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: 811-4791
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND, INC.
(Exact name of registrant as specified in charter)
1345 Avenue of the Americas, New York, New York 10105
(Address of principal executive offices) (Zip code)
Mark R. Manley
Alliance Capital Management L.P.
1345 Avenue of the Americas
New York, New York 10105
(Name and address of agent for service)
Registrant's telephone number, including area code: (800) 221-5672
Date of fiscal year end: October 31, 2005
Date of reporting period: April 30, 2005
ITEM 1. REPORTS TO STOCKHOLDERS.
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SEMI-ANNUAL REPORT
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[LOGO] AllianceBernstein (R)
Investment Research and Management
AllianceBernstein Municipal Income Fund
Tax-Exempt Income
April 30, 2005
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The Fund expects to hold a meeting of shareholders on or about November 15,
2005, at which the election of directors will be considered. For information
with respect to submitting a candidate for director for consideration by the
Governance and Nominating Committee of the Fund's Board of Directors, please
see the Nominating Procedures in the Fund's Statement of Additional Information.
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Investment Products Offered
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o Are Not FDIC Insured
o May Lose Value
o Are Not Bank Guaranteed
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The investment return and principal value of an investment in the Fund will
fluctuate as the prices of the individual securities in which it invests
fluctuate, so that your shares, when redeemed, may be worth more or less than
their original cost. You should consider the investment objectives, risks,
charges and expenses of the Fund carefully before investing. For a free copy of
the Fund's prospectus, which contains this and other information, visit our web
site at www.alliancebernstein.com or call your financial advisor or
AllianceBernstein at (800) 227-4618. Please read the prospectus carefully
before you invest.
You may obtain performance information current to the most recent month-end by
visiting www.alliancebernstein.com.
This shareholder report must be preceded or accompanied by the Fund's
prospectus for individuals who are not current shareholders of the Fund.
You may obtain a description of the Fund's proxy voting policies and
procedures, and information regarding how the Fund voted proxies relating to
portfolio securities during the most recent 12-month period ended June 30,
without charge. Simply visit AllianceBernstein's web site at
www.alliancebernstein.com, or go to the Securities and Exchange Commission's
(the "Commission") web site at www.sec.gov, or call AllianceBernstein at (800)
227-4618.
The Fund files its complete schedule of portfolio holdings with the Commission
for the first and third quarters of each fiscal year on Form N-Q. The Fund's
Forms N-Q are available on the Commission's web site at www.sec.gov. The Fund's
Forms N-Q may also be reviewed and copied at the Commission's Public Reference
Room in Washington, DC; information on the operation of the Public Reference
Room may be obtained by calling (800) SEC-0330.
AllianceBernstein Investment Research and Management, Inc. is an affiliate of
Alliance Capital Management L.P., the manager of the funds, and is a member of
the NASD.
June 20, 2005
Semi-Annual Report
This report provides management's discussion of fund performance for the
portfolios of AllianceBernstein Municipal Income Fund (the "Portfolios") for
the semi-annual reporting period ended April 30, 2005.
Investment Objective and Policies
The five Portfolios of this open-end fund, by investing principally in
high-yielding, predominantly medium-quality municipal securities, seek to
provide their shareholders with the highest level of income exempt from Federal
and state personal income tax that is available without assuming undue risk.
While these securities involve higher risk than higher-quality municipal
obligations, they generally offer higher current yields.
Investment Results
The tables on pages 4-5 show performance for each Portfolio compared to its
benchmark, the Lehman Brothers (LB) Municipal Index, for the six- and 12-month
periods ended April 30, 2005.
For the six-month period ended April 30, 2005, all of the AllianceBernstein
Municipal Income Fund Portfolios' Class A shares outperformed the benchmark,
which represents the municipal bond market. A description of each Portfolio's
relative performance versus the benchmark for the six-month period ended April
30, 2005 follows.
National Portfolio--The National Portfolio's stronger relative performance was
largely the result of its relative weight in the industrial revenue bond and
hospital sectors. The Portfolio benefited from security selection in the
insured, special tax and hospital sectors. Security selection in the industrial
revenue bond sector detracted from performance.
California Portfolio--The California Portfolio's stronger relative performance
was largely the result of security selection in the special tax, pre-refunded,
general obligation and insured sectors. Security selection in the industrial
revenue bond sector detracted from performance.
New York Portfolio--The New York Portfolio's stronger relative performance was
largely the result of its relative weight in the industrial revenue bond
sector. The Portfolio also benefited from security selection in the
pre-refunded and special tax sectors. Security selection in the industrial
revenue bond sector detracted from performance.
Insured National Portfolio--The Insured National Portfolio's stronger relative
performance was largely the result of security selection in the insured sector.
Security selection in the pre-refunded sector detracted from performance. The
Portfolio's relative weight in the industrial revenue bond sector detracted
from performance.
Insured California Portfolio--The Insured California Portfolio's stronger
relative performance was largely the result of security selection in the
insured sector. The Portfolio's relative weights in the pre-refunded and
industrial revenue bond sectors benefited and detracted from performance,
respectively.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 1
Market Review and Investment Strategy
During the six-month period ended April 30, 2005, long-term municipal bond
yields declined and short-term municipal bond yields increased. Yields moved in
a similar manner in the Treasury bond market. The rise in short-term bond
yields was in response to the U.S. Federal Reserve increasing the target for
the Federal Funds rate by 1.00% through four rate hikes over the period.
Inconclusive economic signals and moderate inflation expectations, however,
allowed longer-term bond yields to decline. On a pre-tax basis, the municipal
market outperformed the taxable bond market for the six-month period ended
April 30, 2005. The LB Municipal Index gained 1.93%, versus the LB U.S.
Aggregate Index, representing taxable bonds, which returned 0.98% during the
same time frame. As of April 30, 2005, 30-year municipal bonds were yielding
approximately 97% of comparable maturity Treasury bonds.
Interest rates are still low by historical standards versus inflation and
indications of economic growth. As such, the Fund's Municipal Bond Investment
Team (the "team") continue to maintain shorter-than-benchmark portfolio
durations. The low-rate environment has led to relatively strong demand for
lower-rated bonds as investors seek higher income producing bonds. As the yield
premium on lower-rated bonds declined, making them more expensive to buy/own
versus high quality bonds, the team sold lower-rated bonds opportunistically.
Stronger economic growth has helped boost state and local government tax
revenues, improving the creditworthiness of state and local issuers. Holdings
in general obligation bonds benefited from this trend.
_______________________________________________________________________________
2 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Historical Performance
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HISTORICAL PERFORMANCE
An Important Note About the Value of Historical Performance
The performance shown on the following pages represents past performance and
does not guarantee future results. Current performance may be lower or higher
than the performance information shown. You may obtain performance information
current to the most recent month-end by visiting www.alliancebernstein.com.
The investment return and principal value of an investment in the Portfolios
will fluctuate, so that your shares, when redeemed, may be worth more or less
than their original cost. You should consider the investment objectives, risks,
charges and expenses of the Portfolios carefully before investing. For a free
copy of the Portfolios' prospectus, which contains this and other information,
visit our web site at www.alliancebernstein.com or call your financial advisor
or AllianceBernstein at (800) 227-4618. You should read the prospectus
carefully before you invest.
Returns are annualized for periods longer than one year. All fees and expenses
related to the operation of the Portfolios have been deducted. NAV returns do
not reflect sales charges; if sales charges were reflected, the Portfolios'
quoted performance would be lower. SEC returns reflect the applicable sales
charges for each share class: a 4.25% maximum front-end sales charge for Class
A shares; the applicable contingent deferred sales charge for Class B shares
(3% year 1, 2% year 2, 1% year 3, 0% year 4); a 1% 1 year contingent deferred
sales charge for Class C shares. Performance assumes reinvestment of
distributions and does not account for taxes.
Benchmark Disclosure
The unmanaged Lehman Brothers (LB) Municipal Index does not reflect fees and
expenses associated with the active management of a mutual fund portfolio. The
Index is a total return performance benchmark for the long-term investment
grade, tax-exempt bond market. An investor cannot invest directly in an index,
and its results are not indicative of the performance for any specific
investment, including the Portfolios.
A Word About Risk
Price fluctuation in the Portfolios' securities may be caused by changes in the
general level of interest rates or changes in bond credit quality ratings.
Changes in interest rates have a greater effect on bonds with longer maturities
than on those with shorter maturities. Please note, as interest rates rise,
existing bond prices fall and can cause the value of an investment in the
Portfolios to decline. While the Portfolios invest principally in bonds and
other fixed-income securities, in order to achieve their investment objectives,
the Portfolios may at times use certain types of investment derivatives, such
as options, futures, forwards and swaps. These instruments involve risks
different from, and in certain cases, greater than, the risks presented by more
traditional investments. These risks are fully discussed in the Portfolios'
prospectus.
(Historical Performance continued on next page)
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ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 3
Historical Performance
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HISTORICAL PERFORMANCE
(continued from previous page)
THE PORTFOLIOS VS. THEIR BENCHMARKS
PERIODS ENDED APRIL 30, 2005
Returns
------------------------------------
6 Months 12 Months
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National Portfolio
Class A 3.06% 7.64%
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Class B 2.71% 6.90%
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Class C 2.61% 6.90%
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LB Municipal Index 1.93% 6.81%
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Returns
------------------------------------
6 Months 12 Months
- --------------------------------------------------------------
California Portfolio
Class A 2.86% 8.15%
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Class B 2.51% 7.41%
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Class C 2.51% 7.40%
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LB Municipal Index 1.93% 6.81%
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Returns
------------------------------------
6 Months 12 Months
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New York Portfolio
Class A 2.56% 7.64%
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Class B 2.11% 6.80%
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Class C 2.21% 6.80%
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LB Municipal Index 1.93% 6.81%
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See Historical Performance and Benchmark disclosures on page 3.
(Historical Performance continued on next page)
_______________________________________________________________________________
4 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Historical Performance
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HISTORICAL PERFORMANCE
(continued from previous page)
THE PORTFOLIOS VS. THEIR BENCHMARKS
PERIODS ENDED APRIL 30, 2005
Returns
------------------------------------
6 Months 12 Months
- --------------------------------------------------------------
Insured National Portfolio
Class A 2.28% 7.43%
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Class B 1.93% 6.71%
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Class C 1.83% 6.60%
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LB Municipal Index 1.93% 6.81%
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Returns
------------------------------------
6 Months 12 Months
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Insured California Portfolio
Class A 2.18% 6.77%
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Class B 1.90% 6.10%
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Class C 1.83% 6.03%
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LB Municipal Index 1.93% 6.81%
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See Historical Performance and Benchmark disclosures on page 3.
(Historical Performance continued on next page)
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 5
Historical Performance
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NATIONAL PORTFOLIO
HISTORICAL PERFORMANCE
(continued from previous page)
AVERAGE ANNUAL RETURNS AS OF APRIL 30, 2005
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NAV Returns SEC Returns
Class A Shares
1 Year 7.64% 3.08%
5 Years 6.15% 5.23%
10 Years 5.80% 5.34%
SEC Yield* 4.63%
Taxable Equivalent Yield** 8.12%
Class B Shares
1 Year 6.90% 3.90%
5 Years 5.43% 5.43%
10 Years(a) 5.37% 5.37%
SEC Yield* 4.13%
Taxable Equivalent Yield** 6.18%
Class C Shares
1 Year 6.90% 5.90%
5 Years 5.43% 5.43%
10 Years 5.09% 5.09%
SEC Yield* 4.13%
Taxable Equivalent Yield** 6.12%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT CALENDAR QUARTER-END (MARCH 31, 2005)
- --------------------------------------------------------------
Class A Shares
1 Year -1.14%
5 Years 4.71%
10 Years 5.18%
Class B Shares
1 Year -0.36%
5 Years 4.92%
10 Years(a) 5.21%
Class C Shares
1 Year 1.61%
5 Years 4.94%
10 Years 4.93%
(a) Assumes conversion of Class B shares into Class A shares after six years.
* SEC Yields are calculated based on SEC guidelines for the 30-day period
ended April 30, 2005.
** Taxable equivalent yields are based on net asset value (NAV) and a 35%
marginal Federal income tax rate and maximum state, city and local taxes where
applicable.
See Historical Performance disclosures on page 3.
(Historical Performance continued on next page)
_______________________________________________________________________________
6 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Historical Performance
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CALIFORNIA PORTFOLIO
HISTORICAL PERFORMANCE
(continued from previous page)
AVERAGE ANNUAL RETURNS AS OF APRIL 30, 2005
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NAV Returns SEC Returns
Class A Shares
1 Year 8.15% 3.58%
5 Years 6.20% 5.29%
10 Years 6.30% 5.85%
SEC Yield* 4.29%
Taxable Equivalent Yield** 7.80%
Class B Shares
1 Year 7.41% 4.41%
5 Years 5.46% 5.46%
10 Years(a) 5.85% 5.85%
SEC Yield* 3.77%
Taxable Equivalent Yield** 6.33%
Class C Shares
1 Year 7.40% 6.40%
5 Years 5.46% 5.46%
10 Years 5.55% 5.55%
SEC Yield* 3.77%
Taxable Equivalent Yield** 6.31%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT CALENDAR QUARTER-END (MARCH 31, 2005)
- --------------------------------------------------------------
Class A Shares
1 Year -0.39%
5 Years 4.77%
10 Years 5.65%
Class B Shares
1 Year 0.20%
5 Years 4.93%
10 Years(a) 5.65%
Class C Shares
1 Year 2.18%
5 Years 4.93%
10 Years 5.36%
(a) Assumes conversion of Class B shares into Class A shares after six years.
* SEC Yields are calculated based on SEC guidelines for the 30-day period
ended April 30, 2005.
** Taxable equivalent yields are based on net asset value (NAV) and a 35%
marginal Federal income tax rate and maximum state, city and local taxes where
applicable.
See Historical Performance disclosures on page 3.
(Historical Performance continued on next page)
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 7
Historical Performance
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NEW YORK PORTFOLIO
HISTORICAL PERFORMANCE
(continued from previous page)
AVERAGE ANNUAL RETURNS AS OF APRIL 30, 2005
- --------------------------------------------------------------
NAV Returns SEC Returns
Class A Shares
1 Year 7.64% 3.07%
5 Years 6.43% 5.50%
10 Years 6.22% 5.76%
SEC Yield* 4.26%
Taxable Equivalent Yield** 8.95%
Class B Shares
1 Year 6.80% 3.80%
5 Years 5.63% 5.63%
10 Years(a) 5.77% 5.77%
SEC Yield* 3.84%
Taxable Equivalent Yield** 6.60%
Class C Shares
1 Year 6.80% 5.80%
5 Years 5.63% 5.63%
10 Years 5.45% 5.45%
SEC Yield* 3.84%
Taxable Equivalent Yield** 6.60%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT CALENDAR QUARTER-END (MARCH 31, 2005)
- --------------------------------------------------------------
Class A Shares
1 Year -0.49%
5 Years 5.01%
10 Years 5.62%
Class B Shares
1 Year 0.24%
5 Years 5.17%
10 Years(a) 5.61%
Class C Shares
1 Year 2.21%
5 Years 5.14%
10 Years 5.30%
(a) Assumes conversion of Class B shares into Class A shares after six years.
* SEC Yields are calculated based on SEC guidelines for the 30-day period
ended April 30, 2005.
** Taxable equivalent yields are based on net asset value (NAV) and a 35%
marginal Federal income tax rate and maximum state, city and local taxes where
applicable.
See Historical Performance disclosures on page 3.
(Historical Performance continued on next page)
_______________________________________________________________________________
8 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Historical Performance
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INSURED NATIONAL PORTFOLIO
HISTORICAL PERFORMANCE
(continued from previous page)
AVERAGE ANNUAL RETURNS AS OF APRIL 30, 2005
- --------------------------------------------------------------
NAV Returns SEC Returns
Class A Shares
1 Year 7.43% 2.91%
5 Years 6.86% 5.94%
10 Years 6.03% 5.57%
SEC Yield* 3.43%
Taxable Equivalent Yield** 7.12%
Class B Shares
1 Year 6.71% 3.71%
5 Years 6.12% 6.12%
10 Years(a) 5.59% 5.59%
SEC Yield* 2.91%
Taxable Equivalent Yield** 5.35%
Class C Shares
1 Year 6.60% 5.60%
5 Years 6.10% 6.10%
10 Years 5.29% 5.29%
SEC Yield* 2.91%
Taxable Equivalent Yield** 5.34%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT CALENDAR QUARTER-END (MARCH 31, 2005)
- --------------------------------------------------------------
Class A Shares
1 Year -1.82%
5 Years 5.44%
10 Years 5.39%
Class B Shares
1 Year -1.02%
5 Years 5.63%
10 Years(a) 5.41%
Class C Shares
1 Year 0.95%
5 Years 5.63%
10 Years 5.13%
(a) Assumes conversion of Class B shares into Class A shares after six years.
* SEC Yields are calculated based on SEC guidelines for the 30-day period
ended April 30, 2005.
** Taxable equivalent yields are based on net asset value (NAV) and a 35%
marginal Federal income tax rate and maximum state, city and local taxes where
applicable.
See Historical Performance disclosures on page 3.
(Historical Performance continued on next page)
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 9
Historical Performance
- -------------------------------------------------------------------------------
INSURED CALIFORNIA PORTFOLIO
HISTORICAL PERFORMANCE
(continued from previous page)
AVERAGE ANNUAL RETURNS AS OF APRIL 30, 2005
- --------------------------------------------------------------
NAV Returns SEC Returns
Class A Shares
1 Year 6.77% 2.20%
5 Years 6.50% 5.58%
10 Years 6.08% 5.61%
SEC Yield* 3.82%
Taxable Equivalent Yield** 5.46%
Class B Shares
1 Year 6.10% 3.10%
5 Years 5.73% 5.73%
10 Years(a) 5.62% 5.62%
SEC Yield* 3.23%
Taxable Equivalent Yield** 5.61%
Class C Shares
1 Year 6.03% 5.03%
5 Years 5.71% 5.71%
10 Years 5.30% 5.30%
SEC Yield* 3.24%
Taxable Equivalent Yield** 5.67%
SEC AVERAGE ANNUAL RETURNS (WITH SALES CHARGES)
AS OF THE MOST RECENT CALENDAR QUARTER-END (MARCH 31, 2005)
- --------------------------------------------------------------
Class A Shares
1 Year -2.75%
5 Years 5.03%
10 Years 5.40%
Class B Shares
1 Year -2.06%
5 Years 5.18%
10 Years(a) 5.39%
Class C Shares
1 Year -0.11%
5 Years 5.16%
10 Years 5.08%
(a) Assumes conversion of Class B shares into Class A shares after six years.
* SEC Yields are calculated based on SEC guidelines for the 30-day period
ended April 30, 2005.
** Taxable equivalent yields are based on net asset value (NAV) and a 35%
marginal Federal income tax rate and maximum state, city and local taxes where
applicable.
See Historical Performance disclosures on page 3.
_______________________________________________________________________________
10 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Fund Expenses
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FUND EXPENSES
As a shareholder of the Fund, you incur two types of costs: (1) transaction
costs, including sales charges (loads) on purchase payments, contingent
deferred sales charges on redemptions and (2) ongoing costs, including
management fees; distribution (12b-1) fees; and other Fund expenses. This
example is intended to help you understand your ongoing costs (in dollars) of
investing in the Fund and to compare these costs with the ongoing costs of
investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of
the period and held for the entire period as indicated below.
Actual Expenses
The first line of the table below provides information about actual account
values and actual expenses. You may use the information in this line, together
with the amount you invested, to estimate the expenses that you paid over the
period. Simply divide your account value by $1,000 (for example, an $8,600
account value divided by $1,000 = 8.6), then multiply the result by the number
in the first line under the heading entitled "Expenses Paid During Period" to
estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical
account values and hypothetical expenses based on the Fund's actual expense
ratio and an assumed annual rate of return of 5% before expenses, which is not
the Fund's actual return. The hypothetical account values and expenses may not
be used to estimate the actual ending account balance or expenses you paid for
the period. You may use this information to compare the ongoing costs of
investing in the Fund and other funds by comparing this 5% hypothetical example
with the 5% hypothetical examples that appear in the shareholder reports of
other funds.
Please note that the expenses shown in the table are meant to highlight your
ongoing costs only and do not reflect any transactional costs, such as sales
charges (loads), or contingent deferred sales charges on redemptions.
Therefore, the second line of the table is useful in comparing ongoing costs
only, and will not help you determine the relative total costs of owning
different funds. In addition, if these transactional costs were included, your
costs would have been higher.
Beginning Ending
Account Value Account Value Expenses Paid
National Portfolio November 1, 2004 April 30, 2005 During Period*
- -----------------------------------------------------------------------------------------------
Class A
Actual $1,000 $1,030.60 $3.42
Hypothetical (5% return before expenses) $1,000 $1,021.42 $3.41
- -----------------------------------------------------------------------------------------------
Class B
Actual $1,000 $1,027.13 $6.94
Hypothetical (5% return before expenses) $1,000 $1,017.95 $6.90
- -----------------------------------------------------------------------------------------------
Class C
Actual $1,000 $1,026.09 $6.93
Hypothetical (5% return before expenses) $1,000 $1,017.95 $6.90
- -----------------------------------------------------------------------------------------------
California Portfolio
- -----------------------------------------------------------------------------------------------
Class A
Actual $1,000 $1,028.61 $3.87
Hypothetical (5% return before expenses) $1,000 $1,020.98 $3.86
- -----------------------------------------------------------------------------------------------
Class B
Actual $1,000 $1,025.06 $7.38
Hypothetical (5% return before expenses) $1,000 $1,017.50 $7.35
- -----------------------------------------------------------------------------------------------
Class C
Actual $1,000 $1,025.06 $7.38
Hypothetical (5% return before expenses) $1,000 $1,017.50 $7.35
- -----------------------------------------------------------------------------------------------
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 11
Fund Expenses
- -------------------------------------------------------------------------------
Beginning Ending
Account Value Account Value Expenses Paid
New York Portfolio November 1, 2004 April 30, 2005 During Period*
- -----------------------------------------------------------------------------------------------
Class A
Actual $1,000 $1,025.57 $2.91
Hypothetical (5% return before expenses) $1,000 $1,021.92 $2.91
- -----------------------------------------------------------------------------------------------
Class B
Actual $1,000 $1,021.07 $6.41
Hypothetical (5% return before expenses) $1,000 $1,018.45 $6.41
- -----------------------------------------------------------------------------------------------
Class C
Actual $1,000 $1,022.07 $6.42
Hypothetical (5% return before expenses) $1,000 $1,018.45 $6.41
- -----------------------------------------------------------------------------------------------
Insured National Portfolio
- -----------------------------------------------------------------------------------------------
Class A
Actual $1,000 $1,022.75 $5.22
Hypothetical (5% return before expenses) $1,000 $1,019.64 $5.21
- -----------------------------------------------------------------------------------------------
Class B
Actual $1,000 $1,019.29 $8.71
Hypothetical (5% return before expenses) $1,000 $1,016.17 $8.70
- -----------------------------------------------------------------------------------------------
Class C
Actual $1,000 $1,018.29 $8.71
Hypothetical (5% return before expenses) $1,000 $1,016.17 $8.70
- -----------------------------------------------------------------------------------------------
Insured California Portfolio
- -----------------------------------------------------------------------------------------------
Class A
Actual $1,000 $1,021.75 $5.11
Hypothetical (5% return before expenses) $1,000 $1,019.74 $5.11
- -----------------------------------------------------------------------------------------------
Class B
Actual $1,000 $1,018.98 $8.66
Hypothetical (5% return before expenses) $1,000 $1,016.22 $8.65
- -----------------------------------------------------------------------------------------------
Class C
Actual $1,000 $1,018.26 $8.66
Hypothetical (5% return before expenses) $1,000 $1,016.22 $8.65
- -----------------------------------------------------------------------------------------------
Annualized Expense Ratio
-------------------------------------------------------------------------
Insured Insured
National California New York National California
- -----------------------------------------------------------------------------------------------
Class A 0.68% 0.77% 0.58% 1.04% 1.02%
Class B 1.38% 1.47% 1.28% 1.74% 1.73%
Class C 1.38% 1.47% 1.28% 1.74% 1.72%
- -----------------------------------------------------------------------------------------------
* Expenses are equal to the classes' annualized expense ratios, shown in the
table below, multiplied by the average account value over the period,
multiplied by the number of days in the most recent fiscal half-year/365 (to
reflect the one-half year period).
