Annual Report June 30, 2002
NUVEEN
MUNICIPAL CLOSED-END
EXCHANGE-TRADED
FUNDS
NEW JERSEY
NQJ
NNJ
NXJ
NUJ
PENNSYLVANIA
NQP
NPY
NXM
NVY
[photo of: woman and child on bikes]
[photo of: 2 women and child]
Dependable,
tax-free income
because
it's not what you earn,
it's what you keep.(R)
THE NUVEEN
INVESTOR
See Page 13
Logo: NUVEEN Investments
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IF YOUR NUVEEN FUND
DIVIDENDS AND STATEMENTS
COME DIRECTLY TO
YOU FROM NUVEEN,
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Photo of: Timothy R. Schwertfeger
Chairman of the Board
Sidebar text: "I urge you to consider receiving future Fund reports and other
information electronically ...see the inside front cover of this report for
detailed instructions."
Dear Shareholder
I am pleased to report that during the period covered by this report, your Fund
continued to seek to meet its primary objective of providing attractive monthly
income, while at the same time offering opportunities to reduce overall
portfolio volatility. Detailed information on your Fund's performance can be
found in the Portfolio Managers' Comments and Performance Overview sections of
this report. I urge you to take the time to read them.
I also urge you to consider receiving future Fund reports and other information
electronically via the Internet and e-mail rather than in hard copy. Not only
will you be able to receive the information faster, but this also may help lower
Fund expenses. Sign up is quick and easy - see the inside front cover of this
report for detailed instructions.
In addition to providing you with tax-free income, your Nuveen Fund also
features several characteristics that can help make it an essential part of your
overall investment strategy. These include careful research, constant
surveillance and judicious trading by Nuveen's seasoned portfolio management
team, with every action designed to supplement income, improve Fund structure,
better adapt to current market conditions or increase diversification. In
uncertain markets like these, prudent investors understand the importance of
diversification, balance, and risk management, all attributes your Nuveen Fund
can bring to your portfolio.
For more than 100 years, Nuveen has specialized in offering quality investments
such as these Nuveen Funds to those seeking to accumulate and preserve wealth.
Our mission continues to be to assist you and your financial advisor by offering
the investment services and products that can help you meet your financial
objectives. We thank you for continuing to choose Nuveen Investments as a
partner as you work toward that goal.
Sincerely,
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
August 15, 2002
1
Nuveen New Jersey and Pennsylvania Municipal Closed-End Exchange-Traded Funds
(NQJ, NNJ, NXJ, NUJ, NQP, NPY, NXM, NVY)
Portfolio Managers' Comments
Portfolio managers Tom Spalding and Tom O'Shaughnessy review economic and market
conditions, key strategies, and recent Fund performance. A 25-year veteran of
Nuveen, Tom Spalding assumed portfolio management responsibility for NQJ, NNJ
and NXJ in March 2001, and for NUJ upon its inception in 2002. Tom
O'Shaughnessy, who has been with Nuveen since 1983, has managed NQP since 1991,
NPY since 1995, NXM since its inception in 2001 and NVY since its inception in
2002.
WHAT FACTORS HAD THE GREATEST INFLUENCE ON THE U.S. ECONOMY AND THE MUNICIPAL
MARKET DURING THIS REPORTING PERIOD?
The two major forces at work during the twelve months ended June 30, 2002, were
the general slowdown in economic growth and the Federal Reserve's aggressive
easing of short-term interest rates. In addition, the events of September 11,
2001, and the uncertain geopolitical climate that followed also impacted the
economy and the markets.
In the municipal markets, the generally sluggish economic environment of the
past twelve months helped many bonds perform well. In addition, the trend toward
increased issuance remained strong. Looking at the first six months of 2002,
Pennsylvania had an 18.9% growth in new issue supply when compared with the same
period in 2001. New Jersey issuance also increased relative to 2001. On the
demand side, municipal bonds continued to be highly sought after by individual
investors looking for diversification, tax-free income and an alternative to a
volatile stock market. Institutional investors, especially traditional
purchasers such as property/ casualty insurance companies, also have been active
buyers.
HOW WAS THE ECONOMIC AND MARKET ENVIRONMENT IN NEW JERSEY AND PENNSYLVANIA?
During the first half of 2002, New Jersey's economy matched the sluggish
national picture. Overall, the state saw its unemployment number rise to 5.6% in
June 2002 from 4.2% one year earlier. Many expect the New Jersey economy to
begin a recovery in the last half of 2002, but some suggest that collection of
income and sales taxes may continue to slow, and the state may experience a
budget deficit for an indefinite period. While most observers like the state's
longer term prospects, New Jersey's credit quality rating was lowered recently
by Standard & Poor's to AA- from AA+.
Pennsylvania also has seen a slowdown in economic activity over the past year.
Unemployment had reached 5.3% in June 2002, compared with 4.7% in 2001. Reduced
manufacturing activity has had an impact on the retail and service sectors.
While Pennsylvania's highly skilled workforce represents a strong base for
future growth, aging demographics and a relatively low concentration of
high-growth industries could limit Pennsylvania's prospects in the intermediate
term.
HOW DID THE NUVEEN FUNDS FOR NEW JERSEY AND PENNSYLVANIA PERFORM OVER THE PAST
TWELVE MONTHS?
For the fiscal year ended June 30, 2002, the four older Nuveen Closed-End
Exchange-Traded Funds covered in this report produced total annual returns on
Common share net asset value (NAV) as shown in the accompanying table. The
annual returns for the Lehman Brothers Municipal Bond Index1 and relevant Lipper
Peer Groups2 are also presented.
TOTAL RETURN LEHMAN LIPPER
MARKET YIELD ON NAV TOTAL RETURN1 AVERAGE2
-----------------------------------------------------------------
1 YEAR 1 YEAR 1 YEAR
TAXABLE- ENDED ENDED ENDED
6/30/02 EQUIVALENT3 6/30/02 6/30/02 6/30/02
-----------------------------------------------------------------
NQJ 6.03% 9.21% 6.56% 6.92% 7.80%
-----------------------------------------------------------------
NNJ 5.65% 8.63% 7.91% 6.92% 7.80%
-----------------------------------------------------------------
NXJ 6.03% 9.21% 6.05% 6.92% 7.80%
-----------------------------------------------------------------
NUJ 6.10% 9.31% -- -- --
-----------------------------------------------------------------
NQP 6.01% 8.84% 7.34% 6.92% 8.60%
-----------------------------------------------------------------
NPY 6.13% 9.01% 8.88% 6.92% 8.60%
-----------------------------------------------------------------
NXM 5.92% 8.71% 9.67% 6.92% 8.60%
-----------------------------------------------------------------
NVY 6.23% 9.16% -- -- --
-----------------------------------------------------------------
Past performance is not predictive of future results.
For additional information, see the individual Performance Overview for your
Fund in this report.
1 The Funds' performances are compared with that of the Lehman Brothers
Municipal Bond Index, a national unleveraged index comprising a broad range of
investment-grade municipal bonds. Results for the Lehman index do not reflect
any expenses.
2 The total returns of the New Jersey Funds are compared with the average
annualized return of the nine funds in the Lipper New Jersey Municipal Debt
Funds category, while the total returns of Pennsylvania Funds are compared
with the average annualized return of the ten funds in the Lipper Pennsylvania
Municipal Debt Funds category. Fund and Lipper returns assume reinvestment of
dividends.
3 The taxable-equivalent yield represents the yield that must be earned on a
taxable investment in order to equal the yield of the Nuveen Fund on an
after-tax basis. The taxable-equivalent yield is based on the Fund's market
yield on the indicated date and a federal income tax rate of 30% plus the
applicable state income tax rate. The combined federal and state tax rates
used in this report are as follows: New Jersey 34.5% and Pennsylvania 32%.
2
Over the past twelve months, the Fed's policy to keep short-term interest rates
relatively low, combined with generally favorable market conditions, created a
positive total return environment for municipal bonds. This is reflected in the
total returns on NAV listed in the previous table.
HOW DID THE MARKET ENVIRONMENT AFFECT THE FUNDS' DIVIDENDS AND SHARE PRICES?
With the Fed keeping short-term interest rates relatively low, the
dividend-paying capabilities of these Funds benefited from their use of
leverage, a strategy that can potentially enhance the dividends paid to common
shareholders. This benefit is tied in part to the short-term rates the Funds pay
their MuniPreferred(R) shareholders. For example, low short-term rates can
enable the Funds to reduce the amount of income they pay preferred shareholders,
which can leave more earnings to support common share dividends.
During the fiscal year ended June 30, 2002, relatively low short-term interest
rates enabled us to implement three dividend increases in NNJ, and to maintain
the attractive monthly dividends in the other New Jersey Funds. Similarly, NPY
had four dividend increases during the year, NXM had one, and the other two
Pennsylvania Funds maintained their dividends. In coming months, the lower rates
currently offered by municipal securities with shorter maturities may continue
to benefit these Funds by keeping the amount paid to MuniPreferred shareholders
relatively low. However, this could be offset to some degree by the effect of
bond calls on higher-yielding securities, especially if refundings increase as
the result of lower rates. The level of short-term rates, the number of bond
calls, and the interest rates at which we can reinvest the proceeds of any calls
will all influence the dividends of these Funds over the next twelve months.
Over the past year, as the markets remained volatile, the share prices of the
New Jersey and Pennsylvania Funds all stayed relatively stable (see the charts
on the individual Performance Overview pages). As of June 30, 2002, the share
prices of four of these Funds were at slight premiums to their Common share net
asset values and four were at slight discounts.
NUJ and NVY were both introduced in March 2002. Since then, they have each
declared their first regular monthly dividend and each has traded well in the
secondary market.
WHAT KEY STRATEGIES WERE USED TO MANAGE THESE FUNDS DURING THE FISCAL YEAR ENDED
JUNE 30, 2002?
During this reporting period, we focused on two principal areas: enhancing the
dividend-paying capabilities of the Funds and improving their diversification
and call protection. With new issuance abundant, we looked for opportunities and
tried to respond quickly when favorable situations developed.
Looking specifically at the New Jersey Funds, we found several attractive
opportunities in the housing and healthcare sectors, as well as with certain
insured general obligation bonds. Most of the immediate call exposure in these
Funds has been eliminated, either by selling callable bonds or redeploying
assets from called bonds in other securities. The initial investing period for
NUJ was completed during the reporting period, and we believe that Fund is well
positioned to provide attractive dividends for shareholders in the months ahead.
The New Jersey Funds have some exposure to bonds issued by the Port Authority of
New York and New Jersey, the owner of the World Trade Center. Many of these
holdings were insured and, in general, have not impacted the Funds' performance.
The Port Authority's financial strength and the diverse scope of its operations
are helping to ease the financial burden precipitated by September 11.
3
In Pennsylvania, we took advantage of increased issuance in the state's
municipal market to sell some bonds approaching call dates and reinvested the
proceeds in credits that we believe improved the structure and diversification
of the Funds. The ample supply of Pennsylvania bonds also ensured that we were
able to complete the initial investing process for NVY. Overall, our focus was
on the healthcare and housing sectors - two areas that we believed offered good
values. There is a good deal of demand from individual investors for
Pennsylvania municipal bonds, and in some instances we were able to take
advantage of this by selling bonds at very favorable prices and investing the
proceeds in other bonds that enhanced yield or improved structure.
We also were keeping a close eye on the duration4 of each Fund, to help make
sure we retained the ability to move quickly in the event of an anticipated
major shift in interest rates. We believe that in this market environment it is
beneficial to maintain slightly shorter durations, which we think will help make
the portfolios less sensitive to possible interest rate changes while still
providing yields and returns that are competitive with longer duration funds.
In the current geopolitical climate, we believe that maintaining strong credit
quality is a key requirement for all the Funds. All of the New Jersey and
Pennsylvania Funds continue to offer excellent credit quality, with allocations
of bonds rated AAA/U.S. guaranteed and AA ranging from 60% to 90% as of June 30,
2002. All of the Funds also had a portion of their assets invested in BBB and/or
non-rated bonds, which can serve to enhance the Funds' income streams.
WHAT IS YOUR OUTLOOK FOR THE MUNICIPAL MARKET IN GENERAL AND THESE NUVEEN FUNDS
IN PARTICULAR?
In general, our outlook for the fixed-income markets over the next twelve months
remains positive. We believe the U.S. economy is headed for recovery, but one
that may take longer and see a slower pace of growth than some are now
predicting. We believe inflation and interest rates should remain relatively low
over the near term, and that new municipal issuance should continue to be
strong. We anticipate the demand for tax-exempt municipal bonds will remain firm
as investors look for ways to rebalance their portfolios and reduce risk.
We plan to remain focused on strategies that add value for our shareholders,
provide support for the Funds' dividends, and fully utilize Nuveen's experience
and research expertise. As noted, shareholders may see these Funds' durations
shorten modestly in the months ahead.
None of these Funds are facing an excessive amount of call exposure over the
next 18-24 months. We expect we will be able to readily reinvest proceeds from
calls that do occur in bonds that will help maintain strong credit quality and
adequate diversification, as well as enhance overall Fund structure and
strengthen future dividend paying capabilities.
Overall, we believe these Funds can continue to play an important role in
investors' long-range financial programs, providing balance and diversification,
dependable tax-free income, and a measure of stability in uncertain times. We
believe the Funds currently are well positioned for the market environment
ahead, and we will continue to closely monitor and respond to events as
appropriate.
4 Duration is a measure of a fund's NAV volatility in reaction to interest rate
movements. Fund duration, also known as leverage-adjusted duration, takes into
account the leveraging process for a Fund and therefore is generally longer
than the duration of the actual portfolio of individual bonds that make up the
Fund. Unless otherwise noted, references to duration in this commentary are
intended to indicate Fund duration.
4
Nuveen New Jersey Investment Quality Municipal Fund, Inc.
Performance
Overview As of June 30, 2002
NQJ
Pie Chart:
AAA/U.S. Guaranteed 73%
AA 10%
A 5%
BBB 6%
NR 3%
Other 3%
PORTFOLIO STATISTICS
------------------------------------------------------
Share Price $15.22
------------------------------------------------------
Common Share Net Asset Value $15.07
------------------------------------------------------
Market Yield 6.03%
------------------------------------------------------
Taxable-Equivalent Yield
(Federal Income Tax Rate)1 8.61%
------------------------------------------------------
Taxable-Equivalent Yield
(Federal and State Income Tax Rate)1 9.21%
------------------------------------------------------
Net Assets Applicable to
Common Shares ($000) $304,808
------------------------------------------------------
Average Effective Maturity (Years) 20.48
------------------------------------------------------
Leverage-Adjusted Duration 9.14
------------------------------------------------------
ANNUALIZED TOTAL RETURN (Inception 2/91)
------------------------------------------------------
ON SHARE PRICE ON NAV
------------------------------------------------------
1-Year 4.19% 6.56%
------------------------------------------------------
5-Year 4.76% 5.96%
------------------------------------------------------
10-Year 6.36% 6.83%
------------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
------------------------------------------------------
Transportation 25%
------------------------------------------------------
Healthcare 12%
------------------------------------------------------
Tax Obligation/Limited 9%
------------------------------------------------------
Tax Obligation/General 9%
------------------------------------------------------
Housing/Single Family 8%
------------------------------------------------------
[bar chart data]:
2001-2002 Monthly Tax-Free Dividends Per Share
Jul $0.0765
Aug 0.0765
Sep 0.0765
Oct 0.0765
Nov 0.0765
Dec 0.0765
Jan 0.0765
Feb 0.0765
Mar 0.0765
Apr 0.0765
May 0.0765
Jun 0.0765
[line chart data]:
Share Price Performance
Weekly Closing Price
7/1/01 $15.58
15.55
15.53
15.38
15.55
15.84
15.71
15.9
16
16
15.97
15.24
15.94
15.9
15.72
15.77
15.82
16
15.94
15.77
15.75
15.82
15.35
15.38
15.09
15.24
15.45
15.5
15.8
15.6
15.8
15.81
15.73
15.75
15.93
15.5
15.27
14.7
14.65
14.79
14.77
14.6
14.88
15.29
15.25
15.01
15.25
15.33
15.5
15.35
15.36
6/30/02 15.22
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is
calculated using the current market yield and a federal income tax rate of
30%. The rate shown for federal and state highlights the added value of owning
shares that are also exempt from state income taxes. It is based on a combined
federal and state income tax rate of 34.5%.
5
Nuveen New Jersey Premium Income Municipal Fund, Inc.
Performance
Overview As of June 30, 2002
NNJ
Pie Chart:
AAA/U.S. Guaranteed 72%
AA 10%
A 13%
BBB 1%
NR 3%
Other 1%
PORTFOLIO STATISTICS
-------------------------------------------------------
Share Price $15.50
-------------------------------------------------------
Common Share Net Asset Value $15.60
-------------------------------------------------------
Market Yield 5.65%
-------------------------------------------------------
Taxable-Equivalent Yield
(Federal Income Tax Rate)1 8.07%
-------------------------------------------------------
Taxable-Equivalent Yield
(Federal and State Income Tax Rate)1 8.63%
-------------------------------------------------------
Net Assets Applicable to
Common Shares ($000) $187,393
-------------------------------------------------------
Average Effective Maturity (Years) 15.68
-------------------------------------------------------
Leverage-Adjusted Duration 8.40
-------------------------------------------------------
ANNUALIZED TOTAL RETURN (Inception 12/92)
-------------------------------------------------------
ON SHARE PRICE ON NAV
-------------------------------------------------------
1-Year 7.88% 7.91%
-------------------------------------------------------
5-Year 6.80% 7.05%
-------------------------------------------------------
Since Inception 6.23% 6.88%
-------------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
-------------------------------------------------------
Transportation 24%
-------------------------------------------------------
Tax Obligation/Limited 14%
-------------------------------------------------------
Water and Sewer 12%
-------------------------------------------------------
Education and Civic Organizations 11%
-------------------------------------------------------
U.S. Guaranteed 8%
-------------------------------------------------------
[bar chart data]:
2001-2002 Monthly Tax-Free Dividends Per Share
Jul $0.0695
Aug 0.0695
Sep 0.0695
Oct 0.0695
Nov 0.0695
Dec 0.0705
Jan 0.0705
Feb 0.0705
Mar 0.072
Apr 0.072
May 0.072
Jun 0.073
[line chart data]:
Share Price Performance
Weekly Closing Price
7/1/01 $15.26
15.05
15.11
14.92
15.13
15.38
15.48
15.47
15.49
15.45
15.45
14.69
15.42
15.3
15.22
15
15.25
15.45
15.69
15.17
15.09
15.5
15.14
14.84
14.79
14.84
14.94
15.2
15.25
15.15
15.23
15.37
15.15
15.17
15.34
15.19
14.95
14.5
14.32
14.59
14.65
14.5
14.61
14.97
15.19
14.7
14.91
15.25
15.23
15.31
15.3
6/30/02 15.5
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is
calculated using the current market yield and a federal income tax rate of
30%. The rate shown for federal and state highlights the added value of owning
shares that are also exempt from state income taxes. It is based on a combined
federal and state income tax rate of 34.5%.
6
Nuveen New Jersey Dividend Advantage Municipal Fund
Performance
Overview As of June 30, 2002
NXJ
Pie Chart:
AAA/U.S. Guaranteed 63%
AA 8%
A 17%
BBB 4%
Other 8%
PORTFOLIO STATISTICS
-------------------------------------------------------
Share Price $14.12
-------------------------------------------------------
Common Share Net Asset Value $14.38
-------------------------------------------------------
Market Yield 6.03%
-------------------------------------------------------
Taxable-Equivalent Yield
(Federal Income Tax Rate)1 8.61%
-------------------------------------------------------
Taxable-Equivalent Yield
(Federal and State Income Tax Rate)1 9.21%
-------------------------------------------------------
Net Assets Applicable to
Common Shares ($000) $94,130
-------------------------------------------------------
Average Effective Maturity (Years) 25.41
-------------------------------------------------------
Leverage-Adjusted Duration 12.83
-------------------------------------------------------
ANNUALIZED TOTAL RETURN (Inception 3/01)
-------------------------------------------------------
ON SHARE PRICE ON NAV
-------------------------------------------------------
1-Year -0.17% 6.05%
-------------------------------------------------------
Since Inception 0.56% 5.95%
-------------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
-------------------------------------------------------
Healthcare 22%
-------------------------------------------------------
Water and Sewer 18%
-------------------------------------------------------
Transportation 17%
-------------------------------------------------------
Tax Obligation/General 13%
-------------------------------------------------------
Education and Civic Organizations 12%
-------------------------------------------------------
[bar chart data]:
2001-2002 Monthly Tax-Free Dividends Per Share
Jul $0.071
Aug 0.071
Sep 0.071
Oct 0.071
Nov 0.071
Dec 0.071
Jan 0.071
Feb 0.071
Mar 0.071
Apr 0.071
May 0.071
Jun 0.071
[line chart data]:
Share Price Performance
Weekly Closing Price
7/1/01 $15.07
14.98
14.95
14.93
14.98
15.06
15.03
15.08
15.1
15.03
14.96
14.79
14.93
15.03
14.8
15.04
14.98
15.1
15.2
15
15.1
15.06
15.02
14.99
14.81
14.75
14.52
14.75
14.71
14.75
14.77
14.65
14.5
14.78
14.68
14.38
13.99
13.36
13.64
13.7
14
13.99
13.87
14.24
14.12
14.16
14.2
14.31
14.72
14.7
14.5
6/30/02 14.12
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is
calculated using the current market yield and a federal income tax rate of
30%. The rate shown for federal and state highlights the added value of owning
shares that are also exempt from state income taxes. It is based on a combined
federal and state income tax rate of 34.5%.
7
Nuveen New Jersey Dividend Advantage Municipal Fund 2
Performance
Overview As of June 30, 2002
NUJ
Pie Chart:
AAA/U.S. Guaranteed 55%
AA 5%
A 19%
BBB 16%
Other 5%
PORTFOLIO STATISTICS
--------------------------------------------------------
Share Price $15.04
--------------------------------------------------------
Common Share Net Asset Value $14.46
--------------------------------------------------------
Market Yield 6.10%
--------------------------------------------------------
Taxable-Equivalent Yield
(Federal Income Tax Rate)1 8.71%
--------------------------------------------------------
Taxable-Equivalent Yield
(Federal and State Income Tax Rate)1 9.31%
--------------------------------------------------------
Net Assets Applicable to
Common Shares ($000) $65,153
--------------------------------------------------------
Average Effective Maturity (Years) 24.25
--------------------------------------------------------
Leverage-Adjusted Duration 16.01
--------------------------------------------------------
CUMULATIVE TOTAL RETURN (Inception 3/02)
--------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------
Since Inception 1.29% 1.98%
--------------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
--------------------------------------------------------
Transportation 26%
--------------------------------------------------------
Healthcare 18%
--------------------------------------------------------
Education and Civic Organizations 14%
--------------------------------------------------------
Tax Obligation/Limited 8%
--------------------------------------------------------
Utilities 8%
--------------------------------------------------------
[bar chart data]:
2001-2002 Monthly Tax-Free Dividends Per Share
May $0.0765
Jun 0.0765
[line chart data]:
Share Price Performance
Weekly Closing Price
3/28/02 $15.35
15.09
15
15.02
15.1
15.06
15.12
15.02
15.1
15.2
15.28
15.5
15.35
6/30/02 15.04
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is
calculated using the current market yield and a federal income tax rate of
30%. The rate shown for federal and state highlights the added value of owning
shares that are also exempt from state income taxes. It is based on a combined
federal and state income tax rate of 34.5%.
8
Nuveen Pennsylvania Investment Quality Municipal Fund
Performance
Overview As of June 30, 2002
NQP
Pie Chart:
AAA/U.S. Guaranteed 70%
AA 20%
A 7%
BBB 3%
PORTFOLIO STATISTICS
------------------------------------------------------
Share Price $15.18
------------------------------------------------------
Common Share Net Asset Value $14.70
------------------------------------------------------
Market Yield 6.01%
------------------------------------------------------
Taxable-Equivalent Yield
(Federal Income Tax Rate)1 8.59%
------------------------------------------------------
Taxable-Equivalent Yield
(Federal and State Income Tax Rate)1 8.84%
------------------------------------------------------
Net Assets Applicable to
Common Shares ($000) $238,926
------------------------------------------------------
Average Effective Maturity (Years) 22.50
------------------------------------------------------
Leverage-Adjusted Duration 15.63
------------------------------------------------------
ANNUALIZED TOTAL RETURN (Inception 2/91)
------------------------------------------------------
ON SHARE PRICE ON NAV
------------------------------------------------------
1-Year 6.57% 7.34%
------------------------------------------------------
5-Year 4.28% 5.07%
------------------------------------------------------
10-Year 6.33% 6.63%
------------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
------------------------------------------------------
Tax Obligation/General 21%
------------------------------------------------------
Water and Sewer 15%
------------------------------------------------------
Tax Obligation/Limited 15%
------------------------------------------------------
Education and Civic Organizations 14%
------------------------------------------------------
Housing/Single Family 8%
------------------------------------------------------
[bar chart data]:
2001-2002 Monthly Tax-Free Dividends Per Share
Jul $0.076
Aug 0.076
Sep 0.076
Oct 0.076
Nov 0.076
Dec 0.076
Jan 0.076
Feb 0.076
Mar 0.076
Apr 0.076
May 0.076
Jun 0.076
[line chart data]:
Share Price Performance
Weekly Closing Price
7/1/01 $15.21
15.27
15.27
15.3
15.28
15.69
15.71
15.55
15.95
16.1
16.04
14.66
15.1
15.8
15.4
15.51
15.6
15.62
15.74
15.47
15.38
15.3
15.25
14.8
14.47
14.9
14.95
15.19
15.35
15.58
15.52
15.78
15.53
15.55
15.71
15.56
15.12
14.28
14.16
14.2
14.33
14.46
14.56
14.77
14.75
14.73
14.8
14.82
14.8
15
14.95
6/30/02 15.18
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is
calculated using the current market yield and a federal income tax rate of
30%. The rate shown for federal and state highlights the added value of owning
shares that are also exempt from state income taxes. It is based on a combined
federal and state income tax rate of 32%.
