October 19, 2009
Ms. Patsy Mengiste
Securities and Exchange Commission
100 F Street, N.E.
Washington, D.C. 20549
ATTN.: Document Control - EDGAR
RE: RIVERSOURCE BOND SERIES, INC. (FILE NOS. 002-72174 / 811-3178)
N-CSR for the annual report for the period ended July 31, 2008 for each
of:
RiverSource Floating Rate Fund
RiverSource Income Opportunities Fund
RiverSource Inflation Protected Securities Fund
RiverSource Limited Duration Bond Fund
RIVERSOURCE CALIFORNIA TAX-EXEMPT TRUST (FILE NOS. 33-5103 / 811-4646)
N-CSR for the annual report for the period ended Aug. 31, 2008 for:
RiverSource California Tax-Exempt Fund
RIVERSOURCE DIMENSIONS SERIES, INC. (FILE NOS. 2-28529 / 811-1629)
N-CSR for the annual report for the period ended July 31, 2008 for each
of:
RiverSource Disciplined Small and Mid Cap Equity Fund
RiverSource Disciplined Small Cap Value Fund
RIVERSOURCE EQUITY SERIES, INC. (FILE NOS. 2-13188 / 811-772)
N-CSR for the annual report for the period ended Nov. 30, 2008 for:
RiverSource Mid Cap Growth Fund
RIVERSOURCE GLOBAL SERIES, INC. (FILE NOS. 33-25824 / 811-5696)
N-CSR for the annual report for the period ended Oct. 31, 2008 for each
of:
RiverSource Absolute Return Currency and Income Fund
RiverSource Emerging Markets Bond Fund
RiverSource Global Bond Fund
Threadneedle Global Equity Income Fund
Threadneedle Global Extended Alpha Fund
RIVERSOURCE GOVERNMENT INCOME SERIES, INC. (FILE NOS. 2-96512 / 811-4260)
N-CSR for the annual report for the period ended May 31, 2008 for:
RiverSource U.S. Government Mortgage Fund
RIVERSOURCE INCOME SERIES, INC. (FILE NOS. 2-10700 / 811-499)
N-CSR for the annual report for the period ended Jan. 31, 2009 for each
of:
RiverSource Income Builder Basic Income Fund
RiverSource Income Builder Enhanced Income Fund
RiverSource Income Builder Moderate Income Fund
RIVERSOURCE INTERNATIONAL MANAGERS SERIES, INC. (FILE NOS. 333-64010 /
811-10427)
N-CSR for the annual report for the period ended Oct. 31, 2008 for each
of:
RiverSource Partners International Select Value Fund
RiverSource Partners International Small Cap Fund
RIVERSOURCE INTERNATIONAL SERIES, INC. (FILE NOS. 2-92309 / 811-4075)
N-CSR for the annual report for the period ended Oct. 31, 2008 for each
of:
RiverSource Disciplined International Equity Fund
Threadneedle European Equity Fund
Threadneedle International Opportunity Fund
RIVERSOURCE INVESTMENT SERIES, INC. (FILE NOS. 2-11328 / 811-54)
N-CSR for the annual report for the period ended Sept. 30, 2008 for each
of:
RiverSource Disciplined Large Cap Growth Fund
RiverSource Disciplined Large Cap Value Fund
RiverSource Diversified Equity Income Fund
RiverSource Mid Cap Value Fund
Page 1 of 7
RIVERSOURCE MANAGERS SERIES, INC. (FILE NOS. 333-57852 / 811-10321)
N-CSR for the annual report for the period ended May 31, 2008 for each
of:
RiverSource Partners Aggressive Growth Fund
RiverSource Partners Fundamental Value Fund
RiverSource Partners Select Value Fund
RiverSource Partners Small Cap Equity Fund
RiverSource Partners Small Cap Value Fund
RIVERSOURCE MARKET ADVANTAGE SERIES, INC. (FILE NOS. 33-30770 / 811-5897)
N-CSR for the annual report for the period ended Jan. 31, 2009 for each
of:
RiverSource S&P 500 Index Fund