_______________________________________________________________________________
12 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Bond Rating Summary
- -------------------------------------------------------------------------------
BOND RATING SUMMARY*
April 30, 2005 (unaudited)
NATIONAL PORTFOLIO
33.8% AAA
16.4% AA
17.4% A
18.8% BBB [PIE CHART OMITTED]
11.1% BB
1.9% B
0.6% Unrated
CALIFORNIA PORTFOLIO
53.0% AAA
3.9% AA
16.6% A [PIE CHART OMITTED]
19.7% BBB
6.8% BB
NEW YORK PORTFOLIO
44.9% AAA
13.6% AA
26.2% A [PIE CHART OMITTED]
6.2% BBB
8.7% BB
0.4% B
* All data are as of April 30, 2005. Each Portfolio's quality rating
distribution is expressed as a percentage of the Portfolio's total investments
rated in particular ratings categories by Standard & Poor's Rating Services and
Moody's Investors Service. The distributions may vary over time. If ratings are
not available, the Fund's Adviser will assign ratings that are considered to be
of equivalent quality to such ratings.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 13
Bond Rating Summary
- -------------------------------------------------------------------------------
BOND RATING SUMMARY*
April 30, 2005 (unaudited)
INSURED NATIONAL PORTFOLIO
71.6% AAA
26.9% AA [PIE CHART OMITTED]
1.5% A
INSURED CALIFORNIA PORTFOLIO
93.2% AAA
4.3% AA [PIE CHART OMITTED]
2.5% A
* All data are as of April 30, 2005. Each Portfolio's quality rating
distribution is expressed as a percentage of the Portfolio's total investments
rated in particular ratings categories by Standard & Poor's Rating Services and
Moody's Investors Service. The distributions may vary over time. If ratings are
not available, the Fund's Adviser will assign ratings that are considered to be
of equivalent quality to such ratings.
_______________________________________________________________________________
14 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
NATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 2005 (unaudited)
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
MUNICIPAL BONDS-97.0%
Long-Term Municipal Bonds-97.0%
Alabama-0.7%
Jefferson Cnty Ltd Oblig Sch Warrants
Ser 04A
5.25%, 1/01/23 $ 1,200 $ 1,270,932
Montgomery Bmc Spl Care Facs Fing Auth Rev
(Baptist Health) Ser 04C
5.25%, 11/15/29 2,190 2,227,734
-------------
3,498,666
-------------
Arizona-2.7%
Estrella Mtn Ranch CFD
(Desert Village) Ser 02
7.38%, 7/01/27 2,892 3,151,904
Phoenix Civic Impt Corp Wastewtr Sys Rev
MBIA Ser 04
5.00%, 7/01/23-7/01/24 2,800 2,980,747
Pima Cnty IDA
(Horizon Cmnty Learning Center) Ser 05
5.125%, 6/01/20 3,310 3,389,804
Sundance CFD
Ser 02
7.75%, 7/01/22 1,000 1,028,260
Vistancia CFD
Ser 02
6.75%, 7/15/22 2,000 2,147,880
-------------
12,698,595
-------------
California-6.2%
California Dept Wtr Rev
AMBAC Ser 02A
5.50%, 5/01/14 1,340 1,509,229
California Dept Wtr Rev
Ser 02A
5.38%, 5/01/22 2,000 2,159,840
California Eco Recov
(Rols II-R 326) MBIA Ser 05
8.72%, 7/01/12(a) 2,335 3,083,764
California GO
AMBAC Ser 02B
5.00%, 4/01/27 2,650 2,766,203
AMBAC Ser 03
5.00%, 2/01/33 1,000 1,045,260
Ser 02
5.25%, 4/01/30 825 868,362
Ser 04
5.13%, 2/01/28 1,000 1,046,900
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 15
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
California PCR
(So Calif) Ser 86A
2.00%, 2/28/08 $ 7,500 $ 7,431,975
Chula Vista IDR
(San Diego Gas) Ser 96A
5.30%, 7/01/21 4,000 4,286,480
Manteca Uni Sch Dist
MBIA Ser 01
Zero coupon, 9/01/31 11,910 3,107,081
San Jose MFHR
(Almaden Apts) Ser 01G AMT
5.35%, 7/15/34 1,605 1,694,687
-------------
28,999,781
-------------
Colorado-1.3%
Colorado HFA SFMR
(Mtg Rev) Ser 99A-2 AMT
6.45%, 4/01/30 1,010 1,047,117
Colorado Hlth Facs Auth Rev
(Parkview Med Ctr) Ser 04
5.00%, 9/01/25 1,690 1,716,330
Denver City & Cnty Arpt Auth
(United Airlines) Ser 92A AMT
6.875%, 10/01/32(b) 3,075 2,626,511
Todd Creek Farms Met Dist # 1
Wtr and Wastewtr Rev Ser 04
6.13%, 12/01/19 820 819,492
-------------
6,209,450
-------------
Connecticut-0.2%
Connecticut Hlth & Ed Facs Auth Rev
(Griffin Hosp) Radian Ser 05B
5.00%, 7/01/23 750 780,885
-------------
Florida-20.6%
Beacon Tradeport CDD
Ser 02B
7.25%, 5/01/33 1,770 1,896,998
Bonnet Creek CDD
Ser 02
7.25%, 5/01/18 2,000 2,143,360
Clay Cnty CDD
(Crossings at Fleming Island) Ser 00C
7.05%, 5/01/15 1,965 2,102,000
Collier Cnty CFD
(Fiddlers Creek) Ser 96
7.50%, 5/01/18 970 1,018,810
Collier Cnty IDR
(Southern St Util) Ser 96 AMT
6.50%, 10/01/25 3,605 3,752,048
_______________________________________________________________________________
16 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Dade Cnty Arpt Rev
(Miami Int'l) MBIA Ser 95B AMT
6.00%, 10/01/24 $ 4,730 $ 4,881,786
Gateway CDD
(Sun City Center)
5.50%, 5/01/10 650 663,468
Indian Trace Dev Dist Spl Assmt
(Wtr Mgmt Spl Benefit) Ser 05 MBIA
5.00%, 5/01/22-5/01/23 1,800 1,930,560
Jacksonville Elec Auth
Ser 02A
5.50%, 10/01/41 3,750 3,985,912
Jacksonville Hosp Rev
(Mayo Clinic) Ser 01C
5.50%, 11/15/36 6,750 7,310,047
Lee Cnty CDD
(Miromar Lakes) Ser 00A
7.25%, 5/01/12 4,485 4,769,035
(Stoneybrook) Ser 98
5.70%, 5/01/08 85 86,210
Lee Cnty CFD
(Herons Glen) Ser 99
6.00%, 5/01/29 6,300 6,492,402
Lee Cnty HFA SFMR
(Mtg Rev) GNMA/FNMA Ser 00A-1 AMT
7.20%, 3/01/33 180 180,653
Manatee Cnty CDD
(Tara) Ser 00A
7.15%, 5/01/31 1,880 2,007,126
Marshall Creek CDD
Ser 02
6.63%, 5/01/32 1,705 1,808,033
Miami Beach Hosp Rev
(Mt Sinai Med Center) Ser 01A
6.80%, 11/15/31 3,500 3,827,005
Miami Dade Cnty HFA MFHR
(Marbrisa Apts) FSA Ser 00-2A AMT
6.15%, 8/01/38 4,200 4,498,830
Northern Palm Beach Cnty
(ABACOA) Ser 96A
7.20%, 8/01/16 8,000 8,593,040
7.30%, 8/01/27 8,000 8,602,720
Orange Cnty HFA MFHR
(Seminole Pt Proj) Ser 99L AMT
5.80%, 6/01/32 6,855 7,146,269
Orlando Assess Dist
(Conroy Rd Proj) Ser 98A
5.80%, 5/01/26 3,250 3,326,635
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 17
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Pasco Cnty HFA MFHR
(Pasco Woods Apts) Ser 99A AMT
5.90%, 8/01/39 $ 3,690 $ 3,874,279
Pier Park CDD
Ser 02-1
7.15%, 5/01/34 4,700 4,978,428
Preserve at Wilderness Lake CDD
Ser 02B
6.20%, 11/01/08 405 412,606
Volusia Cnty Ed Fac
(Embry-Riddle Aero Univ) Ser 96A
6.13%, 10/15/26 4,135 4,384,837
Westchester CDD
Ser 03
6.00%, 5/01/23 2,000 2,086,820
-------------
96,759,917
-------------
Illinois-2.3%
Chicago Arpt Rev
(O'Hare Int'l Arpt) XLCA Ser 03B-1
5.25%, 1/01/34 3,400 3,603,490
Chicago HFA SFMR
(Mtg Rev) GNMA/FNMA/FHLMC Ser 98A AMT
6.45%, 9/01/29 565 571,955
(Mtg Rev) GNMA/FNMA/FHLMC
Ser 98C-1 AMT
6.30%, 9/01/29 385 391,098
(Mtg Rev) GNMA/FNMA/FHLMC Ser 99A AMT
6.35%, 10/01/30 475 499,420
(Mtg Rev) GNMA/FNMA/FHLMC Ser 99C AMT
7.05%, 10/01/30 145 145,338
Chicago Spec Assess
(Lake Shore East) Ser 03
6.75%, 12/01/32 3,500 3,693,200
Met Pier & Expo Auth Spec Tax Rev
(McCormick Place) MBIA Ser 02A
5.25%, 6/15/42 1,750 1,854,178
-------------
10,758,679
-------------
Indiana-0.3%
Hendricks Cnty Bldg Facs Corp
(First Mtg) Ser 04
5.50%, 7/15/23 1,165 1,288,199
-------------
Louisiana-1.2%
De Soto Parish PCR
(Int'l Paper Co) Ser 02A
5.00%, 10/01/12 4,000 4,240,960
_______________________________________________________________________________
18 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Louisiana Arpt Fac
(Cargo ACQ Grp) Ser 02 AMT
6.65%, 1/01/25 $ 1,125 $ 1,196,055
-------------
5,437,015
-------------
Maine-0.4%
Jay PCR
(Int'l Paper) Ser 99A AMT
6.25%, 9/01/23 1,800 1,926,378
-------------
Maryland-2.5%
Maryland CDA SFMR
(Mtg Rev) Ser 00A AMT
6.10%, 7/01/38 6,285 6,573,921
Maryland IDR
(Med Waste Assoc) Ser 89 AMT
8.75%, 11/15/10(c) 1,225 869,824
Tax Exempt Municipal Infrastructure
Ser 04A
3.80%, 5/01/08 4,035 4,058,806
-------------
11,502,551
-------------
Massachusetts-7.3%
Massachusetts Dev Fin Agy Hlth Fac
(Seven Hills) Asset Gty Ser 99
5.15%, 9/01/28 6,035 6,215,989
Massachusetts GO
Ser 02C Unrefunded
5.25%, 11/01/30 1,780 1,980,001
Ser 02C Prerefunded
5.25%, 11/01/30 3,220 3,581,799
Massachusetts Port Auth
Ser 99D AMT
6.00%, 7/01/29 7,500 8,287,950
Massachusetts Port Auth Spec Fac
(BosFuel Corp) MBIA Ser 97 AMT
6.00%, 7/01/36 11,920 12,514,689
New England Student Loan Rev
Ser 93H AMT
6.90%, 11/01/09 1,500 1,616,505
-------------
34,196,933
-------------
Michigan-5.5%
Detroit Local Dev Fin Auth
(DaimlerChrysler Assembly Plant) Ser 98A
5.50%, 5/01/21 535 493,452
Kent Hosp Fin Auth
(Met Hosp Project) Ser 05A
5.75%, 7/01/25 710 758,372
Michigan HDA MFHR
(Rental Rev) AMBAC Ser 97A AMT
6.10%, 10/01/33 1,000 1,039,600
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 19
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Michigan Hosp Fin Auth
(Marquette Gen Hosp Oblig Grp) Ser 05A
5.00%, 5/15/26 $ 800 $ 812,608
(Sparrow Med Ctr) Ser 01
5.63%, 11/15/36 2,650 2,795,326
(Trinity Health) Ser 00A
6.00%, 12/01/27 4,515 4,995,893
Midland Cnty PCR
(CMS Energy) Ser 00A AMT
6.88%, 7/23/09 8,000 8,340,320
Saginaw Hosp Rev
(Covenant Med Ctr) Ser 00F
6.50%, 7/01/30 6,125 6,779,211
-------------
26,014,782
-------------
Minnesota-1.4%
Minn-St Paul Met Arpt Rev
FGIC Ser 00B AMT
6.00%, 1/01/21 3,520 3,870,768
Shakopee Hlth Care Facs Rev
(St. Francis Regl Med Ctr) Ser 04
5.10%, 9/01/25 2,700 2,786,778
-------------
6,657,546
-------------
Mississippi-0.3%
Warren Cnty PCR
(Int'l Paper) Ser 99A AMT
6.25%, 9/01/23 1,300 1,393,899
-------------
Missouri-0.6%
Kansas City Arpt Fac Rev
(Cargo ACQ Grp) Ser 02
6.25%, 1/01/30 1,985 2,031,985
Missouri Dev Fin Brd Infrastructure Fac Rev
(Crackerneck Creek Project) Ser 05C
5.00%, 3/01/26 1,000 1,002,760
-------------
3,034,745
-------------
Nevada-0.8%
Carson City Hosp Rev
(Carson-Tahoe Hosp Proj) Radian Ser 03A
5.13%, 9/01/29 2,700 2,780,001
North Las Vegas CDD
Ser 03
6.40%, 12/01/22 1,000 1,030,240
-------------
3,810,241
-------------
New Hampshire-0.9%
New Hampshire Bus Fin Auth PCR
(Public Service Co) Ser 93E AMT
6.00%, 5/01/21 4,000 4,210,840
-------------
_______________________________________________________________________________
20 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
New Jersey-5.7%
Morris-Union Jointure Commn COP
Radian Ser 04
5.00%, 5/01/27 $ 5,175 $ 5,368,700
New Jersey Eco Dev Auth Rev
(Rols II-R 305) FGIC Ser 04
6.87%, 6/15/13(a) 8,100 9,599,472
(Rols II-R 311) FGIC Ser 04
6.87%, 6/15/12(a) 6,000 7,124,400
New Jersey Ed Facs Auth
AMBAC Ser 03
7.40%, 9/01/21(a) 4,000 4,708,560
-------------
26,801,132
-------------
New York-6.5%
Erie Cnty IDA Sch Fac Rev
(Buffalo Sch Dist Proj) FSA Ser 04
5.75%, 5/01/25-5/01/26 3,800 4,313,942
Grand Central
Ser 04-394
6.69%, 1/01/12(a) 1,785 2,061,622
New York City Mun Wtr Fin Auth
Ser 04-401
10.10%, 12/15/11(a) 1,495 1,974,775
New York GO
Ser 03
5.50%, 8/01/21 5,000 5,441,250
5.75%, 3/01/15-3/01/17 4,250 4,781,298
Ser 04G
5.00%, 12/01/23 895 937,987
Ser 04I
5.00%, 8/01/21 1,000 1,051,300
Ser 97A Prerefunded
6.25%, 8/01/17 5,750 6,082,177
New York Hsg Fin Agy
Personal Income Tax Rev
(Eco Dev & Hsg) Ser 05A FGIC
5.00%, 9/15/25 1,200 1,272,840
New York IDA
(Lycee Francais) ACA Ser 02C
6.80%, 6/01/28 2,500 2,611,250
-------------
30,528,441
-------------
Ohio-5.3%
Cuyahoga Cnty Port Auth Rev
Ser 01
7.35%, 12/01/31 5,400 5,724,324
Franklin Cnty
(OCLC Online Computer Libry Ctr) Ser 98
5.20%, 10/01/20 1,200 1,265,712
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 21
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Port Auth of Columbiana Cnty SWR
(Apex Environmental, Llc.) Ser 04A AMT
7.13%, 8/01/25 $ 1,240 $ 1,254,892
Toledo Lucas Cnty Port Auth Rev
(Crocker Park Proj) Ser 03
5.38%, 12/01/35 5,000 5,343,050
Toledo Lucas Cnty Port Fac Rev
(CSX Transp) Ser 92
6.45%, 12/15/21 9,730 11,381,376
-------------
24,969,354
-------------
Oregon-0.8%
Oregon Hsg Dev Agy SFMR
(Mtg Rev) Ser 02B AMT
5.45%, 7/01/32 3,560 3,640,029
-------------
Pennsylvania-4.4%
Ephrata Area Sch Dist
Ser 05 FGIC
5.00%, 3/01/22 2,565 2,745,730
Montgomery Cnty Hosp Rev
(Abington Mem Hosp) Ser 02A
5.13%, 6/01/32 2,000 2,059,200
Montgomery Cnty IDA Rev
(Whitemarsh Cont Care Proj) Ser 05
6.00%, 2/01/21 1,210 1,252,011
Pennsylvania HFA
FSA Ser 03-1235
7.31%, 6/01/08(a) 785 785,000
Ser 04-1263 AMT
5.42%, 6/01/08(a) 855 855,000
Pennsylvania HFA SFMR
(Mtg Rev) Ser 03 AMT
3.51%, 6/01/08(a) 4,708 4,707,692
Pennsylvania Hgr Ed Hosp Rev
(UPMC) Ser 01A
6.00%, 1/15/31 3,845 4,240,997
South Central Hosp Rev
(Wellspan Hlth) MBIA Ser 01
5.25%, 5/15/31(d) 3,800 3,974,762
-------------
20,620,392
-------------
Puerto Rico-0.7%
Puerto Rico Commonwealth
MBIA Ser 04-441
12.95%, 1/01/09(a) 2,125 3,089,155
-------------
Rhode Island-0.4%
Rhode Island Solid Waste Disp Rev
(Waste Management, Inc. Proj) Ser 04A AMT
2.75%, 4/01/16 2,020 2,004,406
-------------
_______________________________________________________________________________
22 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
South Carolina-0.1%
Richland Lexington Arpt Rev
(Columbia Met Arpt) FSA Ser 04
5.13%, 1/01/25 $ 500 $ 519,860
-------------
Texas-15.2%
Alliance Arpt Fac
(Federal Express) Ser 96 AMT
6.38%, 4/01/21 12,550 13,184,653
Brownwood ISD
(Schl Bldg) Ser 05 FGIC
5.25%, 2/15/22-2/15/24 3,505 3,790,886
Corpus Christi Arpt Rev
(Corpus Christi Int'l) FSA Ser 00B
5.38%, 2/15/30 7,100 7,602,680
Dallas Fort Worth Arpt Rev
FGIC Ser 01 AMT
5.50%, 11/01/35 13,400 14,178,004
Ector Cnty Sch Dist
Ser 03
5.25%, 8/15/27 3,000 3,218,190
Grapevine Arpt Rev
(Cargo ACQ Grp) Ser 02 AMT
6.50%, 1/01/24 1,000 1,056,020
Guadalupe-Blanco Riv Auth
Contract & Sub Wtr Res Div & Water Surp Rev
MBIA Ser 04A
5.00%, 8/15/24 1,440 1,506,010
Hidalgo Cnty Hlth Svcs
(Mission Hosp, Inc. Proj) Ser 05
5.00%, 8/15/14-8/15/19 730 748,598
Houston Arpt Fac
(Continental Airlines) Ser 01E AMT
7.00%, 7/01/29 2,750 2,455,998
Houston Arpt Rev
(Cargo ACQ Grp) Ser 02 AMT
6.38%, 1/01/23 3,000 3,125,910
Laredo ISD Pub Fac Corp
Lease Rev AMBAC Ser 04A
5.00%, 8/01/24 1,000 1,042,900
Mission Cons ISD
Ser 05 PSF-GTD
5.00%, 2/15/28 2,785 2,909,712
Richardson Hosp Auth Rev
(Richardson Regional) Ser 04
5.88%, 12/01/24 2,310 2,462,714
6.00%, 12/01/19 1,830 2,015,233
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 23
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
San Antonio GO
Ser 02 Unrefunded
5.00%, 2/01/22 $ 3,060 $ 3,216,917
Ser 02 Prerefunded
5.00%, 2/01/22 40 44,103
Seguin Hgr Ed Rev
(Texas Lutheran Univ Proj) Ser 04
5.25%, 9/01/28 1,000 1,012,430
Texas Turnpike Auth
AMBAC Ser 04-284
9.06%, 8/15/39(a) 3,000 3,644,850
Tyler Hosp Rev
(Mother Francis Regl Hlth) Ser 01
6.00%, 7/01/31 3,900 4,103,229
-------------
71,319,037
-------------
Virginia-1.4%
Arlington IDA Hosp Rev
(Arlington Hlth Sys) Ser 01
5.25%, 7/01/31 1,000 1,042,560
Bell Creek CDD
Ser 03A
6.75%, 3/01/22 2,522 2,620,761
Broad St CDD
Ser 03
7.50%, 6/01/33 3,000 3,132,510
-------------
6,795,831
-------------
Wisconsin-0.8%
Milwaukee Arpt Rev
(Cargo ACQ Grp) Ser 02 AMT
6.50%, 1/01/25 2,340 2,478,575
Wisconsin Hlth & Ed Facs Auth Rev
(Bell Tower Residence Proj) Ser 05
5.00%, 7/01/25 1,270 1,288,110
-------------
3,766,685
-------------
U.S. Virgin Islands-0.5%
Virgin Islands Pub Fin Auth
FSA Ser 03A-1233
12.24%, 10/01/11(a) 255 399,126
FSA Ser 03B-1233
12.24%, 10/01/14(a) 150 240,135
FSA Ser 03C-1233
13.50%, 10/01/15(a) 210 351,878
FSA Ser 03D-1233
13.50%, 10/01/16(a) 540 881,842
FSA Ser 03E-1233
13.50%, 10/01/17(a) 330 526,822
-------------
2,399,803
-------------
_______________________________________________________________________________
24 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Value
- -------------------------------------------------------------------------------
Total Investments-97.0%
(cost $430,847,410) $ 455,633,227
Other assets less liabilities-3.0% 13,874,273
-------------
Net Assets-100% $ 469,507,500
=============
INTEREST RATE SWAP TRANSACTIONS (see Note D)
Rate Type
-------------------------------
Payments Payments
Notional made received Unrealized
Swap Amount Termination by the by the Appreciation/
Counterparty (000) Date Portfolio Portfolio (Depreciation)
- -------------------------------------------------------------------------------------------------
Goldman Sachs $28,700 2/03/06 76.48% of BMA* $(17,587)
1 Month LIBOR**
Goldman Sachs 7,500 3/01/06 2.255% BMA* 23,679
J.P. Morgan 11,200 6/08/05 1.25% BMA* 21,277
J.P. Morgan 4,400 5/05/07 BMA* 2.988% 8,941
Merrill Lynch + 4,550 5/27/05 BMA* 3.91% (16,011)
Merrill Lynch 28,700 2/03/06 BMA* 85.10% of 88,144
1 Month LIBOR**
* BMA (Bond Market Association)
** LIBOR (London Interbank Offered Rate)
+ Represents a forward interest rate swap whose effective date for the
exchange of cash flows is May 25, 2005.
(a) Inverse floater security--security with variable or floating interest rate
that moves in opposite direction of short-term interest rates.
(b) Security is in default and is non-income producing.
(c) Security is exempt from registration under Rule 144A of the Securities Act
of 1933. This security is considered to be liquid and may be resold in
transactions exempt from registration, normally to qualified buyers. At April
30, 2005, the market value of this security amounted to $869,824 or .18% of net
assets.
(d) Represents entire or partial position segregated as collateral for
interest rate swap.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 25
National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Glossary of Terms:
ACA - American Capital Access Financial Guaranty Corporation
AMBAC - American Municipal Bond Assurance Corporation
AMT - Alternative Minimum Tax - (subject to)
CDA - Community Development Administration
CDD - Community Development District
CFD - Community Facilities District
COP - Certificates of Participation
FGIC - Financial Guaranty Insurance Company
FHLMC - Federal Home Loan Mortgage Corporation
FNMA - Federal National Mortgage Association
FSA - Financial Security Assurance Inc.