9
Nuveen Pennsylvania Premium Income Municipal Fund 2
Performance
Overview As of June 30, 2002
NPY
Pie Chart:
AAA/U.S. Guaranteed 74%
AA 9%
A 6%
BBB 7%
NR 3%
Other 1%
PORTFOLIO STATISTICS
-------------------------------------------------------
Share Price $14.79
-------------------------------------------------------
Common Share Net Asset Value $14.83
-------------------------------------------------------
Market Yield 6.13%
-------------------------------------------------------
Taxable-Equivalent Yield
(Federal Income Tax Rate)1 8.76%
-------------------------------------------------------
Taxable-Equivalent Yield
(Federal and State Income Tax Rate)1 9.01%
-------------------------------------------------------
Net Assets Applicable to
Common Shares ($000) $233,536
-------------------------------------------------------
Average Effective Maturity (Years) 17.85
-------------------------------------------------------
Leverage-Adjusted Duration 9.44
-------------------------------------------------------
ANNUALIZED TOTAL RETURN (Inception 3/93)
-------------------------------------------------------
ON SHARE PRICE ON NAV
-------------------------------------------------------
1-Year 13.25% 8.88%
-------------------------------------------------------
5-Year 8.26% 6.66%
-------------------------------------------------------
Since Inception 5.92% 6.35%
-------------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
-------------------------------------------------------
U.S. Guaranteed 15%
-------------------------------------------------------
Utilities 12%
-------------------------------------------------------
Water and Sewer 12%
-------------------------------------------------------
Healthcare 11%
-------------------------------------------------------
Education and Civic Organizations 9%
-------------------------------------------------------
[bar chart data]:
2001-2002 Monthly Tax-Free Dividends Per Share
Jul $0.0685
Aug 0.0685
Sep 0.0705
Oct 0.0705
Nov 0.0705
Dec 0.0725
Jan 0.0725
Feb 0.0725
Mar 0.074
Apr 0.074
May 0.074
Jun 0.0755
[line chart data]:
Share Price Performance
Weekly Closing Price
7/1/01 $13.95
13.83
13.85
13.74
13.88
14.18
14.1
14.22
14.14
14.45
14.65
13.65
14.25
14.65
14.52
14.39
14.47
14.36
14.7
14.44
14.25
14.11
14.07
13.9
13.85
13.93
14.13
14.35
14.62
14.67
14.61
14.73
14.49
14.56
14.47
14.3
14.26
13.91
13.92
13.92
13.96
13.99
14.29
14.3
14.34
14.25
14.38
14.74
14.81
14.75
14.64
6/30/02 14.79
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is
calculated using the current market yield and a federal income tax rate of
30%. The rate shown for federal and state highlights the added value of owning
shares that are also exempt from state income taxes. It is based on a combined
federal and state income tax rate of 32%.
10
Nuveen Pennsylvania Dividend Advantage Municipal Fund
Performance
Overview As of June 30, 2002
NXM
Pie Chart:
AAA/U.S. Guaranteed 57%
AA 19%
A 10%
BBB 11%
NR 3%
PORTFOLIO STATISTICS
----------------------------------------------------------
Share Price $14.89
----------------------------------------------------------
Common Share Net Asset Value $14.96
----------------------------------------------------------
Market Yield 5.92%
----------------------------------------------------------
Taxable-Equivalent Yield
(Federal Income Tax Rate)1 8.46%
----------------------------------------------------------
Taxable-Equivalent Yield
(Federal and State Income Tax Rate)1 8.71%
----------------------------------------------------------
Net Assets Applicable to
Common Shares ($000) $49,306
----------------------------------------------------------
Average Effective Maturity (Years) 23.46
----------------------------------------------------------
Leverage-Adjusted Duration 14.87
----------------------------------------------------------
ANNUALIZED TOTAL RETURN (Inception 3/01)
----------------------------------------------------------
ON SHARE PRICE ON NAV
----------------------------------------------------------
1-Year 9.10% 9.67%
----------------------------------------------------------
Since Inception 5.07% 9.38%
----------------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
----------------------------------------------------------
Tax Obligation/General 30%
----------------------------------------------------------
Education and Civic Organizations 17%
----------------------------------------------------------
Healthcare 14%
----------------------------------------------------------
Tax Obligation/Limited 9%
----------------------------------------------------------
Long-Term Care 6%
----------------------------------------------------------
[bar chart data]:
2001-2002 Monthly Tax-Free Dividends Per Share
Jul $0.0725
Aug 0.0725
Sep 0.0725
Oct 0.0725
Nov 0.0725
Dec 0.0725
Jan 0.0725
Feb 0.0725
Mar 0.0735
Apr 0.0735
May 0.0735
Jun 0.0735
[line chart data]:
Share Price Performance
Weekly Closing Price
7/1/01 $14.71
14.87
14.9
14.75
14.93
15.23
15.01
15.08
15.1
15.08
15.08
14.55
14.5
14.92
14.9
14.65
14.72
15.05
15.5
14.99
15.12
15.34
15.22
14.89
14.55
14.82
14.9
14.77
14.9
14.97
14.98
15.06
15
14.85
15.08
14.75
14.64
14.15
14.45
13.98
13.83
13.95
14.08
14.45
14.4
14.5
14.78
15
14.82
14.95
14.89
6/30/02 14.89
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is
calculated using the current market yield and a federal income tax rate of
30%. The rate shown for federal and state highlights the added value of owning
shares that are also exempt from state income taxes. It is based on a combined
federal and state income tax rate of 32%.
2 The Fund also paid shareholders a capital gains distribution in December 2001
of $0.0126 per share.
11
Nuveen Pennsylvania Dividend Advantage Municipal Fund 2
Performance
Overview As of June 30, 2002
NVY
Pie Chart:
AAA/U.S. Guaranteed 59%
AA 28%
A 2%
BBB 11%
PORTFOLIO STATISTICS
--------------------------------------------------------
Share Price $14.74
--------------------------------------------------------
Common Share Net Asset Value $14.64
--------------------------------------------------------
Market Yield 6.23%
--------------------------------------------------------
Taxable-Equivalent Yield
(Federal Income Tax Rate)1 8.90%
--------------------------------------------------------
Taxable-Equivalent Yield
(Federal and State Income Tax Rate)1 9.16%
--------------------------------------------------------
Net Assets Applicable to
Common Shares ($000) $54,481
--------------------------------------------------------
Average Effective Maturity (Years) 20.77
--------------------------------------------------------
Leverage-Adjusted Duration 13.51
--------------------------------------------------------
CUMULATIVE TOTAL RETURN (Inception 3/02)
--------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------
Since Inception -0.73% 3.24%
--------------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
--------------------------------------------------------
Tax Obligation/General 37%
--------------------------------------------------------
Tax Obligation/Limited 25%
--------------------------------------------------------
Education and Civic Organizations 12%
--------------------------------------------------------
Healthcare 6%
--------------------------------------------------------
Water and Sewer 6%
--------------------------------------------------------
[bar chart data]:
2001-2002 Monthly Tax-Free Dividends Per Share
May $0.0765
Jun 0.0765
[line chart data]:
Share Price Performance
Weekly Closing Price
3/28/02 $15.1
15.02
15.1
15
15.01
15.09
15.25
15
15.22
15.24
15.38
15.15
15.05
6/30/02 14.74
Past performance is not predictive of future results.
1 Taxable-equivalent yield represents the yield on a taxable investment
necessary to equal the yield of the Nuveen Fund on an after-tax basis. It is
calculated using the current market yield and a federal income tax rate of
30%. The rate shown for federal and state highlights the added value of owning
shares that are also exempt from state income taxes. It is based on a combined
federal and state income tax rate of 32%.
12
THE NUVEEN
INVESTOR
VI
[photo of 2 boys walking]
BOND SURVEILLANCE -
A HIGH PRIORITY AT NUVEEN
The Enron scandal has raised numerous questions about the real value of American
securities. Investors want to know what safeguards are in place to inspire their
trust and ensure their holdings are dependable. The Nuveen Investor recently
spoke with David Blair, Assistant Vice President and Senior Analyst at Nuveen,
about the research and surveillance processes used for Nuveen funds.
HOW DO NUVEEN'S RESEARCH ANALYSTS EVALUATE BONDS PRIOR TO PURCHASE?
We evaluate factors impacting market sectors, issuers and specific bonds and
assign credit ratings to bonds we consider for purchase. We seek to purchase
bonds with stable and improving credit characteristics, which have attractive
prices and yields relative to other bonds in their sectors.
HOW DO YOU CONDUCT YOUR RESEARCH?
We conduct detailed analyses that often involve site visits and discussions with
managers of the projects being financed. Since Nuveen is a major investor with
large buying power, issuers and project managers are willing to listen to us and
respond to our concerns.
IS THE RESEARCH AND ANALYSIS PROCESS ANY DIFFERENT WHEN CONSIDERING HIGH-YIELD
BONDS?
Up to 20 percent of some funds can be invested in below investment grade bonds
to help the fund attain a higher yield. This underscores the need for research.
If one of our 16 analysts believes a high-yield bond should be purchased, a
second analyst reviews the issue as well.
HOW DO YOU MONITOR THE VARIOUS BONDS ONCE THEY'VE BEEN PURCHASED?
We have a proprietary database with information and analysis on the bonds Nuveen
holds in its funds. Among other things, we are able to evaluate risk exposure to
sectors, issuers and specific bonds on an on-going basis.
HOW DOES THE RESEARCH DEPARTMENT COMMUNICATE THE INFORMATION GATHERED?
We conduct biweekly meetings within the research department and weekly meetings
with portfolio managers. We also write-up our findings and distribute them with
"buy," "hold" or "sell" recommendations to portfolio managers.
(continued on page 15)
Volume one 2002
INSIDE
13 Bond Surveillance -
A High Priority at Nuveen
14 Is it Time to Rethink
Your Bond Strategy?
15 Many Investors Continue
to Find Solutions with Professional Advice
16 Fund Reports
Available Online
16 ETFConnect:
The Source for All Exchange-Traded Funds
(C)2002 Nuveen Investments.
All rights reserved.
[logo: NUVEEN Investments]
13
IS IT TIME TO RETHINK YOUR BOND STRATEGY?
Significant stock market losses in recent history have sent many investors
toward bonds as a way to potentially cut their losses and balance equity-
dominated portfolios. While many consider bonds a set-and-forget investment,
there are several circumstances that might prompt you to reassess -- and perhaps
revamp -- your bond holdings.
Tax bracket changes
The Economic Growth and Tax Relief Reconciliation Act of 2001 has dropped tax
brackets a percentage point this year, but a higher salary, large bonus, sale of
assets or retirement may push you into a higher tax bracket for 2002.
If you are in a higher tax bracket and want to generate an income stream without
raising your tax burden, tax-free municipal bonds may be a prudent option. Even
if you are in a lower tax bracket, municipal bonds could make sense. The
question is whether municipal or taxable bonds will deliver a better taxable
yield.
Retirement plans change
Whether you are near retirement or are currently enjoying it, you may want to
consider rebalancing your retirement accounts with less stock and more bonds, to
potentially reduce risk and try to preserve the assets that you have
accumulated. If you are just entering retirement you may want to make tax-free
municipal bonds a part of your portfolio to emphasize income generation and
protection from taxation.
Risk tolerance changes
The recent market volatility and market downturn may have caused many investors
to reevaluate their tolerance for risk. On the other hand, your portfolio might
have performed well over the last few years and you may not need to take on
extra risk to meet your long-term goals. In either situation you could take a
look at your bond portfolio and determine whether you need to make changes to
correspond with your tolerance for risk.
Portfolio changes
If you make significant changes to one or more of your investments, you'll want
to look at your portfolio as a whole, particularly with regard to overall asset
allocation. You may need to do some rebalancing to stay on track with your
investment strategy.
Your financial advisor can help. Regardless of how your circumstances change, he
or she can provide up-to-date information on the bond market and various funds
to help you decide how to maximize your returns consistent with your short- and
long-term financial goals.
No investment is risk free and some investments carry more risk than others. It
is important to know what the risks are, to evaluate them against any potential
rewards, and to determine your tolerance for risk when selecting an investment.
[photo of bridge to lighthouse]
[photo of toddlers playing]
The Nuveen Investor Vol 02.1
[logo: NUVEEN Investments]
14
[photo of partly-cloudy sky]
[photo of woman and young girl looking at photographs]
MANY INVESTORS CONTINUE
TO FIND SOLUTIONS WITH
PROFESSIONAL ADVICE
For many investors, current financial markets are confusing and frustrating.
According to research conducted for the Forum for Investor Advice*, that's the
number one reason many turn to a financial advisor. They want someone to suggest
ideas and provide consultation, dialogue and professional advice.
Investors say their advisors are helpful in other key ways, including...
o Saving time. After consultation, investors note that the second most
important reason for using an advisor is to have someone else monitor their
portfolio, reducing the amount of time they spend on investing.
o Help in sorting through information. Investors in the 21st century have more
products from which to choose than in the past. For example, there are
approximately 8,000 mutual funds today, up from 3,000 in 1990.
o Assistance in setting financial goals. According to investors who use a
financial advisor, they are more likely to have a plan for a specific
financial goal than do-it-yourself investors.
o Staying focused. Advisor-assisted investors are more likely than
do-it-yourself investors to have developed a comprehensive investment
program.
o Peace of mind. Investors say their comfort level in all types of markets is
higher when using an advisor for a "second opinion" on an investment
decision.
*The survey of 324 investors was conducted in December of 2000 by Market Facts
and analyzed by New York based Neuwirth Research. Of the 324, 166 said they had
an ongoing relationship with a financial advisor, while 157 described themselves
as do-it-yourselfers.
--------------------------------------------------------------------------------
(continued from page 13)
HOW ARE PROBLEM BONDS IDENTIFIED AND HANDLED?
We conduct surveillance on our bonds on a regular basis to ensure, among other
things, that deteriorating bonds are identified early. We then discuss any
emerging problems and potential courses of action with the portfolio manager.
HOW MANY ISSUES DOES THE RESEARCH DEPARTMENT FOLLOW?
We follow 12 sectors and 1,500 uninsured bonds, worth about $18 billion of
Nuveen's $45 billion in total municipal assets. The remaining $27 billion in
municipal assets are insured or escrowed (backed by Treasury bonds). For the
insured bonds, we monitor closely on a regular basis the insurers guaranteeing
the bonds.
Will research and surveillance change in light of problems with Enron
securities?
Overall, our investment process and surveillance have worked well and been
effective. However, we meet as a group on a regular basis and are constantly
evaluating ways to improve the process to respond to issues and the market
environment.
The Nuveen Investor Vol 02.1
[logo: NUVEEN Investments]
15
LOOK AHEAD...
FUND REPORTS
AVAILABLE
ONLINE
Nuveen Fund information is now available online. Once you register, you'll
receive an e-mail notice with a link to your Fund's reports and other
information just as soon as it is ready. Registering takes only a few minutes.
If you receive statements from a brokerage firm or financial advisor, go to
www.investordelivery.com. Enter your personal 13-character enrollment number
imprinted on the address sheet of this report near your name. From the options
on the follow-up page, select the New Enrollment-Create screen. Once there,
enter your e-mail address and a personal, four-digit PIN. Hit the Submit button.
Confirm the information you entered is correct, then hit Submit again.
[photo of investordelivery.com website]
If you receive statements directly from Nuveen, go to www.nuveen.com. Select the
Access Your Account tab, then select E-Report Enrollment. Finally, click on the
Enrollment Page. Once there, you'll need to provide your social security number
and e-mail address. Click on Enroll.
After registering, you should receive a confirming e-mail within 24 hours. If
not, repeat these steps to ensure all information is accurate. You can use this
same process if you need to change your registration information or want to
cancel Internet viewing. The e-mail address you provide is strictly confidential
and will only be used to notify you of shareholder information.
[photo of nuveen.com website]
The information in this newsletter should not be construed as specific tax or
investment advice. Contact your advisor for information about your particular
situation.
ETFCONNECT:
THE SOURCE FOR ALL
EXCHANGE-TRADED FUNDS
Last fall, Nuveen launched ETFConnect, the industry's first website
featuring all-encompassing information on exchanged-traded funds. Whatever
you're looking for in the world of Index ETFs or Closed-End Exchange-Traded
Funds - prices, NAVs, dividend information, performance histories, new
developments - this is the place. Highlights include Quick Facts sheets for more
than 500 funds, a multi-fund search capability, website links, a list of fund
sponsors, tools for portfolio tracking, and a continually updated education
center. Check out www.etfconnect.com.
[photo of etfconnect.com website]
The Nuveen Investor Vol 02.1
[logo: NUVEEN Investments]
16
Report of
Independent Auditors
THE BOARDS OF DIRECTORS, TRUSTEES AND SHAREHOLDERS
NUVEEN NEW JERSEY INVESTMENT QUALITY MUNICIPAL FUND, INC.
NUVEEN NEW JERSEY PREMIUM INCOME MUNICIPAL FUND, INC.
NUVEEN NEW JERSEY DIVIDEND ADVANTAGE MUNICIPAL FUND
NUVEEN NEW JERSEY DIVIDEND ADVANTAGE MUNICIPAL FUND 2
NUVEEN PENNSYLVANIA INVESTMENT QUALITY MUNICIPAL FUND
NUVEEN PENNSYLVANIA PREMIUM INCOME MUNICIPAL FUND 2
NUVEEN PENNSYLVANIA DIVIDEND ADVANTAGE MUNICIPAL FUND
NUVEEN PENNSYLVANIA DIVIDEND ADVANTAGE MUNICIPAL FUND 2
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Nuveen New Jersey Investment Quality Municipal
Fund, Inc., Nuveen New Jersey Premium Income Municipal Fund, Inc., Nuveen New
Jersey Dividend Advantage Municipal Fund, Nuveen New Jersey Dividend Advantage
Municipal Fund 2, Nuveen Pennsylvania Investment Quality Municipal Fund, Nuveen
Pennsylvania Premium Income Municipal Fund 2, Nuveen Pennsylvania Dividend
Advantage Municipal Fund and Nuveen Pennsylvania Dividend Advantage Municipal
Fund 2, as of June 30, 2002, and the related statements of operations, changes
in net assets and the financial highlights for the periods indicated therein.
These financial statements and financial highlights are the responsibility of
the Funds' management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the 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 and financial highlights. Our procedures included
confirmation of securities owned as of June 30, 2002, by correspondence with the
custodian and brokers or by other appropriate auditing procedures where replies
from brokers were not received. 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 positions of
Nuveen New Jersey Investment Quality Municipal Fund, Inc., Nuveen New Jersey
Premium Income Municipal Fund, Inc., Nuveen New Jersey Dividend Advantage
Municipal Fund, Nuveen New Jersey Dividend Advantage Municipal Fund 2, Nuveen
Pennsylvania Investment Quality Municipal Fund, Nuveen Pennsylvania Premium
Income Municipal Fund 2, Nuveen Pennsylvania Dividend Advantage Municipal Fund
and Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 at June 30, 2002,
and the results of their operations, changes in their net assets and their
financial highlights for the periods indicated therein in conformity with
accounting principles generally accepted in the United States.
