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 811-6362
Van Kampen Municipal Trust
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
1221 Avenue of the Americas New York, New York 10020
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(Address of principal executive offices) (Zip code)
Ronald Robison
1221 Avenue of the Americas New York, New York 10020
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(Name and address of agent for service)
Registrant's telephone number, including area code: 212-762-4000
Date of fiscal year end: 10/31
Date of reporting period: 10/31/04
Item 1. Reports to Shareholders.
The Trust's annual report transmitted to shareholders pursuant to Rule 30e-1
under the Investment Company Act of 1940 is as follows:
Welcome, Shareholder
In this report, you'll learn about how your investment in Van Kampen
Municipal Trust performed during the annual period. The portfolio
management team will provide an overview of the market conditions and
discuss some of the factors that affected investment performance during
the reporting period. In addition, this report includes the trust's
financial statements and a list of trust investments as of October 31,
2004.
MARKET FORECASTS PROVIDED IN THIS REPORT MAY NOT NECESSARILY COME TO
PASS. THERE IS NO ASSURANCE THAT THE TRUST WILL ACHIEVE ITS INVESTMENT
OBJECTIVE. TRUSTS ARE SUBJECT TO MARKET RISK, WHICH IS THE POSSIBILITY
THAT THE MARKET VALUES OF SECURITIES OWNED BY THE TRUST WILL DECLINE AND
THAT THE VALUE OF TRUST SHARES MAY THEREFORE BE LESS THAN WHAT YOU PAID
FOR THEM. ACCORDINGLY, YOU CAN LOSE MONEY INVESTING IN THIS TRUST.
INCOME MAY SUBJECT CERTAIN INDIVIDUALS TO THE FEDERAL ALTERNATIVE MINIMUM
TAX (AMT).
<Table>
<Caption>
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NOT FDIC INSURED OFFER NO BANK GUARANTEE MAY LOSE VALUE
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NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY NOT A DEPOSIT
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</Table>
Performance Summary as of 10/31/04
<Table>
<Caption>
MUNICIPAL TRUST
SYMBOL: VKQ
- ---------------------------------------------------------
AVERAGE ANNUAL BASED ON BASED ON
TOTAL RETURNS NAV MARKET PRICE
Since Inception (9/27/91) 7.81% 6.93%
10-year 8.36 8.03
5-year 9.46 9.32
1-year 9.03 9.15
- ---------------------------------------------------------
</Table>
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. FOR THE MOST RECENT MONTH-END PERFORMANCE FIGURES, PLEASE VISIT
VANKAMPEN.COM OR SPEAK WITH YOUR FINANCIAL ADVISOR. INVESTMENT RETURNS, NET
ASSET VALUE (NAV) AND COMMON SHARE MARKET PRICE WILL FLUCTUATE AND TRUST SHARES,
WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST.
NAV per share is determined by dividing the value of the trust's portfolio
securities, cash and other assets, less all liabilities, by the total number of
common shares outstanding. The common share market price is the price the market
is willing to pay for shares of the trust at a given time. Common share market
price is influenced by a range of factors, including supply and demand and
market conditions. Total return assumes an investment at the beginning of the
period, reinvestment of all distributions for the period in accordance with the
trust's dividend reinvestment plan, and sale of all shares at the end of the
period.
The Lehman Brothers Municipal Bond Index is a broad-based statistical composite
of municipal bonds. The index does not include any expenses, fees or sales
charges, which would lower performance. The index is unmanaged and should not be
considered an investment. It is not possible to invest directly in an index.
1
Trust Report
FOR THE 12-MONTH PERIOD ENDED OCTOBER 31, 2004
Van Kampen Municipal Trust is managed by the Adviser's Municipal Fixed Income
team.(1) Current members include Thomas Byron, Vice President; Robert Wimmel,
Vice President; and John Reynoldson, Executive Director.
MARKET CONDITIONS
The interest-rate environment of the 12 months ended October 31, 2004 was marked
by two periods of steadily declining yields, with a significant sell-off in the
middle. Yields fell steadily through the first half of the period, approaching
the historical lows of 2003. This trend persisted until March, at which point
yields reversed direction and began an upward march as prices fell. These losses
were steepest in April, as a surprisingly strong employment report and signals
from members of the Federal Open Market Committee (the Fed) caused investors to
expect a near-term rate increase. Rates went on to decline from May through the
end of the period as the market digested the Fed's newly hawkish rate stance.
Investors were further comforted when, after the Fed raised rates at its June
30, 2004 meeting, its members indicated that the path of future rate increases
would be measured.
Unusually, longer-maturity securities largely outperformed in this period of Fed
tightening. Historically, the typical pattern in periods of tightening policy
has seen yields rise across all maturities. During the review period, however,
yields of shorter maturity bonds rose while those of bonds with longer
maturities declined slightly.
Lower-quality municipal bonds also performed strongly in this environment, as
the difference in yields (known as the "yield spread") between AAA and BBB rated
bonds decreased by roughly 20 basis points for 20-year bonds. As a result,
sectors with heavy exposure to lower-rated debt, such as hospitals and
industrial-revenue bonds, posted higher total returns than sectors dominated by
higher-rated debt.
Issuance for the first 10 months of 2004 (the final 10 months of the review
period) was roughly six percent lower than in the same period in 2003. That
said, 2003 was a record year, and at the current pace of issuance, 2004 could
well be one of the largest years in recent memory. The strong supply met with
faltering demand from mutual funds, as fund investors withdrew over $15 billion
in net cash during the period. The faltering demand was largely offset by
increased participation in the market by insurance companies and individual
investors.
(1)Team members may change without notice at any time.
2
PERFORMANCE ANALYSIS
The trust's return can be calculated based upon either the market price or the
net asset value (NAV) of its shares. NAV per share is determined by dividing the
value of the trust's portfolio securities, cash and other assets, less all
liabilities, by the total number of common shares outstanding, while market
price reflects the supply and demand for the shares. As a result, the two
returns can differ significantly. On both an NAV basis and a market price basis,
the trust outperformed its benchmark index, the Lehman Brothers Municipal Bond
Index. (See table below.)
The trust uses leverage to enhance its dividend to common shareholders. The
trust borrows money at short-term rates through the issuance of preferred
shares. The proceeds are reinvested in longer-term securities, taking advantage
of the difference between short- and longer-term rates. The Fed's policy of
raising interest rates in the final months of the period made the trust's
borrowing activity more expensive. These expenses, however, were more than
offset by the strong performance of the bonds the trust invested in, leading to
the portfolio's outperformance versus its benchmark, which is unleveraged.
The historically low level of interest rates led us to maintain the trust's
overall interest-rate sensitivity at a level below that of its benchmark. This
strategy helped shield the trust from negative returns during those times when
yields rose. That said, yields overall declined over the period, and the
strategy exerted a drag on performance.
The fund experienced significant call activity during the period, as issuers
sought to lower their interest costs by refinancing their bonds at lower market
rates. This activity involved 23 percent of the total sales activity in the
trust. We reinvested the proceeds into bonds that we believed had more favorable
prospects for total return. Many of these securities were in the 15- to 20-year
segment of the market, which our analysis indicated offered the most appealing
combination of value and total-return potential.
In keeping with our long-term approach, we bought and sold bonds at the long end
of the market as they came into and out of fair value. This strategy entails
TOTAL RETURN FOR THE 12-MONTH PERIOD ENDED OCTOBER 31, 2004
<Table>
<Caption>
- --------------------------------------------------------------
BASED ON BASED ON LEHMAN BROTHERS
NAV MARKET PRICE MUNICIPAL BOND INDEX
9.03% 9.15% 6.03%
- --------------------------------------------------------------
</Table>
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF
FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES
SHOWN. INVESTMENT RETURN, NET ASSET VALUE AND COMMON SHARE MARKET PRICE WILL
FLUCTUATE AND TRUST SHARES, WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR
ORIGINAL COST. SEE PERFORMANCE SUMMARY FOR ADDITIONAL PERFORMANCE INFORMATION
AND INDEX DEFINITION.
3
purchasing bonds with attractive total-return prospects and selling them once
they have reached our performance targets. Many of our purchases in this
strategy involved health-care bonds, which offered attractive valuations for
much of the period.
We remained focused on controlling the trust's risk profile through attention to
credit quality and diversification. By the end of the 12-month period, 83
percent of the trust's total investments were invested in bonds rated AAA and
AA; these represent the two highest tiers of credit ratings. The portfolio was
also well diversified across the major sectors of the municipal bond market. Its
three largest sector exposures were general purpose, public education, and
transportation.
While it is impossible to predict the exact turning point when interest rates
will move decisively higher, we believe the trust remains well positioned for
the near future. We will continue to search the municipal bond markets for
interesting opportunities.
There is no guarantee that any securities mentioned will continue to perform
well or be held by the trust in the future.
4
<Table>
<Caption>
RATINGS ALLOCATION AS OF 10/31/04
AAA/Aaa 72.2%
AA/Aa 10.8
A/A 4.5
BBB/Baa 3.4
BB/Ba 1.7
B/B 0.2
Non-Rated 7.2
<Caption>
TOP 5 SECTORS AS OF 10/31/04
General Purpose 20.5%
Public Education 10.4
Transportation 9.9
Public Building 9.0
Health Care 8.6
<Caption>
SUMMARY OF INVESTMENTS BY STATE CLASSIFICATION AS OF 10/31/04
Illinois 10.1%
California 9.6
New York 8.6
New Jersey 7.0
Texas 6.7
Florida 6.7
Ohio 4.2
Pennsylvania 4.0
Washington 3.7
Connecticut 3.7
North Carolina 3.1
Louisiana 2.7
Massachusetts 2.7
Georgia 2.5
Michigan 2.4
Alabama 2.2
Missouri 1.8
Kentucky 1.5
Virginia 1.5
Oregon 1.4
Colorado 1.3
Nevada 1.1
Tennessee 1.1
Indiana 1.0
Maryland 0.9
New Hampshire 0.9
West Virginia 0.7
Kansas 0.7
District of Columbia 0.7
Puerto Rico 0.7
Oklahoma 0.6
Wisconsin 0.6
Guam 0.6
Arizona 0.5
South Carolina 0.5
(continued on next page)
</Table>
5
<Table>
<Caption>
SUMMARY OF INVESTMENTS BY STATE CLASSIFICATION AS OF 10/31/04
(continued from previous page)
Arkansas 0.5%
Mississippi 0.3
Rhode Island 0.3
South Dakota 0.2
Hawaii 0.2
New Mexico 0.2
Alaska 0.1
Maine 0.1
Nebraska 0.1
-----
Total Investments 100.0%
</Table>
Subject to change daily. Provided for informational purposes only and should not
be deemed as a recommendation to buy or sell the securities mentioned or
securities in the sectors shown above. Ratings and summary of investments by
state classification are as a percentage of total investments. Sectors are as a
percentage of long-term investments. Securities are classified by sectors that
represent broad groupings of related industries. Van Kampen is a wholly owned
subsidiary of a global securities firm which is engaged in a wide range of
financial services including, for example, securities trading and brokerage
activities, investment banking, research and analysis, financing and financial
advisory services. Rating allocations based upon ratings as issued by Standard
and Poor's and Moody's, respectively.
6
FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS
Each Van Kampen trust provides a complete schedule of portfolio holdings
in its semiannual and annual reports within 60 days of the end of the
trust's second and fourth fiscal quarters by filing the schedule
electronically with the Securities and Exchange Commission (SEC). The
semiannual reports are filed on Form N-CSRS and the annual reports are
filed on Form N-CSR. Van Kampen also delivers the semiannual and annual
reports to trust shareholders, and makes these reports available on its
public web site, www.vankampen.com. In addition to the semiannual and
annual reports that Van Kampen delivers to shareholders and makes
available through the Van Kampen public web site, each trust files a
complete schedule of portfolio holdings with the SEC for the trust's
first and third fiscal quarters on Form N-Q. Van Kampen does not deliver
the reports for the first and third fiscal quarters to shareholders, nor
are the reports posted to the Van Kampen public web site. You may,
however, obtain the Form N-Q filings (as well as the Form N-CSR and
N-CSRS filings) by accessing the SEC's web site, http://www.sec.gov. You
may also review and copy them at the SEC's Public Reference Room in
Washington, DC. Information on the operation of the SEC's Public
Reference Room may be obtained by calling the SEC at 1-202-942-8090. You
can also request copies of these materials, upon payment of a duplicating
fee, by electronic request at the SEC's e-mail address
(publicinfo@sec.gov) or by writing the Public Reference section of the
SEC, Washington, DC 20549-0102.
In addition to filing a complete schedule of portfolio holdings with the
SEC each fiscal quarter, each Van Kampen trust makes portfolio holdings
information available by periodically providing the information on its
public web site, www.vankampen.com. Each Van Kampen trust provides a
complete schedule of portfolio holdings on the public web site on a
calendar-quarter basis approximately 30 days after the close of the
calendar quarter. Van Kampen closed-end funds do not presently provide
partial lists of their portfolio holdings on a monthly basis, but may do
so in the future.
You may obtain copies of a trust's fiscal quarter filings, or its monthly
or calendar-quarter web site postings, by contacting Van Kampen Client
Relations at 1-800-847-2424.
PROXY VOTING POLICIES AND PROCEDURES AND PROXY VOTING RECORD
The trust's policies and procedures with respect to the voting of proxies
relating to the trust's portfolio securities and information on how the
trust voted proxies relating to portfolio securities during the most
recent twelve-month period ended June 30 is available without charge,
upon request, by calling 1-800-847-2424 or by visiting our web site at
www.vankampen.com. This information is also available on the Securities
and Exchange Commission's web site at http://www.sec.gov.