GNMA - Government National Mortgage Association
GO - General Obligation
HDA - Housing Development Authority
HFA - Housing Finance Authority
IDA - Industrial Development Authority
IDR - Industrial Development Revenue
ISD - Independent School District
MBIA - Municipal Bond Investors Assurance
MFHR - Multi-Family Housing Revenue
PCR - Pollution Control Revenue
PSF-GTD - (Texas) Permanent School Funds
SFMR - Single Family Mortgage Revenue
SWDR - Solid Waste Disposal Revenue
SWR - Solid Waste Revenue
UPMC - University of Pennslyvania Medical Center
XLCA - XL Capital Assurance Inc.
See notes to financial statements.
_______________________________________________________________________________
26 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Insured National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
INSURED NATIONAL PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 2005 (unaudited)
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
MUNICIPAL BONDS-96.4%
Long-Term Municipal Bonds-96.4%
Alabama-0.7%
Jefferson Cnty Wtr & Swr Rev
FGIC Ser 02B
5.00%, 2/01/41(a) $ 625 $ 691,638
FGIC Ser 02B Prerefunded
5.00%, 2/01/41 375 411,191
-------------
1,102,829
-------------
Alaska-4.3%
Alaska HFC SFMR
(Mtg Rev) MBIA Ser 97A
6.00%, 6/01/27 6,500 6,769,815
-------------
Arizona-0.6%
Phoenix Civic Impt Corp Wastewtr Sys Rev
MBIA Ser 04
5.00%, 7/01/24 950 1,009,461
-------------
California-7.5%
California GO
5.13%, 2/01/28 1,500 1,570,350
AMBAC Ser 02B
5.00%, 4/01/27 3,000 3,131,550
AMBAC Ser 03
5.00%, 2/01/33 1,365 1,426,780
FSA Ser 03
5.00%, 2/01/29 1,445 1,515,501
Golden St
Tob Settlement Bonds XLCA Ser 03
5.50%, 6/01/332,000 2,187,880
San Bernardino Cnty Redev
(Ontario Proj #1) MBIA Ser 93 ETM
5.80%, 8/01/23 2,000 2,018,620
-------------
11,850,681
-------------
Colorado-8.8%
Denver City & Cnty Arpt Rev
MBIA Ser 95A
5.70%, 11/15/25 6,375 6,600,037
Northwest Parkway Toll Rev
FSA Ser 01C
5.80%, 6/15/25(b) 9,000 7,318,890
-------------
13,918,927
-------------
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 27
Insured National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Florida-2.0%
Volusia Cnty Hlth Fac
(John Knox Village) Asset Gty Ser 96A
6.00%, 6/01/17 $ 3,000 $ 3,114,720
-------------
Illinois-7.0%
Chicago Arpt Rev
(O'Hare Int'l Arpt) XLCA Ser 03
5.25%, 1/01/34 1,700 1,801,745
Chicago Stadium Rev
(Soldier Field) AMBAC Ser 01
5.50%, 6/15/30(b) 9,000 7,383,240
Met Pier & Expo Auth
(McCormick Place) MBIA Ser 02A
5.25%, 6/15/42 1,750 1,854,178
-------------
11,039,163
-------------
Massachusetts-5.9%
Massachusetts HFA MFHR
(Rental Rev) AMBAC Ser 93A
6.15%, 10/01/15 40 40,163
Massachusetts Hlth & Ed Facs Hosp Rev
(Berkshire Hlth Sys) Asset Gty Ser 01E
5.70%, 10/01/25 7,000 7,695,870
(Cape Cod Healthcare) Asset Gty Ser 01C
5.25%, 11/15/31 1,600 1,688,480
-------------
9,424,513
-------------
Michigan-8.8%
Detroit Wtr Sply Sys
FGIC Ser 01
5.50%, 7/01/33 1,450 1,588,113
Kalamazoo Hosp Rev
(Borgess Med Ctr) FGIC Ser 94A ETM
7.34%, 6/01/11(c) 5,140 5,260,173
Michigan Mun Bd Auth Rev
(Sch Dist City of Detroit) Ser 05 FSA WI
5.00%, 6/01/20 1,500 1,595,175
Michigan Strategic Fund
(Detroit Edison Co) MBIA Ser 95AA
6.40%, 9/01/25 2,335 2,409,930
Michigan Trunk Line Fund
FSA Ser 01A
5.25%, 11/01/30 1,000 1,055,630
PontiacTax Increment
ACA Ser 02
5.625%, 6/01/22 700 744,513
Royal Oak Hosp Rev
(William Beaumont) MBIA Ser 01M
5.25%, 11/15/35 1,300 1,355,367
-------------
14,008,901
-------------
_______________________________________________________________________________
28 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Insured National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Minnesota-5.0%
Waconia Hlth Fac
(Ridgeview Med Ctr) Asset Gty Ser 99A
6.125%, 1/01/29 $ 7,095 $ 7,898,438
-------------
Nevada-1.4%
Carson City Hosp Rev
(Carson-Tahoe Hosp) Radian Ser 03A
5.125%, 9/01/29 2,100 2,162,223
-------------
New Hampshire-1.6%
New Hampshire Hosp Rev
(Mary Hitchcock Hosp) FSA Ser 02
5.50%, 8/01/27 2,250 2,461,703
-------------
New Jersey-4.7%
Morris-Union Jointure COP
Radian Ser 04
5.00%, 5/01/27 1,700 1,763,631
New Jersey Eco Dev Auth Rev
(Cigarette Tax) FGIC Ser 04
5.00%, 6/15/12 1,500 1,640,550
New Jersey Ed Facs Auth Rev
AMBAC Ser 02A
5.125%, 9/01/22 2,500 2,678,550
AMBAC Ser 03
7.40%, 9/01/21(c) 1,210 1,424,339
-------------
7,507,070
-------------
New York-6.3%
Erie Cnty IDA Sch Fac Rev
(Buffalo Sch Dist Proj) FSA Ser 04
5.75%, 5/01/26 1,300 1,474,603
Nassau Cnty Hlth Fac Rev
(Nassau Hlth Sys) FSA Ser 99
5.75%, 8/01/29 7,600 8,560,184
-------------
10,034,787
-------------
Ohio-8.4%
Hamilton Cnty Sales Tax Rev
AMBAC Ser 00B
5.25%, 12/01/32 7,100 7,596,432
Summit Cnty GO
FGIC Ser 00 Prerefunded
6.00%, 12/01/21 5,000 5,768,000
-------------
13,364,432
-------------
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 29
Insured National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Pennsylvania-9.6%
Allegheny Cnty Hgr Ed Rev
(Carnegie Mellon Univ) Ser 02
5.50%, 3/01/28 $ 7,165 $ 7,792,009
Pennsylvania Turnpike Transp Rev
AMBAC Ser 01
5.25%, 7/15/41 7,000 7,372,680
-------------
15,164,689
-------------
Puerto Rico-4.8%
Puerto Rico Elec Pwr Auth
XLCA Ser 02-1
5.25%, 7/01/22(d) 6,935 7,553,463
-------------
Rhode Island-4.6%
Rhode Island Eco Dev Auth
(Providence Place Mall Proj) Asset Gty Ser 00
6.125%, 7/01/20 6,500 7,369,310
-------------
Texas-2.7%
Guadalupe-Blanco Riv Auth & Surp
(Contract & Sub Wtr Res) MBIA Ser 04A
5.00%, 8/15/24 455 475,857
San Antonio GO
Ser 02
5.00%, 2/01/23 1,485 1,554,914
Ser 02 Prerefunded
5.00%, 2/01/23 15 16,539
Texas Turnpike Auth
AMBAC Series 02A
5.50%, 8/15/39 2,000 2,171,960
-------------
4,219,270
-------------
West Virginia-1.7%
Fairmont Higher Ed
(Fairmont St Col) FGIC Ser 02A
5.375%, 6/01/27 2,500 2,714,325
-------------
Total Investments-96.4%
(cost $141,373,150) 152,688,720
Other assets less liabilities-3.6% 5,670,128
-------------
Net Assets-100% $ 158,358,848
=============
_______________________________________________________________________________
30 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Insured National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
INTEREST RATE SWAP TRANSACTIONS (see Note D)
Rate Type
-------------------------------
Payments Payments
Notional made received Unrealized
Swap Amount Termination by the by the Appreciation/
Counterparty (000) Date Portfolio Portfolio (Depreciation)
- ----------------------------------------------------------------------------------------------------
Goldman Sachs $ 9,500 2/03/06 76.48% of BMA* $ (5,821)
1 Month LIBOR**
J.P. Morgan 2,500 7/08/05 1.257% BMA* 7,907
J.P. Morgan 1,500 5/05/07 BMA* 2.988% 3,048
J.P. Morgan + 2,600 11/05/24 4.419% BMA* (66,787)
Merrill Lynch 9,500 2/03/06 BMA* 85.10% of 29,176
1 Month LIBOR**
Merrill Lynch ++ 3,100 11/01/19 3.896% BMA* (36,813)
* BMA (Bond Market Association)
** LIBOR (London Interbank Offered Rate)
+ Represents a forward interest rate swap whose effective date of the exchange
of cash flows is May 5, 2005.
++ Represents a forward interest rate swap whose effective date of the
exchange of cash flows is May 1, 2005.
FINANCIAL FUTURES CONTRACTS PURCHASED (see Note D)
Value at
Number of Expiration Original April 30, Unrealized
Type Contracts Month Value 2005 Depreciation
- ----------------------------------------------------------------------------------------------------
U.S. T-Note
10 Yr Future 14 June 2005 $1,560,615 $1,559,906 $ (709)
(a) Position, or portion thereof, with a market value of $343,052 has been
segregated to collaterize margin requirements for open futures contracts.
(b) Indicates a security that has a zero coupon that remains in effect until a
predetermined date at which time the stated coupon rate becomes effective until
final maturity.
(c) Inverse floater security--security with variable or floating interest rate
that moves in oppo-site direction of short-term interest rates.
(d) Represents entire or partial position segregated as collateral for
interest rate swap.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 31
Insured National Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Glossary of Terms:
ACA - American Capital Access Financial Guaranty Corporation
AMBAC - American Municipal Bond Assurance Corporation
COP - Certificate of Participation
ETM - Escrow to Maturity
FGIC - Financial Guaranty Insurance Company
FSA - Financial Security Assurance Inc.
GO - General Obligation
HFA - Housing Finance Authority
HFC - Housing Finance Corporation
IDA - Industrial Development Authority/Agency
MBIA - Municipal Bond Investors Assurance
MFHR - Multi-Family Housing Revenue
SFMR - Single Family Mortgage Revenue
XLCA - XL Capital Assurance Inc.
WI - When-Issued Securities
See notes to financial statements.
_______________________________________________________________________________
32 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
New York Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
NEW YORK PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 2005 (unaudited)
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
MUNICIPAL BONDS-99.8%
Long-Term Municipal Bonds-99.8%
Arizona-0.5%
Goodyear IDA Wtr & Swr Rev
(Litchfield Park Proj) Ser 01 AMT
6.75%, 10/01/31 $ 1,000 $ 1,055,340
Quailwood Meadows CFD
Ser 04
6.00%, 7/15/22 1,120 1,134,470
-------------
2,189,810
-------------
California-0.2%
California GO
Ser 03
5.25%, 11/01/25 650 697,366
Ser 04
5.20%, 4/01/26 350 371,497
-------------
1,068,863
-------------
Florida-3.5%
Crossings at Fleming Island CDD
(Eagle Harbor) Ser 00
7.10%, 5/01/30 5,500 5,860,690
Fiddlers Creek CDD
Ser 96
7.50%, 5/01/18 3,260 3,424,043
Ser 99B
5.80%, 5/01/21 1,525 1,593,351
Hammock Bay CDD
Ser 04A
6.15%, 5/01/24 1,200 1,215,180
Manatee Cnty CDD
(Heritage Harbor South) Ser 02B
5.40%, 11/01/08 700 703,304
Marshall Creek CDD
Ser 02A
6.625%, 5/01/32 970 1,028,617
Midtown Miami CDD
Ser 04A
6.00%, 5/01/24 2,500 2,623,100
-------------
16,448,285
-------------
Illinois-0.9%
Antioch Village Spl Svc Area
(Clublands Proj) Ser 03
6.625%, 3/01/33 1,000 1,014,700
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 33
New York Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Plano Spl Svcs Area No.3
(Lakewood Springs Proj) Ser 05A
5.95%, 3/01/28 $ 1,350 $ 1,355,602
Yorkville Spl Svc Area
(Raintree Vlg Proj) Ser 03
6.875%, 3/01/33 2,000 2,093,740
-------------
4,464,042
-------------
Nevada-0.8%
Clark Cnty Impt Dist
Ser 03
6.10%, 8/01/18 1,500 1,545,495
Henderson Local Impt Dist
Ser 03
5.80%, 3/01/23 990 1,022,135
North Las Vegas CDD
Ser 03
6.40%, 12/01/22 1,000 1,030,240
-------------
3,597,870
-------------
New Jersey-1.9%
Garden St Pres Tr
Open Space & Farmland FSA Ser 05A
5.80%, 11/01/17 1,500 1,725,810
5.80%, 11/01/21 6,500 7,364,370
-------------
9,090,180
-------------
New York-87.7%
Cattaraugus Cnty Hgr Ed
(Jamestown) Ser 00A
6.50%, 7/01/30 1,000 1,111,390
Cortland Cnty Hosp Rev
(Cortland Mem Hosp) Radian Ser 02
5.25%, 7/01/32 2,700 2,829,330
Erie Cnty IDA Sch Fac Rev
(Buffalo Sch Dist Proj) FSA Ser 04
5.75%, 5/01/24-5/01/25 3,800 4,322,690
Essex Cnty IDR
(Int'l Paper) Ser 95A AMT
5.80%, 12/01/19 4,750 4,876,778
Glen Cove IDR
(The Regency at Glen Cove) Ser 92B ETM
Zero coupon, 10/15/19 13,510 7,188,131
Grand Central Dist Mgmt Assn Inc
Ser 04-394
6.69%, 1/01/12(a) 1,785 2,061,621
Hempstead Hgr Ed
(Adelphi Univ) Ser 02
5.50%, 6/01/32 1,000 1,069,980
Herkimer Cnty IDR Hgr Ed
(Herkimer CC Stud Hsg) Ser 00
6.50%, 11/01/30 2,000 2,223,000
_______________________________________________________________________________
34 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
New York Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Horseheads CCRC
(Appleridge Retrmt Cmnty) GNMA Ser 99
5.75%, 9/01/41 $ 4,000 $ 4,296,280
Long Island Power Auth Elec Rev
FSA Ser 01A
5.25%, 9/01/28 10,000 10,566,000
Monroe Cnty MFHR
(Southview Towers Proj) Sonyma Ser 00 AMT
6.25%, 2/01/31 1,130 1,249,136
Montgomery Cnty IDA Lease Rev
(HFM Boces) XLCA Ser 05A
5.00%, 7/01/24 1,500 1,583,370
New York City Cultural Resources
(Museum American Folk Art) ACA Ser 00
6.125%, 7/01/30 2,000 2,185,120
(Museum of Modern Art) AMBAC Ser 01D
5.125%, 7/01/31 14,000 14,721,980
New York City Ed Fac
(Lycee Francais) ACA Ser 02C
6.80%, 6/01/28 2,500 2,611,250
(Magen David Yeshivah Proj) ACA Ser 02
5.70%, 6/15/27 2,500 2,677,725
(Spence School)
5.20%, 7/01/34 3,155 3,338,148
New York City GO
FSA Ser 04E
5.00%, 11/01/21 4,000 4,296,960
Ser 01B Prerefunded
5.50%, 12/01/31 8,430 9,560,547
Ser 01B Unrefunded
5.50%, 12/01/31 3,570 3,827,754
Ser 03
5.75%, 3/01/15-3/01/17 4,250 4,781,298
Ser 04G
5.00%, 12/01/23 3,225 3,379,897
Ser 04I
5.00%, 8/01/21 11,400 11,984,820
Ser 05J
5.00%, 3/01/24 12,000 12,558,840
Ser 96A Prerefunded
6.25%, 8/01/17 15,500 16,395,435
Ser 96J
6.00%, 2/15/24 110 113,977
Ser 96J Prerefunded
6.00%, 2/15/24 11,090 11,542,028
XLCA Ser 04-1249
6.77%, 8/01/18(a) 5,000 5,773,700
New York City HDC MFHR
(Rental Hsg) Ser 01C-2 AMT
5.40%, 11/01/33 3,030 3,038,878
(Rental Hsg) Ser 02A AMT
5.50%, 11/01/34 1,250 1,293,200
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 35
New York Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
New York City Hlth & Hosp Rev
AMBAC Ser 03A
5.25%, 2/15/22 $ 5,000 $ 5,389,800
New York City Hosp Rev
(Health Sys) FSA Ser 02A
5.125%, 2/15/23 1,500 1,588,305
New York City IDA
(Brooklyn Navy Yard) Ser 97 AMT
5.75%, 10/01/36 3,000 2,949,420
New York City IDA Spl Fac
(Airis JFK Proj) Ser 01A
5.50%, 7/01/28 9,000 9,014,040
(British Airways) Ser 98 AMT
5.25%, 12/01/32 1,175 1,002,204
New York City IDR Spl Fac
(Terminal One) Ser 94 AMT
6.125%, 1/01/24 18,690 18,999,880
New York City Mun Wtr Fin Auth
Ser 03A
5.00%, 6/15/27 1,000 1,048,170
Ser 04-401
10.10%, 12/15/11(a) 260 343,439
New York City TFA
MBIA Ser 04-478
11.12%, 2/01/11(a) 2,500 3,429,000
Ser 00B Prerefunded
6.00%, 11/15/29 6,000 6,880,200
Ser 02A
5.50%, 11/01/26 5,000 5,536,450
New York State
Tobacco Settlement Bonds Ser 03-1156
7.64%, 6/01/14(a) 2,500 2,922,050
New York State Dorm Auth
(FHA Insd Maimonides) MBIA Ser 04
5.75%, 8/01/29(b) 3,515 3,986,115
Ser 02
5.00%, 7/01/32 4,000 4,422,160
New York State Dorm Auth Hlth Fac
(Eger Rehab Ctr) FHA Ser 00
6.10%, 8/01/37 3,930 4,455,873
(Nursing Home) FHA Ser 02-34
5.20%, 2/01/32 3,965 4,223,558
New York State Dorm Auth Hosp Rev
(Mem Sloan-Kettering Ctr) MBIA Ser 03A
5.00%, 7/01/22 5,000 5,302,000
(Mount Sinai) NYU Health System Ser 00
6.50%, 7/01/25 7,500 7,900,200
New York State Dorm Auth Lease Rev
(Master Boces Program Wayne Finger)
FSA Ser 04
5.00%, 8/15/23 3,175 3,378,391
_______________________________________________________________________________
36 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
New York Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
New York State Dorm Auth MFHR
(Joachim & Anne Residence) Ser 02
5.25%, 7/01/27 $ 1,000 $ 1,036,730
New York State Dorm Auth Rev
(Leake & Watts Svcs Inc) MBIA Ser 04
5.00%, 7/01/22-7/01/23 3,275 3,493,746
(Montefiore Hosp) FGIC/FHA Ser 04
5.00%, 8/01/23 5,000 5,312,650
(New York University) FGIC Ser 04A
5.00%, 7/01/24 2,240 2,381,971
(Rochester University) Ser 04A
5.25%, 7/01/21-7/01/24 1,825 1,984,886
New York State Energy Res & Dev Auth
(Brooklyn Union Gas) MBIA AMT
8.775%, 7/08/26(a) 6,000 6,043,860
New York State Energy Res & Dev Auth Elec Rev
(Long Island Ltg Co) Ser 95A AMT
5.30%, 8/01/25 7,500 7,780,650
New York State Energy Res & Dev Auth PCR
(NYS Elec & Gas) MBIA Ser 87A AMT
6.15%, 7/01/26 15,000 15,377,250
New York State Env Solid Waste Disp Rev
(Waste Mgmnt Proj) Ser 02A
2.90%, 5/01/12 3,500 3,475,675
New York State Metro Trans Auth
MBIA Ser 04-1257
7.77%, 7/01/11(a) 5,000 6,400,600
Ser 02
5.25%, 11/15/31 5,000 5,273,150
Ser 02A
5.125%, 11/15/31 5,500 5,738,865
Ser 02A
5.25%, 11/15/30 10,000 10,592,300
New York State Mtg Agy SFMR
(Mtg Rev) Ser 01-31A AMT
5.30%, 10/01/31 9,000 9,150,030
(Mtg Rev) Ser 82 AMT
5.65%, 4/01/30 3,940 4,020,337
Ser 01-29 AMT
5.45%, 4/01/31 9,000 9,176,580
Ser 84 AMT
5.95%, 4/01/30 18,270 19,080,457
New York State Twy Auth
Personal Income Tax Rev
(Transport) AMBAC Ser 04A
5.00%, 3/15/24 5,000 5,322,750
New York State UDC Spl Tax
(Empire State) Ser 02A
5.25%, 3/15/32 3,945 4,416,467
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 37
New York Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Niagara Frontier Trans Arpt Rev
(Buffalo Niagara) MBIA AMT
5.625%, 4/01/29 $ 2,500 $ 2,640,000
Onondaga Cnty IDR Swr Rev
(Anheuser Busch) Ser 99 AMT
6.25%, 12/01/34 2,000 2,181,120
Onondaga Cnty PCR
(Bristol-Myers Squibb) AMT
5.75%, 3/01/24 4,000 4,574,920
Onondaga County IDA Arpt Fac
(Cargo ACQ Grp) Ser 02 AMT
6.125%, 1/01/32 1,000 1,036,680
Port Auth of NY & NJ
(JFK Int'l Proj) MBIA Ser 97-6 AMT
5.75%, 12/01/22(c) 6,820 7,345,617
Ser 03 AMT
6.58%, 12/15/12(a) 4,500 5,073,750
Spencerport Uni Sch Dist
MBIA Ser 02
5.00%, 6/15/21 2,500 2,648,200
Staten Island Hosp Rev
(Staten Island Hosp) Ser 01B
6.375%, 7/01/31 1,985 1,987,164
Suffolk County IDR
(Nissequogue Cogen Fac) Ser 98 AMT
5.50%, 1/01/23 5,750 5,664,843
Yonkers IDA Hlth Fac
(Malotz Pavilion Proj) MBIA Ser 99
5.65%, 2/01/39 700 748,279
-------------
410,190,045
-------------
Ohio-0.3%
Port Auth of Columbiana Cnty SWR
(Apex Environmental Llc) Ser 04A AMT
7.125%, 8/01/25 1,200 1,214,412
-------------
Puerto Rico-2.8%
Puerto Rico Commonwealth
MBIA Ser 04-441
12.95%, 1/01/09(a) 375 545,145
Puerto Rico Elec Pwr Auth
XLCA Ser 02-1
5.25%, 7/01/22(c) 10,000 10,891,800
Puerto Rico HFC SFMR
(Mtg Rev) Ser 01A
5.20%, 12/01/33 1,820 1,859,439
-------------
13,296,384
-------------
Texas-0.4%
Houston Arpt Rev
(Continental Airlines) Ser 01E AMT
7.00%, 7/01/29 2,050 1,830,835
-------------
_______________________________________________________________________________
38 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
New York Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Virginia-0.8%
Bell Creek CDD
Ser 03A
6.75%, 3/01/22 $ 839 $ 871,855
Broad Str Parking Fac
Ser 03
7.50%, 6/01/33 2,680 2,798,376
-------------
3,670,231
-------------
Total Investments-99.8%
(cost $439,611,927) 467,060,957
Other assets less liabilities-0.2% 873,377
-------------
Net Assets-100% $ 467,934,334
=============
INTEREST RATE SWAP TRANSACTIONS (see Note D)
Rate Type
-------------------------------
Payments Payments
Notional made received Unrealized
Swap Amount Termination by the by the Appreciation/
Counterparty (000) Date Portfolio Portfolio (Depreciation)
- ---------------------------------------------------------------------------------------------------
Goldman Sachs $ 27,300 2/03/06 76.48% of BMA* $ (16,729)
1 Month LIBOR**
J.P. Morgan 2,500 6/08/05 1.25% BMA* 4,749
J.P. Morgan 5,000 6/13/05 1.245% BMA* 14,443
J.P. Morgan 4,300 4/05/07 BMA* 2.988% 8,738
J.P. Morgan 4,500 6/15/15 3.777% BMA* (97,956)
Merrill Lynch 1,025 10/04/05 BMA* 3.745% 3,282
Merrill Lynch 6,500 12/01/05 BMA* 2.22% (13,843)
Merrill Lynch 27,300 2/03/06 BMA* 85.10% of 83,844
1 Month LIBOR**
* BMA (Bond Market Association)
** LIBOR (London Interbank Offered Rate)
(a) Inverse floater security--security with variable or floating interest rate
that moves in opposite direction of short-term interest rates.