/s/ Ernst & Young LLP
Chicago, Illinois
August 9, 2002
17
Nuveen New Jersey Investment Quality Municipal Fund, Inc. (NQJ)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
BASIC MATERIALS - 2.1%
$ 6,250 The Pollution Control Financing Authority of Salem County, New 11/02 at 101.00 AA- $ 6,382,500
Jersey, Waste Disposal Revenue Bonds (E.I. du Pont de Nemours
and Company - Chambers Works Project), 1991 Series A, 6.500%,
11/15/21 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 2.1%
6,220 The Children's Trust Fund, Puerto Rico, Tobacco Settlement Asset- 7/10 at 100.00 Aa3 6,353,917
Backed Bonds, Series 2000, 5.750%, 7/01/20
-----------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 11.5%
4,390 New Jersey Higher Education Student Assistance Authority, Student 6/10 at 101.00 AAA 4,760,384
Loan Revenue Bonds, 2000 Series A, 6.125%, 6/01/17
(Alternative Minimum Tax)
2,865 New Jersey Economic Development Authority, School Revenue Bonds 2/08 at 101.00 N/R 2,831,651
(Gill/St. Bernard School), Series 1998, 6.000%, 2/01/25
New Jersey Educational Facilities Authority, Revenue Bonds (Saint
Peter's College Issue), 1998 Series B:
1,000 5.375%, 7/01/18 7/08 at 102.00 BBB 1,009,060
1,750 5.500%, 7/01/27 7/08 at 102.00 BBB 1,744,803
1,250 New Jersey Educational Facilities Authority, Revenue Refunding 7/08 at 101.00 AAA 1,256,225
Bonds (Seton Hall University Project F), 1998 Series,
5.000%, 7/01/21
1,000 New Jersey Educational Facilities Authority, Revenue Bonds (Ramapo 7/11 at 100.00 AAA 993,180
College of New Jersey), Series 2001D, 5.000%, 7/01/31
New Jersey Educational Facilities Authority, Revenue Bonds (New
Jersey Institute of Technology), Series 2001G:
1,000 5.250%, 7/01/20 7/11 at 100.00 AAA 1,031,490
1,945 5.250%, 7/01/21 7/11 at 100.00 AAA 1,997,651
750 New Jersey Educational Facilities Authority, Revenue Refunding 7/12 at 100.00 AA 772,328
Bonds (Rider University), Series 2002A, 5.000%, 7/01/17
2,000 New Jersey Educational Facilities Authority, Revenue Bonds (New 7/12 at 100.00 AAA 1,984,620
Jersey City University), Series 2002A, 5.000%, 7/01/32
35 New Jersey Higher Education Assistance Authority, Senior Student 7/02 at 101.00 N/R 35,420
Loan Revenue Bonds, 1991 Series A, 7.200%, 7/01/09
(Alternative Minimum Tax)
5,730 New Jersey Higher Education Assistance Authority, Student Loan 6/07 at 102.00 AAA 6,061,538
Revenue Bonds (New Jersey Class Loan Program), Series 1997A,
5.800%, 6/01/16 (Alternative Minimum Tax)
4,235 Puerto Rico Industrial, Educational, Medical and Environmental 9/11 at 100.00 BBB 4,239,235
Control Facilities Financing Authority, Higher Education Revenue
Bonds (University of the Sacred Heart Project), Series 2001,
5.250%, 9/01/21
University of Medicine and Dentistry, New Jersey, Revenue Bonds,
Series 2002A:
2,000 5.000%, 12/01/24 12/12 at 100.00 AAA 2,000,720
4,000 5.500%, 12/01/27 12/12 at 100.00 AAA 4,190,920
-----------------------------------------------------------------------------------------------------------------------------
ENERGY - 2.7%
8,000 Pollution Control Financing Authority of Middlesex County, New 12/02 at 102.00 N/R 8,139,840
Jersey, Pollution Control Revenue Refunding Bonds (Amerada
Hess Corporation Project), Series 1992, 6.875%, 12/01/22
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 18.9%
1,500 New Jersey Healthcare Facilities Financing Authority, Revenue 7/07 at 102.00 BBB- 1,457,475
Refunding Bonds (Saint Elizabeth Hospital Obligated Group),
Series 1997, 6.000%, 7/01/27
2,070 New Jersey Healthcare Facilities Financing Authority, Revenue 7/02 at 101.00 AAA 2,135,205
Bonds (Robert Wood Johnson University Hospital), Series B,
6.625%, 7/01/16
18
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE (continued)
$ 4,350 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/02 at 101.00 AAA $ 4,410,813
(Mercer Medical Center Issue), Series 1991, 6.500%, 7/01/10
2,535 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/03 at 102.00 Baa2 2,584,965
(Deborah Heart and Lung Center Issue), Series 1993,
6.200%, 7/01/13
6,150 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 8/11 at 100.00 AAA 6,040,838
(Jersey City Medical Center Issue - FHA-Insured Mortgage),
Series 2001, 5.000%, 8/01/41
3,000 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/11 at 100.00 A3 3,020,100
(Kennedy Health System), Series 2001, 5.500%, 7/01/21
3,135 New Jersey Healthcare Facilities Financing Authority, Revenue 1/12 at 100.00 AA 3,127,821
Refunding Bonds (Bayshore Community Hospital), Series 2002,
5.125%, 7/01/32
7,400 New Jersey Healthcare Facilities Financing Authority, Revenue 7/12 at 100.00 Baa1 7,337,248
Bonds (South Jersey Hospital), Series 2002, 5.875%, 7/01/21
(DD, settling 7/01/02)
2,155 New Jersey Healthcare Facilities Financing Authority, Revenue No Opt. Call AAA 2,354,467
Bonds (Kennedy Health System Obligated Group), Series 1998B,
5.750%, 7/01/05
New Jersey Healthcare Facilities Financing Authority, Revenue Bonds
(Robert Wood Johnson University Hospital), Series 2000:
3,850 5.750%, 7/01/25 7/10 at 100.00 A+ 4,019,246
2,000 5.750%, 7/01/31 7/10 at 100.00 A+ 2,065,340
4,320 New Jersey Healthcare Facilities Financing Authority, Revenue 7/08 at 101.00 Aaa 4,311,619
Refunding Bonds (Saint Barnabas Medical Center - West Hudson
Hospital Obligated Group), Series 1998A, 5.000%, 7/01/23
5,040 New Jersey Healthcare Facilities Financing Authority, Revenue 7/10 at 100.00 AAA 5,148,461
Bonds (The Society of the Valley Obligated Group Issue), Series
2000, 5.375%, 7/01/31
2,000 New Jersey Healthcare Facilities Financing Authority, Revenue 7/10 at 100.00 BBB 2,119,100
Bonds (Saint Peter's University Hospital Issue), Series 2000A,
6.875%, 7/01/20
3,500 New Jersey Healthcare Facilities Financing Authority, Revenue 7/09 at 101.00 AAA 3,539,865
Bonds (Meridian Health System Obligated Group Issue), Series
1999, 5.250%, 7/01/29
3,980 Newark, New Jersey, Healthcare Facility Revenue Bonds (GNMA 6/12 at 102.00 Aaa 3,993,532
Collateralized - New Community Urban Renewal Corporation),
Series 2001A, 5.200%, 6/01/30
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 9.8%
3,790 The Hudson County Improvement Authority, New Jersey, Multifamily 6/04 at 100.00 AA 3,878,497
Housing Revenue Bonds (Conduit Financing - Observer Park
Project), Series 1992A, 6.900%, 6/01/22 (Alternative Minimum Tax)
1,255 Housing Finance Corporation of the City of Long Branch, New Jersey, 10/02 at 100.00 N/R 1,261,024
Section 8 Assisted Housing Revenue Bonds (Washington Manor
Associates Ltd., 1980 Elderly Project), 10.000%, 10/01/11
12,000 New Jersey Housing and Mortgage Finance Agency, Multifamily 11/02 at 101.00 AAA 12,261,600
Housing Revenue Refunding Bonds (Presidential Plaza at Newport
Project - FHA-Insured Mortgages), 1991 Series 1, 7.000%, 5/01/30
4,500 New Jersey Housing and Mortgage Finance Agency, Multifamily 5/05 at 102.00 AAA 4,745,430
Housing Revenue Bonds, 1995 Series A, 6.000%, 11/01/14
4,500 New Jersey Housing and Mortgage Finance Agency, Multifamily 5/06 at 102.00 AAA 4,711,995
Housing Revenue Bonds, 1996 Series A, 6.250%, 5/01/28
(Alternative Minimum Tax)
100 New Jersey Housing and Mortgage Finance Agency, Housing Revenue 11/02 at 102.00 A+ 102,810
Refunding Bonds, 1992 Series One, 6.700%, 11/01/28
2,743 Housing Authority of the City of Newark, New Jersey, Housing 10/09 at 102.00 Aaa 2,889,658
Revenue Bonds (GNMA Collateralized - Fairview Apartments
Project), 2000 Series A, 6.400%, 10/20/34
(Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 11.9%
2,110 New Jersey Housing and Mortgage Finance Agency, Home Buyer 10/02 at 100.00 AAA 2,114,811
Revenue Bonds, 1990 Series F-2, 6.300%, 4/01/25
(Alternative Minimum Tax)
2,580 New Jersey Housing and Mortgage Finance Agency, Home Buyer 10/05 at 101.50 AAA 2,688,386
Revenue Bonds, 1995 Series O, 6.350%, 10/01/27
(Alternative Minimum Tax)
4,415 New Jersey Housing and Mortgage Finance Agency, Home Buyer 4/07 at 101.50 AAA 4,587,936
Revenue Bonds, 1996 Series S, 6.050%, 10/01/28
(Alternative Minimum Tax)
19
Nuveen New Jersey Investment Quality Municipal Fund, Inc. (NQJ) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY (continued)
$ 10,000 New Jersey Housing and Mortgage Finance Agency, Home Buyer 10/07 at 101.50 AAA $ 10,283,200
Revenue Bonds, 1997 Series U, 5.850%, 4/01/29
(Alternative Minimum Tax)
10,325 New Jersey Housing and Mortgage Finance Agency, Home Buyer 10/10 at 100.00 AAA 10,647,347
Revenue Bonds, 2000 Series CC, 5.875%, 10/01/31
(Alternative Minimum Tax)
3,000 Puerto Rico Housing Finance Corporation, Home Mortgage Revenue 6/11 at 100.00 AAA 3,018,390
Bonds, Mortgage-Backed Securities, 2001 Series A, 5.200%, 12/01/33
3,000 Puerto Rico Housing Finance Corporation, Home Mortgage Revenue 6/11 at 100.00 AAA 3,007,470
Bonds, Mortgage-Backed Securities, 2001 Series B, 5.300%, 12/01/28
-----------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/OTHER - 1.6%
5,000 New Jersey Economic Development Authority, Economic Development No Opt. Call Baa3 4,949,000
Revenue Refunding Bonds (Kapkowski Road Landfill Project),
Series 2002, 5.750%, 10/01/21
-----------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 1.8%
New Jersey Healthcare Facilities Financing Authority, Healthcare
Facilities Revenue Bonds (The House of the Good Shepherd Obligated
Group Issue), Series 2001:
1,000 5.100%, 7/01/21 7/11 at 100.00 AA 1,011,880
1,500 5.200%, 7/01/31 7/11 at 100.00 AA 1,509,540
2,995 New Jersey Economic Development Authority, GNMA Collateralized 12/11 at 103.00 Aaa 2,996,048
Mortgage Revenue Bonds (Victoria Health Corporation Project),
Series 2001A, 5.200%, 12/20/36
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 13.4%
Clifton, New Jersey, General Obligation Bonds, Series 2002:
1,700 5.000%, 1/15/21 1/11 at 100.00 AAA 1,715,844
1,625 5.000%, 1/15/22 1/11 at 100.00 AAA 1,635,628
1,110 Township of East Brunswick, County of Middlesex, New Jersey, General 4/03 at 101.00 Aa2 1,128,648
Obligation Refunding Bonds, Series 1993, 5.125%, 4/01/13
County of Essex, New Jersey, General Obligation Refunding Bonds,
1996 Series A-1:
3,000 6.000%, 11/15/07 No Opt. Call Aaa 3,421,290
1,000 5.000%, 11/15/11 11/07 at 101.00 Aaa 1,059,760
2,320 City of Hoboken, New Jersey, Fiscal Year Adjustment General No Opt. Call AAA 2,854,737
Obligation Bonds, Series 1991, 8.900%, 8/01/06
3,675 Jersey City, Hudson County, New Jersey, Fiscal Year Adjustment Bonds, No Opt. Call AAA 4,410,404
Series 1991B, 8.400%, 5/15/06
The Board of Education of the Township of Middleton, Monmouth
County, New Jersey, Refunding School Bonds:
3,500 5.000%, 8/01/22 8/10 at 100.00 AAA 3,526,495
1,500 5.000%, 8/01/27 8/10 at 100.00 AAA 1,503,795
1,000 Monmouth County Improvement Authority, New Jersey, Revenue Bonds 7/07 at 101.00 AAA 1,078,140
(Howell Township Board of Education Project), Series 1997,
5.800%, 7/15/17
2,000 Town of Morristown, Morris County, New Jersey, General Obligation 8/05 at 102.00 AAA 2,248,480
Refunding Bonds, Series 1995, 6.500%, 8/01/19
State of New Jersey, General Obligation Bonds, Series D:
4,000 5.750%, 2/15/06 No Opt. Call AA 4,408,880
5,000 6.000%, 2/15/11 No Opt. Call AA 5,745,150
2,000 Commonwealth of Puerto Rico, Public Improvement Refunding General 7/11 at 100.00 AAA 2,011,600
Obligation Bonds, Series of 2001, 5.125%, 7/01/30
Sayreville School District, Middlesex County, New Jersey, General
Obligation Bonds, Series 2002:
1,470 5.000%, 3/01/24 3/12 at 100.00 AAA 1,478,306
1,545 5.000%, 3/01/25 3/12 at 100.00 AAA 1,551,365
900 Township of West Deptford, Gloucester County, New Jersey, General 3/06 at 102.00 AAA 948,375
Obligation Bonds, Series 1996, 5.250%, 3/01/14
20
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 13.4%
$ 3,320 The Atlantic County Improvement Authority, New Jersey, Egg Harbor 11/10 at 100.00 Aaa $ 3,413,757
Township Guaranteed Revenue Bonds (The Egg Harbor Township
Golf Corporation Project), Series 2000, 5.400%, 11/01/30
10,000 The Essex County Improvement Authority, New Jersey, General 10/10 at 100.00 Aaa 10,912,600
Obligation Guaranteed Lease Revenue Bonds (County Correctional
Facility Project), Series 2000, 6.000%, 10/01/25
2,535 The Board of Education of the Township of Mansfield, Warren County, 3/06 at 102.00 AAA 2,728,294
New Jersey, Certificates of Participation, 5.900%, 3/01/15
1,500 Middlesex County, New Jersey, Certificates of Participation, Series 8/11 at 100.00 AAA 1,500,480
2001, 5.000%, 8/01/31
New Jersey Economic Development Authority, Lease Revenue Bonds
(Bergen County Administration Complex), Series 1998:
500 4.050%, 11/15/03 No Opt. Call Aaa 515,855
4,000 4.750%, 11/15/26 11/08 at 101.00 Aaa 3,846,160
285 New Jersey Sports and Exposition Authority, State Contract Bonds, 9/02 at 102.00 AA- 290,700
1992 Series A, 6.500%, 3/01/19
5,670 New Jersey Transportation Trust Fund Authority, Transportation System 12/11 at 100.00 AAA 5,714,566
Bonds, 2001 Series B, 5.000%, 12/15/21
1,895 North Bergen Township Municipal Utility Authority, New Jersey, Sewer No Opt. Call AAA 2,410,535
Revenue Refunding Bonds, Series 1993, 7.875%, 12/15/09
1,000 The Ocean County Utilities Authority, New Jersey, Wastewater Revenue 1/07 at 102.00 Aa1 1,069,790
Refunding Bonds, Series 1997, 5.125%, 1/01/10
1,250 The Ocean County Utilities Authority, New Jersey, Wastewater Revenue 1/11 at 101.00 Aa1 1,278,962
Refunding Bonds, Series 2000, 5.000%, 1/01/18
4,000 Passaic Valley Sewerage Commissioners, New Jersey, Sewer System 12/02 at 102.00 AAA 4,138,840
Bonds, Series D, 5.800%, 12/01/18
845 The South Toms River Sewerage Authority, Ocean County, New Jersey, 11/02 at 102.00 N/R 869,074
Bank-Qualified Sewer Refunding Revenue Bonds, Series 1992,
7.400%, 11/01/05
2,000 The Board of Education of the Township of West Orange, Essex County, 10/09 at 101.00 Aaa 2,178,240
New Jersey, Certificates of Participation, 6.000%, 10/01/24
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 37.1%
3,275 The Delaware River and Bay Authority, Delaware and New Jersey, 1/10 at 101.00 AAA 3,491,052
Revenue Bonds, Series 2000A, 5.750%, 1/01/29
2,960 Delaware River Port Authority, Pennsylvania and New Jersey, 1/12 at 100.00 AAA 2,990,725
Port District
Project Revenue Refunding Bonds, Series 2001A, 5.200%, 1/01/27
7,000 Delaware River Port Authority, Pennsylvania and New Jersey, Revenue 1/06 at 102.00 AAA 7,202,300
Bonds, Series 1995, 5.500%, 1/01/26
3,500 Delaware River Port Authority, Pennsylvania and New Jersey, Revenue 1/10 at 100.00 AAA 3,724,560
Bonds, Series 1999, 5.750%, 1/01/22
3,000 New Jersey Economic Development Authority, Economic Development 11/02 at 101.00 BB- 2,633,700
Bonds (American Airlines, Inc. Project), 7.100%, 11/01/31
(Alternative Minimum Tax)
3,000 New Jersey Highway Authority, Senior Parkway Revenue and Refunding 1/10 at 101.00 AA- 3,157,080
Bonds (Garden State Parkway), 1999 Series, 5.625%, 1/01/30
New Jersey Turnpike Authority, Turnpike Revenue Bonds, Series 1991C:
9,000 6.500%, 1/01/08 No Opt. Call AAA 10,368,810
2,770 6.500%, 1/01/16 No Opt. Call A- 3,315,302
New Jersey Turnpike Authority, Turnpike Revenue Bonds, Series 2000A:
9,275 5.500%, 1/01/25 1/10 at 100.00 AAA 9,635,798
10,000 5.500%, 1/01/27 1/10 at 100.00 A- 10,389,000
2,000 5.500%, 1/01/30 1/10 at 100.00 AAA 2,071,440
5,000 The Port Authority of New York and New Jersey, Consolidated Bonds, 6/05 at 101.00 AAA 5,266,000
One Hundredth Series, 5.750%, 6/15/30
3,150 The Port Authority of New York and New Jersey, Consolidated Bonds, 7/04 at 101.00 AA- 3,240,626
Ninety-Fifth Series, 6.125%, 7/15/29 (Alternative Minimum Tax)
21
Nuveen New Jersey Investment Quality Municipal Fund, Inc. (NQJ) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION (continued)
$ 4,300 The Port Authority of New York and New Jersey, Special Project Bonds 12/02 at 102.00 BB $ 4,305,848
(Delta Air Lines, Inc. Project - LaGuardia Airport Passenger
Terminal), Series 1R, 6.950%, 6/01/08
3,930 The Port Authority of New York and New Jersey, Consolidated Bonds, 7/08 at 101.00 AA- 3,798,659
One Hundred Twenty Second Series, 5.125%, 1/15/36
(Alternative Minimum Tax)
The Port Authority of New York and New Jersey, Consolidated Bonds,
One Hundred Twenty Fifth Series:
2,280 5.000%, 10/15/26 4/12 at 101.00 AAA 2,262,398
5,000 5.000%, 4/15/32 4/12 at 101.00 AAA 4,924,950
6,850 The Port Authority of New York and New Jersey, Consolidated Bonds, 10/07 at 101.00 AAA 6,965,560
One Hundred Twenty First Series, 5.375%, 10/15/35
The Port Authority of New York and New Jersey, Special Project
Bonds (JFK International Air Terminal LLC Project), Series 6:
3,500 7.000%, 12/01/12 (Alternative Minimum Tax) No Opt. Call AAA 4,168,465
6,605 5.750%, 12/01/22 (Alternative Minimum Tax) 12/07 at 102.00 AAA 6,848,725
12,130 5.750%, 12/01/25 (Alternative Minimum Tax) 12/07 at 100.00 AAA 12,432,644
-----------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 6.7%
500 The Mercer County Improvement Authority, New Jersey, Revenue Bonds 12/03 at 102.00 Aa2*** 540,565
(Library System), Series 1994A, 6.000%, 12/01/14
(Pre-refunded to 12/01/03)
760 Middlesex County, New Jersey, Certificates of Participation, Series 2/04 at 101.00 AAA 817,958
1994, 6.125%, 2/15/19 (Pre-refunded to 2/15/04)
5,000 New Jersey, General Obligation Bonds, Various Series, 6.375%, 8/02 at 101.50 AA*** 5,097,800
8/01/11 (Pre-refunded to 8/01/02)
600 The Passaic Valley Water Commission, New Jersey, 1992 Water Supply 12/02 at 102.00 AAA 625,674
System Revenue Bonds, Series A, 6.400%, 12/15/22
(Pre-refunded to 12/15/02)
5,000 Commonwealth of Puerto Rico, Public Improvement Refunding Obligation 7/05 at 101.50 AAA 5,570,950
Bonds, Series 1995, 5.750%, 7/01/24 (Pre-refunded to 7/01/05)
7,500 Puerto Rico Infrastructure Financing Authority, Special 10/10 at 101.00 AAA 7,821,450
Obligation Bonds, 2000 Series A, 5.500%, 10/01/34
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES - 8.3%
3,700 Camden County Pollution Control Financing Authority, New Jersey, 12/02 at 101.00 B2 3,701,443
Solid Waste Disposal and Resource Recovery System Revenue Bonds,
Series 1991B, 7.500%, 12/01/09 (Alternative Minimum Tax)
3,500 Camden County Pollution Control Financing Authority, New Jersey, 12/02 at 101.00 B2 3,501,540
Solid Waste Disposal and Resource Recovery System Revenue
Bonds, Series 1991A, 7.500%, 12/01/10 (Alternative Minimum Tax)
400 New Jersey Economic Development Authority, Adjustable Fixed-Rate 7/02 at 102.50 A2 416,280
Pollution Control Revenue Bonds (Jersey Central Power and Light
Company Project), 1985 Series, 7.100%, 7/01/15
5,950 Puerto Rico Electric Power Authority, Power Revenue Refunding Bonds, 7/09 at 101.50 AAA 6,443,553
Series FF, 5.250%, 7/01/13
5,000 Puerto Rico Electric Power Authority, Power Revenue Refunding Bonds, No Opt. Call AAA 5,924,900
Series Y, 7.000%, 7/01/07
2,500 Salem County Pollution Control Financing Authority, New Jersey, 4/12 at 101.00 Baa1 2,502,700
Pollution Control Revenue Refunding Bonds (PSEG Power LLC
Project), 2001 Series A, 5.750%, 4/01/31 (Alternative Minimum Tax)
3,000 The Union County Utilities Authority, New Jersey, Solid Waste Facility 6/08 at 101.00 AAA 2,896,080
Senior Lease Revenue Bonds (Ogden Martin Systems of Union, Inc.
Lessee), Series 1998A, 5.000%, 6/01/23 (Alternative Minimum Tax)
22
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 9.9%
Cape May County Municipal Utilities Authority, New Jersey, Sewer
Revenue Refunding Bonds, Series 1992A:
$ 2,000 6.000%, 1/01/11 1/03 at 102.00 AAA $ 2,083,620
7,600 5.750%, 1/01/16 1/03 at 102.00 AAA 7,889,331
3,000 Jersey City Municipal Utilities Authority, Hudson County, New Jersey, 7/08 at 102.00 AAA 3,024,450
Sewer Revenue Bonds, Series 2001A-2, 5.200%, 7/15/21
(Alternative Minimum Tax)
7,500 New Jersey Economic Development Authority, Water Facilities Revenue 5/06 at 102.00 AAA 7,899,675
Bonds (New Jersey-American Water Company), Series 1996, 6.000%,
5/01/36 (Alternative Minimum Tax)
6,250 New Jersey Economic Development Authority, Water Facilities Revenue 7/08 at 102.00 AAA 6,214,870
Bonds (New Jersey-American Water Company, Inc. Project),
Series 1998A, 5.250%, 7/01/38 (Alternative Minimum Tax)
3,000 The North Hudson Sewerage Authority, New Jersey, Sewer Revenue 8/12 at 100.00 Aaa 3,149,700
Refunding Bonds, Series 2002A,
5.250%, 8/01/18
-----------------------------------------------------------------------------------------------------------------------------
$ 443,648 Total Investments (cost $444,499,422) - 151.2% 461,027,530
===========------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.2%
$ 500 The Port Authority of New York and New Jersey, Special Obligation Bonds VMIG-1 500,000
=========== Versatile Structure, Variable Rate Demand Bonds, Third Series, 1.900%, 6/01/20+
---------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.7% 5,280,363
---------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (53.1)% (162,000,000)
---------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 304,807,893
===============================================================================================================
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call
or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
(DD) Portion of security purchased on a delayed delivery basis.
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically based
on market conditions or a specified market index.
See accompanying notes to financial statements.