RiverSource Small Company Index Fund
RIVERSOURCE MONEY MARKET SERIES, INC. (FILE NOS. 2-54516 / 811-2591)
N-CSR for the annual report for the period ended July 31, 2008 for:
RiverSource Cash Management Fund
RIVERSOURCE SECTOR SERIES, INC. (FILE NOS. 33-20872 / 811-5522)
N-CSR for the annual report for the period ended June 30, 2008 for each
of:
RiverSource Dividend Opportunity Fund
RiverSource Real Estate Fund
RIVERSOURCE SELECTED SERIES, INC. (FILE NOS. 2-93745 / 811-4132)
N-CSR for the annual report for the period ended March 31, 2008 for:
RiverSource Precious Metals and Mining Fund
RIVERSOURCE SERIES TRUST (FILE NOS. 333-131683 / 811-21852)
N-CSR for the annual report for the period ended April 30, 2008
for each of:
RiverSource 120/20 Contrarian Equity Fund
RiverSource Retirement Plus 2010 Fund
RiverSource Retirement Plus 2015 Fund
RiverSource Retirement Plus 2020 Fund
RiverSource Retirement Plus 2025 Fund
RiverSource Retirement Plus 2030 Fund
RiverSource Retirement Plus 2035 Fund
RiverSource Retirement Plus 2040 Fund
RiverSource Retirement Plus 2045 Fund
RIVERSOURCE SHORT-TERM INVESTMENTS SERIES, INC. (FILE NO. 811-21914)
N-CSR for the annual report for the period ended July 31, 2008 for:
RiverSource Short-Term Cash Fund
RIVERSOURCE SPECIAL TAX-EXEMPT SERIES TRUST (FILE NOS. 33-5102 / 811-4647)
N-CSR for the annual report for the period ended Aug. 31, 2008 for each
of:
RiverSource Minnesota Tax-Exempt Fund
RiverSource New York Tax-Exempt Fund
RIVERSOURCE STRATEGIC ALLOCATION SERIES, INC. (FILE NOS. 2-93801 / 811-4133)
N-CSR for the annual report for the period ended Sept. 30, 2008 for each
of:
RiverSource Strategic Allocation Fund
RiverSource Strategic Income Allocation Fund
RIVERSOURCE STRATEGY SERIES, INC. (FILE NOS. 2-89288 / 811-3956)
N-CSR for the annual report for the period ended March 31, 2008 for:
RiverSource Partners Small Cap Growth Fund
RIVERSOURCE TAX-EXEMPT INCOME SERIES, INC. (FILE NOS. 2-63552 / 811-2901)
N-CSR for the annual report for the period ended Nov. 30, 2008 for:
RiverSource Tax-Exempt High Income Fund
RIVERSOURCE TAX-EXEMPT MONEY MARKET SERIES, INC. (FILE NOS. 2-66868 /
811-3003)
N-CSR for the annual report for the period ended Dec. 31, 2008 for:
RiverSource Tax-Exempt Money Market Fund
RIVERSOURCE TAX-EXEMPT SERIES, INC. (FILE NOS. 2-57328 / 811-2686)
N-CSR for the annual report for the period ended Nov. 30, 2008 for each
of:
RiverSource Intermediate Tax-Exempt Fund
RiverSource Tax-Exempt Bond Fund
Page 2 of 7
SELIGMAN CAPITAL FUND, INC. (FILE NOS. 002-33566 / 811-01886)
N-CSR for the annual report for the period ended Dec. 31, 2008
SELIGMAN CASH MANAGEMENT FUND, INC. (CURRENTLY KNOWN AS RIVERSOURCE
GOVERNMENT MONEY MARKET FUND, INC.) FILE NOS. 002-56805 / 811-02650)
N-CSR for the annual report for the period ended Dec. 31, 2008
SELIGMAN COMMUNICATIONS AND INFORMATION FUND, INC. (FILE NOS. 002-80168 /
811-03596)
N-CSR for the annual report for the period ended Dec. 31, 2008
SELIGMAN FRONTIER FUND, INC. (FILE NOS. 002-92487 / 811-04078)
N-CSR for the annual report for the period ended Oct. 31, 2008
SELIGMAN LASALLE INTERNATIONAL REAL ESTATE FUND, INC. (CURRENTLY KNOWN AS \
RIVERSOURCE LASALLE INTERNATIONAL REAL ESTATE FUND, INC.)