(b) Represents entire or partial position segregated as collateral for when
issued security.
(c) Represents entire or partial position segregated as collateral for
interest rate swap.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 39
New York Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Glossary of Terms:
ACA - American Capital Access Financial Guaranty Corporation
AMBAC - American Municipal Bond Assurance Corporation
AMT - Alternative Minimum Tax--(subject to)
CCRC - Congregate Care Retirement Center
CDD - Community Development District
CFD - Community Facilities District
ETM - Escrow to Maturity
FGIC - Financial Guaranty Insurance Company
FHA - Federal Housing Administration
FSA - Financial Security Assurance Inc.
GNMA - Government National Mortgage Association
GO - General Obligation
HDC - Housing Development Corporation
HFC - Housing Finance Corporation
IDA - Industrial Development Authority/Agency
IDR - Industrial Development Revenue
MBIA - Municipal Bond Investors Assurance
MFHR - Multi-Family Housing Revenue
PCR - Pollution Control Revenue
SFMR - Single Family Mortgage Revenue
SWR - Solid Waste Revenue
TFA - Transitional Finance Authority
UDC - Urban Development Corporation
XLCA - XL Capital Assurance Inc.
See notes to financial statements.
_______________________________________________________________________________
40 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
CALIFORNIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 2005 (unaudited)
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
MUNICIPAL BONDS-98.1%
Long-Term Municipal Bonds-97.6%
California-96.9%
Bassett Uni Sch Dist
(Election of 2004) Ser 05A FSA
5.00%, 8/01/23-8/01/25 $ 3,255 $ 3,488,360
Brentwood Fin Auth
Ser 02
6.125%, 9/02/32 4,990 5,260,059
California Dept of Wtr Res
AMBAC Ser 02A
5.50%, 5/01/14 1,340 1,509,229
FGIC Ser 02A
5.125%, 5/01/18 10,000 10,819,600
Ser 02A
5.375%, 5/01/21 3,000 3,249,240
California Dept Transp Rev
FGIC Ser 04A
5.00%, 2/01/13 10,000 11,066,200
California Eco Recov
(Rols II-R 326) MBIA Ser 05
8.723%, 7/01/12(a) 2,335 3,083,764
California Ed Facs Auth Rev
(University of Pacific) Ser 04
5.00%, 11/01/20 1,000 1,053,280
5.25%, 5/01/34 1,000 1,068,570
California GO
5.00%, 2/01/32 13,200 13,621,872
5.125%, 6/01/31 1,730 1,803,663
5.25%, 2/01/30 14,000 14,720,020
MBIA-IBC Ser 03
5.25%, 2/01/16 2,050 2,275,193
MBIA Ser 02
5.00%, 2/01/32 3,500 3,635,625
Ser 02
5.25%, 4/01/30 1,175 1,236,758
Ser 03
5.25%, 2/01/24 3,500 3,748,535
Ser 04
5.00%, 2/01/33 6,925 7,152,278
5.125%, 2/01/28 3,500 3,664,150
5.30%, 4/01/29 6,400 6,849,664
California Health Fac Auth
(Cottage Hlth Sys) MBIA Ser 03B
5.00%, 11/01/23 2,500 2,643,425
(Lucile Salter Packard Hosp) AMBAC Ser 03C
5.00%, 8/15/21 3,365 3,573,193
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 41
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
California HFA SFMR
(Mtg Rev) FHA Ser 95A-2 AMT
6.45%, 8/01/25 $ 860 $ 870,251
(Mtg Rev) Ser 99A-2 AMT
5.25%, 8/01/26 2,920 2,945,141
California Hgr Ed
(Col of Arts & Crafts) Ser 01
5.875%, 6/01/30 2,200 2,337,522
California Infra & Eco Dev Bank
(American Ctr/Wine Food & Art) ACA Ser 99
5.80%, 12/01/29 3,465 3,661,327
Ser 04-407
10.13%, 4/01/12(a) 2,485 3,233,581
California Poll Ctl Fin Auth
(Pacific Gas & Elec) MBIA Ser 96A AMT
5.35%, 12/01/16 15,500 16,853,305
(So Calif Edison) MBIA Ser 99C AMT
5.55%, 9/01/31 7,950 8,407,205
(So Calif Edison) Ser 92B AMT
6.40%, 12/01/24 9,280 9,310,902
(So Calif) Ser 86A
2.00%, 2/28/08 5,000 4,954,650
(Tracy Material Recovery) ACA Ser 99A AMT
5.70%, 8/01/14 3,670 3,830,452
California Poll Ctl Fin Auth SWR
(Waste Management) Ser 02A AMT
3.125%, 1/01/22 15,000 14,928,300
California Pub Wks Bd Lease Rev
(Coalinga) Ser 04A
5.50%, 6/01/22-6/01/23 6,790 7,346,679
(Dept of Hlth Svcs-Richmond Lab)
Ser 05B XLCA
5.00%, 11/01/30 1,270 1,321,562
(Various Univ Calif Projs) Ser 04F
5.00%, 11/01/26 8,065 8,437,119
XLCA Ser 04-413
6.70%, 12/01/11(a) 10,070 11,732,960
California Rural MFA SFMR
(Mtg Rev) GNMA/FNMA Ser 00B AMT
6.25%, 12/01/31 345 348,574
(Mtg Rev) GNMA/FNMA Ser 00D AMT
6.00%, 12/01/31 1,140 1,200,933
(Mtg Rev) GNMA/FNMA Ser 99A AMT
5.40%, 12/01/30 700 714,847
(Mtg Rev) MBIA Ser 99A AMT
5.40%, 12/01/30 1,725 1,765,710
California State University Rev
FGIC Ser 03A
5.00%, 11/01/22 6,000 6,381,600
_______________________________________________________________________________
42 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
California Statewide Comm Dev Auth
(Kaiser Hosp) Ser 01A
5.55%, 8/01/31 $18,000 $ 19,122,480
(San Diego Space & Science) Ser 96
7.50%, 12/01/16 2,715 2,936,354
California Statewide Comm Dev Auth COP
(Eskaton Properties) Ser 99 ACA
4.70%, 5/15/29(a) 250 250,000
California Statewide Comm Dev Auth Ed Fac
(Drew College Prep) Ser 00
7.25%, 10/01/30 8,000 8,709,600
(Saint Mark's Sch) Ser 01
6.75%, 6/01/28 2,555 2,703,165
(Sonoma Cntry Day Sch) Ser 99
6.00%, 1/01/29 11,540 12,316,065
(Wildwood Elem Sch) Ser 01
7.00%, 11/01/29 4,000 4,263,880
(Windward Sch) Ser 99
6.90%, 9/01/23 2,000 2,068,420
California Statewide Comm Dev Auth Rev
(Daughters of Charity Health) Ser 05A
5.25%, 7/01/24 3,225 3,412,179
California Statewide MFHR
(Highland Creek Apts) FNMA Ser 01K AMT
5.40%, 4/01/34 5,745 5,976,868
(Santa Paula Vlg Apt) FNMA Ser 98D AMT
5.43%, 5/01/28 2,090 2,133,201
California Veterans Hsg
AMBAC Ser 02A
5.35%, 12/01/27(b) 22,320 23,284,670
Carson Assmt Dist
(Dominguez Tech Ctr) Ser 01-1
6.35%, 9/02/23 3,825 3,983,087
6.375%, 9/02/31 5,000 5,206,900
Castaic Lake Wtr Agy
AMBAC Ser 04A
5.00%, 8/01/16-8/01/18 4,325 4,698,459
MBIA Ser 01A
5.20%, 8/01/30 1,625 1,716,504
Chino CFD
(Spectrum South) Ser 99
6.35%, 9/01/29 3,450 3,536,630
Chino Hills CFD
(Fairfield Ranch) Ser 00
6.95%, 9/01/30 5,200 5,592,340
Commerce Joint Pwrs Fin Auth Lease Rev
(Cmnty Ctr Proj) Ser 04 XLCA
5.00%, 10/01/34 2,015 2,097,776
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 43
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Corona CFD
(Eagle Glen) Ser 98
5.875%, 9/01/23 $ 3,260 $ 3,350,269
(Eagle Glen) Ser 98 ETM
5.875%, 9/01/23 3,100 3,185,839
Eastern Wtr CFD
(Morningstar Ranch) Ser 02
6.40%, 9/01/32 3,815 3,898,396
El Centro Fin Auth Hosp Rev
(El Centro Med Ctr) Ser 01
5.375%, 3/01/26 18,000 19,019,880
Elk Grove Assmt Dist
(E. Franklin Cmnty) Ser 02
5.80%, 8/01/25 1,000 1,034,290
6.00%, 8/01/33 5,000 5,193,600
Encinitas Rec Rev
(Encinitas Ranch Golf Course) Ser 04
5.50%, 9/01/23-9/01/24 1,110 1,114,801
5.60%, 9/01/26 1,000 1,005,680
(Encinitas Ranch Golf Course) Ser 96A
7.75%, 9/01/26 9,920 10,480,282
Fontana
(Heritage West End) Ser 99A
6.50%, 9/01/28 8,800 9,282,592
Fontana Pub Fin Auth
(No Fontana Redev Proj) AMBAC Ser 03A
5.50%, 9/01/32 1,000 1,087,900
Fresno Joint Pwrs Lease Rev
XLCA Ser 04A
5.25%, 10/01/21-10/01/24 3,425 3,715,026
5.375%, 10/01/17 1,315 1,465,383
Gilroy Uni Sch Dist
FGIC
5.00%, 8/01/27 1,500 1,579,575
Huntington Park Pub Fin Auth Rev
FSA Ser 04A
5.25%, 9/01/17 1,000 1,130,360
Kaweah Delta Health Care Dist
MBIA Ser 04
5.25%, 8/01/25-8/01/26 3,780 4,085,363
Kern Cnty
(Tejon Industrial Complex) Ser 00A
7.20%, 9/01/30 9,925 10,361,005
La Verne Spl Tax
Ser 98
5.875%, 3/01/14 5,225 5,448,003
Lammersville Sch Dist CFD
(Mountain House) Ser 02
6.375%, 9/01/32 4,250 4,485,748
_______________________________________________________________________________
44 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Lancaster Redev Agy Tax Alloc
(Fire Protn Fac Proj) XLCA Ser 04
5.00%, 12/01/23 $ 1,120 $ 1,186,383
(Sheriffs Fac Proj) XLCA Ser 04
5.00%, 12/01/23 1,875 1,986,131
Long Beach Bond Fin Auth Rev
(Redev Hsg & Gas Utility Fin)
Ser 05A-1 AMBAC
5.00%, 8/01/25 1,890 2,004,988
Los Angeles Cmnty Redev Agy
Ser 04L
5.00%, 3/01/17 2,565 2,629,920
5.10%, 3/01/19 1,350 1,381,374
Los Angeles Cnty Arpt
(Ontario Int'l Arpt) FGIC Ser 96A AMT
6.00%, 5/15/22 12,780 13,213,242
Los Angeles Cnty Pub Works
AMBAC Ser 97V- B
5.125%, 12/01/29 3,400 3,637,184
Los Angeles Cnty Pub Works Fin Auth Lease Rev
(Master Ref Proj) Ser 05A MBIA
5.00%, 12/01/28 7,285 7,682,761
Los Angeles Cnty Transp Auth
FGIC Ser 00A
5.25%, 7/01/30 2,750 2,985,290
Los Angeles Cmnty College Dist
(Election of 2001) Ser 05A FSA
5.00%, 8/01/24 4,500 4,820,085
Los Angeles Cmnty Redev MFHR
(Grand Ctrl Proj) Ser 93A AMT
5.85%, 12/01/26 4,030 4,032,257
Los Angeles Dept of Wtr & Pwr Elec Rev
MBIA Ser 01A
5.00%, 7/01/24 1,500 1,593,390
Los Angeles Harbor Rev
MBIA Ser 96B AMT
6.20%, 8/01/25 10,000 10,451,600
Ser 96B AMT
5.375%, 11/01/23 8,250 8,503,770
Los Angeles MFHR
(Park Plaza West) GNMA AMT
5.50%, 1/20/43 5,000 5,210,700
Los Angeles Uni Sch Dist
MBIA Ser 03A-1116
7.50%, 7/01/16(a) 4,850 6,071,909
Manteca Uni Sch Dist
FSA Ser 04
5.25%, 8/01/22 1,390 1,524,177
Marin Wtr Dist Rev
AMBAC Ser 04
5.25%, 7/01/20 3,040 3,343,514
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 45
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Natomas Uni Sch Dist
(Election of 2002) Ser 04B FGIC
5.00%, 9/01/27-9/01/28 $ 6,030 $ 6,382,013
Norco Redev Agy Tax Alloc
(Norco Redev Proj #1) Radian Ser 04
5.00%, 3/01/24 3,060 3,138,826
Novato CFD
(Hamilton Field) Ser 95
7.375%, 9/01/25 10,135 10,492,563
Ontario Assmt Dist
(Calif Commerce Ctr So)
7.70%, 9/02/10 4,835 4,966,705
Ontario COP
(Wtr Sys Impt Proj) MBIA Ser 04
5.25%, 7/01/21 1,700 1,862,894
Orange Cnty CFD
(Ladera Ranch) Ser 99A
6.70%, 8/15/29 3,000 3,484,860
Orange Cnty Sr Lien
(Foothill/Eastern Corr) Ser 95 ETM
Zero coupon, 1/01/24-1/01/25 25,225 10,414,530
(San Joaquin Hills Transp Corr) MBIA
Zero coupon, 1/15/36 62,415 12,947,992
(San Joaquin Hills Transp Corr) Ser 93 ETM
Zero coupon, 1/01/17-1/01/23 91,000 46,417,200
Palm Springs Arpt Rev
(Palm Springs Regional Arpt) MBIA Ser 92 AMT
6.00%, 1/01/22 6,860 6,895,535
Palm Springs COP
Ser 91B ETM
Zero coupon, 4/15/21 37,500 17,857,500
Palmdale Wtr Dist Rev COP
FGIC Ser 04
5.00%, 10/01/24 1,775 1,885,778
Pittsburg Redev Agy
(Los Medanos Proj) Ser 03A
5.00%, 8/01/21 6,410 6,828,060
Port of Oakland
FGIC Ser 02L AMT
5.375%, 11/01/27 2,500 2,644,325
Rancho Cordova CFD
(Sunridge Anatolia) Ser 03
6.00%, 9/01/28 2,000 2,103,720
Riverside CFD
(MTN Cove) Ser 00
6.50%, 9/01/25 3,390 3,570,551
Riverside Cmnty College Dist
Ser 04A
5.25%, 8/01/25-8/01/26 2,000 2,170,520
_______________________________________________________________________________
46 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Riverside Cnty Pub Fin Auth Tax Alloc
(Redev Proj) Ser 04 XLCA
5.00%, 10/01/35 $ 2,475 $ 2,567,045
Rocklin Uni Sch Dist
MBIA Ser 04
5.00%, 9/01/25 1,000 1,058,540
Roseville CFD
(No Central Roseville Highland Park) Ser 99-A
5.80%, 9/01/17 6,685 7,046,926
Roseville COP
AMBAC Ser 03A
5.00%, 8/01/25 7,490 7,897,980
Roseville High Sch Dist
Ser 01E
5.25%, 8/01/26 2,435 2,606,570
Sacramento CFD
(N Natomas Drain) Ser 00B
7.25%, 9/01/30 5,375 5,699,650
Sacramento City Uni Sch Dist
FSA Ser 04D
5.25%, 7/01/21-7/01/23 8,525 9,306,569
Sacramento Cnty Arpt Rev
MBIA Ser 96A AMT
5.90%, 7/01/24 5,050 5,355,424
Sacramento Cnty Hsg Auth MFHR
(Cottage Estates) FNMA Ser 00B AMT
6.00%, 2/01/33 5,300 5,648,740
(Verandas Apts) FNMA Ser 00H AMT
5.70%, 3/01/34 2,875 3,006,100
Sacramento Muni Util Dist Elec Rev
MBIA Ser 03S
5.00%, 11/15/17 5,000 5,429,800
MBIA Ser 04R-289-2
10.56%, 8/15/17(a) 2,500 3,337,700
San Bernardino Cnty CFD
(Kaiser Commerce Cntr) Ser 02-1
5.90%, 9/01/33 4,750 4,797,025
(Rancho Etiwanda) Ser 01
6.40%, 9/01/31 8,000 8,348,880
(Rancho Etiwanda) Ser 01 ETM
6.40%, 9/01/31 3,145 3,282,153
San Bernardino SFMR
(Mtg Rev) GNMA/FNMA Ser 01-A1 AMT
6.35%, 7/01/34 865 875,242
San Diego Cnty COP
Ser 04A
5.50%, 9/01/44 5,000 5,283,400
San Diego HFA MFHR
(Rental Rev) GNMA/FNMA Ser 98C AMT
5.25%, 1/20/40 6,105 6,231,190
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 47
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
San Diego Hsg Auth MFHR
(Vista La Rosa Apt) GNMA Ser 00A AMT
6.00%, 7/20/41 $10,230 $ 10,893,006
San Diego Uni Sch Dist
(Election of 1998) MBIA Ser 04E-1
5.00%, 7/01/23-7/01/24 2,240 2,415,283
San Francisco City & Cnty Int'l Arpt
(Issue 10A) MBIA Second Ser 96 AMT
5.70%, 5/01/26(c) 9,385 9,803,477
FSA Ser 00A AMT
6.125%, 1/01/27 1,480 1,582,401
San Francisco Univ Ed Fac
ACA Ser 99
5.25%, 7/01/32 16,650 17,033,450
San Jose MFHR
(Fallen Leaves Apts) AMBAC AMT
5.15%, 6/01/36 1,400 1,434,328
San Jose Redev Agy Tax Alloc
MBIA Ser 04A
5.25%, 8/01/19 5,000 5,527,450
San Mateo Cnty Cmnty College Dist COP
MBIA Ser 04
5.25%, 10/01/20 2,870 3,174,966
San Mateo Uni Sch Dist
FSA Ser 04
5.00%, 9/01/24 2,000 2,131,820
Santa Margarita Wtr Fac Dist
(Talega) Ser 99
6.25%, 9/01/29 11,550 12,351,570
Semitropic Impt Dist Wtr Storage
XLCA Ser 04A
5.50%, 12/01/23 1,640 1,835,422
So Calif HFA SFMR
(Mtg Rev) GNMA/FNMA Ser 92A AMT
6.75%, 9/01/22 55 55,063
So Tahoe Joint Pwr Fin Auth
Ser 95A
5.75%, 10/01/25 3,000 3,102,060
Solano Cnty Cmnty College Dist
Ser 05 MBIA
5.00%, 8/01/22 1,100 1,185,866
South Gate Pub Fin Auth
(South Gate Redev Proj #1) XLCA Ser 02
5.125%, 9/01/24 1,800 1,921,536
Tejon Ranch CFD
Ser 03
6.125%, 9/01/27 1,000 1,021,120
6.20%, 9/01/33 2,375 2,422,666
Torrance COP
(Ref & Pub Imprt Proj) AMBAC Ser 05B
5.00%, 6/01/24 2,900 3,075,711
_______________________________________________________________________________
48 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Univ of Calif Regents Hgr Ed
FGIC Ser 01M
5.125%, 9/01/30 $12,270 $ 12,925,954
West Contra Costa Healthcare Dist COP
AMBAC Ser 04
5.375%, 7/01/21-7/01/24 4,720 5,160,282
West Kern Cnty Wtr Rev
Ser 01
5.625%, 6/01/31 3,000 3,162,870
Westminster Redev Agy MFHR
(Rose Garden Apt) Ser 93A AMT
6.75%, 8/01/24 4,300 4,377,142
Yorba Linda Rec Rev
(Black Gold Golf Proj) Ser 00
7.50%, 10/01/30 5,680 6,542,565
-------------
848,275,057
-------------
Florida-0.2%
Ft Lauderdale Arpt Fac
(Cargo Acq Grp) Ser 03 AMT
5.75%, 1/01/32 1,500 1,501,635
-------------
Ohio-0.3%
Port Auth of Columbiana Cnty SWR
(Apex Environmental Llc) Ser 04A AMT
7.125%, 8/01/25 2,000 2,024,020
-------------
Texas-0.2%
Richardson Texas Hosp Auth
(Richardson Regional) Ser 04
6.00%, 12/01/19 1,715 1,888,592
-------------
Total Long-Term Municipal Bonds
(cost $788,222,876) 853,689,304
-------------
Short-Term Municipal Notes(d)-0.5%
California-0.5%
California Dept of Wtr Res
Ser 02B-3
3.00%, 5/01/22 4,600 4,600,000
-------------
Illinois-0.0%
Illinois Dev Fin Auth PCR
(Illinois Pwr Proj) AMBAC Ser 01
2.70%, 11/01/28 100 100,000
-------------
Total Short-Term Municipal Notes
(cost $4,700,000) 4,700,000
-------------
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 49
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Value
- -------------------------------------------------------------------------------
Total Investments-98.1%
(cost $792,922,876) $ 858,389,304
Other assets less liabilities-1.9% 16,742,783
-------------
Net Assets-100% $ 875,132,087
=============
INTEREST RATE SWAP TRANSACTIONS (see Note D)
Rate Type
-------------------------------
Payments Payments
Notional made received Unrealized
Swap Amount Termination by the by the Appreciation/
Counterparty (000) Date Portfolio Portfolio (Depreciation)
- -------------------------------------------------------------------------------------------------------
Goldman Sachs $52,700 2/03/06 76.48% of BMA* $ (32,293)
1 Month LIBOR**
Goldman Sachs 5,000 3/01/06 2.25% BMA* 15,786
J.P. Morgan 7,300 6/08/05 1.25% BMA* 13,868
J.P. Morgan 15,065 7/08/05 1.257% BMA* 47,648
J.P. Morgan 8,400 5/05/07 BMA* 2.988% 17,069
J.P. Morgan + 14,900 11/05/24 4.419% BMA* (382,736)
Merrill Lynch 4,300 10/04/05 BMA* 3.758% 18,344
Merrill Lynch 52,700 2/03/06 BMA* 85.10% of 161,852
1 Month LIBOR**
Merrill Lynch ++ 17,000 11/01/19 3.896% BMA* (201,880)
* BMA (Bond Market Association)
** LIBOR (London Interbank Offered Rate)
+ Represents a forward interest rate swap whose effective date for the
exchange of cash flows is May 5, 2005.
++ Represents a forward interest rate swap whose effective date for the
exchange of cash flows is May 1, 2005.
FINANCIAL FUTURES CONTRACTS (see Note D)
Value at Unrealized
Number of Expiration Original April 30, Appreciation/
Type Contracts Month Value 2005 (Depreciation)
- ----------------------------------------------------------------------------------------------------
Purchase Contracts
U.S. T-Bond
Future 117 June 2005 $13,247,033 $13,436,719 $ 189,686
Sold Contracts
U.S. T-Note
10 Yr Future 161 June 2005 17,776,061 17,938,922 (162,861)
Swap
10 Yr Future 183 June 2005 20,083,564 20,215,781 (132,217)
-----------
$ (105,392)
===========
_______________________________________________________________________________
50 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
(a) Inverse floater security--security with variable or floating interest rate
that moves in opposite direction of short-term interest rates.
(b) Represents entire or partial position segregated as collateral for
interest rate swap.
(c) Position, or portion thereof, with a market value of $1,478,095 has been
segregated to collaterize margin requirements for open futures contracts.
(d) Variable Rate Demand Notes ( VRDN ) are instruments whose interest rates
change on a specific date ( such as coupon date or interest payment date ) or
whose interest rates vary with changes in a designated base rate ( such as the
prime interest rate ). This instrument is payable on demand and is secured by
letters of credit or other credit support agreements from major banks.
