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: 811-5340
Name of Registrant: Vanguard New Jersey Tax-Free Funds
Address of Registrant: P.O. Box 2600
Valley Forge, PA 19482
Name and address of agent for service: R. Gregory Barton, Esquire
P.O. Box 876
Valley Forge, PA 19482
Registrant's telephone number, including area code: (610) 669-1000
Date of fiscal year end: November 30
Date of reporting period: December 1, 2002 - May 31, 2003
Item 1: Reports to Shareholders
VANGUARD(R) NEW JERSEY TAX-EXEMPT FUNDS
SEMIANNUAL REPORT
MAY 31, 2003
VANGUARD(R) NEW JERSEY TAX-EXEMPT MONEY MARKET FUND
VANGUARD(R) NEW JERSEY LONG-TERM TAX-EXEMPT FUND
ETERNAL PRINCIPLES
Markets change, but the principles of successful investing do not. During the
past few years, radical upheaval in the stock market has displayed the power of
this simple truth to dramatic effect.
In the late 1990s, stocks experienced one of the greatest bull markets in
financial history. Then, in March 2000, the longest downturn since the Great
Depression began.
In both bull and bear markets, however, the principles of successful
investing are identical: balance, diversification, and attention to costs.
Balance among stock, bond, and money market funds allows you to pursue long-term
growth while moderating your risk. Diversification limits your exposure to the
disasters that can befall any one security or sector. Attention to costs means
you keep a larger share of any rewards produced by your investments.
These principles are timeless. In fact, they're the basis of our very first
mutual fund--Vanguard(R) Wellington(TM) Fund, a balanced portfolio established
in 1929. Over time, balance, diversification, and attention to costs have proven
to be the master keys to investment success.
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SUMMARY
* Vanguard New Jersey Tax-Exempt Money Market Fund and Vanguard New Jersey
Long-Term Tax-Exempt Fund posted six-month returns of 0.5% and 7.3%,
respectively, outperforming their average peers.
* Interest rates continued to decline from already low levels.
* The investing skills of the funds' adviser and the funds' low costs
explained the strong relative returns.
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CONTENTS
1 Letter from the Chairman
5 Report from the Adviser
8 Fund Profiles
10 Glossary of Investment Terms
11 Performance Summaries
13 Financial Statements
34 Advantages of Vanguard.com
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LETTER FROM THE CHAIRMAN PICTURE OF
JOHN J. BRENNAN
Dear Shareholder,
During the first half of the Vanguard New Jersey Tax-Exempt Funds' fiscal year,
interest rates declined to levels not seen in decades, boosting the prices of
bonds, particularly those with the longest maturities. The funds outperformed
their average peer funds during the six months ended May 31, 2003, with both
share classes of the Long-Term Tax-Exempt Fund returning 7.3% and the Tax-Exempt
Money Market Fund returning 0.5%.
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TOTAL RETURNS SIX MONTHS ENDED
MAY 31, 2003
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Vanguard New Jersey Tax-Exempt Money Market Fund 0.5%
(SEC 7-Day Annualized Yield: 1.03%)
Average New Jersey Tax-Exempt Money Market Fund* 0.3
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Vanguard New Jersey Long-Term Tax-Exempt Fund
Investor Shares 7.3%
Admiral Shares 7.3
Average New Jersey Municipal Debt Fund* 6.0
Lehman 10 Year Municipal Bond Index 7.2
Lehman Municipal Bond Index 6.5
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*Derived from data provided by Lipper Inc.
During the period, the yield of the Long-Term Tax-Exempt Fund's Investor
Shares slid 76 basis points (0.76 percentage point) to 3.02%. (The yield of the
fund's Admiral Shares at the end of the period was 3.07%.) For a New Jersey
resident in the highest federal tax bracket, that amounted to a taxable
equivalent yield (accounting for state and federal taxes, but not for local tax
or the possibility that an individual might be subject to the alternative
minimum tax) of 4.96% (5.04% for Admiral Shares). The yield of the Money Market
Fund actually rose 1 basis point to 1.03%, a taxable equivalent yield of 1.69%.
The returns of the Vanguard New Jersey Tax-Exempt Funds and of their
comparative standards appear in the table above; the components of the funds'
returns are presented in the table on page 4.
INTEREST RATES CONTINUED THEIR DOWNWARD MARCH
During the past six months, both taxable and tax-exempt bonds outpaced the 5.1%
return of the Wilshire 5000 Total Market Index, a proxy for the broad U.S. stock
market. The Lehman Brothers Aggregate Bond Index, a proxy for the broad taxable
investment-grade bond market, returned 6.3%, and the Lehman Municipal Bond Index
returned 6.5%.
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Admiral(TM) Shares A lower-cost class of shares available to many longtime
shareholders and to those with significant investments in the fund.
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1
At the short-term end of the fixed income maturity range, the yield of a
high-quality 1-year municipal note fell 35 basis points to 0.98%. Longer-term
interest rates fell more dramatically, with the yield of the 10-year municipal
note declining 77 basis points to 3.10%. In an unusual turn of events, the
yields of the shortest-term municipal securities finished the period almost as
high as or higher than those of their fully taxable counterparts. On May 31, for
example, the New Jersey Tax-Exempt Money Market Fund yielded more than
Vanguard(R) Prime Money Market Fund, before taking the tax-exempt fund's
significant tax advantages into account.
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MARKET BAROMETER TOTAL RETURNS
PERIODS ENDED MAY 31, 2003
-------------------------------------
SIX ONE FIVE
MONTHS YEAR YEARS*
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BONDS
Lehman Aggregate Bond Index 6.3% 11.6% 7.8%
(Broad taxablemarket)
Lehman Municipal Bond Index 6.5 10.4 6.5
Citigroup 3-Month Treasury Bill Index 0.6 1.5 4.0
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STOCKS
Russell 1000 Index (Large-caps) 4.6% -7.7% -0.8%
Russell 2000 Index (Small-caps) 9.3 -8.2 0.6
Wilshire 5000 Index (Entire market) 5.1 -7.2 -0.9
MSCI All Country World Index Free
ex USA (International) 4.6 -10.8 -3.4
================================================================================
CPI
Consumer Price Index 1.2% 2.1% 2.4%
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*Annualized.
STOCKS RALLIED AFTER A WEAK START
U.S. stocks initially drifted lower during the six-month period, but began a
rally at the start of the Iraqi war in mid-March. The overall U.S. stock market,
as measured by the Wilshire 5000 Index, sustained a loss of -9.5% during the
first three months of the period, followed by a return of 16.1% in the latter
half, for a six-month return of 5.1%.
TIMES GOT TOUGH, BUT RETURNS WERE STRONG
Sluggishness in the broad U.S. economy has reverberated through state and local
budgets, reducing--or, at least, arresting the growth of--tax revenues that had
burnished governments' financial statements during the economic boom of the late
1990s. Despite a reversal of fortune in New Jersey's fiscal condition, the
state's municipal bonds turned in strong returns during the past six months as
investors demonstrated enthusiasm for New Jersey debt. The New Jersey Long-Term
Tax-Exempt Fund produced a capital return of 4.9%, as investors bid up the bonds
in its portfolio. Including income distributions, the fund's total returns were
a very strong 7.3%.
The flip side of rising bond prices is, of course, falling yields, and, as
noted earlier, the yield of the Long-Term Tax-Exempt Fund's Investor Shares fell
to 3.02%. Although the yield on New Jersey money market instruments was
2
more or less unchanged, already low yields meant modest returns for the New
Jersey Tax-Exempt Money Market Fund. For the half-year, the fund returned just
0.5%.
Both of our funds outpaced their average peers. This outperformance
reflects not only the skillful credit analysis and portfolio management of our
adviser, Vanguard Fixed Income Group, but also our funds' low costs. While the
average New Jersey tax-exempt municipal fund charged an expense ratio of 1.04%,
our Long-Term Tax-Exempt Fund's Investor Shares carried an annualized expense
ratio of 0.17% (0.11% for Admiral Shares). That 87-basis-point difference is an
enormous advantage with current bond yields being so low. Our cost advantage is
also impressive on the money market side. Our fund's expense ratio: 0.16%. The
average competitor's: 0.69%.
A SIMPLE STRATEGY FOR LONG-TERM SUCCESS
Industrywide, taxable and tax-exempt bonds have attracted strong interest as
investors have sought refuge from an unsettled stock market and economy.
We are concerned that some investors may be buying bonds not as a component
of a diversified portfolio, but simply because bonds have "done best" lately--a
recipe for disappointment. We advise establishing an asset allocation among
stock, bond, and money market funds that is consistent with your circumstances
and goals and then sitting tight. This approach is the most effective means of
reaching any long-term financial goal.
Thank you for entrusting your assets to us.
Sincerely,
/S/ JOHN J. BRENNAN
John J. Brennan
Chairman and Chief Executive Officer
JUNE 18, 2003
3
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YOUR FUND'S PERFORMANCE AT A GLANCE NOVEMBER 30, 2002-MAY 31, 2003
DISTRIBUTIONS PER SHARE
------------------------
STARTING ENDING INCOME CAPITAL
SHARE PRICE SHARE PRICE DIVIDENDS GAINS
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New Jersey Tax-Exempt Money
Market Fund $1.00 $1.00 $0.005 $0.000
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New Jersey Long-Term Tax-Exempt Fund
Investor Shares $12.06 $12.60 $0.279 $0.047
Admiral Shares 12.06 12.60 0.282 0.047
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IAN MACKINNON TO RETIRE
Vanguard Managing Director Ian A. MacKinnon, who has served this company and its
shareholders for more than two decades as head of our Fixed Income Group, will
retire on June 30. It's impossible to adequately summarize Ian's many
accomplishments, but I must express my deep gratitude to him for establishing
our fixed income practices and philosophy, and serving our shareholders with
great skill, integrity, and commitment since he formed our Fixed Income Group in
1981. He will leave behind an outstanding performance record in our money market
and bond funds, a tradition of excellence, and a terrific team of investment
professionals. We wish him the very best.
Robert F. Auwaerter, who also has more than 20 years' experience managing
Vanguard's fixed income funds, will oversee all of the group's portfolio
management activities.
George U. Sauter, managing director of our Quantitative Equity Group, will
assume overall responsibility for the Fixed Income Group in the newly created
position of chief investment officer. --John J. Brennan
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4
REPORT FROM THE ADVISER
During the six months ended May 31, 2003, the Vanguard New Jersey Tax-Exempt
Funds earned total returns that topped those of their average mutual fund peers,
with the Long-Term Tax-Exempt Fund returning 7.3% and the Tax-Exempt Money
Market Fund returning 0.5%. However, the yield of the Long-Term Fund was lower
than it was six months ago, reflecting a decline in interest rates. The yield of
the Money Market Fund inched up 1 basis point (0.01 percentage point).
THE INVESTMENT ENVIRONMENT
The economy appears to be muddling along. The nation's inflation-adjusted gross
domestic product is growing, but hardly by leaps and bounds. First-quarter GDP
expanded at an annual rate of 1.4%, unchanged from the final three months of
2002.
Other economic data have been mixed. Consumer confidence fell dramatically
during the prelude to the war in Iraq, but bounced back shortly after the major
hostilities ended. However, the postwar "relief rally" in sentiment has been
anemic, at best. Manufacturers continue to struggle, and business investment has
shown few signs of improvement.
Economic weakness has persisted despite a level of interest rates not seen
since the 1950s. After an extended string of rate cuts in 2001 and one cut in
2002, the target federal funds rate remained unchanged during the period at
1.25%. (The Federal Reserve Board shaved 25 basis points from the rate on June
25.) The Fed seems to be taking a "do whatever it takes" attitude to preserve a
recovery. Inflation is no longer a concern--the "core" rate of inflation in
consumer prices (which excludes food and energy costs) was just 1.6% for the 12
months ended May 31. Although unlikely, deflation has recently emerged as a
threat.
Overall, it appears as though consumers are still carrying the economy on
their backs. They are, however, showing signs of tiring. Unemployment rose to
6.1% in May, sending a chill through the labor market.
The economy's bright spot is still the housing market. Price increases seem
to be holding, and financing remains at extremely attractive levels, thanks to
low interest rates.
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INVESTMENT PHILOSOPHY
The adviser believes that each fund, while operating within stated maturity and
stringent quality targets, can achieve a high level of current income that is
exempt from federal and New Jersey income taxes by investing in high-quality
securities issued by New Jersey state, county, and municipal governments.
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STATE GOVERNMENTS CAME UNDER FISCAL PRESSURE
Short-term municipal securities underperformed their U.S. Treasury counterparts
during the recent bond market rally, while longer-term municipal
5
bonds performed comparably to longer-term Treasuries.
The adjacent table provides details on the decline in muni yields.
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MUNICIPAL BOND YIELDS (AAA-RATED GENERAL-OBLIGATION ISSUES)
CHANGE
MATURITY MAY 31, 2003 NOV. 30, 2002 (BASIS POINTS)
- --------------------------------------------------------------------------------
2 years 1.13% 1.70% -57
5 years 2.08 2.75 -67
10 years 3.10 3.87 -77
30 years 4.34 5.01 -67
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Source: The Vanguard Group.
Across the country, state tax revenues continued to fall in the fiscal
half-year, and the declines created large gaps in state and local government
budgets. Cuts in government services and staffs have been ongoing, but these
moves haven't helped balance many budgets. It still remains politically
difficult to raise taxes, although many municipalities are considering this
option out of desperation.
Most states are also looking at options for one-time revenue enhancement,
such as securitizing tobacco-settlement payments, or are focusing on multiple
smaller usage-based tax increases. The issuance of tobacco-settlement debt has
recently swept the tax-exempt market. Lately, these issues have run into trouble
as investors fear large awards in individual and class-action suits against the
tobacco companies. Because of this, it now appears that states will be forced to
focus on other means to raise funds until the market obtains a clear view of the
durability of tobacco-settlement payments. (The Vanguard New Jersey Tax-Exempt
Funds did not own any tobacco-related debt on May 31.)
Compared with the performance of municipal bonds nationally, New Jersey
debt underperformed slightly, primarily because of a large increase in new
issues. New Jersey issued $7.6 billion in new municipal debt during the past six
months, a 24% increase from the same period a year ago. Heavy supply is expected
to continue as the New Jersey Turnpike Authority issues $1.4 billion bonds for a
deal that will merge its management with that of the Garden State Parkway. Like
most other states, New Jersey also faces budget pressure because of the slowdown
in economic growth.
MUNIS OFFER GOOD VALUE FOR MANY INVESTORS
During the six months, municipal bonds offered good value. The yield of a
2-year, tax-exempt municipal note on May 31 was 1.13%, just a bit lower than the
1.33% yield of a comparable Treasury security, whose income is subject to
federal tax. For longer maturities, 5-year notes offered 91% of the yield of
Treasuries; 10-year notes, 92%; and 30-year bonds, 99%.
Of course, such value is not always available in the municipal bond market.
But for many investors, well-managed, low-cost portfolios of municipal bonds can
be an integral part of a diversified investment program. With yields
6
at such low levels--money market yields were hovering around 1% on May 31--low
costs are especially valuable.
Ian A. MacKinnon, Managing Director
Christopher M. Ryon, Principal
Pamela Wisehaupt Tynan, Principal
Daniel S. Solender, Principal
Kathryn Allen, Principal
VanguardFixed Income Group
June 26, 2003
7
Fund Profiles As of May 31, 2003
These Profiles provide snapshots of each fund's characteristics, compared where
indicated with both an appropriate market index and a broad market index. Key
terms are defined on page 10.