(FILE NOS. 333-141258 / 811-22031)
N-CSR for the annual report for the period ended Dec. 31, 2008
SELIGMAN LASALLE REAL ESTATE FUND SERIES, INC. (FILE NOS. 333-105799 /
811-21365)
N-CSR for the annual report for the period ended Dec. 31, 2008 for each
of:
Seligman LaSalle Global Real Estate Fund (currently known as
RiverSource LaSalle Global Real Estate Fund)
Seligman LaSalle Monthly Dividend Real Estate Fund (currently known as
RiverSource LaSalle Monthly Dividend Real Estate Fund)
SELIGMAN TARGETHORIZON ETF PORTFOLIOS, INC. (FILE NOS. 333-126647 /
811-21788)
N-CSR for the annual report for the period ended Sept. 30, 2008 for each
of:
Seligman TargETFund 2015
Seligman TargETFund 2025
Seligman TargETFund 2035
Seligman TargETFund 2045
Seligman TargETFund Core
TRI-CONTINENTAL CORPORATION (FILE NOS. 333-104669 / 811-00266)
N-CSR for the annual report for the period ended Dec. 31, 2008
Dear Ms. Mengiste:
This letter responds to your comments received by telephone on July 31, 2009 for
the above-referenced Funds' annual reports filed on Form N-CSR for the periods
indicated. Comments 1 through 9 represent previous comments received on April 3,
2009 that are considered applicable to this group of funds.
COMMENT 1: For applicable Fund shareholder reports, please revise the graph
depicting the Fund's long-term performance to improve the ability to distinguish
between the lines representing the Fund and its comparative indices.
RESPONSE: The graph has been redesigned to better distinguish between the
lines representing a Fund and its comparative indices. Design changes
include the following: varying line thickness and shading, minimizing the
scale used for the vertical axis and increasing the frequency of plot
points.
COMMENT 2: In general, at fiscal year end or subsequent thereto, have the Funds
experienced any issues with regard to liquidity, valuation, pricing or
redemptions? If so, to what extent?
RESPONSE: During the period, no Fund experienced liquidity issues impacting
its investment operations or its ability to satisfy redemption requests,
and no Fund experienced material pricing or valuation issues. Because of
the volatility of the recent market environment, however, Fund management
has spent increased time and effort to assess the adequacy and sufficiency
of its pricing and valuation procedures.
COMMENT 3: In particular with regards to defaulted portfolio securities, at
fiscal year end or subsequent thereto, have the Funds experienced any material
issues with regard to pricing or liquidity? If so, to what extent?
Page 3 of 7
RESPONSE: During the period, no Fund experienced a liquidity issue as a
result of defaulted portfolio securities, and there were no issues related
to the pricing and valuation of such securities. Fund management continues
to adhere to its process for monitoring defaulted portfolio securities.
COMMENT 4: With regards to securities on loan, please describe the Funds' policy
with regard to the collateral received. Is the collateral invested? Have there
been any problems with pricing of the collateral? Also, please explain whether
the Funds' retain voting authority for securities on loan.
RESPONSE: All funds in the RiverSource Family of Funds have a Securities
Lending Agreement (the Agreement) with JPMorgan Chase Bank, National
Association (JPMorgan) that authorizes JPMorgan as securities lending agent
to lend securities to authorized borrowers on behalf of the Funds. The
Funds retain discretionary authority to recall securities on loan in order
to vote proxies. The Funds have not had any issues with collateral
including the pricing of collateral. Additional background regarding the
securities lending program is included in the shareholder reports for those
Funds that participate in the securities lending program substantially as
follows.
Pursuant to the Agreement, the securities loaned are secured by cash or
U.S. government securities equal to at least 100% of the market value of
the loaned securities. Any additional collateral required to maintain those
levels due to market fluctuations of the loaned securities is delivered the
following business day. Cash collateral received is invested by the lending
agent on behalf of the Fund into authorized investments pursuant to the
Agreement. The investments made with the cash collateral are listed in the
Portfolio of Investments. The values of such investments and any uninvested
cash collateral balance are disclosed in the Statement of Assets and
Liabilities along with the related obligation to return the collateral upon
the return of the securities loaned. At [date], securities valued at [$]
were on loan, secured by cash collateral of [$] invested in short-term
securities or in cash equivalents.