Glossary of Terms:
ACA - American Capital Access Financial Guaranty Corporation
AMBAC - American Municipal Bond Assurance Corporation
AMT - Alternative Minimum Tax--(subject to)
CFD - Community Facilities District
COP - Cerificate of Participation
ETM - Escrow to Maturity
FGIC - Financial Guaranty Insurance Company
FHA - Federal Housing Administration
FNMA - Federal National Mortgage Association
FSA - Financial Security Assurance Inc.
GNMA - Government National Mortgage Association
GO - General Obligation
HFA - Housing Finance Authority
MBIA - Municipal Bond Investors Assurance
MFA - Mortgage Finance Authority
MFHR - Multi-Family Housing Revenue
PCR - Pollution Control Revenue
SFMR - Single Family Mortgage Revenue
SWR - Solid Waste Revenue
XLCA - XL Capital Assurance Inc.
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 51
Insured California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
INSURED CALIFORNIA PORTFOLIO
PORTFOLIO OF INVESTMENTS
April 30, 2005 (unaudited)
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
MUNICIPAL BONDS-99.1%
Long-Term Municipal Bonds-94.7%
California-94.7%
California Dept Wtr Resources
AMBAC Ser 02A
5.50%, 5/01/14 $ 2,525 $ 2,843,882
California Eco Recov
(Rols II-R 326) MBIA Ser 05
8.72%, 7/01/12(a) 2,330 3,077,161
California GO
(Veterans Housing) FSA Ser 01
5.60%, 12/01/32 4,415 4,470,761
AMBAC Ser 03
5.00%, 2/01/33 1,000 1,045,260
Ser 02
5.25%, 2/01/30 2,000 2,102,860
California HFA MFHR
(Mtg Rev) AMBAC Ser 95A
6.25%, 2/01/37 5,000 5,145,700
California Infra & Eco Dev Bank
(American Ctr/Wine Food & Arts) ACA Ser 99
5.75%, 12/01/24 1,250 1,325,175
California Pub Wks Bd Lease Rev
(Dept of Hlth Svcs-Richmond Lab)
Ser 05B XLCA
5.00%, 11/01/30 3,000 3,121,800
Capistrano Uni Sch Dist
FGIC Ser 00A
6.00%, 8/01/24 1,550 1,740,588
FSA Ser 01B
Zero coupon, 8/01/20-8/01/25 24,465 10,092,296
Chino Redev Agy Spl Tax
AMBAC Ser 01A
5.13%, 9/01/30 1,000 1,049,160
AMBAC Ser 01B ETM
5.25%, 9/01/30 5,540 5,878,106
Coronado CDD
FSA Ser 96
6.00%, 9/01/26 6,450 6,817,134
Fontana Pub Fin Auth
(No Fontana Proj) AMBAC Ser 03A
5.50%, 9/01/32 4,200 4,569,180
Franklin-McKinley Sch Dist
FSA Ser 02B
5.00%, 8/01/27 700 737,135
Golden St
Tobacco Settlement Bonds Radian Ser 03
5.50%, 6/01/43 1,400 1,511,566
_______________________________________________________________________________
52 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Insured California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
Jurupa Uni Sch Dist
(Election 2001) FGIC Ser 04
5.00%, 8/01/22 $ 1,340 $ 1,427,395
La Mirada Tax Alloc
FSA Ser 95B
5.90%, 8/15/24 5,000 5,150,150
Lancaster Redev Agy MFHR
(High Valley Apts) FHA Ser 96A
6.00%, 6/01/27 4,170 4,256,736
Long Beach
(Aquarium of the Pacific Proj) AMBAC Ser 01
5.25%, 11/01/30(b) 6,500 6,941,545
Los Angeles Cnty Pub Wks Fin Auth Lease Rev
(Master Refunding Proj) Ser 05A MBIA
5.00%, 12/01/27 2,000 2,112,660
Los Angeles Dept of Wtr & Pwr
MBIA Ser 01A
5.00%, 7/01/24 5,900 6,267,334
Mojave Wtr Agy Imp Dist
(Morongo Basin Pipeline) FGIC Ser 96
5.80%, 9/01/22 10,000 10,575,800
Orange Cnty COP
(Loma Ridge Data Ctr Proj) AMBAC
6.00%, 6/01/21 1,000 1,181,060
Orange Cnty Recovery Certificates
MBIA Ser 96A
6.00%, 7/01/26 3,000 3,170,550
Perris Union High Sch Dist
Ser 05A FGIC
5.00%, 9/01/24 800 855,200
Poway Redev Agy
(Paguay Proj) AMBAC Ser 01 ETM
5.375%, 12/15/31 6,275 6,785,848
Redding Elec Sys Rev
MBIA Ser 92A
9.87%, 7/01/22(a) 2,000 2,863,260
Riverside Cnty Pub Fin Auth Tax Alloc Rev
(Redev Proj) XLCA Ser 04
5.00%, 10/01/23 1,955 2,070,775
Riverside Cnty Spl Tax
(Jurupa Valley) AMBAC Ser 01
5.13%, 10/01/35 5,000 5,248,700
(Jurupa Valley) AMBAC Ser 01 ETM
5.25%, 10/01/35(c) 8,000 8,554,480
Ross Valley Sch Dist
FSA Ser 01
Zero coupon, 7/01/26 3,530 1,241,572
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 53
Insured California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
Principal
Amount
(000) Value
- -------------------------------------------------------------------------------
San Diego Uni Port Dist Rev
MBIA Ser 04B
5.00%, 9/01/23 $ 1,035 $ 1,103,217
San Diego Uni Sch Dist
(Election 1998) MBIA Ser 04E-1
5.00%, 7/01/23 1,000 1,080,820
So Tahoe Joint Powers Auth
Fin Auth Ser 95A
5.75%, 10/01/25 1,500 1,551,030
Southwestern Cmnty College Dist
MBIA Ser 05
5.00%, 8/01/24 1,000 1,084,280
Torrance COP
(Ref & Pub Impt Proj) AMBAC Ser 05B
5.00%, 6/01/24 465 493,174
-------------
Total Long-Term Municipal Bonds
(cost $120,386,221) 129,543,350
-------------
Short-Term Municipal Notes (d)-4.4%
New York-4.4%
New York City Muni Wtr Fin Auth
Ser 95A FGIC
3.00%, 6/15/25 6,000 6,000,000
-------------
Total Short-Term Municipal Note
(cost $6,000,000) 6,000,000
-------------
Total Investments-99.1%
(cost $126,386,221) 135,543,350
Other assets less liabilities-0.9% 1,220,101
-------------
Net Assets-100% $ 136,763,451
=============
INTEREST RATE SWAP TRANSACTIONS (see Note D)
Rate Type
-------------------------------
Payments Payments
Notional made received Unrealized
Swap Amount Termination by the by the Appreciation/
Counterparty (000) Date Portfolio Portfolio (Depreciation)
- ------------------------------------------------------------------------------------------------------
Goldman Sachs $ 9,000 2/03/06 76.48% of BMA* $ (5,515)
1 Month LIBOR**
J.P. Morgan 1,300 5/05/07 BMA* 2.988% 2,642
J.P. Morgan + 700 11/05/24 4.149% BMA* (17,981)
Merrill Lynch 9,000 2/03/06 BMA* 85.10% of 27,641
1 Month LIBOR**
Merrill Lynch ++ 2,000 11/01/19 3.896% BMA* (23,751)
* BMA (Bond Market Association)
** LIBOR (London Interbank Offered Rate)
+ Represents a forward interest rate swap whose effective date for the
exchange of cash flows is May 5, 2005.
++ Represents a forward interest rate swap whose effective date for the
exchange of cash flows is May 1, 2005.
_______________________________________________________________________________
54 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Insured California Portfolio--Portfolio of Investments
- -------------------------------------------------------------------------------
FINANCIAL FUTURES CONTRACTS (see Note D)
Value at Unrealized
Number of Expiration Original April 30, Appreciation/
Type Contracts Month Value 2005 (Depreciation)
- ----------------------------------------------------------------------------------------------------
Purchased Contracts
U.S. T-Bond
Future 44 June 2005 $4,981,790 $5,053,125 $ 71,335
Sold Contracts
U.S. T-Note
10 Yr Future 63 June 2005 6,955,850 7,019,578 (63,728)
Swap
10 Yr Future 14 June 2005 1,536,448 1,546,563 (10,115)
----------
$ (2,508)
==========
(a) Inverse floater security--security with variable or floating interest rate
that moves in opposite direction of short-term interest rates.
(b) Position with a market value of $6,941,545 has been segregated to
collaterize margin requirements for open futures contracts.
(c) Represents entire or partial position segregated as collateral for
interest rate swap.
(d) Variable Rate Demand Notes (VRDN) are instruments whose interest rates
change on a specific date (such as coupon date or interest payment date) or
whose interest rates vary with changes in a designated base rate (such as the
prime interest rate). This instrument is payable on demand and is secured by
letters of credit or other credit support agreements from major banks.
Glossary of Terms:
ACA - American Capital Access Financial Guaranty Corporation
AMBAC - American Municipal Bond Assurance Corporation
CDD - Community Development District
COP - Cerificate of Participation
ETM - Escrow to Maturity
FGIC - Financial Guaranty Insurance Company
FHA - Federal Housing Administration
FSA - Financial Security Assurance Inc.
GO - General Obligation
HFA - Housing Finance Authority
MBIA - Municipal Bond Investors Assurance
MFHR - Multi-Family Housing Revenue
XLCA - XL Capital Assurance Inc.
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 55
Statement of Assets & Liabilities
- -------------------------------------------------------------------------------
STATEMENT OF ASSETS & LIABILITIES
April 30, 2005 (unaudited)
Insured
National National
============= =============
ASSETS
Investments in securities, at value
(cost $430,847,410 and $141,373,150
respectively) $ 455,633,227 $ 152,688,720
Cash -0- 83,133
Receivable for investment securities sold 14,467,604 4,999,031
Interest receivable 8,351,853 2,104,809
Receivable for capital stock sold 1,620,591 887,129
Unrealized appreciation of swap
contracts 142,041 40,131
Receivable for variation margin on
futures contracts -0- 6,468
------------- -------------
Total assets 480,215,316 160,809,421
============= =============
LIABILITIES
Due to custodian 67,256 -0-
Payable for investment securities
purchased 7,483,528 1,589,745
Payable for capital stock redeemed 2,001,172 330,693
Dividends payable 634,527 190,461
Distribution fee payable 195,541 58,988
Advisory fee payable 75,459 62,237
Unrealized depreciation of
swap contracts 33,598 109,421
Transfer Agent fee payable 30,665 2,889
Administrative fee payable 3,868 8,189
Accrued expenses 182,202 97,950
------------- -------------
Total liabilities 10,707,816 2,450,573
------------- -------------
Net Assets $ 469,507,500 $ 158,358,848
============= =============
COMPOSITION OF NET ASSETS
Capital stock, at par $ 46,058 $ 15,373
Additional paid-in capital 498,197,055 150,146,010
Undistributed/distributions in excess of
net investment income (677,503) 191,480
Accumulated net realized loss on
investment transactions (52,948,198) (3,242,345)
Net unrealized appreciation
of investments 24,890,088 11,248,330
------------- -------------
$ 469,507,500 $ 158,358,848
============= =============
_______________________________________________________________________________
56 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Statement of Assets & Liabilities
- -------------------------------------------------------------------------------
Insured
National National
============= =============
Class A Shares
Net assets $ 342,094,428 $ 126,615,826
============= =============
Shares of capital stock outstanding 33,550,063 12,285,582
============= =============
Class B Shares
Net assets $ 60,809,112 $ 19,777,897
============= =============
Shares of capital stock outstanding 5,970,350 1,924,012
============= =============
Class C Shares
Net assets $ 66,603,960 $ 11,965,125
============= =============
Shares of capital stock outstanding 6,537,308 1,163,394
============= =============
CALCULATION OF MAXIMUM OFFERING PRICE
Class A Shares
Net asset value and redemption price
per share $10.20 $10.31
Sales charge--4.25% of public offering
price .45 .46
------ ------
Maximum offering price $10.65 $10.77
====== ======
Class B Shares
Net asset value and offering price
per share $10.19 $10.28
====== ======
Class C Shares
Net asset value and offering price
per share $10.19 $10.28
====== ======
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 57
Statement of Assets & Liabilities
- -------------------------------------------------------------------------------
New York California
============= =============
ASSETS
Investments in securities, at value
(cost $439,611,927 and $792,922,876
respectively) $ 467,060,957 $ 858,389,304
Cash -0- 303,730
Interest receivable 7,362,362 11,402,230
Receivable for investment securities sold 5,623,280 7,121,058
Receivable for capital stock sold 1,480,242 4,234,558
Unrealized appreciation of swap
contracts 115,056 274,567
Receivable for variation margin on
futures contracts -0- 81,219
------------- -------------
Total assets 481,641,897 881,806,666
============= =============
LIABILITIES
Due to custodian 415,320 -0-
Payable for investment securities
purchased 9,859,730 -0-
Payable for capital stock redeemed 2,306,205 4,101,973
Dividends payable 619,584 1,101,432
Distribution fee payable 231,155 392,320
Unrealized depreciation of
swap contracts 128,528 616,909
Advisory fee payable 51,175 266,515
Transfer Agent fee payable 14,791 17,065
Administrative fee payable 7,511 7,950
Accrued expenses 73,564 170,415
------------- -------------
Total liabilities 13,707,563 6,674,579
------------- -------------
Net Assets $ 467,934,334 $ 875,132,087
============= =============
COMPOSITION OF NET ASSETS
Capital stock, at par $ 47,072 $ 79,566
Additional paid-in capital 458,762,585 839,615,618
Distributions in excess of
net investment income (380,938) (1,166,633)
Accumulated net realized loss on
investment transactions (17,893,280) (28,418,508)
Net unrealized appreciation
of investments 27,398,895 65,022,044
------------- -------------
$ 467,934,334 $ 875,132,087
============= =============
_______________________________________________________________________________
58 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Statement of Assets & Liabilities
- -------------------------------------------------------------------------------
New York California
============= =============
Class A Shares
Net assets $ 279,811,459 $ 591,714,956
============= =============
Shares of capital stock outstanding 28,135,158 53,793,799
============= =============
Class B Shares
Net assets $ 144,152,330 $ 150,057,346
============= =============
Shares of capital stock outstanding 14,512,708 13,645,860
============= =============
Class C Shares
Net assets $ 43,970,545 $ 133,359,785
============= =============
Shares of capital stock outstanding 4,424,356 12,126,646
============= =============
CALCULATION OF MAXIMUM OFFERING PRICE
Class A Shares
Net asset value and redemption price
per share $ 9.95 $11.00
Sales charge--4.25% of public offering
price .44 .49
------ ------
Maximum offering price $10.39 $11.49
====== ======
Class B Shares
Net asset value and offering price
per share $ 9.93 $11.00
====== ======
Class C Shares
Net asset value and offering price
per share $ 9.94 $11.00
====== ======
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 59
Statement of Assets & Liabilities
- -------------------------------------------------------------------------------
Insured
California
=============
ASSETS
Investments in securities, at value (cost $126,386,221) $ 135,543,350
Cash 248,159
Receivable for investment securities sold 4,480,376
Interest receivable 1,561,943
Receivable for capital stock sold 244,841
Unrealized appreciation of swap contracts 30,283
Receivable for variation margin on futures contracts 12,313
-------------
Total assets 142,121,265
=============
LIABILITIES
Payable for investment securities purchased 4,534,472
Payable for capital stock redeemed 419,599
Dividends payable 156,888
Distribution fee payable 57,056
Advisory fee payable 51,905
Unrealized depreciation of swap contracts 47,247
Transfer Agent fee payable 2,928
Administrative fee payable 3,345
Accrued expenses 84,374
-------------
Total liabilities 5,357,814
-------------
Net Assets $ 136,763,451
=============
COMPOSITION OF NET ASSETS
Capital stock, at par $ 9,611
Additional paid-in capital 126,076,713
Distributions in excess of net investment income (160,862)
Accumulated net realized gain on investment transactions 1,698,199
Net unrealized appreciation of investments 9,139,790
-------------
$ 136,763,451
=============
Class A Shares
Net assets $ 98,771,037
=============
Shares of capital stock outstanding 6,940,192
=============
Class B Shares
Net assets $ 18,813,575
=============
Shares of capital stock outstanding 1,322,560
=============
Class C Shares
Net assets $ 19,178,839
=============
SHARES OF CAPITAL STOCK OUTSTANDING 1,348,458
=============
Calculation of Maximum Offering Price
Class A Shares
Net asset value and redemption price per share $14.23
Sales charge--4.25% of public offering price .63
------
Maximum offering price $14.86
======
Class B Shares
Net asset value and offering price per share $14.23
======
Class C Shares
Net asset value and offering price per share $14.22
======
See notes to financial statements.
_______________________________________________________________________________
60 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Statement of Operations
- -------------------------------------------------------------------------------
STATEMENT OF OPERATIONS
Six Months Ended April 30, 2005 (unaudited)
Insured
National National
============= =============
INVESTMENT INCOME
Interest $ 12,729,149 $ 4,147,323
------------- -------------
EXPENSES
Advisory fee 1,066,592 361,359
Distribution fee--Class A 510,746 191,329
Distribution fee--Class B 334,970 105,968
Distribution fee--Class C 332,747 59,289
Transfer agency 196,691 59,051
Custodian 83,811 62,051
Printing 52,053 12,682
Administrative 34,500 34,500
Registration fees 23,822 25,085
Legal 16,254 20,545
Audit 8,625 21,866
Directors' fees and expenses 2,320 2,130
Miscellaneous 9,445 872
------------- -------------
Total expenses 2,672,576 956,727
Less: advisory fee waived (see Note B) (592,886) (5,747)
Less: expense offset arrangement
(see Note B) (549) (159)
------------- -------------
Net expenses 2,079,141 950,821
------------- -------------
Net investment income 10,650,008 3,196,502
------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENT TRANSACTIONS
Net realized gain (loss) on:
Investment transactions 1,807,740 847,065
Futures contracts -0- (118,350)
Swap contracts 51,594 14,962
Net change in unrealized
appreciation/depreciation of:
Investments 1,006,847 (592,495)
Futures contracts -0- 196,284
Swap contracts 5,176 (98,391)
------------- -------------
Net gain on investment transactions 2,871,357 249,075
------------- -------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 13,521,365 $ 3,445,577
============= =============
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 61
Statement of Operations
- -------------------------------------------------------------------------------
New York California
============= =============
INVESTMENT INCOME
Interest $ 12,434,763 $ 22,930,450
------------- -------------
EXPENSES
Advisory fee 1,056,338 1,994,653
Distribution fee--Class A 414,983 877,840
Distribution fee--Class B 742,134 819,646
Distribution fee--Class C 222,006 686,781
Transfer agency 155,020 191,824
Custodian 82,296 117,581
Administrative 34,500 34,500
Printing 24,353 47,606
Audit 21,833 21,590
Legal 15,892 31,495
Registration fees 9,329 12,767
Directors' fees and expenses 1,935 2,100
Miscellaneous 5,083 16,771
------------- -------------
Total expenses 2,785,702 4,855,154
Less: advisory fee waived (see Note B) (748,862) (387,018)
Less: expense offset arrangement
(see Note B) (440) (565)
------------- -------------
Net expenses 2,036,400 4,467,571
------------- -------------
Net investment income 10,398,363 18,462,879
------------- -------------
REALIZED AND UNREALIZED GAIN (LOSS)
ON INVESTMENT TRANSACTIONS
Net realized gain (loss) on:
Investment transactions 1,755,436 4,536,974
Futures contracts 82,213 (873,898)
Swap contracts 36,737 93,814
Net change in unrealized
appreciation/depreciation of:
Investments (945,090) 652,354
Futures contracts (274,346) 1,327,362
Swap contracts 650 (517,044)
------------- -------------
Net gain on investment transactions 655,600 5,219,562
------------- -------------
NET INCREASE IN NET ASSETS FROM
OPERATIONS $ 11,053,963 $ 23,682,441
============= =============
See notes to financial statements.
_______________________________________________________________________________
62 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Statement of Operations
- -------------------------------------------------------------------------------
Insured
California
=============
INVESTMENT INCOME
Interest $ 3,519,315
-------------
EXPENSES
Advisory fee 310,955
Distribution fee--Class A 148,646
Distribution fee--Class B 101,219
Distribution fee--Class C 94,305
Custodian 59,096
Administrative 34,500
Transfer agency 27,620
Audit 25,343
Legal 20,063
Registration fees 6,661
Printing 6,630
Directors' fees and expenses 2,340
Miscellaneous 4,623
-------------
Total expenses 842,001
Less: expense offset arrangement (see Note B) (84)
-------------
Net expenses 841,917
-------------
Net investment income 2,677,398
-------------
REALIZED AND UNREALIZED GAIN (LOSS) ON
INVESTMENT TRANSACTIONS
Net realized gain (loss) on:
Investment transactions 1,667,478
Futures contracts (11,325)
Swap contracts 8,816
Net change in unrealized appreciation/depreciation of
Investments (1,544,509)
Futures contracts 93,995
Swap contracts (37,001)
-------------
Net gain on investment transactions 177,454
-------------
NET INCREASE IN NET ASSETS FROM OPERATIONS $ 2,854,852
=============
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 63
Statement of Changes in Net Assets
- -------------------------------------------------------------------------------
STATEMENT OF CHANGES IN NET ASSETS
National
==============================
Six Months
Ended Year Ended
April 30, 2005 October 31,
(unaudited) 2004
============= =============
INCREASE IN NET ASSETS FROM OPERATIONS
Net investment income $ 10,650,008 $ 24,366,623
Net realized gain on investment
transactions 1,859,334 3,113,816
Net change in unrealized
appreciation/depreciation of
investments 1,012,023 6,224,758
------------- -------------
Net increase in net assets from
operations 13,521,365 33,705,197
DIVIDENDS TO SHAREHOLDERS FROM
Net investment income
Class A (8,008,177) (17,799,171)
Class B (1,343,576) (3,770,465)
Class C (1,335,286) (3,217,276)
CAPITAL STOCK TRANSACTIONS
Net decrease (18,916,392) (80,198,932)
------------- -------------
Total decrease (16,082,066) (71,280,647)
NET ASSETS
Beginning of period 485,589,566 556,870,213
------------- -------------
End of period (including distributions
in excess of net investment income
of ($677,503) and ($640,472),
respectively) $ 469,507,500 $ 485,589,566
============= =============
See notes to financial statements.
_______________________________________________________________________________
64 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Statement of Changes in Net Assets
- -------------------------------------------------------------------------------
Insured National
==============================
Six Months
Ended Year Ended
April 30, 2005 October 31,
(unaudited) 2004
============= =============
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS
Net investment income $ 3,196,502 $ 7,186,751
Net realized gain on investment
transactions 743,677 274,358
Net change in unrealized
appreciation/depreciation of
investments (494,602) 3,023,422
------------- -------------
Net increase in net assets from
operations 3,445,577 10,484,531
DIVIDENDS TO SHAREHOLDERS FROM
Net investment income
Class A (2,649,511) (5,905,957)
Class B (367,803) (1,108,189)
Class C (205,835) (511,793)
CAPITAL STOCK TRANSACTIONS
Net decrease (6,917,907) (25,474,760)
------------- -------------
Total decrease (6,695,479) (22,516,168)
NET ASSETS
Beginning of period 165,054,327 187,570,495
------------- -------------
End of period (including undistributed
net investment income of $191,480
and $218,127, respectively) $ 158,358,848 $ 165,054,327
============= =============
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 65
Statement of Changes in Net Assets
- -------------------------------------------------------------------------------
New York
==============================
Six Months
Ended Year Ended
April 30, 2005 October 31,
(unaudited) 2004
============= =============
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS
Net investment income $ 10,398,363 $ 22,889,310
Net realized gain on investment
transactions 1,874,386 4,704,523
Net change in unrealized
appreciation/depreciation of
investments (1,218,786) 2,594,027
------------- -------------
Net increase in net assets from
operations 11,053,963 30,187,860
DIVIDENDS TO SHAREHOLDERS FROM
Net investment income
Class A (6,499,306) (14,205,327)
Class B (2,974,211) (6,854,476)
Class C (889,656) (2,052,427)
CAPITAL STOCK TRANSACTIONS
Net decrease (9,563,259) (65,951,705)
------------- -------------
Total decrease (8,872,469) (58,876,075)
NET ASSETS
Beginning of period 476,806,803 535,682,878
------------- -------------
End of period (including distributions
in excess of net investment income
of ($380,938) and ($416,128),
respectively) $ 467,934,334 $ 476,806,803
============= =============
See notes to financial statements.