23
Nuveen New Jersey Premium Income Municipal Fund, Inc. (NNJ)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
BASIC MATERIALS - 0.4%
$ 710 New Jersey Economic Development Authority, Economic Growth Bonds, 12/03 at 102.00 Aa3 $ 742,021
Composite Issue, 1992 Second Series T, 5.300%, 12/01/07
(Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 3.4%
6,220 The Children's Trust Fund, Puerto Rico, Tobacco Settlement 7/10 at 100.00 Aa3 6,353,917
Asset-Backed Bonds, Series 2000, 5.750%, 7/01/20
-----------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 15.8%
New Jersey Higher Education Student Assistance Authority, Student
Loan Revenue Bonds, 2000 Series A:
3,180 5.700%, 6/01/08 (Alternative Minimum Tax) No Opt. Call AAA 3,495,997
2,140 6.000%, 6/01/15 (Alternative Minimum Tax) 6/10 at 101.00 AAA 2,326,651
3,280 New Jersey Economic Development Authority, Economic Development No Opt. Call N/R 3,605,245
Bonds (Yeshiva Ktana of Passaic 1992 Project), 8.000%, 9/15/18
2,965 New Jersey Economic Development Authority, School Revenue Bonds 2/08 at 101.00 N/R 2,930,487
(Gill/St. Bernard School), Series 1998, 6.000%, 2/01/25
600 New Jersey Educational Facilities Authority, Revenue Bonds (Trenton 7/02 at 100.00 A- 602,418
State College Issue), Series 1976D, 6.750%, 7/01/08
2,095 New Jersey Educational Facilities Authority, Refunding Revenue Bonds 8/02 at 102.00 AAA 2,145,720
(Trenton State College Issue), Series 1992E, 6.000%, 7/01/09
(Pre-refunded to 8/01/02)
1,000 New Jersey Educational Facilities Authority, Revenue Bonds (New 7/04 at 102.00 AAA 1,074,540
Jersey Institute of Technology Issue), Series 1994A, 6.000%, 7/01/24
3,330 New Jersey Educational Facilities Authority, Revenue Bonds (Montclair 7/06 at 101.00 AAA 3,521,242
State University Dormitory/Cafeteria Facility), Series 1996C,
5.400%, 7/01/12
2,500 New Jersey Educational Facilities Authority, Revenue Bonds (Princeton 7/10 at 100.00 AAA 2,677,825
University), Series 2000E, 5.500%, 7/01/17
520 New Jersey Higher Education Assistance Authority, Student Loan 7/02 at 102.00 A+ 531,008
Revenue Bonds (New Jersey Class Loan Program), 1992 Series A,
6.125%, 7/01/09 (Alternative Minimum Tax)
3,640 New Jersey Higher Education Assistance Authority, Student Loan 6/09 at 101.00 AAA 3,750,984
Revenue Bonds, 1999 Series A, 5.250%, 6/01/18
(Alternative Minimum Tax)
3,000 University of Medicine and Dentistry, New Jersey, Revenue Bonds, 12/12 at 100.00 AAA 2,979,300
Series 2002A, 5.000%, 12/01/31
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 10.6%
New Jersey Healthcare Facilities Financing Authority, Revenue
Bonds (Dover General Hospital and Medical Center Issue), Series
1994:
1,015 7.000%, 7/01/03 No Opt. Call AAA 1,069,028
800 7.000%, 7/01/04 No Opt. Call AAA 876,112
3,500 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/11 at 100.00 A3 3,513,475
(Kennedy Health System), Series 2001, 5.625%, 7/01/31
1,710 New Jersey Healthcare Facilities Financing Authority, Revenue 1/12 at 100.00 AA 1,713,198
Refunding Bonds (Bayshore Community Hospital), Series 2002,
5.000%, 7/01/22
1,130 New Jersey Healthcare Facilities Financing Authority, Revenue 7/12 at 100.00 A- 1,150,204
Refunding Bonds (Atlantic City Medical Center), Series 2002,
5.750%, 7/01/25
1,500 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/12 at 100.00 Baa1 1,487,280
(South Jersey Hospital), Series 2002, 5.875%, 7/01/21
2,900 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 1/10 at 101.00 A2 2,984,564
(Hackensack University Medical Center Issue), Series 2000,
6.000%, 1/01/34
24
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE (continued)
$ 2,000 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/10 at 100.00 AAA $ 2,208,260
(The Society of the Valley Obligated Group Issue), Series 2000,
5.750%, 7/01/15
1,800 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/09 at 101.00 AAA 1,981,008
(Meridian Health SystemObligated Group Issue), Series 1999,
5.625%, 7/01/12
2,900 Puerto Rico Industrial, Medical, Educational and Environmental 12/03 at 103.00 A2 2,932,567
Pollution Control Facilities Financing Authority, Adjustable Rate
Industrial Revenue Bonds (American Home Products Corporation),
1983 Series A, 5.100%, 12/01/18
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 8.1%
755 Long Branch Housing Finance Corporation, New Jersey, Section 8 10/02 at 100.00 N/R 758,624
Assisted Housing Revenue Bonds (Washington Manor Associates
Ltd. - 1980 Elderly Project), 10.000%, 10/01/11
4,000 New Jersey Housing and Mortgage Finance Agency, Multifamily Housing 11/02 at 101.00 AAA 4,087,200
Revenue Refunding Bonds (Presidential Plaza at Newport Project -
FHA-Insured Mortgages), 1991 Series 1, 7.000%, 5/01/30
2,875 New Jersey Housing and Mortgage Finance Agency, Multifamily Housing 5/05 at 102.00 AAA 3,031,803
Revenue Bonds, 1995 Series A, 6.000%, 11/01/14
7,000 New Jersey Housing and Mortgage Finance Agency, Multifamily Housing 11/07 at 101.50 AAA 7,126,070
Revenue Bonds, 1997 Series A, 5.550%, 5/01/27
(Alternative Minimum Tax)
135 New Jersey Housing and Mortgage Finance Agency, Housing Revenue 11/02 at 102.00 A+ 138,794
Refunding Bonds, 1992 Series One, 6.700%, 11/01/28
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 7.0%
1,000 New Jersey Housing and Mortgage Finance Agency, Home Buyer 10/05 at 101.50 AAA 1,042,540
Revenue Bonds, 1995 Series O, 6.300%, 10/01/23
(Alternative Minimum Tax)
525 New Jersey Housing and Mortgage Finance Agency, Home Buyer 4/06 at 101.50 AAA 552,190
Revenue Bonds, 1996 Series P, 5.650%, 4/01/14
6,130 New Jersey Housing and Mortgage Finance Agency, Home Buyer 4/07 at 101.50 AAA 6,370,112
Revenue Bonds, 1996 Series S, 6.050%, 10/01/28
(Alternative Minimum Tax)
New Jersey Housing and Mortgage Finance Agency, Home Buyer Revenue
Bonds, 1997 Series U:
1,965 5.700%, 10/01/14 (Alternative Minimum Tax) 10/07 at 101.50 AAA 2,076,081
1,500 5.850%, 4/01/29 (Alternative Minimum Tax) 10/07 at 101.50 AAA 1,542,480
1,000 New Jersey Housing and Mortgage Finance Agency, Home Buyer 10/08 at 101.50 AAA 998,500
Revenue Bonds, 1998 Series X, 5.350%, 4/01/29
(Alternative Minimum Tax)
500 New Jersey Housing and Mortgage Finance Agency, Home Buyer No Opt. Call AAA 530,185
Revenue Bonds, 2000 Series CC, 4.600%, 10/01/09
-----------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/OTHER - 0.5%
1,000 New Jersey Economic Development Authority, Economic Development No Opt. Call Baa3 989,800
Revenue Refunding Bonds (Kapkowski Road Landfill Project),
Series 2002, 5.750%, 10/01/21
-----------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 1.8%
3,255 New Jersey Economic Development Authority, Revenue Bonds (Morris 4/03 at 103.00 A+ 3,390,961
Hall/St. Lawrence, Inc. Project), Series 1993A, 6.150%, 4/01/13
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 11.2%
2,460 The Board of Education of Freehold Regional High School District, No Opt. Call AAA 2,581,450
Monmouth County, New Jersey, School District Refunding Bonds,
Series 2001, 5.000%, 3/01/17
State of New Jersey, General Obligation Bonds, Series D:
2,760 5.750%, 2/15/06 No Opt. Call AA 3,042,127
4,000 5.800%, 2/15/07 No Opt. Call AA 4,464,200
2,500 6.000%, 2/15/11 No Opt. Call AA 2,872,575
1,560 6.000%, 2/15/13 No Opt. Call AA 1,803,766
4,000 County of Passaic, New Jersey, General Improvement Refunding Bonds, No Opt. Call AAA 4,357,200
Series 1993, 5.125%, 9/01/12
1,800 The Township of Woodbridge, Middlesex County, New Jersey, Sewer 7/09 at 102.00 Aaa 1,874,142
Utility Bonds, Series 1999, 5.300%, 7/01/20
25
Nuveen New Jersey Premium Income Municipal Fund, Inc. (NNJ) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 21.1%
$ 1,275 Camden County Improvement Authority, New Jersey, County Guaranteed 10/05 at 102.00 AAA $ 1,362,261
Lease Revenue Bonds, Series 1995, 5.625%, 10/01/15
1,000 Hudson County Improvement Authority, New Jersey, Utility System 1/08 at 101.50 AAA 1,023,880
Revenue Bonds (Harrison Franchise Acquisition Project),
Series 1997, 5.350%, 1/01/27
2,250 New Jersey Building Authority, State Building Revenue Bonds, Series 6/10 at 100.00 AA- 2,286,720
2000A, 5.125%, 6/15/20
2,000 New Jersey Economic Development Authority, Lease Revenue Bonds 11/08 at 101.00 Aaa 1,923,080
(Bergen County Administration Complex), Series 1998,
4.750%, 11/15/26
1,000 New Jersey Economic Development Authority, Revenue Bonds (Public 8/03 at 102.00 AAA 1,058,730
Schools Small Project Loan Program), Series 1993, 5.400%, 8/15/12
1,500 New Jersey Economic Development Authority, Market Transition Facility No Opt. Call AAA 1,643,640
Senior Lien Revenue Bonds, Series 1994A, 7.000%, 7/01/04
2,025 New Jersey Transportation Trust Fund Authority, Transportation System 12/11 at 100.00 AAA 2,276,060
Bonds, 2001 Series B, 6.000%, 12/15/19
New Jersey Transportation Trust Fund Authority, Transportation System
Bonds, 1995 Series A:
385 5.500%, 6/15/12 6/05 at 102.00 AAA 407,330
5,000 5.000%, 6/15/15 6/05 at 102.00 AAA 5,138,000
685 New Jersey Transportation Trust Fund Authority, Transportation System 6/05 at 102.00 AAA 720,004
Bonds, 1995 Series B, 5.500%, 6/15/15
1,040 Passaic Valley Sewerage Commissioners, New Jersey, Sewer System 12/02 at 102.00 AAA 1,078,709
Bonds, Series D, 5.750%, 12/01/10
510 The Board of Education of the Township of Piscataway, Middlesex 6/03 at 102.00 AAA 537,107
County, New Jersey, Certificates of Participation, 1993
Series, 5.375%, 12/15/10
8,160 Puerto Rico Public Building Authority, Public Education and Health 7/03 at 101.50 A- 8,548,906
Facilities Refunding Bonds, Guaranteed by the Commonwealth of
Puerto Rico, Series M, 5.750%, 7/01/15
7,500 Puerto Rico Municipal Finance Agency, Revenue Bonds, 1999 Series A, 8/09 at 101.00 AAA 8,059,800
5.500%, 8/01/17
1,000 The Stony Brook Regional Sewerage Authority, Princeton, New Jersey, No Opt. Call AA- 1,117,250
Revenue Refunding Bonds, 1993 Series B, 5.450%, 12/01/12
2,250 Western Monmouth Utilities Authority, New Jersey, Revenue Refunding 2/05 at 102.00 AAA 2,386,620
Bonds, 1995 Series A, 5.600%, 2/01/14
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 35.7%
5,000 Delaware River Port Authority, New Jersey, Port District Project 1/08 at 101.00 AAA 5,067,850
Bonds, Series 1998B, 5.000%, 1/01/19
New Jersey Turnpike Authority, Turnpike Revenue Bonds, Series 1991C:
1,340 6.500%, 1/01/08 No Opt. Call A- 1,536,565
2,185 6.500%, 1/01/16 No Opt. Call AAA 2,649,793
3,505 6.500%, 1/01/16 No Opt. Call AAA 4,250,584
8,420 6.500%, 1/01/16 No Opt. Call A- 10,077,561
2,495 New Jersey Turnpike Authority, Turnpike Revenue Bonds, Series 2000A, 1/10 at 100.00 AAA 2,592,056
5.500%, 1/01/25
3,000 The Port Authority of New York and New Jersey, Consolidated Bonds, 10/04 at 101.00 AAA 3,258,630
Ninety Sixth Series, 6.600%, 10/01/23 (Alternative Minimum Tax)
The Port Authority of New York and New Jersey, Consolidated Bonds,
Ninety-Ninth Series:
1,200 5.750%, 11/01/09 (Alternative Minimum Tax) 5/05 at 101.00 AAA 1,302,168
2,500 5.750%, 11/01/14 (Alternative Minimum Tax) 5/05 at 101.00 AAA 2,661,175
1,500 The Port Authority of New York and New Jersey, Consolidated Bonds, 7/06 at 101.00 AA- 1,583,220
One Hundred Sixth Series, 6.000%, 7/01/16
(Alternative Minimum Tax)
The Port Authority of New York and New Jersey, Consolidated Bonds,
One Hundredth Series:
2,500 5.750%, 12/15/20 6/05 at 101.00 AAA 2,594,625
2,000 5.750%, 6/15/30 6/05 at 101.00 AAA 2,106,400
2,000 The Port Authority of New York and New Jersey, Consolidated Bonds, 6/05 at 101.00 AA- 2,057,340
One Hundred Twelfth Series, 5.250%, 12/01/13
(Alternative Minimum Tax)
26
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION (continued)
$ 2,000 The Port Authority of New York and New Jersey, Consolidated Bonds, 4/12 at 101.00 AAA $ 1,969,980
One Hundred Twenty Fifth Series, 5.000%, 4/15/32
The Port Authority of New York and New Jersey, Special Project
Bonds (JFK International Air Terminal LLC Project), Series 6:
10,000 5.750%, 12/01/22 (Alternative Minimum Tax) 12/07 at 102.00 AAA 10,369,000
11,000 5.750%, 12/01/25 (Alternative Minimum Tax) 12/07 at 100.00 AAA 11,274,450
1,435 South Jersey Transportation Authority, New Jersey, Transportation 11/09 at 101.00 AAA 1,455,119
System Revenue Bonds, 1999 Series, 5.125%, 11/01/22
-----------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 12.1%
1,000 The Essex County Utilities Authority, New Jersey, Solid Waste System 4/06 at 102.00 AAA 1,118,150
Revenue Bonds, Secured by a County Deficiency Agreement,
Series 1996A, 5.600%, 4/01/16 (Pre-refunded to 4/01/06)
745 New Jersey Healthcare Facilities Financing Authority, Refunding 8/04 at 102.00 Aa2*** 815,872
Revenue Bonds (Wayne General Hospital Corp. Issue - FHA-Insured
Mortgage), Series B, 5.750%, 8/01/11 (Pre-refunded to 8/01/04)
2,000 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/04 at 102.00 AAA 2,206,820
(Monmouth Medical Center Issue), Series C, 6.250%, 7/01/16
(Pre-refunded to 7/01/04)
New Jersey Educational Facilities Authority, Revenue Bonds (Trenton
State College Issue), Series 1996A:
4,000 5.100%, 7/01/21 (Pre-refunded to 7/01/06) 7/06 at 101.00 AAA 4,386,320
3,750 5.125%, 7/01/24 (Pre-refunded to 7/01/06) 7/06 at 101.00 AAA 4,115,700
2,500 New Jersey Educational Facilities Authority, Revenue Bonds (Rowan 7/06 at 101.00 AAA 2,826,225
College of New Jersey Issue), Series 1996E, 6.000%, 7/01/21
(Pre-refunded to 7/01/06)
2,000 New Jersey Transit Corporation, Federal Transit Administration Grants, 9/09 at 100.00 AAA 2,317,520
Certificates of Participation, Series 2000A, 6.125%, 9/15/15
(Pre-refunded to 9/15/09)
115 New Jersey Transportation Trust Fund Authority, Transportation System No Opt. Call AAA 127,020
Bonds, 1995 Series A, 5.500%, 6/15/12
415 New Jersey Transportation Trust Fund Authority, Transportation System 6/05 at 102.00 AAA 458,376
Bonds, 1995 Series B, 5.500%, 6/15/15 (Pre-refunded to 6/15/05)
580 New Jersey Turnpike Authority, Turnpike Revenue Bonds, 1984 Series, No Opt. Call AAA 605,845
10.375%, 1/01/03
Sparta Township School District, New Jersey, General Obligation Bonds
(Unlimited Tax):
1,100 5.800%, 9/01/19 (Pre-refunded to 9/01/06) 9/06 at 100.00 AAA 1,229,954
1,100 5.800%, 9/01/20 (Pre-refunded to 9/01/06) 9/06 at 100.00 AAA 1,229,954
1,100 5.800%, 9/01/21 (Pre-refunded to 9/01/06) 9/06 at 100.00 AAA 1,229,954
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES - 2.7%
2,835 Camden County Pollution Control Financing Authority, New Jersey, 12/02 at 101.00 B2 2,833,526
Solid Waste Disposal and Resource Recovery System Revenue Bonds,
Series 1991D, 7.250%, 12/01/10
2,000 Puerto Rico Electric Power Authority, Power Revenue Refunding Bond, 7/09 at 101.50 AAA 2,165,900
Series FF, 5.250%, 7/01/13
-----------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 17.3%
5,250 Cape May County, New Jersey, Municipal Utilities Authority, Sewer 1/03 at 102.00 AAA 5,449,868
Revenue Refunding Bonds, Series 1992A, 5.750%, 1/01/16
1,000 The Jersey City Sewerage Authority, Hudson County, New Jersey, Sewer No Opt. Call AAA 1,178,050
Revenue Refunding Bonds, Series 1993, 6.250%, 1/01/14
3,100 New Jersey Economic Development Authority, Water Facilities Revenue 3/04 at 102.00 AAA 3,201,277
Refunding Bonds (Hackensack Water Company Project), 1994
Series B, 5.900%, 3/01/24 (Alternative Minimum Tax)
3,250 New Jersey Economic Development Authority, Water Facilities Revenue 7/08 at 102.00 AAA 3,231,735
Bonds (New Jersey-American Water Company, Inc. Project), Series
1998A, 5.250%, 7/01/38 (Alternative Minimum Tax)
27
Nuveen New Jersey Premium Income Municipal Fund, Inc. (NNJ) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER (continued)
$ 6,950 New Jersey Environmental Infrastructure Trust, Environmental 9/11 at 101.00 AAA $ 6,886,964
Infrastructure Bonds, Series 2001A, 4.750%, 9/01/20
7,000 The North Hudson Sewerage Authority, New Jersey, Sewer Revenue 8/06 at 101.00 AAA 7,068,950
Bonds, Series 1996, 5.125%, 8/01/22
3,500 The North Hudson Sewerage Authority, New Jersey, Sewer Revenue 8/12 at 100.00 Aaa 3,648,854
Refunding Bonds, Series 2002A, 5.250%, 8/01/19
1,500 The Wanaque Valley Regional Sewerage Authority, Passaic County, No Opt. Call AAA 1,692,430
New Jersey, Insured Sewer
Revenue Refunding Bonds, 1993 Series B, 5.750%, 9/01/18
-----------------------------------------------------------------------------------------------------------------------------
$ 261,605 Total Investments (cost $260,681,430) - 147.7% 276,683,728
==========-------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.2% 2,308,864
---------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (48.9)% (91,600,000)
---------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 187,392,592
===============================================================================================================
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call
or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
See accompanying notes to financial statements.
28
Nuveen New Jersey Dividend Advantage Municipal Fund (NXJ)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS - 0.3%
$ 250 New Jersey Economic Development Authority, Industrial Development 4/06 at 102.00 Ba3 $ 253,025
Revenue Refunding Bonds (Newark Airport Marriott Hotel), Series
1996, 7.000%, 10/01/14
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 6.3%
5,715 The Children's Trust Fund, Puerto Rico, Tobacco Settlement 7/10 at 100.00 Aa3 5,956,287
Asset-Backed Bonds, Series 2000, 6.000%, 7/01/26
-----------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 17.7%
2,000 New Jersey Educational Facilities Authority, Revenue Bonds (Rowan 7/11 at 101.00 AAA 1,986,360
University), Series 2001C, 5.000%, 7/01/31
200 New Jersey Educational Facilities Authority, Revenue Refunding Bonds 7/11 at 100.00 AAA 212,302
(Seton Hall University Project), Series 2001A, 5.250%, 7/01/16
New Jersey Educational Facilities Authority, Revenue Refunding
Bonds (Seton Hall University Project), Series 2001G:
3,820 4.875%, 7/01/21 7/11 at 100.00 AAA 3,810,603
1,600 5.000%, 7/01/26 7/11 at 100.00 AAA 1,598,880
1,000 New Jersey Educational Facilities Authority, Revenue Bonds (New 7/11 at 100.00 AAA 1,045,620
Jersey Institute of Technology), Series 2001G, 5.250%, 7/01/18
1,565 New Jersey Educational Facilities Authority, Revenue Bonds (Princeton 7/10 at 100.00 AAA 1,655,582
University), Series 2000E, 5.250%, 7/01/16
Puerto Rico Industrial, Educational, Medical and Environmental
Control Facilities Financing Authority, Higher Education Revenue
Bonds (University of the Sacred Heart Project), Series 2001:
2,000 5.250%, 9/01/21 9/11 at 100.00 BBB 2,002,000
2,000 5.250%, 9/01/31 9/11 at 100.00 BBB 1,957,460
500 Puerto Rico Industrial, Tourist, Educational, Medical and 12/12 at 101.00 BBB 493,160
Environmental Control Facilities Financing Authority, Higher
Education Revenue Refunding Bonds (Ana G. Mendez University
System Project), Series 2002, 5.500%, 12/01/31
1,905 University of Puerto Rico, University System Revenue Bonds, Series M, 6/05 at 101.50 AAA 1,922,583
5.250%, 6/01/25
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 33.0%
3,500 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/11 at 100.00 A3 3,513,475
(Kennedy Health System), Series 2001, 5.625%, 7/01/31
900 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/12 at 100.00 Baa1 892,368
(South Jersey Hospital), Series 2002, 5.875%, 7/01/21
1,100 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds No Opt. Call AAA 1,220,681
(Kennedy Health System Obligated Group), Series 1998B,
5.750%, 7/01/06
500 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/10 at 101.00 BBB- 541,305
(Trinitas Hospital Obligated Group Issue), Series 2000,
7.500%, 7/01/30
New Jersey Healthcare Facilities Financing Authority, Revenue
Bonds (Robert Wood Johnson University Hospital), Series 2000:
3,000 5.750%, 7/01/25 7/10 at 100.00 A+ 3,131,880
13,235 5.750%, 7/01/31 7/10 at 100.00 A+ 13,667,387
6,000 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 1/09 at 101.00 AAA 5,462,880
(Virtua Health System), Series 1998, 4.500%, 7/01/28
2,500 New Jersey Healthcare Facilities Financing Authority, Revenue 7/09 at 101.00 A2 2,502,400
Refunding Bonds (Burdette Tomlin Memorial Hospital),
Series 1999, 5.500%, 7/01/29
29
Nuveen New Jersey Dividend Advantage Municipal Fund (NXJ) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/OTHER - 0.4%
$ 390 New Jersey Economic Development Authority, District Heating and 12/03 at 102.00 BBB- $ 393,553
Cooling Revenue Bonds (Trigen-Trenton Project), 1993 Series B,
6.100%, 12/01/04 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 1.5%
New Jersey Economic Development Authority, Economic Development
Revenue Bonds (Masonic Charity Foundation Project), Series 2001:
1,000 6.000%, 6/01/25 6/11 at 102.00 A+ 1,078,540
335 5.500%, 6/01/31 6/11 at 102.00 A+ 342,300
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 18.7%
Board of Education of the Township of Hamilton, Mercer County, New
Jersey, General Obligation Bonds, Series 2001:
1,850 4.750%, 8/15/18 8/10 at 100.00 AAA 1,864,171
1,630 4.750%, 8/15/19 8/10 at 100.00 AAA 1,633,733
Commonwealth of Puerto Rico, Public Improvement Refunding General
Obligation Bonds, Series of 2001:
3,500 5.250%, 7/01/27 7/11 at 100.00 AAA 3,557,225
10,500 5.125%, 7/01/30 7/11 at 100.00 AAA 10,560,900
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 12.1%
New Jersey Economic Development Authority, School Facilities
Construction Bonds, 2001 Series A:
2,000 5.250%, 6/15/19 6/11 at 100.00 AAA 2,077,460
2,400 5.000%, 6/15/21 6/11 at 100.00 AAA 2,418,072
3,110 New Jersey Transportation Trust Fund Authority, Transportation System 6/09 at 100.00 AA- 3,178,700
Bonds, 1998 Series A, 5.000%, 6/15/17
2,350 Puerto Rico Highway and Transportation Authority, Transportation 7/18 at 100.00 AAA 2,202,185
Revenue Bonds, Series A, 4.750%, 7/01/38
1,500 Virgin Islands Public Finance Authority, Revenue and Refunding Bonds 10/08 at 101.00 AA 1,548,570
(Virgin Islands Matching Fund Loan Notes), Series 1998A (Senior
Lien/Refunding), 5.500%, 10/01/18
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 24.7%
8,000 New Jersey Economic Development Authority, Special Facilities Revenue 11/10 at 101.00 B+ 7,426,080
Bonds (Continental Airlines, Inc. Project), Series 2000, 7.000%,
11/15/30 (Alternative Minimum Tax)
3,000 The Port Authority of New York and New Jersey, Consolidated Bonds, 1/07 at 101.00 AAA 3,049,530
One Hundred Ninth Series, 5.375%, 1/15/32
3,500 The Port Authority of New York and New Jersey, Consolidated Bonds, 10/07 at 101.00 AAA 3,572,625
One Hundred Twentieth Series, 5.500%, 10/15/35
(Alternative Minimum Tax)
5,000 The Port Authority of New York and New Jersey, Special Project Bonds 12/07 at 102.00 AAA 5,184,500
(JFK International Air Terminal LLC Project), Series 6, 5.750%,
12/01/22 (Alternative Minimum Tax)
4,000 South Jersey Transportation Authority, New Jersey, Transportation 11/09 at 101.00 AAA 4,056,080
System Revenue Bonds, 1999 Series, 5.125%, 11/01/22
-----------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 4.4%
4,000 Puerto Rico Infrastructure Financing Authority, Special Obligation 10/10 at 101.00 AAA 4,165,720
Bonds, 2000 Series A, 5.500%, 10/01/40
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES - 3.2%
3,045 Pollution Control Financing Authority of Camden County, New Jersey, 12/02 at 101.00 B2 3,046,188
Solid Waste Disposal and Resource Recovery System Revenue
Bonds, Series 1991B, 7.500%, 12/01/09 (Alternative Minimum Tax)
30
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 26.4%
$ 4,635 New Jersey Economic Development Authority, Water Facilities Revenue 5/08 at 102.00 AAA $ 4,683,946
Bonds (New Jersey - American Water Company Project),
Series 1997B, 5.375%, 5/01/32
7,000 New Jersey Economic Development Authority, Water Facilities Revenue 2/08 at 102.00 AAA 7,045,150
Bonds (Middlesex Water Company Project), Series 1998, 5.350%,
2/01/38 (Alternative Minimum Tax)
5,000 New Jersey Economic Development Authority, Water Facilities Revenue 7/08 at 102.00 AAA 4,971,900
Bonds (New Jersey - American Water Company, Inc. Project),
Series 1998A, 5.250%, 7/01/38 (Alternative Minimum Tax)
2,775 New Jersey Environmental Infrastructure Trust, Environmental 9/08 at 101.00 AAA 2,717,058
Infrastructure Bonds, Series 1998A, 4.500%, 9/01/18
15,840 The North Hudson Sewerage Authority, New Jersey, Sewer No Opt. Call Aaa 5,336,970
Refunding Revenue Bonds, Series 2001A, 0.000%, 8/01/23
-----------------------------------------------------------------------------------------------------------------------------
$ 149,650 Total Investments (cost $138,652,292) - 148.7% 139,937,394
==========-------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.3% 2,192,906
---------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (51.0)% (48,000,000)
---------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 94,130,300
===============================================================================================================
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call
or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
See accompanying notes to financial statements.