7
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
MUNICIPAL BONDS 148.1%
ALABAMA 3.3%
$1,000 Birmingham Baptist Med Ctr AL Baptist Hlth Sys
Ser A.......................................... 5.875% 11/15/24 $ 1,042,280
2,695 Gadsden, AL Wts Ser B (AMBAC Insd)............. 5.250 08/01/21 2,955,418
4,000 Jefferson Cnty, AL Swr Rev Cap Impt Wts
(Prerefunded @ 08/01/12) (FGIC Insd)........... 5.125 02/01/42 4,506,800
6,215 Jefferson Cnty, AL Swr Rev Cap Impt Wts Ser A
(Prerefunded @ 02/01/11) (FGIC Insd)........... 5.000 02/01/41 6,932,025
1,735 Jefferson Cnty, AL Swr Rev Cap Impt Wts Ser A
(Prerefunded @ 02/01/11) (FGIC Insd)........... 5.000 02/01/41 1,943,582
2,405 Marshall Cnty, AL Hlthcare Ser C............... 6.000 01/01/32 2,543,865
-------------
19,923,970
-------------
ALASKA 0.2%
1,000 Alaska St Intl Arpt Rev Ser B (AMBAC Insd)..... 5.750 10/01/17 1,152,230
-------------
ARIZONA 0.7%
1,425 Arizona Cap Fac Fin Corp Student Hsg Rev AZ St
Univ Proj...................................... 6.250 09/01/32 1,516,912
1,000 Arizona Hlth Fac Auth Hosp John C Lincoln Hlth
Network........................................ 6.375 12/01/37 1,061,500
1,750 Arizona Sch Fac Brd Ctf Part Ser A (MBIA
Insd).......................................... 5.250 09/01/17 1,933,102
-------------
4,511,514
-------------
ARKANSAS 0.7%
2,310 Arkansas St Dev Fin Auth Rev St Agy Fac
Donaghey Plaza Proj (FSA Insd)................. 5.000 06/01/34 2,376,389
1,565 Fort Smith, AR Wtr & Swr Rev Ser C (FSA Insd)
(f)............................................ 5.000 10/01/21 1,676,459
-------------
4,052,848
-------------
CALIFORNIA 14.3%
4,000 Anaheim, CA Pub Fin Auth Lease Rev Cap Apprec
Sub Pub Impts Proj C (FSA Insd)................ * 09/01/20 1,897,280
350 California Hlth Fac Fin Auth Rev Casa De Las
Ser A (MBIA Insd).............................. 5.250 08/01/17 379,634
2,500 California St (AMBAC Insd)..................... 5.000 04/01/21 2,645,100
5,500 California St (AMBAC Insd)..................... 5.125 10/01/27 5,734,135
1,250 California St Dept Wtr Res Pwr Ser A........... 6.000 05/01/15 1,463,350
4,000 California St Dept Wtr Res Pwr Ser A (AMBAC
Insd) (a)...................................... 5.375 05/01/18 4,436,800
3,705 California St Dept Wtr Res Pwr Ser A (MBIA
Insd).......................................... 5.375 05/01/21 4,061,273
2,000 California St Dept Wtr Res Pwr Ser A (MBIA
Insd).......................................... 5.375 05/01/22 2,185,520
5,295 California St Econ Rec Ser A................... 5.000 07/01/17 5,680,635
2,500 California St Pub Wks Brd Lease Rev Dept
Corrections Ser E Rfdg (XLCA Insd)............. 5.000 06/01/18 2,723,375
</Table>
8 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
CALIFORNIA (CONTINUED)
$1,000 California St Pub Wks Brd UCLA Replacement Hosp
Ser A (FSA Insd)............................... 5.375% 10/01/20 $ 1,097,880
5,000 California St Univ Rev Systemwide Ser A (AMBAC
Insd).......................................... 5.000 11/01/23 5,263,650
2,650 California Statewide Cmnty Dev Auth Ctf Part
(Acquired 04/12/02, Cost $2,650,000) (b)....... 7.250 11/01/29 2,772,536
5,000 Contra Costa, CA Home Mtg Fin Auth Home Mtg Rev
(Escrowed to Maturity) (MBIA Insd)............. * 09/01/17 2,735,750
1,000 Davis, CA Pub Fac Fin Auth Mace Ranch Area Ser
A.............................................. 6.600 09/01/25 1,052,920
850 Del Mar, CA Race Track Auth Rev Rfdg........... 6.000 08/15/06 875,134
18,000 Foothill/Eastern Corridor Agy CA Toll Rd Rev
Cap Apprec Rfdg (MBIA Insd).................... * 01/15/25 5,675,220
27,810 Foothill/Eastern Corridor Agy CA Toll Rd Rev
Cap Apprec Rfdg................................ * 01/15/33 5,185,174
6,000 Foothill/Eastern Corridor Agy CA Toll Rd Rev
Cap Apprec Sr Lien Ser A (Escrowed to
Maturity)...................................... * 01/01/18 3,428,100
2,240 Huntington Park, CA Redev Agy Rev Tax Alloc
Santa Fe Redev Rfdg............................ 6.200 10/01/27 2,336,947
2,635 Imperial Irr Dist CA Ctf Part Elec Sys Proj
(FSA Insd)..................................... 5.250 11/01/23 2,847,855
2,000 Los Angeles, CA Uni Sch Dist Ser A (MBIA
Insd).......................................... 5.375 07/01/18 2,237,820
4,400 Los Angeles, CA Uni Sch Dist Ser A (MBIA
Insd).......................................... 5.250 07/01/19 4,855,400
5,585 Sacramento, CA City Fin Auth Rev Comb Proj B
(MBIA Insd).................................... * 11/01/14 3,712,685
1,375 San Bernadino, CA Jt Pwrs Fin Auth Alloc Rev
Cent City Merged Proj A Rfdg (AMBAC Insd)
(f)............................................ 5.750 07/01/20 1,650,412
3,545 San Diego, CA Uni Sch Dist Election 1998 Ser
E-1 Rfdg (MBIA Insd)........................... 5.000 07/01/23 3,804,352
5,000 University CA Rev Gen Ser B (AMBAC Insd)....... 5.000 05/15/20 5,364,400
-------------
86,103,337
-------------
COLORADO 2.0%
1,000 Colorado Hlth Fac Auth Rev Catholic Hlth
Initiatives Ser A (Escrowed to Maturity)....... 5.500 03/01/32 1,050,690
1,125 Colorado Hlth Fac Auth Rev Hosp Portercare
Adventist Hlth................................. 6.500 11/15/31 1,236,645
2,200 La Plata Cnty, CO Sch Dist 9-R Durango (MBIA
Insd) (f)...................................... 5.250 11/01/21 2,382,886
6,365 Platte Riv Pwr Auth CO Pwr Rev Ser EE.......... 5.375 06/01/16 7,167,690
-------------
11,837,911
-------------
CONNECTICUT 5.5%
1,935 Bridgeport, CT Ser A (MBIA Insd) (f)........... 5.250 08/15/20 2,130,125
2,265 Bridgeport, CT Ser A (MBIA Insd) (f)........... 5.250 08/15/23 2,455,169
7,140 Connecticut St Hlth & Ed Fac Auth Rev Nursing
Home Proj AHF/Hartford (Prerefunded @
11/01/04)...................................... 7.125 11/01/24 7,284,871
</Table>
See Notes to Financial Statements 9
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
CONNECTICUT (CONTINUED)
$2,840 Connecticut St Spl Oblig Pkg Rev Bradley Intl
Arpt Ser A (AMT) (ACA Insd).................... 6.600% 07/01/24 $ 3,077,964
3,540 Mashantucket Western Pequot Tribe CT Spl Rev
Ser A, 144-A Private Placement (c)............. 6.400 09/01/11 3,786,526
3,460 Mashantucket Western Pequot Tribe CT Spl Rev
Ser A, 144-A Private Placement (Prerefunded @
09/01/07) (c).................................. 6.400 09/01/11 3,851,568
6,500 Mashantucket Western Pequot Tribe CT Spl Rev
Ser B, 144-A Private Placement (c)............. 5.750 09/01/18 6,845,345
3,500 Mashantucket Western Pequot Tribe CT Spl Rev
Ser B, 144-A Private Placement (c)............. 5.750 09/01/27 3,609,060
-------------
33,040,628
-------------
DISTRICT OF COLUMBIA 1.0%
1,000 District of Columbia Hosp Rev Medlantic
Hlthcare Group A Rfdg (Escrowed to Maturity)
(MBIA Insd).................................... 5.875 08/15/19 1,080,250
5,000 Metropolitan Washington DC Arpt Auth Sys Ser A
(AMT) (FGIC Insd).............................. 5.125 10/01/26 5,143,350
-------------
6,223,600
-------------
FLORIDA 10.0%
3,380 Brevard Cnty, FL Hlth Fac Hlth First Inc Proj
(MBIA Insd).................................... 5.125 04/01/31 3,480,758
2,550 Broward Cnty, FL Wtr & Swr Util Rfdg (MBIA
Insd).......................................... 5.000 10/01/20 2,746,630
3,040 Escambia Cnty, FL Hlth Fac Auth Rev (AMBAC
Insd).......................................... 5.950 07/01/20 3,122,870
1,000 Florida St Brd Ed Lottery Rev Ser A (FGIC
Insd).......................................... 5.750 07/01/11 1,151,140
3,000 Florida St Dept Environmental Protection
Preservation Rev Ser A (FGIC Insd)............. 5.750 07/01/10 3,444,930
3,880 Florida St Dept Trans Right of Way Ser A....... 5.250 07/01/21 4,306,916
1,895 Gulf Breeze, FL Rev Loc Govt (Variable Rate
Coupon) (FGIC Insd) (f)........................ 5.625 12/01/20 2,078,550
2,310 Hillsborough Cnty, FL Indl Dev Auth Andl Dev
Rev Hlth Fac Proj Univ Cmnty Hosp Ser A........ 5.500 08/15/14 2,412,148
1,000 Hillsborough Cnty, FL Util Jr Lien Rfdg (AMBAC
Insd).......................................... 5.000 08/01/06 1,052,750
1,000 Jea, FL Elec Sys Rev Ser 3 Ser A............... 5.500 10/01/41 1,067,250
265 Lakeland, FL Hosp Sys Rev Lakeland Regl Hlth
Sys............................................ 5.500 11/15/32 276,419
1,515 Miami Beach, FL Stormwtr Rev (FGIC Insd)....... 5.250 09/01/25 1,622,307
2,000 Miami-Dade Cnty, FL Aviation Rev Miami Intl
Arpt (AMT) (FGIC Insd)......................... 5.375 10/01/25 2,107,840
2,700 Miami-Dade Cnty, FL Aviation Rev Miami Intl
Arpt (AMT) (FGIC Insd)......................... 5.375 10/01/32 2,808,054
5,000 Miami-Dade Cnty, FL Aviation Ser A (AMT) (FSA
Insd).......................................... 5.125 10/01/35 5,093,300
</Table>
10 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
FLORIDA (CONTINUED)
$1,855 Miami-Dade Cnty, FL Hlth Fac Miami Childrens
Hosp Ser A Rfdg (AMBAC Insd)................... 5.000% 08/15/20 $ 1,958,342
3,750 Orange Cnty, FL Sch Brd Ctf Part Ser A (AMBAC
Insd).......................................... 5.250 08/01/14 4,220,550
4,320 Orange Cnty, FL Tourist Dev Tax Rev (AMBAC
Insd).......................................... 5.625 10/01/14 4,857,322
4,300 Orange Cnty, FL Tourist Dev Tax Rev (AMBAC
Insd).......................................... 5.500 10/01/31 4,674,100
1,000 Osceola Cnty, FL Trans Rev Osceola Pkwy Proj
Impt & Rfdg (MBIA Insd)........................ 5.000 04/01/21 1,075,800
2,140 Reedy Creek, FL Impt Dist FL Ser A Rfdg (AMBAC
Insd).......................................... 5.500 06/01/12 2,434,057
1,060 Tallahassee, FL Lease Rev FL St Univ Proj Ser A
(MBIA Insd) (f)................................ 5.500 08/01/18 1,188,631
2,780 Volusia Cnty, FL Gas Tax Rev (FSA Insd) (d).... 5.000 10/01/22 2,978,687
-------------
60,159,351
-------------
GEORGIA 3.7%
2,000 Atlanta, GA Arpt Passenger Fac Gen Sub Lien Ser
C (FSA Insd)................................... 5.000 01/01/33 2,064,140
2,645 Georgia St Ser D............................... 6.000 10/01/05 2,745,986
3,500 Georgia St Ser D............................... 6.000 10/01/06 3,765,755
1,400 Municipal Elec Auth GA Combustion Turbine Proj
Ser A (MBIA Insd).............................. 5.250 11/01/14 1,578,934
8,030 Municipal Elec Auth GA Combustion Turbine Proj
Ser A (MBIA Insd).............................. 5.250 11/01/18 8,945,581
1,000 Oconee Cnty, GA Indl Dev Auth Oiit Proj (XLCA
Insd).......................................... 5.250 07/01/23 1,067,730
2,000 Royston, GA Hosp Auth Hosp Ctf Rev Ty Cobb
Hlthcare Sys Inc Rfdg.......................... 6.500 07/01/27 1,994,600
-------------
22,162,726
-------------
HAWAII 0.3%
1,465 Honolulu, HI City & Cnty Ser D (AMT) (FGIC
Insd).......................................... 4.700 02/01/08 1,562,657
645 Honolulu, HI City & Cnty Wastewtr Sys Rev Cap
Apprec (FGIC Insd)............................. * 07/01/12 482,112
-------------
2,044,769
-------------
ILLINOIS 15.1%
3,400 Carol Stream, IL First Mtg Rev Windsor Pk Mnr
Proj (Prerefunded @ 12/01/07).................. 7.000 12/01/13 3,910,680
1,500 Champaign Cnty, IL Cmnty Unit Sch Dist No 116
Urbana Ser C (Prerefunded @ 01/01/10) (FGIC
Insd).......................................... * 01/01/16 897,720
1,300 Champaign Cnty, IL Cmnty Unit Sch Dist No 116
Urbana Ser C (Prerefunded @ 01/01/10) (FGIC
Insd).......................................... * 01/01/18 688,584
</Table>
See Notes to Financial Statements 11
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
ILLINOIS (CONTINUED)
$1,285 Chicago, IL Brd Ed (Prerefunded @ 12/01/10)
(FGIC Insd).................................... 6.000% 12/01/12 $ 1,503,578
1,400 Chicago, IL Brd Ed Ser A (MBIA Insd)........... 5.500 12/01/28 1,521,800
4,000 Chicago, IL Neighborhoods Alive 21 Pgm Ser A
(FGIC Insd).................................... 5.750 01/01/40 4,420,040
5,000 Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third
Lien Ser A Rfdg (AMT) (MBIA Insd).............. 5.375 01/01/32 5,173,900
2,500 Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third
Lien Ser C 2 Rfdg (AMT) (FSA Insd)............. 5.250 01/01/30 2,585,325
1,015 Chicago, IL O'Hare Intl Arpt Rev Second Lien
Passenger Fac Ser B (AMBAC Insd)............... 5.500 01/01/16 1,133,156
1,980 Chicago, IL Pk Dist Ser C (FGIC Insd).......... 5.500 01/01/19 2,219,976
2,565 Chicago, IL Proj Ser C Rfdg (FGIC Insd) (f).... 5.750 01/01/12 2,936,771
1,000 Cook Cnty, IL Cmnty Cons Sch Dist No 64 Park
Ridge (FSA Insd)............................... 5.500 12/01/14 1,162,820
1,000 Cook Cnty, IL Ser A (FGIC Insd)................ 5.500 11/15/31 1,082,670
7,765 Du Page Cnty, IL Forest Preserve Dist.......... * 11/01/17 4,403,143
5,000 Du Page Cnty, IL Trans Rev (FSA Insd).......... 5.750 01/01/15 5,708,700
4,000 Hodgkins, IL Tax Increment Ser A Rfdg.......... 7.625 12/01/13 4,288,080
2,860 Illinois Dev Fin Auth Rev Adventist Hlth Ser A
(MBIA Insd) (e) (f)............................ 5.500 11/15/05 2,960,043
2,725 Illinois Dev Fin Auth Rev Cmnty Rehab Providers
Fac Ser A...................................... 7.375 07/01/25 2,946,597
2,705 Illinois Dev Fin Auth Rev Loc Govt Pgm Aurora
East Sch (MBIA Insd)........................... * 12/01/15 1,694,980
1,565 Illinois Ed Fac Auth Rev DePaul Univ
(Prerefunded @ 10/01/10) (AMBAC Insd).......... 5.625 10/01/15 1,809,156
1,740 Illinois Ed Fac Auth Rev Lewis Univ............ 5.900 10/01/14 1,744,437
2,500 Illinois Fin Auth Rev Northwestern Mem Hosp Ser
A.............................................. 5.500 08/15/43 2,600,200
1,645 Illinois Hlth Fac Auth Rev Evangelical Hosp Ser
C Rfdg (FSA Insd).............................. 6.750 04/15/12 1,956,958
2,500 Illinois St First Ser (MBIA Insd).............. 5.500 12/01/09 2,827,000
1,500 Illinois St First Ser (FGIC Insd).............. 5.375 11/01/14 1,696,260
3,000 Illinois St First Ser (FSA Insd)............... 5.250 12/01/21 3,249,330
3,440 Kendall Kane & Will Cntys, IL Cmnty Sch Dist No
308 Ser B (FGIC Insd) (f)...................... 5.250 10/01/19 3,802,163
870 Metropolitan Pier & Expo Auth IL Dedicated St
Tax Rev Cap Apprec (Escrowed to Maturity) (FGIC
Insd).......................................... * 06/15/14 591,939
3,460 Metropolitan Pier & Expo Auth IL Dedicated St
Tax Rev Cap Apprec (Unrefunded Balance) (FGIC
Insd).......................................... * 06/15/14 2,338,649
2,675 Metropolitan Pier & Expo Auth IL Dedicated St
Tax Rev McCormick Pl Expn Ser A (MBIA Insd).... 5.250 06/15/42 2,794,626
</Table>
12 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
ILLINOIS (CONTINUED)
$1,510 Roselle, IL Multi-Family Hsg Rev Waterbury Apts