_______________________________________________________________________________
66 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Statement of Changes in Net Assets
- -------------------------------------------------------------------------------
California
==============================
Six Months
Ended Year Ended
April 30, 2005 October 31,
(unaudited) 2004
============= =============
INCREASE IN NET ASSETS FROM OPERATIONS
Net investment income $ 18,462,879 $ 43,461,349
Net realized gain on investment
transactions 3,756,890 10,411,627
Net change in unrealized
appreciation/depreciation of
investments 1,462,672 16,043,975
------------- -------------
Net increase in net assets from
operations 23,682,441 69,916,951
DIVIDENDS TO SHAREHOLDERS FROM
Net investment income
Class A (12,908,732) (28,909,395)
Class B (3,047,480) (8,383,891)
Class C (2,553,576) (6,227,673)
CAPITAL STOCK TRANSACTIONS
Net decrease (34,161,094) (174,293,229)
------------- -------------
Total decrease (28,988,441) (147,897,237)
NET ASSETS
Beginning of period 904,120,528 1,052,017,765
------------- -------------
End of period (including distributions
in excess of net investment income
of ($1,166,633) and ($1,119,724),
respectively) $ 875,132,087 $ 904,120,528
============= =============
See notes to financial statements.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 67
Statement of Changes in Net Assets
- -------------------------------------------------------------------------------
Insured California
==============================
Six Months
Ended Year Ended
April 30, 2005 October 31,
(unaudited) 2004
============= =============
INCREASE (DECREASE) IN NET ASSETS
FROM OPERATIONS
Net investment income $ 2,677,398 $ 6,554,307
Net realized gain on investment
transactions 1,664,969 166,181
Net change in unrealized
appreciation/depreciation of
investments (1,487,515) 1,683,673
------------- -------------
Net increase in net assets from
operations 2,854,852 8,404,161
DIVIDENDS TO SHAREHOLDERS FROM
Net investment income
Class A (2,013,513) (4,940,332)
Class B (340,876) (914,071)
Class C (318,034) (767,377)
CAPITAL STOCK TRANSACTIONS
Net decrease (7,994,446) (33,260,007)
------------- -------------
Total decrease (7,812,017) (31,477,626)
NET ASSETS
Beginning of period 144,575,468 176,053,094
------------- -------------
End of period (including distributions
in excess of net investment income
of ($160,862) and ($165,837),
respectively) $ 136,763,451 $ 144,575,468
============= =============
See notes to financial statements.
_______________________________________________________________________________
68 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS
April 30, 2005 (unaudited)
NOTE A
Significant Accounting Policies
AllianceBernstein Municipal Income Fund, Inc. (the "Fund"), is registered under
the Investment Company Act of 1940 as an open-end management investment
company. The Fund, which is a Maryland corporation, operates as a series
company currently comprised of five portfolios: National Portfolio, Insured
National Portfolio, New York Portfolio, California Portfolio and Insured
California Portfolio (the "Portfolios"). Each of the State Portfolios are
non-diversified. Each series is considered to be a separate entity for
financial reporting and tax purposes. Each Portfolio offers three classes of
shares: Class A, Class B and Class C Shares. Class A shares are sold with a
front-end sales charge of up to 4.25% for purchases not exceeding $1,000,000.
With respect to purchases of $1,000,000 or more, Class A shares redeemed within
one year of purchase may be subject to a contingent deferred sales charge of
1%. Class B shares are currently sold with a contingent deferred sales charge
which declines from 3% to zero depending on the period of time the shares are
held. Class B shares will automatically convert to Class A shares six years
after the end of the calendar month of purchase. Class C shares are subject to
a contingent deferred sales charge of 1% on redemptions made within the first
year after purchase. All three classes of shares have identical voting,
dividend, liquidation and other rights, except that each class bears different
distribution expenses and has exclusive voting rights with respect to its
distribution plan. The financial statements have been prepared in conformity
with U.S. generally accepted accounting principles which require management to
make certain estimates and assumptions that affect the reported amounts of
assets and liabilities in the financial statements and amounts of income and
expenses during the reporting period. Actual results could differ from those
estimates. Additional information about some of the items discussed in these
notes to financial statements is contained in the Fund's Statement of
Additional Information, which is available upon request. The following is a
summary of significant accounting policies followed by the Fund.
1. Security Valuation
Portfolio securities are valued at their current market value determined on the
basis of market quotations or, if market quotations are not readily available
or are deemed unreliable, at "fair value" as determined in accordance with
procedures established by and under the general supervision of the Fund's Board
of Directors.
In general, the market values of securities which are readily available and
deemed reliable are determined as follows. Securities listed on a national
securities exchange or on a foreign securities exchange are valued at the last
sale price at the close of the exchange or foreign securities exchange. If
there has been no sale on such day, the securities are valued at the mean of
the closing bid and asked prices on such day. Securities listed on more than
one exchange are valued by reference to the principal exchange on which the
securities are traded; securities not listed
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 69
Notes to Financial Statements
- -------------------------------------------------------------------------------
on an exchange but traded on The NASDAQ Stock Market, Inc. ("NASDAQ") are
valued in accordance with the NASDAQ Official Closing Price; listed put or call
options are valued at the last sale price. If there has been no sale on that
day, such securities will be valued at the closing bid prices on that day; open
futures contracts and options thereon are valued using the closing settlement
price or, in the absence of such a price, the most recent quoted bid price. If
there are no quotations available for the day of valuation, the last available
closing settlement price is used; securities traded in the over-the-counter
market, (OTC) (but excluding securities traded on NASDAQ) are valued at the
mean of the current bid and asked prices as reported by the National Quotation
Bureau or other comparable sources; U.S. Government securities and other debt
instruments having 60 days or less remaining until maturity are valued at
amortized cost if their original maturity was 60 days or less; or by amortizing
their fair value as of the 61st day prior to maturity if their original term to
maturity exceeded 60 days; fixed-income securities, including mortgage backed
and asset backed securities, may be valued on the basis of prices provided by a
pricing service or at a price obtained from one or more of the major
broker/dealers. In cases where broker/dealer quotes are obtained, Alliance
Capital Management, L.P. (the "Adviser") may establish procedures whereby
changes in market yields or spreads are used to adjust, on a daily basis, a
recently obtained quoted price on a security; and OTC and other derivatives are
valued on the basis of a quoted bid price or spread from a major broker/dealer
in such security.
Securities for which market quotations are not readily available (including
restricted securities) or are deemed unreliable are valued at fair value.
Factors considered in making this determination may include, but are not
limited to, information obtained by contacting the issuer, analysts, analysis
of the issuer's financial statements or other available documents. In addition,
the Fund may use fair value pricing for securities primarily traded in non-U.S.
markets because, most foreign markets close well before the Fund values its
securities at 4:00 p.m., Eastern Time. The earlier close of these foreign
markets gives rise to the possibility that significant events, including broad
market moves, may have occurred in the interim and may materially affect the
value of those securities.
2. Taxes
It is each Portfolio's policy to meet the requirements of the Internal Revenue
Code applicable to regulated investment companies and to distribute all of its
investment company taxable income and net realized gains, if any, to
shareholders. Therefore, no provisions for federal income or excise taxes are
required.
3. Investment Income and Investment Transactions
Interest income is accrued daily. Investment transactions are accounted for on
the trade date securities are purchased or sold. As described more fully in the
prospectus for the Portfolios, each portfolio may buy and sell securities from
other affiliated funds in accordance with the requirements of Rule 17a-7 of the
_______________________________________________________________________________
70 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
Investment Company Act of 1940. Each Portfolio has adopted procedures to ensure
that all such transactions are done in accordance with the requirements of Rule
17a-7. Investment gains and losses are determined on the identified cost basis.
The Portfolios amortize premiums and accrete original issue discount and market
discount as adjustments to interest income.
The New York, Insured California and California Portfolios follow an investment
policy of investing primarily in municipal obligations of one state. Economic
changes affecting the state and certain of its public bodies and municipalities
may affect the ability of issuers within the state to pay interest on, or repay
principal of, municipal obligations held by the Portfolios.
4. Income and Expenses
All income earned and expenses incurred by the Portfolios are borne on a
pro-rata basis by each settled class of shares, based on proportionate interest
in each Portfolio represented by the net assets of such class, except that each
Portfolio's Class B and Class C shares bear higher distribution and transfer
agent fees than Class A shares. Expenses of the Fund are charged to each
Portfolio in proportion to net assets.
5. Dividends and Distributions
Dividends and distributions to shareholders, if any, are recorded on the
ex-dividend date. Income dividends and capital gains distributions are
determined in accordance with federal tax regulations and may differ from those
determined in accordance with U.S. generally accepted accounting principles. To
the extent these differences are permanent, such amounts are reclassified
within the capital accounts based on their federal tax basis treatment;
temporary differences do not require such reclassification.
NOTE B
Advisory Fee and Other Transactions with Affiliates
Until September 6, 2004, under the terms of an investment advisory agreement,
the National, New York and California Portfolios paid the Adviser an advisory
fee at an annual rate of .625% of each Portfolio's average daily net assets.
For the Insured National Portfolio, the Agreement provides for a fee at an
annual rate of up to .625% of the first $200 million, .50% of the next $200
million and .45% in excess of $400 million of its average daily net assets. For
the Insured California Portfolio, the Agreement provides for a fee at an annual
rate of up to .55% of the first $200 million, .50% of the next $200 million and
..45% in excess of $400 million of its average daily net assets. Effective
September 7, 2004, the terms of the investment advisory agreement were amended
so that the advisory fee was reduced to an annual rate of .45% of the first
$2.5 billion, .40% of the next $2.5 billion and .35% in excess of $5 billion,
of each Portfolio's average daily net assets. Such fee is accrued daily and
paid monthly.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 71
Notes to Financial Statements
- -------------------------------------------------------------------------------
Effective January 1, 2004 through September 6, 2004, in contemplation of the
final agreement with the Office of New York Attorney General ("NYAG"), the
Advisor began waiving a portion of its advisory fee so as to charge the Fund at
the reduced annual rate discussed above. For a more complete discussion of the
Adviser's settlement with the NYAG, please see "Legal Proceedings" below.
Effective June 16, 2004, the Adviser has agreed to waive its fees and bear
certain expenses to the extent necessary to limit the total portfolio operating
expenses on an annual basis as follows:
Portfolios Class A Class B Class C
- -------------------------------------------------------------------------------
National .68% 1.38% 1.38%
Insured National 1.04% 1.74% 1.74%
New York .58% 1.28% 1.28%
California .77% 1.47% 1.47%
For the six months ended April 30, 2005, such reimbursement waivers amounted to
$592,886, $5,747, $748,862 and $387,018 for National, Insured National, New
York and California Portfolios, respectively.
Pursuant to the advisory agreement, the National, Insured National, New York,
California and Insured California Portfolios each paid $34,500 to the Adviser
representing the cost of certain legal and accounting services provided to each
portfolio by the Adviser for the six months ended April 30, 2005.
Each Portfolio compensates Alliance Global Investor Services, Inc. (AGIS), a
wholly-owned subsidiary of the Adviser, under a Transfer Agency Agreement for
providing personnel and facilities to perform transfer agency services for each
Portfolio. Such compensation amounted to: National Portfolio, $113,226; Insured
National Portfolio, $33,049; New York Portfolio, $84,952; California Portfolio,
$99,082 and Insured California Portfolio, $15,237 for the six months ended
April 30, 2005.
For the six months ended April 30, 2005, the Fund's expenses were reduced by:
National Portfolio $549; Insured National Portfolio $159; New York Portfolio
$440; California Portfolio $565 and Insured California Portfolio, $84 under an
expense offset arrangement with AGIS.
AllianceBernstein Investment Research and Management, Inc. (the "Distributor"),
a wholly-owned subsidiary of the Adviser, serves as the distributor of the
Fund's shares. The Distributor has advised the Fund that it has received
front-end sales charges from sales of Class A shares and contingent deferred
sales
_______________________________________________________________________________
72 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
charges imposed upon redemptions by shareholders of Class A, Class B and Class
C shares for the six months ended April 30, 2005 as follows:
Front-End Contingent Deferred Sales Charges
Sales Charges -------------------------------------------
Portfolio Class A Class A Class B Class C
- -------------------------------------------------------------------------------
National $10,112 $ -0- $19,261 $2,926
Insured National 1,975 -0- 14,894 482
New York 15,538 -0- 40,734 994
California 2,318 8,309 39,097 7,180
Insured California 18,717 -0- 14,584 140
Accrued expenses for the National Portfolio includes $1,298 owed to a director
under the trust's deferred compensation plan.
NOTE C
Distribution Services Agreement
The Fund has adopted a Distribution Services Agreement (the "Agreement")
pursuant to Rule 12b-1 under the Investment Company Act of 1940. Under the
Agreement, each Portfolio pays distribution and servicing fees to the
Distributor at an annual rate of up to .30 of 1% of each Portfolio's average
daily net assets attributable to the Class A shares and 1% of each Portfolio's
average daily net assets attributable to both Class B and Class C shares. The
fees are accrued daily and paid monthly. The Agreement provides that the
Distributor will use such payments in their entirety for distribution
assistance and promotional activities. The Distributor has advised the Fund
that it has incurred expenses in excess of the distribution costs reimbursed by
each Portfolio as follows:
Portfolio Class B Class C
=========== ============== ==============
National $ 4,093,652 $ 4,532,303
Insured National 3,642,442 1,836,876
New York 7,784,127 2,622,990
California 8,162,338 5,568,465
Insured California 3,081,689 1,650,737
Such costs may be recovered from each Portfolio in future periods so long as
the Agreement is in effect. In accordance with the Agreement, there is no
provision for recovery of unreimbursed distribution costs incurred by the
Distributor beyond the current fiscal year for Class A shares. The Agreement
also provides that the Adviser may use its own resources to finance the
distribution of each Portfolio's shares.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 73
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTE D
Investment Transactions
Purchases and sales of investment securities (excluding short-term investments)
for the six months ended April 30, 2005 were as follows:
Portfolio Purchases Sales
=========== ============== ==============
National $ 65,427,588 $ 97,842,823
Insured National 10,040,857 20,666,664
New York 47,545,808 45,301,873
California 69,596,908 113,970,634
Insured California 28,874,510 40,997,180
There were no purchases or sales of U.S. government and government agency
obligations for the six months ended April 30, 2005.
The cost of investments for federal income tax purposes was substantially the
same as the cost for financial reporting purposes. Accordingly, gross
unrealized appreciation and unrealized depreciation (excluding futures and swap
transactions) are as follows:
Gross Unrealized Net
------------------------------- Unrealized
Portfolio Appreciation (Depreciation) Appreciation
- -------------------------------------------------------------------------------
National $ 25,381,566 $ (595,749) $ 24,785,817
Insured National 11,335,486 (19,916) 11,315,570
New York 27,666,822 (217,792) 27,449,030
California 65,872,609 (406,181) 65,466,428
Insured California 9,162,973 (5,844) 9,157,129
1. Financial Futures Contracts
The Fund may buy or sell financial futures contracts for the purpose of hedging
its portfolio against adverse affects of anticipated movements in the market.
The Fund bears the market risk that arises from changes in the value of these
financial instruments and the imperfect correlation between movements in the
price of the futures contracts and movements in the price of the securities
hedged or used for cover.
At the time the Fund enters into a futures contract, the Fund deposits and
maintains as collateral an initial margin as required by the exchange on which
the transaction is effected. Pursuant to the contract, the Fund agrees to
receive from or pay to the broker an amount of cash equal to the daily
fluctuation in the value of the contract. Such receipts or payments are known
as variation margin and
_______________________________________________________________________________
74 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
are recorded by the Fund as unrealized gains or losses. Risks may arise from
the potential inability of a counterparty to meet the terms of the contract.
When the contract is closed, the Fund records a realized gain or loss equal to
the difference between the value of the contract at the time it was opened and
the time it was closed.
2. Swap Agreements
The Fund may enter into swaps to hedge its exposure to interest rates and
credit risk or for investment purposes. A swap is an agreement that obligates
two parties to exchange a series of cash flows at specified intervals based
upon or calculated by reference to changes in specified prices or rates for a
specified amount of an underlying asset. The payment flows are usually netted
against each other, with the difference being paid by one party to the other.
Risks may arise as a result of the failure of the counterparty to the swap
contract to comply with the terms of the swap contract. The loss incurred by
the failure of a counterparty is generally limited to the net interim payment
to be received by the Fund, and/or the termination value at the end of the
contract. Therefore, the Fund considers the creditworthiness of each
counterparty to a swap contract in evaluating potential credit risk.
Additionally, risks may arise from unanticipated movements in interest rates or
in the value of the underlying securities.
As of November 1, 2003, the Fund has adopted the method of accounting for
interim payments on swap contracts in accordance with Financial Accounting
Standards Board Statement No. 133. The Fund accrues for the interim payments on
swap contracts on a daily basis, with the net amount recorded within unrealized
appreciation/depreciation of swap contracts on the statement of assets and
liabilities. Once the interim payments are settled in cash, the net amount is
recorded as realized gain/loss on swaps, in addition to realized gain/loss
recorded upon the termination of swap contracts on the statement of operations.
Prior to November 1, 2003, these interim payments were reflected within
interest income/expense in the statement of operations. Fluctuations in the
value of swap contracts are recorded as a component of net change in unrealized
appreciation/depreciation of investments.
NOTE E
Capital Stock
The Fund has 3,000,000,000 shares of $.001 par value capital stock authorized,
divided into three classes, designated as Class A, Class B and Class C shares.
Each
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 75
Notes to Financial Statements
- -------------------------------------------------------------------------------
Portfolio class consists of 200,000,000 authorized shares. Transactions in
capital stock were as follows:
Shares Amount
--------------------------- ------------------------------
Six Months Six Months
Ended Year Ended Ended Year Ended
National April 30, 2005 October 31, April 30, 2005 October 31,
Portfolio (unaudited) 2004 (unaudited) 2004
- ------------ ------------ ------------ -------------- --------------
Class A
Shares sold 1,020,994 2,106,313 $ 10,348,411 $ 21,206,306
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 512,600 1,062,068 5,192,617 10,700,580
- -------------------------------------------------------------------------------
Shares converted
from Class B 551,226 908,105 5,574,985 9,149,675
- -------------------------------------------------------------------------------
Shares redeemed (2,533,494) (7,574,363) (25,662,034) (76,128,944)
- -------------------------------------------------------------------------------
Net decrease (448,674) (3,497,877) $ (4,546,021) $(35,072,383)
===============================================================================
Class B
Shares sold 237,570 578,587 $ 2,401,231 $ 5,842,291
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 89,058 219,683 901,169 2,211,420
- -------------------------------------------------------------------------------
Shares converted
to Class A (551,772) (909,487) (5,574,985) (9,149,675)
- -------------------------------------------------------------------------------
Shares redeemed (943,005) (2,931,579) (9,543,588) (29,317,272)
- -------------------------------------------------------------------------------
Net decrease (1,168,149) (3,042,796) $(11,816,173) $(30,413,236)
===============================================================================
Class C
Shares sold 299,458 439,534 $ 3,033,349 $ 4,427,586
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 75,412 168,949 763,622 1,700,732
- -------------------------------------------------------------------------------
Shares redeemed (628,718) (2,074,718) (6,351,169) (20,841,631)
- -------------------------------------------------------------------------------
Net decrease (253,848) (1,466,235) $ (2,554,198) $(14,713,313)
===============================================================================
_______________________________________________________________________________
76 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
Shares Amount
--------------------------- ------------------------------
Six Months Six Months
Insured Ended Year Ended Ended Year Ended
National April 30, 2005 October 31, April 30, 2005 October 31,
Portfolio (unaudited) 2004 (unaudited) 2004
- ------------ ------------ ------------ -------------- --------------
Class A
Shares sold 402,942 663,909 $ 4,139,097 $ 6,797,650
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 159,261 314,725 1,636,943 3,210,143
- -------------------------------------------------------------------------------
Shares converted
from Class B 112,339 314,704 1,149,932 3,204,389
- -------------------------------------------------------------------------------
Shares redeemed (1,011,844) (2,436,297) (10,381,325) (24,802,001)
- -------------------------------------------------------------------------------
Net decrease (337,302) (1,142,959) $ (3,455,353) $(11,589,819)
===============================================================================
Class B
Shares sold 102,037 187,387 $ 1,045,006 $ 1,914,256
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 23,508 67,644 240,951 688,458
- -------------------------------------------------------------------------------
Shares converted
to Class A (112,654) (315,535) (1,149,932) (3,204,389)
- -------------------------------------------------------------------------------
Shares redeemed (326,735) (1,096,825) (3,347,607) (11,106,033)
- -------------------------------------------------------------------------------
Net decrease (313,844) (1,157,329) $ (3,211,582) $(11,707,708)
===============================================================================
Class C
Shares sold 49,155 135,329 $ 503,745 $ 1,384,233
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 7,885 20,113 80,868 204,719
- -------------------------------------------------------------------------------
Shares redeemed (81,559) (369,493) (835,585) (3,766,185)
- -------------------------------------------------------------------------------
Net decrease (24,519) (214,051) $ (250,972) $ (2,177,233)
===============================================================================
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 77
Notes to Financial Statements
- -------------------------------------------------------------------------------
Shares Amount
--------------------------- ------------------------------
Six Months Six Months
Ended Year Ended Ended Year Ended
New York April 30, 2005 October 31, April 30, 2005 October 31,
Portfolio (unaudited) 2004 (unaudited) 2004
- ------------ ------------ ------------ -------------- --------------
Class A
Shares sold 1,534,088 2,422,050 $ 15,181,553 $ 23,861,758
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 482,577 1,009,825 4,785,815 9,941,832
- -------------------------------------------------------------------------------
Shares converted
from Class B 510,385 1,018,102 5,057,924 10,022,329
- -------------------------------------------------------------------------------
Shares redeemed (2,608,549) (8,061,705) (25,874,224) (79,561,547)
- -------------------------------------------------------------------------------
Net decrease (81,499) (3,611,728) $ (848,932) $(35,735,628)
===============================================================================
Class B
Shares sold 903,660 2,250,287 $ 8,953,315 $ 22,104,831
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 224,706 473,978 2,225,839 4,660,130
- -------------------------------------------------------------------------------
Shares converted
to Class A (511,127) (1,019,366) (5,057,924) (10,022,329)
- -------------------------------------------------------------------------------
Shares redeemed (1,376,479) (4,010,210) (13,626,149) (39,249,636)
- -------------------------------------------------------------------------------
Net decrease (759,240) (2,305,311) $ (7,504,919) $(22,507,004)
===============================================================================
Class C
Shares sold 188,560 353,153 $ 1,867,520 $ 3,469,107
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 58,032 122,716 575,143 1,207,406
- -------------------------------------------------------------------------------
Shares redeemed (368,879) (1,265,156) (3,652,071) (12,385,586)
- -------------------------------------------------------------------------------
Net decrease (122,287) (789,287) $ (1,209,408) $ (7,709,073)
===============================================================================
_______________________________________________________________________________
78 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
Shares Amount
--------------------------- ------------------------------
Six Months Six Months
Ended Year Ended Ended Year Ended
California April 30, 2005 October 31, April 30, 2005 October 31,
Portfolio (unaudited) 2004 (unaudited) 2004
- ------------ ------------ ------------ -------------- --------------
Class A
Shares sold 2,204,044 4,313,305 $ 24,094,849 $ 46,524,777
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 738,172 1,565,519 8,074,591 16,901,277
- -------------------------------------------------------------------------------
Shares converted
from Class B 921,568 1,341,372 10,056,022 14,482,317
- -------------------------------------------------------------------------------
Shares redeemed (3,833,903) (14,100,595) (41,902,894) (151,643,233)
- -------------------------------------------------------------------------------
Net increase
(decrease) 29,881 (6,880,399) $ 322,568 $(73,734,862)
===============================================================================
Class B
Shares sold 174,224 623,013 $ 1,907,640 $ 6,737,003
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 185,529 482,633 2,028,583 5,211,465
- -------------------------------------------------------------------------------
Shares converted
to Class A (921,727) (1,341,787) (10,056,022) (14,482,317)
- -------------------------------------------------------------------------------
Shares redeemed (1,820,663) (6,042,269) (19,895,660) (64,850,399)
- -------------------------------------------------------------------------------
Net decrease (2,382,637) (6,278,410) $(26,015,459) $(67,384,248)
===============================================================================
Class C
Shares sold 437,753 736,060 $ 4,783,405 $ 7,949,969
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 119,275 267,954 1,304,260 2,892,849
- -------------------------------------------------------------------------------
Shares redeemed (1,330,931) (4,094,746) (14,555,868) (44,016,937)
- -------------------------------------------------------------------------------
Net decrease (773,903) (3,090,732) $ (8,468,203) $(33,174,119)
===============================================================================
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 79
Notes to Financial Statements
- -------------------------------------------------------------------------------
Shares Amount
--------------------------- ------------------------------
Six Months Six Months
Insured Ended Year Ended Ended Year Ended
California April 30, 2005 October 31, April 30, 2005 October 31,
Portfolio (unaudited) 2004 (unaudited) 2004
- ------------ ------------ ------------ -------------- --------------
Class A
Shares sold 216,103 311,027 $ 3,064,762 $ 4,392,860
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 84,601 192,258 1,198,441 2,720,559
- -------------------------------------------------------------------------------
Shares converted
from Class B 29,040 127,615 411,867 1,798,159
- -------------------------------------------------------------------------------
Shares redeemed (669,160) (2,248,715) (9,458,470) (31,557,790)
- -------------------------------------------------------------------------------
Net decrease (339,416) (1,617,815) $ (4,783,400) $(22,646,212)
===============================================================================
Class B
Shares sold 23,802 126,832 $ 338,786 $ 1,809,363
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 15,777 40,644 223,379 575,164
- -------------------------------------------------------------------------------
Shares converted
to Class A (29,054) (127,663) (411,867) (1,798,159)
- -------------------------------------------------------------------------------
Shares redeemed (206,223) (609,915) (2,910,804) (8,598,143)
- -------------------------------------------------------------------------------
Net decrease (195,698) (570,102) $ (2,760,506) $ (8,011,775)
===============================================================================
Class C
Shares sold 92,044 169,523 $ 1,302,702 $ 2,409,230
- -------------------------------------------------------------------------------
Shares issued in
reinvestment of
dividends 14,104 33,934 199,687 479,739
- -------------------------------------------------------------------------------
Shares redeemed (138,434) (388,546) (1,952,929) (5,490,989)
- -------------------------------------------------------------------------------
Net decrease (32,286) (185,089) $ (450,540) $ (2,602,020)
===============================================================================
NOTE F
Risks Involved inInvesting in the Fund
Concentration of Credit Risk--The Portfolios of the AllianceBernstein Municipal
Income Fund are State Portfolios that may invest a large portion of their
assets in a particular state's municipal securities and their various political
subdivisions, and the performance of each of these Portfolios may be closely
tied to economic conditions within the applicable state and the financial
condition of that state and its agencies and municipalities.