31
Nuveen New Jersey Dividend Advantage Municipal Fund 2 (NUJ)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS - 1.9%
$ 1,250 New Jersey Economic Development Authority, Industrial Development 4/06 at 102.00 Ba3 $ 1,265,125
Revenue Refunding Bonds (Newark Airport Marriott Hotel), Series
1996, 7.000%, 10/01/14
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 6.7%
3,000 The Children's Trust Fund, Puerto Rico, Tobacco Settlement 7/10 at 100.00 Aa3 3,126,660
Asset-Backed Bonds, Series 2000, 6.000%, 7/01/26
1,325 Tobacco Settlement Financing Corporation of the Virgin Islands, 5/11 at 100.00 A3 1,230,501
Asset-Backed Bonds, Series 2001, 5.000%, 5/15/31
-----------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 15.5%
1,090 New Jersey Educational Facilities Authority, Revenue Refunding Bonds 7/12 at 100.00 AA 1,122,449
(Rider University), Series 2002A, 5.000%, 7/01/17
3,000 New Jersey Educational Facilities Authority, Revenue Bonds (College 7/12 at 100.00 AAA 2,994,780
of New Jersey Project), Series 2002C, 4.750%, 7/01/19
Puerto Rico Industrial, Tourist, Educational, Medical and Environmental
Control Facilities Financing Authority, Higher Education Revenue Bonds
(Ana G. Mendez University System Project), Series 1999:
2,000 5.375%, 2/01/19 2/09 at 101.00 BBB 2,009,460
1,000 5.375%, 2/01/29 2/09 at 101.00 BBB 972,380
3,000 University of Medicine and Dentistry, New Jersey, Revenue Bonds, 12/12 at 100.00 AAA 2,979,300
Series 2002A, 5.000%, 12/01/31
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 28.8%
1,500 New Jersey Healthcare Facilities Financing Authority, Revenue 7/07 at 102.00 BBB- 1,457,475
Refunding Bonds (Saint Elizabeth Hospital Obligated Group),
Series 1997, 6.000%, 7/01/27
New Jersey Healthcare Facilities Financing Authority, Revenue
Bonds (Jersey City Medical Center Issue, FHA-Insured Mortgage),
Series 2001:
1,000 5.000%, 8/01/31 8/11 at 100.00 AAA 987,120
1,925 5.000%, 8/01/41 8/11 at 100.00 AAA 1,890,831
1,150 New Jersey Healthcare Facilities Financing Authority, Revenue 1/12 at 100.00 AA 1,147,367
Refunding Bonds (Bayshore Community Hospital), Series 2002,
5.125%, 7/01/32
1,000 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/12 at 101.00 BBB- 1,013,240
(Palisades Medical Center of New York, Presbyterian Healthcare
System), Series 2002, 6.625%, 7/01/31
2,500 New Jersey Healthcare Facilities Financing Authority, Revenue 7/12 at 100.00 A- 2,544,700
Refunding Bonds (Atlantic City Medical Center), Series 2002,
5.750%, 7/01/25
2,460 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/12 at 100.00 Baa1 2,439,139
(South Jersey Hospital), Series 2002, 5.875%, 7/01/21
3,500 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/10 at 100.00 A+ 3,614,345
(Robert Wood Johnson University Hospital), Series 2000,
5.750%, 7/01/31
510 New Jersey Healthcare Facilities Financing Authority, Revenue Bonds 7/09 at 101.00 AAA 515,809
(Meridian Health System Obligated Group Issue), Series 1999,
5.250%, 7/01/29
3,100 Puerto Rico Industrial, Medical, Educational and Environmental 12/03 at 103.00 A2 3,134,813
Pollution Control Facilities Financing Authority, Adjustable Rate
Industrial Revenue Bonds (American Home Products Corporation),
1983 Series A, 5.100%, 12/01/18
32
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 3.5%
$ 2,250 New Jersey Housing and Mortgage Finance Agency, Multifamily 11/07 at 101.50 AAA $ 2,289,533
Housing Revenue Bonds, 1997 Series A, 5.650%, 5/01/40
(Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/OTHER - 4.1%
2,700 New Jersey Economic Development Authority, Economic Development No Opt. Call Baa3 2,672,460
Revenue Refunding Bonds (Kapkowski Road Landfill Project),
Series 2002, 5.750%, 10/01/21
-----------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 7.9%
New Jersey Economic Development Authority, Economic Development
Revenue Bonds (Masonic Charity Foundation Project), Series 2001:
1,000 5.500%, 6/01/21 6/11 at 102.00 A+ 1,032,720
4,000 5.500%, 6/01/31 6/11 at 102.00 A+ 4,087,160
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 7.7%
3,000 The Township of Jackson, Ocean County, New Jersey, General Obligation 4/12 at 100.00 AAA 3,024,060
Bonds, Series 2002, 5.000%, 4/15/21
1,000 Old Bridge Township Board of Education, Middlesex County, New 7/11 at 100.00 AAA 1,001,060
Jersey, General Obligation Bonds, Series 2002, 5.000%, 7/15/30
1,000 Commonwealth of Puerto Rico, Public Improvement General Obligation 7/11 at 100.00 AAA 1,010,780
Bonds, Series 2001, 5.125%, 7/01/23
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 13.5%
3,000 The Brick Township Municipal Utilities Authority, Ocean County, New 12/12 at 100.00 Aaa 3,001,080
Jersey, Revenue Bonds, Series 2002, 5.000%, 12/01/25
680 New Jersey Transportation Trust Fund Authority, Transportation System 12/11 at 100.00 AAA 685,345
Bonds, 2001 Series B, 5.000%, 12/15/21
1,000 Puerto Rico Public Finance Corporation, Commonwealth Appropriation No Opt. Call AAA 1,036,150
Bonds, 1998 Series A, 5.125%, 6/01/24
4,000 Puerto Rico Public Finance Corporation, Commonwealth Appropriation 2/12 at 100.00 BBB+ 4,088,000
Bonds, 2002 Series E, 5.500%, 8/01/29
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 41.7%
2,000 New Jersey Economic Development Authority, Special Facilities Revenue 11/10 at 101.00 B+ 1,856,520
Bonds (Continental Airlines, Inc. Project), Series 2000, 7.000%,
11/15/30 (Alternative Minimum Tax)
3,105 New Jersey Turnpike Authority, Turnpike Revenue Bonds, Series 1991C, No Opt. Call A- 3,716,250
6.500%, 1/01/16
2,000 The Port Authority of New York and New Jersey, Special Project Bonds 12/02 at 102.00 BB 2,002,720
(Delta Air Lines, Inc. Project - LaGuardia Airport Passenger
Terminal), Series 1R, 6.950%, 6/01/08
4,000 The Port Authority of New York and New Jersey, Consolidated Bonds, 6/14 at 100.00 AAA 3,875,440
One Hundred Twenty Seventh Series, 5.125%, 6/15/37 (Alternative
Minimum Tax) (WI, settling 7/10/02)
The Port Authority of New York and New Jersey, Consolidated Bonds,
One Hundred Twenty Fifth Series:
3,000 5.000%, 10/15/26 4/12 at 101.00 AAA 2,976,840
7,000 5.000%, 4/15/32 4/12 at 101.00 AAA 6,894,930
1,000 The Port Authority of New York and New Jersey, Consolidated Bonds, 10/07 at 101.00 AAA 995,480
One Hundred Twenty First Series, 5.125%, 10/15/30
4,000 The Port Authority of New York and New Jersey, Special Project Bonds No Opt. Call AAA 4,763,960
(JFK International Air Terminal LLC Project), Series 6, 7.000%,
12/01/12 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 4.0%
2,500 Puerto Rico Infrastructure Financing Authority, Special Obligation 10/10 at 101.00 AAA 2,603,575
Bonds, 2000 Series A, 5.500%, 10/01/40
33
Nuveen New Jersey Dividend Advantage Municipal Fund 2 (NUJ) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES - 13.0%
$ 405 Pollution Control Financing Authority of Camden County, New Jersey, 12/02 at 101.00 B2 $ 405,158
Solid Waste Disposal and Resource Recovery System Revenue Bonds,
Series 1991B, 7.500%, 12/01/09 (Alternative Minimum Tax)
2,500 Guam Power Authority, Revenue Bonds, 1999 Series A, 10/09 at 101.00 AAA 2,515,275
5.250%, 10/01/34
2,500 New Jersey Economic Development Authority, Pollution Control Revenue No Opt. Call Baa1 2,537,200
Refunding Bonds (PSEG Power LLC Project), Series 2001A,
5.000%, 3/01/12
3,000 Puerto Rico Electric Power Authority, Power Revenue Bonds, 2002 7/12 at 101.00 AAA 3,015,270
Series II, 5.125%, 7/01/26
-----------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 3.8%
2,500 The Indianapolis Local Public Improvement Bond Bank, Indiana 7/12 at 100.00 AAA 2,482,950
(Waterworks Project), Series 2002A, 5.250%, 7/01/33
-----------------------------------------------------------------------------------------------------------------------------
$ 97,450 Total Investments (cost $97,784,423) - 152.1% 99,015,410
==========-------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 8.4%
4,100 New Jersey Economic Development Authority, Revenue Bonds VMIG-1 4,100,000
(Lawrenceville School Project), Series 2001, Variable Rate Demand
Obligations, 1.350%, 7/01/31+
1,400 New Jersey Economic Development Authority, Variable Rate Demand VMIG-1 1,400,000
Water Facilities Revenue Refunding Bonds (United Water New
Jersey, Inc. Project), 1996 Series A, 1.800%, 11/01/26+
-----------------------------------------------------------------------------------------------------------------------------
$ 5,500 Total Short-Term Investments (cost $5,500,000) 5,500,000
==========-------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - (7.5)% (4,861,999)
---------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (53.0)% (34,500,000)
---------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 65,153,411
===============================================================================================================
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call
or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
(WI) Security purchased on a when-issued basis.
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically based
on market conditions or a specified market index.
See accompanying notes to financial statements.
34
Nuveen Pennsylvania Investment Quality Municipal Fund (NQP)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
CAPITAL GOODS - 2.1%
$ 5,000 Pennsylvania Economic Development Financing Authority, Exempt 5/11 at 101.00 A3 $ 4,964,500
Facilities Revenue Bonds (Amtrak Project), Series 2001A, 6.375%,
11/01/41 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 5.5%
13,300 Pennsylvania Economic Development Financing Authority, Solid Waste No Opt. Call AA- 13,067,915
Disposal Revenue Bonds (Procter & Gamble Paper Project),
Series 2001, 5.375%, 3/01/31 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 20.2%
10,000 Allegheny County Higher Education Building Authority, Pennsylvania, 3/12 at 100.00 AA- 9,885,000
Revenue Bonds (Carnegie Mellon University), Series 2002,
5.125%, 3/01/32
2,000 Allegheny County Higher Education Building Authority, Pennsylvania, 9/08 at 102.00 BBB 1,891,420
College Revenue Bonds (Chatham College), Series 1998A,
5.250%, 9/01/18
2,000 Chester County Industrial Development Authority, Pennsylvania, 1/12 at 100.00 AAA 1,960,700
Educational Facilities Revenue Bonds (The Westtown School
Project), Series 2002, 5.000%, 1/01/26
3,000 Delaware County Authority, Pennsylvania, Haverford College Revenue 11/10 at 101.00 AA 3,179,340
Bonds, Series 2000, 5.750%, 11/15/29
1,000 The General Municipal Authority of the Borough of Harveys Lake, 11/09 at 100.00 A 1,035,580
Pennsylvania, College Revenue Bonds (College Misericordia
Project), Series 1999, 6.000%, 5/01/19
1,450 Indiana County Industrial Development Authority, Pennsylvania, 11/06 at 100.00 AAA 1,491,746
Revenue Bonds (The Student Cooperative Association, Inc. - Indiana
University of Pennsylvania Student Union Project), Series 1999A,
5.875%, 11/01/29
Indiana County Industrial Development Authority, Pennsylvania, Revenue
Bonds (The Student Cooperative Association, Inc. - Indiana University
of Pennsylvania Student Union Project), Series 1999B:
815 0.000%, 11/01/15 No Opt. Call AAA 428,902
815 0.000%, 11/01/16 No Opt. Call AAA 403,075
815 0.000%, 11/01/17 No Opt. Call AAA 378,062
815 0.000%, 11/01/18 No Opt. Call AAA 354,476
815 0.000%, 11/01/19 No Opt. Call AAA 331,787
2,750 Northeastern Pennsylvania Hospital and Education Authority, Luzerne 10/08 at 100.00 AAA 2,558,023
County, School Revenue Bonds (Wyoming Seminary Project),
Series 1998, 4.750%, 10/01/28
8,000 Pennsylvania Higher Education Assistance Agency, Capital Acquisition 11/11 at 100.00 Aaa 7,757,760
Revenue Refunding Bonds, Series 2001, 5.000%, 12/15/30
3,000 Pennsylvania Higher Education Assistance Agency, Student Loan 9/02 at 102.00 AAA 3,064,500
Revenue Bonds, 1992 Series C, 6.400%, 3/01/22
(Alternative Minimum Tax)
5,000 Pennsylvania Higher Educational Facilities Authority, College and 7/11 at 100.00 AA 4,999,950
University Revenue Bonds (Moravian College Project),
Series 2001, 5.375%, 7/01/31
8,445 Swarthmore Borough Authority, Pennsylvania, Swarthmore College 9/08 at 100.00 AA+ 8,238,351
Revenue Bonds, Series 1998, 5.000%, 9/15/28
330 The General Municipal Authority of the City of Wilkes-Barre, 12/02 at 102.00 N/R 340,065
Pennsylvania, College Misericordia Revenue Refunding Bonds,
Series 1992B, 7.750%, 12/01/12
35
Nuveen Pennsylvania Investment Quality Municipal Fund (NQP) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 5.1%
$ 1,600 Geisinger Authority, Montour County, Pennsylvania, Health System 8/08 at 101.00 AA $ 1,501,264
Revenue Bonds, Penn State Geisinger Health System, Series
1998A, 5.000%, 8/15/28
9,500 Pennsylvania Higher Educational Facilities Authority, UPMC Health 1/11 at 101.00 A+ 9,592,435
System Revenue Bonds, Series 2001A, 6.000%, 1/15/31
1,000 The Hospitals and Higher Education Facilities Authority of 11/03 at 102.00 BBB 1,005,330
Philadelphia, Pennsylvania, Hospital Revenue Bonds (Temple
University Hospital), Series 1993A, 6.625%, 11/15/23
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 0.4%
980 Urban Redevelopment Authority of Pittsburgh, Pennsylvania, 8/02 at 102.00 A2 997,023
Redevelopment Mortgage Revenue Bonds, 1992 Series C,
7.125%, 8/01/13 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 12.3%
6,515 Allegheny County Residential Finance Authority, Pennsylvania, Single No Opt. Call Aaa 1,165,273
Family Mortgage Revenue Bonds, 1994 Series Z, 0.000%, 5/01/27
(Alternative Minimum Tax)
905 Redevelopment Authority of the County of Berks, Pennsylvania, Senior No Opt. Call A+ 961,164
Single Family Mortgage Revenue Bonds, 1986 Series A, 8.000%,
12/01/17 (Alternative Minimum Tax)
2,000 Pennsylvania Housing Finance Agency, Single Family Mortgage Revenue 10/05 at 102.00 AA+ 2,106,080
Bonds, Series 1995-46, 6.200%, 10/01/14 (Alternative Minimum Tax)
1,000 Pennsylvania Housing Finance Agency, Single Family Mortgage Revenue 4/06 at 102.00 AA+ 1,030,610
Bonds, Series 1996-48, 6.150%, 4/01/25 (Alternative Minimum Tax)
5,725 Pennsylvania Housing Finance Agency, Single Family Mortgage Revenue 4/06 at 102.00 AA+ 5,977,129
Bonds, Series 1996-49, 6.450%, 4/01/25 (Alternative Minimum Tax)
220 Pennsylvania Housing Finance Agency, Single Family Mortgage Revenue 4/06 at 102.00 AA+ 229,629
Bonds, Series 1996-50B,6.350%, 10/01/27 (Alternative Minimum Tax)
5,000 Pennsylvania Housing Finance Agency, Single Family Mortgage Revenue 4/06 at 102.00 AA+ 5,187,400
Bonds, Series 1996-52B, 6.250%, 10/01/24 (Alternative Minimum Tax)
5,000 Pennsylvania Housing Finance Agency, Single Family Mortgage Revenue 10/07 at 101.50 AA+ 5,073,500
Bonds, Series 1997-59A, 5.750%, 10/01/23 (Alternative Minimum Tax)
2,215 Urban Redevelopment Authority of Pittsburgh, Pennsylvania, Mortgage 10/11 at 100.00 AAA 2,209,573
Revenue Bonds, 2001 Series B, 5.450%, 10/01/32
1,385 Urban Redevelopment Authority of Pittsburgh, Pennsylvania, Mortgage 4/06 at 102.00 AAA 1,427,575
Revenue Bonds, 1996 Series C, 6.550%, 4/01/28
(Alternative Minimum Tax)
1,085 Urban Redevelopment Authority of Pittsburgh, Pennsylvania, Mortgage 4/07 at 102.00 AAA 1,132,165
Revenue Bonds, 1997 Series A, 6.250%, 10/01/28
(Alternative Minimum Tax)
2,865 Urban Redevelopment Authority of Pittsburgh, Pennsylvania, Mortgage 10/02 at 101.00 AAA 2,900,583
Revenue Bonds, 1991 Series G, 7.050%, 4/01/23
(Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/OTHER - 2.3%
5,000 Pennsylvania Industrial Development Authority, Economic Development No Opt. Call AAA 5,576,450
Revenue Bonds, Series 2002, 5.500%, 7/01/12
-----------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 2.1%
3,225 Montgomery County Higher Education and Health Authority, Pennsylvania, 1/06 at 101.00 BBB 3,125,831
Mortgage Revenue Bonds (Waverly Heights Project),
Series 1996, 6.375%, 1/01/26
1,500 Philadelphia Authority for Industrial Development, Pennsylvania, 7/11 at 101.00 AAA 1,503,105
Revenue Bonds (The Philadelphia Corporation for the Aging
Project), Series 2001B, 5.250%, 7/01/26
335 The Hospitals and Higher Education Facilities Authority of 8/02 at 102.00 A+ 343,613
Philadelphia, Pennsylvania, Hospital Revenue Bonds (Children's
Seashore House), Series 1992A, 7.000%, 8/15/03
36
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 31.9%
$ 3,550 Allegheny County, Pennsylvania, General Obligation Bonds, Series 52, 5/11 at 100.00 AAA $ 3,601,156
5.250%, 11/01/23
3,120 Allegheny County, Pennsylvania, General Obligation Refunding Bonds, 5/11 at 100.00 AAA 3,203,023
Series C-53, 5.250%, 11/01/20
2,000 Canon-McMillan School District, Washington County, Pennsylvania, No Opt. Call AAA 547,720
General Obligation Bonds, Series 2001A, 0.000%, 12/01/25
Carlisle Area School District, Cumberland County, Pennsylvania,
General Obligation Bonds, Series 2002:
1,915 4.750%, 3/01/20 3/12 at 100.00 Aaa 1,868,331
5,760 5.000%, 3/01/22 3/12 at 100.00 Aaa 5,761,786
2,000 Claysburg Kimmel School District, Blair County, Pennsylvania, General 1/09 at 100.00 AAA 1,936,460
Obligation Refunding Bonds, Series 2002, 5.000%, 1/15/31
4,600 Garnet Valley School District, Delaware County, Pennsylvania, General 8/11 at 100.00 Aaa 4,535,324
Obligation Bonds, Series 2001A, 5.000%, 2/15/25
Redevelopment Authority of the City of Harrisburg, Dauphin County,
Pennsylvania, Guaranteed Revenue Bonds, Series 1998B:
2,750 0.000%, 5/01/24 5/16 at 68.04 AAA 802,340
2,750 0.000%, 11/01/24 5/16 at 66.30 AAA 780,038
5,160 0.000%, 5/01/25 5/16 at 64.55 AAA 1,417,246
6,275 Hempfield Area School District, Westmoreland County, Pennsylvania, 2/12 at 100.00 AAA 6,612,093
General Obligation Bonds, Series 2002, 5.375%, 2/15/18
Mckeesport Area School District, Allegheny County, Pennsylvania,
General Obligation Bonds, Series 1999C:
3,430 0.000%, 10/01/23 No Opt. Call AAA 1,077,878
3,380 0.000%, 10/01/24 No Opt. Call AAA 992,909
3,420 0.000%, 10/01/25 No Opt. Call AAA 946,553
2,340 0.000%, 10/01/26 No Opt. Call AAA 611,395
2,340 0.000%, 10/01/27 No Opt. Call AAA 576,927
2,340 0.000%, 10/01/29 No Opt. Call AAA 513,794
7,500 Montgomery County, Pennsylvania, General Obligation Bonds, Series 7/09 at 100.00 Aaa 7,484,925
1999, 5.000%, 7/15/24
1,700 City of Philadelphia, Pennsylvania, General Obligation Bonds, Series 3/11 at 100.00 AAA 1,642,880
2000, 5.000%, 9/15/31
3,400 Philadelphia School District, Pennsylvania, General Obligation Bonds, 8/12 at 100.00 AAA 3,646,024
Series 2002B, 5.625%, 8/01/18
15,000 Philadelphia School District, Pennsylvania, General Obligation Bonds, 9/05 at 101.00 AAA 15,299,400
Series 1995B, 5.500%, 9/01/25
3,000 Pittsburgh School District, Allegheny County, Pennsylvania, General No Opt. Call AAA 3,338,220
Obligation Refunding Bonds, Series 2002A, 5.500%, 9/01/15
(WI, settling 7/10/02)
6,100 Plum Borough School District, Allegheny County, Pennsylvania, General 9/11 at 100.00 AAA 6,132,696
Obligation Bonds, Series 2001, 5.250%, 9/15/30
1,590 Red Lion Area School District, York County, Pennsylvania, General 10/11 at 100.00 Aaa 1,597,521
Obligation Bonds, Series 2001, 5.000%, 4/15/20
1,465 Stroudsburg Area School District, Monroe County, Pennsylvania, General 4/12 at 100.00 AAA 1,494,945
Obligation Bonds, Series 2001A, 5.000%, 4/01/18
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 22.8%
5,500 Port Authority of Allegheny County, Pennsylvania, Special 3/11 at 101.00 AAA 5,361,235
Transportation Revenue Bonds, Series 2001, 5.000%, 3/01/29
5,000 Delaware Valley Regional Finance Authority, Pennsylvania, Local No Opt. Call Aa2 5,632,850
Government Revenue Bonds, Series 2002, 5.750%, 7/01/17
9,225 Pennsylvania Intergovernmental Cooperation Authority, Special Tax 6/09 at 100.00 AAA 8,760,706
Revenue Refunding Bonds (City of Philadelphia Funding Program),
Series 1999, 4.750%, 6/15/23
3,500 Pennsylvania Turnpike Commission, Oil Franchise Tax Senior Revenue 12/08 at 100.00 AAA 3,277,225
Bonds, Series 1998A, 4.750%, 12/01/27
5,150 Pennsylvania Turnpike Commission, Registration Fee Revenue Bonds, 7/11 at 101.00 AAA 4,915,726
Series 2001, 5.000%, 7/15/41
37
Nuveen Pennsylvania Investment Quality Municipal Fund (NQP) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED (continued)
$ 10,935 Philadelphia Authority for Industrial Development, Pennsylvania, 10/11 at 101.00 AAA $ 10,964,196
Lease Revenue Bonds, Series 2001B, 5.250%, 10/01/30
5,000 Pittsburgh and Allegheny County Public Auditorium Authority, 8/09 at 101.00 AAA 4,874,150
Pennsylvania, Regional Asset District Sales Tax Revenue Bonds,
Series 1999, 5.000%, 2/01/29
1,090 Urban Redevelopment Authority of Pittsburgh, Pennsylvania, Tax 5/09 at 100.00 A2 1,141,121
Increment Bonds (Center Triangle Tax Increment Financing District -
PNC Bank Corp. Project), Series 1999A, 6.100%, 5/01/19
10,250 Southeastern Pennsylvania Transportation Authority, Special Revenue 3/09 at 101.00 AAA 9,525,018
Bonds, Series 1999A, 4.750%, 3/01/29
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 9.9%
2,000 Lehigh-Northampton Airport Authority, Pennsylvania, Lehigh Valley 5/10 at 100.00 Aaa 2,113,480
Airport System, Airport Revenue Bonds, Series 2000A, 6.000%,
5/15/30 (Alternative Minimum Tax)
735 Pennsylvania Turnpike Commission, Pennsylvania Turnpike Revenue 12/02 at 102.00 AAA 750,751
Bonds, 1992 Series O, 5.500%, 12/01/17
2,500 Pennsylvania Turnpike Commission, Pennsylvania Turnpike Revenue 12/11 at 101.00 AAA 2,424,300
Bonds, 2001 Series R, 5.000%, 12/01/30
5,000 City of Philadelphia, Pennsylvania, Airport Revenue Bonds 6/11 at 101.00 AAA 4,937,550
(Philadelphia Airport System), Series 2001B, 5.250%, 6/15/31
(Alternative Minimum Tax)
Philadelphia Authority for Industrial Development, Pennsylvania,
Airport Revenue Bonds (Philadelphia Airport System Project),
Series 1998A:
7,315 5.000%, 7/01/23 (Alternative Minimum Tax) 7/08 at 101.00 AAA 7,088,381
3,085 5.125%, 7/01/28 (Alternative Minimum Tax) 7/08 at 101.00 AAA 3,006,271
3,250 The Philadelphia Parking Authority, Pennsylvania, Airport Parking 9/09 at 101.00 AAA 3,253,250
Revenue Bonds, Series 1999, 5.250%, 9/01/29
-----------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 8.9%
1,355 Bensalem Township School District, Bucks County, Pennsylvania, 7/06 at 100.00 AAA 1,512,234
General Obligation Bonds, Series 1996, 5.850%, 7/15/12
(Pre-refunded to 7/15/06)
2,000 Hampton Township School District, Allegheny County, Pennsylvania, 11/04 at 100.00 AAA 2,219,480
General Obligation Bonds, Series 1995, 6.750%, 11/15/21
(Pre-refunded to 11/15/04)
3,000 The Pittsburgh Water and Sewer Authority, Pennsylvania, Water and No Opt. Call AAA 3,205,590
Sewer System Revenue Refunding Bonds, Series 1986,
7.625%, 9/01/04
2,000 Sto-Rox School District, Allegheny County, Pennsylvania, General 12/10 at 100.00 AAA 2,292,620
Obligation Bonds, Series 2000, 5.800%, 6/15/30
(Pre-refunded to 12/15/10)
3,000 Warrington Township Municipal Authority, Bucks County, Pennsylvania, 11/15 at 100.00 AAA 3,765,750
Water and Sewer Revenue Bonds, Series 1991, 7.100%, 12/01/21
(Pre-refunded to 11/15/15)
5,450 The Municipal Authority of the Borough of West View, Allegheny No Opt. Call AAA 7,673,055
County, Pennsylvania, Special Obligation Bonds, Series 1985A,
9.500%, 11/15/14
645 The General Municipal Authority of the City of Wilkes-Barre, 12/02 at 102.00 N/R*** 674,231
Pennsylvania, College Misericordia Revenue Refunding Bonds,
Series 1992A, 7.750%, 12/01/12 (Pre-refunded to 12/01/02)
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES - 7.1%
2,900 Carbon County Industrial Development Authority, Pennsylvania, Resource No Opt. Call BBB- 3,129,767
Recovery Revenue Refunding Bonds (Panther Creek Partners Project),
2000 Series, 6.650%, 5/01/10 (Alternative Minimum Tax)
325 Greater Lebanon Refuse Authority, Lebanon County, Pennsylvania, 11/02 at 100.00 A- 330,096
Solid Waste Revenue Bonds, Series 1992, 7.000%, 11/15/04
4,000 Lehigh County Industrial Development Authority, Pollution Control 8/05 at 102.00 AAA 4,291,200
Revenue Refunding Bonds (Pennsylvania Power and Light Company
Project), 1995 Series A, 6.150%, 8/01/29
5,500 Montgomery County Industrial Development Authority, Pennsylvania, 1/03 at 100.00 AA- 5,636,015
Resource Recovery Revenue Bonds (Montgomery County Project),
Series 1989, 7.500%, 1/01/12
3,700 York County Industrial Development Authority, Pennsylvania, 3/12 at 101.00 Baa1 3,580,823
Pollution Control Revenue Refunding Bonds (PSEG Power Project),
Series 2001A, 5.500%, 9/01/20
38
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 23.1%
$ 5,000 Delaware County Industrial Development Authority, Pennsylvania, Water 10/12 at 100.00 AAA $ 5,013,250
Facilities Revenue Bonds (Philadelphia Water Company Project),
Series 2001, 5.350%, 10/01/31
Delaware County Regional Water Quality Control Authority,
Pennsylvania, Sewer Revenue Bonds, Series 2001A:
5,325 5.100%, 5/01/20 11/11 at 100.00 AAA 5,389,752
1,465 5.100%, 5/01/21 11/11 at 100.00 AAA 1,476,266
Erie City Water Authority, Erie County, Pennsylvania, Water Revenue
Bonds, Series 2001A:
2,670 0.000%, 12/01/23 No Opt. Call AAA 826,285
5,000 5.200%, 12/01/30 12/11 at 100.00 AAA 4,990,200
3,000 Luzerne County Industrial Development Authority, Exempt Facilities 10/02 at 102.00 A3 3,076,620
Revenue Refunding Bonds (Pennsylvania Gas and Water Company
Project), 1992 Series A, 7.200%, 10/01/17 (Alternative Minimum Tax)
3,550 Luzerne County Industrial Development Authority, Exempt Facilities 12/02 at 102.00 A3 3,649,365
Revenue Bonds (Pennsylvania Gas and Water Company Project),
1992 Series B, 7.125%, 12/01/22 (Alternative Minimum Tax)
5,000 Luzerne County Industrial Development Authority, Exempt Facilities 12/04 at 102.00 AAA 5,598,100
Revenue Refunding Bonds (Pennsylvania Gas and Water Company
Project), 1994 Series A, 7.000%, 12/01/17
(Alternative Minimum Tax)
City of Philadelphia, Pennsylvania, Water and Wastewater Revenue
Bonds, Series 2001A:
5,525 5.375%, 11/01/20 11/12 at 100.00 AAA 5,728,762
10,750 5.000%, 11/01/31 11/12 at 100.00 AAA 10,388,260
20,000 The Pittsburgh Water and Sewer Authority, Pennsylvania, Water and No Opt. Call AAA 5,153,200
Sewer System First Lien Revenue Bonds, Series 1998B,
0.000%, 9/01/26
12,625 Municipal Authority of Westmoreland County, Pennsylvania, No Opt. Call AAA 3,939,631
Municipal Service Revenue Bonds, Series 1999A, 0.000%, 8/15/23
-----------------------------------------------------------------------------------------------------------------------------
$ 416,610 Total Investments (cost $356,489,881) - 153.7% 367,365,230
==========-------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 1.0%
$ 2,300 Allentown Commercial and Industrial Development Authority, Aa3 2,300,000
========== Pennsylvania, Variable Rate Demand
Revenue Bonds (Diocese of Allentown), Series 1999, 1.750%, 12/01/29+
---------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.5% 1,260,961
---------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (55.2)% (132,000,000)
---------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 238,926,191
===============================================================================================================
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call
or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
*** Securities are backed by an escrow or trust containing sufficient U.S.
Government or U.S. Government agency securities which ensures the timely
payment of principal and interest. Securities are normally considered to be
equivalent to AAA rated securities.