NEW JERSEY TAX-EXEMPT MONEY MARKET FUND
- ----------------------------------------
Financial Attributes
Yield 1.0%
Average Maturity 28 days
Average Quality MIG-1
Expense Ratio 0.16%*
- ----------------------------------------
- -----------------------------------------------
DISTRIBUTION BY CREDIT QUALITY (% OF PORTFOLIO)
MIG-1/SP-1+ 72.0%
A-1/P-1 27.5
AAA/AA 0.5
- -----------------------------------------------
Total 100.0%
- -----------------------------------------------
*Annualized.
8
FUND PROFILES (CONTINUED)
NEW JERSEY LONG-TERM TAX-EXEMPT FUND
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FINANCIAL ATTRIBUTES
COMPARATIVE BROAD
FUND INDEX* INDEX**
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Number of Issues 348 8,755 46,532
Yield 3.1% 3.2%
Investor Shares 3.0%
Admiral Shares 3.1%
Yield to Maturity 3.1% -- --
Average Coupon 4.7% 5.2% 5.2%
Average Maturity 7.3 years 9.8 years 13.8 years
Average Quality AAA AA+ AA+
Average Duration 5.8 years 6.6 years 7.8 years
Expense Ratio -- --
Investor Shares 0.17%+
Admiral Shares 0.11%+
Cash Investments 0.1% -- --
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- -----------------------------------------------
DISTRIBUTION BY CREDIT QUALITY (% OF PORTFOLIO)
AAA 90.1%
AA 5.2
A 3.5
BBB 1.2
- -----------------------------------------------
Total 100.0%
- -----------------------------------------------
- ----------------------------
INVESTMENT FOCUS
Credit Quality High
Average Maturity Long
- ----------------------------
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VOLATILITY MEASURES
COMPARATIVE BROAD
FUND INDEX* FUND INDEX**
- ----------------------------------------------------------------------
R-Squared 0.97 1.00 0.98 1.00
Beta 0.98 1.00 1.09 1.00
- ----------------------------------------------------------------------
- ------------------------------------------
DISTRIBUTION BY MATURITY (% OF PORTFOLIO)
Under 1 Year 8.8%
1-5 Years 19.8
5-10 Years 53.8
10-20 Years 16.7
20-30 Years 0.9
- ------------------------------------------
Total 100.0%
- ------------------------------------------
*Lehman 10 Year Municipal Bond Index.
**Lehman Municipal Bond Index.
+Annualized.
VISIT OUR WEBSITE AT
WWW.VANGUARD.COM
FOR REGULARLY UPDATED FUND INFORMATION.
9
GLOSSARY OF INVESTMENT TERMS
AVERAGE COUPON. The average interest rate paid on the securities held by a fund.
It is expressed as a percentage of face value.
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AVERAGE DURATION. An estimate of how much a bond fund's share price will
fluctuate in response to a change in interest rates. To see how the price could
shift, multiply the fund's duration by the change in rates. If interest rates
rise by one percentage point, the share price of a fund with an average duration
of five years would decline by about 5%. If rates decrease by a percentage
point, the fund's share price would rise by 5%.
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AVERAGE MATURITY. The average length of time until securities held by a fund
reach maturity (or are called) and are repaid. In general, the longer the
average maturity, the more a fund's share price will fluctuate in response to
changes in market interest rates.
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AVERAGE QUALITY. An indicator of credit risk, this figure is the average of the
ratings assigned to a fund's holdings by credit-rating agencies. The agencies
make their judgment after appraising an issuer's ability to meet its
obligations. Quality is graded on a scale, with Aaa or AAA indicating the most
creditworthy bond issuers and A-1 or MIG-1 indicating the most creditworthy
issuers of money market securities.
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BETA. A measure of the magnitude of a fund's past share-price fluctuations in
relation to the ups and downs of a comparative index and an overall market
index. Each index is assigned a beta of 1.00. Compared with a given index, a
fund with a beta of 1.20 typically would have seen its share price rise or fall
by 12% when the index rose or fell by 10%. However, a fund's beta should be
reviewed in conjunction with its R-squared (see definition below). The lower the
R-squared, the less correlation there is between the fund and the benchmark, and
the less reliable beta is as an indicator of volatility.
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CASH INVESTMENTS. The percentage of a fund's net assets invested in "cash
equivalents"--highly liquid, short-term, interest-bearing securities. This
figure does not include cash invested in futures contracts to simulate bond
investment.
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EXPENSE RATIO. The percentage of a fund's average net assets used to pay its
annual administrative and advisory expenses. These expenses directly reduce
returns to investors.
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R-SQUARED. A measure of how much of a fund's past returns can be explained by
the returns from the market in general, as measured by a comparative index or an
overall market index. If a fund's total returns were precisely synchronized with
an index's returns, its R-squared would be 1.00. If the fund's returns bore no
relationship to the index's returns, its R-squared would be 0.
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YIELD. A snapshot of a fund's interest income. The yield, expressed as a
percentage of the fund's net asset value, is based on income earned over the
past 30 days (7 days for money market funds) and is annualized, or projected
forward for the coming year.
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YIELD TO MATURITY. The rate of return an investor would receive if the
securities held by a fund were held to their maturity dates. (degree)
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10
PERFORMANCE SUMMARIES AS OF MAY 31, 2003
All of the returns in this report represent past performance, which cannot be
used to predict future returns that may be achieved by the funds. An investment
in a money market fund is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. Although the New Jersey
Tax-Exempt Money Market Fund seeks to preserve the value of your investment at
$1 per share, it is possible to lose money by investing in the fund. For bond
funds, both share price and return can fluctuate widely. An investor's shares,
when redeemed, could be worth more or less than their original cost. The returns
shown do not reflect taxes that a shareholder would pay on fund distributions or
on the redemption of fund shares. The annualized yield shown for the money
market fund reflects the current earnings of the fund more closely than does the
total return.
NEW JERSEY TAX-EXEMPT MONEY MARKET FUND
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FISCAL-YEAR TOTAL RETURNS (%) NOVEMBER 30, 1992-MAY 31, 2003
- --------------------------------------------------------------------------------
NEW JERSEY TAX-EXEMPT AVERAGE
MONEY MARKET FUND FUND*
FISCAL TOTAL TOTAL
YEAR RETURN RETURN
- --------------------------------------------------------------------------------
1993 2.3% 2.0%
1994 2.5 2.2
1995 3.6 3.3
1996 3.2 2.9
1997 3.3 3.0
1998 3.2 2.8
- --------------------------------------------------------------------------------
NEW JERSEY TAX-EXEMPT AVERAGE
MONEY MARKET FUND FUND*
FISCAL TOTAL TOTAL
YEAR RETURN RETURN
- --------------------------------------------------------------------------------
1999 2.9% 2.5%
2000 3.7 3.4
2001 2.8 2.4
2002 1.3 0.9
2003** 0.5 0.3
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SEC 7-Day Annualized Yield (5/31/2003): 1.03%
* Average New Jersey Tax-Exempt Money Market Fund; derived from data provided by
Lipper Inc.
**Six months ended May 31, 2003.
NOTE: See Financial Highlights table on page 29 for dividend information.
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AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED MARCH 31, 2003
This table presents average annual total returns through the latest calendar
quarter--rather than through the end of the fiscal period. Securities and
Exchange Commission rules require that we provide this information.
TEN YEARS
ONE FIVE ------------------------
INCEPTION DATE YEAR YEARS CAPITAL INCOME TOTAL
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New Jersey Tax-Exempt
Money Market Fund 2/3/1988 1.16% 2.61% 0.00% 2.83% 2.83%
- --------------------------------------------------------------------------------
11
NEW JERSEY LONG-TERM TAX-EXEMPT FUND
- --------------------------------------------------------------------------------
FISCAL-YEAR TOTAL RETURNS (%) NOVEMBER 30, 1992-MAY 31, 2003
- --------------------------------------------------------------------------------
NEW JERSEY LONG-TERM
TAX-EXEMPT FUND INVESTOR SHARES LEHMAN*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- --------------------------------------------------------------------------------
1993 6.6% 5.9% 12.5% 11.7%
1994 -11.2 5.1 -6.1 -4.5
1995 13.3 6.4 19.7 18.6
1996 -0.7 5.4 4.7 5.7
1997 1.0 5.4 6.4 7.1
1998 2.3 5.3 7.6 8.1
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
NEW JERSEY LONG-TERM
TAX-EXEMPT FUND INVESTOR SHARES LEHMAN*
FISCAL CAPITAL INCOME TOTAL TOTAL
YEAR RETURN RETURN RETURN RETURN
- --------------------------------------------------------------------------------
1999 -6.2% 4.9% -1.3% -0.4%
2000 2.9 5.7 8.6 7.7
2001 3.4 5.2 8.6 8.2
2002 1.5 4.9 6.4 6.7
2003** 4.9 2.4 7.3 7.2
- --------------------------------------------------------------------------------
*Lehman 10 Year Municipal Bond Index.
**Six months ended May 31, 2003.
Note: See Financial Highlights tables on page 30 for dividend and capital gains
information.
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AVERAGE ANNUAL TOTAL RETURNS FOR PERIODS ENDED MARCH 31, 2003
This table presents average annual total returns through the latest calendar
quarter--rather than through the end of the fiscal period. Securities and
Exchange Commission rules require that we provide this information.
TEN YEARS
ONE FIVE -----------------------
INCEPTION DATE YEAR YEARS CAPITAL INCOME TOTAL
- --------------------------------------------------------------------------------
New Jersey Long-Term
Tax-Exempt Fund
Investor Shares 2/3/1988 9.93% 6.17% 0.92% 5.36% 6.28%
Admiral Shares 5/14/2001 9.99 7.65* -- -- --
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*Return since inception.
12
FINANCIAL STATEMENTS MAY 31, 2003 (UNAUDITED)
STATEMENT OF NET ASSETS
This Statement provides a detailed list of each fund's municipal bond holdings,
including each security's market value on the last day of the reporting period
and information on credit enhancements (insurance or letters of credit). Other
assets are added to, and liabilities are subtracted from, the value of Total
Municipal Bonds to calculate the fund's Net Assets. Finally, Net Assets are
divided by the outstanding shares of the fund to arrive at its share price, or
Net Asset Value (NAV) Per Share.
At the end of the Statement of Net Assets, you will find a table displaying
the composition of the fund's net assets. Undistributed Net Investment Income is
usually zero because the fund distributes its net income to shareholders as a
dividend each day. Any realized gains must be distributed annually, so the bulk
of net assets consists of Paid-in Capital (money invested by shareholders). The
balance shown for Accumulated Net Realized Gains usually approximates the amount
available to distribute to shareholders as taxable capital gains as of the
statement date, but may differ because certain investments or transactions may
be treated differently for financial statement and tax purposes. Any Accumulated
Net Realized Losses, and any cumulative excess of distributions over net
realized gains, will appear as negative balances. Unrealized Appreciation
(Depreciation) is the difference between the value of the fund's investments and
their cost, and reflects the gains (losses) that would be realized if the fund
were to sell all of its investments at their statement-date values.
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FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (99.4%)
- --------------------------------------------------------------------------------------------------------------------------
Bridgewater Township NJ BAN 2.25% 10/10/2003 $ 20,800 $ 20,864
Burlington County NJ BAN 1.55% 7/17/2003 4,500 4,500
Burlington County NJ BAN 2.25% 9/11/2003 9,745 9,768
Cherry Hill Township NJ BAN 2.25% 10/9/2003 18,723 18,774
Essex County NJ Improvement Auth. Rev.
(Pooled Govt. Loan) VRDO 1.05% 6/9/2003 LOC 36,950 36,950
Fort Lee NJ BAN 1.75% 3/26/2004 6,378 6,412
Freehold NJ Regional High School Dist. TOB VRDO 1.18% 6/9/2003 (3)* 9,690 9,690
Gloucester County NJ PCR (Mobil Oil Refining Corp.)
VRDO 0.80% 6/9/2003 28,110 28,110
Hopewell Township NJ BAN 2.00% 1/29/2004 7,506 7,547
Lawrence Township NJ BAN 2.00% 12/19/2003 4,700 4,721
Mahwah Township NJ BAN 2.25% 6/19/2003 4,050 4,051
Middlesex County NJ BAN 2.25% 6/26/2003 43,807 43,829
Middlesex County NJ BAN 2.00% 1/13/2004 16,500 16,585
Monmouth County NJ Improvement Auth. Rev.
(Pooled Govt. Loan) VRDO 1.00% 6/9/2003 LOC 65,665 65,665
Moorestown Township NJ BAN 1.75% 5/27/2004 5,970 6,014
Morris County NJ BAN 2.25% 6/26/2003 13,510 13,516
New Jersey Building Auth. Rev. TOB VRDO 1.22% 6/9/2003 (1)* 42,040 42,040
New Jersey Econ. Dev. Auth. Market
Transition Fac. Rev. TOB VRDO 1.19% 6/9/2003 (1)* 6,215 6,215
New Jersey Econ. Dev. Auth. Natural Gas Fac. Rev.
(New Jersey Natural Gas) VRDO 1.35% 6/2/2003 (2) 34,500 34,500
New Jersey Econ. Dev. Auth. Rev.
(Bennedictine Abbey Newark) VRDO 1.05% 6/9/2003 LOC 19,000 19,000
New Jersey Econ. Dev. Auth. Rev.
(Bennedictine Abbey Newark) VRDO 1.05% 6/9/2003 LOC 8,925 8,925
13
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
New Jersey Econ. Dev. Auth. Rev.
(Chambers Cogeneration Limited Partnership) CP 1.02% 6/10/2003 LOC $ 22,500 $ 22,500
New Jersey Econ. Dev. Auth. Rev.
(Chambers Cogeneration Limited Partnership) CP 1.05% 7/9/2003 LOC 29,100 29,100
New Jersey Econ. Dev. Auth. Rev.
(Columbia Univ. Project) VRDO 1.15% 6/9/2003 8,585 8,585
New Jersey Econ. Dev. Auth. Rev.
(Hoffman-La Roche) VRDO 1.25% 6/2/2003 LOC 17,500 17,500
New Jersey Econ. Dev. Auth. Rev.
(Jewish Community Center) VRDO 1.10% 6/9/2003 LOC 6,000 6,000
New Jersey Econ. Dev. Auth. Rev.
(Lawrenceville School Project) VRDO 1.20% 6/2/2003 10,600 10,600
New Jersey Econ. Dev. Auth. Rev.
(Lawrenceville School Project) VRDO 1.20% 6/2/2003 12,900 12,900
New Jersey Econ. Dev. Auth. Rev. (Logan Project) CP 1.02% 6/11/2003 LOC 36,900 36,900
New Jersey Econ. Dev. Auth. Rev. (Logan Project) CP 1.05% 7/9/2003 4,000 4,000
New Jersey Econ. Dev. Auth. Rev.
(Peddie School Project) VRDO 1.20% 6/9/2003 8,100 8,100
New Jersey Econ. Dev. Auth. Rev. (Russell Berrie) VRDO 1.12% 6/9/2003 LOC 7,000 7,000
New Jersey Econ. Dev. Auth. Rev.