Risks of delay in recovery of securities or even loss of rights in the
securities may occur should the borrower of the securities fail
financially. Risks may also arise to the extent that the value of the
securities loaned increases above the value of the collateral received.
JPMorgan will indemnify the Fund from losses resulting from a borrower's
failure to return a loaned security when due. Such indemnification does not
extend to losses associated with declines in the value of cash collateral
investments. Loans are subject to termination by the Fund or the borrower
at any time, and are, therefore, not considered to be illiquid investments.
Pursuant to the Agreement, the Fund receives income for lending its
securities either in the form of fees or by earning interest on invested
cash collateral, net of negotiated rebates paid to borrowers and fees paid
to the lending agent for services provided and any other securities lending
expenses. Income of [$] earned from securities lending from [date] to
[date] is included in the Statement of Operations. The Fund also continues
to earn interest and dividends on the securities loaned.
COMMENT 5: To the extent a Fund has a high rate of portfolio turnover, please
highlight it in the MDFP.
RESPONSE: Funds that have experienced a high rate of portfolio turnover
during the last fiscal year will highlight the portfolio turnover in the
MDFP.
COMMENT 6: Please supplementally describe the circumstances under which cash
collateral for securities lending is held with the broker instead of the
custodian.
RESPONSE: JPMorgan acts as the custodian and the securities lending agent
for all funds in the RiverSource Family of Funds, as described above in the
Response to Comment 4. Under the Securities Lending Agreement, JPMorgan
holds cash collateral from securities lending for each Fund in a segregated
account that is separate from each Fund's primary custodial accounts. Cash
collateral is not held by brokers that receive loaned securities.
COMMENT 7: In the Notes to Portfolio of Investments, please include the
percentage of Fund assets held in illiquid securities.
Page 4 of 7
RESPONSE: The percentage of Fund assets held in illiquid securities will be
added to the applicable footnote to the list of Portfolio of Investments.
COMMENT 8: For the Seligman Fund shareholder reports, please explain whether
mortgage dollar rolls are included in Fund borrowing.
RESPONSE: The Seligman Funds account for mortgage dollar rolls as discrete
transactions and record a gain or loss on the sale of the initial security
purchased. The payable for the new security purchased is included within
the line item "Payable for securities purchased" in the Statement of Assets
and Liabilities. They are not treated as borrowings. If the settlement date
of the new security purchased is beyond trade date + 3, the Fund segregates
assets of equal or greater value to cover its purchase obligation.
COMMENT 9: For the RiverSource and Threadneedle Fund shareholder reports,
supplementally explain what "worst of call options" are.
RESPONSE: A worst-of-call option is an over-the-counter options contract
comprised of a basket, or bundle, of call options all with the same
expiration dates but for different underlying assets. On the expiration
date, only the worst performing option (the option where the percentage
move in the price of the underlying asset from trade date to expiration
date is the least) will be exercised.
COMMENT 10: Instructions 5 and 6 to Item 27(b)(7) of New Form N-1A discuss the
appropriate indices to use in comparing a Fund's performance. In certain Fund
reports (i.e., RiverSource Retirement Plus Funds) there may be up to five
indices included in the line graph. Consider limiting the comparison to no more
than three indices (a broad-based, an additional broad-based and a
non-securities).
RESPONSE: In most instances the comparison is limited to two indices, a
broad-based securities market index and a Lipper index. However, there may
be times when more than two indices are included. For instance, as outlined
in Instruction 7 to Item 27(b)(7), if a Fund uses an index that is
different from the one used for the immediately preceding fiscal year, the
comparison needs to include the new and former indices for one year. In the
case of certain other funds, such as the Retirement Plus Funds, blended
indices are used. When blended indices are used, all components of such
blend are also included.
COMMENT 11: Rule 6-07(2)(b) of Regulation S-X requires that any other expense
item the amount of which exceeds five percent of the total expenses shown on the
Statement of Operations should be stated separately. Please confirm that there
is no single item within the "Miscellaneous" or "Other" expense line on the
Statement of Operations that exceeds this five percent rule.
RESPONSE: We have confirmed that there is no single item within the
category of "Miscellaneous" or "Other" that exceeded the five percent rule
to which the item would need to be stated separately.