N/R Investment is not rated.
(WI) Security purchased on a when-issued basis.
+ Security has a maturity of more than one year, but has variable rate and
demand features which qualify it as a short-term security. The rate
disclosed is that currently in effect. This rate changes periodically based
on market conditions or a specified market index.
See accompanying notes to financial statements.
39
Nuveen Pennsylvania Premium Income Municipal Fund 2 (NPY)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
BASIC MATERIALS - 0.2%
$ 500 Erie County Industrial Development Authority, Pennsylvania, 9/10 at 101.00 BBB $ 504,155
Environmental Improvement Revenue Refunding Bonds, 2000
eries B, 6.000%, 9/01/16 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
CAPITAL GOODS - 1.6%
2,000 New Morgan Industrial Development Authority, Pennsylvania, Solid 4/04 at 102.00 BB- 1,855,540
Waste Disposal Revenue Bonds (New Morgan Landfill Company, Inc.
Project), Series 1994, 6.500%, 4/01/19 (Alternative Minimum Tax)
2,000 Pennsylvania Economic Development Financing Authority, Exempt 5/11 at 101.00 A3 1,977,520
Facilities Revenue Bonds (Amtrak Project), Series 2001A, 6.250%,
11/01/31 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS - 1.5%
4,500 Pennsylvania Economic Development Financing Authority, Exempt 11/08 at 102.00 N/R 3,601,440
Facilities Revenue Bonds (National Gypsum Project), Series 1997B,
6.125%, 11/01/27
-----------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 14.0%
2,045 Allegheny County Higher Education Building Authority, Pennsylvania, 5/09 at 102.00 A 1,979,417
College Revenue Bonds (Thiel College), Series 1999A,
5.375%, 11/15/29
3,000 Chester County Health and Educational Facilities Authority, 10/08 at 102.00 BBB- 2,859,840
Pennsylvania, College Revenue Bonds (Immaculata College),
Series 1998, 5.625%, 10/15/27
1,350 Lancaster Higher Education Authority, Pennsylvania, College Revenue 4/03 at 100.00 AAA 1,384,223
Bonds (Franklin and Marshall College Project), Series 1993,
5.700%, 4/15/13
10,000 Pennsylvania Higher Education Assistance Agency, Student Loan 7/03 at 102.00 AAA 10,245,000
Revenue Bonds, 1988 Series D, 6.050%, 1/01/19
(Alternative Minimum Tax)
1,000 Pennsylvania Higher Educational Facilities Authority, LaSalle 5/08 at 101.00 Aaa 1,009,940
University Revenue Bonds, Series 1998, 5.250%, 5/01/23
2,100 Pennsylvania Higher Educational Facilities Authority (Commonwealth of 6/10 at 100.00 AA 2,200,254
Pennsylvania), Philadelphia University Revenue Bonds, Series 2000,
6.000%, 6/01/29
4,615 Pennsylvania Higher Educational Facilities Authority, Widner 7/03 at 102.00 AAA 4,761,296
University Revenue Bonds, 1993 Series A, 5.250%, 7/15/11
1,500 Pennsylvania Higher Educational Facilities Authority, Temple 7/11 at 101.00 AAA 1,449,810
University Revenue Bonds, First Series 2001, 5.000%, 7/15/31
3,340 State Public School Building Authority, Commonwealth of Pennsylvania, 3/03 at 100.00 AAA 3,420,561
College Revenue Bonds (Northampton County Area Community
College Project), Series 1993U, 5.850%, 3/15/15
2,500 West Cornwall Township Municipal Authority, Pennsylvania, College 12/11 at 100.00 BBB+ 2,531,550
Revenue Bonds (Elizabethtown College Project), Series 2001,
5.900%, 12/15/18
845 The General Municipal Authority of the City of Wilkes-Barre, 12/02 at 102.00 N/R 870,773
Pennsylvania, College Misericordia Revenue Refunding Bonds,
Series 1992B, 7.750%, 12/01/12
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 16.9%
8,500 Allegheny County Hospital Development Authority, Pennsylvania, 5/06 at 102.00 AAA 8,804,640
Hospital Revenue Bonds (South Hills Health System), Series
1996A, 5.875%, 5/01/26
14,000 Allegheny County Hospital Development Authority, Pennsylvania, Health 4/07 at 102.00 AAA 14,304,640
Center Revenue Bonds (University of Pittsburgh Medical Center
System), Series 1997A, 5.625%, 4/01/27
7,900 Montgomery County Higher Education and Health Authority, 1/09 at 101.00 AAA 7,655,890
Pennsylvania, Revenue Bonds (Pottstown Healthcare Corporation),
Series 1998, 5.000%, 1/01/27
485 Montgomery County Higher Education and Health Authority, 6/03 at 102.00 AAA 501,771
Pennsylvania, Hospital Revenue Bonds (Abington Memorial
Hospital), Series 1993A, 6.000%, 6/01/22
40
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE (continued)
$ 4,700 Pennsylvania Higher Educational Facilities Authority, University of 1/06 at 101.00 A $ 4,745,167
Pennsylvania Health Services Revenue Bonds, Series 1996A,
5.750%, 1/01/22
City of Pottsville Hospital Authority, Pennsylvania, Hospital
Revenue Bonds (The Pottsville Hospital and Warne Clinic), Series
1998:
2,000 5.500%, 7/01/18 7/08 at 100.00 BBB- 1,752,260
2,000 5.625%, 7/01/24 7/08 at 100.00 BBB- 1,707,460
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 6.6%
4,345 Bucks County Redevelopment Authority, Pennsylvania, Second Lien 8/03 at 100.00 Baa2 4,301,072
Multifamily Mortgage Revenue Bonds (Section 8 Assisted Country
Commons Apartments), Series 1993A, 6.200%, 8/01/14
(Alternative Minimum Tax)
2,000 Delaware County Industrial Development Authority, Pennsylvania, No Opt. Call AAA 2,030,000
Multifamily Housing Revenue Bonds (Darby Townhouses Project),
Series 2002A, 5.500%, 4/01/32 (Alternative Minimum Tax)
(Mandatory put 4/01/22)
1,615 Luzerne County Housing Corporation, Pennsylvania, Mortgage Revenue 9/03 at 100.00 Aaa 1,623,075
Refunding Bonds, Series 1993 (FHA-Insured Mortgage Loan)
(Freeland Apartments - Section 8 Assisted Project), 6.125%, 7/15/23
5,000 Pennsylvania Housing Finance Agency, Rental Housing Refunding Bonds, 7/02 at 102.00 AAA 5,118,550
Issue 1992, 6.400%, 7/01/12 (Pre-refunded to 7/25/02)
2,345 Swissvale Housing Development Corporation (An Instrumentality of the 7/03 at 100.00 Aa2 2,356,326
Allegheny County Housing Authority), Pennsylvania, Multifamily
Mortgage Revenue Refunding Bonds (FHA-Insured Mortgage
Loan - Section 8 Assisted Swissvale Project), Series 1993C,
6.100%, 7/01/22
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 12.1%
1,340 Allegheny County Residential Finance Authority, Pennsylvania, Single 11/10 at 100.00 Aaa 1,379,155
Family Mortgage Revenue Bonds, 2000 Series II-2, 5.900%,
11/01/32 (Alternative Minimum Tax)
2,000 Pennsylvania Housing Finance Agency, Single Family Mortgage 10/03 at 102.00 AA+ 2,038,800
Revenue Bonds, Series 37A, 5.450%, 10/01/17
1,120 Pennsylvania Housing Finance Agency, Single Family Mortgage No Opt. Call AA+ 1,251,253
Revenue Bonds, Series 1996-47, 6.750%, 10/01/06
(Alternative Minimum Tax)
2,815 Pennsylvania Housing Finance Agency, Single Family Mortgage 4/06 at 102.00 AA+ 2,920,112
Revenue Bonds, Series 1996-51, 6.375%, 4/01/28
(Alternative Minimum Tax)
2,380 Pennsylvania Housing Finance Agency, Single Family Mortgage 10/06 at 102.00 AA+ 2,476,057
Revenue Bonds, Series 1997-54A, 6.150%, 10/01/22
(Alternative Minimum Tax)
Pennsylvania Housing Finance Agency, Single Family Mortgage
Revenue Bonds, Series 1997-56A:
1,500 6.050%, 10/01/16 (Alternative Minimum Tax) 4/07 at 102.00 AA+ 1,579,230
4,000 6.150%, 10/01/27 (Alternative Minimum Tax) 4/07 at 102.00 AA+ 4,149,280
1,620 Pennsylvania Housing Finance Agency, Single Family Mortgage 4/07 at 101.50 AA+ 1,655,575
Revenue Bonds, Series 1997-58A, 5.950%, 10/01/28
(Alternative Minimum Tax)
1,645 Pennsylvania Housing Finance Agency, Single Family Mortgage 10/07 at 101.50 AA+ 1,744,473
Revenue Bonds, Series 1997-59A, 5.700%, 4/01/17
(Alternative Minimum Tax)
1,190 Pennsylvania Housing Finance Agency, Single Family Mortgage 6/08 at 101.50 AA+ 1,204,113
Revenue Bonds, Series 1998-62A, 5.500%, 10/01/22
(Alternative Minimum Tax)
1,500 Pittsburgh Urban Redevelopment Authority, Pennsylvania, Mortgage 4/06 at 102.00 AAA 1,549,125
Revenue Bonds, 1996 Series C, 6.500%, 10/01/23
(Alternative Minimum Tax)
Pittsburgh Urban Redevelopment Authority, Pennsylvania, Mortgage
Revenue Bonds, 1997 Series A:
845 6.150%, 10/01/16 (Alternative Minimum Tax) 4/07 at 102.00 AAA 895,007
765 6.200%, 10/01/21 (Alternative Minimum Tax) 4/07 at 102.00 AAA 801,307
1,375 Pittsburgh Urban Redevelopment Authority, Pennsylvania, Mortgage 4/03 at 102.00 AAA 1,417,708
Revenue Bonds, 1992 Series D, 6.500%, 4/01/17
2,460 Pittsburgh Urban Redevelopment Authority, Pennsylvania, Mortgage 4/03 at 102.00 AAA 2,528,339
Revenue Bonds, 1992 Series C-1, 6.800%, 10/01/25
(Alternative Minimum Tax)
615 Pittsburgh Urban Redevelopment Authority, Pennsylvania, Mortgage 4/04 at 102.00 AAA 641,919
Revenue Bonds, 1994 Series B, 6.950%, 10/01/10
(Alternative Minimum Tax)
41
Nuveen Pennsylvania Premium Income Municipal Fund 2 (NPY) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/OTHER - 4.5%
$ 2,165 Montgomery County Industrial Development Authority, Pennsylvania, 6/03 at 102.00 N/R $ 2,161,558
Health Facilities Revenue Bonds (Emergency Care Research
Institute, ECRI), Series of 1993, 6.850%, 6/01/13
Pennsylvania Industrial Development Authority, Economic Development
Revenue Bonds, Series 1994:
2,000 7.000%, 7/01/06 No Opt. Call AAA 2,306,140
1,550 7.000%, 1/01/07 No Opt. Call AAA 1,792,978
1,000 7.000%, 7/01/07 No Opt. Call AAA 1,171,780
2,750 Pennsylvania Industrial Development Authority, Economic Development 7/12 at 101.00 AAA 2,970,550
Revenue Bonds, Series 2002, 5.500%, 7/01/17
-----------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 4.6%
1,230 Pennsylvania Economic Development Financing Authority, Revenue 6/08 at 100.00 BBB 895,046
Bonds, Series 1998A (Northwestern Human Services, Inc. Project),
5.250%, 6/01/28
Pennsylvania Economic Development Financing Authority, Revenue
Bonds (Dr. Gertrude A. Barber Center Inc.), Series 2000:
1,000 6.150%, 12/01/20 8/02 at 100.00 AA 1,000,740
2,000 5.900%, 12/01/30 12/10 at 100.00 AA 2,066,200
Philadelphia Authority for Industrial Development, Pennsylvania,
Healthcare Facilities Revenue Bonds (Paul's Run), Series 1998A:
1,350 5.750%, 5/15/18 5/08 at 102.00 N/R 1,249,263
1,650 5.875%, 5/15/28 5/08 at 102.00 N/R 1,487,327
4,000 Philadelphia Hospital and Higher Educational Facilities Authority, 8/03 at 102.00 BBB+ 4,132,120
Pennsylvania, Revenue Refunding Bonds (Philadelphia MR
Project), Series 1992, 5.625%, 8/01/04
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 9.2%
Chichester School District, Delaware County, Pennsylvania, General
Obligation Bonds, Series 1999:
3,125 0.000%, 3/01/23 No Opt. Call AAA 1,031,219
3,125 0.000%, 3/01/24 No Opt. Call AAA 969,156
3,125 0.000%, 3/01/25 No Opt. Call AAA 914,156
2,110 Fayette County, Pennsylvania, General Obligation Bonds, Series 2000, 11/10 at 100.00 AAA 2,197,206
5.625%, 11/15/28
Harrisburg Redevelopment Authority, Dauphin County, Pennsylvania,
Guaranteed Revenue Bonds, Series 1998B:
1,750 0.000%, 5/01/22 5/16 at 75.56 AAA 583,590
2,750 0.000%, 11/01/22 5/16 at 73.64 AAA 892,045
2,750 0.000%, 5/01/23 5/16 at 71.71 AAA 859,293
2,750 0.000%, 11/01/23 5/16 at 69.88 AAA 835,643
4,305 County of Montgomery, Pennsylvania, General Obligation Bonds, Series 10/06 at 100.00 Aaa 4,395,577
1996B, 5.375%, 10/15/21
2,000 The School District of Philadelphia, Pennsylvania, General Obligation No Opt. Call AAA 2,318,000
Refunding Bonds, Series 1995A, 6.250%, 9/01/09
3,500 The School District of Philadelphia, Pennsylvania, General Obligation 4/09 at 100.00 AAA 3,192,980
Bonds, Series 1999A, 4.500%, 4/01/23
1,700 Pine-Richland School District, Allegheny County, Pennsylvania, General 9/11 at 100.00 AAA 1,664,011
Obligation Refunding Bonds, Series 2001, 5.000%, 9/01/29
1,535 Stroudsburg Area School District, Monroe County, Pennsylvania, General 4/12 at 100.00 AAA 1,554,402
Obligation Bonds, Series 2001A, 5.000%, 4/01/19
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 9.9%
4,060 Delaware Valley Regional Finance Authority, Pennsylvania, Local 4/06 at 100.00 AAA 4,346,839
Government Revenue Bonds, Series 1996A, 6.000%, 4/15/26
9,000 Pittsburgh and Allegheny County Public Auditorium Authority, 8/09 at 101.00 AAA 7,984,980
Pennsylvania, Hotel Room Excise Tax Revenue Bonds, Series
1999, 4.500%, 2/01/29
11,725 Southeastern Pennsylvania Transportation Authority, Special Revenue 3/09 at 101.00 AAA 10,895,691
Bonds, Series 1999A, 4.750%, 3/01/29
42
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 9.5%
$ 2,300 County of Allegheny, Pennsylvania, Airport Revenue Refunding Bonds 1/08 at 101.00 AAA $ 2,346,322
(Pittsburgh International Airport), Series 1997A, 5.250%, 1/01/16
(Alternative Minimum Tax)
3,575 Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, 2001 12/11 at 101.00 AAA 3,466,749
Series R, 5.000%, 12/01/30
10,000 Philadelphia Authority for Industrial Development, Pennsylvania, 7/11 at 101.00 AAA 9,892,200
Airport Revenue Bonds (Philadelphia Airport System Project),
Series 2001A, 5.250%, 7/01/28 (Alternative Minimum Tax)
6,525 Sports and Exhibition Authority of Pittsburgh and Allegheny County, 12/06 at 100.00 Aaa 6,550,448
Pennsylvania, Parking Revenue Bonds, Series 2001A,
5.350%, 12/01/26
-----------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 22.7%
3,000 Allegheny County Hospital Development Authority, Pennsylvania, 11/02 at 100.00 AAA 3,049,080
Health Center Revenue Bonds (Presbyterian University Health
System, Inc. Project), Series 1992A, 6.250%, 11/01/23
(Pre-refunded to 11/01/02)
2,000 Bangor Area School District, Northampton County, Pennsylvania, 3/06 at 100.00 AAA 2,189,500
General Obligation Bonds, Series 1996B, 5.500%, 3/15/18
(Pre-refunded to 3/15/06)
2,500 Bensalem Township School District, Bucks County, Pennsylvania, 7/06 at 100.00 AAA 2,792,475
General Obligation Bonds, Series 1996, 5.875%, 7/15/16
(Pre-refunded to 7/15/06)
17,895 The Harrisburg Authority, Dauphin County, Pennsylvania, Tax-Exempt 9/07 at 100.00 AAA 20,042,042
Revenue Bonds (The City of Harrisburg Project), Series II of 1997,
5.625%, 9/15/22 (Pre-refunded to 9/15/07)
3,500 Hollidaysburg Sewer Authority, Pennsylvania, Guaranteed Sewer 1/03 at 100.00 AAA 3,581,690
Revenue Bonds, Series 1993, 6.100%, 1/01/23
(Pre-refunded to 1/01/03)
1,500 Ligonier Valley School District, Westmoreland County, Pennsylvania, 3/04 at 100.00 AAA 1,598,940
General Obligation Bonds, Series 1994, 6.000%, 3/01/23
(Pre-refunded to 3/01/04)
2,015 Montgomery County Higher Education and Health Authority, 6/03 at 102.00 AAA 2,137,411
Pennsylvania, Hospital Revenue Bonds (Abington Memorial
Hospital), Series 1993A, 6.000%, 6/01/22 (Pre-refunded to 6/01/03)
1,445 Pennsylvania Higher Educational Facilities Authority, College and No Opt. Call Aaa 1,760,342
University Revenue Bonds, 9th Series, 7.625%, 7/01/15
1,005 Philadelphia Hospitals and Higher Educational Facilities Authority, 5/04 at 102.00 AAA 1,098,586
Pennsylvania, Community College Revenue Bonds (Community
College of Philadelphia), Series 1994, 6.100%, 5/01/10
(Pre-refunded to 5/01/04)
City of Philadelphia, Pennsylvania, Water and Wastewater Revenue
Bonds, Series 1993:
955 5.750%, 6/15/13 (Pre-refunded to 6/15/03) 6/03 at 102.00 AAA 1,012,290
1,135 5.500%, 6/15/14 (Pre-refunded to 6/15/03) 6/03 at 102.00 AAA 1,200,376
Philadelphia Hospitals and Higher Educational Facilities
Authority, Pennsylvania, Hospital Revenue Bonds (Presbyterian
Medical Center of Philadelphia), Series 1993:
1,000 6.500%, 12/01/11 12/03 at 102.00 AAA 1,165,000
3,690 6.650%, 12/01/19 12/03 at 102.00 AAA 4,482,317
1,750 Pine-Richland School District, Allegheny County, Pennsylvania, General 9/03 at 100.00 AAA 1,841,998
Obligation Bonds, Series 1993A, 6.100%, 9/01/18
(Pre-refunded to 9/01/03)
2,500 Schuylkill Valley School District, Berks County, Pennsylvania, General 4/03 at 100.00 AAA 2,586,100
Obligation Bonds, Series 1993, 5.850%, 4/15/13
(Pre-refunded to 4/15/03)
1,650 The Municipal Authority of the Borough of West View, Allegheny County, No Opt. Call AAA 2,323,035
Pennsylvania, Special Obligation Bonds, Series 1985A,
9.500%, 11/15/14
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES - 17.9%
8,000 Beaver County Industrial Development Authority, Pennsylvania, Exempt 6/08 at 102.00 AAA 8,039,120
Facilities Revenue Bonds (Shippingport Project), 1998 Series A,
5.375%, 6/01/28 (Alternative Minimum Tax)
3,935 Carbon County Industrial Development Authority, Pennsylvania, Resource No Opt. Call BBB- 4,246,770
Recovery Revenue Refunding Bonds (Panther Creek Partners Project),
2000 Series, 6.650%, 5/01/10 (Alternative Minimum Tax)
7,590 Indiana County Industrial Development Authority, Pennsylvania, 5/07 at 102.00 AAA 7,950,070
Pollution Control Revenue Bonds (Metropolitan Edison Company
Project), 1997 Series A, 5.950%, 5/01/27 (Alternative Minimum Tax)
2,000 Indiana County Industrial Development Authority, Pennsylvania, 6/12 at 101.00 Baa1 1,952,500
Pollution Control Revenue Refunding Bonds (PSEG Power LLC
Project), Series 2001A, 5.850%, 6/01/27 (Alternative Minimum Tax)
43
Nuveen Pennsylvania Premium Income Municipal Fund 2 (NPY) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES (continued)
$ 13,500 Lehigh County Industrial Development Authority, Pollution Control 11/02 at 102.00 AAA $ 13,966,830
Revenue Refunding Bonds (Pennsylvania Power and Light
Company Project), 1992 Series A, 6.400%, 11/01/21
5,750 City of Philadelphia, Pennsylvania, Gas Works Revenue Bonds, 1998 7/09 at 101.00 AAA 5,596,303
General Ordinance, Second Series, 5.000%, 7/01/29
-----------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 17.6%
2,000 Allegheny County Sanitary Authority, Pennsylvania, Sewer Revenue 12/10 at 101.00 AAA 2,059,900
Bonds, Series 2000, 5.500%, 12/01/30
4,000 Bucks County Industrial Development Authority, Pennsylvania, Water 3/12 at 100.00 AAA 4,072,480
Facility Revenue Bonds (Pennsylvania Suburban Water Company
Project), Series 2002, 5.550%, 9/01/32 (Alternative Minimum Tax)
1,975 Delaware County Industrial Development Authority, Pennsylvania, 12/02 at 102.00 AAA 2,021,630
Water Facilities Revenue Refunding Bonds (Philadelphia Suburban
Water Company Project), Series 1992, 6.500%, 6/01/10
7,350 Luzerne County Industrial Development Authority, Pennsylvania, Exempt 10/02 at 102.00 A3 7,537,719
Facilities Revenue Refunding Bonds (Pennsylvania Gas and Water
Company Project), 1992 Series A, 7.200%, 10/01/17
(Alternative Minimum Tax)
4,500 Luzerne County Industrial Development Authority, Pennsylvania, Exempt 12/02 at 102.00 A3 4,625,955
Facilities Revenue Bonds (Pennsylvania Gas and Water Company
Project), 1992 Series B, 7.125%, 12/01/22 (Alternative
Minimum Tax)
3,360 Mercer County Industrial Development Authority, Pennsylvania, Water 7/10 at 100.00 AAA 3,557,904
Facilities Revenue Bonds (Consumers Pennsylvania Water
Company - Shenango Valley Division Project), Series 2000,
6.000%, 7/01/30 (Alternative Minimum Tax)
5,500 Northumberland County Industrial Development Authority, Pennsylvania, 10/03 at 102.00 N/R 5,612,915
Exempt Facilities Revenue Bonds (Roaring Creek Water Company
Project), Series 1993, 6.375%, 10/15/23 (Alternative Minimum Tax)
City of Philadelphia, Pennsylvania, Water and Wastewater Revenue
Bonds, Series 1995:
3,000 6.750%, 8/01/05 No Opt. Call AAA 3,370,320
2,730 6.250%, 8/01/10 No Opt. Call AAA 3,172,451
City of Philadelphia, Pennsylvania, Water and Wastewater Revenue
Bonds, Series 1993:
1,380 5.750%, 6/15/13 6/03 at 102.00 AAA 1,451,222
1,165 5.500%, 6/15/14 6/03 at 102.00 AAA 1,208,450
10,000 The Pittsburgh Water and Sewer Authority, Pennsylvania, Water and No Opt. Call AAA 2,296,100
Sewer System First Lien Revenue Bonds, Series 1998B, 0.000%, 9/01/28
-----------------------------------------------------------------------------------------------------------------------------
$ 361,035 Total Investments (cost $331,147,144) - 148.8% 347,507,653
==========-------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.8% 4,128,258
---------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (50.6)% (118,100,000)
---------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 233,535,911
===============================================================================================================
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call
or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
N/R Investment is not rated.
See accompanying notes to financial statements.