(Transp. Project) TOB VRDO 1.18% 6/9/2003 (4)* 7,465 7,465
New Jersey Econ. Dev. Auth. Rev.
(United States Golf Association) VRDO 1.20% 6/9/2003 LOC 5,700 5,700
New Jersey Econ. Dev. Auth. Rev. PCR (Exxon) VRDO 0.90% 6/2/2003 3,200 3,200
New Jersey Econ. Dev. Auth. Water Fac. Rev.
(New Jersey Water Co. Project) TOB VRDO 1.21% 6/9/2003 (3)* 4,850 4,850
New Jersey Econ. Dev. Auth. Water Fac. Rev.
(United Water Co.) VRDO 1.30% 6/2/2003 (2) 37,750 37,750
New Jersey Econ. Dev. Auth. Water Fac. Rev.
(United Water Co.) VRDO 1.30% 6/2/2003 (2) 12,000 12,000
New Jersey Educ. Fac. Auth. Rev.
(College of New Jersey) VRDO 1.20% 6/9/2003 (2) 32,100 32,100
New Jersey Educ. Fac. Auth. Rev.
(Institute for Defense Analyses) VRDO 1.14% 6/9/2003 (2) 13,695 13,695
New Jersey Educ. Fac. Auth. Rev. (Princeton Univ.) VRDO 1.25% 6/2/2003 63,380 63,380
New Jersey Educ. Fac. Auth. Rev. (Princeton Univ.) VRDO 1.25% 6/2/2003 37,450 37,450
New Jersey GO TOB VRDO 1.19% 6/9/2003 * 24,200 24,200
New Jersey GO TOB VRDO 1.19% 6/9/2003 (Prere.)* 16,385 16,385
New Jersey GO TOB VRDO 1.19% 6/9/2003 (3)* 30,795 30,795
New Jersey Health Care Fac. Financing Auth. Rev.
(Holy Name Hosp.) VRDO 1.15% 6/9/2003 LOC 7,300 7,300
New Jersey Health Care Fac. Financing Auth. Rev.
(Hosp. Capital Asset Pooled Program) VRDO 1.10% 6/9/2003 LOC 15,400 15,400
New Jersey Health Care Fac. Financing Auth. Rev.
(Hosp. Capital Asset Pooled Program) VRDO 1.10% 6/9/2003 LOC 21,600 21,600
New Jersey Health Care Fac. Financing Auth. Rev.
(Hosp. Capital Asset Pooled Program) VRDO 1.10% 6/9/2003 LOC 13,200 13,200
New Jersey Health Care Fac. Financing Auth. Rev.
(Hosp. Capital Asset Pooled Program) VRDO 1.10% 6/9/2003 LOC 24,500 24,500
New Jersey Health Care Fac. Financing Auth. Rev.
(Meridian Health Systems) VRDO 1.10% 6/9/2003 LOC 14,800 14,800
14
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
New Jersey Health Care Fac. Financing Auth. Rev.
(Meridian Health Systems) VRDO 1.10% 6/9/2003 LOC $ 11,500 $ 11,500
New Jersey Health Care Fac. Financing Auth. Rev.
(Princeton Medical Center) VRDO 1.15% 6/9/2003 LOC 2,200 2,200
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. PUT 1.75% 6/2/2003 (1) 8,500 8,500
New Jersey Housing & Mortgage
Finance Agency Rev. TOB PUT 1.25% 7/13/2003 (1)* 11,980 11,974
New Jersey Housing & Mortgage
Finance Agency Rev. TOB VRDO 1.21% 6/9/2003 (1)* 4,920 4,920
New Jersey Housing & Mortgage
Finance Agency Rev. TOB VRDO 1.21% 6/9/2003 (1)* 1,930 1,930
New Jersey Sports & Exposition Auth. Rev. VRDO 1.10% 6/9/2003 (1) 41,530 41,530
New Jersey TRAN 3.00% 6/12/2003 20,000 20,009
New Jersey Transp. Trust Fund Auth. Rev. TOB PUT 1.85% 6/19/2003 (6)* 14,495 14,495
New Jersey Transp. Trust Fund Auth. Rev. TOB VRDO 1.19% 6/9/2003 (4)* 9,955 9,955
New Jersey Transp. Trust Fund Auth. Rev. TOB VRDO 1.19% 6/9/2003 (4)* 10,455 10,455
New Jersey Transp. Trust Fund Auth. Rev. TOB VRDO 1.24% 6/9/2003 (2)(4)* 25,000 25,000
New Jersey Transp. Trust Fund Auth.
Transp. System TOB VRDO 1.20% 6/9/2003 (4)* 21,995 21,995
New Jersey Turnpike Auth. Rev. TOB VRDO 1.19% 6/9/2003 (1)* 4,995 4,995
New Jersey Turnpike Auth. Rev. TOB VRDO 1.23% 6/9/2003 (1)* 7,620 7,620
New Jersey Turnpike Auth. Rev. VRDO 1.15% 6/9/2003 (3)LOC 166,350 166,350
Passaic County NJ BAN 2.50% 6/13/2003 22,475 22,481
Port Auth. of New York & New Jersey CP 1.05% 7/8/2003 13,270 13,270
Port Auth. of New York & New Jersey CP 1.00% 7/10/2003 2,000 2,000
Port Auth. of New York & New Jersey CP 1.05% 7/10/2003 10,500 10,500
Port Auth. of New York & New Jersey CP 1.10% 7/11/2003 14,845 14,845
Port Auth. of New York & New Jersey CP 1.00% 8/12/2003 10,000 10,000
Port Auth. of New York & New Jersey CP 1.00% 8/14/2003 5,000 5,000
Port Auth. of New York & New Jersey CP 1.00% 8/15/2003 22,600 22,600
Port Auth. of New York & New Jersey Rev. 2.00% 10/15/2003 10,000 10,036
Princeton Univ. New Jersey CP 1.10% 6/24/2003 10,000 10,000
Princeton Univ. New Jersey CP 1.15% 6/25/2003 27,200 27,200
Princeton Univ. New Jersey CP 1.05% 7/16/2003 18,000 18,000
Rahway Valley NJ Sewerage Auth. Sewer Rev. 2.25% 1/14/2004 5,750 5,787
Readington Township NJ BAN 2.125% 2/10/2004 9,000 9,062
Rutgers State Univ. New Jersey VRDO 1.20% 6/2/2003 82,550 82,550
Salem County NJ Financing Auth. PCR
(Atlantic City Electric Co.) VRDO 1.05% 6/9/2003 (1) 3,875 3,875
Salem County NJ Financing Auth. PCR
(Atlantic City Electric Co.) VRDO 1.10% 6/9/2003 (1) 2,200 2,200
Salem County NJ Financing Auth. PCR (Exelon Project) CP 1.00% 8/20/2003 19,000 19,000
Secaucus NJ BAN 2.00% 1/23/2004 4,100 4,122
Somerset County NJ Ind. Fin. Auth. PCR
(American Cyanamid Co.) VRDO 1.70% 6/9/2003 9,300 9,300
Union County NJ BAN 2.40% 8/1/2003 29,872 29,920
Union County NJ PCR (Exxon) VRDO 0.90% 6/2/2003 8,800 8,800
Univ. of Medicine & Dentistry New Jersey Rev. VRDO 1.19% 6/9/2003 (2) 30,000 30,000
West Windsor Plainsboro NJ Regional School Dist. 2.25% 6/26/2003 4,750 4,752
West Windsor Township NJ BAN 2.25% 8/7/2003 11,287 11,303
15
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY TAX-EXEMPT MONEY MARKET FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
OUTSIDE NEW JERSEY:
Puerto Rico Electric Power Auth. Rev. TOB VRDO 1.19% 6/9/2003 (4)* $ 7,600 $ 7,600
Puerto Rico Govt. Dev. Bank VRDO 1.05% 6/9/2003 (1) 23,100 23,100
Puerto Rico Highway & Transp. Auth. Rev. TOB VRDO 1.17% 6/9/2003 (4)* 5,735 5,735
Puerto Rico Highway & Transp. Auth. Rev. TOB VRDO 1.22% 6/9/2003 (1)* 21,550 21,550
Puerto Rico Highway & Transp. Auth. Rev. VRDO 1.10% 6/9/2003 (2) 1,300 1,300
Puerto Rico Ind. Medical & Environmental Fac.
Finance Auth. Rev. PCR (Abbott Laboratories) PUT 1.30% 3/1/2004 * 9,275 9,275
Puerto Rico Infrastructure Financing Auth.
Special Obligation Bonds TOB PUT 1.85% 6/19/2003 * 29,105 29,105
Puerto Rico Infrastructure Financing Auth.
Special Obligation Bonds TOB PUT 1.22% 10/16/2003 * 8,915 8,915
Puerto Rico TRAN 2.50% 7/30/2003 10,000 10,016
- --------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS (Cost $1,823,258) 1,823,258
- --------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (0.6%)
- --------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B 19,787
Liabilities (8,851)
-------------
$ 10,936
-------------
- --------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%)
- --------------------------------------------------------------------------------------------------------------------------
Applicable to 1,833,727,764 outstanding $.001 par value shares of beneficial
interest (unlimited authorization) $ 1,834,194
- --------------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE $ 1.00
==========================================================================================================================
*See Note A in Notes to Financial Statements.
*Securities exempt from registration under Rule 144A of the Securities Act of
1933. These securities may be sold in transactions exempt from registration,
normally to qualified institutional buyers. At May 31, 2003, the aggregate value
of these securities was $337,159,000, representing 18.4% of net assets. For key
to abbreviations and other references, see page 26.
- --------------------------------------------------------------------------------
AT MAY 31, 2003, NET ASSETS CONSISTED OF:
- --------------------------------------------------------------------------------
AMOUNT PER
(000) SHARE
- --------------------------------------------------------------------------------
Amount Per (000) Share Paid-in Capital $ 1,833,967 $ 1.00
Undistributed Net Investment Income -- --
Accumulated Net Realized Gains 227 --
Unrealized Appreciation -- --
- --------------------------------------------------------------------------------
NET ASSETS $ 1,834,194 $ 1.00
================================================================================
16
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS (99.9%)
- --------------------------------------------------------------------------------------------------------------------------
Atlantic City NJ Board of Educ. GO 6.00% 12/1/2012 (4) $ 4,600 $ 5,739
Atlantic City NJ Board of Educ. GO 6.10% 12/1/2015 (4) 2,000 2,543
Atlantic City NJ GO 5.25% 12/15/2012 (4) 1,990 2,277
Atlantic City NJ GO 5.25% 12/15/2014 (4) 2,190 2,511
Atlantic County NJ Public Fac. COP 7.40% 3/1/2010 (3) 1,755 2,251
Atlantic County NJ Public Fac. COP 7.40% 3/1/2011 (3) 4,025 5,221
Atlantic County NJ Public Fac. COP 6.00% 3/1/2014 (3) 3,685 4,520
Atlantic County NJ Public Fac. COP 6.00% 3/1/2015 (3) 1,480 1,826
Atlantic County NJ Util. Auth. Sewer Rev. 6.875% 1/1/2012 (2)(ETM) 2,460 2,968
Atlantic County NJ Util. Auth. Sewer Rev. 5.85% 1/15/2015 (2) 3,000 3,137
Bayonne NJ Muni. Util. Auth. Water System Rev. 5.00% 4/1/2016 (6)* 1,255 1,403
Bayonne NJ Muni. Util. Auth. Water System Rev. 5.00% 4/1/2017 (6)* 1,315 1,458
Bayonne NJ Muni. Util. Auth. Water System Rev. 5.00% 4/1/2021 (6)* 1,600 1,724
Bayonne NJ Muni. Util. Auth. Water System Rev. 5.00% 4/1/2024 (6)* 1,545 1,637
Camden County NJ Improvement Auth. Lease Rev. 5.50% 9/1/2015 (4) 1,470 1,696
Camden County NJ Improvement Auth. Lease Rev. 5.50% 5/1/2016 1,140 1,326
Camden County NJ Improvement Auth. Lease Rev. 5.50% 5/1/2017 1,025 1,183
Camden County NJ Improvement Auth. Lease Rev. 5.50% 5/1/2018 1,265 1,453
Camden County NJ Improvement Auth. Lease Rev. 5.50% 5/1/2019 1,335 1,527
Camden County NJ Improvement Auth. Lease Rev. 5.375% 9/1/2019 (4) 850 954
Camden County NJ Improvement Auth. Lease Rev.
(Health Services Center) 5.00% 12/1/2032 (1) 4,070 4,313
Camden County NJ Muni. Util. Auth. Rev. 0.00% 9/1/2004 (3) 8,345 8,204
Camden County NJ Muni. Util. Auth. Rev. 0.00% 9/1/2005 (3) 18,545 17,917
Camden County NJ Muni. Util. Auth. Rev. 0.00% 9/1/2006 (3) 18,545 17,480
Cape May County NJ Muni. Util. Auth. Rev. 5.75% 1/1/2014 (4) 6,930 8,429
Cape May County NJ Muni. Util. Auth. Rev. 5.25% 1/1/2017 (1) 2,560 2,880
Cape May County NJ Muni. Util. Auth. Rev. 5.25% 1/1/2018 (1) 2,165 2,423
Cape May County NJ PCR (Atlantic City Electric) 6.80% 3/1/2021 (1) 15,400 20,785
Delaware River & Bay Auth. Rev. 5.375% 1/1/2013 (2) 750 860
Delaware River & Bay Auth. Rev. 5.75% 1/1/2029 (2) 5,000 5,703
Delaware River & Bay Auth. Rev. 5.00% 1/1/2033 4,000 4,234
Delaware River Joint Toll Bridge Comm.
Pennsylvania & New Jersey Rev. 5.40% 1/1/2013 (3) 6,750 7,452
Delaware River Joint Toll Bridge Comm.
Pennsylvania & New Jersey Rev. 5.625% 1/1/2013 (4) 4,205 4,849
Delaware River Joint Toll Bridge Comm.
Pennsylvania & New Jersey Rev. 5.75% 1/1/2022 (4) 10,000 11,467
Delaware River Joint Toll Bridge Comm.
Pennsylvania & New Jersey Rev. 5.50% 1/1/2026 (3) 22,885 25,280
Delaware River Joint Toll Bridge Comm.