Ser A Rfdg (GNMA Collateralized)............... 7.000% 01/01/25 $ 1,544,775
2,500 Schaumburg, IL Ser B (FGIC Insd)............... 5.000 12/01/41 2,534,525
3,505 Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill
Cap Apprec (FGIC Insd)......................... * 01/01/14 2,404,745
2,010 Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill
Cap Apprec (FGIC Insd)......................... * 01/01/16 1,238,703
1,415 Will Cnty, IL Cmnty Sch Dist No 161 Summit Hill
Cap Apprec (FGIC Insd)......................... * 01/01/19 737,611
9,660 Will Cnty, IL Fst Presv Dist Ser B (FGIC
Insd).......................................... * 12/01/16 5,734,949
-------------
90,844,589
-------------
INDIANA 1.3%
1,000 Allen Cnty, IN Juvenile Justice Ctr First Mtg
(AMBAC Insd)................................... 5.500 01/01/18 1,122,060
1,000 Clark Pleasant, IN Cmnty Sch First Mtg (AMBAC
Insd).......................................... 5.500 07/15/13 1,136,810
1,580 Indiana Trans Fin Auth Toll Rd Lease Rev Rfdg
(AMBAC Insd)................................... 5.375 07/01/09 1,691,927
1,500 Petersburg, IN Pollutn Ctl Rev IN Pwr & Lt
(AMT) (e)...................................... 5.950 12/01/29 1,515,630
2,500 Vigo Cnty, IN Sch Bldg Corp First Mtg Impt &
Rfdg (FSA Insd)................................ 5.250 07/10/24 2,663,350
-------------
8,129,777
-------------
KANSAS 1.1%
3,000 Sedgwick Cnty, KS Uni Sch Dist No 259 Wichita
(MBIA Insd).................................... 6.000 09/01/09 3,446,280
1,395 Wichita, KS Pub Bldg Comm Rev Wichita St Univ
Proj Ser L Rfdg (AMBAC Insd) (f)............... 5.000 02/01/15 1,520,048
1,465 Wichita, KS Pub Bldg Comm Rev Wichita St Univ
Proj Ser L Rfdg (AMBAC Insd) (f)............... 5.000 02/01/16 1,587,562
-------------
6,553,890
-------------
KENTUCKY 2.2%
4,000 Elsmere, KY Indl Dev Rev Courtaulds Pkg Inc
Proj Rfdg (Prerefunded @ 04/01/05)............. 6.750 04/01/10 4,159,840
1,500 Kentucky St Ppty & Bldg Commn Proj No 69 Ser A
Rfdg (FSA Insd)................................ 5.500 08/01/11 1,718,520
3,500 Kentucky St Tpk Auth Econ Dev Revitalization
Proj Rfdg (FSA Insd)........................... 5.500 07/01/07 3,808,980
1,000 Kentucky St Tpk Auth Econ Dev Revitalization
Proj Rfdg (Prerefunded @ 01/01/11) (FSA
Insd).......................................... 5.625 07/01/14 1,145,950
2,350 Louisville & Jefferson, KY Swr Ser A (MBIA
Insd) (f)...................................... 5.500 05/15/15 2,675,334
-------------
13,508,624
-------------
</Table>
See Notes to Financial Statements 13
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
LOUISIANA 3.7%
$5,000 Ernest N Morial New Orleans LA Sr Sub Ser A
(AMBAC Insd)................................... 5.250% 07/15/21 $ 5,442,150
1,500 Louisiana Hsg Fin Agy Rev Azalea Estates Ser A
Rfdg (AMT) (GNMA Collateralized)............... 5.375 10/20/39 1,523,820
1,675 Louisiana Loc Govt Environmental Fac Pkg Fac
Corp Garage Proj Ser A (AMBAC Insd) (f)........ 5.200 10/01/19 1,841,847
2,580 Louisiana Loc Govt Environmental Rev Southeastn
LA Student Hsg A (MBIA Insd)................... 5.250 08/01/21 2,824,042
3,000 Louisiana St Ser A (FGIC Insd)................. 5.500 11/15/07 3,291,360
8,033 Louisiana St Univ & Agric & Mechanical College
Univ Rev Master Agreement (Acquired 11/30/98,
Cost $8,032,929) (b)........................... 5.750 10/30/18 7,629,435
-------------
22,552,654
-------------
MAINE 0.2%
1,000 Maine Vets Homes, ME Rev (Prerefunded @
10/01/05)...................................... 7.750 10/01/20 1,070,110
-------------
MARYLAND 1.3%
2,300 Baltimore, MD Cap Apprec Cons Pub Ser A Impt &
Rfdg (FGIC Insd)............................... * 10/15/06 2,129,869
1,845 Baltimore, MD Cap Apprec Ser A (Unrefunded
Balance) (FGIC Insd)........................... * 10/15/07 1,603,342
1,700 Maryland St Trans Auth Arpt Baltimore/WA Intl
Arpt B (AMT) (AMBAC Insd)...................... 5.125 03/01/24 1,779,577
2,365 Northeast, MD Waste Disp Auth Rfdg (AMT) (AMBAC
Insd).......................................... 5.500 04/01/16 2,603,132
-------------
8,115,920
-------------
MASSACHUSETTS 4.0%
1,775 Massachusetts Muni Whsl Elec Co Nuclear Proj 5
(MBIA Insd).................................... 5.250 07/01/13 1,990,396
1,745 Massachusetts St Cons Ln Ser B (Prerefunded @
05/01/09)...................................... 5.250 05/01/13 1,946,076
1,000 Massachusetts St Cons Ln Ser B (Prerefunded @
08/01/14) (AMBAC Insd)......................... 5.000 08/01/22 1,067,970
5,000 Massachusetts St Cons Ln Ser E (Prerefunded @
01/01/13) (FSA Insd)........................... 5.250 01/01/20 5,637,800
2,165 Massachusetts St Dev Fin Agy Proj Ser R-2 (MBIA
Insd).......................................... 5.125 02/01/34 2,232,548
785 Massachusetts St Dev Fin Agy Rev Boston
Architectural Ctr (ACA Insd)................... 6.100 09/01/18 841,481
1,000 Massachusetts St Dev Fin Agy Rev Boston
Architectural Ctr (ACA Insd)................... 6.250 09/01/28 1,050,950
1,500 Massachusetts St Fed Hwy Gnt Antic Nt Ser A.... 5.750 06/15/15 1,699,830
3,700 Massachusetts St Hlth & Ed Fac Auth Rev
(Variable Rate Coupon) (MBIA Insd)............. 5.000 07/01/13 3,782,621
</Table>
14 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
MASSACHUSETTS (CONTINUED)
$1,000 Massachusetts St Hlth & Ed Fac Auth Rev Part
Hlthcare Sys Ser C............................. 5.750% 07/01/32 $ 1,093,230
2,500 Massachusetts St Spl Oblig Dedicated Tax Rev
(FGIC Insd).................................... 5.000 01/01/34 2,574,925
-------------
23,917,827
-------------
MICHIGAN 3.6%
3,440 Detroit, MI Loc Dev Fin Auth Tax Increment Sr
Ser B (Acquired 09/08/97, Cost $3,440,000)
(b)............................................ 6.700 05/01/21 3,441,961
850 Detroit, MI Loc Dev Fin Auth Tax Increment Sub
Ser C (Acquired 09/08/97, Cost $850,000) (b)... 6.850 05/01/21 834,785
3,860 Detroit, MI Ser A (XLCA Insd) (f).............. 5.250 04/01/21 4,137,804
2,930 Detroit, MI Wtr Supply Sys Rev Sr Lien Ser C
Rfdg (MBIA Insd) (f)........................... 5.250 07/01/18 3,221,916
1,180 Hillsdale, MI Hosp Fin Auth Hosp Rev Hillsdale
Cmnty Hlth Ctr................................. 5.750 05/15/18 1,221,005
2,000 Michigan Muni Bd Auth Rev Clean Wtr Rev Fd..... 5.250 10/01/18 2,231,480
500 Michigan St Hosp Fin Auth Rev Hosp Genesys Regl
Med Ser A Rfdg (Escrowed to Maturity).......... 5.375 10/01/13 557,195
1,550 Michigan St Hsg Dev Rental Hsg Rev Ser A (AMT)
(MBIA Insd).................................... 5.300 10/01/37 1,582,798
1,500 Michigan St Strategic Fd Detroit Edison Co Proj
C Rfdg (AMT) (XLCA Insd)....................... 5.450 12/15/32 1,570,650
2,500 Michigan St Trunk Line Ser A (Prerefunded @
11/01/11)...................................... 5.500 11/01/15 2,866,925
-------------
21,666,519
-------------
MISSISSIPPI 0.5%
2,500 Mississippi Bus Fin Corp MS Pollutn Ctl Rev Sys
Energy Res Inc Proj............................ 5.875 04/01/22 2,508,750
480 Mississippi Home Corp Single Family Rev Mtg Ser
F (AMT) (GNMA Collateralized).................. 7.550 12/01/27 483,893
-------------
2,992,643
-------------
MISSOURI 2.7%
1,400 Ellisville, MO Indl Dev Auth Rev Gambrill
Gardens Proj Rfdg & Impt....................... 6.100 06/01/20 1,375,626
1,000 Ellisville, MO Indl Dev Auth Rev Gambrill
Gardens Proj Rfdg & Impt....................... 6.200 06/01/29 948,690
1,740 Good Shepherd Nursing Home Dist MO Nursing Home
Fac Rev (Prerefunded @ 08/15/05)............... 7.625 08/15/15 1,847,897
1,000 Kearney, MO (AMBAC Insd)....................... 5.500 03/01/16 1,116,980
1,415 Missouri St Hlth & Ed Fac Rev Univ MO Columbia
Arena Proj..................................... 5.000 11/01/18 1,537,341
3,085 Missouri St Hwys & Trans Commn Rd Rev Ser A.... 5.250 02/01/07 3,305,732
1,000 Missouri St Hwys & Trans Commn Rd Rev Ser A.... 5.125 02/01/17 1,088,300
</Table>
See Notes to Financial Statements 15
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
MISSOURI (CONTINUED)
$2,810 Perry Cnty, MO Nursing Home Rev Rfdg........... 5.900% 03/01/28 $ 2,509,892
2,505 Saint Louis, MO Arpt Rev Cap Impt Prog Ser A
(MBIA Insd) (f)................................ 5.375 07/01/20 2,761,788
-------------
16,492,246
-------------
NEVADA 1.7%
3,000 Clark Cnty, NV Arpt Rev Sub Lien Ser A-2 (FGIC
Insd).......................................... 5.000 07/01/36 3,056,490
3,000 Clark Cnty, NV Indl Dev Rev Southwest Gas Corp
Proj Ser A (AMT) (AMBAC Insd).................. 5.250 07/01/34 3,096,000
2,500 Reno, NV Cap Impt Rev (FGIC Insd).............. 5.125 06/01/26 2,603,975
1,500 Reno, NV Sr Lien Retrac Reno Trans Proj (AMBAC
Insd).......................................... 5.125 06/01/37 1,542,930
-------------
10,299,395
-------------
NEW HAMPSHIRE 1.3%
4,800 New Hampshire Higher Ed & Hlth Fac Auth Rev
Daniel Webster College Issue................... 6.300 07/01/29 4,685,136
2,000 New Hampshire Higher Ed & Hlth Fac Auth Rev
Riverwoods at Exeter Ser A..................... 6.500 03/01/23 1,989,180
1,000 New Hampshire Hlth & Ed Fac Auth Rev Derryfield
Sch............................................ 6.750 07/01/20 987,990
-------------
7,662,306
-------------
NEW JERSEY 10.5%
1,460 Eastern Camden Cnty, NJ Regl Sch Dist Rfdg
(FGIC Insd) (f)................................ * 03/01/05 1,451,211
1,465 Eastern Camden Cnty, NJ Regl Sch Dist Rfdg
(FGIC Insd) (f)................................ * 03/01/06 1,425,518
1,615 Eastern Camden Cnty, NJ Regl Sch Dist Rfdg
(FGIC Insd) (f)................................ * 03/01/07 1,526,724
1,555 Eastern Camden Cnty, NJ Regl Sch Dist Rfdg
(FGIC Insd) (f)................................ * 03/01/08 1,423,634
2,895 Essex Cnty, NJ Impt Auth Rev Cnty Gtd Proj
Consldtn Rfdg (MBIA Insd)...................... 5.125 10/01/20 3,160,732
1,500 New Jersey Econ Dev Auth Cigarette Tax......... 5.750 06/15/29 1,539,930
3,880 New Jersey Econ Dev Auth Mtr Veh Sur Rev Ser A
(MBIA Insd).................................... 5.000 07/01/22 4,141,939
25,000 New Jersey Econ Dev Auth St Contract Econ
Recovery (MBIA Insd) (e)....................... 5.900 03/15/21 30,338,250
2,825 New Jersey St Ed Fac Auth Higher Ed Cap Impt
Ser A (AMBAC Insd)............................. 5.250 09/01/19 3,127,529
3,500 New Jersey St Tpk Auth Tpk Rev Ser C (FSA
Insd).......................................... 6.500 01/01/16 4,318,265
1,000 New Jersey St Trans Corp Capital Grt Antic Nt
Ser B (AMBAC Insd)............................. 5.500 02/01/08 1,099,060
3,000 New Jersey St Trans Corp Ctf Fed Trans Admin
Grts Ser A (AMBAC Insd)........................ 5.500 09/15/13 3,441,510
</Table>
16 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
NEW JERSEY (CONTINUED)
$1,000 New Jersey St Trans Tr Fd Auth Trans Sys Ser
A.............................................. 5.750% 06/15/18 $ 1,184,160
1,840 New Jersey St Trans Tr Fd Auth Trans Sys Ser A
(FGIC Insd).................................... 5.250 06/15/19 2,040,045
3,000 Newark, NJ Hsg Auth Port Auth Newark Marine
Terminal (MBIA Insd)........................... 5.000 01/01/37 3,082,440
-------------
63,300,947
-------------
NEW MEXICO 0.3%
1,500 Jicarilla, NM Apache Nation Adj Ser A (Acquired
10/23/03, Cost $1,514,910) (b)................. 5.000 09/01/18 1,574,220
-------------
NEW YORK 12.8%
1,670 Long Island Pwr Auth, NY Elec Cap Apprec (FSA
Insd).......................................... * 06/01/18 951,232
3,000 Metropolitan Trans Auth NY Ser A Rfdg (FGIC
Insd).......................................... 5.250 11/15/31 3,188,460
2,500 Nassau Cnty, NY Interim Fin Auth Sales Tax
Secured Ser A (Prerefunded @ 11/15/10)......... 5.750 11/15/13 2,899,900
1,000 Nassau Cnty, NY Ser A Rfdg (FGIC Insd)......... 6.000 07/01/10 1,156,770
85 New York City Adj Sub Ser A-1 (e).............. 6.545 08/01/12 85,884
2,625 New York City Hlth & Hosp Corp Rev Hlth Sys Ser
A (AMBAC Insd)................................. 5.000 02/15/11 2,904,142
7,000 New York City Ser A............................ 6.250 08/01/08 7,557,410
2,000 New York City Ser H (FGIC Insd)................ 6.000 08/01/12 2,360,280
1,000 New York City Ser H............................ 5.750 03/15/13 1,132,340
2,500 New York City Ser I (MBIA Insd)................ 5.000 08/01/17 2,752,150
1,000 New York City Transitional Future Tax Secd Ser
C (AMBAC Insd)................................. 5.250 08/01/22 1,080,160
1,545 New York St Dorm Auth Lease Teachers College
(FSA Insd)..................................... 5.250 08/15/15 1,713,065
6,800 New York St Dorm Auth Rev City Univ Sys Cons
Ser A.......................................... 5.625 07/01/16 7,936,280
1,250 New York St Dorm Auth Rev Cons City Univ Sys A
(FSA Insd)..................................... 5.750 07/01/13 1,468,450
3,000 New York St Dorm Auth Rev Sch Dist Fin Pgm Ser
D (MBIA Insd).................................. 5.500 10/01/17 3,423,060
4,200 New York St Dorm Auth Rev Secd Hosp N General
Hosp Rfdg...................................... 5.750 02/15/19 4,709,502
2,190 New York St Hsg Fin Agy Econ Dev & Hsg Ser A
(f)............................................ 5.250 09/15/20 2,365,747
1,330 New York St Hsg Fin Agy Econ Dev & Hsg Ser A... 5.000 09/15/22 1,391,233
4,000 New York St Twy Auth Svc Cntrct Loc Hwy Brdg
(Prerefunded @ 04/01/11)....................... 5.250 04/01/16 4,525,840
3,000 New York, NY City Mun Wtr Fin Ser B............ 5.000 06/15/19 3,258,870
4,630 Plainedge, NY Un Free Sch Dist No. 2063
(Acquired 12/01/00, Cost $4,630,041) (b)....... 6.000 06/01/12 4,906,037
</Table>
See Notes to Financial Statements 17
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
NEW YORK (CONTINUED)
$5,000 Sales Tax Asset Receivable Corp Ser A (MBIA
Insd) (d)...................................... 5.000% 10/15/23 $ 5,333,250
3,000 Triborough Brdg & Tunl Auth Gen Purp Ser A..... 5.000 01/01/27 3,078,870
5,000 Triborough Brdg & Tunl Auth NY Gen Ser B
Rfdg........................................... 5.000 11/15/21 5,314,400
2,000 Triborough Brdg & Tunl Auth NY Ser E Rfdg (MBIA
Insd).......................................... 5.000 11/15/32 2,056,620
-------------
77,549,952
-------------
NORTH CAROLINA 4.6%
2,000 Johnston Cnty, NC (FGIC Insd).................. 5.900 03/01/19 2,310,120
7,015 North Carolina Eastern Muni Pwr Agy Pwr Sys Rev
Ser A Rfdg (MBIA Insd)......................... 5.500 01/01/05 7,059,475
8,300 North Carolina Muni Pwr Agy No 1 Catawba Elec
Rev Rfdg (MBIA Insd) (e)....................... 6.000 01/01/12 9,746,441
6,605 North Carolina Muni Pwr Agy Ser A (MBIA