COMMENT 12: Certain Funds have a line item on the Statement of Assets and
Liabilities entitled "Bank overdraft." In the Note on Borrowing there is no
reference to such a bank overdraft. Supplementally explain what these are.
RESPONSE: A "Bank overdraft" as reported on the Statement of Assets and
Liabilities results from a temporary shortfall of cash due to, for example,
a failed portfolio sale transaction or a capital stock exchange out. The
overdraft is funded by the Fund's custodian bank only. The amounts are
usually small or are covered the next day. We consider a "Borrowing" to
occur when the Fund makes a specific drawdown on the credit facility
described in the footnote. These are usually larger in amount and expected
to be outstanding for at least several days. The footnote was referring
only to borrowings that would occur under the credit facility described in
the footnote. None of the amounts reported as "Bank overdraft" on the
Statement of Assets and Liabilities were related to borrowing on the credit
facility.
COMMENT 13: On the Statement of Assets and Liabilities in the RiverSource State
Tax-Exempt Funds 2008 Annual Report there is a line item entitled "Short term
floating rate notes outstanding." Supplementally explain whether these floating
rate notes are considered senior securities. If so, how do they meet
requirements of Section 18 of the Investment Company Act of 1940?
Page 5 of 7
RESPONSE: The liability for short-term floating rate notes outstanding
reported on the Statement of Assets and Liabilities results from the
consolidation of special purpose bond trusts for GAAP financial reporting
purposes. The floating rate notes are issued by the special purpose bond
trust, and are not senior securities issued by the Fund.
Certain municipal bonds are acquired by the Fund and sold to a
broker-dealer who then consolidates the bonds into special purpose bond
trusts in exchange for cash and residual interests in the trust's assets
and cash flows, which are in the form of inverse floating rate securities.
The trusts fund the purchases of the municipal bonds by issuing short-term
floating rate notes to third parties. The bonds held by the trusts serve as
collateral for the short-term floating rate notes outstanding. The residual
interests held by each Fund (inverse floating rate securities) include the
right of each Fund (1) to cause the holders of the short-term floating rate
notes to tender their notes at par, and (2) to transfer the municipal bonds
from the trusts to each Fund, thereby collapsing the trusts. The Fund
consolidates the bond trusts and the short-term floating rate notes issued
by the bond trusts. As such, the municipal bonds transferred to the trusts
are reported in each Fund's investments in securities and the related
short-term floating rate notes are reflected as Fund liabilities under the
caption "Short term floating rate notes outstanding" in the Statement of
Assets and Liabilities.
COMMENT 14: On the Statement of Assets and Liabilities in the Seligman LaSalle
Real Estate Fund Series 2008 Annual Report there are two line items: (1) Under
the Assets portion: Receivable from the Manager (Note 4a), and (2) Under the
Liabilities portion: Management fee payable. Supplementally explain what these
items are and represent that such items will be explained in the Notes to
Financials in the future.
RESPONSE: The amount reported as an "Asset" is the amount payable by the
Manager to the Fund for reimbursement of fund expenses as of December 31,
2008 due to the expense limitation in place. The amount reported as a
"Liability" is the full amount of the management fee payable at December
31, 2008. Each amount is settled with or by the Fund promptly after
month-end. However, we do not net the amounts in the Statement of Assets
and Liabilities. These arrangements are thoroughly described in Note 4a to
the Financial Statements in the Seligman LaSalle Real Estate Fund Series
2008 Annual Report and will continue to be explained in future reports, if
applicable.
COMMENTS 15: In Note 2(d) to the Financial Statements in the Seligman
Communications and Information Fund 2008 Annual Report, restricted cash
references that it is related to "the Fund's insurance policies." Supplementally
explain this arrangement and the circumstances and conditions to which this will
occur in the future.
RESPONSE: The Fund, as a part of the Seligman Group of Funds, maintained a
joint fidelity bond and D&O/E&O Liability Insurance policy with ICI Mutual
Insurance Company until November 2008. When the ICI arrangement started in
1989, the Fund was required to arrange for a bank to issue a letter of
credit for the benefit of ICI Mutual to assist ICI Mutual in raising
capital. The bank that issued the letter of credit required the Fund to
deposit cash as collateral with the bank equal to the face amount of the
letter of credit. The Fund was restricted from withdrawing this cash as
long as the letter of credit was outstanding. In connection with the
acquisition of Seligman by RiverSource in November 2008, the Seligman Funds
cancelled their insurance policies with ICI Mutual and became additional
insureds on the policies maintained by the RiverSource funds. With the
cancellation of the insurance policies, the Fund also cancelled the letter
of credit and received back from the bank the cash deposit. It is not
expected that a similar arrangement will be needed in the future.