Pennsylvania & New Jersey Rev. 5.625% 1/1/2026 (4) 5,000 5,609
Egg Harbor Township NJ School Dist. GO 5.00% 7/15/2012 (3) 2,640 3,032
Egg Harbor Township NJ School Dist. GO 5.00% 7/15/2013 (3) 2,780 3,169
Egg Harbor Township NJ School Dist. GO 5.00% 7/15/2020 (3) 2,000 2,183
Egg Harbor Township NJ School Dist. GO 5.00% 7/15/2021 (3) 1,400 1,517
Egg Harbor Township NJ School Dist. GO 5.10% 7/15/2022 (3) 2,950 3,202
Essex County NJ Improvement Auth. Lease Rev. 5.50% 12/1/2008 (2) 2,560 2,667
Essex County NJ Improvement Auth. Lease Rev. 5.50% 12/1/2013 (2) 5,150 5,355
Essex County NJ Improvement Auth. Lease Rev. 5.75% 10/1/2014 (3) 3,390 3,985
Essex County NJ Improvement Auth. Lease Rev. 5.75% 10/1/2015 (3) 5,090 5,965
17
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
Essex County NJ Improvement Auth. Lease Rev. 5.75% 10/1/2030 (3) $ 2,650 $ 3,026
Essex County NJ Solid Waste Util. Auth. 5.60% 4/1/2006 (4)(Prere.) 2,200 2,499
Essex County NJ Solid Waste Util. Auth. 0.00% 4/1/2010 (4) 1,000 811
Essex County NJ Solid Waste Util. Auth. 4.875% 4/1/2018 (4) 3,500 3,686
Evesham NJ Util. Auth. Rev. 5.00% 7/1/2016 (2) 3,435 3,841
Evesham NJ Util. Auth. Rev. 5.00% 7/1/2017 (2) 3,705 4,113
Evesham NJ Util. Auth. Rev. 5.00% 7/1/2018 (2) 1,605 1,770
Freehold NJ Regional High School Dist. GO 5.00% 3/1/2014 (3) 1,000 1,160
Freehold NJ Regional High School Dist. GO 5.00% 3/1/2016 (3) 2,000 2,315
Freehold NJ Regional High School Dist. GO 5.00% 3/1/2019 (3) 2,440 2,800
Garden State Preservation Trust NJ 0.00% 11/1/2021 (4) 11,325 5,089
Garden State Preservation Trust NJ 5.00% 11/1/2021 7,500 8,174
Garden State Preservation Trust NJ 0.00% 11/1/2022 (4) 41,150 17,406
Garden State Preservation Trust NJ 0.00% 11/1/2023 (4) 15,000 5,998
Gloucester County NJ Improvement Auth. Lease Rev. 5.00% 7/15/2016 (1)* 1,000 1,115
Gloucester County NJ Improvement Auth. Lease Rev. 5.00% 7/15/2017 (1)* 1,000 1,107
Gloucester County NJ Improvement Auth. Lease Rev. 5.00% 7/15/2020 (1)* 1,150 1,248
Gloucester County NJ Improvement Auth. Lease Rev. 5.00% 7/15/2023 (1)* 1,000 1,067
Gloucester Township NJ GO 5.75% 7/15/2010 (2) 2,880 3,446
Gloucester Township NJ Muni. Util. Auth. Rev. 5.65% 3/1/2018 (2) 2,755 3,365
Higher Educ. Assistance Auth. of New Jersey
Student Loan Rev. 6.00% 6/1/2013 (1) 3,000 3,397
Higher Educ. Assistance Auth. of New Jersey
Student Loan Rev. 6.00% 6/1/2015 (1) 5,575 6,242
Higher Educ. Assistance Auth. of New Jersey
Student Loan Rev. 6.10% 6/1/2016 (1) 3,000 3,359
Hillsborough Township NJ School Dist. GO 5.375% 10/1/2013 (4) 1,250 1,491
Hillsborough Township NJ School Dist. GO 5.375% 10/1/2015 (4) 1,720 2,056
Hillsborough Township NJ School Dist. GO 5.375% 10/1/2017 (4) 720 862
Hillsborough Township NJ School Dist. GO 5.375% 10/1/2019 (4) 1,720 2,047
Hoboken-Union City-Weehawken NJ Sewerage Auth. Rev. 0.00% 8/1/2003 (1) 3,800 3,792
Hoboken-Union City-Weehawken NJ Sewerage Auth. Rev. 0.00% 8/1/2004 (1) 3,750 3,693
Hoboken-Union City-Weehawken NJ Sewerage Auth. Rev. 0.00% 8/1/2005 (1) 3,805 3,685
Hoboken-Union City-Weehawken NJ Sewerage Auth. Rev. 0.00% 8/1/2006 (1) 2,000 1,891
Hoboken-Union City-Weehawken NJ Sewerage Auth. Rev. 6.25% 8/1/2013 (1) 9,590 12,150
Hopewell Valley NJ Regional School Dist. GO 5.00% 8/15/2013 (3) 2,315 2,590
Hudson County NJ GO 6.55% 7/1/2007 (3) 1,300 1,533
Hudson County NJ GO 6.55% 7/1/2009 (3) 635 779
Irvington Township NJ GO 0.00% 8/1/2007 (1) 1,000 912
Irvington Township NJ GO 0.00% 8/1/2009 (1) 2,580 2,176
Irvington Township NJ GO 0.00% 8/1/2010 (1) 2,080 1,668
Jackson Township NJ Board of Educ. GO 5.375% 4/15/2026 (3) 6,885 7,554
Jackson Township NJ Board of Educ. GO 5.375% 4/15/2027 (3) 7,676 8,418
Marlboro Township NJ Board of Educ. GO 5.00% 7/15/2012 1,005 1,143
Marlboro Township NJ Board of Educ. GO 5.00% 7/15/2013 1,000 1,128
Marlboro Township NJ Board of Educ. GO 5.25% 7/15/2013 (4) 2,625 2,972
Marlboro Township NJ Board of Educ. GO 5.00% 7/15/2014 1,045 1,167
Marlboro Township NJ Board of Educ. GO 5.25% 7/15/2014 (4) 2,790 3,155
Marlboro Township NJ Board of Educ. GO 5.25% 7/15/2018 (4) 2,850 3,176
Mercer County NJ Improvement Auth. Library System Rev. 6.00% 12/1/2003 (Prere.) 1,000 1,045
Mercer County NJ Improvement Auth. Solid Waste Rev. 5.375% 9/15/2012 11,120 12,681
18
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
Mercer County NJ Improvement Auth.
Special Services School Dist. Rev. 5.75% 12/15/2008 $ 1,165 $ 1,375
Mercer County NJ Improvement Auth.
Special Services School Dist. Rev. 5.95% 12/15/2012 4,895 6,036
Middlesex County NJ COP 5.00% 8/1/2011 (1) 1,050 1,209
Middlesex County NJ COP 5.50% 8/1/2015 (1) 1,195 1,380
Middlesex County NJ Improvement Auth.
Util. Systems Rev. (Perth Amboy) 0.00% 9/1/2015 (2) 2,000 1,264
Middlesex County NJ Improvement Auth.
Util. Systems Rev. (Perth Amboy) 0.00% 9/1/2016 (2) 3,000 1,800
Middlesex County NJ Improvement Auth.
Util. Systems Rev. (Perth Amboy) 0.00% 9/1/2018 (2) 4,550 2,457
Middlesex County NJ Util. Auth. Sewer Rev. 5.25% 3/15/2010 (3) 1,740 1,926
Middlesex County NJ Util. Auth. Sewer Rev. 5.375% 9/15/2015 (3) 3,775 4,149
Middlesex County NJ Util. Auth. Sewer Rev. 5.125% 12/1/2016 (3) 3,050 3,399
Middletown Township NJ Board of Educ. GO 5.00% 8/1/2014 (4) 2,735 3,055
Middletown Township NJ Board of Educ. GO 5.00% 8/1/2015 (4) 2,015 2,232
Monmouth County NJ Improvement Auth. Rev.
(Howell Township Board of Educ.) 5.80% 7/15/2007 (2)(Prere.) 1,180 1,375
Monmouth County NJ Improvement Auth.
(Howell Township Board of Educ.) 5.00% 7/15/2013 (2) 1,305 1,490
Monmouth County NJ Improvement Auth. Rev.
(Howell Township Board of Educ.) 5.00% 7/15/2019 (2) 2,115 2,318
Monmouth County NJ Improvement Auth. Rev.
(Howell Township Board of Educ.) 5.00% 7/15/2020 (2) 2,225 2,422
Monmouth County NJ Improvement Auth. Rev.
(Howell Township Board of Educ.) 5.00% 7/15/2021 (2) 2,340 2,528
Monroe Township NJ Muni. Util. Auth.
Middlesex County Rev. 5.25% 2/1/2013 (3) 1,210 1,378
Monroe Township NJ Muni. Util. Auth.
Middlesex County Rev. 5.25% 2/1/2014 (3) 1,235 1,401
Montgomery Township NJ School Dist. GO 5.25% 8/1/2013 (1) 1,285 1,488
Montgomery Township NJ School Dist. GO 5.25% 8/1/2017 (1) 1,280 1,448
Montgomery Township NJ School Dist. GO 5.25% 8/1/2018 (1) 1,280 1,441
Mount Laurel Township NJ Muni. Util. Auth.
Util. System Rev. 6.00% 7/1/2004 (1)(Prere.) 2,580 2,718
New Brunswick NJ Housing & Urban Dev. Rev. 6.00% 7/1/2012 (1) 195 200
New Brunswick NJ Housing & Urban Dev. Rev. 5.75% 7/1/2024 (1) 440 450
New Jersey Econ. Dev. Auth. Lease Rev.
(Bergen County Administration Complex) 5.50% 11/15/2012 (1) 4,375 5,047
New Jersey Econ. Dev. Auth. Lease Rev.
(Bergen County Administration Complex) 5.625% 11/15/2014 (1) 4,870 5,644
New Jersey Econ. Dev. Auth. Lease Rev.
(Bergen County Administration Complex) 5.75% 11/15/2016 (1) 5,440 6,324
New Jersey Econ. Dev. Auth. Lease Rev.
(Bergen County Administration Complex) 5.75% 11/15/2018 (1) 6,080 7,051
New Jersey Econ. Dev. Auth. Market Transition Fac. Rev. 5.80% 7/1/2004 (1)(Prere.) 1,000 1,071
New Jersey Econ. Dev. Auth. Rev.
(Hillcrest Health Service) 0.00% 1/1/2012 (2) 2,500 1,867
New Jersey Econ. Dev. Auth. Rev.
(Hillcrest Health Service) 0.00% 1/1/2013 (2) 3,000 2,141
New Jersey Econ. Dev. Auth. Rev.
(Kapkowski Road Landfill-DST Project Elizabeth) 6.50% 4/1/2028 7,500 8,404
19
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
New Jersey Econ. Dev. Auth. Rev.
(Lawrenceville School Project) VRDO 1.20% 6/2/2003 $ 14,400 $ 14,400
New Jersey Econ. Dev. Auth. Rev.
(Lawrenceville School Project) VRDO 1.20% 6/2/2003 11,200 11,200
New Jersey Econ. Dev. Auth. Rev.
(Masonic Charity Foundation) 5.875% 6/1/2018 1,250 1,448
New Jersey Econ. Dev. Auth. Rev.
(Masonic Charity Foundation) 6.00% 6/1/2025 1,000 1,141
New Jersey Econ. Dev. Auth. Rev.
(Masonic Charity Foundation) 5.50% 6/1/2031 1,665 1,806
New Jersey Econ. Dev. Auth. Rev. (School Fac.) 5.50% 6/15/2013 (2) 1,200 1,436
New Jersey Econ. Dev. Auth. Rev. (School Fac.) 5.25% 6/15/2017 (2) 7,040 7,882
New Jersey Econ. Dev. Auth. Rev. (St. Barnabas Project) 0.00% 7/1/2008 (1) 2,305 2,031
New Jersey Econ. Dev. Auth. Rev. (St. Barnabas Project) 0.00% 7/1/2011 (1) 4,650 3,566
New Jersey Econ. Dev. Auth. Rev. (St. Barnabas Project) 0.00% 7/1/2012 (1) 4,550 3,338
New Jersey Econ. Dev. Auth. Rev. (St. Barnabas Project) 0.00% 7/1/2013 (1) 4,500 3,154
New Jersey Econ. Dev. Auth. Rev. (St. Barnabas Project) 0.00% 7/1/2014 (1) 4,210 2,804
New Jersey Econ. Dev. Auth. Rev. (Transp. Project) 5.875% 5/1/2015 (4) 3,465 4,012
New Jersey Econ. Dev. Auth. Rev. (Transp. Project) 5.25% 5/1/2017 (4) 4,500 5,034
New Jersey Econ. Dev. Auth. Rev. PCR (Exxon) VRDO 0.90% 6/2/2003 1,500 1,500
New Jersey Educ. Fac. Auth. Rev. 5.875% 9/1/2007 (2) 5,890 6,838
New Jersey Educ. Fac. Auth. Rev. 5.875% 9/1/2008 (2) 6,165 7,286
New Jersey Educ. Fac. Auth. Rev. 5.75% 9/1/2012 7,595 9,187
New Jersey Educ. Fac. Auth. Rev. 5.00% 3/1/2016 (1) 3,845 4,218
New Jersey Educ. Fac. Auth. Rev. 5.75% 9/1/2016 (4) 8,425 9,859
New Jersey Educ. Fac. Auth. Rev. 5.00% 9/1/2019 (4) 2,715 2,929
New Jersey Educ. Fac. Auth. Rev. 5.00% 9/1/2020 11,405 12,211
New Jersey Educ. Fac. Auth. Rev. (Drew Univ.) 5.25% 7/1/2020 2,060 2,404
New Jersey Educ. Fac. Auth. Rev. (Drew Univ.) 5.25% 7/1/2021 (3) 1,550 1,798
New Jersey Educ. Fac. Auth. Rev.
(New Jersey Institute of Technology) 5.25% 7/1/2017 (1) 1,000 1,120
New Jersey Educ. Fac. Auth. Rev.
(New Jersey Institute of Technology) 5.25% 7/1/2018 (1) 1,470 1,638
New Jersey Educ. Fac. Auth. Rev.
(New Jersey Institute of Technology) 5.25% 7/1/2020 (1) 1,725 1,898
New Jersey Educ. Fac. Auth. Rev.
(New Jersey Institute of Technology) 6.00% 7/1/2024 (1) 1,500 1,597
New Jersey Educ. Fac. Auth. Rev. (Princeton Univ.) VRDO 1.25% 6/2/2003 11,900 11,900
New Jersey Educ. Fac. Auth. Rev. (Princeton Univ.) VRDO 1.25% 6/2/2003 2,330 2,330
New Jersey Educ. Fac. Auth. Rev. (Ramapo College) 5.00% 7/1/2015 (3) 1,550 1,746
New Jersey Educ. Fac. Auth. Rev. (Ramapo College) 5.00% 7/1/2015 (3) 1,600 1,803
New Jersey Educ. Fac. Auth. Rev. (Ramapo College) 5.00% 7/1/2017 (3) 1,700 1,887
New Jersey Educ. Fac. Auth. Rev. (Ramapo College) 5.00% 7/1/2017 (3) 1,765 1,959
New Jersey Educ. Fac. Auth. Rev. (Ramapo College) 5.00% 7/1/2019 (3) 1,945 2,131
New Jersey Educ. Fac. Auth. Rev. (Ramapo College) 5.625% 7/1/2019 (1) 2,105 2,421
New Jersey Educ. Fac. Auth. Rev. (Ramapo College) 5.00% 7/1/2020 (3) 1,010 1,099
New Jersey Educ. Fac. Auth. Rev. (Ramapo College) 5.00% 7/1/2031 (2) 1,000 1,049
New Jersey Educ. Fac. Auth. Rev. (Rowan Univ.) 5.25% 7/1/2014 (3) 2,305 2,650
New Jersey Educ. Fac. Auth. Rev. (Rowan Univ.) 5.25% 7/1/2015 (3) 1,880 2,144
New Jersey Educ. Fac. Auth. Rev. (Rowan Univ.) 5.25% 7/1/2016 (3) 2,050 2,324
New Jersey Educ. Fac. Auth. Rev. (Rowan Univ.) 5.25% 7/1/2024 (3) 11,210 12,107
New Jersey Educ. Fac. Auth. Rev. (Rowan Univ.) 5.00% 7/1/2031 (3) 1,965 2,071
20
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
New Jersey Educ. Fac. Auth. Rev. (Seton Hall Univ.) 5.25% 7/1/2010 (2) $ 1,500 $ 1,722
New Jersey Educ. Fac. Auth. Rev. (Seton Hall Univ.) 5.25% 7/1/2012 (2) 1,275 1,453
New Jersey Educ. Fac. Auth. Rev. (Seton Hall Univ.) 5.25% 7/1/2014 (2) 500 569
New Jersey Educ. Fac. Auth. Rev. (Seton Hall Univ.) 5.25% 7/1/2015 (2) 400 452
New Jersey Educ. Fac. Auth. Rev. (Seton Hall Univ.) 5.25% 7/1/2016 (2) 200 225
New Jersey Educ. Fac. Auth. Rev. (Seton Hall Univ.) 5.60% 7/1/2016 (1) 1,000 1,115
New Jersey Educ. Fac. Auth. Rev. (Seton Hall Univ.) 5.625% 7/1/2019 (1) 3,625 4,034
New Jersey Educ. Fac. Auth. Rev.