Insd).......................................... 5.250 01/01/20 7,177,720
1,315 University NC Wilmington Rev (AMBAC Insd)
(f)............................................ 5.250 01/01/19 1,443,449
-------------
27,737,205
-------------
OHIO 5.9%
3,950 Cincinnati, OH City Sch Dist Sch Impt (FSA
Insd).......................................... 5.250 06/01/18 4,390,544
2,700 Cleveland-Cuyahoga Cnty, OH Dev Port Auth Rev
Cleveland Bond Fd Ser B (f).................... 5.375 05/15/18 2,738,394
1,000 Columbus, OH City Sch Dist Sch Fac Constr &
Impt (FSA Insd)................................ 5.250 12/01/21 1,105,080
1,000 Cuyahoga Cnty, OH Hosp Fac Rev Canton Inc
Proj........................................... 7.500 01/01/30 1,108,460
2,350 Franklin Cnty, OH Convention Fac Auth Tax &
Lease Rev Antic Bds Rfdg (AMBAC Insd).......... 5.250 12/01/17 2,622,553
1,200 Franklin Cnty, OH Convention Fac Auth Tax &
Lease Rev Antic Bds Rfdg (AMBAC Insd).......... 5.250 12/01/18 1,334,724
4,800 Franklin Cnty, OH Hosp Rev Holy Cross Hlth Sys
Ser B Rfdg (MBIA Insd)......................... 5.250 06/01/10 4,908,336
2,000 Lebanon, OH City Sch Dist (FSA Insd)........... 5.500 12/01/16 2,258,500
1,000 Lorain Cnty, OH Hosp Rev Catholic Hlthcare..... 5.375 10/01/30 1,032,490
2,000 Lorain, OH City Sch Dist Classroom Fac Impt
(MBIA Insd).................................... 5.250 12/01/20 2,198,140
1,000 Mahoning Cnty, OH Hosp Fac Forum Hlth Oblig
Group Ser A.................................... 6.000 11/15/32 1,059,030
1,520 Miami Univ OH Gen Rcpts Rfdg (AMBAC Insd)...... 5.000 12/01/21 1,630,626
1,580 Montgomery Cnty, OH Hosp Rev Grandview Hosp &
Med Ctr Rfdg (Escrowed to Maturity)............ 5.375 12/01/05 1,639,645
2,270 Montgomery Cnty, OH Hosp Rev Kettering Med Ctr
Impt & Rfdg (MBIA Insd)........................ 6.250 04/01/20 2,813,347
1,000 Ohio St Air Quality Dev Auth Rev JMG Fdg Ltd
Part Proj Rfdg (AMT) (AMBAC Insd).............. 6.375 04/01/29 1,023,300
</Table>
18 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
OHIO (CONTINUED)
$2,500 Ohio St Bldg Auth St Fac Adult Correction Ser A
Rfdg (FSA Insd)................................ 5.500% 10/01/12 $ 2,844,450
1,000 Ohio St Higher Ed Cap Fac Ser II A............. 5.250 12/01/05 1,036,740
-------------
35,744,359
-------------
OKLAHOMA 0.9%
1,240 Kay Cnty, OK Home Fin Auth Rev Single Family
Mtg Ser A Rfdg (Escrowed to Maturity) (AMBAC
Insd).......................................... 7.000 11/01/11 1,519,744
1,520 Oklahoma Hsg Fin Agy Single Family Rev Mtg
Class B (AMT) (GNMA Collateralized)............ 7.997 08/01/18 1,563,472
2,305 Oklahoma St Cap Impt Auth St (MBIA Insd)....... 5.000 06/01/06 2,416,839
-------------
5,500,055
-------------
OREGON 2.1%
4,000 Oregon Hlth Sciences Univ Insd Ser A (MBIA
Insd).......................................... 5.250 07/01/22 4,323,680
1,500 Oregon St Dept Admin Ser C Rfdg (MBIA Insd).... 5.250 11/01/17 1,669,860
1,250 Portland, OR Cmnty College Dist Ser B.......... 5.250 06/01/12 1,403,313
1,500 Washington Multnomah & Yamhill Cntys, OR Sch
Dist No 11 (MBIA Insd)......................... 5.000 06/01/13 1,654,335
3,195 Yamhill Cnty, OR Sch Dist No 029J Newberg (MBIA
Insd) (f)...................................... 5.250 06/15/18 3,551,882
-------------
12,603,070
-------------
PENNSYLVANIA 5.9%
2,500 Allegheny Cnty, PA San Auth Swr (MBIA Insd).... 5.500 12/01/30 2,726,100
3,850 Greater Latrobe, PA Sch Auth (FGIC Insd) (f)... 5.250 04/01/16 4,294,945
3,000 Harrisburg, PA Auth Res Gtd Sub Ser D-2
(Variable Rate Coupon) (FSA Insd).............. 5.000 12/01/33 3,291,330
210 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
Bible Fellowship Proj A Rfdg................... 5.000 12/15/05 210,130
275 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
Bible Fellowship Proj A Rfdg (f)............... 5.100 12/15/06 276,790
295 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
Bible Fellowship Proj A Rfdg (f)............... 5.250 12/15/07 298,744
210 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
Bible Fellowship Proj A Rfdg................... 5.300 12/15/08 212,818
320 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
Bible Fellowship Proj A Rfdg (f)............... 5.300 12/15/09 320,150
240 Lehigh Cnty, PA Gen Purp Auth Rev First Mtg
Bible Fellowship Proj A Rfdg................... 5.400 12/15/10 238,824
2,700 Pennsylvania Econ Dev Fin Auth Res Recovery Rev
Colver Proj Ser D (AMT)........................ 7.150 12/01/18 2,764,854
</Table>
See Notes to Financial Statements 19
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
PENNSYLVANIA (CONTINUED)
$1,000 Pennsylvania St Tpk Commn Rev Ser T Rfdg (FGIC
Insd).......................................... 5.500% 12/01/11 $ 1,151,860
1,000 Philadelphia, PA Auth Indl Dev Philadelphia
Arpt Sys Proj Ser A (AMT) (FGIC Insd).......... 5.125 07/01/19 1,059,740
2,600 Philadelphia, PA Auth Indl Ser B (FSA Insd).... 5.500 10/01/16 2,939,300
3,200 Philadelphia, PA Gas Wks Rev 1998 Gen Ordinance
4th Ser (FSA Insd)............................. 5.250 08/01/19 3,494,048
4,305 Philadelphia, PA Redev Auth Rev Neighborhood
Transformation Ser A (FGIC Insd)............... 5.250 04/15/11 4,850,917
1,500 Philadelphia, PA Sch Dist Ser A (Prerefunded @
02/01/11) (FSA Insd)........................... 5.750 02/01/12 1,732,500
5,205 Pittsburgh, PA Ser A (AMBAC Insd).............. 5.500 09/01/17 5,721,336
-------------
35,584,386
-------------
RHODE ISLAND 0.5%
2,495 Rhode Island St Hlth & Ed Higher Ed Johnson &
Wales Rfdg (XLCA Insd)......................... 5.375 04/01/18 2,756,002
-------------
SOUTH CAROLINA 0.7%
2,000 Rock Hill, SC Util Sys Rev Comb Ser A Impt &
Rfdg (FSA Insd)................................ 5.375 01/01/18 2,218,660
475 Rock Hill, SC Util Sys Rev Comb Ser C Rfdg (FSA
Insd).......................................... 5.125 01/01/13 524,742
1,500 South Carolina Jobs Econ Dev Auth Indl Rev Elec
& Gas Co Proj Ser A (AMBAC Insd)............... 5.200 11/01/27 1,578,675
-------------
4,322,077
-------------
SOUTH DAKOTA 0.3%
1,905 Minnehaha Cnty, SD Ctf Ltd Tax (FSA Insd) (d)
(f)............................................ 5.000 12/01/19 2,058,695
-------------
TENNESSEE 1.6%
4,000 Johnson City, TN Hlth & Ed Fac Brd Hosp Rev
First Mtg Mtn St Hlth Ser A Rfdg (MBIA Insd)... 7.500 07/01/25 5,046,560
2,500 Memphis, TN (Prerefunded @ 10/01/06)........... 5.250 10/01/14 2,680,175
</Table>
20 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
TENNESSEE (CONTINUED)
$1,000 Metropolitan Nashville Arpt Auth TN Impt Ser A
Rfdg (FGIC Insd)............................... 6.600% 07/01/14 $ 1,195,160
990 Tennessee Hsg Dev Agy Home Ownership Pgm 2-A
(AMT).......................................... 5.700 07/01/31 1,027,689
-------------
9,949,584
-------------
TEXAS 10.0%
1,000 Brazos Cnty, TX Hlth Fac Dev Oblig Grp......... 5.375 01/01/32 1,015,840
1,350 Cameron Cnty, TX Ctf Oblig (AMBAC Insd) (f).... 5.750 02/15/14 1,521,828
2,500 Coastal Bend Hlth Fac Dev, TX Ser C (Inverse
Fltg) (Escrowed to Maturity) (AMBAC Insd)...... 8.138 11/15/13 3,411,275
2,420 Dallas Cnty, TX Cmnty College Dist Rev Fin Sys
(AMBAC Insd) (f)............................... 5.375 02/15/16 2,663,839
2,000 Fort Worth, TX Wtr & Swr Rev Impt Rfdg......... 5.500 02/15/05 2,021,940
1,745 Harris Cnty, TX Perm Impt & Rfdg............... 5.000 10/01/11 1,870,483
3,345 Houston, TX Hotel Occupancy Tax Convtn &
Entertnmnt Ser B (AMBAC Insd).................. 5.750 09/01/14 3,848,423
6,790 Houston, TX Indpt Sch Dist Pub Fac Corp Lease
Rev Cap Apprec West Side Ser B (AMBAC Insd)
(f)............................................ * 09/15/14 4,529,813
130 Houston, TX Pub Impt Rfdg (FSA Insd)........... 5.750 03/01/15 148,227
1,370 Houston, TX Pub Impt Rfdg (Prerefunded
09/01/10) (FSA Insd)........................... 5.750 03/01/15 1,566,253
10,000 Houston, TX Util Sys Rev First Lien Ser A Rfdg
(FSA Insd)..................................... 5.250 05/15/21 10,937,800
4,000 Houston, TX Util Sys Rev First Lien Ser A Rfdg
(FGIC Insd).................................... 5.250 05/15/23 4,325,760
2,500 Houston, TX Wtr & Swr Sys Rev Jr Lien Ser B
Rfdg (Escrowed to Maturity) (FGIC Insd)........ 6.250 12/01/05 2,618,950
1,250 Matagorda Cnty, TX Navig Dist No 1 Rev Coll
Centerpoint Energy Proj Rfdg (Variable Rate
Coupon)........................................ 5.600 03/01/27 1,289,200
1,000 Mesquite, TX Hlth Fac Dev Christian Care
Retirement Fac Ser A........................... 7.625 02/15/28 1,052,370
1,400 Metropolitan Hlth Fac Dev Corp TX Wilson N
Jones Mem Hosp Proj............................ 7.250 01/01/31 1,353,394
50 North Central, TX Hlth Fac Dev Hosp Baylor Hlth
Care Sys Proj A................................ 5.125 05/15/29 50,818
4,000 North Central, TX Hlth Fac Dev Hosp Childrens
Med Ctr Dallas (AMBAC Insd).................... 5.250 08/15/32 4,177,200
3,994 Region One Ed Svc Ctr Sub Tech Fac Proj
(Acquired 12/30/97, Cost $3,993,700) (b)....... 6.590 12/15/17 4,061,793
4,000 San Antonio, TX Elec & Gas Rev Sys Rfdg........ 5.375 02/01/18 4,466,080
1,123 Texas Gen Svc Comm Part Int (Acquired 03/16/95,
Cost $1,222,054) (b)........................... 7.250 08/01/11 1,140,726
</Table>
See Notes to Financial Statements 21
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
TEXAS (CONTINUED)
$ 75 Texas Muni Pwr Agy Rev (Escrowed to Maturity)
(MBIA Insd).................................... * 09/01/15 $ 48,154
3,925 Texas Muni Pwr Agy Rev (Unrefunded Balance)
(MBIA Insd).................................... * 09/01/15 2,496,104
-------------
60,616,270
-------------
VIRGINIA 2.2%
1,320 Fairfax Cnty, VA Ctf Part...................... 5.300% 04/15/23 1,417,654
1,500 Henrico Cnty, VA Indl Dev Auth Pub Fac Lease
Rev Henrico Cnty Regl Jail Proj (Prerefunded @
08/01/05)...................................... 6.500 08/01/10 1,582,710
1,500 Henrico Cnty, VA Indl Dev Auth Pub Fac Lease
Rev Henrico Cnty Regl Jail Proj (Prerefunded @
08/01/05)...................................... 7.125 08/01/21 1,589,715
1,630 Richmond, VA (FSA Insd)........................ 5.125 01/15/08 1,776,814
1,340 Richmond, VA (FSA Insd)........................ 5.500 01/15/10 1,515,620
5,000 Virginia St Pub Sch Auth Sch Fin 1997
Resolution Ser C............................... 5.000 08/01/20 5,383,200
-------------
13,265,713
-------------
WASHINGTON 5.5%
5,000 Bellevue, WA Convention Ctr Auth Spl Oblig Rev
Rfdg (MBIA Insd)............................... * 02/01/24 1,921,050
3,230 Clark Cnty, WA Pub Util Dist No. 001 Gen Sys
Rev Rfdg (FSA Insd) (f)........................ 5.500 01/01/07 3,465,112
3,000 Clark Cnty, WA Pub Util Dist No. 001 Gen Sys
Rev Rfdg (FSA Insd)............................ 5.625 01/01/12 3,366,150
5,000 Cowlitz Cnty, WA Spl Swr Rev CSOB Wastewtr
Treatment Rfdg (FGIC Insd)..................... 5.500 11/01/19 5,843,150
5,000 Energy Northwest WA Elec Rev Proj No 3 Ser A
Rfdg........................................... 5.500 07/01/17 5,589,400
3,000 Energy Northwest WA Elec Rev Proj No 3 Ser A
Rfdg (FSA Insd)................................ 5.500 07/01/18 3,372,210
5,000 King Cnty, WA Ser B Rfdg (MBIA Insd)........... 5.250 01/01/34 5,233,000
1,000 Port Seattle, WA Rev Ser B (AMT) (MBIA Insd)... 5.625 02/01/24 1,085,740
1,345 Tacoma, WA Elec Sys Rev Ser A Rfdg (FSA
Insd).......................................... 5.750 01/01/15 1,532,103
1,750 Washington St Pub Pwr Supply Sys Nuclear Proj
No 1 Rev (MBIA Insd)........................... 5.750 07/01/12 1,885,888
-------------
33,293,803
-------------
</Table>
22 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
<Table>
<Caption>
PAR
AMOUNT
(000) DESCRIPTION COUPON MATURITY VALUE
- --------------------------------------------------------------------------------------------
WEST VIRGINIA 1.1%
$6,550 Harrison Cnty, WV Cnty Cmnty Solid Waste Disp
Rev Potomac Edison Co Ser A (AMT) (MBIA Insd)
(f)............................................ 6.875% 04/15/22 $ 6,575,611
-------------
WISCONSIN 0.9%
5,000 Wisconsin St Hlth & Ed Fac Auth Mercy Hlth Sys
Corp (AMBAC Insd).............................. 5.500 08/15/25 5,387,100
-------------
GUAM 0.9%
5,000 Guam Pwr Auth Rev Ser A (AMBAC Insd)........... 5.250 10/01/34 5,285,800
-------------
PUERTO RICO 1.0%
2,000 Puerto Rico Muni Fin Agy Ser A (FSA Insd)...... 5.250 08/01/20 2,228,340
3,500 Puerto Rico Pub Bldgs Auth Rev Govt Facs Ser I
(Comwth Gtd)................................... 5.250 07/01/33 3,667,405
-------------
5,895,745
-------------
TOTAL LONG-TERM INVESTMENTS 148.1%
(Cost $832,047,426)....................................................... 894,019,978
SHORT-TERM INVESTMENTS 1.1%
(Cost $6,400,000)......................................................... 6,400,000
-------------
TOTAL INVESTMENTS 149.2%
(Cost $838,447,426)....................................................... 900,419,978
OTHER ASSETS IN EXCESS OF LIABILITIES 0.5%................................. 3,329,717
PREFERRED SHARES (INCLUDING ACCRUED DISTRIBUTIONS) (49.7%)................. (300,116,361)
-------------
NET ASSETS APPLICABLE TO COMMON SHARES 100.0%.............................. $ 603,633,334
=============
</Table>
Percentages are calculated as a percentage of net assets applicable to common
shares.
* Zero coupon bond
(a) All or a portion of these securities have been physically segregated in
connection with open futures contracts.
(b) These securities are restricted and may be resold only in transactions
exempt from registration which are normally those transactions with
qualified institutional buyers. Restricted Securities comprise 4.4% of net
assets applicable to common shares.
(c) 144A securities are those which are exempt from registration under Rule 144A
of the Securities Act of 1933, as amended. These securities may only be
resold in transactions exempt from registration which are normally those
transactions with qualified institutional buyers.
(d) Securities purchased on a when-issued or delayed delivery basis.
(e) Security converts to a fixed coupon rate at a predetermined date.
(f) The Trust owns 100% of the bond issuance.
ACA--American Capital Access
See Notes to Financial Statements 23
VAN KAMPEN MUNICIPAL TRUST
PORTFOLIO OF INVESTMENTS -- OCTOBER 31, 2004 continued
AMBAC--AMBAC Indemnity Corp.
AMT--Alternative Minimum Tax
Comwth Gtd--Commonwealth of Puerto Rico
FGIC--Financial Guaranty Insurance Co.
FSA--Financial Security Assurance Inc.
GNMA--Government National Mortgage Association
MBIA--Municipal Bond Investors Assurance Corp.
XLCA--XL Capital Assurance Inc.