COMMENT 16: Provide a representation that the auditors' opinions cover the
schedule of investments in securities. If a summary schedule of investments in
securities is used, as outlined in Instruction 1 to Item 27(b)(1) of New Form
N-1A, please represent that a separate opinion has been issued for the full
schedule of investments in securities.
RESPONSE: The auditors' opinions for all funds in the RiverSource Family of
Funds (RiverSource, Threadneedle and Seligman funds) cover the financial
statements in their entirety, including the schedule of investments. None
of the Funds use a summary schedule of investments. For example, the
auditor's opinion on page 33 of the 2008 Annual Report for Seligman
Communications and Information Fund states in the opening sentence, "[w]e
have audited the accompanying statement of assets and liabilities of
Seligman Communications and Information Fund, Inc. (the "Fund"), INCLUDING
THE PORTFOLIO OF INVESTMENTS, as of December 31,
Page 6 of 7
2008....(emphasis added)" The auditors' opinions for other Funds contain
similar wording in the first sentence of the first paragraph of the
opinion.
COMMENT 17: In Note 8 to the Financial Statements in the RiverSource Cash
Management Fund 2008 Annual Report there is reference to a cash infusion by
Ameriprise Financial, Inc. Supplementally explain how it was accounted for.
RESPONSE: The Subsequent Event as disclosed in Note 8 to the Financial
Statements in the RiverSource Cash Management Fund 7/31/08 Annual Report
relates to the purchases made between September 16 - 22, 2008 by Ameriprise
Financial of positions of Lehman Brothers variable rate notes held by the
Fund. Purchases made by Ameriprise Financial were for cash at a price equal
to amortized cost plus accrued interest in accordance with Rule 17a-9 under
the Investment Company Act of 1940, as amended. The Fund recorded these
transactions as "Increase from payments by affiliate (Note 6)" on the
Statement of Operations for the fiscal year ended July 31, 2009 equal to
the aggregate difference between the fair value of the Lehman Notes at each
purchase date and the cash received from Ameriprise Financial.
The following disclosure relating to the aforementioned purchases of the
Lehman Notes by Ameriprise Financial is included in Note 6 to the Financial
Statements in the 2009 Annual Report for the Fund:
On Sept. 15, 2008, Lehman Brothers Holdings Inc. (Lehman Brothers) filed a
Chapter 11 bankruptcy petition. At that time, the Fund owned $40 million in
medium term commercial paper issued by Lehman Brothers (the Lehman Notes).
The value of the Lehman Notes declined following Lehman Brothers filing of
its bankruptcy petition. From Sept. 16, 2008 through Sept. 30, 2008,
Ameriprise Financial purchased the total $40 million par of the Lehman
Notes from the Fund for cash at a price equal to amortized cost plus
accrued interest in accordance with Rule 17a-9 of the 1940 Act. The Fund
recorded $30.3 million as a payment by affiliate, which is equal to the
aggregate difference between the fair value of the Lehman Notes at each
purchase date and the cash received from Ameriprise Financial.
In connection with the N-CSR filings identified above for the above-referenced
Registrants, each Registrant hereby acknowledges the following:
The disclosures in the filing are the responsibility of the Registrant and
the Registrant is fully responsible for the adequacy or accuracy of the
disclosures in this filing. The Registrant represents to the Commission
that comments made by the Commission, or the staff acting pursuant to
delegated authority, or changes to disclosure in response to staff comments
in the filing reviewed by the staff, do not foreclose the Commission from
taking any action with respect to the filing, and the Registrant represents
that it will not assert this action as a defense in any proceeding
initiated by the Commission or any person, under the federal securities
laws of the United States.
If you have any questions, please contact either me at 612-671-4321 or Heidi
Brommer at 612-671-2403.
Sincerely,
/s/ Christopher O. Petersen
---------------------------------------
Christopher O. Petersen
Vice President and Group Counsel
Ameriprise Financial, Inc.
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