(Stevens Institute of Technology) 5.125% 7/1/2022 4,000 4,184
New Jersey Educ. Fac. Auth. Rev.
(Stevens Institute of Technology) 5.25% 7/1/2032 6,000 6,189
New Jersey Educ. Fac. Auth. Rev. (William Patterson) 5.20% 7/1/2015 (3) 755 850
New Jersey Educ. Fac. Auth. Rev. (William Patterson) 5.30% 7/1/2017 (3) 250 281
New Jersey Educ. Fac. Auth. Rev. (William Patterson) 5.375% 7/1/2018 (3) 905 1,021
New Jersey Educ. Fac. Auth. Rev. (William Patterson) 5.375% 7/1/2019 (3) 360 404
New Jersey Environmental Infrastructure Trust
Wastewater Treatment Rev. 5.125% 9/1/2015 5,090 5,714
New Jersey Environmental Infrastructure Trust
Wastewater Treatment Rev. 5.00% 9/1/2017 1,525 1,682
New Jersey Health Care Fac. Financing Auth. Rev.
(Atlantic City Medical Center) 6.00% 7/1/2008 2,530 2,875
New Jersey Health Care Fac. Financing Auth. Rev.
(Atlantic City Medical Center) 6.25% 7/1/2017 3,950 4,499
New Jersey Health Care Fac. Financing Auth. Rev.
(Atlantic City Medical Center) 5.75% 7/1/2025 5,000 5,392
New Jersey Health Care Fac. Financing Auth. Rev.
(Community Medical Center/Kimball Medical Center/
Kensington Manor Care Center) 5.25% 7/1/2009 (4) 5,500 6,255
New Jersey Health Care Fac. Financing Auth. Rev.
(Community Medical Center/Kimball Medical Center/
Kensington Manor Care Center) 5.00% 7/1/2010 (4) 4,695 5,210
New Jersey Health Care Fac. Financing Auth. Rev.
(Community Medical Center/Kimball Medical Center/
Kensington Manor Care Center) 5.25% 7/1/2012 (4) 1,500 1,687
New Jersey Health Care Fac. Financing Auth. Rev.
(Hackensack Univ. Medical Center) 5.375% 1/1/2013 (1) 2,355 2,636
New Jersey Health Care Fac. Financing Auth. Rev.
(Hackensack Univ. Medical Center) 5.375% 1/1/2014 (1) 2,965 3,324
New Jersey Health Care Fac. Financing Auth. Rev.
(Holy Name Hosp.) 5.25% 7/1/2020 (2) 4,100 4,459
New Jersey Health Care Fac. Financing Auth. Rev.
(Jersey Shore Medical Center) 6.20% 7/1/2004 (2)(Prere.) 1,755 1,886
New Jersey Health Care Fac. Financing Auth. Rev.
(Jersey Shore Medical Center) 6.25% 7/1/2004 (2)(Prere.) 1,140 1,226
New Jersey Health Care Fac. Financing Auth. Rev.
(Jersey Shore Medical Center) 6.20% 7/1/2013 (2) 1,345 1,437
New Jersey Health Care Fac. Financing Auth. Rev.
(Jersey Shore Medical Center) 6.20% 7/1/2014 (2) 1,320 1,410
New Jersey Health Care Fac. Financing Auth. Rev.
(Jersey Shore Medical Center) 6.25% 7/1/2016 (2) 860 919
New Jersey Health Care Fac. Financing Auth. Rev.
(Mercer Medical Center) 6.50% 7/1/2010 (1) 6,000 6,027
21
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
New Jersey Health Care Fac. Financing Auth. Rev.
(Meridian Health System Obligated Group) 5.625% 7/1/2012 (4) $ 3,710 $ 4,270
New Jersey Health Care Fac. Financing Auth. Rev.
(Meridian Health System Obligated Group) 5.625% 7/1/2013 (4) 7,355 8,465
New Jersey Health Care Fac. Financing Auth. Rev.
(Meridian Health System Obligated Group) 5.25% 7/1/2029 (4) 13,450 14,241
New Jersey Health Care Fac. Financing Auth. Rev.
(Mountainside Hosp.) 5.35% 7/1/2007 (1) 3,215 3,291
New Jersey Health Care Fac. Financing Auth. Rev.
(Riverside Medical Center) 6.25% 7/1/2010 (2)(ETM) 2,935 3,615
New Jersey Health Care Fac. Financing Auth. Rev.
(South Jersey Hosp.) 5.875% 7/1/2021 3,500 3,695
New Jersey Health Care Fac. Financing Auth. Rev.
(South Jersey Hosp.) 6.00% 7/1/2026 3,500 3,685
New Jersey Health Care Fac. Financing Auth. Rev.
(South Jersey Hosp.) 6.00% 7/1/2032 3,000 3,145
New Jersey Health Care Fac. Financing Auth. Rev.
(St. Barnabas Health Care) 5.25% 7/1/2013 (1) 3,000 3,364
New Jersey Health Care Fac. Financing Auth. Rev.
(St. Barnabas Health Care) 5.25% 7/1/2016 (1) 3,300 3,674
New Jersey Health Care Fac. Financing Auth. Rev.
(St. Barnabas Health Care) 0.00% 7/1/2021 (1) 3,000 1,368
New Jersey Health Care Fac. Financing Auth. Rev.
(St. Barnabas Health Care) 4.75% 7/1/2028 (1) 9,330 9,497
New Jersey Health Care Fac. Financing Auth. Rev.
(St. Clares Riverside Medical Center) 5.75% 7/1/2014 (1) 8,500 9,036
New Jersey Health Care Fac. Financing Auth. Rev.
(Virtua Health) 5.25% 7/1/2014 (4) 11,000 12,357
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. 4.95% 6/1/2010 (2) 5,460 5,951
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. 5.05% 6/1/2011 (2) 4,395 4,766
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. 5.05% 6/1/2012 (1) 1,000 1,104
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. 5.15% 6/1/2012 (2) 4,540 4,919
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. 5.10% 6/1/2013 (1) 2,255 2,481
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. 5.20% 6/1/2013 (2) 7,120 7,681
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. 5.125% 6/1/2014 (1) 1,300 1,428
New Jersey Higher Educ. Assistance Auth.
Student Loan Rev. 5.25% 6/1/2018 (1) 705 764
New Jersey Highway Auth. Rev. (Garden State Parkway) 6.20% 1/1/2010 (2) 20,000 24,117
New Jersey Highway Auth. Rev. (Garden State Parkway) 5.50% 1/1/2013 (3) 10,000 11,931
New Jersey Highway Auth. Rev. (Garden State Parkway) 5.50% 1/1/2014 (3) 7,500 8,964
New Jersey Highway Auth. Rev. (Garden State Parkway) 5.50% 1/1/2015 (3) 7,500 8,990
New Jersey Highway Auth. Rev. (Garden State Parkway) 5.50% 1/1/2016 (3) 2,000 2,400
New Jersey Highway Auth. Rev. (Garden State Parkway) 5.60% 1/1/2017 (3) 7,535 8,693
New Jersey Housing & Mortgage Finance Agency
Multi-Family Housing Rev. 5.70% 5/1/2020 (4) 2,895 3,151
22
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
New Jersey Housing & Mortgage Finance Agency Rev.
(Home Buyer) 5.40% 10/1/2020 (1) $ 1,345 $ 1,381
New Jersey Sports & Exposition Auth. Rev. 6.50% 3/1/2013 (1) 10,000 12,453
New Jersey Sports & Exposition Auth. Rev. 5.50% 3/1/2017 (1) 5,755 6,933
New Jersey Sports & Exposition Auth. Rev. VRDO 1.10% 6/9/2003 700 700
New Jersey Sports & Exposition Auth. Rev. VRDO 1.10% 6/9/2003 (1) 100 100
New Jersey Transp. Corp. COP 6.00% 9/15/2009 (2)(Prere.) 10,000 12,113
New Jersey Transp. Corp. COP 5.50% 9/15/2012 (2) 20,000 23,877
New Jersey Transp. Corp. COP 5.50% 9/15/2014 (2) 1,500 1,785
New Jersey Transp. Corp. COP 5.75% 9/15/2014 (2) 2,000 2,349
New Jersey Transp. Corp. COP 5.50% 9/15/2015 (2) 15,000 17,892
New Jersey Transp. Trust Fund Auth. Rev. 5.50% 6/15/2005 (1)(Prere.) 700 775
New Jersey Transp. Trust Fund Auth. Rev. 6.00% 6/15/2007 (2)(Prere.) 16,280 19,215
New Jersey Transp. Trust Fund Auth. Rev. 6.00% 6/15/2010 (Prere.) 5,000 6,089
New Jersey Transp. Trust Fund Auth. Rev. 6.00% 12/15/2011 (1)(Prere.) 2,000 2,487
New Jersey Transp. Trust Fund Auth. Rev. 6.00% 12/15/2011 (1)(Prere.) 13,000 16,131
New Jersey Transp. Trust Fund Auth. Rev. 6.00% 12/15/2011 (1)(Prere.) 5,000 6,204
New Jersey Transp. Trust Fund Auth. Rev. 6.00% 12/15/2011 (1)(Prere.) 15,000 18,612
New Jersey Transp. Trust Fund Auth. Rev. 5.50% 6/15/2013 (1) 2,300 2,520
New Jersey Transp. Trust Fund Auth. Rev. 5.75% 6/15/2020 5,000 6,101
New Jersey Transp. Trust Fund Auth. Rev. 5.00% 12/15/2021 (1) 17,800 18,957
New Jersey Turnpike Auth. Rev. 6.00% 1/1/2013 (1) 1,000 1,233
New Jersey Turnpike Auth. Rev. 6.50% 1/1/2013 (1) 20,000 25,449
New Jersey Turnpike Auth. Rev. 5.75% 1/1/2016 (1) 2,285 2,642
New Jersey Turnpike Auth. Rev. 6.50% 1/1/2016 (1) 28,270 36,139
New Jersey Turnpike Auth. Rev. 5.75% 1/1/2017 (1) 10,000 11,561
New Jersey Turnpike Auth. Rev. 5.375% 1/1/2020 (1) 3,500 3,890
New Jersey Turnpike Auth. Rev. 5.50% 1/1/2025 (1) 1,800 1,991
New Jersey Turnpike Auth. Rev. VRDO 1.15% 6/9/2003 (3)LOC 9,800 9,800
New Jersey Water Supply Auth. Delaware & Raritan
Water System Rev. 5.375% 11/1/2010 (1) 2,230 2,516
New Jersey Water Supply Auth. Delaware & Raritan
Water System Rev. 5.375% 11/1/2011 (1) 2,345 2,622
New Jersey Water Supply Auth. Delaware & Raritan
Water System Rev. 5.375% 11/1/2013 (1) 2,600 2,874
Newark NJ GO 5.50% 10/1/2008 (2) 1,660 1,931
Newark NJ School Dist. GO 5.375% 12/15/2013 (1) 2,000 2,348
North Bergen Township NJ GO 8.00% 8/15/2006 (4) 1,885 2,264
North Hudson NJ Sewer Auth. Rev. 5.125% 8/1/2008 (3) 2,000 2,234
North Hudson NJ Sewer Auth. Rev. 5.25% 8/1/2016 (3) 14,360 15,855
North Hudson NJ Sewer Auth. Rev. 5.125% 8/1/2022 (3) 4,000 4,167
North Jersey Water Dist. Rev.
(Wanaque South Project) 6.00% 7/1/2003 (1)(Prere.) 10,125 10,370
Ocean County NJ Util. Auth. Wastewater Rev. 6.30% 1/1/2005 (Prere.) 2,215 2,417
Ocean County NJ Util. Auth. Wastewater Rev. 6.35% 1/1/2005 (Prere.) 2,360 2,577
Ocean County NJ Util. Auth. Wastewater Rev. 6.35% 1/1/2005 (Prere.) 2,515 2,746
Ocean County NJ Util. Auth. Wastewater Rev. 5.00% 1/1/2014 6,000 6,899
Ocean County NJ Util. Auth. Wastewater Rev. 5.25% 1/1/2017 2,665 2,993
Ocean County NJ Util. Auth. Wastewater Rev. 5.25% 1/1/2018 2,345 2,621
Ocean County NJ Util. Auth. Wastewater Rev. 6.60% 1/1/2018 (3)(ETM) 2,500 3,239
Plainfield NJ Board of Educ. GO 5.00% 8/1/2020 (4) 1,500 1,606
Port Auth. of New York & New Jersey Rev. 5.125% 11/15/2012 (3) 2,500 2,736
Port Auth. of New York & New Jersey Rev. 5.125% 11/15/2013 (3) 5,735 6,242
23
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
Port Auth. of New York & New Jersey Rev. 5.125% 11/15/2014 (3) $ 6,025 $ 6,557
Port Auth. of New York & New Jersey Rev. 5.50% 12/15/2014 (2) 2,790 3,254
Port Auth. of New York & New Jersey Rev. 5.00% 8/1/2015 3,370 3,568
Port Auth. of New York & New Jersey Rev. 5.875% 9/15/2015 (3) 10,000 11,219
Port Auth. of New York & New Jersey Rev. 5.50% 12/15/2019 (2) 5,125 5,823
Port Auth. of New York & New Jersey Rev. 5.20% 7/15/2021 (2) 3,250 3,384
Port Auth. of New York & New Jersey Rev. 5.375% 7/15/2022 (3) 15,000 16,691
Port Auth. of New York & New Jersey Rev. 5.125% 10/15/2030 (1) 6,725 7,011
Port Auth. of New York & New Jersey Rev. 5.375% 10/15/2035 (1) 3,000 3,282
Rutgers State Univ. New Jersey 6.40% 5/1/2013 3,000 3,694
Rutgers State Univ. New Jersey VRDO 1.20% 6/2/2003 7,100 7,100
Salem County NJ Financing Auth. PCR
(Atlantic City Electric Co.) VRDO 1.10% 6/9/2003 (1) 800 800
South Brunswick Township NJ Board of Educ. GO 6.40% 8/1/2005 (3)(Prere.) 2,205 2,451
South Brunswick Township NJ Board of Educ. GO 5.25% 8/1/2020 (3) 1,785 1,969
South Brunswick Township NJ Board of Educ. GO 5.25% 8/1/2022 (3) 3,000 3,267
South Jersey Port Corp. New Jersey Rev. 5.00% 1/1/2023 2,000 2,095
South Jersey Port Corp. New Jersey Rev. 5.20% 1/1/2023 1,500 1,573
South Jersey Port Corp. New Jersey Rev. 5.10% 1/1/2033 2,000 2,075
South Jersey Transp. Auth.
