Jack B. Evans, Terence J. Toth, William J. Schneider and
David J. Kundert.
ITEM 6. SCHEDULE OF INVESTMENTS.
See Portfolio of Investments in Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
The registrant invests its assets primarily in municipal bonds and cash
management securities. On rare occasions the registrant may acquire, directly or
through a special purpose vehicle, equity securities of a municipal bond issuer
whose bonds the registrant already owns when such bonds have deteriorated or are
expected shortly to deteriorate significantly in credit quality. The purpose of
acquiring equity securities generally will be to acquire control of the
municipal bond issuer and to seek to prevent the credit deterioration or
facilitate the liquidation or other workout of the distressed issuer's credit
problem. In the course of exercising control of a distressed municipal issuer,
NAM may pursue the registrant's interests in a variety of ways, which may entail
negotiating and executing consents, agreements and other arrangements, and
otherwise influencing the management of the issuer. NAM does not consider such
activities proxy voting for purposes of Rule 206(4)-6 under the 1940 Act, but
nevertheless provides reports to the registrant's Board on its control
activities on a quarterly basis.
In the rare event that a municipal issuer were to issue a proxy or that the
registrant were to receive a proxy issued by a cash management security, NAM
would either engage an independent third party to determine how the proxy should
be voted or vote the proxy with the consent, or based on the instructions, of
the registrant's Board or its representative. A member of NAM's legal department
would oversee the administration of the voting, and ensure that records were
maintained in accordance with Rule 206(4)-6, reports were filed with the SEC on
Form N-PX, and the results provided to the registrant's Board and made available
to shareholders as required by applicable rules.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
THE PORTFOLIO MANAGER
The following individual has primary responsibility for the day-to-day
implementation of the registrant's investment strategies:
NAME FUND
Cathryn P. Steeves Nuveen New Jersey Municipal Value Fund
Other Accounts Managed. In addition to managing the registrant, the portfolio
manager is also primarily responsible for the day-to-day portfolio management of
the following accounts:
NUMBER OF
PORTFOLIO MANAGER TYPE OF ACCOUNT MANAGED ACCOUNTS ASSETS
- --------------------------------------------------------------------------------
Cathryn P. Steeves Registered Investment Company 44 $7.67 billion
Other Pooled Investment Vehicles 0 $0
Other Accounts 0 $0
* Assets are as of April 30, 2009. None of the assets in these accounts are
subject to an advisory fee based on performance.
Compensation. Each portfolio manager's compensation consists of three basic
elements--base salary, cash bonus and long-term incentive compensation. The
compensation strategy is to annually compare overall compensation to the market
in order to create a compensation structure that is competitive and consistent
with similar financial services companies. As discussed below, several factors
are considered in determining each portfolio manager's total compensation. In
any year these factors may include, among others, the effectiveness of the
investment strategies recommended by the portfolio manager's investment team,
the investment performance of the accounts managed by the portfolio manager, and
the overall performance of Nuveen Investments, Inc. (the parent company of NAM).
Although investment performance is a factor in determining the portfolio
manager's compensation, it is not necessarily a decisive factor. The portfolio
manager's performance is evaluated in part by comparing manager's performance
against a specified investment benchmark. This fund-specific benchmark is a
customized subset (limited to bonds in each Fund's specific state and with
certain maturity parameters) of the S&P/Investortools Municipal Bond index, an
index comprised of bonds held by managed municipal bond fund customers of
Standard & Poor's Securities Pricing, Inc. that are priced daily and whose fund
holdings aggregate at least $2 million. As of April 30, 2009, the
S&P/Investortools Municipal Bond index was comprised of 52,532 securities with
an aggregate current market value of $1,047 billion.
Base salary. Each portfolio manager is paid a base salary that is set at a level
determined by NAM in accordance with its overall compensation strategy discussed
above. NAM is not under any current contractual obligation to increase a
portfolio manager's base salary.
Cash bonus. Each portfolio manager is also eligible to receive an annual cash
bonus. The level of this bonus is based upon evaluations and determinations made
by each portfolio manager's supervisors, along with reviews submitted by his
peers. These reviews and evaluations often take into account a number of
factors, including the effectiveness of the investment strategies recommended to
the NAM's investment team, the performance of the accounts for which he serves
as portfolio manager relative to any benchmarks established for those accounts,
his effectiveness in communicating investment performance to stockholders and
their representatives, and his contribution to the NAM's investment process and
to the execution of investment strategies. The cash bonus component is also
impacted by the overall performance of Nuveen Investments, Inc. in achieving its
business objectives.