Indemnification Risk--In the ordinary course of business, the Fund enters into
contracts that contain a variety of indemnifications. The Fund's maximum
exposure under these arrangements is unknown. However, the Fund has not had
prior claims or losses pursuant to these indemnification provisions and expects
the risk of loss thereunder to be remote.
_______________________________________________________________________________
80 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTE G
Joint Credit Facility
A number of open-end mutual funds managed by the Adviser, including the Fund,
participate in a $500 million revolving credit facility (the "Facility")
intended to provide short-term financing if necessary, subject to certain
restrictions, in connection with abnormal redemption activity. Commitment fees
related to the Facility are paid by the participating funds and are included in
miscellaneous expenses in the statement of operations. The Fund did not utilize
the Facility during the six months ended April 30, 2005.
NOTE H
Distributions to Shareholders
The tax character of distributions to be paid for the year ending October 31,
2005 will be determined at the end of the current fiscal year. The tax
character of distributions paid during the fiscal years ended October 31, 2004
and 2003 were as follows:
National Portfolio 2004 2003
============== ==============
Distributions paid from:
Ordinary income $ 736,836 $ 1,829,726
Tax-exempt income 24,050,076 29,358,418
-------------- --------------
Total distributions paid $ 24,786,912 $ 31,188,144
============== ==============
As of October 31, 2004, the components of accumulated earnings/(deficit) on a
tax basis were as follows:
Accumulated capital and other losses $ (54,430,084)(a)
Unrealized appreciation 23,503,491(b)
--------------
Total accumulated earnings/(deficit) $ (30,926,593)(c)
==============
(a) On October 31, 2004, the Portfolio had a net capital loss carryforward of
$54,430,084, of which $12,161,492 expires in the year 2007, $18,808,737 expires
in the year 2008, $12,984,821 expires in the year 2010 and $10,475,034 expires
in the year 2011. To the extent future capital gains are offset by capital loss
carryforward, such gains will not be distributed. During the current fiscal
year $2,888,492 of the capital loss carryforward was utilized.
(b) The difference between book-basis and tax-basis unrealized
appreciation/(depreciation) is attributable primarily to the tax deferral of
losses on wash sales, and the difference between the book and tax treatment of
swap income.
(c) The difference between book-basis and tax-basis components of accumulated
earnings/(deficit) is attributable primarily to dividends payable.
Insured National Portfolio 2004 2003
============== ==============
Distributions paid from:
Ordinary income $ 12,360 $ -0-
Tax-exempt income 7,513,579 8,168,945
-------------- --------------
Total distributions paid $ 7,525,939 $ 8,168,945
============== ==============
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 81
Notes to Financial Statements
- -------------------------------------------------------------------------------
As of October 31, 2004, the components of accumulated earnings/(deficit) on a
tax basis were as follows:
Undistributed ordinary income $ 422,690
Accumulated capital and other losses (3,888,958)(a)
Unrealized appreciation 11,643,110(b)
--------------
Total accumulated earnings/(deficit) $ 8,176,842(c)
==============
(a) On October 31, 2004, the Portfolio had a net capital loss carryforward of
$3,888,958, of which $1,875,023 expires in the year 2007, $1,593,951 in 2008
and $419,984 expires in the year 2010. To the extent future capital gains are
offset by capital loss carryforward, such gains will not be distributed. During
the current fiscal year, $34,502 of capital loss carryforward was utilized.
(b) The difference between book-basis and tax-basis unrealized
appreciation/(depreciation) is attributable primarily to the tax deferral of
losses on wash sales and the realization for tax purpose of gain/losses on
certain derivative instruments, and the difference between the book and tax
treatment of swap income.
(c) The difference between book-basis and tax-basis components of accumulated
earnings/(deficit) is attributable primarily to dividends payable.
New York Portfolio 2004 2003
============== ==============
Distributions paid from:
Ordinary income $ -0- $ 126,538
Tax-exempt income 23,112,230 26,794,529
-------------- --------------
Total distributions paid $ 23,112,230 $ 26,921,067
============== ==============
As of October 31, 2004, the components of accumulated earnings/(deficit) on a
tax basis were as follows:
Undistributed tax-exempt net investment income $ 144,932
Accumulated capital and other losses (19,018,440)(a)
Unrealized appreciation/(depreciation) 27,905,118(b)
--------------
Total accumulated earnings/(deficit) $ 9,031,610(c)
==============
(a) On October 31, 2004, the Portfolio had a net capital loss carryforward of
$19,018,440, of which $2,275,884 expires in the year 2007, $5,997,244 expires
in the year 2008, $6,973,404 expires in the year 2009 and $3,771,908 expires in
the year 2011. To the extent future capital gains are offset by capital loss
carryforward, such gains will not be distributed. During the current fiscal
year, $4,997,791 of the capital loss carryforward was utilized.
(b) The difference between book-basis and tax-basis unrealized
appreciation/(depreciation) is attributable primarily to the tax deferral of
losses on wash sales and the realization for tax purposes of unrealized
gains/(losses) on certain derivative instruments, and the difference between
the book and tax treatment of swap income.
(c) The difference between book-basis and tax-basis components of accumulated
earnings/(deficit) is attributable primarily to dividends payable.
_______________________________________________________________________________
82 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
California Portfolio 2004 2003
============== ==============
Distributions paid from:
Ordinary income $ 662,168 $ 2,830,191
Tax-exempt income 42,858,791 52,843,680
-------------- --------------
Total distributions paid $ 43,520,959 $ 55,673,871
============== ==============
As of October 31, 2004, the components of accumulated earnings/(deficit) on a
tax basis were as follows:
Accumulated capital and other losses $ (32,390,284)(a)
Unrealized appreciation/(depreciation) 63,770,909(b)
--------------
Total accumulated earnings/(deficit) $ 31,380,625(c)
==============
(a) On October 31, 2004, the Portfolio had a net capital loss carryforward of
$32,390,284 of which $7,305,591 expires in the year 2007, $10,170,666 expires
in the year 2008, $10,406,492 expires in the year 2009 and $4,507,535 expires
in the year 2010. To the extent future capital gains are offset by capital loss
carryforward, such gains will not be distributed. During the current fiscal
year, $9,216,232 of capital loss carryforward was utilized.
(b) The difference between book-basis and tax-basis unrealized
appreciation/(depreciation) is attributable primarily to the tax deferral of
losses on wash sales and the realization for tax purposes of gains/(losses) on
certain derivative instruments and the difference between the book and tax
treament of swap income.
(c) The difference between book-basis and tax-basis components of accumulated
earnings/(deficit) is attributable primarily to dividends payable.
Insured California Portfolio 2004 2003
============== ==============
Distributions paid from:
Ordinary income $ 193,787 $ 374,433
Tax-exempt income 6,427,993 7,521,245
-------------- --------------
Total distributions paid $ 6,621,780 $ 7,895,678
============== ==============
As of October 31, 2004, the components of accumulated earnings/(deficit) on a
tax basis were as follows:
Accumulated capital and other losses $ (63,273)(a)
Unrealized appreciation/(depreciation) 10,721,675(b)
--------------
Total accumulated earnings/(deficit) $ 10,658,402(c)
==============
(a) On October 31, 2004, the Portfolio had a net capital loss carryforward of
$63,273, all of which expires in the year 2010. To the extent future capital
gains are offset by capital loss carryforward, such gains will not be
distributed. During the current fiscal year, $79,950 of the capital loss
carryforward was utilized.
(b) The differences between book-basis and tax-basis unrealized
appreciation/(depreciation) are attributable primarily to the realization for
tax purposes of gains/losses on certain derivative instruments, and the
difference between the book and tax treatment of swap income.
(c) The difference between book-basis and tax-basis components of accumulated
earnings/(deficit) is attributable primarily to dividends payable.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 83
Notes to Financial Statements
- -------------------------------------------------------------------------------
NOTE I
Legal Proceedings
As has been previously reported, the staff of the U.S. Securities and Exchange
Commission ("SEC") and the NYAG have been investigating practices in the mutual
fund industry identified as "market timing" and "late trading" of mutual fund
shares. Certain other regulatory authorities have also been conducting
investigations into these practices within the industry and have requested that
the Adviser provide information to them. The Adviser has been cooperating and
will continue to cooperate with all of these authorities.
On December 18, 2003, the Adviser confirmed that it had reached terms with the
SEC and the NYAG for the resolution of regulatory claims relating to the
practice of "market timing" mutual fund shares in some of the AllianceBernstein
Mutual Funds. The agreement with the SEC is reflected in an Order of the
Commission ("SEC Order"). The agreement with the NYAG is memorialized in an
Assurrance of Discontinuance dated September 1, 2004 ("NYAG Order"). Among the
key provisions of these agreements are the following:
(i) The Adviser agreed to establish a $250 million fund (the "Reimbursement
Fund") to compensate mutual fund shareholders for the adverse effects of market
timing attributable to market timing relationships described in the SEC Order.
According to the SEC Order, the Reimbursement Fund is to be paid, in order of
priority, to fund investors based on (i) their aliquot share of losses suffered
by the fund due to market timing, and (ii) a proportionate share of advisory
fees paid by such fund during the period of such market timing;
(ii) The Adviser agreed to reduce the advisory fees it receives from some of
the AllianceBernstein long-term, open-end retail funds until December 31, 2008;
and
(iii) The Adviser agreed to implement changes to its governance and compliance
procedures. Additionally, the SEC Order and the NYAG Order contemplate that the
Adviser's registered investment company clients, including the Fund, will
introduce governance and compliance changes.
In anticipation of final, definitive documentation of the NYAG Order and
effective January 1, 2004, the Adviser began waiving a portion of its advisory
fee. On September 7, 2004 the Fund's investment advisory agreement was amended
to reflect the reduced advisory fee. For more information on this waiver and
amendment to the Fund's investment advisory agreement, please see "Advisory Fee
and Other Transactions with Affiliates" above.
A special committee of the Adviser's Board of Directors, comprised of the
members of the Adviser's Audit Committee and the other independent member of
the
_______________________________________________________________________________
84 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Notes to Financial Statements
- -------------------------------------------------------------------------------
Adviser's Board, is continuing to direct and oversee an internal investigation
and a comprehensive review of the facts and circumstances relevant to the SEC's
and the NYAG's investigations.
In addition, the Independent Directors of the Fund ("the Independent
Directors") have initiated an investigation of the above-mentioned matters with
the advice of an independent economic consultant and independent counsel. The
Independent Directors have formed a special committee to supervise the
investigation.
On October 2, 2003, a putative class action complaint entitled Hindo et al. v.
AllianceBernstein Growth & Income Fund et al. (the "Hindo Complaint") was filed
against the Adviser; Alliance Capital Management Holding L.P.; Alliance Capital
Management Corporation; AXA Financial, Inc.; certain of the AllianceBernstein
Mutual Funds, including the Fund; Gerald Malone; Charles Schaffran
(collectively, the "Alliance Capital defendants"); and certain other defendants
not affiliated with the Adviser. The Hindo Complaint was filed in the United
States District Court for the Southern District of New York by alleged
shareholders of two of the AllianceBernstein Mutual Funds. The Hindo Complaint
alleges that certain of the Alliance Capital defendants failed to disclose that
they improperly allowed certain hedge funds and other unidentified parties to
engage in late trading and market timing of AllianceBernstein Fund securities,
violating Sections 11 and 15 of the Securities Act, Sections 10(b) and 20(a) of
the Exchange Act, and Sections 206 and 215 of the Advisers Act. Plaintiffs seek
an unspecified amount of compensatory damages and rescission of their contracts
with the Adviser, including recovery of all fees paid to the Adviser pursuant
to such contracts.
Since October 2, 2003, numerous additional lawsuits making factual allegations
similar to those in the Hindo Complaint were filed against the Adviser and
certain other defendants, some of which name the Fund as a defendant. All of
these lawsuits seek an unspecified amount of damages. The lawsuits are now
pending in the United States District Court for the District of Maryland
pursuant to a ruling by the Judicial Panel on Multidistrict Litigation
transferring and centralizing all of the mutual fund cases involving market and
late trading in the District of Maryland.
As a result of the matters discussed above, investors in the AllianceBernstein
Mutual Funds may choose to redeem their investments. This may require the
AllianceBernstein Mutual Funds to sell investments held by those funds to
provide for sufficient liquidity and could also have an adverse effect on the
investment performance of the AllianceBernstein Mutual Funds.
The Adviser and approximately twelve other investment management firms were
publicly mentioned in connection with the settlement by the SEC of charges that
an unaffiliated broker/dealer violated federal securities laws relating to its
receipt of compensation for selling specific mutual funds and the disclosure of
such compensation. The SEC indicated publicly that, among other things, it was
consid-
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 85
Notes to Financial Statements
- -------------------------------------------------------------------------------
ering enforcement action in connection with mutual funds' disclosure of such
arrangements and in connection with the practice of considering mutual fund
sales in the direction of brokerage commissions from fund portfolio
transactions. The SEC issued subpoenas to the Adviser, and the NASD issued
requests for information in connection with this matter and the Adviser
provided documents and other information to the SEC and NASD and cooperated
fully with the investigations. On June 8, 2005 the NASD announced that it had
reached a settlement with the Distributor in connection with this matter.
Management of the Adviser expects that the settlement has resolved both
regulatory inquires described above.
On June 22, 2004, a purported class action complaint entitled Aucoin, et al. v.
Alliance Capital Management L.P., et al. ("Aucoin Complaint") was filed against
the Adviser, Alliance Capital Management Holding L.P., Alliance Capital
Management Corporation, AXA Financial, Inc., AllianceBernstein Investment
Research & Management, Inc., certain current and former directors of the
AllianceBernstein Mutual Funds, and unnamed Doe defendants. The Aucoin
Complaint names certain of the AllianceBernstein mutual funds as nominal
defendants. The Aucoin Complaint was filed in the United States District Court
for the Southern District of New York by an alleged shareholder of an
AllianceBernstein mutual fund. The Aucoin Complaint alleges, among other
things, (i) that certain of the defendants improperly authorized the payment of
excessive commissions and other fees from fund assets to broker-dealers in
exchange for preferential marketing services, (ii) that certain of the
defendants misrepresented and omitted from registration statements and other
reports material facts concerning such payments, and (iii) that certain
defendants caused such conduct as control persons of other defendants. The
Aucoin Complaint asserts claims for violation of Sections 34(b), 36(b) and
48(a) of the Investment Company Act, Sections 206 and 215 of the Advisers Act,
breach of common law fiduciary duties, and aiding and abetting breaches of
common law fiduciary duties. Plaintiffs seek an unspecified amount of
compensatory damages and punitive damages, rescission of their contracts with
the Adviser, including recovery of all fees paid to the Adviser pursuant to
such contracts, an accounting of all fund-related fees, commissions and soft
dollar payments, and restitution of all unlawfully or discriminatorily obtained
fees and expenses.
Since June 22, 2004, numerous additional lawsuits making factual allegations
substantially similar to those in the Aucoin Complaint were filed against the
Adviser and certain other defendants, and others may be filed.
It is possible that these matters and/or other developments resulting from
these matters could result in increased redemptions of the Fund's shares or
other adverse consequences to the Fund. However, the Adviser believes that
these matters are not likely to have a material adverse effect on its ability
to perform advisory services relating to the Fund.
_______________________________________________________________________________
86 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
National Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $10.13 $9.96 $9.80 $10.34 $10.14 $10.02
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .24 .50 .52 .54 .54 .55
Net realized and unrealized
gain (loss) on investment
transactions .07 .17 .18 (.53) .21 .12
Net increase in net asset value
from operations .31 .67 .70 .01 .75 .67
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.24) (.50) (.54) (.54) (.54) (.55)
Distributions in excess of net
investment income -0- -0- -0- (.01) (.01) -0-
Total dividends and distributions (.24) (.50) (.54) (.55) (.55) (.55)
Net asset value, end of period $10.20 $10.13 $9.96 $9.80 $10.34 $10.14
TOTAL RETURN
Total investment return based
on net asset value(d) 3.06% 6.92% 7.32% .06% 7.55% 6.95%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $342,095 $344,557 $373,416 $411,408 $425,506 $412,248
Ratio to average net assets of:
Expenses, net of fee waivers .68%(e) .68% .68% .65% .64% .68%
Expenses, before fee waivers .93%(e) 1.08% 1.11% 1.07% 1.06% 1.11%
Net investment income(b) 4.69%(e) 4.94% 5.25% 5.28% 5.22% 5.53%
Portfolio turnover rate 14% 47% 35% 63% 194% 415%
See footnote summary on page 107.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 87
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
National Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $10.12 $9.95 $9.79 $10.33 $10.13 $10.00
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .20 .43 .45 .46 .47 .48
Net realized and unrealized
gain (loss) on investment
transactions .07 .17 .18 (.52) .21 .13
Net increase (decrease) in net
asset value from operations .27 .60 .63 (.06) .68 .61
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.20) (.43) (.47) (.47) (.47) (.48)
Distributions in excess of net
investment income -0- -0- -0- (.01) (.01) -0-
Total dividends and distributions (.20) (.43) (.47) (.48) (.48) (.48)
Net asset value, end of period $10.19 $10.12 $9.95 $9.79 $10.33 $10.13
TOTAL RETURN
Total investment return based
on net asset value(d) 2.71% 6.18% 6.57% (.62)% 6.84% 6.32%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $60,809 $72,264 $101,287 $122,656 $132,074 $117,779
Ratio to average net assets of:
Expenses, net of fee waivers 1.38%(e) 1.39% 1.39% 1.35% 1.36% 1.39%
Expenses, before fee waivers 1.64%(e) 1.79% 1.81% 1.77% 1.79% 1.79%
Net investment income(b) 3.99%(e) 4.24% 4.54% 4.57% 4.59% 4.80%
Portfolio turnover rate. 14% 47% 35% 63% 194% 415%
See footnote summary on page 107.
_______________________________________________________________________________
88 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
National Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $10.13 $9.95 $9.79 $10.34 $10.13 $10.00
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .20 .43 .45 .47 .47 .48
Net realized and unrealized
gain (loss) on investment
transactions .06 .18 .18 (.54) .22 .13
Net increase (decrease) in net
asset value from operations .26 .61 .63 (.07) .69 .61
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.20) (.43) (.47) (.47) (.47) (.48)
Distributions in excess of net
investment income. -0- -0- -0- (.01) (.01) -0-
Total dividends and distributions (.20) (.43) (.47) (.48) (.48) (.48)
Net asset value, end of period $10.19 $10.13 $9.95 $9.79 $10.34 $10.13
TOTAL RETURN
Total investment return based
on net asset value(d) 2.61% 6.28% 6.57% (.72)% 6.94% 6.32%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $66,604 $68,769 $82,167 $93,032 $98,825 $93,861
Ratio to average net assets of:
Expenses, net of fee waivers 1.38%(e) 1.38% 1.38% 1.35% 1.35% 1.38%
Expenses, before fee waivers 1.63%(e) 1.78% 1.81% 1.76% 1.78% 1.79%
Net investment income(b) 3.99%(e) 4.24% 4.55% 4.58% 4.61% 4.83%
Portfolio turnover rate 14% 47% 35% 63% 194% 415%
See footnote summary on page 107.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 89
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Insured National Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $10.29 $10.11 $9.92 $10.07 $9.58 $9.33
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .21 .44 .47 .45 .45 .45
Net realized and unrealized
gain (loss) on investment
transactions .03 .20 .14 (.14) .50 .26
Net increase in net asset value
from operations .24 .64 .61 .31 .95 .71
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.22) (.46) (.42) (.45) (.45) (.45)
Distributions in excess of net
investment income -0- -0- -0- (.01) (.01) (.01)
Total dividends and distributions (.22) (.46) (.42) (.46) (.46) (.46)
Net asset value, end of period $10.31 $10.29 $10.11 $9.92 $10.07 $9.58
TOTAL RETURN
Total investment return based
on net asset value(d) 2.28% 6.42% 6.32% 3.13% 10.11% 7.84%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $126,616 $129,888 $139,179 $164,154 $169,744 $161,977
Ratio to average net assets of:
Expenses, net of fee waivers 1.04%(e) 1.03% 1.04% 1.01% 1.04% 1.09%
Expenses, before fee waivers 1.05%(e) 1.18% 1.16% 1.13% 1.14% 1.16%
Net investment income(b) 4.12%(e) 4.28% 4.69% 4.49% 4.53% 4.83%
Portfolio turnover rate 6% 12% 28% 43% 105% 311%
See footnote summary on page 107.