New Jersey Transp. System Rev. 5.25% 11/1/2013 (2) 4,000 4,585
South Jersey Transp. Auth.
New Jersey Transp. System Rev. 5.25% 11/1/2014 (2) 4,125 4,723
South Jersey Transp. Auth.
New Jersey Transp. System Rev. 5.00% 11/1/2029 (2) 9,850 10,330
Stafford NJ Muni. Util. Auth. Water & Sewer Rev. 5.50% 6/1/2011 (3) 3,100 3,660
Toms River NJ School Dist. GO 5.00% 1/15/2020 (4) 1,510 1,614
Toms River NJ School Dist. GO 5.00% 1/15/2021 (4) 1,600 1,701
Union County NJ Improvement Auth. Rev.
(Plainfield Board of Educ.) 5.80% 8/1/2007 (3)(Prere.) 4,000 4,667
Union County NJ PCR (Exxon) VRDO 0.90% 6/2/2003 2,300 2,300
Union County NJ PCR (Exxon) VRDO 1.10% 6/2/2003 26,200 26,200
Union County NJ Util. Auth. Rev. (Ogden Martin) 5.25% 6/1/2006 (2) 5,375 5,903
Union County NJ Util. Auth. Rev. (Ogden Martin) 5.375% 6/1/2011 (2) 8,375 9,186
Union County NJ Util. Auth. Rev. (Ogden Martin) 5.375% 6/1/2012 (2) 8,995 9,816
Union County NJ Util. Auth. Rev. (Ogden Martin) 5.375% 6/1/2013 (2) 9,445 10,245
Univ. of Medicine & Dentistry New Jersey COP 5.00% 4/15/2025 (2) 1,650 1,757
Univ. of Medicine & Dentistry New Jersey COP 5.00% 4/15/2032 (2) 3,250 3,437
Univ. of Medicine & Dentistry New Jersey Rev. 6.50% 12/1/2012 (1)(ETM) 4,000 4,961
Univ. of Medicine & Dentistry New Jersey Rev. 5.375% 12/1/2015 (2) 2,325 2,708
Univ. of Medicine & Dentistry New Jersey Rev. 5.375% 12/1/2016 (2) 1,110 1,284
Univ. of Medicine & Dentistry New Jersey Rev. 5.50% 12/1/2018 (2) 1,250 1,444
Univ. of Medicine & Dentistry New Jersey Rev. 5.50% 12/1/2019 (2) 3,000 3,450
Univ. of Medicine & Dentistry New Jersey Rev. 5.50% 12/1/2020 (2) 3,675 4,207
Univ. of Medicine & Dentistry New Jersey Rev. 5.50% 12/1/2021 (2) 2,000 2,281
Univ. of Medicine & Dentistry New Jersey Rev. 5.50% 12/1/2023 (2) 7,330 8,285
Univ. of Medicine & Dentistry New Jersey Rev. 5.50% 12/1/2027 (2) 10,100 11,264
Vernon Township NJ School Dist. GO 5.25% 12/1/2014 (3) 1,200 1,366
Vernon Township NJ School Dist. GO 5.30% 12/1/2015 (3) 1,200 1,366
Vernon Township NJ School Dist. GO 5.375% 12/1/2016 (3) 1,200 1,368
Vernon Township NJ School Dist. GO 5.375% 12/1/2017 (3) 1,200 1,363
Vernon Township NJ School Dist. GO 5.375% 12/1/2018 (3) 1,200 1,357
24
- --------------------------------------------------------------------------------------------------------------------------
FACE MARKET
MATURITY AMOUNT VALUE*
NEW JERSEY LONG-TERM TAX-EXEMPT FUND COUPON DATE (000) (000)
- --------------------------------------------------------------------------------------------------------------------------
West Orange NJ Board of Educ. COP 5.625% 10/1/2019 (1) $ 2,500 $ 2,879
West Orange NJ Board of Educ. COP 6.00% 10/1/2024 (1) 1,000 1,180
West Orange NJ Board of Educ. COP 5.625% 10/1/2029 (1) 2,000 2,252
West Windsor Plainsboro NJ Regional School Dist. 5.00% 12/1/2011 (4) 2,700 3,123
West Windsor Plainsboro NJ Regional School Dist. 5.00% 12/1/2012 (4) 2,720 3,158
West Windsor Plainsboro NJ Regional School Dist. 5.00% 12/1/2013 (4) 2,215 2,549
West Windsor Plainsboro NJ Regional School Dist. 5.00% 12/1/2014 (4) 1,000 1,146
West Windsor Plainsboro NJ Regional School Dist. 5.00% 12/1/2015 (4) 1,000 1,136
OUTSIDE NEW JERSEY:
Guam Govt. Ltd. Obligation Infrastructure
Improvement Rev. 5.125% 11/1/2011 (2) 3,400 3,846
Puerto Rico Electric Power Auth. Rev. 5.25% 7/1/2017 (1) 3,200 3,607
Puerto Rico GO 5.50% 7/1/2013 (3) 4,000 4,822
Puerto Rico GO 5.50% 7/1/2014 (3) 2,000 2,414
Puerto Rico GO 5.50% 7/1/2017 (6) 5,000 6,018
Puerto Rico GO 5.00% 7/1/2018 (1) 11,500 12,710
Puerto Rico GO 5.50% 7/1/2018 5,540 6,372
Puerto Rico GO 5.00% 7/1/2024 (4) 10,000 10,593
Puerto Rico Govt. Dev. Bank VRDO 1.05% 6/9/2003 (1) 3,600 3,600
Puerto Rico Highway & Transp. Auth. Rev. VRDO 1.10% 6/9/2003 (2) 7,700 7,700
Puerto Rico Housing Finance Corp. Home Mortgage Rev. 5.30% 12/1/2028 3,000 3,132
Puerto Rico Infrastructure Financing Auth.
Special Tax Rev. 5.00% 7/1/2021 (2) 8,000 8,430
Puerto Rico Muni. Finance Agency 5.50% 8/1/2019 (4) 2,000 2,310
Puerto Rico Public Buildings Auth. Govt. Fac. Rev. 5.50% 7/1/2014 5,000 5,768
Puerto Rico Public Buildings Auth. Govt. Fac. Rev. 5.50% 7/1/2015 4,150 4,789
Puerto Rico Public Buildings Auth. Govt. Fac. Rev. 5.50% 7/1/2016 3,000 3,455
Puerto Rico Public Buildings Auth. Govt. Fac. Rev. 5.75% 7/1/2017 2,000 2,357
- --------------------------------------------------------------------------------------------------------------------------
TOTAL MUNICIPAL BONDS (Cost $1,453,821) $ 1,615,759
- --------------------------------------------------------------------------------------------------------------------------
OTHER ASSETS AND LIABILITIES (0.1%)
- --------------------------------------------------------------------------------------------------------------------------
Other Assets--Note B 26,655
Liabilities (25,566)
-------------
$ 1,089
-------------
- --------------------------------------------------------------------------------------------------------------------------
NET ASSETS (100%) $ 1,616,848
==========================================================================================================================
* See Note A in Notes to Financial Statements.
* Securities purchased on a when-issued or delayed delivery basis for which the
fund has not taken delivery as of May 31, 2003. For key to abbreviations and
other references, see page 26.
25
- --------------------------------------------------------------------------------
AMOUNT
NEW JERSEY LONG-TERM TAX-EXEMPT FUND (000)
- --------------------------------------------------------------------------------
AT MAY 31, 2003, NET ASSETS CONSISTED OF:
- --------------------------------------------------------------------------------
Paid-in Capital $ 1,450,275
Undistributed Net Investment Income --
Accumulated Net Realized Gains 4,635
Unrealized Appreciation 161,938
- --------------------------------------------------------------------------------
NET ASSETS $ 1,616,848
================================================================================
Investor Shares--Net Assets
Applicable to 78,942,265 outstanding $.001 par value shares of
beneficial interest (unlimited authorization) $ 994,638
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--INVESTOR SHARES $ 12.60
- --------------------------------------------------------------------------------
Admiral Shares--Net Assets
Applicable to 49,383,431 outstanding $.001 par value shares of
beneficial interest (unlimited authorization) $ 622,210
- --------------------------------------------------------------------------------
NET ASSET VALUE PER SHARE--ADMIRAL SHARES $ 12.60
================================================================================
See Note C in Notes to Financial Statements for the tax-basis components of net
assets.
KEY TO ABBREVIATIONS
BAN--Bond Anticipation Note.
COP--Certificate of Participation.
CP--Commercial Paper.
GO--General Obligation Bond.
PCR--Pollution Control Revenue Bond.
PUT--Put Option Obligation.
TOB--Tender Option Bond.
TRAN--Tax Revenue Anticipation Note.
VRDO--Variable Rate Demand Obligation.
(ETM)--Escrowed to Maturity.
(Prere.)--Prerefunded.
SCHEDULED PRINCIPAL AND INTEREST PAYMENTS ARE GUARANTEED BY:
(1) MBIA (Municipal Bond Insurance Association).
(2) AMBAC (Ambac Assurance Corporation).
(3) FGIC (Financial Guaranty Insurance Company).
(4) FSA (Financial Security Assurance).
(5) BIGI (Bond Investors Guaranty Insurance). (6) XL Capital Assurance Inc.
The insurance does not guarantee the market value of the municipal bonds.
LOC--Scheduled principal and interest payments are guaranteed by bank letter of
credit.
26
STATEMENT OF OPERATIONS
This Statement shows interest income earned by each fund during the reporting
period, and details the operating expenses charged to each class of its shares.
These expenses directly reduce the amount of investment income available to pay
to shareholders as tax-exempt income dividends. This Statement also shows any
Net Gain (Loss) realized on the sale of investments, and the increase or
decrease in the Unrealized Appreciation (Depreciation) of investments during the
period. For money market funds, Realized Net Gain (Loss) should always be
minimal, and Unrealized Appreciation (Depreciation) should be zero.
- --------------------------------------------------------------------------------
NEW JERSEY TAX-EXEMPT NEW JERSEY LONG-TERM
MONEY MARKET FUND TAX-EXEMPT FUND
------------------------ --------------------
SIX MONTHS ENDED MAY 31, 2003
------------------------------------------------
(000) (000)
- --------------------------------------------------------------------------------
INVESTMENT INCOME
INCOME
Interest $10,218 $ 37,123
- --------------------------------------------------------------------------------
Total Income 10,218 37,123
- --------------------------------------------------------------------------------
EXPENSES
The Vanguard Group--Note B
Investment Advisory Services 122 107
Management and Administrative
Investor Shares 1,142 660
Admiral Shares -- 239
Marketing and Distribution
Investor Shares 171 70
Admiral Shares -- 35
Custodian Fees 3 8
Shareholders' Reports and Proxies
Investor Shares 11 11
Admiral Shares -- 5
Trustees' Fees and Expenses 1 1
Total Expenses 1,450 1,136
NET INVESTMENT INCOME 8,768 35,987
- --------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS)
Investment Securities Sold 146 5,628
Futures Contracts -- (133)
- --------------------------------------------------------------------------------
REALIZED NET GAIN (LOSS) 146 5,495
- --------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION)
Investment Securities -- 69,556
Futures Contracts -- (54)
- --------------------------------------------------------------------------------
CHANGE IN UNREALIZED APPRECIATION
(DEPRECIATION) -- 69,502
- --------------------------------------------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS
RESULTING FROM OPERATIONS $ 8,914 $110,984
================================================================================
27
STATEMENT OF CHANGES IN NET ASSETS
This Statement shows how each fund's total net assets changed during the two
most recent reporting periods. The Operations section summarizes information
detailed in the Statement of Operations. Because the fund distributes its income
to shareholders each day, the amounts of Distributions--Net Investment Income
generally equal the net income earned as shown under the Operations section. The
amounts of Distributions--Realized Capital Gain may not match the capital gains
shown in the Operations section, because distributions are determined on a tax
basis and may be made in a period different from the one in which the gains were
realized on the financial statements. The Capital Share Transactions section
shows the net amount shareholders invested in or redeemed from the fund.
Distributions and Capital Share Transactions are shown separately for each class
of shares.
- --------------------------------------------------------------------------------
NEW JERSEY TAX-EXEMPT NEW JERSEY LONG-TERM
MONEY MARKET FUND TAX-EXEMPT FUND
----------------------------- ---------------------------
SIX MONTHS YEAR SIX MONTHS YEAR
ENDED ENDED ENDED ENDED
MAY 31, 2003 NOV. 30, 2002 MAY 31, 2003 NOV. 30, 2002
(000) (000) (000) (000)
- --------------------------------------------------------------------------------
INCREASE (DECREASE) IN NET ASSETS
OPERATIONS
Net Investment Income $ 8,768 $ 21,282 $ 35,987 $ 72,103
Realized Net Gain (Loss) 146 300 5,495 6,883
Change in Unrealized
Appreciation (Depreciation) -- -- 69,502 14,455
- --------------------------------------------------------------------------------
Net Increase (Decrease) in
Net Assets Resulting from
Operations 8,914 21,582 110,984 93,441
- --------------------------------------------------------------------------------
DISTRIBUTIONS
Net Investment Income
Investor Shares (8,768) (21,282) (22,007) (45,566)
Admiral Shares -- -- (13,980) (26,537)
Realized Capital Gain*
Investor Shares -- -- (3,754) (1,885)
Admiral Shares -- -- (2,337) (954)
- --------------------------------------------------------------------------------
Total Distributions (8,768) (21,282) (42,078) (74,942)
- --------------------------------------------------------------------------------
Capital Share Transactions--
Note E
Investor Shares 76,517 208,279 (5,365) (7,311)
Admiral Shares -- -- (1,343) 113,510
- --------------------------------------------------------------------------------
Net Increase (Decrease)from
Capital Share Transactions 76,517 208,279 (6,708) 106,199
- --------------------------------------------------------------------------------
Total Increase (Decrease) 76,663 208,579 62,198 124,698
- --------------------------------------------------------------------------------
NET ASSETS
Beginning of Period 1,757,531 1,548,952 1,554,650 1,429,952
- --------------------------------------------------------------------------------
End of Period $1,834,194 $1,757,531 $1,616,848 $1,554,650
================================================================================
* Includes fiscal 2003 and 2002 short-term gain distributions by the Long-Term
Tax-Exempt Fund totaling $0 and $321,000, respectively. Short-term gain
distributions are treated as ordinary income dividends for tax purposes.
28
FINANCIAL HIGHLIGHTS
This table summarizes each fund's investment results and distributions to
shareholders on a per-share basis for each class of shares. It also presents the
Total Return and shows net investment income and expenses as percentages of
average net assets. These data will help you assess: the variability of the
fund's net income and total returns from year to year; the relative
contributions of net income and capital gains to the fund's total return; how
much it costs to operate the fund; and the extent to which the fund tends to
distribute capital gains. The table also shows the Portfolio Turnover Rate, a
measure of trading activity. A turnover rate of 100% means that the average
security is held in the fund for one year. Money market funds are not required
to report a Portfolio Turnover Rate.