24 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
FINANCIAL STATEMENTS
Statement of Assets and Liabilities
October 31, 2004
<Table>
ASSETS:
Total Investments (Cost $838,447,426)....................... $900,419,978
Cash........................................................ 31,897
Receivables:
Interest.................................................. 11,989,459
Investments Sold.......................................... 2,839,753
Other....................................................... 15,611
------------
Total Assets............................................ 915,296,698
------------
LIABILITIES:
Payables:
Investments Purchased..................................... 10,326,321
Investment Advisory Fee................................... 457,720
Income Distributions--Common Shares....................... 138,245
Other Affiliates.......................................... 34,355
Variation Margin on Futures............................... 5,438
Trustees' Deferred Compensation and Retirement Plans........ 369,938
Accrued Expenses............................................ 214,986
------------
Total Liabilities....................................... 11,547,003
Preferred Shares (including accrued distributions).......... 300,116,361
------------
NET ASSETS APPLICABLE TO COMMON SHARES...................... $603,633,334
============
NET ASSET VALUE PER COMMON SHARE ($603,633,334 divided by
36,365,393 shares outstanding)............................ $ 16.60
============
NET ASSETS CONSIST OF:
Common Shares ($.01 par value with an unlimited number of
shares authorized, 36,365,393 shares issued and
outstanding).............................................. $ 363,654
Paid in Surplus............................................. 538,413,497
Net Unrealized Appreciation................................. 61,956,652
Accumulated Undistributed Net Investment Income............. 3,813,714
Accumulated Net Realized Loss............................... (914,183)
------------
NET ASSETS APPLICABLE TO COMMON SHARES...................... $603,633,334
============
PREFERRED SHARES ($.01 par value, authorized 100,000,000
shares, 12,000 issued with liquidation preference of
$25,000 per share)........................................ $300,000,000
============
NET ASSETS INCLUDING PREFERRED SHARES....................... $903,633,334
============
</Table>
See Notes to Financial Statements 25
VAN KAMPEN MUNICIPAL TRUST
FINANCIAL STATEMENTS continued
Statement of Operations
For the Year Ended October 31, 2004
<Table>
INVESTMENT INCOME:
Interest.................................................... $44,193,797
-----------
EXPENSES:
Investment Advisory Fee..................................... 5,364,429
Preferred Share Maintenance................................. 801,595
Administrative Fee.......................................... 261,204
Trustees' Fees and Related Expenses......................... 152,106
Legal....................................................... 81,836
Custody..................................................... 50,288
Other....................................................... 387,907
-----------
Total Expenses.......................................... 7,099,365
Less Credits Earned on Cash Balances.................... 508
-----------
Net Expenses............................................ 7,098,857
-----------
NET INVESTMENT INCOME....................................... $37,094,940
===========
REALIZED AND UNREALIZED GAIN/LOSS:
Realized Gain/Loss:
Investments............................................... $ (748,208)
Futures................................................... (440,822)
-----------
Net Realized Loss........................................... (1,189,030)
-----------
Unrealized Appreciation/Depreciation:
Beginning of the Period................................... 46,947,631
-----------
End of the Period:
Investments............................................. 61,972,552
Futures................................................. (15,900)
-----------
61,956,652
-----------
Net Unrealized Appreciation During the Period............... 15,009,021
-----------
NET REALIZED AND UNREALIZED GAIN............................ $13,819,991
===========
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS..................... $(3,258,016)
===========
NET INCREASE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM
OPERATIONS................................................ $47,656,915
===========
</Table>
26 See Notes to Financial Statements
VAN KAMPEN MUNICIPAL TRUST
FINANCIAL STATEMENTS continued
Statements of Changes in Net Assets
<Table>
<Caption>
FOR THE FOR THE
YEAR ENDED YEAR ENDED
OCTOBER 31, 2004 OCTOBER 31, 2003
------------------------------------
FROM INVESTMENT ACTIVITIES:
Operations:
Net Investment Income................................... $ 37,094,940 $ 37,242,943
Net Realized Gain/Loss.................................. (1,189,030) 2,809,023
Net Unrealized Appreciation During the Period........... 15,009,021 1,757,060
Distributions to Preferred Shareholders:
Net Investment Income................................. (3,180,653) (3,055,413)
Net Realized Gain..................................... (77,363) -0-
------------ ------------
Change in Net Assets Applicable to Common Shares from
Operations............................................ 47,656,915 38,753,613
Distributions to Common Shareholders:
Net Investment Income................................. (34,036,953) (34,036,119)
Net Realized Gain..................................... (868,390) -0-
------------ ------------
NET CHANGE IN NET ASSETS APPLICABLE TO COMMON SHARES
FROM INVESTMENT ACTIVITIES............................ 12,751,572 4,717,494
NET ASSETS APPLICABLE TO COMMON SHARES:
Beginning of the Period................................. 590,881,762 586,164,268
------------ ------------
End of the Period (Including accumulated undistributed
net investment income of $3,813,714 and $3,974,030,
respectively)......................................... $603,633,334 $590,881,762
============ ============
</Table>
See Notes to Financial Statements 27
VAN KAMPEN MUNICIPAL TRUST
FINANCIAL HIGHLIGHTS
THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE
TRUST OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
<Table>
<Caption>
------------------------------
2004 2003 2002 (a)
------------------------------
NET ASSET VALUE, BEGINNING OF THE PERIOD.................... $ 16.25 $ 16.12 $ 16.07
------- ------- -------
Net Investment Income..................................... 1.03 1.02 1.06
Net Realized and Unrealized Gain/Loss..................... .37 .13 .01
Common Share Equivalent of Distributions Paid to Preferred
Shareholders:
Net Investment Income................................... (.09) (.08) (.11)
Net Realized Gain....................................... -0-(f) -0- -0-
------- ------- -------
Total from Investment Operations............................ 1.31 1.07 .96
Distributions Paid to Common Shareholders:
Net Investment Income................................... (.94) (.94) (.91)
Net Realized Gain....................................... (.02) -0- -0-
------- ------- -------
NET ASSET VALUE, END OF THE PERIOD.......................... $ 16.60 $ 16.25 $ 16.12
======= ======= =======
Common Share Market Price at End of the Period.............. $ 14.90 $ 14.57 $ 14.30
Total Return (b)............................................ 9.15% 8.60% 10.49%
Net Assets Applicable to Common Shares at End of the Period
(In millions)............................................. $ 603.6 $ 590.9 $ 586.2
Ratio of Expenses to Average Net Assets Applicable to Common
Shares (c)................................................ 1.19% 1.23% 1.35%
Ratio of Net Investment Income to Average Net Assets
Applicable to Common Shares (c)........................... 6.24% 6.28% 6.70%
Portfolio Turnover.......................................... 19% 24% 38%
SUPPLEMENTAL RATIOS:
Ratio of Expenses to Average Net Assets Including Preferred
Shares (c)................................................ .79% .81% .89%
Ratio of Net Investment Income to Average Net Assets
Applicable to Common Shares (d)........................... 5.70% 5.77% 5.98%
SENIOR SECURITIES:
Total Preferred Shares Outstanding.......................... 12,000 12,000 12,000
Asset Coverage Per Preferred Share (e)...................... $75,312 $74,245 $73,861
Involuntary Liquidating Preference Per Preferred Share...... $25,000 $25,000 $25,000
Average Market Value Per Preferred Share.................... $25,000 $25,000 $25,000
</Table>
* Non-Annualized
(a)As required, effective November 1, 2001, the Trust has adopted the provisions
of the AICPA Audit and Accounting Guide for Investment Companies and began
accreting market discount on fixed income securities. The effect of this
change for the year ended October 31, 2002 was to increase net investment
income per share by $.01, decrease net realized and unrealized gains and
losses per share by $.01 and increase the ratio of net investment income to
average net assets applicable to common shares from 6.69% to 6.70%. Per
share, ratios and supplemental data for periods prior to October 31, 2002
have not been restated to reflect this change in presentation.
(b)Total return assumes an investment at the common share market price at the
beginning of the period indicated, reinvestment of all distributions for the
period in accordance with the Trust's dividend reinvestment plan, and sale of
all shares at the closing common share market price at the end of the period
indicated.
(c)Ratios do not reflect the effect of dividend payments to preferred
shareholders.
(d)Ratios reflect the effect of dividend payments to preferred shareholders.
(e)Calculated by subtracting the Trust's total liabilities (not including the
preferred shares) from the Trust's total assets and dividing this by the
number of preferred shares outstanding.
(f)Amount is less than $0.01 per share.
28
<Table>
<Caption>
TWO
MONTHS
YEAR ENDED OCTOBER 31, ENDED YEAR ENDED AUGUST 31,
- --------------------------------- OCTOBER 31, -----------------------------------------
2001 2000 1999 1998 1998 1997 1996 1995
- -------------------------------------------------------------------------------------------
$ 14.91 $ 14.60 $ 17.39 $ 17.32 $ 16.60 $ 15.84 $ 15.73 $ 15.56
------- ------- -------- -------- -------- -------- -------- --------
1.13 1.17 1.20 .21 1.26 1.28 1.30 1.31
1.12 .42 (2.30) .08 .72 .73 .10 .26
(.27) (.34) (.24) (.02) (.30) (.29) (.30) (.32)
-0- -0- (.06) (.04) -0- -0- -0- -0-
------- ------- -------- -------- -------- -------- -------- --------
1.98 1.25 (1.40) .23 1.68 1.72 1.10 1.25
(.82) (.94) (.96) (.16) (.96) (.96) (.99) (1.08)
-0- -0- (.43) -0- -0- -0- -0- -0-
------- ------- -------- -------- -------- -------- -------- --------
$ 16.07 $ 14.91 $ 14.60 $ 17.39 $ 17.32 $ 16.60 $ 15.84 $ 15.73
======= ======= ======== ======== ======== ======== ======== ========
$ 13.79 $12.625 $13.1875 $16.8125 $16.1875 $ 15.75 $ 14.50 $ 14.25
15.97% 2.80% -14.47% 4.84%* 9.06% 15.87% 8.98% 2.39%
$ 584.4 $ 542.1 $ 530.9 $ 630.6 $ 628.2 $ 601.9 $ 574.6 $ 570.7
1.55% 1.67% 1.60% 1.57% 1.57% 1.61% 1.61% 1.65%
7.26% 8.07% 7.43% 7.20% 7.42% 7.86% 8.08% 8.58%
28% 39% 80% 6%* 94% 54% 36% 49%
1.01% 1.07% 1.06% 1.07% 1.06% 1.07% 1.06% 1.07%
5.51% 5.71% 5.95% 6.48% 5.66% 6.04% 6.20% 6.48%
12,000 12,000 12,000 6,000 6,000 6,000 6,000 6,000
$73,700 $70,177 $ 69,241 $155,104 $154,696 $150,322 $145,764 $145,113
$25,000 $25,000 $ 25,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000
$25,000 $25,000 $ 25,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000 $ 50,000
</Table>
See Notes to Financial Statements 29
VAN KAMPEN MUNICIPAL TRUST
NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004
1. SIGNIFICANT ACCOUNTING POLICIES
Van Kampen Municipal Trust (the "Trust") is registered as a diversified,
closed-end management investment company under the Investment Company Act of
1940, as amended. The Trust's investment objective is to seek to provide a high
level of current income exempt from federal income tax, consistent with
preservation of capital. The Trust will invest in a portfolio consisting
substantially of municipal obligations rated investment grade at the time of
investment, but may invest up to 20% of its assets in unrated securities which
are believed to be of comparable quality to those rated investment grade. The
Trust commenced investment operations on September 27, 1991. Effective November
30, 2003, the Trust's investment adviser, Van Kampen Investment Advisory Corp.
merged into its affiliate, Van Kampen Asset Management (the "Adviser").
The following is a summary of significant accounting policies consistently
followed by the Trust in the preparation of its financial statements. The
preparation of financial statements in conformity with accounting principles
generally accepted in the United States of America requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of
the financial statements and the reported amounts of revenues and expenses
during the reporting period. Actual results could differ from those estimates.
A. SECURITY VALUATION Municipal bonds are valued by independent pricing services
or dealers using the mean of the bid and asked prices or, in the absence of
market quotations, at fair value based upon yield data relating to municipal
bonds with similar characteristics and general market conditions. Securities
which are not valued by independent pricing services or dealers are valued at
fair value using procedures established in good faith by the Board of Trustees.
Short-term securities with remaining maturities of 60 days or less are valued at
amortized cost, which approximates market value.
B. SECURITY TRANSACTIONS Security transactions are recorded on a trade date
basis. Realized gains and losses are determined on an identified cost basis. The
Trust may purchase and sell securities on a "when-issued" or "delayed delivery"
basis, with settlement to occur at a later date. The value of the security so
purchased is subject to market fluctuations during this period. The Trust will
segregate assets with the custodian having an aggregate value at least equal to
the amount of the when-issued or delayed delivery purchase commitments until
payment is made. At October 31, 2004, the Trust had $10,326,321 of when-issued
and delayed delivery purchase commitments.
C. INVESTMENT INCOME Interest income is recorded on an accrual basis. Bond
premium is amortized and discount is accreted over the expected life of each
applicable security.
D. FEDERAL INCOME TAXES It is the Trust's policy to comply with the requirements
of the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no provision for federal income taxes is required.
The Trust intends to utilize provisions of the federal income tax laws which
allow it to carry a realized capital loss forward for eight years following the
year of the loss and offset such losses against any future realized capital
gains. At October 31, 2004, the Trust had an
30
VAN KAMPEN MUNICIPAL TRUST
NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued
accumulated capital loss carryforward for tax purposes of $930,080, which will
expire on October 31, 2012.
At October 31, 2004, the cost and related gross unrealized appreciation and
depreciation are as follows:
<Table>
Cost of investments for tax purposes........................ $837,846,231
============
Gross tax unrealized appreciation........................... $ 63,518,261
Gross tax unrealized depreciation........................... (944,514)
------------
Net tax unrealized appreciation on investments.............. $ 62,573,747
============
</Table>
E. DISTRIBUTION OF INCOME AND GAINS The Trust declares and pays monthly
dividends from net investment income to common shareholders. Net realized gains,
if any, are distributed annually on a pro rata basis to common and preferred
shareholders. Distributions from net realized gains for book purposes may
include short-term capital gains, which are included as ordinary income for tax
purposes.
The tax character of distributions paid during the years ended October 31,
2004 and 2003 was as follows:
<Table>
<Caption>
2004 2003
Distribution paid from:
Ordinary Income........................................... $ 71,612 $190,906
Long-term capital gain.................................... 945,753 -0-
---------- --------
$1,017,365 $190,906
========== ========
</Table>
Due to inherent differences in the recognition of income, expenses and
realized gains/losses under accounting principles generally accepted in the
United States of America and federal income tax purposes, permanent differences
between book and tax basis reporting have been identified and appropriately
reclassified on the Statement of Assets and Liabilities. A permanent book and
tax difference of $37,650 related to book and tax accretion differences was
reclassified from accumulated undistributed net investment income to accumulated
net realized loss.
As of October 31, 2004, the components of distributable earnings on a tax
basis were as follows:
<Table>
Undistributed ordinary income............................... $198,860
</Table>
Net realized gains or losses may differ for financial and tax reporting
purposes primarily as a result of gains or losses recognized for tax purposes on
open futures transactions on October 31, 2004.
F. EXPENSE REDUCTION During the year ended October 31, 2004, the Trust's custody
fee was reduced by $508 as a result of credits earned on cash balances.
31
VAN KAMPEN MUNICIPAL TRUST
NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued
2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES
Under the terms of the Trust's Investment Advisory Agreement, the Adviser
provides investment advice and facilities to the Trust for an annual fee payable
monthly of .60% of the average daily net assets of the Trust. Effective November
1, 2004, the investment advisory fee was reduced from .60% to .55%. In addition,
the Trust paid a monthly administrative fee to Van Kampen Investments Inc. or
its affiliates (collectively "Van Kampen"), the Trust's Administrator, at an
annual rate of .05% of the average daily net assets of the Trust. Effective June
1, 2004, the administrative fee was reduced from .05% to .00%.
For the year ended October 31, 2004, the Trust recognized expenses of
approximately $55,000 representing legal services provided by Skadden, Arps,
Slate, Meagher & Flom LLP, counsel to the Trust, of which a trustee of the Trust
is a partner who provides legal services to the Trust, and is therefore an
affiliated person.
Under separate Accounting Services and Legal Services agreements, the
Adviser provides accounting and legal services to the Trust. The Adviser
allocates the cost of such services to each trust. For the year ended October
31, 2004, the Trust recognized expenses of approximately $65,400 representing
Van Kampen's cost of providing accounting and legal services to the Trust, which
are reported as part of "Other" and "Legal" expenses, respectively, in the
Statement of Operations.
Certain officers and trustees of the Trust are also officers and directors
of Van Kampen. The Trust does not compensate its officers or trustees who are
also officers of Van Kampen.