44
Nuveen Pennsylvania Dividend Advantage Municipal Fund (NXM)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
CAPITAL GOODS - 4.0%
$ 2,000 Pennsylvania Economic Development Financing Authority, Exempt 5/11 at 101.00 A3 $ 1,977,520
Facilities Revenue Bonds (Amtrak Project), Series 2001A, 6.250%,
11/01/31 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER CYCLICALS - 4.9%
3,000 Pennsylvania Economic Development Financing Authority, Exempt 11/08 at 102.00 N/R 2,400,960
Facilities Revenue Bonds (National Gypsum Project), Series 1997B,
6.125%, 11/01/27
-----------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 6.9%
3,450 Pennsylvania Economic Development Financing Authority, Solid Waste No Opt. Call AA- 3,389,798
Disposal Revenue Bonds (Procter & Gamble Paper Project),
Series 2001, 5.375%, 3/01/31 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 26.8%
2,250 Bucks County Industrial Development Authority, Pennsylvania, Revenue 9/11 at 100.00 Aaa 2,213,325
Bonds (George School Project), Series of 2001, 5.125%, 9/15/31
1,825 Delaware County Authority, Pennsylvania, College Revenue Refunding 10/11 at 100.00 BBB- 1,833,158
Bonds (Neumann College), Series 2001, 6.000%, 10/01/31
2,370 Montgomery County Industrial Development Authority, Pennsylvania, 8/07 at 100.00 AAA 2,384,078
Revenue Bonds (The Hill School Project), Series of 1997,
5.350%, 8/15/27
1,500 Pennsylvania Higher Educational Facilities Authority, College and 7/11 at 100.00 AA 1,499,985
University Revenue Bonds (Moravian College Project),
Series 2001, 5.375%, 7/01/31
3,000 The Pennsylvania State University, Refunding Bonds, Series 2002, No Opt. Call AA 3,280,410
5.250%, 8/15/14
2,000 West Cornwall Township Municipal Authority, Pennsylvania, College 12/11 at 100.00 BBB+ 2,013,560
Revenue Bonds (Elizabethtown College Project), Series 2001,
6.000%, 12/15/27
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 22.3%
2,500 Chester County Health and Educational Facilities Authority, 5/08 at 101.00 AA- 2,429,700
Pennsylvania, Health System Revenue Bonds (Jefferson Health
System), Series 1997B, 5.375%, 5/15/27
2,500 Geisinger Authority, Montour County, Pennsylvania, Health System 8/08 at 101.00 AA 2,345,725
Revenue Bonds (Penn State Geisinger Health System),
Series 1998A, 5.000%, 8/15/28
2,900 Pennsylvania Higher Educational Facilities Authority, UPMC Health 1/11 at 101.00 A+ 2,928,217
System Revenue Bonds, Series 2001A, 6.000%, 1/15/31
1,000 Washington County Hospital Authority, Pennsylvania, Revenue Bonds 6/12 at 101.00 A3 1,011,730
(Monongahela Valley Hospital Project), Series 2002,
5.500%, 6/01/17
2,250 West Shore Area Hospital Authority, Cumberland County, Pennsylvania, 1/12 at 100.00 BBB+ 2,263,590
Hospital Revenue Bonds (Holy Spirit Hospital of the Sisters of
Christian Charity Project), Series 2001, 6.250%, 1/01/32
-----------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 4.7%
2,305 Allegheny County Residential Finance Authority, Pennsylvania, Single 11/08 at 102.00 Aaa 2,297,624
Family Mortgage Revenue Bonds, 1998 Series DD2, 5.400%,
11/01/29 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/OTHER - 2.7%
1,250 Pennsylvania Industrial Development Authority, Economic Development 7/12 at 101.00 AAA 1,350,250
Revenue Bonds, Series 2002, 5.500%, 7/01/17
-----------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 10.1%
2,100 Lancaster County Hospital Authority, Pennsylvania, Health Center 12/11 at 100.00 A- 2,103,045
Revenue Bonds (Willow Valley Retirement Communities Project),
Series 2001, 5.875%, 6/01/31
2,875 Philadelphia Authority for Industrial Development, Pennsylvania, 7/11 at 101.00 AAA 2,860,136
Revenue Bonds (The Philadelphia Corporation for the Aging
Project), Series 2001B, 5.250%, 7/01/31
45
Nuveen Pennsylvania Dividend Advantage Municipal Fund (NXM) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 47.3%
$ 2,415 Central Bucks School District, Bucks County, Pennsylvania, General 5/12 at 100.00 Aaa $ 2,578,979
Obligation Bonds, Series 2002, 5.500%, 5/15/18
Lake-Lehman School District, Luzerne County, Pennsylvania, General
Obligation Bonds, Series 2001:
1,315 0.000%, 4/01/25 No Opt. Call AAA 372,329
1,315 0.000%, 4/01/26 No Opt. Call AAA 351,434
1,105 Oxford Area School District, Chester County, Pennsylvania, General 2/12 at 100.00 AAA 1,187,400
Obligation Bonds, 2001 Series A, 5.500%, 2/15/17
2,000 Commonwealth of Pennsylvania, General Obligation Bonds, Second 9/11 at 101.00 AA 2,130,760
Series of 2001, 5.000%, 9/15/13 (DD, settling 7/01/02)
2,500 Philadelphia School District, Pennsylvania, General Obligation Bonds, 8/12 at 100.00 AAA 2,680,900
Series 2002B, 5.625%, 8/01/18
3,000 Pittsburgh School District, Allegheny County, Pennsylvania, General No Opt. Call AAA 3,342,780
Obligation Refunding Bonds, Series 2002A, 5.500%, 9/01/14
(WI, settling 7/10/02)
3,700 Plum Borough School District, Allegheny County, Pennsylvania, General 9/11 at 100.00 AAA 3,719,832
Obligation Bonds, Series 2001, 5.250%, 9/15/30
9,270 Reading School District, Berks County, Pennsylvania, General 7/11 at 54.58 AAA 3,086,168
Obligation Bonds, Series 2001A, 0.000%, 1/15/22
2,625 Sto-Rox School District, Allegheny County, Pennsylvania, General 12/11 at 100.00 AAA 2,610,011
Obligation Refunding Bonds, Series 2001, 5.125%, 12/15/29
1,230 Stroudsburg Area School District, Monroe County, Pennsylvania, 4/12 at 100.00 AAA 1,284,477
General Obligation Bonds, Series 2001A, 5.000%, 4/01/15
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 14.8%
250 Port Authority of Allegheny County, Pennsylvania, Special 3/11 at 101.00 AAA 243,693
Transportation Revenue Bonds, Series 2001, 5.000%, 3/01/29
3,500 Pennsylvania Turnpike Commission, Oil Franchise Tax Senior Revenue 12/08 at 100.00 AAA 3,277,225
Bonds, Series 1998A, 4.750%, 12/01/27
1,500 Philadelphia Redevelopment Authority, Pennsylvania, Revenue Bonds 4/12 at 100.00 AAA 1,586,595
(City of Philadelphia Neighborhood Transformation Initiative),
Series 2002A, 5.500%, 4/15/19
2,250 Pittsburgh and Allegheny County Public Auditorium Authority, 8/09 at 101.00 AAA 2,193,368
Pennsylvania, Regional Asset District Sales Tax Revenue Bonds,
Series 1999, 5.000%, 2/01/29
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 8.0%
1,750 Philadelphia Authority for Industrial Development, Pennsylvania, 7/11 at 101.00 AAA 1,731,135
Airport Revenue Bonds (Philadelphia Airport System Project),
Series 2001A, 5.250%, 7/01/28 (Alternative Minimum Tax)
2,210 Sports and Exhibition Authority of Pittsburgh and Allegheny County, 12/06 at 100.00 Aaa 2,216,785
Pennsylvania, Parking Revenue Bonds, Series 2001A,
5.375%, 12/01/30
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES - 4.5%
2,240 City of Philadelphia, Pennsylvania, Gas Works Revenue Bonds, 7/03 at 102.00 BBB 2,242,641
Fourteenth Series, 6.375%, 7/01/26
-----------------------------------------------------------------------------------------------------------------------------
$ 85,250 Total Investments (cost $75,301,132) - 157.0% 77,419,323
==========-------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - (6.3)% (3,112,842)
---------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (50.7)% (25,000,000)
---------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 49,306,481
===============================================================================================================
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call
or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
N/R Investment is not rated.
(DD) Security purchased on a delayed delivery basis.
(WI) Security purchased on a when-issued basis.
See accompanying notes to financial statements.
46
Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 (NVY)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
BASIC MATERIALS - 4.0%
$ 2,190 Bucks County Industrial Development Authority, Pennsylvania, No Opt. Call BBB+ $ 2,205,943
Environmental Improvement Revenue Bonds (USX Corp. Project),
Series 1995, 5.400%, 11/01/17 (Mandatory put 11/01/11)
-----------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 17.7%
700 Allegheny County Higher Education Building Authority, Pennsylvania, 9/02 at 100.00 AA- 700,175
Revenue Bonds (Carnegie Mellon University), Series 2002,
5.450%, 3/01/27
1,500 Allegheny County Higher Education Building Authority, Commonwealth No Opt. Call Baa3 1,512,660
of Pennsylvania, College Revenue Refunding Bonds (Robert Morris
College), Series 1998A, 6.000%, 5/01/28
2,000 Pennsylvania Higher Educational Facilities Authority, Revenue Bonds 7/11 at 101.00 AAA 1,933,080
(Temple University), First Series 2001, 5.000%, 7/15/31
5,000 The Pennsylvania State University, Series 2002 Refunding Bonds, No Opt. Call AA 5,479,050
5.250%, 8/15/12
-----------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 9.3%
2,000 Chester County Health and Educational Facilities Authority, 5/08 at 101.00 AA- 1,943,760
Pennsylvania, Health System Revenue Bonds (Jefferson Health
System), Series 1997B, 5.375%, 5/15/27
1,000 Philadelphia Hospitals and Higher Educational Facilities Authority, 11/03 at 102.00 BBB 1,005,330
Pennsylvania, Hospital Revenue Bonds (Temple University Hospital),
Series 1993A, 6.625%, 11/15/23
1,450 Washington County Hospital Authority, Pennsylvania, Revenue Bonds 6/12 at 101.00 A3 1,528,764
(Monongahela Valley Hospital Project), Series 2002, 6.250%, 6/01/22
600 West Shore Area Hospital Authority, Cumberland County, Pennsylvania, 1/12 at 100.00 BBB+ 603,624
Hospital Revenue Bond (Holy Spirit Hospital of the Sisters of
Christian Charity Project), Series 2001, 6.250%, 1/01/32
-----------------------------------------------------------------------------------------------------------------------------
INDUSTRIAL/OTHER - 7.8%
4,000 Pennsylvania Industrial Development Authority, Economic Development 7/12 at 101.00 AAA 4,253,080
Revenue Bonds, Series 2002, 5.500%, 7/01/19
-----------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 3.9%
965 Allegheny County Residential Finance Authority, Pennsylvania, 5/12 at 102.00 Aaa 978,809
Healthcare Facilities Revenue Bonds (GNMA Collateralized -
Lemington Home for the Aged Project), Series 2002A,
5.750%, 5/20/37
1,155 Bucks County Industrial Development Authority, Pennsylvania, Revenue 10/12 at 101.00 BBB+ 1,159,089
Bonds (Pennswood Village Project), Series 2002A, 6.000%, 10/01/34
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 56.6%
2,000 Adams County, Pennsylvania, General Obligation Bonds, Series 2001, 5/11 at 100.00 AAA 2,064,360
5.500%, 11/15/26
2,500 Ambridge Area School District, Beaver County, Pennsylvania, General 11/12 at 100.00 AAA 2,511,975
Obligation Bonds, Series 2002B, 5.125%, 5/01/23
1,740 Butler Area School District, Butler County, Pennsylvania, General 10/12 at 100.00 AAA 1,777,010
Obligation Bonds, Series 2002A, 5.375%, 10/01/26
765 Butler Area School District, Butler County, Pennsylvania, General 10/12 at 100.00 AAA 780,048
Obligation Bonds, Series 2002B, 5.375%, 10/01/29
2,150 Fairview School District, Erie County, Pennsylvania, General 8/11 at 100.00 AAA 2,137,853
Obligation Bonds, Series 2001B, 5.125%, 2/01/29
Greensburg Salem School District, Westmoreland County, Pennsylvania,
General Obligation Refunding Bonds, Series 2002:
725 5.375%, 9/15/15 9/12 at 100.00 AAA 782,913
1,000 5.375%, 9/15/16 9/12 at 100.00 AAA 1,071,370
4,280 Lehigh County, Pennsylvania, General Obligation Bonds, Series 2001, 11/11 at 100.00 Aa3 4,457,064
5.000%, 11/15/15
47
Nuveen Pennsylvania Dividend Advantage Municipal Fund 2 (NVY) (continued)
Portfolio of Investments June 30, 2002
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
Luzerne County, Pennsylvania, General Obligation Bonds, Series 2002B:
$ 1,100 0.000%, 11/15/21 11/12 at 57.97 Aaa $ 364,199
1,500 0.000%, 11/15/22 11/12 at 54.51 Aaa 464,175
1,450 0.000%, 11/15/23 11/12 at 51.25 Aaa 420,558
5,000 Commonwealth of Pennsylvania, General Obligation Bonds, Second 9/11 at 101.00 AA 5,240,950
Series of 2001, 5.000%, 9/15/15
2,000 Philadelphia School District, Pennsylvania, General Obligation Bonds, 2/12 at 100.00 AAA 2,053,120
Series 2002A, 5.500%, 2/01/31
3,170 Philadelphia School District, Pennsylvania, General Obligation Bonds, 8/12 at 100.00 AAA 3,399,381
Series 2002B, 5.625%, 8/01/18
3,000 Commonwealth of Puerto Rico, Public Improvement General Obligation No Opt. Call AAA 3,246,690
Bonds, 2002 Series A, 5.500%, 7/01/29
-----------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 37.7%
5,000 Delaware Valley Regional Finance Authority, Pennsylvania, Local No Opt. Call Aa2 5,632,850
Government Revenue Bonds, Series 2002, 5.750%, 7/01/17
2,000 Grove City Area Hospital Authority, Mercer County, Pennsylvania, 3/12 at 100.00 AAA 2,021,620
Woodland Place Project Revenue Bonds, County Guaranteed,
Series 2002, 5.400%, 3/01/31
5,000 Harrisburg Parking Authority, Pennsylvania, Guaranteed Revenue 9/11 at 100.00 Aaa 4,983,900
Refunding Bonds, Series 2001J, 5.000%, 9/01/22
2,945 Pennsylvania Turnpike Commission, Registration Fee Revenue Bonds, 7/11 at 101.00 AAA 3,042,214
Series 2001, 5.500%, 7/15/33
2,000 Philadelphia Authority for Industrial Development, Pennsylvania, Lease 10/11 at 101.00 AAA 1,983,660
Revenue Bonds, Series 2001B, 5.125%, 10/01/26
Philadelphia Redevelopment Authority, Pennsylvania, Revenue Bonds
(City of Philadelphia Neighborhood Transformation Initiative),
Series 2002A:
1,000 5.500%, 4/15/18 4/12 at 100.00 AAA 1,065,800
1,750 5.500%, 4/15/22 4/12 at 100.00 AAA 1,827,333
-----------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 1.1%
625 Pennsylvania Turnpike Commission, Pennsylvania, Turnpike Revenue 12/11 at 101.00 AAA 606,075
Bonds, 2001 Series R, 5.000%, 12/01/30
-----------------------------------------------------------------------------------------------------------------------------
UTILITIES - 4.8%
2,600 City of Philadelphia, Pennsylvania, Gas Works Revenue Bonds, 7/03 at 102.00 BBB 2,603,067
Fourteenth Series, 6.375%, 7/01/26
-----------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 8.4%
4,500 Bucks County Industrial Development Authority, Pennsylvania, Water 3/12 at 100.00 AAA 4,581,540
Facility Revenue Bonds (Pennsylvania Suburban Water Company
Project), Series 2002, 5.550%, 9/01/32 (Alternative Minimum Tax)
-----------------------------------------------------------------------------------------------------------------------------
$ 82,360 Total Investments (cost $80,783,160) - 151.3% 82,423,089
==========-------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.0% 557,505
---------------------------------------------------------------------------------------------------------------
Preferred Shares, at Liquidation Value - (52.3)% (28,500,000)
---------------------------------------------------------------------------------------------------------------
Net Assets Applicable to Common Shares - 100% $ 54,480,594
===============================================================================================================
* Optional Call Provisions (not covered by the report of independent
auditors): Dates (month and year) and prices of the earliest optional call
or redemption. There may be other call provisions at varying prices at
later dates.
** Ratings (not covered by the report of independent auditors): Using the
higher of Standard & Poor's or Moody's rating.
See accompanying notes to financial statements.
48
Statement of Assets and Liabilities June 30, 2002
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments in municipal securities, at market value $461,027,530 $276,683,728 $139,937,394 $ 99,015,410
Temporary investments in short-term securities, at
amortized cost, which approximates market value 500,000 -- -- 5,500,000
Cash 46,267 566,313 231,948 --
Receivables:
Interest 8,242,653 4,932,596 2,552,619 1,404,976
Investments sold 9,191,300 80,000 -- --
Other assets 22,561 24,831 10,925 9,621
------------------------------------------------------------------------------------------------------------------------------------
Total assets 479,030,311 282,287,468 142,732,886 105,930,007
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Cash overdraft -- -- -- 1,756,367
Payable for investments purchased 10,294,113 2,112,631 -- 3,872,436
Accrued expenses:
Management fees 243,324 146,857 40,713 28,657
Organization and offering costs -- -- 8,800 145,563
Other 117,040 149,291 81,009 125,006
Preferred share dividends payable 21,013 9,154 7,227 3,781
------------------------------------------------------------------------------------------------------------------------------------
Common share dividends payable 1,546,928 876,943 464,837 344,786
Total liabilities 12,222,418 3,294,876 602,586 6,276,596
------------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at liquidation value 162,000,000 91,600,000 48,000,000 34,500,000
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $304,807,893 $187,392,592 $ 94,130,300 $ 65,153,411
====================================================================================================================================
Common shares outstanding 20,221,279 12,012,930 6,547,000 4,507,008
====================================================================================================================================
Net asset value per Common share outstanding
(net assets applicable to Common shares,
divided by Common shares outstanding) $ 15.07 $ 15.60 $ 14.38 $ 14.46
====================================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
------------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 202,213 $ 120,129 $ 65,470 $ 45,070
Paid-in surplus 284,916,680 171,406,368 92,887,605 63,920,453
Undistributed (Over-distribution of) net investment income 1,768,070 1,610,542 184,283 (42,886)
Accumulated net realized gain (loss) from investments 1,392,822 (1,746,745) (292,160) (213)
Net unrealized appreciation of investments 16,528,108 16,002,298 1,285,102 1,230,987
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $304,807,893 $187,392,592 $ 94,130,300 $ 65,153,411
====================================================================================================================================
Authorized shares:
Common 200,000,000 200,000,000 Unlimited Unlimited
Preferred 1,000,000 1,000,000 Unlimited Unlimited
====================================================================================================================================
See accompanying notes to financial statements.
49
Statement of Assets and Liabilities June 30, 2002 (continued)
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments in municipal securities, at market value $367,365,230 $347,507,653 $77,419,323 $82,423,089
Temporary investments in short-term securities, at
amortized cost, which approximates market value 2,300,000 -- -- --
Cash 916,797 237,095 1,390,564 84,515
Receivables:
Interest 5,165,907 5,329,779 1,051,181 1,032,837
Investments sold -- 90,000 270,137 --
Other assets 27,517 35,858 10,429 854
------------------------------------------------------------------------------------------------------------------------------------
Total assets 375,775,451 353,200,385 80,141,634 83,541,295
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Cash overdraft -- -- -- --
Payable for investments purchased 3,312,865 -- 5,479,319 --
Accrued expenses:
Management fees 194,005 183,983 21,308 23,816
Organization and offering costs -- -- 8,800 122,025
Other 91,436 174,502 79,978 123,335
Preferred share dividends payable 15,454 17,057 3,422 6,791
Common share dividends payable 1,235,500 1,188,932 242,326 284,734
------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 4,849,260 1,564,474 5,835,153 560,701
------------------------------------------------------------------------------------------------------------------------------------
Preferred shares, at liquidation value 132,000,000 118,100,000 25,000,000 28,500,000
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $238,926,191 $233,535,911 $49,306,481 $54,480,594
====================================================================================================================================
Common shares outstanding 16,256,593 15,747,462 3,296,957 3,722,013
====================================================================================================================================
Net asset value per Common share outstanding
(net assets applicable to Common shares,
divided by Common shares outstanding) $ 14.70 $ 14.83 $ 14.96 $ 14.64
====================================================================================================================================
NET ASSETS APPLICABLE TO COMMON SHARES CONSIST OF:
------------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 162,566 $ 157,475 $ 32,970 $ 37,220
Paid-in surplus 230,045,239 215,268,132 46,706,877 52,770,956
Undistributed (Over-distribution of) net investment income 847,477 2,445,025 272,643 (52,819)
Accumulated net realized gain (loss) from investments (3,004,440) (695,230) 175,800 85,308
Net unrealized appreciation of investments 10,875,349 16,360,509 2,118,191 1,639,929
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common shares $238,926,191 $233,535,911 $49,306,481 $54,480,594
====================================================================================================================================
Authorized shares:
Common Unlimited Unlimited Unlimited Unlimited
Preferred Unlimited Unlimited Unlimited Unlimited
====================================================================================================================================
See accompanying notes to financial statements.
50
Statement of Operations Year Ended June 30, 2002
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)*
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $26,001,671 $14,943,169 $7,482,471 $ 809,679
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 2,950,814 1,776,556 918,507 132,509
Preferred shares - auction fees 405,000 229,000 120,000 10,634
Preferred shares - dividend disbursing agent fees 30,000 30,000 10,000 1,233
Shareholders' servicing agent fees and expenses 67,310 34,275 2,154 951
Custodian's fees and expenses 113,661 70,622 56,065 14,223
Directors'/Trustees' fees and expenses 3,989 2,318 2,169 539
Professional fees 19,575 15,673 10,603 7,157
Shareholders' reports - printing and mailing expenses 54,184 25,966 25,392 7,526
Stock exchange listing fees 24,330 24,277 239 --
Investor relations expense 68,243 40,608 3,671 --
Other expenses 33,046 18,377 10,413 1,077
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and expense reimbursement 3,770,152 2,267,672 1,159,213 175,849
Custodian fee credit (34,856) (17,221) (37,135) (3,945)
Expense reimbursement -- -- (424,886) (61,158)
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 3,735,296 2,250,451 697,192 110,746
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 22,266,375 12,692,718 6,785,279 698,933
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS
Net realized gain (loss) from investments 2,008,530 1,446,786 (285,894) (213)
Change in net unrealized appreciation (depreciation) of investments (2,377,570) 1,407,496 (122,252) 1,230,987
------------------------------------------------------------------------------------------------------------------------------------
Net gain (loss) from investments (369,040) 2,854,282 (408,146) 1,230,774
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From and in excess of net investment income (2,560,820) (1,417,848) (855,272) (52,247)
From accumulated net realized gains from investments -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares from distributions
to Preferred shareholders (2,560,820) (1,417,848) (855,272) (52,247)
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable to Common shares
from operations $19,336,515 $14,129,152 $5,521,861 $1,877,460
====================================================================================================================================
* For the period March 26, 2002 (commencement of operations) through June 30,
2002.
See accompanying notes to financial statements.
51
Statement of Operations Year Ended June 30, 2002 (continued)
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)**
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $20,727,615 $19,736,458 $4,096,705 $ 664,264
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 2,355,150 2,232,565 478,991 111,042
Preferred shares - auction fees 330,000 295,250 62,500 8,784
Preferred shares - dividend disbursing agent fees 30,000 30,000 10,000 1,233
Shareholders' servicing agent fees and expenses 77,023 63,722 4,123 1,093
Custodian's fees and expenses 156,988 89,280 34,722 10,547
Directors'/Trustees' fees and expenses 2,968 3,435 1,640 425
Professional fees 17,596 16,650 9,978 7,133
Shareholders' reports - printing and mailing expenses 46,210 37,230 15,851 7,498
Stock exchange listing fees 24,319 24,277 178 --
Investor relations expense 57,671 52,031 1,962 --
Other expenses 22,334 21,099 9,299 986
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit and expense reimbursement 3,120,259 2,865,539 629,244 148,741
Custodian fee credit (40,909) (23,365) (8,409) (1,354)
Expense reimbursement -- -- (221,072) (51,250)
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 3,079,350 2,842,174 399,763 96,137
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 17,648,265 16,894,284 3,696,942 568,127
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS) FROM INVESTMENTS
Net realized gain (loss) from investments 2,590,369 1,191,174 226,686 85,308
Change in net unrealized appreciation (depreciation) of investments (1,250,135) 3,570,190 1,011,994 1,639,929
------------------------------------------------------------------------------------------------------------------------------------
Net gain (loss) from investments 1,340,234 4,761,364 1,238,680 1,725,237
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO PREFERRED SHAREHOLDERS
From and in excess of net investment income (2,216,547) (1,898,830) (436,152) (51,479)
From accumulated net realized gains from investments -- -- (9,362) --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to Common shares from distributions
to Preferred shareholders (2,216,547) (1,898,830) (445,514) (51,479)
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable to Common shares
from operations $16,771,952 $19,756,818 $4,490,108 $2,241,885
====================================================================================================================================
** For the period March 25, 2002 (commencement of operations) through June 30,
2002.
See accompanying notes to financial statements.