NEW JERSEY TAX-EXEMPT MONEY MARKET FUND
- --------------------------------------------------------------------------------------------------------------------
YEAR ENDED NOVEMBER 30,
SIX MONTHS ENDED -------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD MAY 31, 2003 2002 2001 2000 1999 1998
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
- --------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .005 .013 .028 .036 .028 .031
Net Realized and Unrealized Gain (Loss) on Investments -- -- -- -- -- --
- --------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .005 .013 .028 .036 .028 .031
- --------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.005) (.013) (.028) (.036) (.028) (.031)
Distributions from Realized Capital Gains -- -- -- -- -- --
- --------------------------------------------------------------------------------------------------------------------
Total Distributions (.005) (.013) (.028) (.036) (.028) (.031)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
====================================================================================================================
TOTAL RETURN 0.49% 1.29% 2.80% 3.68% 2.86% 3.18%
====================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $1,834 $1,758 $1,549 $1,427 $1,263 $1,179
Ratio of Total Expenses to Average Net Assets 0.16%* 0.17% 0.18% 0.18% 0.20% 0.20%
Ratio of Net Investment Income to Average Net Assets 0.98%* 1.28% 2.74% 3.62% 2.82% 3.12%
====================================================================================================================
*Annualized.
29
FINANCIAL HIGHLIGHTS (CONTINUED)
NEW JERSEY LONG-TERM TAX-EXEMPT FUND INVESTOR SHARES
- --------------------------------------------------------------------------------------------------------------------
YEAR ENDED NOVEMBER 30,
SIX MONTHS ENDED -------------------------------------------------
FOR A SHARE OUTSTANDING THROUGHOUT EACH PERIOD MAY 31, 2003 2002 2001 2000 1999 1998
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $12.06 $11.91 $11.52 $11.19 $11.98 $11.72
- --------------------------------------------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .279 .575 .581 .599 .590 .599
Net Realized and Unrealized Gain (Loss) on Investments .587 .174 .390 .330 (.738) .271
- --------------------------------------------------------------------------------------------------------------------
Total from Investment Operations .866 .749 .971 .929 (.148) .870
- --------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.279) (.575) (.581) (.599) (.590) (.599)
Distributions from Realized Capital Gains (.047) (.024) -- -- (.052) (.011)
- --------------------------------------------------------------------------------------------------------------------
Total Distributions (.326) (.599) (.581) (.599) (.642) (.610)
- --------------------------------------------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $12.60 $12.06 $11.91 $11.52 $11.19 $11.98
====================================================================================================================
TOTAL RETURN 7.27% 6.42% 8.55% 8.57% -1.31% 7.59%
====================================================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $995 $958 $954 $1,235 $1,155 $1,112
Ratio of Total Expenses to Average Net Assets 0.17%* 0.18% 0.20% 0.19% 0.19% 0.20%
Ratio of Net Investment Income to Average Net Assets 4.55%* 4.78% 4.89% 5.33% 5.06% 5.04%
Portfolio Turnover Rate 14%* 15% 8% 14% 11% 14%
====================================================================================================================
*Annualized.
NEW JERSEY LONG-TERM TAX-EXEMPT FUND ADMIRAL SHARES
- --------------------------------------------------------------------------------
SIX MONTHS YEAR
ENDED ENDED MAY 14* TO
FOR A SHARE OUTSTANDING MAY 31, NOV. 30, NOV. 30,
THROUGHOUT EACH PERIOD 2003 2002 2001
- --------------------------------------------------------------------------------
NET ASSET VALUE, BEGINNING OF PERIOD $12.06 $11.91 $11.76
- --------------------------------------------------------------------------------
INVESTMENT OPERATIONS
Net Investment Income .282 .582 .318
Net Realized and Unrealized Gain
(Loss) on Investments .587 .174 .150
- --------------------------------------------------------------------------------
Total from Investment Operations .869 .756 .468
- --------------------------------------------------------------------------------
DISTRIBUTIONS
Dividends from Net Investment Income (.282) (.582) (.318)
Distributions from Realized Capital Gains (.047) (.024) --
- --------------------------------------------------------------------------------
Total Distributions (.329) (.606) (.318)
- --------------------------------------------------------------------------------
NET ASSET VALUE, END OF PERIOD $12.60 $12.06 $11.91
================================================================================
TOTAL RETURN 7.31% 6.48% 4.00%
================================================================================
RATIOS/SUPPLEMENTAL DATA
Net Assets, End of Period (Millions) $622 $597 $476
Ratio of Total Expenses to
Average Net Assets 0.11%** 0.12% 0.15%**
Ratio of Net Investment Income to
Average Net Assets 4.61%** 4.82% 4.84%**
Portfolio Turnover Rate 14%** 15% 8%
================================================================================
*Inception.
**Annualized.
30
NOTES TO FINANCIAL STATEMENTS
Vanguard New Jersey Tax-Exempt Funds comprise the New Jersey Tax-Exempt Money
Market Fund and the New Jersey Long-Term Tax-Exempt Fund, each of which is
registered under the Investment Company Act of 1940 as an open-end investment
company, or mutual fund. Each fund invests in debt instruments of municipal
issuers whose ability to meet their obligations may be affected by economic and
political developments in the state of New Jersey.
The Long-Term Tax-Exempt Fund offers two classes of shares, Investor Shares
and Admiral Shares. Investor Shares are available to any investor who meets the
fund's minimum purchase requirements. Admiral Shares are designed for investors
who meet certain administrative, servicing, tenure, and account-size criteria.
The Tax-Exempt Money Market Fund offers only Investor Shares. A. The following
significant accounting policies conform to generally accepted accounting
principles for U.S. mutual funds. The funds consistently follow such policies in
preparing their financial statements.
1. SECURITY VALUATION: Tax-Exempt Money Market Fund: Investment securities
are valued at amortized cost, which approximates market value. Long-Term
Tax-Exempt Fund: Bonds, and temporary cash investments acquired over 60 days to
maturity, are valued using the latest bid prices or using valuations based on a
matrix system (which considers such factors as security prices, yields,
maturities, and ratings), both as furnished by independent pricing services.
Other temporary cash investments are valued at amortized cost, which
approximates market value. Securities for which market quotations are not
readily available, or whose values have been materially affected by events
occurring before the funds' pricing time but after the close of the securities'
primary markets, are valued by methods deemed by the board of trustees to
represent fair value.
2. FUTURES CONTRACTS: The Long-Term Tax-Exempt Fund may use Municipal Bond
Index, U.S. Treasury Bond, and U.S. Treasury Note futures contracts, with the
objectives of enhancing returns, managing interest rate risk, maintaining
liquidity, diversifying credit risk, and minimizing transaction costs. The fund
may purchase or sell futures contracts instead of bonds to take advantage of
pricing differentials between the futures contracts and the underlying bonds.
The fund may also seek to take advantage of price differences among bond market
sectors by simultaneously buying futures (or bonds) of one market sector and
selling futures (or bonds) of another sector. Futures contracts may also be used
to simulate a fully invested position in the underlying bonds while maintaining
a cash balance for liquidity. The primary risks associated with the use of
futures contracts are imperfect correlation between changes in market values of
bonds held by the fund and the prices of futures contracts, and the possibility
of an illiquid market.
Futures contracts are valued based upon their quoted daily settlement
prices. The aggregate principal amounts of the contracts are not recorded in the
financial statements. Fluctuations in the value of the contracts are recorded in
the Statement of Net Assets as an asset (liability) and in the Statement of
Operations as unrealized appreciation (depreciation) until the contracts are
closed, when they are recorded as realized futures gains (losses).
3. Federal Income Taxes: Each fund intends to continue to qualify as a
regulated investment company and distribute all of its income. Accordingly, no
provision for federal income taxes is required in the financial statements.
4. Distributions: Dividends from net investment income are declared daily
and paid on the first business day of the following month. Annual distributions
from realized capital gains, if any, are recorded on the ex-dividend date.
5. Other: Security transactions are accounted for on the date securities
are bought or sold. Costs used to determine realized gains (losses) on the sale
of investment securities are those of the specific securities sold. Premiums and
discounts are amortized and accreted, respectively, to interest income over the
lives of the respective securities.
31
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
Each class of shares has equal rights as to assets and earnings, except
that each class separately bears certain class-specific expenses related to
maintenance of shareholder accounts (included in Management and Administrative
expenses), shareholder reporting, and proxies. Marketing and distribution
expenses are allocated to each class of shares based on a method approved by the
board of trustees. Income, other non-class-specific expenses, and gains and
losses on investments are allocated to each class of shares based on its
relative net assets.
B. The Vanguard Group furnishes at cost investment advisory, corporate
management, administrative, marketing, and distribution services. The costs of
such services are allocated to each fund under methods approved by the board of
trustees. Each fund has committed to provide up to 0.40% of its net assets in
capital contributions to Vanguard. At May 31, 2003, the funds had contributed
capital to Vanguard (included in Other Assets) of:
- --------------------------------------------------------------------------------
CAPITAL CONTRIBUTION PERCENTAGE PERCENTAGE OF
TO VANGUARD OF FUND VANGUARD'S
NEW JERSEY TAX-EXEMPT FUND (000) NET ASSETS CAPITALIZATION
- --------------------------------------------------------------------------------
Money Market $330 0.02% 0.33%
Long-Term 287 0.02 0.29
- --------------------------------------------------------------------------------
The funds' trustees and officers are also directors and officers of Vanguard.
C. Capital gain distributions are determined on a tax basis and may differ from
realized capital gains for financial reporting purposes. Differences may be
permanent or temporary. Permanent differences are reclassified among capital
accounts in the financial statements to reflect their tax character. Temporary
differences arise when gains or losses are recognized in different periods for
financial statement and tax purposes; these differences will reverse at some
time in the future. The funds' tax-basis capital gains and losses are determined
only at the end of each fiscal year.
The Long-Term Tax-Exempt Fund had realized losses totaling $800,000 through
November 30, 2002, which are deferred for tax purposes and reduce the amount of
unrealized appreciation on investment securities for tax purposes.
At May 31, 2003, net unrealized appreciation of Long-Term Tax-Exempt Fund
investment securities for tax purposes was $161,138,000, consisting entirely of
unrealized gains on securities that had risen in value since their purchase. D.
During the six months ended May 31, 2003, the Long-Term Tax-Exempt Fund
purchased $103,819,000 of investment securities and sold $138,091,000 of
investment securities, other than temporary cash investments.
32
E. Capital share transactions for each class of shares were:
- --------------------------------------------------------------------------------
SIX MONTHS ENDED YEAR ENDED
MAY 31, 2003 NOVEMBER 30, 2002
---------------------- ----------------------
AMOUNT SHARES AMOUNT SHARES
NEW JERSEY TAX-EXEMPT FUND (000) (000) (000) (000)
- --------------------------------------------------------------------------------
MONEY MARKET
Issued $ 682,452 682,452 $ 1,363,789 1,363,789
Issued in Lieu of Cash
Distributions 8,482 8,482 20,389 20,389
Redeemed (614,417)(614,417) (1,175,899) (1,175,899)
- --------------------------------------------------------------------------------
Net Increase (Decrease) 76,517 76,517 208,279 208,279
- --------------------------------------------------------------------------------
LONG-TERM
INVESTOR SHARES
Issued $ 95,972 7,820 $ 232,695 19,338
Issued in Lieu of Cash
Distributions 19,614 1,593 35,624 2,965
Redeemed (120,951) (9,866) (275,630) (22,986)
- --------------------------------------------------------------------------------
Net Increase (Decrease)--
Investor Shares (5,365) (453) (7,311) (683)
- --------------------------------------------------------------------------------
Admiral Shares
Issued 60,013 4,888 221,274 18,475
Issued in Lieu of Cash
Distributions 12,370 1,005 20,579 1,710
Redeemed (73,726) (6,005) (128,343) (10,673)
- --------------------------------------------------------------------------------
Net Increase (Decrease)--
Admiral Shares (1,343) (112) 113,510 9,512
================================================================================
33
Investing Is Fast and Easy on Vanguard.com
If you're like many Vanguard investors, you believe in planning and taking
control of your own investments. Vanguard.com(R) was built for you--and it's
getting better all the time.
MANAGE YOUR INVESTMENTS WITH EASE
Log on to Vanguard.com and:
* See what you own (at Vanguard and elsewhere) and how you're doing by using
our Consolidated View(TM) tool.
* Check your overall asset allocation, no matter where your assets are held.
* Compare your holdings with industry benchmarks.
* Analyze your personal performance.
* Invest online and even manage the mail you get from us. (Prefer to get fund
reports like this one online? Just let us know!)
* Set up a Watch List to make it easy to track funds and securities of
interest.
PLAN YOUR INVESTMENTS WITH CONFIDENCE
Go to our PLANNING & Advice and RESEARCH FUNDS & STOCKS sections and:
* Take our Investor Questionnaire to find out what asset allocation might
best suit your needs.
* Find out how much you should save for retirement and for college costs.
* Discover how investment costs affect your bottom line by using our Compare
Fund Costs tool.
* Find out how to maximize your after-tax returns in our PlainTalk(R) guide
Be a Tax-Savvy Investor.
* Attend our quarterly PlainTalk webcasts on investing.
Find out what Vanguard.com can do for you. Log on today!
34
Capitalize on Your IRA
Are you taking full advantage of your individual retirement account? You really
should be. The contribution limits on IRAs were recently raised, making these
tax-deferred accounts more powerful options for retirement savers.
Here's how you can exploit your IRA--and improve your chances of having the
retirement of your dreams.
* CONTRIBUTE THE MAXIMUM AMOUNT EACH YEAR.
It may be an obvious point, but if you invest as much in your IRA as the law
allows--currently $3,000 per tax year if you are under age 50 and $3,500 if you
are age 50 or over--you will increase the odds of meeting your retirement goals.
"Max out" every year you can.
* MAKE IT AUTOMATIC.
Put your IRA on autopilot by taking advantage of Vanguard's Automatic Investment
Plan. Your IRA contributions will be deducted from your bank account on a
schedule of your choosing, making retirement investing a healthy habit.
* CONSIDER COST.
The owners of low-cost investments keep a larger portion of their gross returns
than the owners of high-cost investments. Over the long term, avoiding costlier
mutual funds and brokerage commissions could significantly boost your retirement
savings. Our low costs are one reason a Vanguard IRA(R) is such a smart choice.
* Request a direct rollover when you change jobs.
Don't spend your retirement assets before you've retired. When you change jobs,
roll your 401(k) or other employer-sponsored retirement plan assets directly
into your IRA.
If you have questions about your IRA, want to transfer an IRA from another
institution to Vanguard, or need help with any other IRA transaction, call our
Retirement Resource Center at 1-800-205-6189 or visit Vanguard.com. You can open
or fund your IRA on our website, and have a confirmation in your hand within
minutes.