The Trust provides deferred compensation and retirement plans for its
trustees who are not officers of Van Kampen. Under the deferred compensation
plan, trustees may elect to defer all or a portion of their compensation to a
later date. Benefits under the retirement plan are payable upon retirement for a
ten-year period and are based upon each trustee's years of service to the Trust.
The maximum annual benefit per trustee under the plan is $2,500.
3. INVESTMENT TRANSACTIONS
During the period, the cost of purchases and proceeds from sales of investments,
excluding short-term investments, were $165,364,191 and $164,885,171,
respectively.
4. DERIVATIVE FINANCIAL INSTRUMENTS
A derivative financial instrument in very general terms refers to a security
whose value is "derived" from the value of an underlying asset, reference rate
or index.
In order to seek to manage the interest rate exposure of the Trust's
portfolio in a changing interest rate environment, the Trust may purchase or
sell financial futures contracts or engage in transactions involving interest
rate swaps, caps, floors or collars. The Trust expects to enter into these
transactions primarily as a hedge against anticipated interest rate or
fixed-income market changes, for duration management or for risk management
purposes, but may also enter into these transactions to generate additional
income. All of the Trust's portfolio holdings, including derivative instruments,
are marked to market each day with the change in value reflected in the
unrealized appreciation/depreciation. Upon disposition, a realized gain or loss
is recognized accordingly, except when taking delivery of a security underlying
a futures contract. In this instance, the recognition of gain or loss is
postponed until the disposal of the security underlying the futures contract.
Risks may arise as a result of the potential inability of the counterparties to
meet the terms of their contracts.
32
VAN KAMPEN MUNICIPAL TRUST
NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued
Summarized below are the specific types of derivative financial instruments
used by the Fund.
A. FUTURES CONTRACTS A futures contract is an agreement involving the delivery
of a particular asset on a specified future date at an agreed upon price. The
Trust generally invests in exchange traded futures contracts on U.S. Treasury
Bonds and Notes and typically closes the contract prior to the delivery date.
Futures contracts are valued at the settlement price established each day on the
exchange on which they are traded.
Upon entering into futures contracts, the Trust maintains an amount of cash
or liquid securities with a value equal to a percentage of the contract amount
with either a future commission merchant pursuant to rules and regulations
promulgated under the 1940 Act, as amended, or with its custodian in an account
in the broker's name. This amount is known as initial margin. During the period
the futures contract is open, payments are received from or made to the broker
based upon changes in the value of the contract (the variation margin). The risk
of loss associated with a futures contract is in excess of the variation margin
reflected on the Statement of Assets and Liabilities.
Transactions in futures contracts for the year ended October 31, 2004, were
as follows:
<Table>
<Caption>
CONTRACTS
Outstanding at October 31, 2003............................. 98
Futures Opened.............................................. 104
Futures Closed.............................................. (180)
----
Outstanding at October 31, 2004............................. 22
====
</Table>
The futures contracts outstanding as of October 31, 2004, and the
descriptions and unrealized appreciation/depreciation are as follows:
<Table>
<Caption>
UNREALIZED
SHORT CONTRACTS CONTRACTS DEPRECIATION
U.S. Treasury Notes 10-Year Futures
December 2004 (Current Notional Value of $113,563 per
contract)............................................... 4 $ (4,578)
U.S. Treasury Notes 5-Year Futures
December 2004 (Current Notional Value of $111,375 per
contract)............................................... 18 (11,322)
-- --------
22 $(15,900)
== ========
</Table>
B. INVERSE FLOATING RATE SECURITIES An Inverse Floating Rate security is one
where the coupon is inversely indexed to a short-term floating interest rate
multiplied by a specified factor. As the floating rate rises, the coupon is
reduced. Conversely as the floating rate declines, the coupon is increased. The
price of these securities may be more volatile than the price of a comparable
fixed rate security. These instruments are typically used by the Trust to
enhance the yield of the portfolio.
5. PREFERRED SHARES
The Trust has outstanding 12,000 Auction Preferred Shares ("APS") in four series
of 3,000 shares each. Dividends are cumulative and the dividend rate is
periodically reset through an auction process. The dividend periods for Series A
and C are generally 7 days.
33
VAN KAMPEN MUNICIPAL TRUST
NOTES TO FINANCIAL STATEMENTS -- OCTOBER 31, 2004 continued
The dividend periods for Series B and D are 28 days. The average rate in effect
on October 31, 2004 was 1.538%. During the year ended October 31, 2004, the
rates ranged from 0.590% to 1.760%.
The Trust pays annual fees equivalent to .25% of the preferred share
liquidation value for the remarketing efforts associated with the preferred
auctions. These fees are included as a component of "Preferred Share
Maintenance" expense in the Statement of Operations.
The APS are redeemable at the option of the Trust in whole or in part at the
liquidation value of $25,000 per share plus accumulated and unpaid dividends.
The Trust is subject to certain asset coverage tests, and the APS are subject to
mandatory redemption if the tests are not met.
6. INDEMNIFICATIONS
The Trust enters into contracts that contain a variety of indemnifications. The
Trust's maximum exposure under these arrangements is unknown. However, the Trust
has not had prior claims or losses pursuant to these contracts and expects the
risk of loss to be remote.
34
VAN KAMPEN MUNICIPAL TRUST
REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Board of Trustees and Shareholders of Van Kampen Municipal Trust
We have audited the accompanying statement of assets and liabilities of Van
Kampen Municipal Trust (the "Trust"), including the portfolio of investments, as
of October 31, 2004, the related statement of operations for the year then
ended, the statements of changes in net assets for each of the two years in the
period then ended, and the financial highlights for each of the five years in
the period then ended. These financial statements and financial highlights are
the responsibility of the Trust's management. Our responsibility is to express
an opinion on these financial statements and financial highlights based on our
audits. The Trust's financial highlights for the periods ended prior to October
31, 2000 were audited by other auditors whose report, dated December 6, 1999,
expressed an unqualified opinion on those financial highlights.
We conducted our audits in accordance with standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. Our procedures included confirmation of
securities owned as of October 31, 2004, by correspondence with the Trust's
custodian and brokers. An audit also includes assessing the accounting
principles used and significant estimates made by management, as well as
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred
to above present fairly, in all material respects, the financial position of Van
Kampen Municipal Trust as of October 31, 2004, the results of its operations for
the year then ended, the changes in its net assets and the financial highlights
for the respective stated periods, in conformity with accounting principles
generally accepted in the United States of America.
DELOITTE & TOUCHE LLP
Chicago, Illinois
December 10, 2004
35
VAN KAMPEN MUNICIPAL TRUST
DIVIDEND REINVESTMENT PLAN
The Trust offers a dividend reinvestment plan (the "Plan") pursuant to which
Common Shareholders may elect to have dividends and capital gains distributions
reinvested in Common Shares of the Trust. The Trust declares dividends out of
net investment income, and will distribute annually net realized capital gains,
if any. Common Shareholders may join or withdraw from the Plan at any time.
If you decide to participate in the Plan, State Street Bank and Trust
Company, as your Plan Agent, will automatically invest your dividends and
capital gains distributions in Common Shares of the Trust for your account.
HOW TO PARTICIPATE
If you wish to participate and your shares are held in your own name, call
1-800-341-2929 for more information and a Plan brochure. If your shares are held
in the name of a brokerage firm, bank, or other nominee, you should contact your
nominee to see if it would participate in the Plan on your behalf. If you wish
to participate in the Plan, but your brokerage firm, bank or nominee is unable
to participate on your behalf, you should request that your shares be
re-registered in your own name which will enable your participation in the Plan.
HOW THE PLAN WORKS
Participants in the Plan will receive the equivalent in Common Shares valued
on the valuation date, generally at the lower of market price or net asset
value, except as specified below. The valuation date will be the dividend or
distribution payment date or, if that date is not a trading day on the national
securities exchange or market system on which the Common Shares are listed for
trading, the next preceding trading day. If the market price per Common Share on
the valuation date equals or exceeds net asset value per Common Share on that
date, the Trust will issue new Common Shares to participants valued at the
higher of net asset value or 95% of the market price on the valuation date. In
the foregoing situation, the Trust will not issue Common Shares under the Plan
below net asset value. If net asset value per Common Share on the valuation date
exceeds the market price per Common Share on that date, or if the Board of
Trustees should declare a dividend or capital gains distribution payable to the
Common Shareholders only in cash, participants in the Plan will be deemed to
have elected to receive Common Shares from the Trust valued at the market price
on that date. Accordingly, in this circumstance, the Plan Agent will, as agent
for the participants, buy the Trust's Common Shares in the open market for the
participants' accounts on or shortly after the payment date. If, before the Plan
Agent has completed its purchases, the market price exceeds the net asset value
per share of the Common Shares, the average per share purchase price paid by the
Plan Agent may exceed the net asset value
36
VAN KAMPEN MUNICIPAL TRUST
DIVIDEND REINVESTMENT PLAN continued
of the Trust's Common Shares, resulting in the acquisition of fewer Common
Shares than if the dividend or distribution had been paid in Common Shares
issued by the Trust. All reinvestments are in full and fractional Common Shares
and are carried to three decimal places.
Experience under the Plan may indicate that changes are desirable.
Accordingly, the Trust reserves the right to amend or terminate the Plan as
applied to any dividend or distribution paid subsequent to written notice of the
changes sent to all Common Shareholders of the Trust at least 90 days before the
record date for the dividend or distribution. The Plan also may be amended or
terminated by the Plan Agent by at least 90 days written notice to all Common
Shareholders of the Trust.
COSTS OF THE PLAN
The Plan Agent's fees for the handling of the reinvestment of dividends and
distributions will be paid by the Trust. However, each participant will pay a
prorata share of brokerage commissions incurred with respect to the Plan Agent's
open market purchases in connection with the reinvestment of dividends and
distributions. No other charges will be made to participants for reinvesting
dividends or capital gains distributions, except for certain brokerage
commissions, as described above.
TAX IMPLICATIONS
You will receive tax information annually for your personal records and to
help you prepare your federal income tax return. The automatic reinvestment of
dividends and capital gains distributions does not relieve you of any income tax
which may be payable on dividends or distributions.
RIGHT TO WITHDRAW
Plan participants may withdraw at any time by calling 1-800-341-2929 or by
writing State Street Bank and Trust Company, P.O. Box 8200, Boston, MA
02266-8200. If you withdraw, you will receive, without charge, a share
certificate issued in your name for all full Common Shares credited to your
account under the Plan and a cash payment will be made for any fractional Common
Share credited to your account under the Plan. You may again elect to
participate in the Plan at any time by calling 1-800-341-2929 or writing to the
Trust at:
Van Kampen Funds Inc.
Attn: Closed-End Funds
2800 Post Oak Blvd.
Houston, TX 77056
37
VAN KAMPEN MUNICIPAL TRUST
BOARD OF TRUSTEES AND IMPORTANT ADDRESSES
BOARD OF TRUSTEES
DAVID C. ARCH
J. MILES BRANAGAN
JERRY D. CHOATE
ROD DAMMEYER
LINDA HUTTON HEAGY
R. CRAIG KENNEDY
HOWARD J KERR
MITCHELL M. MERIN*
JACK E. NELSON
RICHARD F. POWERS, III*
HUGO F. SONNENSCHEIN
WAYNE W. WHALEN* - Chairman
SUZANNE H. WOOLSEY
INVESTMENT ADVISER
VAN KAMPEN ASSET MANAGEMENT
1221 Avenue of the Americas
New York, New York 10020
CUSTODIAN AND TRANSFER AGENT
STATE STREET BANK
AND TRUST COMPANY
c/o EquiServe
P.O. Box 43011
Providence, Rhode Island 02940-3011
LEGAL COUNSEL
SKADDEN, ARPS, SLATE,
MEAGHER & FLOM LLP
333 West Wacker Drive
Chicago, Illinois 60606
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
DELOITTE & TOUCHE LLP
180 North Stetson Avenue
Chicago, Illinois 60601
For federal income tax purposes, the following information is furnished with
respect to the distributions paid by the Trust during its taxable year ended
October 31, 2004. The Trust designated 99.8% of the income distributions as a
tax-exempt income distribution. The Trust designated and paid $945,753 as a
long-term capital gain distribution. In January, the Trust provides tax
information to shareholders for the preceding calendar year.
* "Interested persons" of the Trust, as defined in the Investment Company Act
of 1940, as amended.
38
VAN KAMPEN MUNICIPAL TRUST
RESULTS OF SHAREHOLDER VOTES
The Annual Meeting of the Shareholders of the Trust was held on June 23, 2004,
where shareholders voted on the election of trustees.
1) With regard to the election of the following trustees by the common
shareholders of the Trust:
<Table>
<Caption>
# OF SHARES
------------------------------
IN FAVOR WITHHELD
- ------------------------------------------------------------------------------------------
R. Craig Kennedy.......................................... 32,083,886 845,041
Jack E. Nelson............................................ 32,063,916 865,011
Richard F. Powers, III.................................... 32,091,066 837,861
</Table>
2) With regard to the election of the following trustee by the preferred
shareholders of the Trust:
<Table>
<Caption>
# OF SHARES
----------------------------
IN FAVOR WITHHELD
- ------------------------------------------------------------------------------------------
Hugo Sonnenschein........................................... 10,306 44
</Table>
The other trustees of the Trust whose terms did not expire in 2004 are David C.
Arch, J. Miles Branagan, Jerry D. Choate, Rod Dammeyer, Linda Hutton Heagy,
Howard J Kerr, Mitchell M. Merin, Wayne W. Whalen, and Suzanne H. Woolsey.
39
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION
The business and affairs of the Trust are managed under the direction of the
Trust's Board of Trustees and the Trust's officers appointed by the Board of
Trustees. The tables below list the trustees and executive officers of the Trust
and their principal occupations during the last five years, other directorships
held by trustees and their affiliations, if any, with Van Kampen Investments
Inc. ("Van Kampen Investments"), Van Kampen Asset Management (the "Adviser"),
Van Kampen Funds Inc. (the "Distributor"), Van Kampen Advisors Inc., Van Kampen
Exchange Corp. and Van Kampen Investor Services Inc. ("Investor Services"). The
term "Fund Complex" includes each of the investment companies advised by the
Adviser or its affiliates as of the date of this Statement of Additional
Information. Trustees serve until reaching their retirement age or until their
successors are duly elected and qualified. Officers are annually elected by the
trustees.
INDEPENDENT TRUSTEES:
<Table>
<Caption>
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
David C. Arch (59) Trustee Trustee Chairman and Chief 85 Trustee/Director/Managing
Blistex Inc. since 1991 Executive Officer of General Partner of funds
1800 Swift Drive Blistex Inc., a consumer in the Fund Complex.
Oak Brook, IL 60523 health care products
manufacturer. Director of
the Heartland Alliance, a
nonprofit organization
serving human needs based
in Chicago. Director of
St. Vincent de Paul
Center, a Chicago based
day care facility serving
the children of low
income families. Board
member of the Illinois
Manufacturers'
Association.
J. Miles Branagan (72) Trustee Trustee Private investor. 83 Trustee/Director/Managing
1632 Morning Mountain Road since 2003 Co-founder, and prior to General Partner of funds
Raleigh, NC 27614 August 1996, Chairman, in the Fund Complex.
Chief Executive Officer
and President, MDT
Corporation (now known as
Getinge/Castle, Inc., a
subsidiary of Getinge
Industrier AB), a company
which develops,
manufactures, markets and
services medical and
scientific equipment.
</Table>
40
<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Jerry D. Choate (66) Trustee Trustee Prior to January 1999, 83 Trustee/Director/Managing
33971 Selva Road since 2003 Chairman and Chief General Partner of funds
Suite 130 Executive Officer of the in the Fund Complex.
Dana Point, CA 92629 Allstate Corporation Director of Amgen Inc., a
("Allstate") and Allstate biotechnological company,
Insurance Company. Prior and Director of Valero
to January 1995, Energy Corporation, an
President and Chief independent refining
Executive Officer of company.
Allstate. Prior to August
1994, various management
positions at Allstate.
</Table>
41
<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Rod Dammeyer (64) Trustee Trustee President of CAC, L.L.C., 85 Trustee/Director/Managing
CAC, L.L.C. since 1991 a private company General Partner of funds
4350 LaJolla Village Drive offering capital in the Fund Complex.
Suite 980 investment and management Director of Stericycle,
San Diego, CA 92122-6223 advisory services. Prior Inc., Ventana Medical
to February 2001, Vice Systems, Inc., and GATX
Chairman and Director of Corporation, and Trustee
Anixter International, of The Scripps Research
Inc., a global Institute and the
distributor of wire, University of Chicago
cable and communications Hospitals and Health
connectivity products. Systems. Prior to January
Prior to July 2000, 2004, Director of
Managing Partner of TeleTech Holdings Inc.
Equity Group Corporate and Arris Group, Inc.
Investment (EGI), a Prior to May 2002,
company that makes Director of Peregrine
private investments in Systems Inc. Prior to
other companies. February 2001, Director
of IMC Global Inc. Prior
to July 2000, Director of
Allied Riser
Communications Corp.,
Matria Healthcare Inc.,
Transmedia Networks,
Inc., CNA Surety, Corp.
and Grupo Azcarero Mexico
(GAM).