Long-term incentive compensation. In connection with the acquisition of Nuveen
Investments, Inc., by a group of investors led by Madison Dearborn Partners in
November 2007, certain employees, including portfolio managers, received profit
interests in Nuveen's parent. These profit interests entitle the holders to
participate in the appreciation in the value of Nuveen beyond the issue date and
vest over five to seven years, or earlier in the case of a liquidity event.
Material Conflicts of Interest. Each portfolio manager's simultaneous management
of the registrant and the other accounts noted above may present actual or
apparent conflicts of interest with respect to the allocation and aggregation of
securities orders placed on behalf of the registrant and the other account. NAM,
however, believes that such potential conflicts are mitigated by the fact that
the NAM has adopted several policies that address potential conflicts of
interest, including best execution and trade allocation policies that are
designed to ensure (1) that portfolio management is seeking the best price for
portfolio securities under the circumstances, (2) fair and equitable allocation
of investment opportunities among accounts over time and (3) compliance with
applicable regulatory requirements. All accounts are to be treated in a
non-preferential manner, such that allocations are not based upon account
performance, fee structure or preference of the portfolio manager, although the
allocation procedures may provide allocation preferences to funds with special
characteristics (such as favoring state funds versus national funds for
allocations of in-state bonds). In addition, NAM has adopted a Code of Conduct
that sets forth policies regarding conflicts of interest.
Beneficial Ownership of Securities. As of the April 30, 2009, the portfolio
manager beneficially owned the following dollar range of equity securities
issued by the registrant and other Nuveen Funds managed by NAM's municipal
investment team.
DOLLAR RANGE OF
EQUITY SECURITIES
DOLLAR RANGE BENEFICIALLY OWNED
OF EQUITY IN THE REMAINDER OF
SECURITIES NUVEEN FUNDS MANAGED
BENEFICIALLY BY NAM'S MUNICIPAL
NAME OF PORTFOLIO MANAGER FUND OWNED IN FUND INVESTMENT TEAM
- ------------------------------------------------------------------------------------------------------------------------------
Cathryn P. Steeves Nuveen New Jersey Municipal Value Fund $0 $10,000-$50,000
PORTFOLIO MANAGER BIO:
Cathryn P. Steeves, PhD, Vice President of NAM, is currently a portfolio manager
for 45 state-specific municipal bond funds. She joined Nuveen in 1996 and worked
as a senior analyst in the healthcare sector. Ms. Steeves has an undergraduate
degree from Wake Forest University as well as an MA, an MPhil and a PhD from
Columbia University.
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.
There have been no material changes to the procedures by which shareholders may
recommend nominees to the registrant's Board implemented after the registrant
last provided disclosure in response to this item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of this report that includes the disclosure
required by this paragraph, based on their evaluation of the controls
and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")
(17 CFR 240.13a-15(b) or 240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) that occurred during the second fiscal quarter
of the period covered by this report that has materially affected, or
is reasonably likely to materially affect, the registrant's internal
control over financial reporting.
ITEM 12. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit: Not applicable
because the code is posted on registrant's website at www.nuveen.com/CEF/Info/
Shareholder and there were no amendments during the period covered by this
report. (To view the code, click on Fund Governance and then Code of Conduct.)
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: Ex-99.CERT
Attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under
the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the
report by or on behalf of the registrant to 10 or more persons. Not applicable.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act,
provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR
270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR
240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished
pursuant to this paragraph will not be deemed "filed" for purposes of Section 18
of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of
that section. Such certification will not be deemed to be incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant specifically incorporates it by
reference. Ex-99.906 CERT attached hereto.
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.
(Registrant) Nuveen New Jersey Municipal Value Fund
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By (Signature and Title) /s/ Kevin J. McCarthy
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Kevin J. McCarthy
Vice President and Secretary
Date: July 8, 2009
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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 (Signature and Title) /s/ Gifford R. Zimmerman
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Gifford R. Zimmerman
Chief Administrative Officer
(principal executive officer)
Date: July 8, 2009
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By (Signature and Title) /s/ Stephen D. Foy
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Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date: July 8, 2009
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