THE VANGUARD(R) FAMILY OF FUNDS
STOCK FUNDS
500 Index Fund
Calvert Social Index Fund
Capital Opportunity Fund
Capital Value Fund
Convertible Securities Fund
Developed Markets Index Fund
Dividend Growth Fund
Emerging Markets Stock Index Fund
Energy Fund
Equity Income Fund
European Stock Index Fund
Explorer(TM) Fund
Extended Market Index Fund
Global Equity Fund
Growth and Income Fund
Growth Equity Fund
Growth Index Fund
Health Care Fund
Institutional Developed Markets Index Fund
Institutional Index Fund
Institutional Total Stock Market Index Fund
International Explorer(TM) Fund
International Growth Fund
International Value Fund
Mid-Cap Growth Fund
Mid-Cap Index Fund
Morgan(TM) Growth Fund
Pacific Stock Index Fund
Precious Metals Fund
PRIMECAP Fund
REIT Index Fund
Selected Value Fund
Small-Cap Growth Index Fund
Small-Cap Index Fund
Small-Cap Value Index Fund
Strategic Equity Fund
Tax-Managed Capital Appreciation Fund
Tax-Managed Growth and Income Fund
Tax-Managed International Fund
Tax-Managed Small-Cap Fund
Total International Stock Index Fund
Total Stock Market Index Fund
U.S. Growth Fund
U.S. Value Fund
Value Index Fund
Windsor(TM) Fund
Windsor(TM) II Fund
BALANCED FUNDS
Asset Allocation Fund
Balanced Index Fund
LifeStrategy(R) Conservative Growth Fund
LifeStrategy(R) Growth Fund
LifeStrategy(R) Income Fund
LifeStrategy(R) Moderate Growth Fund
STAR(TM) Fund
Tax-Managed Balanced Fund
Wellesley(R) Income Fund
Wellington(TM) Fund
BOND FUNDS
GNMA Fund
High-Yield Corporate Fund
High-Yield Tax-Exempt Fund
Inflation-Protected Securities Fund
Institutional Total Bond Market Index Fund
Insured Long-Term Tax-Exempt Fund
Intermediate-Term Bond Index Fund
Intermediate-Term Corporate Fund
Intermediate-Term Tax-Exempt Fund
Intermediate-Term Treasury Fund
Limited-Term Tax-Exempt Fund
Long-Term Bond Index Fund
Long-Term Corporate Fund
Long-Term Tax-Exempt Fund
Long-Term Treasury Fund
Short-Term Bond Index Fund
Short-Term Corporate Fund
Short-Term Federal Fund
Short-Term Tax-Exempt Fund
Short-Term Treasury Fund
State Tax-Exempt Bond Funds
(California, Florida, Massachusetts,
New Jersey, New York, Ohio, Pennsylvania)
Total Bond Market Index Fund
MONEY MARKET FUNDS
Admiral(TM) Treasury Money Market Fund
Federal Money Market Fund
Prime Money Market Fund
State Tax-Exempt Money Market
Funds (California,
New Jersey, New York, Ohio, Pennsylvania)
Tax-Exempt Money Market Fund
Treasury Money Market Fund
VARIABLE ANNUITY
Balanced Portfolio
Capital Growth Portfolio
Diversified Value Portfolio
Equity Income Portfolio
Equity Index Portfolio
Growth Portfolio
High Yield Bond Portfolio
International Portfolio
Mid-Cap Index Portfolio
Money Market Portfolio
REIT Index Portfolio
Short-Term Corporate Portfolio
Small Company Growth Portfolio
Total Bond Market Index Portfolio
Total Stock Market Index Portfolio
For information about Vanguard funds and annuities, including charges and
expenses, obtain a prospectus from The Vanguard Group, P.O. Box 2600, Valley
Forge, PA 19482-2600. Read it carefully before you invest or send money.
THE PEOPLE WHO GOVERN YOUR FUND
The trustees of your mutual fund are there to see that the fund is operated and
managed in your best interests since, as a shareholder, you are a part owner of
the fund. Your fund trustees also serve on the board of directors of The
Vanguard Group, Inc., which is owned by the Vanguard(R) funds and provides
services to them on an at-cost basis.
A majority of Vanguard's board members are independent, meaning that they
have no affiliation with Vanguard or the funds they oversee, apart from the
investments they have made as private individuals. Our independent board members
bring distinguished backgrounds in business, academia, and public service to
their task of working with Vanguard officers to establish the policies and
oversee the activities of the funds.
Among board members' responsibilities are selecting investment advisers for
the funds; monitoring fund operations, performance, and costs; reviewing
contracts; nominating and selecting new trustees/directors; and electing
Vanguard officers. The dates in parentheses below show when each trustee was
initially elected.
- --------------------------------------------------------------------------------
JOHN J. BRENNAN* Chairman of the Board, Chief Executive Officer, and
(1987) Director/Trustee of The Vanguard Group, Inc., and
of each of the investment companies served by The
Vanguard Group.
- --------------------------------------------------------------------------------
INDEPENDENT TRUSTEES
CHARLES D. ELLIS The Partners of '63 (pro bono ventures in education);
(2001) Senior Adviser to Greenwich Associates (international
business strategy consulting); Successor Trustee of
Yale University; Overseer of the Stern School of
Business at New York University; Trustee of the
Whitehead Institute for Biomedical Research.
- --------------------------------------------------------------------------------
RAJIV L. GUPTA Chairman and Chief Executive Officer (since October
(2002) 1999), Vice Chairman (January-September 1999), and
Vice President (prior to September1999) of Rohm and
Haas Co. (chemicals); Director of Technitrol, Inc.
(electroniccomponents), and Agere Systems
(communications components); Board Member of the
American Chemistry Council; Trustee of Drexel
University.
- --------------------------------------------------------------------------------
JOANN HEFFERNAN HEISEN Vice President, Chief Information Officer, and Member
(1998) of the Executive Committee of Johnson & Johnson
(pharmaceuticals/consumer products); Director of the
Medical Center at Princeton and Women's Research and
Education Institute.
- --------------------------------------------------------------------------------
BURTON G. MALKIEL Chemical Bank Chairman's Professor of Economics,
(1977) Princeton University; Director of Vanguard Investment
Series plc (Irish investment fund) (since November
2001), Vanguard Group (Ireland) Limited (Irish
investment management firm) (since November 2001),
Prudential Insurance Co. of America, BKF Capital
(investment management firm), The Jeffrey Co.(holding
company), and NeuVis, Inc.(software company).
- --------------------------------------------------------------------------------
ALFRED M. RANKIN, JR. Chairman, President, Chief Executive Officer, and
(1993) Director of NACCO Industries, Inc. (forklift trucks/
housewares/lignite); Director of Goodrich Corporation
(industrial products/aircraft systems and services);
Director until 1998 of Standard Products Company (a
supplier for the automotive industry).
- --------------------------------------------------------------------------------
J. LAWRENCE WILSON Retired Chairman and Chief Executive Officer of Rohm
(1985) and Haas Co. (chemicals); Director of Cummins Inc.
(diesel engines), MeadWestvaco Corp.(paper products),
and AmerisourceBergen Corp. (pharmaceutical
distribution); Trustee of Vanderbilt University.
- --------------------------------------------------------------------------------
EXECUTIVE OFFICERS*
R. Gregory Barton Secretary; Managing Director and General Counsel of
The Vanguard Group, Inc. (since September 1997);
Secretary of The Vanguard Group and of each of the
investment companies served by The Vanguard Group;
Principal of The Vanguard Group (prior to September
1997).
- --------------------------------------------------------------------------------
THOMAS J. HIGGINS Treasurer; Principal of The Vanguard Group, Inc.;
Treasurer of each of the investment companies served
by The Vanguard Group.
- --------------------------------------------------------------------------------
* Officers of the funds are "interested persons" as defined in the Investment
Company Act of 1940.
More information about the trustees is in the Statement of Additional
Information, available from The Vanguard Group.
- --------------------------------------------------------------------------------
VANGUARD SENIOR MANAGEMENT TEAM
MORTIMER J. BUCKLEY, Information Technology.
F. WILLIAM MCNABB, III, Client Relationship Group.
JAMES H. GATELY, Investment Programs and Services.
MICHAEL S. MILLER, Planning and Development.
KATHLEEN C. GUBANICH, Human Resources.
RALPH K. PACKARD, Finance.
IAN A. MACKINNON, Fixed Income Group.
GEORGE U. SAUTER, Quantitative Equity Group.
- --------------------------------------------------------------------------------
JOHN C. BOGLE, Founder; Chairman and Chief Executive Officer, 1974-1996.
[PICTURE OF SHIP]
THE VANGUARD GROUP(R)
POST OFFICE BOX 2600
Valley Forge, PA 19482-2600
Vanguard, The Vanguard Group, Vanguard.com, Admiral, Consolidated View,
Explorer, Morgan, LifeStrategy, PlainTalk, STAR, Wellesley, Wellington, Windsor,
Vanguard IRA, and the ship logo are trademarks of The Vanguard Group, Inc.
S&P 500(R), Standard & Poor's 500, and 500 are trademarks of The McGraw-Hill
Companies, Inc., and have been licensed for use by The Vanguard Group, Inc.
Vanguard mutual funds are not sponsored, endorsed, sold, or promoted by Standard
& Poor's, and Standard & Poor's makes no representation regarding the
advisability of investing in the funds.
Calvert Social Index is a trademark of Calvert Group, Ltd., and has been
licensed for use by The Vanguard Group, Inc. Vanguard Calvert Social Index Fund
is not sponsored, endorsed, sold, or promoted by Calvert Group, Ltd., and
Calvert Group, Ltd., makes no representation regarding the advisability of
investing in the fund.
All other marks are the exclusive property of their respective owners.
ABOUT OUR COVER
The photographs of the sails and ship that appear on the cover of this report
are copyrighted by Michael Kahn.
FOR MORE INFORMATION
This report is intended for the funds' shareholders. It may not be distributed
to prospective investors unless it is preceded or accompanied by the current
fund prospectus.
To receive a free copy of the prospectus or the Statement of Additional
Information, or to request additional information about the funds or other
Vanguard funds, please contact us at one of the adjacent telephone numbers or by
e-mail through VANGUARD.COM(R). Prospectuses may also be viewed online.
All comparative mutual fund data are from Lipper Inc. or Morningstar, Inc.,
unless otherwise noted.
WORLD WIDE WEB
www.vanguard.com
FUND INFORMATION
1-800-662-7447
DIRECT INVESTOR ACCOUNT SERVICES
1-800-662-2739
INSTITUTIONAL INVESTOR SERVICES
1-800-523-1036
TEXT TELEPHONE
1-800-952-3335
(C) 2003 THE VANGUARD GROUP, INC.
ALL RIGHTS RESERVED.
VANGUARD MARKETING
CORPORATION, DISTRIBUTOR.
Q142 072003
Item 2: Code(s) of Ethics for senior financial officers - Item not applicable to
semi-annual report.
Item 3: Audit Committee Financial Expert - Item not applicable to semi-annual
report.
Item 4: Principal Accountant Fees and Services - Item not applicable to
semi-annual report.
Item 5: Not Applicable.
Item 6: Reserved.
Item 7: Not applicable.
Item 8: Reserved.
Item 9: Controls and Procedures.
(a) Disclosure Controls and Procedures. The Principal Executive and
Financial Officers concluded that the Registrant's Disclosure Controls and
Procedures are effective based on their evaluation of the Disclosure Controls
and Procedures as of a date within 90 days of the filing date of this report.
(b) Internal Controls. There were no significant changes in Registrant's
internal controls or in other factors that could significantly affect these
controls subsequent to the date of their evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Item 10: Exhibits attached hereto. (Attach certifications as exhibits)
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.
VANGUARD NEW JERSEY TAX-FREE FUNDS
BY: (signature)
----------------------------------------
(HEIDI STAM)
JOHN J. BRENNAN*
CHIEF EXECUTIVE OFFICER
Date: July 8, 2003
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.
VANGUARD NEW JERSEY TAX-FREE FUNDS
BY: (signature)
----------------------------------------
(HEIDI STAM)
JOHN J. BRENNAN*
CHIEF EXECUTIVE OFFICER
Date: : July 8, 2003
VANGUARD NEW JERSEY TAX-FREE FUNDS
BY: (signature)
----------------------------------------
(HEIDI STAM)
THOMAS J. HIGGINS*
TREASURER
Date: : July 8, 2003
*By Power of Attorney. See File Number 2-57689, filed on December 26, 2002.
Incorporated by Reference.
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Name of Issuer: VANGUARD NEW JERSEY TAX-FREE FUNDS
In connection with the Report on Form N-CSR of the above-named issuer that
is accompanied by this certification, the undersigned hereby certifies, to his
knowledge, that:
1. The Report fully complies with the requirements of Section 13(a) or 15 (d)
of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all materials
respects, the financial condition and results of operations of the issuer.
Date: July 8, 2003 /s/ John J. Brennan
-----------------------
John J. Brennan
Chief Executive Officer
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Name of Issuer: VANGUARD NEW JERSEY TAX-FREE FUNDS
In connection with the Report on Form N-CSR of the above-named issuer is
accompanied by this certification, the undersigned hereby certifies, to his
knowledge, that:
1. The Report fully complies with the requirements of Section 13(a) or 15 (d)
of the Securities Exchange Act of 1934; and
2. The information contained in the Report fairly presents, in all materials
respects, the financial condition and results of operations of the issuer.
Date: July 8, 2003 /s/ Thomas J. Higgins
-----------------------
Thomas J. Higgins
Treasurer
CERTIFICATIONS
--------------
I, John J. Brennan, certify that:
1. I have reviewed this report on Form N-CSR of Vanguard New Jersey Tax-Free
Funds;
2. Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations, changes in net assets, and cash
flows (if the financial statements are required to include a statement of cash
flows) of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Rule 30a-2(c) under the Investment Company Act of 1940) for the registrant and
have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this report
(the "Evaluation Date"); and
c) presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures based on our evaluation as of the Evaluation
Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
the registrant's board of directors (or persons performing the equivalent
functions):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize, and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
report whether or not there were significant changes in internal controls or in
other factors that could significantly affect internal controls subsequent to
the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
Date: July 8, 2003
/s/ John J. Brennan
----------------------
CHIEF EXECUTIVE OFFICER
CERTIFICATIONS
--------------
I, Thomas J. Higgins, certify that:
1. I have reviewed this report on Form N-CSR of Vanguard New Jersey Tax-Free
Funds;
2. Based on my knowledge, this report does not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
made, in light of the circumstances under which such statements were made, not
misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial
information included in this report, fairly present in all material respects the
financial condition, results of operations, changes in net assets, and cash
flows (if the financial statements are required to include a statement of cash
flows) of the registrant as of, and for, the periods presented in this report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Rule 30a-2(c) under the Investment Company Act of 1940) for the registrant and
have:
a) designed such disclosure controls and procedures to ensure that material
information relating to the registrant, including its consolidated subsidiaries,
is made known to us by others within those entities, particularly during the
period in which this report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls and
procedures as of a date within 90 days prior to the filing date of this report
(the "Evaluation Date"); and
c) presented in this report our conclusions about the effectiveness of the
disclosure controls and procedures based on our evaluation as of the Evaluation
Date;
5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation, to the registrant's auditors and the audit committee of
the registrant's board of directors (or persons performing the equivalent
functions):
a) all significant deficiencies in the design or operation of internal controls
which could adversely affect the registrant's ability to record, process,
summarize, and report financial data and have identified for the registrant's
auditors any material weaknesses in internal controls; and
b) any fraud, whether or not material, that involves management or other
employees who have a significant role in the registrant's internal controls; and
6. The registrant's other certifying officers and I have indicated in this
report whether or not there were significant changes in internal controls or in
other factors that could significantly affect internal controls subsequent to
the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.
Date: July 8, 2003
/s/ Thomas J. Higgins
-----------------
TREASURER