_______________________________________________________________________________
90 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Insured National Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $10.26 $10.09 $9.89 $10.05 $9.56 $9.31
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .17 .36 .40 .37 .38 .40
Net realized and unrealized
gain (loss) on investment
transactions .03 .19 .16 (.14) .50 .26
Net increase in net asset value
from operations .20 .55 .56 .23 .88 .66
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.18) (.38) (.36) (.38) (.38) (.40)
Distributions in excess of net
investment income -0- -0- -0- (.01) (.01) (.01)
Total dividends and distributions (.18) (.38) (.36) (.39) (.39) (.41)
Net asset value, end of period $10.28 $10.26 $10.09 $9.89 $10.05 $9.56
TOTAL RETURN
Total investment return based
on net asset value(d) 1.93% 5.60% 5.71% 2.34% 9.39% 7.10%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $19,778 $22,968 $34,243 $35,048 $35,326 $25,070
Ratio to average net assets of:
Expenses, net of fee waivers 1.74%(e) 1.74% 1.75% 1.72% 1.75% 1.80%
Expenses, before fee waivers 1.76%(e) 1.89% 1.87% 1.84% 1.85% 1.87%
Net investment income(b) 3.43%(e) 3.58% 4.00% 3.79% 3.83% 4.12%
Portfolio turnover rate 6% 12% 28% 43% 105% 311%
See footnote summary on page 107.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 91
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Insured National Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $10.27 $10.09 $9.90 $10.05 $9.56 $9.32
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .18 .37 .40 .37 .38 .40
Net realized and unrealized
gain (loss) on investment
transactions .01 .19 .15 (.13) .50 .25
Net increase in net asset value
from operations .19 .56 .55 .24 .88 .65
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.18) (.38) (.36) (.38) (.38) (.40)
Distributions in excess of net
investment income -0- -0- -0- (.01) (.01) (.01)
Total dividends and distributions (.18) (.38) (.36) (.39) (.39) (.41)
Net asset value, end of period $10.28 $10.27 $10.09 $9.90 $10.05 $9.56
TOTAL RETURN
Total investment return based
on net asset value(d) 1.83% 5.71% 5.60% 2.44% 9.39% 6.98%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $11,965 $12,198 $14,149 $17,592 $16,650 $13,930
Ratio to average net assets of:
Expenses, net of fee waivers 1.74%(e) 1.73% 1.74% 1.71% 1.74% 1.80%
Expenses, before fee waivers 1.75%(e) 1.88% 1.86% 1.83% 1.85% 1.85%
Net investment income(b) 3.44%(e) 3.59% 3.98% 3.78% 3.84% 4.14%
Portfolio turnover rate 6% 12% 28% 43% 105% 311%
See footnote summary on page 107.
_______________________________________________________________________________
92 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
New York Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $9.93 $9.79 $9.69 $9.93 $9.70 $9.45
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .23 .48 .50 .53 .53 .52
Net realized and unrealized
gain (loss) on investment
transactions .02 .15 .11 (.25) .22 .25
Net increase in net asset value
from operations .25 .63 .61 .28 .75 .77
LESS: DIVIDENDS
Dividends from net
investment income (.23) (.49) (.51) (.52) (.52) (.52)
Total dividends (.23) (.49) (.51) (.52) (.52) (.52)
Net asset value, end of period $9.95 $9.93 $9.79 $9.69 $9.93 $9.70
TOTAL RETURN
Total investment return based
on net asset value(d) 2.56% 6.58% 6.39% 2.89% 7.86% 8.42%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $279,811 $280,213 $311,596 $322,621 $326,500 $259,997
Ratio to average net assets of:
Expenses, net of fee waivers .58%(e) .59% .58% .58% .59% .77%
Expenses, before fee waivers .90%(e) 1.05% 1.06% 1.05% 1.04% 1.10%
Net investment income(b) 4.71%(e) 4.93% 5.09% 5.42% 5.28% 5.46%
Portfolio turnover rate 10% 33% 35% 33% 92% 187%
See footnote summary on page 107.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 93
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
New York Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $9.92 $9.78 $9.68 $9.93 $9.70 $9.45
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .20 .41 .43 .46 .45 .45
Net realized and unrealized
gain (loss) on investment
transactions .01 .15 .11 (.26) .23 .25
Net increase in net asset value
from operations .21 .56 .54 .20 .68 .70
LESS: DIVIDENDS
Dividends from net
investment income (.20) (.42) (.44) (.45) (.45) (.45)
Total dividends (.20) (.42) (.44) (.45) (.45) (.45)
Net asset value, end of period $9.93 $9.92 $9.78 $9.68 $9.93 $9.70
TOTAL RETURN
Total investment return based
on net asset value(d) 2.11% 5.85% 5.64% 2.04% 7.10% 7.61%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $144,152 $151,474 $171,881 $184,700 $165,787 $100,651
Ratio to average net assets of:
Expenses, net of fee waivers 1.28%(e) 1.30% 1.29% 1.29% 1.30% 1.48%
Expenses, before fee waivers 1.60%(e) 1.76% 1.77% 1.78% 1.76% 1.81%
Net investment income(b) 4.02%(e) 4.22% 4.38% 4.70% 4.59% 4.75%
Portfolio turnover rate 10% 33% 35% 33% 92% 187%
See footnote summary on page 107.
_______________________________________________________________________________
94 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
New York Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- ---------
Net asset value,
beginning of period $9.92 $9.78 $9.68 $9.94 $9.71 $9.45
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .20 .41 .43 .46 .46 .45
Net realized and unrealized
gain (loss) on investment
transactions .02 .15 .11 (.27) .22 .26
Net increase in net asset value
from operations .22 .56 .54 .19 .68 .71
LESS: DIVIDENDS
Dividends from net
investment income (.20) (.42) (.44) (.45) (.45) (.45)
Total dividends (.20) (.42) (.44) (.45) (.45) (.45)
Net asset value, end of period $9.94 $9.92 $9.78 $9.68 $9.94 $9.71
TOTAL RETURN
Total investment return based
on net asset value(d) 2.21% 5.85% 5.64% 1.94% 7.09% 7.72%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $43,971 $45,121 $52,206 $57,386 $54,631 $42,888
Ratio to average net assets of:
Expenses, net of fee waivers 1.28%(e) 1.29% 1.29% 1.29% 1.30% 1.47%
Expenses, before fee waivers 1.60%(e) 1.75% 1.77% 1.77% 1.76% 1.80%
Net investment income(b) 4.02%(e) 4.23% 4.38% 4.71% 4.60% 4.76%
Portfolio turnover rate 10% 33% 35% 33% 92% 187%
See footnote summary on page 107.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 95
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
California Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- ---------
Net asset value,
beginning of period $10.93 $10.63 $10.84 $11.00 $10.88 $10.58
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .24 .51 .53 .55 .54 .56
Net realized and unrealized gain
(loss) on investment
transactions .07 .30 (.19) (.15) .14 .30
Net increase in net asset value
from operations .31 .81 .34 .40 .68 .86
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.24) (.51) (.55) (.54) (.54) (.56)
Distributions in excess of net
investment income -0- -0- -0- (.02) (.02) -0-
Total dividends and distributions (.24) (.51) (.55) (.56) (.56) (.56)
Net asset value, end of period $11.00 $10.93 $10.63 $10.84 $11.00 $10.88
TOTAL RETURN
Total investment return based
on net asset value(d) 2.86% 7.80% 3.15% 3.82% 6.47% 8.38%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $591,715 $587,874 $644,868 $725,242 $755,947 $714,654
Ratio to average net assets of:
Expenses, net of fee waivers .77%(e) .78% .77% .76% .77% .84%
Expenses, before fee waivers .86%(e) 1.01% 1.02% 1.01% 1.02% 1.04%
Net investment income(b) 4.40%(e) 4.75% 4.93% 5.05% 4.98% 5.32%
Portfolio turnover rate 8% 34% 33% 23% 78% 124%
See footnote summary on page 107.
_______________________________________________________________________________
96 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
California Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- ----------
Net asset value,
beginning of period $10.93 $10.63 $10.84 $11.00 $10.88 $10.58
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .20 .44 .46 .47 .46 .48
Net realized and unrealized gain
(loss) on investment
transactions .07 .30 (.20) (.14) .15 .30
Net increase in net asset value
from operations .27 .74 .26 .33 .61 .78
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net investment
income (.20) (.44) (.47) (.47) (.46) (.48)
Distributions in excess of net
investment income -0- -0- -0- (.02) (.03) -0-
Total dividends and distributions (.20) (.44) (.47) (.49) (.49) (.48)
Net asset value, end of period $11.00 $10.93 $10.63 $10.84 $11.00 $10.88
TOTAL RETURN
Total investment return based
on net asset value(d) 2.51% 7.05% 2.43% 3.10% 5.74% 7.60%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $150,057 $175,215 $237,147 $279,697 $269,726 $222,897
Ratio to average net assets of:
Expenses, net of fee waivers 1.47%(e) 1.48% 1.48% 1.46% 1.48% 1.54%
Expenses, before fee waivers 1.56%(e) 1.71% 1.73% 1.72% 1.73% 1.74%
Net investment income(b) 3.71%(e) 4.05% 4.22% 4.35% 4.26% 4.61%
Portfolio turnover rate 8% 34% 33% 23% 78% 124%
See footnote summary on page 107.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 97
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
California Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- ----------
Net asset value,
beginning of period $10.93 $10.63 $10.84 $11.00 $10.88 $10.58
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .20 .44 .46 .47 .46 .48
Net realized and unrealized gain
(loss) on investment
transactions .07 .30 (.20) (.14) .15 .30
Net increase in net asset value
from operations .27 .74 .26 .33 .61 .78
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.20) (.44) (.47) (.47) (.46) (.48)
Distributions in excess of net
investment income -0- -0- -0- (.02) (.03) -0-
Total dividends and distributions (.20) (.44) (.47) (.49) (.49) (.48)
Net asset value, end of period $11.00 $10.93 $10.63 $10.84 $11.00 $10.88
TOTAL RETURN
Total investment return based
on net asset value(d) 2.51% 7.05% 2.43% 3.10% 5.74% 7.60%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $133,360 $141,031 $170,003 $209,008 $211,502 $156,156
Ratio to average net assets of:
Expenses, net of fee waivers 1.47%(e) 1.48% 1.47% 1.46% 1.47% 1.54%
Expenses, before fee waivers 1.56%(e) 1.71% 1.72% 1.71% 1.72% 1.74%
Net investment income(b) 3.70%(e) 4.05% 4.23% 4.35% 4.25% 4.62%
Portfolio turnover rate 8% 34% 33% 23% 78% 124%
See footnote summary on page 107.
_______________________________________________________________________________
98 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Insured California Portfolio
----------------------------------------------------------------------------
Class A
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $14.21 $14.03 $14.17 $14.45 $13.74 $13.11
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .29 .61 .60 .62 .63 .64
Net realized and unrealized
gain (loss) on investment
transactions .02 .18 (.12) (.12) .74 .63
Net increase in net asset value
from operations .31 .79 .48 .50 1.37 1.27
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.29) (.61) (.62) (.62) (.63) (.64)
Distributions in excess of net
investment income -0- -0- -0- (.04) (.03) -0-
Distributions from net realized
gain on investment transactions -0- -0- -0- (.12) -0- -0-
Total dividends and distributions (.29) (.61) (.62) (.78) (.66) (.64)
Net asset value, end of period $14.23 $14.21 $14.03 $14.17 $14.45 $13.74
TOTAL RETURN
Total investment return based
on net asset value(d) 2.18% 5.75% 3.39% 3.65% 10.16% 10.02%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $98,770 $103,414 $124,817 $144,973 $168,469 $115,983
Ratio to average net assets of:
Expenses, net of fee waivers 1.02%(e) 1.00% 1.07% 1.03% 1.04% 1.09%
Expenses, before fee waivers 1.02%(e) 1.07% 1.07% 1.03% 1.04% 1.09%
Net investment income(b) 4.07%(e) 4.29% 4.24% 4.43% 4.44% 4.82%
Portfolio turnover rate 21% 5% 34% 31% 140% 174%
See footnote summary on page 107.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 99
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Insured California Portfolio
----------------------------------------------------------------------------
Class B
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $14.20 $14.02 $14.16 $14.46 $13.75 $13.11
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .24 .50 .50 .52 .52 .54
Net realized and unrealized
gain (loss) on investment
transactions .03 .19 (.12) (.14) .75 .64
Net increase in net asset value
from operations .27 .69 .38 .38 1.27 1.18
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.24) (.51) (.52) (.53) (.52) (.54)
Distributions in excess of net
investment income -0- -0- -0- (.03) (.04) -0-
Distributions from net realized
gain on investment transactions -0- -0- -0- (.12) -0- -0-
Total dividends and distributions (.24) (.51) (.52) (.68) (.56) (.54)
Net asset value, end of period $14.23 $14.20 $14.02 $14.16 $14.46 $13.75
TOTAL RETURN
Total investment return based
on net asset value(d) 1.90% 5.02% 2.67% 2.76% 9.38% 9.27%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $18,814 $21,559 $29,285 $33,133 $27,015 $18,925
Ratio to average net assets of:
Expenses, net of fee waivers 1.73%(e) 1.71% 1.77% 1.73% 1.74% 1.79%
Expenses, before fee waivers 1.73%(e) 1.77% 1.77% 1.73% 1.74% 1.79%
Net investment income(b) 3.37%(e) 3.58% 3.52% 3.70% 3.72% 4.11%
Portfolio turnover rate 21% 5% 34% 31% 140% 174%
See footnote summary on page 107.
_______________________________________________________________________________
100 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Financial Highlights
- -------------------------------------------------------------------------------
Selected Data For A Share Of Capital Stock Outstanding Throughout Each Period
Insured California Portfolio
----------------------------------------------------------------------------
Class C
----------------------------------------------------------------------------
Six Months
Ended
April 30, Year Ended October 31,
2005 ---------------------------------------------------------------
(unaudited) 2004(a) 2003 2002 2001 2000
----------- ----------- ----------- ----------- ----------- -----------
Net asset value,
beginning of period $14.20 $14.02 $14.16 $14.47 $13.75 $13.11
INCOME FROM INVESTMENT
OPERATIONS
Net investment income(b)(c) .24 .51 .50 .52 .52 .54
Net realized and unrealized
gain (loss) on investment
transactions .02 .18 (.12) (.15) .76 .64
Net increase in net asset value
from operations .26 .69 .38 .37 1.28 1.18
LESS: DIVIDENDS AND
DISTRIBUTIONS
Dividends from net
investment income (.24) (.51) (.52) (.53) (.52) (.54)
Distributions in excess of net
investment income -0- -0- -0- (.03) (.04) -0-
Distributions from net realized
gain on investment transactions -0- -0- -0- (.12) -0- -0-
Total dividends and distributions (.24) (.51) (.52) (.68) (.56) (.54)
Net asset value, end of period $14.22 $14.20 $14.02 $14.16 $14.47 $13.75
TOTAL RETURN
Total investment return based
on net asset value(d) 1.83% 5.02% 2.67% 2.69% 9.46% 9.27%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of period
(000's omitted) $19,179 $19,603 $21,951 $22,715 $20,541 $15,536
Ratio to average net assets of:
Expenses, net of fee waivers 1.72%(e) 1.70% 1.77% 1.73% 1.74% 1.79%
Expenses, before fee waivers 1.72%(e) 1.77% 1.77% 1.73% 1.74% 1.79%
Net investment income(b) 3.38%(e) 3.59% 3.53% 3.71% 3.73% 4.12%
Portfolio turnover rate 21% 5% 34% 31% 140% 174%
See footnote summary on page 107.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 101
Financial Highlights
- -------------------------------------------------------------------------------
(a) As of November 1, 2003, the Fund has adopted the method of accounting for
interim payments on swap contracts in accordance with Financial Accounting
Standards Board Statement No. 133. These interim payments are reflected within
net realized and unrealized gain (loss) on swap contracts, however prior to
November 1, 2003, these interim payments were reflected within interest
income/expense on the statement of operations. The effects of these changes for
the year ended October 31, 2004 were as follows:
Realized
and Unrealized Ratio of Net
Gain (Loss) on Investment
Investment Investment Income
Income Transactions to Average
Per Share* Per Share* Net Assets
- -------------------------------------------------------------------------------
National Portfolio
Class A $ .00 $ .00 .01%
Class B .00 .00 .01%
Class C .00 .00 .01%
Insured National Portfolio
Class A .00 .00 .01%
Class B .00 .00 .01%
Class C .00 .00 .01%
New York Portfolio
Class A .00 .00 .05%
Class B .00 .00 .05%
Class C .00 .00 .05%
California Portfolio
Class A .00 .00 .00% +
Class B .00 .00 .00% +
Class C .00 .00 .00% +
Insured California Portfolio
Class A .00 .00 .00% +
Class B .00 .00 .00% +
Class C .00 .00 .00% +
* Per share amounts less than $0.01
+ Amount is less than .01%
(b) Net of fees waived by the Adviser.
(c) Based on average shares outstanding.
(d) Total investment return is calculated assuming an initial investment made
at the net asset value at the beginning of the period, reinvestment of all
dividends and distributions at net asset value during the period, and
redemption on the last day of the period. Initial sales charges or contingent
deferred sales charges are not reflected in the calculation of total investment
return. Total return does not reflect the deduction of taxes that a shareholder
would pay on fund distributions or the redemption of fund shares. Total
investment return calculated for a period of less than one year is not
annualized.
(e) Annualized.
_______________________________________________________________________________
102 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
Board of Directors
- -------------------------------------------------------------------------------
BOARD OF DIRECTORS
William H. Foulk, Jr.(1), Chairman
Marc O. Mayer, President
Ruth Block(1)
David H. Dievler(1)
John H. Dobkin(1)
Michael J. Downey(1)
OFFICERS
Philip L. Kirstein, Senior Vice President and Independent Compliance Officer
Robert B. Davidson, III, Senior Vice President
Douglas J. Peebles, Senior Vice President
Jeffrey S. Phlegar, Senior Vice President
David M. Dowden(2), Vice President
Terrance T. Hults(2), Vice President
William E. Oliver, Vice President
Mark R. Manley, Secretary
Mark D. Gersten, Treasurer and Chief Financial Officer
Thomas R. Manley, Controller
Custodian
State Street Bank & Trust Company
225 Franklin Street
Boston, MA 02110
Principal Underwriter
AllianceBernstein Investment Research and Management, Inc.
1345 Avenue of the Americas
New York, NY 10105
Legal Counsel
Seward & Kissel LLP
One Battery Park Plaza
New York, NY 10004
Independent Registered Public Accounting Firm
Ernst & Young LLP
5 Times Square
New York, NY 10036
Transfer Agent
Alliance Global Investor Services, Inc.
P.O. Box 786003
San Antonio, TX 78278-6003
Toll-free (800) 221-5672
(1) Member of the Audit Committee, Governance and Nominating Committee and the
Independent Directors Committee.
(2) The day-to-day management of and investment decisions for the Portfolios
are made by the Municipal Bond Investment Team.
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 103
AllianceBernstein Family of Funds
- -------------------------------------------------------------------------------
ALLIANCEBERNSTEIN FAMILY OF FUNDS
- --------------------------------------------
Wealth Strategies Funds
- --------------------------------------------
Balanced Wealth Strategy
Wealth Appreciation Strategy
Wealth Preservation Strategy
Tax-Managed Balanced Wealth Strategy
Tax-Managed Wealth Appreciation Strategy
Tax-Managed Wealth Preservation Strategy
- --------------------------------------------
Blended Style Funds
- --------------------------------------------
U.S. Large Cap Portfolio
International Portfolio
Tax-Managed International Portfolio
- --------------------------------------------
Growth Funds
- --------------------------------------------
Domestic
Growth Fund
Mid-Cap Growth Fund
Large Cap Growth Fund*
Small Cap Growth Portfolio
Global & International
Global Health Care Fund*
Global Research Growth Fund
Global Technology Fund*
Greater China '97 Fund
International Growth Fund*
International Research Growth Fund*
- --------------------------------------------
Value Funds
- --------------------------------------------
Domestic
Balanced Shares
Focused Growth & Income Fund*
Growth & Income Fund
Real Estate Investment Fund
Small/Mid-Cap Value Fund*
Utility Income Fund
Value Fund
Global & International
Global Value Fund
International Value Fund
- --------------------------------------------
Taxable Bond Funds
- --------------------------------------------
Americas Government Income Trust
Corporate Bond Portfolio
Emerging Market Debt Fund
Global Strategic Income Trust
High Yield Fund
Multi-Market Strategy Trust
Quality Bond Portfolio
Short Duration Portfolio
U.S. Government Portfolio
- --------------------------------------------
Municipal Bond Funds
- --------------------------------------------
National
Insured National
Arizona
California
Insured California
Florida
Massachusetts
Michigan
Minnesota
New Jersey
New York
Ohio
Pennsylvania
Virginia
- --------------------------------------------
Intermediate Municipal Bond Funds
- --------------------------------------------
Intermediate California
Intermediate Diversified
Intermediate New York
- --------------------------------------------
Closed-End Funds
- --------------------------------------------
All-Market Advantage Fund
ACM Income Fund
ACM Government Opportunity Fund
ACM Managed Dollar Income Fund
ACM Managed Income Fund
ACM Municipal Securities Income Fund
California Municipal Income Fund
National Municipal Income Fund
New York Municipal Income Fund
The Spain Fund
World Dollar Government Fund
World Dollar Government Fund II
We also offer Exchange Reserves,** which serves as the money market fund
exchange vehicle for the AllianceBernstein mutual funds.
For more complete information on any AllianceBernstein mutual fund, including
investment objectives and policies, sales charges, expenses, risks and other
matters of importance to prospective investors, visit our web site at
www.alliancebernstein.com or call us at (800) 227-4618 for a current
prospectus. You should read the prospectus carefully before you invest.
* Prior to December 15, 2004, these Funds were named as follows: Global Health
Care Fund was Health Care Fund; Large Cap Growth Fund was Premier Growth Fund;
Global Technology Fund was Technology Fund; and Focused Growth & Income Fund
was Disciplined Value Fund. Prior to February 1, 2005, Small/Mid-Cap Value Fund
was named Small Cap Value Fund. Prior to May 16, 2005, International Growth
Fund was named Worldwide Privatization Fund and International Research Growth
Fund was named International Premier Growth Fund. On June 24, 2005, All-Asia
Investment Fund merged into International Research GrowthFund. On July 8, 2005,
New Europe Fund will merge into International Research Growth Fund.
** An investment in the Fund is not a deposit in a bank and is not insured or
guaranteed by the Federal Deposit Insurance Corporation or any other government
agency. Although the Fund seeks to preserve the value of your investment at
$1.00 per share, it is possible to lose money by investing in the Fund.
_______________________________________________________________________________
104 o ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
NOTES
_______________________________________________________________________________
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND o 105
ALLIANCEBERNSTEIN MUNICIPAL INCOME FUND
1345 Avenue of the Americas
New York, NY 10105
(800) 221-5672
[LOGO] AllianceBernstein (R)
Investment Research and Management
MUNISR0405
ITEM 2. CODE OF ETHICS.
Not applicable when filing a semi-annual report to shareholders.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not applicable when filing a semi-annual report to shareholders.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not applicable when filing a semi-annual report to shareholders
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable to the Registrant.
ITEM 6. SCHEDULE OF INVESTMENTS.
Please see Schedule of Investments contained in the Report to Shareholders
included under Item 1 of this Form N-CSR.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
Not applicable to the Registrant.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable to the Registrant.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which shareholders
may recommend nominees to the Fund's Board of Directors since the Fund last
provided disclosure in response to this item.
ITEM 10. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive officer and principal financial
officer have concluded that the registrant's disclosure controls and
procedures (as defined in Rule 30a-2(c) under the Investment Company Act
of 1940, as amended) are effective at the reasonable assurance level
based on their evaluation of these controls and procedures as of a date
within 90 days of the filing date of this document.
(b) There were no significant changes in the registrant's internal controls
over financial reporting during the second fiscal quarter of the period
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 11. EXHIBITS.
The following exhibits are attached to this Form N-CSR:
Exhibit No. DESCRIPTION OF EXHIBIT
11 (b) (1) Certification of Principal Executive Officer Pursuant to Section
302 of the Sarbanes-Oxley Act of 2002
11 (b) (2) Certification of Principal Financial Officer Pursuant to Section
302 of the Sarbanes-Oxley Act of 2002
11 (c) Certification of Principal Executive Officer and Principal
Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant): AllianceBernstein Municipal Income Fund, Inc.
By: /s/ Marc O. Mayer
---------------------
Marc O. Mayer
President
Date: June 29, 2005
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Marc O. Mayer
---------------------
Marc O. Mayer
President
Date: June 29, 2005
By: /s/ Mark D. Gersten
---------------------
Mark D. Gersten
Treasurer and Chief Financial Officer
Date: June 29, 2005