</Table>
42
<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Linda Hutton Heagy (56) Trustee Trustee Managing Partner of 83 Trustee/Director/Managing
Heidrick & Struggles since 2003 Heidrick & Struggles, an General Partner of funds
233 South Wacker Drive executive search firm. in the Fund Complex.
Suite 7000 Trustee on the University
Chicago, IL 60606 of Chicago Hospitals
Board, Vice Chair of the
Board of the YMCA of
Metropolitan Chicago and
a member of the Women's
Board of the University
of Chicago. Prior to
1997, Partner of Ray &
Berndtson, Inc., an
executive recruiting
firm. Prior to 1996,
Trustee of The
International House
Board, a fellowship and
housing organization for
international graduate
students. Prior to 1995,
Executive Vice President
of ABN AMRO, N.A., a bank
holding company. Prior to
1992, Executive Vice
President of La Salle
National Bank.
R. Craig Kennedy (52) Trustee Trustee Director and President of 83 Trustee/Director/Managing
1744 R Street, NW since 2003 the German Marshall Fund General Partner of funds
Washington, DC 20009 of the United States, an in the Fund Complex.
independent U.S.
foundation created to
deepen understanding,
promote collaboration and
stimulate exchanges of
practical experience
between Americans and
Europeans. Formerly,
advisor to the Dennis
Trading Group Inc., a
managed futures and
option company that
invests money for
individuals and
institutions. Prior to
1992, President and Chief
Executive Officer,
Director and member of
the Investment Committee
of the Joyce Foundation,
a private foundation.
Howard J Kerr (69) Trustee Trustee Prior to 1998, President 85 Trustee/Director/Managing
736 North Western Avenue since 1992 and Chief Executive General Partner of funds
P.O. Box 317 Officer of Pocklington in the Fund Complex.
Lake Forest, IL 60045 Corporation, Inc., an Director of the Lake
investment holding Forest Bank & Trust.
company. Director of the
Marrow Foundation.
</Table>
43
<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Jack E. Nelson (68) Trustee Trustee President of Nelson 83 Trustee/Director/Managing
423 Country Club Drive since 2003 Investment Planning General Partner of funds
Winter Park, FL 32789 Services, Inc., a in the Fund Complex.
financial planning
company and registered
investment adviser in the
State of Florida.
President of Nelson Ivest
Brokerage Services Inc.,
a member of the NASD,
Securities Investors
Protection Corp. and the
Municipal Securities
Rulemaking Board.
President of Nelson Sales
and Services Corporation,
a marketing and services
company to support
affiliated companies.
Hugo F. Sonnenschein (64) Trustee Trustee President Emeritus and 85 Trustee/Director/Managing
1126 E. 59th Street since 1994 Honorary Trustee of the General Partner of funds
Chicago, IL 60637 University of Chicago and in the Fund Complex.
the Adam Smith Director of Winston
Distinguished Service Laboratories, Inc.
Professor in the
Department of Economics
at the University of
Chicago. Prior to July
2000, President of the
University of Chicago.
Trustee of the University
of Rochester and a member
of its investment
committee. Member of the
National Academy of
Sciences, the American
Philosophical Society and
a fellow of the American
Academy of Arts and
Sciences.
Suzanne H. Woolsey, Ph.D. Trustee Trustee Chief Communications 83 Trustee/Director/Managing
(62) since 2003 Officer of the National General Partner of funds
815 Cumberstone Road Academy of in the Fund Complex.
Harwood, MD 20776 Sciences/National Director of Fluor Corp.,
Research Council, an an engineering,
independent, federally procurement and
chartered policy construction
institution, from 2001 to organization, since
November 2003 and Chief January 2004 and Director
Operating Officer from of Neurogen Corporation,
1993 to 2001. Director of a pharmaceutical company,
the Institute for Defense since January 1998.
Analyses, a federally
funded research and
development center,
Director of the German
Marshall Fund of the
United States, Director
of the Rocky Mountain
Institute and Trustee of
Colorado College. Prior
to 1993, Executive
Director of the
Commission on Behavioral
and Social Sciences and
Education at the National
Academy of
Sciences/National
Research Council. From
1980 through 1989,
Partner of Coopers &
Lybrand.
</Table>
44
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
INTERESTED TRUSTEES:*
<Table>
<Caption>
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Mitchell M. Merin* (51) Trustee, Trustee President and Chief 83 Trustee/Director/Managing
1221 Avenue of the Americas President since Executive Officer of General Partner of funds
New York, NY 10020 and Chief 2003; funds in the Fund in the Fund Complex.
Executive President Complex. Chairman,
Officer and Chief President, Chief
Executive Executive Officer and
Officer Director of the Adviser
since 2002 and Van Kampen Advisors
Inc. since December 2002.
Chairman, President and
Chief Executive Officer
of Van Kampen Investments
since December 2002.
Director of Van Kampen
Investments since
December 1999. Chairman
and Director of Van
Kampen Funds Inc. since
December 2002. President,
Director and Chief
Operating Officer of
Morgan Stanley Investment
Management since December
1998. President and
Director since April 1997
and Chief Executive
Officer since June 1998
of Morgan Stanley
Investment Advisors Inc.
and Morgan Stanley
Services Company Inc.
Chairman, Chief Executive
Officer and Director of
Morgan Stanley
Distributors Inc. since
June 1998. Chairman since
June 1998, and Director
since January 1998 of
Morgan Stanley Trust.
Director of various
Morgan Stanley
subsidiaries. President
of the Morgan Stanley
Funds since May 1999.
Previously Chief
Executive Officer of Van
Kampen Funds Inc. from
December 2002 to July
2003, Chief Strategic
Officer of Morgan Stanley
Investment Advisors Inc.
and Morgan Stanley
Services Company Inc. and
Executive Vice President
of Morgan Stanley
Distributors Inc. from
April 1997 to June 1998.
Chief Executive Officer
from September 2002 to
April 2003 and Vice
President from May 1997
to April 1999 of the
Morgan Stanley Funds.
</Table>
45
<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
NUMBER OF
TERM OF FUNDS IN
OFFICE AND FUND
POSITION(S) LENGTH OF COMPLEX
NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS
OF INTERESTED TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE
Richard F. Powers, III* (58) Trustee Trustee Advisory Director of 85 Trustee/Director/Managing
1 Parkview Plaza since 1999 Morgan Stanley. Prior to General Partner of funds
P.O. Box 5555 December 2002, Chairman, in the Fund Complex.
Oakbrook Terrace, IL 60181 Director, President,
Chief Executive Officer
and Managing Director of
Van Kampen Investments
and its investment
advisory, distribution
and other subsidiaries.
Prior to December 2002,
President and Chief
Executive Officer of
funds in the Fund
Complex. Prior to May
1998, Executive Vice
President and Director of
Marketing at Morgan
Stanley and Director of
Dean Witter, Discover &
Co. and Dean Witter
Realty. Prior to 1996,
Director of Dean Witter
Reynolds Inc.
Wayne W. Whalen* (65) Trustee Trustee Partner in the law firm 85 Trustee/Director/Managing
333 West Wacker Drive since 1991 of Skadden, Arps, Slate, General Partner of funds
Chicago, IL 60606 Meagher & Flom LLP, legal in the Fund Complex.
counsel to funds in the
Fund Complex.
</Table>
* Such Trustee is an "interested person" (within the meaning of Section
2(a)(19) of the 1940 Act). Mr. Whalen is an interested person of certain
funds in the Fund Complex by reason of his firm currently acting as legal
counsel to such funds in the Fund Complex. Messrs. Merin and Powers are
interested persons of funds in the Fund Complex and the Adviser by reason of
their current or former positions with Morgan Stanley or its affiliates.
46
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
OFFICERS:
<Table>
<Caption>
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER TRUST SERVED DURING PAST 5 YEARS
Stefanie V. Chang (38) Vice President Officer Executive Director of Morgan Stanley Investment Management.
1221 Avenue of the Americas and Secretary since 2003 Vice President of funds in the Fund Complex.
New York, NY 10020
Amy R. Doberman (42) Vice President Officer Managing Director and General Counsel, U.S. Investment
1221 Avenue of the Americas since 2004 Management; Managing Director of Morgan Stanley Investment
New York, NY 10020 Management, Inc., Morgan Stanley Investment Advisers Inc.
and the Adviser. Vice President of the Morgan Stanley
Institutional and Retail Funds since July 2004 and Vice
President of funds in the Fund Complex as of August 2004.
Previously, Managing Director and General Counsel of
Americas, UBS Global Asset Management from July 2000 to July
2004 and General Counsel of Aeitus Investment Management,
Inc. from January 1997 to July 2000.
James M. Dykas (38) Chief Financial Officer Executive Director of Van Kampen Asset Management and Morgan
1 Parkview Plaza Officer and since 1999 Stanley Investment Management. Chief Financial Officer and
Oakbrook Terrace, IL 60181 Treasurer Treasurer of funds in the Fund Complex. Prior to August
2004, Assistant Treasurer of funds in the Fund Complex.
Joseph J. McAlinden (61) Executive Vice Officer Managing Director and Chief Investment Officer of Morgan
1221 Avenue of the Americas President and since 2002 Stanley Investment Advisors Inc., and Morgan Stanley
New York, NY 10020 Chief Investment Investment Management Inc. and Director of Morgan Stanley
Officer Trust for over 5 years. Executive Vice President and Chief
Investment Officer of funds in the Fund Complex. Managing
Director and Chief Investment Officer of Van Kampen
Investments, the Adviser and Van Kampen Advisors Inc. since
December 2002.
Ronald E. Robison (65) Executive Vice Officer Principal Executive Officer of the Funds since May 2003.
1221 Avenue of the Americas President and since 2003 Chief Executive Officer and Chairman of Investor Services.
New York, NY 10020 Principal Executive Vice President and Principal Executive Officer of
Executive funds in the Fund Complex. Managing Director of Morgan
Officer Stanley. Chief Administrative Officer, Managing Director and
Director of Morgan Stanley Investment Advisors Inc., Morgan
Stanley Services Company Inc. and Managing Director and
Director of Morgan Stanley Distributors Inc. Chief Executive
Officer and Director of Morgan Stanley Trust. Executive Vice
President and Principal Executive Officer of the
Institutional and Retail Morgan Stanley Funds; Director of
Morgan Stanley SICAV; previously Chief Global Operations
Officer and Managing Director of Morgan Stanley Investment
Management Inc.
</Table>
47
<Table>
<Caption>
VAN KAMPEN MUNICIPAL TRUST
TRUSTEE AND OFFICER INFORMATION continued
TERM OF
OFFICE AND
POSITION(S) LENGTH OF
NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S)
ADDRESS OF OFFICER TRUST SERVED DURING PAST 5 YEARS
John L. Sullivan (49) Chief Compliance Officer Chief Compliance Officer of funds in the Fund Complex since
1 Parkview Plaza Officer since 1998 August 2004. Director and Managing Director of Van Kampen
Oakbrook Terrace, IL 60181 Investments, the Adviser, Van Kampen Advisors Inc. and
certain other subsidiaries of Van Kampen Investments. Prior
August 2004, Vice President, Chief Financial Officer and
Treasurer of funds in the Fund Complex and head of Fund
Accounting for Morgan Stanley Investment Management. Prior
to December 2002, Executive Director of Van Kampen
Investments, the Adviser and Van Kampen Advisors Inc.
</Table>
48
VAN KAMPEN
AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY
We are required by federal law to provide you with a copy of our Privacy
Policy annually.
The following Policy applies to current and former individual clients of Van
Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors Inc.,
Van Kampen Funds Inc., Van Kampen Investor Services Inc. and Van Kampen Exchange
Corp., as well as current and former individual investors in Van Kampen mutual
funds, unit investment trusts, and related companies.
This Policy is not applicable to partnerships, corporations, trusts or other
non-individual clients or account holders, nor is this Policy applicable to
individuals who are either beneficiaries of a trust for which we serve as
trustee or participants in an employee benefit plan administered or advised by
us. This Policy is, however, applicable to individuals who select us to be a
custodian of securities or assets in individual retirement accounts, 401(k)
accounts, 529 Educational Savings Accounts, accounts subject to the Uniform
Gifts to Minors Act, or similar accounts.
Please note that we may amend this Policy at any time, and will inform you
of any changes to this Policy as required by law.
WE RESPECT YOUR PRIVACY
We appreciate that you have provided us with your personal financial
information. We strive to maintain the privacy of such information while we help
you achieve your financial objectives. This Policy describes what non-public
personal information we collect about you, why we collect it, and when we may
share it with others.
We hope this Policy will help you understand how we collect and share
non-public personal information that we gather about you. Throughout this
Policy, we refer to the non-public information that personally identifies you or
your accounts as "personal information."
1. WHAT PERSONAL INFORMATION DO WE COLLECT ABOUT YOU?
To serve you better and manage our business, it is important that we collect and
maintain accurate information about you. We may obtain this information from
applications and other forms you submit to us, from your dealings with us, from
consumer reporting agencies, from our Web sites and from third parties and other
sources.
For example:
-- We may collect information such as your name, address, e-mail address,
telephone/fax numbers, assets, income and investment objectives through
applications and other forms you submit to us.
-- We may obtain information about account balances, your use of
account(s) and the types of products and services you prefer to receive
from us through your dealings and transactions with us and other
sources.
-- We may obtain information about your creditworthiness and credit
history from consumer reporting agencies.
-- We may collect background information from and through third-party
vendors to verify representations you have made and to comply with
various regulatory requirements.
-- If you interact with us through our public and private Web sites, we
may collect information that you provide directly through online
communications (such as an e-mail address). We may also collect
information about your Internet service provider, your domain name,
your computer's operating system and Web browser,
(continued on back)
VAN KAMPEN
AN IMPORTANT NOTICE CONCERNING OUR U.S. PRIVACY POLICY continued
your use of our Web sites and your product and service preferences,
through the use of "cookies." "Cookies" recognize your computer each
time you return to one of our sites, and help to improve our sites'
content and personalize your experience on our sites by, for example,
suggesting offerings that may interest you. Please consult the Terms of
Use of these sites for more details on our use of cookies.
2. WHEN DO WE DISCLOSE PERSONAL INFORMATION WE COLLECT ABOUT YOU?
To provide you with the products and services you request, to serve you better
and to manage our business, we may disclose personal information we collect
about you to our affiliated companies and to non-affiliated third parties as
required or permitted by law.
A. INFORMATION WE DISCLOSE TO OUR AFFILIATED COMPANIES. We do not disclose
personal information that we collect about you to our affiliated companies
except to enable them to provide services on our behalf or as otherwise required
or permitted by law.
B. INFORMATION WE DISCLOSE TO THIRD PARTIES. We do not disclose personal
information that we collect about you to non-affiliated third parties except to
enable them to provide services on our behalf, to perform joint marketing
agreements with other financial institutions, or as otherwise required or
permitted by law. For example, some instances where we may disclose information
about you to non-affiliated third parties include: for servicing and processing
transactions, to offer our own products and services, to protect against fraud,
for institutional risk control, to respond to judicial process or to perform
services on our behalf. When we share personal information with these companies,
they are required to limit their use of personal information to the particular
purpose for which it was shared and they are not allowed to share personal
information with others except to fulfill that limited purpose.
3. HOW DO WE PROTECT THE SECURITY AND CONFIDENTIALITY OF PERSONAL INFORMATION WE
COLLECT ABOUT YOU?
We maintain physical, electronic and procedural security measures to help
safeguard the personal information we collect about you. We have internal
policies governing the proper handling of client information. Third parties that
provide support or marketing services on our behalf may also receive personal
information, and we require them to adhere to confidentiality standards with
respect to such information.
Van Kampen Funds Inc.
1 Parkview Plaza, P.O. Box 5555
Oakbrook Terrace, IL 60181-5555
www.vankampen.com
(VAN KAMPEN INVESTMENTS LOGO)
Copyright (C)2004 Van Kampen
Funds Inc. All rights reserved.
Member NASD/SIPC.
VKQ ANR 12/04 RN04-02826P-Y10/04
Item 2. Code of Ethics.
(a) The Trust has adopted a code of ethics (the "Code of Ethics") that applies
to its principal executive officer, principal financial officer, principal
accounting officer or controller, or persons performing similar functions,
regardless of whether these individuals are employed by the Trust or a third
party.
(b) No information need be disclosed pursuant to this paragraph.
(c) The Trust has amended its Code of Ethics during the period covered by the
shareholder report presented in Item 1 hereto to delete from the end of the
following paragraph on page 2 of the Code the phrase "to the detriment of the
Fund.":
"Each Covered Officer must not use his personal influence or personal
relationship improperly to influence investment decisions or financial reporting
by the Fund whereby the Covered Officer would benefit personally (directly or
indirectly)."
Further, due to personnel changes at the Adviser, the list of Covered Officers
set forth in Exhibit B and the General Counsel designee to whom questions about
the application of the Code should be referred in Exhibit C have been amended.
(d) Not applicable.
(e) Not applicable.
(f)
(1) The Trust's Code of Ethics is attached hereto as Exhibit 11A.
(2) Not applicable.
(3) Not applicable.
Item 3. Audit Committee Financial Expert.
The Trust's Board of Trustees has determined that it has three "audit committee
financial experts" serving on its audit committee, each of whom are
"independent" Trustees: J. Miles Branagan, Jerry Choate and R. Craig Kennedy.
Under applicable securities laws, a person who is determined to be an audit
committee financial expert will not be deemed an "expert" for any purpose,
including without limitation for the purposes of Section 11 of the Securities
Act of 1933, as a result of being designated or identified as an audit committee
financial expert. The designation or identification of a person as an audit
committee financial expert does not impose on such person any duties,
obligations, or liabilities that are greater than the duties, obligations, and
liabilities imposed on such person as a member of the audit committee and Board
of Trustees in the absence of such designation or identification.
Item 4. Principal Accountant Fees and Services.
(a)(b)(c)(d) and (g). Based on fees billed for the periods shown:
2004
REGISTRANT COVERED ENTITIES(1)
AUDIT FEES.................. $29,480 N/A
NON-AUDIT FEES
AUDIT-RELATED FEES..... $370(2) $198,000(3)
TAX FEES............... $1,550(4) $0
ALL OTHER FEES......... $0 $0
TOTAL NON-AUDIT FEES........ $1,920 $198,000
TOTAL....................... $31,400 $198,000
2003
REGISTRANT COVERED ENTITIES(1)
AUDIT FEES.................. $27,574 N/A
NON-AUDIT FEES
AUDIT-RELATED FEES..... $370(2) $230,000(3)
TAX FEES............... $1,500(4) $0
ALL OTHER FEES......... $0 $0
TOTAL NON-AUDIT FEES........ $1,870 $230,000
TOTAL....................... $29,444 $230,000
N/A- Not applicable, as not required by Item 4.
(1) Covered Entities include the Adviser (excluding sub-advisors)
and any entity controlling, controlled by or under common
control with the Adviser that provides ongoing services to the
Registrant.
(2) Audit-Related Fees represent agreed upon procedures provided
that are reasonably related to the performance of the audit of
the financial statements of the Registrant.
(3) Audit-Related Fees represent assurance and related services
provided that are reasonably related to the performance of the
audit of the financial statements of the Covered Entities' and
funds advised by the Adviser or its affiliates, specifically
attestation services provided in connection with a SAS 70
Report.
(4) Tax Fees represent tax advice and compliance services provided
in connection with the review of the Registrant's tax.
(e)(1) The audit committee's pre-approval policies and procedures are as
follows:
JOINT AUDIT COMMITTEE
AUDIT AND NON-AUDIT SERVICES
PRE-APPROVAL POLICY AND PROCEDURES
OF THE
VAN KAMPEN FUNDS
AS ADOPTED JULY 23, 2003 AND AMENDED MAY 26, 2004(1)
1. STATEMENT OF PRINCIPLES
The Audit Committee of the Board is required to review and, in its sole
discretion, pre-approve all Covered Services to be provided by the Independent
Auditors to the Fund and Covered Entities in order to assure that services
performed by the Independent Auditors do not impair the auditor's independence
from the Fund.2
The SEC has issued rules specifying the types of services that an
independent auditor may not provide to its audit client, as well as the audit
committee's administration of the engagement of the independent auditor. The
SEC's rules establish two different approaches to pre-approving services, which
the SEC considers to be equally valid. Proposed services either: may be
pre-approved without consideration of specific case-by-case services by the
Audit Committee ("general pre-approval"); or require the specific pre-approval
of the Audit Committee ("specific pre-approval"). The Audit Committee believes
that the combination of these two approaches in this Policy will result in an
effective and efficient procedure to pre-approve services performed by the
Independent Auditors. As set forth in this Policy, unless a type of service has
received general pre-approval, it will require specific pre-approval by the
Audit Committee (or by any member of the Audit Committee to which pre-approval
authority has been delegated) if it is to be provided by the Independent
Auditors. Any proposed services exceeding pre-approved cost levels or budgeted
amounts will also require specific pre-approval by the Audit Committee.
For both types of pre-approval, the Audit Committee will consider
whether such services are consistent with the SEC's rules on auditor
independence. The Audit Committee will also consider whether the Independent
Auditors are best positioned to provide the most effective and efficient
services, for reasons such as its familiarity with the Fund's business, people,
culture, accounting systems, risk profile and other factors, and whether the
service might enhance the Fund's ability to manage or control risk or improve
audit quality. All such factors will be considered as a whole, and no one factor
should necessarily be determinative.
The Audit Committee is also mindful of the relationship between fees
for audit and non-audit services in deciding whether to pre-approve any such
services and may determine for each fiscal year, the appropriate ratio between
the total amount of fees for Audit, Audit-related and Tax services for the Fund
(including any Audit-related or Tax service fees for Covered Entities that were
subject to pre-approval), and the total amount of fees for certain permissible
non-audit services classified as All Other services for the Fund (including any
such services for Covered Entities subject to pre-approval).
The appendices to this Policy describe the Audit, Audit-related, Tax
and All Other services that have the general pre-approval of the Audit
Committee. The term of any general pre-approval is 12 months from the date of
pre-approval, unless the Audit Committee considers and provides a different
period and states otherwise. The Audit Committee will annually review and
pre-approve the services that may be provided by the Independent Auditors
without obtaining specific pre-approval
- ----------------
(1) This Joint Audit Committee Audit and Non-Audit Services Pre-Approval
Policy and Procedures (the "Policy"), amended as of the date above,
supercedes and replaces all prior versions that may have been amended
from time to time.
(2) Terms used in this Policy and not otherwise defined herein shall have
the meanings as defined in the Joint Audit Committee Charter.
from the Audit Committee. The Audit Committee will add to or subtract from the
list of general pre-approved services from time to time, based on subsequent
determinations.
The purpose of this Policy is to set forth the policy and procedures by
which the Audit Committee intends to fulfill its responsibilities. It does not
delegate the Audit Committee's responsibilities to pre-approve services
performed by the Independent Auditors to management.
The Fund's Independent Auditors have reviewed this Policy and believes
that implementation of the Policy will not adversely affect the Independent
Auditors' independence.
2. DELEGATION
As provided in the Act and the SEC's rules, the Audit Committee may
delegate either type of pre-approval authority to one or more of its members.
The member to whom such authority is delegated must report, for informational
purposes only, any pre-approval decisions to the Audit Committee at its next
scheduled meeting.
3. AUDIT SERVICES
The annual Audit services engagement terms and fees are subject to the
specific pre-approval of the Audit Committee. Audit services include the annual
financial statement audit and other procedures required to be performed by the
Independent Auditors to be able to form an opinion on the Fund's financial
statements. These other procedures include information systems and procedural
reviews and testing performed in order to understand and place reliance on the
systems of internal control, and consultations relating to the audit. The Audit
Committee will monitor the Audit services engagement as necessary, but no less
than on a quarterly basis, and will also approve, if necessary, any changes in
terms, conditions and fees resulting from changes in audit scope, Fund structure
or other items.
In addition to the annual Audit services engagement approved by the
Audit Committee, the Audit Committee may grant general pre-approval to other
Audit services, which are those services that only the Independent Auditors
reasonably can provide. Other Audit services may include statutory audits and
services associated with SEC registration statements (on Forms N-1A, N-2, N-3,
N-4, etc.), periodic reports and other documents filed with the SEC or other
documents issued in connection with securities offerings.
The Audit Committee has pre-approved the Audit services in Appendix
B.1. All other Audit services not listed in Appendix B.1 must be specifically
pre-approved by the Audit Committee (or by any member of the Audit Committee to
which pre-approval has been delegated).
4. AUDIT-RELATED SERVICES
Audit-related services are assurance and related services that are
reasonably related to the performance of the audit or review of the Fund's
financial statements or, to the extent they are Covered Services, the Covered
Entities' financial statements, or that are traditionally performed by the
Independent Auditors. Because the Audit Committee believes that the provision of
Audit-related services does not impair the independence of the auditor and is
consistent with the SEC's rules on auditor independence, the Audit Committee may
grant general pre-approval to Audit-related services. Audit-related services
include, among others, accounting consultations related to accounting, financial
reporting or disclosure matters not classified as "Audit services"; assistance
with understanding and implementing new accounting and financial reporting
guidance from rulemaking authorities; agreed-upon or expanded audit procedures
related to accounting and/or billing records required to respond to or comply
with financial, accounting or regulatory reporting matters; and assistance with
internal control reporting requirements under Forms N-SAR and/or N-CSR.
The Audit Committee has pre-approved the Audit-related services in
Appendix B.2. All other Audit-related services not listed in Appendix B.2 must
be specifically pre-approved by the Audit Committee (or by any member of the
Audit Committee to which pre-approval has been delegated).
5. TAX SERVICES
The Audit Committee believes that the Independent Auditors can provide
Tax services to the Fund and, to the extent they are Covered Services, the
Covered Entities, such as tax compliance, tax planning and tax advice without
impairing the auditor's independence, and the SEC has stated that the
Independent Auditors may provide such services. Hence, the Audit Committee
believes it may grant general pre-approval to those Tax services that have
historically been provided by the Independent Auditors, that the Audit Committee
has reviewed and believes would not impair the independence of the Independent
Auditors, and that are consistent with the SEC's rules on auditor independence.
The Audit Committee will not permit the retention of the Independent Auditors in
connection with a transaction initially recommended by the Independent Auditors,
the sole business purpose of which may be tax avoidance and the tax treatment of
which may not be supported in the Internal Revenue Code and related regulations.
The Audit Committee will consult with Director of Tax or outside counsel to
determine that the tax planning and reporting positions are consistent with this
policy.
Pursuant to the preceding paragraph, the Audit Committee has
pre-approved the Tax Services in Appendix B.3. All Tax services involving large
and complex transactions not listed in Appendix B.3 must be specifically
pre-approved by the Audit Committee (or by any member of the Audit Committee to
which pre-approval has been delegated), including tax services proposed to be
provided by the Independent Auditors to any executive officer or
trustee/director/managing general partner of the Fund, in his or her individual
capacity, where such services are paid for by the Fund (generally applicable
only to internally managed investment companies).
6. ALL OTHER SERVICES
The Audit Committee believes, based on the SEC's rules prohibiting the
Independent Auditors from providing specific non-audit services, that other
types of non-audit services are permitted. Accordingly, the Audit Committee
believes it may grant general pre-approval to those permissible non-audit
services classified as All Other services that it believes are routine and
recurring services, would not impair the independence of the auditor and are
consistent with the SEC's rules on auditor independence.
The Audit Committee has pre-approved the All Other services in Appendix
B.4. Permissible All Other services not listed in Appendix B.4 must be
specifically pre-approved by the Audit Committee (or by any member of the Audit
Committee to which pre-approval has been delegated).
A list of the SEC's prohibited non-audit services is attached to this
policy as Appendix B.5. The SEC's rules and relevant guidance should be
consulted to determine the precise definitions of these services and the
applicability of exceptions to certain of the prohibitions.
7. PRE-APPROVAL FEE LEVELS OR BUDGETED AMOUNTS
Pre-approval fee levels or budgeted amounts for all services to be
provided by the Independent Auditors will be established annually by the Audit
Committee. Any proposed services exceeding these levels or amounts will require
specific pre-approval by the Audit Committee. The Audit Committee is mindful of
the overall relationship of fees for audit and non-audit services in determining
whether to pre-approve any such services. For each fiscal year, the Audit
Committee may determine the appropriate ratio between the total amount of fees
for Audit, Audit-related, and Tax services for the Fund (including any
Audit-related or Tax services fees for Covered Entities subject to
pre-approval), and the total amount of fees for certain permissible non-audit
services classified as All Other services for the Fund (including any such
services for Covered Entities subject to pre-approval).
8. PROCEDURES
All requests or applications for services to be provided by the
Independent Auditors that do not require specific approval by the Audit
Committee will be submitted to the Fund's Chief Financial Officer and must
include a detailed description of the services to be rendered. The Fund's Chief
Financial Officer will determine whether such services are included within the
list of services that have received the general pre-approval of the Audit
Committee. The Audit Committee will be informed on a timely basis of any such
services rendered by the Independent Auditors. Requests or applications to
provide services that require specific approval by the Audit Committee will be
submitted to the Audit Committee by both the Independent Auditors and the Fund's
Chief Financial Officer, and must include a joint statement as to whether, in
their view, the request or application is consistent with the SEC's rules on
auditor independence.
The Audit Committee has designated the Fund's Chief Financial Officer
to monitor the performance of all services provided by the Independent Auditors
and to determine whether such services are in compliance with this Policy. The
Fund's Chief Financial Officer will report to the Audit Committee on a periodic
basis on the results of its monitoring. A sample report is included as Appendix
B.7. Both the Fund's Chief Financial Officer and management will immediately
report to the chairman of the Audit Committee any breach of this Policy that
comes to the attention of the Fund's Chief Financial Officer or any member of
management.
9. ADDITIONAL REQUIREMENTS
The Audit Committee has determined to take additional measures on an
annual basis to meet its responsibility to oversee the work of the Independent
Auditors and to assure the auditor's independence from the Fund, such as
reviewing a formal written statement from the Independent Auditors delineating
all relationships between the Independent Auditors and the Fund, consistent with
Independence Standards Board No. 1, and discussing with the Independent Auditors
its methods and procedures for ensuring independence.
10. COVERED ENTITIES
Covered Entities include the Fund's investment adviser(s) and any
entity controlling, controlled by or under common control with the Fund's
investment adviser(s) that provides ongoing services to the Fund(s). Beginning
with non-audit service contracts entered into on or after May 6, 2003, the
Fund's audit committee must pre-approve non-audit services provided not only to
the Fund but also to the Covered Entities if the engagements relate directly to
the operations and financial reporting of the Fund. This list of Covered
Entities would include:
- Van Kampen Investments Inc.
- Van Kampen Asset Management
- Van Kampen Advisors Inc.
- Van Kampen Funds Inc.
- Van Kampen Investor Services Inc.
- Morgan Stanley Investment Management Inc.
- Morgan Stanley Trust Company
- Morgan Stanley Investment Management Ltd.
- Morgan Stanley Investment Management Company
- Morgan Stanley Asset & Investment Trust Management Company
Ltd.
(e)(2) Beginning with non-audit service contracts entered into on or after May
6, 2003, the audit committee also is required to pre-approve services to Covered
Entities to the extent that the services
are determined to have a direct impact on the operations or financial reporting
of the Registrant. 100% of such services were pre-approved by the audit
committee pursuant to the Audit Committee's pre-approval policies and procedures
(included herein).
(f) Not applicable.
(g) See table above.
(h) The audit committee of the Board of Trustees has considered whether the
provision of services other than audit services performed by the auditors to the
Registrant and Covered Entities is compatible with maintaining the auditors'
independence in performing audit services.
Item 5. Audit Committee of Listed Registrants.
(a) The Trust has a separately-designated standing audit committee established
in accordance with Section 3(a)(58)(A) of the Exchange Act whose members are:
Craig Kennedy, Jerry Choate and Rod Dammeyer.
(b) Not applicable.
Item 6. Schedule of Investments.
Please refer to Item #1.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies.
The Trust invests in exclusively non-voting securities and therefore this item
is not applicable to the Trust.
Item 8. Purchase of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers.
Not Applicable.
Item 9. Submission of Matters to a Vote of Security Holders.
Not Applicable.
Item 10. Controls and Procedures
(a) The Trust's principal executive officer and principal financial officer have
concluded that the Trust's disclosure controls and procedures are sufficient to
ensure that information required to be disclosed by the Trust in this Form N-CSR
was recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission's rules and forms, based
upon such officers' evaluation of these controls and procedures as of a date
within 90 days of the filing date of the report.
(b) There were no changes in the registrant's internal control over financial
reporting that occurred during the registrant's most recent fiscal half-year
(the registrant's second fiscal half-year in the case of an annual report) that
has materially affected, or is reasonably likely to materially affect, the
registrant's internal control over financial reporting.
Item 11. Exhibits.
(a) The Code of Ethics for Principal Executive and Senior Financial Officers is
attached hereto.
(b)(1) A certification for the Principal Executive Officer of the registrant is
attached hereto as part of EX-99.CERT.
(b)(2) A certification for the Principal Financial Officer of the registrant is
attached hereto as part of EX-99.CERT.
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) Van Kampen Municipal Trust
By: /s/ Ronald E. Robison
---------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: December 14, 2004
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed by the following
persons on behalf of the registrant and in the capacities and on the dates
indicated.
By: /s/ Ronald E. Robison
---------------------
Name: Ronald E. Robison
Title: Principal Executive Officer
Date: December 14, 2004
By: /s/ James M. Dykas
------------------
Name: James M. Dykas
Title: Principal Financial Officer
Date: December 14, 2004