52
Statement of Changes in Net Assets
NEW JERSEY INVESTMENT QUALITY (NQJ) NEW JERSEY PREMIUM INCOME (NNJ) NEW JERSEY DIVIDEND ADVANTAGE (NXJ)
----------------------------------- ------------------------------- -----------------------------------
FOR THE
PERIOD 3/28/01
(COMMENCEMENT
OF OPERATIONS)
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED THROUGH
6/30/02 6/30/01 6/30/02 6/30/01 6/30/02 6/30/01
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 22,266,375 $ 23,745,271 $ 12,692,718 $ 12,839,204 $ 6,785,279 $ 931,588
Net realized gain (loss)
from investments 2,008,530 610,427 1,446,786 (269,314) (285,894) (6,266)
Change in net unrealized appreciation
(depreciation) of investments (2,377,570) 10,985,354 1,407,496 12,204,840 (122,252) 1,407,354
Distributions to Preferred Shareholders:
From and in excess of net
investment income (2,560,820) (5,489,183) (1,417,848) (3,029,141) (855,272) (169,574)
From accumulated net realized gains
from investments -- -- -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable to
Common shares from operations 19,336,515 29,851,869 14,129,152 21,745,589 5,521,861 2,163,102
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From and in excess of net
investment income (18,508,380) (18,380,712) (10,187,469) (9,790,538) (5,578,064) (929,674)
From accumulated net realized gains
from investments -- -- -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (18,508,380) (18,380,712) (10,187,469) (9,790,538) (5,578,064) (929,674)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common shares:
Net proceeds from sale of shares -- -- -- -- -- 93,489,300
Net proceeds from shares
issued to shareholders due to
reinvestment of distributions 2,194,939 1,503,374 -- -- -- --
Preferred shares offering costs -- -- -- -- -- (636,500)
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable
to Common shares from capital
share transactions 2,194,939 1,503,374 -- -- -- 92,852,800
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares 3,023,074 12,974,531 3,941,683 11,955,051 (56,203) 94,086,228
Net assets applicable to Common
shares at the beginning of period 301,784,819 288,810,288 183,450,909 171,495,858 94,186,503 100,275
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $304,807,893 $301,784,819 $187,392,592 $183,450,909 $94,130,300 $94,186,503
====================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of period $ 1,768,070 $ 518,230 $ 1,610,542 $ 266,422 $ 184,283 $ (167,660)
====================================================================================================================================
See accompanying notes to financial statements.
53
Statement of Changes in Net Assets (continued)
NEW JERSEY
DIVIDEND ADVANTAGE 2 (NUJ) PENNSYLVANIA INVESTMENT QUALITY (NQP) PENNSYLVANIA PREMIUM INCOME 2 (NPY)
---------------------------- ------------------------------------ -----------------------------------
FOR THE PERIOD 3/26/02
(COMMENCEMENT OF OPERATIONS) YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
THROUGH 6/30/02 6/30/02 6/30/01 6/30/02 6/30/01
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 698,933 $ 17,648,265 $ 19,820,618 $ 16,894,284 $ 16,832,591
Net realized gain (loss) from investments (213) 2,590,369 (4,837,654) 1,191,174 1,159,672
Change in net unrealized appreciation
(depreciation) of investments 1,230,987 (1,250,135) 7,489,584 3,570,190 13,740,217
Distributions to Preferred Shareholders:
From and in excess of net
investment income (52,247) (2,216,547) (4,889,041) (1,898,830) (4,234,820)
From accumulated net realized gains
from investments -- -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable to
Common shares from operations 1,877,460 16,771,952 17,583,507 19,756,818 27,497,660
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From and in excess of net
investment income (689,572) (14,777,891) (14,691,950) (13,598,132) (12,445,233)
From accumulated net realized gains
from investments -- -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (689,572) (14,777,891) (14,691,950) (13,598,132) (12,445,233)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common shares:
Net proceeds from sale of shares 64,327,500 -- -- -- --
Net proceeds from shares
issued to shareholders due to
reinvestment of distributions 122 1,744,182 771,056 -- --
Preferred shares offering costs (462,374) -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable
to Common shares from capital
share transactions 63,865,248 1,744,182 771,056 -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares 65,053,136 3,738,243 3,662,613 6,158,686 15,052,427
Net assets applicable to Common
shares at the beginning of period 100,275 235,187,948 231,525,335 227,377,225 212,324,798
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $65,153,411 $238,926,191 $235,187,948 $233,535,911 $227,377,225
====================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of period $ (42,886) $ 847,477 $ 132,323 $ 2,445,025 $ 784,663
====================================================================================================================================
See accompanying notes to financial statements.
54
PENNSYLVANIA PENNSYLVANIA
DIVIDEND ADVANTAGE (NXM) DIVIDEND ADVANTAGE 2 (NVY)
------------------------ --------------------------
FOR THE FOR THE
PERIOD 3/29/01 PERIOD 3/25/02
(COMMENCEMENT (COMMENCEMENT
YEAR ENDED OF OPERATIONS) OF OPERATIONS)
6/30/02 THROUGH 6/30/01 THROUGH 6/30/02
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 3,696,942 $ 450,226 $ 568,127
Net realized gain (loss) from investments 226,686 12 85,308
Change in net unrealized appreciation
(depreciation) of investments 1,011,994 1,115,126 1,639,929
Distributions to Preferred Shareholders:
From and in excess of net
investment income (436,152) (88,700) (51,479)
From accumulated net realized gains
from investments (9,362) -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable to
Common shares from operations 4,490,108 1,476,664 2,241,885
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO COMMON SHAREHOLDERS
From and in excess of net
investment income (2,880,695) (477,907) (569,467)
From accumulated net realized gains
from investments (41,536) -- --
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets applicable to
Common shares from distributions
to Common shareholders (2,922,231) (477,907) (569,467)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Common shares:
Net proceeds from sale of shares -- 47,014,826 53,105,925
Net proceeds from shares
issued to shareholders due to
reinvestment of distributions 15,496 -- 198
Preferred shares offering costs -- (390,750) (398,222)
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets applicable
to Common shares from capital
share transactions 15,496 46,624,076 52,707,901
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
applicable to Common shares 1,583,373 47,622,833 54,380,319
Net assets applicable to Common
shares at the beginning of period 47,723,108 100,275 100,275
------------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common
shares at the end of period $49,306,481 $47,723,108 $54,480,594
====================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of period $ 272,643 $ (116,381) $ (52,819)
====================================================================================================================================
See accompanying notes to financial statements.
55
Notes to Financial Statements
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The state Funds (the "Funds") covered in this report and their corresponding
stock exchange symbols are Nuveen New Jersey Investment Quality Municipal Fund,
Inc. (NQJ), Nuveen New Jersey Premium Income Municipal Fund, Inc. (NNJ), Nuveen
New Jersey Dividend Advantage Municipal Fund (NXJ), Nuveen New Jersey Dividend
Advantage Municipal Fund 2 (NUJ), Nuveen Pennsylvania Investment Quality
Municipal Fund (NQP), Nuveen Pennsylvania Premium Income Municipal Fund 2 (NPY),
Nuveen Pennsylvania Dividend Advantage Municipal Fund (NXM) and Nuveen
Pennsylvania Dividend Advantage Municipal Fund 2 (NVY). New Jersey Investment
Quality (NQJ), New Jersey Premium Income (NNJ), Pennsylvania Investment Quality
(NQJ) and Pennsylvania Premium Income (NPY) are traded on the New York Stock
Exchange while New Jersey Dividend Advantage (NXJ), New Jersey Dividend
Advantage 2 (NUJ), Pennsylvania Dividend Advantage (NXM) and Pennsylvania
Dividend Advantage 2 (NVY) are traded on the American Stock Exchange. Prior to
the commencement of operations of New Jersey Dividend Advantage (NXJ), New
Jersey Dividend Advantage 2 (NUJ), Pennsylvania Dividend Advantage (NXM) and
Pennsylvania Dividend Advantage 2 (NVY), each Fund had no operations other than
those related to organizational matters, the initial capital contribution of
$100,275 by Nuveen Advisory Corp. (the "Adviser"), a wholly owned subsidiary of
The John Nuveen Company, and the recording of the organization expenses
($15,000, $11,500, $15,000 and $11,500, respectively) and their reimbursement by
Nuveen Investments, also a wholly owned subsidiary of The John Nuveen Company.
Each Fund seeks to provide current income exempt from both regular federal and
designated state income taxes by investing primarily in a diversified portfolio
of municipal obligations issued by state and local government authorities within
a single state. The Funds are registered under the Investment Company Act of
1940 as closed-end management investment companies.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with
accounting principles generally accepted in the United States.
Securities Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Directors/Trustees. When
price quotes are not readily available (which is usually the case for municipal
securities), the pricing service establishes fair market value based on yields
or prices of municipal bonds of comparable quality, type of issue, coupon,
maturity and rating, indications of value from securities dealers and general
market conditions. If it is determined that market prices for a security are
unavailable or inappropriate, the Board of Directors/Trustees of the Funds may
establish a fair value for the security. Temporary investments in securities
that have variable rate and demand features qualifying them as short-term
securities are valued at amortized cost, which approximates market value.
Securities Transactions
Securities transactions are recorded on a trade date basis. Realized gains and
losses from such transactions are determined on the specific identification
method. Securities purchased or sold on a when-issued or delayed delivery basis
may have extended settlement periods. The securities so purchased are subject to
market fluctuation during this period. The Funds have instructed the custodian
to segregate assets in a separate account with a current value at least equal to
the amount of the when-issued and delayed delivery purchase commitments. At June
30, 2002, New Jersey Investment Quality (NQJ), New Jersey Dividend Advantage 2
(NUJ), Pennsylvania Investment Quality (NQP) and Pennsylvania Dividend Advantage
(NXM) had outstanding when-issued and/or delayed delivery purchase commitments
of $5,012,535, $3,872,436, $3,312,865 and $5,479,319, respectively. There were
no such outstanding purchase commitments in any of the other Funds.
Investment Income
Interest income, which includes the amortization of premiums and accretion of
discounts for financial reporting purposes, is recorded on an accrual basis.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to comply with the requirements of the Internal Revenue Code applicable
to regulated investment companies and to distribute all of its net investment
income to its shareholders. Therefore, no federal income tax provision is
required. Furthermore, each Fund intends to satisfy conditions which will enable
interest from municipal securities, which is exempt from regular federal and
applicable state and local income taxes, to retain such tax-exempt status when
distributed to the shareholders of the Funds. All monthly tax-exempt income
dividends paid during the period ended June 30, 2002, have been designated
Exempt Interest Dividends.
56
Dividends and Distributions to Shareholders
Tax-exempt net investment income is declared monthly as a dividend. Generally,
payment is made or reinvestment is credited to shareholder accounts on the first
business day after month-end. Net realized capital gains and/or market discount
from investment transactions, if any, are distributed to shareholders not less
frequently than annually. Furthermore, capital gains are distributed only to the
extent they exceed available capital loss carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized
capital gains and/or market discount, if any, are recorded on the ex-dividend
date. The amount and timing of such distributions are determined in accordance
with federal income tax regulations, which may differ from accounting principles
generally accepted in the United States. Accordingly, temporary
over-distributions as a result of these differences may occur and will be
classified as either distributions in excess of net investment income,
distributions in excess of net realized gains and/or distributions in excess of
net ordinary taxable income from investment transactions, where applicable.
Preferred Shares
The Funds have issued and outstanding $25,000 stated value Preferred shares.
Each Fund's Preferred shares are issued in one or more Series. The dividend rate
on each Series may change every seven days, as set by the auction agent. The
number of shares outstanding, by Series and in total, are as follows:
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)
------------------------------------------------------------------------------
Number of Shares:
Series M 3,200 -- -- --
Series T -- 624 1,920 --
Series W -- 1,440 -- 1,380
Series TH 2,000 1,600 -- --
Series F 1,280 -- -- --
------------------------------------------------------------------------------
Total 6,480 3,664 1,920 1,380
==============================================================================
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)
------------------------------------------------------------------------------
Number of Shares:
Series M -- 844 -- 1,140
Series T 880 -- 1,000 --
Series W 2,400 -- -- --
Series TH 2,000 2,080 -- --
Series F -- 1,800 -- --
------------------------------------------------------------------------------
Total 5,280 4,724 1,000 1,140
==============================================================================
Effective May 17, 2002, New Jersey Dividend Advantage 2 (NUJ) and Pennsylvania
Dividend Advantage 2 (NVY) issued 1,380 Series W and 1,140 Series M,
respectively, $25,000 stated value Preferred shares.
Derivative Financial Instruments
The Funds may invest in certain derivative financial instruments including
futures, forward, swap and option contracts, and other financial instruments
with similar characteristics. Although the Funds are authorized to invest in
such financial instruments, and may do so in the future, they did not make any
such investments during the period ended June 30, 2002.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by credits earned on each Fund's cash on deposit
with the bank. Such deposit arrangements are an alternative to overnight
investments.
Offering Costs
Nuveen Investments has agreed to pay all offering costs (other than the sales
load) that exceed $.03 per Common share for New Jersey Dividend Advantage (NXJ),
New Jersey Dividend Advantage 2 (NUJ), Pennsylvania Dividend Advantage (NXM) and
Pennsylvania Dividend Advantage 2 (NVY). New Jersey Dividend Advantage's (NXJ),
New Jersey Dividend Advantage 2's (NUJ), Pennsylvania Dividend Advantage's (NXM)
and Pennsylvania Dividend Advantage 2's (NVY) share of offering costs ($196,200,
$135,000, $98,667 and $111,450, respectively) were recorded as a reduction of
the proceeds from the sale of Common shares.
Costs incurred by New Jersey Dividend Advantage (NXJ), New Jersey Dividend
Advantage 2 (NUJ), Pennsylvania Dividend Advantage (NXM) and Pennsylvania
Dividend Advantage 2 (NVY) in connection with their offering of Preferred shares
($636,500, $462,374, $390,750 and $398,222, respectively) were recorded as a
reduction to paid-in surplus.
57
Notes to Financial Statements (continued)
Use of Estimates
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and the reported amounts of increases and
decreases in net assets applicable to Common shares from operations during the
reporting period. Actual results may differ from those estimates.
Change in Accounting Policy
As required, effective July 1, 2001, the following Funds have adopted the
provisions of the new AICPA Audit and Accounting Guide for Investment Companies
and began accreting taxable market discount on debt securities. Prior to July 1,
2001, the Funds did not accrete taxable market discount on debt securities until
they were sold. The cumulative effect of this accounting change had no impact on
the total net assets applicable to Common shares or the Common share net asset
values of the Funds, but resulted in an increase in the cost of securities and a
corresponding decrease in net unrealized appreciation based on securities held
by the following Funds on July 1, 2001, as follows:
NEW JERSEY NEW JERSEY NEW JERSEY PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND INVESTMENT PREMIUM DIVIDEND
QUALITY INCOME ADVANTAGE QUALITY INCOME 2 ADVANTAGE
(NQJ) (NNJ) (NXJ) (NQP) (NPY) (NXM)
------------------------------------------------------------------------------
$52,665 $256,719 $-- $61,327 $263,040 $8,929
==============================================================================
The Statement of Changes in Net Assets and Financial Highlights for the prior
periods have not been restated to reflect this change in presentation.
The effect of this change for the fiscal year ended June 30, 2002, was to
increase investment income with a corresponding decrease in net unrealized
appreciation as follows:
NEW JERSEY NEW JERSEY NEW JERSEY PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND INVESTMENT PREMIUM DIVIDEND
QUALITY INCOME ADVANTAGE QUALITY INCOME 2 ADVANTAGE
(NQJ) (NNJ) (NXJ) (NQP) (NPY) (NXM)
-------------------------------------------------------------------------------
$7,508 $35,192 $2,628 $42,575 $144,424 $45,427
===============================================================================
Classification and Measurement of Redeemable Securities
The Funds have adopted the classification requirement of EITF D-98,
Classification and Measurement of Redeemable Securities. EITFD-98 requires that
Preferred shares, at liquidation value, be presented separately in the Statement
of Assets and Liabilities. Accordingly, certain reclassifications have been made
to the financial statements and financial highlights for all prior periods
presented. The adoption of EITF D-98 had no impact on the Funds' Common share
net asset values.
58
2. FUND SHARES
Transactions in Common and Preferred shares were as follows:
NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT QUALITY (NQJ) PREMIUM INCOME (NNJ) DIVIDEND ADVANTAGE (NXJ)
------------------------ ---------------------- ---------------------------
FOR THE
PERIOD 3/28/01
(COMMENCEMENT
OF OPERATIONS)
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED THROUGH
6/30/02 6/30/01 6/30/02 6/30/01 6/30/02 6/30/01
----------------------------------------------------------------------------------------------------------
Common shares:
Shares sold -- -- -- -- -- 6,540,000
Shares issued to shareholders
due to reinvestment of
distributions 141,510 99,285 -- -- -- --
----------------------------------------------------------------------------------------------------------
141,510 99,285 -- -- -- 6,540,000
----------------------------------------------------------------------------------------------------------
Preferred shares sold -- -- -- -- -- 1,920
----------------------------------------------------------------------------------------------------------
NEW JERSEY PENNSYLVANIA PENNSYLVANIA
DIVIDEND ADVANTAGE 2 (NUJ) INVESTMENT QUALITY (NQP) PREMIUM INCOME 2 (NPY)
---------------------------- ------------------------ --------------------------
FOR THE PERIOD 3/26/02
(COMMENCEMENT OF OPERATIONS) YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
THROUGH 6/30/02 6/30/02 6/30/01 6/30/02 6/30/01
----------------------------------------------------------------------------------------------------------
Common shares:
Shares sold 4,500,000 -- -- -- --
Shares issued to shareholders
due to reinvestment of
distributions 8 115,618 51,443 -- --
----------------------------------------------------------------------------------------------------------
4,500,008 115,618 51,443 -- --
----------------------------------------------------------------------------------------------------------
Preferred shares sold 1,380 -- -- -- --
----------------------------------------------------------------------------------------------------------
PENNSYLVANIA PENNSYLVANIA
DIVIDEND ADVANTAGE (NXM) DIVIDEND ADVANTAGE 2 (NVY)
------------------------- ---------------------------
FOR THE
PERIOD 3/29/01
(COMMENCEMENT
OF OPERATIONS) FOR THE PERIOD 3/25/02
YEAR ENDED THROUGH (COMMENCEMENT OF OPERATIONS)
6/30/02 6/30/01 THROUGH 6/30/02
----------------------------------------------------------------------------------------------------------
Common shares:
Shares sold -- 3,288,900 3,715,000
Shares issued to shareholders
due to reinvestment of
distributions 1,057 -- 13
----------------------------------------------------------------------------------------------------------
1,057 3,288,900 3,715,013
----------------------------------------------------------------------------------------------------------
Preferred shares sold -- 1,000 1,140
----------------------------------------------------------------------------------------------------------
59
Notes to
Financial Statements (continued)
3. DISTRIBUTIONS TO COMMON SHAREHOLDERS
The Funds declared Common share dividend distributions from their tax-exempt net
investment income which were paid August 1, 2002, to shareholders of record on
July 15, 2002, as follows:
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)
------------------------------------------------------------------------------
Dividend per share $.0765 $.0730 $.0710 $.0765
==============================================================================
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)
------------------------------------------------------------------------------
Dividend per share $.0760 $.0755 $.0735 $.0765
==============================================================================
4. SECURITIES TRANSACTIONS
Purchases and sales (including maturities) of investments in long-term municipal
securities and short-term securities during the fiscal year ended June 30, 2002,
were as follows:
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)*
------------------------------------------------------------------------------------------------------------
Purchases:
Long-term municipal securities $117,421,398 $41,001,445 $10,395,913 $98,043,799
Short-term securities 23,500,000 2,000,000 -- 20,600,000
Sales and maturities:
Long-term municipal securities 98,703,550 38,641,382 11,177,890 253,088
Short-term securities 23,000,000 2,000,000 6,000,000 15,100,000
============================================================================================================
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)**
------------------------------------------------------------------------------------------------------------
Purchases:
Long-term municipal securities $142,446,721 $26,173,178 $40,436,748 $84,612,170
Short-term securities 20,100,000 7,800,000 -- 11,000,000
Sales and maturities:
Long-term municipal securities 121,439,442 24,403,629 35,856,962 3,916,135
Short-term securities 17,800,000 7,800,000 -- 11,000,000
============================================================================================================
* For the period March 26, 2002 (commencement of operations) through June 30,
2002.
** For the period March 25, 2002 (commencement of operations) through June 30,
2002.
60
5. INCOME TAX INFORMATION
The following information is presented on an income tax basis as of June 30,
2002. Differences between amounts for financial statement and federal income tax
purposes are primarily due to timing differences in recognizing income on
taxable market discount securities and timing differences in recognizing certain
gains and losses on security transactions.
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)
-------------------------------------------------------------------------------------------------------------
Cost of Investments $444,942,627 $260,545,511 $138,649,664 $103,284,636
=============================================================================================================
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)
-------------------------------------------------------------------------------------------------------------
Cost of Investments $358,685,979 $330,811,342 $75,254,341 $80,783,160
=============================================================================================================
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)
-------------------------------------------------------------------------------------------------------------
Gross unrealized:
appreciation $17,075,877 $16,278,838 $2,051,610 $1,316,855
depreciation (490,974) (140,621) (763,880) (86,081)
-------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments $16,584,903 $16,138,217 $1,287,730 $1,230,774
=============================================================================================================
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)
-------------------------------------------------------------------------------------------------------------
Gross unrealized:
appreciation $12,083,988 $18,474,630 $2,224,038 $1,639,929
depreciation (1,104,737) (1,778,319) (59,056) --
-------------------------------------------------------------------------------------------------------------
Net unrealized appreciation on investments $10,979,251 $16,696,311 $2,164,982 $1,639,929
=============================================================================================================
The tax components of undistributed net investment income and realized gains at
June 30, 2002, were as follows:
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)
-------------------------------------------------------------------------------------------------------------
Undistributed tax-exempt income $3,132,838 $2,109,297 $653,719 $305,681
Undistributed ordinary income * -- 132,968 -- --
Undistributed long-term capital gains 1,396,202 -- -- --
=============================================================================================================
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)
-------------------------------------------------------------------------------------------------------------
Undistributed tax-exempt income $1,874,255 $3,139,695 $465,412 $238,706
Undistributed ordinary income * -- 61,572 107,024 85,308
Undistributed long-term capital gains -- -- 74,964 --
=============================================================================================================
* Ordinary income consists of taxable market discount income and short-term
capital gains, if any.
61
Notes to Financial Statements (continued)
The tax character of distributions paid during the period ended June 30, 2002,
were as follows:
NEW JERSEY NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME ADVANTAGE ADVANTAGE 2
(NQJ) (NNJ) (NXJ) (NUJ)
--------------------------------------------------------------------------------------------------------------
Distributions from tax-exempt income $21,088,032 $11,570,615 $6,441,891 $393,252
Distributions from ordinary income * -- -- -- --
Distributions from long-term capital gains -- -- -- --
==============================================================================================================
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND DIVIDEND
QUALITY INCOME 2 ADVANTAGE ADVANTAGE 2
(NQP) (NPY) (NXM) (NVY)
--------------------------------------------------------------------------------------------------------------
Distributions from tax-exempt income $16,999,987 $15,403,533 $3,318,131 $329,421
Distributions from ordinary income * -- -- 50,898 --
Distributions from long-term capital gains -- -- -- --
==============================================================================================================
* Ordinary income consists of taxable market discount income and short-term
capital gains, if any.
At June 30, 2002, the following Funds had unused capital loss carryforwards
available for federal income tax purposes to be applied against future capital
gains, if any. If not applied, the carryforwards will expire as follows:
NEW JERSEY NEW JERSEY PENNSYLVANIA PENNSYLVANIA
PREMIUM DIVIDEND INVESTMENT PREMIUM
INCOME ADVANTAGE QUALITY INCOME 2
(NNJ) (NXJ) (NQP) (NPY)
--------------------------------------------------------------------------------------------------------------
Expiration year:
2003 $ 129,409 $ -- $ -- $ --
2004 650,143 -- -- --
2005 174,583 -- -- --
2006 -- -- -- --
2007 244,178 -- -- --
2008 27,220 -- 394,765 695,230
2009 521,212 6,266 362,560 --
2010 -- 285,894 2,247,115 --
--------------------------------------------------------------------------------------------------------------
Total $1,746,745 $292,160 $3,004,440 $695,230
==============================================================================================================
62
6. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under New Jersey Investment Quality's (NQJ), New Jersey Premium Income's (NNJ),
Pennsylvania Investment Quality's (NQP) and Pennsylvania Premium Income 2's
(NPY) investment management agreements with the Adviser, each Fund pays an
annual management fee, payable monthly, at the rates set forth below, which are
based upon the average daily net assets (including net assets attributable to
Preferred shares) of each Fund as follows:
AVERAGE DAILY NET ASSETS (INCLUDING NET ASSETS ATTRIBUTABLE TO PREFERRED SHARES) MANAGEMENT FEE
--------------------------------------------------------------------------------------------------------------
For the first $125 million .6500 of 1%
For the next $125 million .6375 of 1
For the next $250 million .6250 of 1
For the next $500 million .6125 of 1
For the next $1 billion .6000 of 1
For the next $3 billion .5875 of 1
For net assets over $5 billion .5750 of 1
==============================================================================================================
Under New Jersey Dividend Advantage's (NXJ), New Jersey Dividend Advantage 2's
(NUJ), Pennsylvania Dividend Advantage's (NXM) and Pennsylvania Dividend
Advantage 2's (NVY) investment management agreements with the Adviser, each Fund
pays an annual management fee, payable monthly, at the rates set forth below,
which are based upon the average daily net assets (including net assets
attributable to Preferred shares) of each Fund as follows:
AVERAGE DAILY NET ASSETS (INCLUDING NET ASSETS ATTRIBUTABLE TO PREFERRED SHARES) MANAGEMENT FEE
--------------------------------------------------------------------------------------------------------------
For the first $125 million .6500 of 1%
For the next $125 million .6375 of 1
For the next $250 million .6250 of 1
For the next $500 million .6125 of 1
For the next $1 billion .6000 of 1
For net assets over $2 billion .5750 of 1
==============================================================================================================
For the first ten years of New Jersey Dividend Advantage's (NXJ) and
Pennsylvania Dividend Advantage's (NXM) operations, the Adviser has agreed to
reimburse the Funds, as a percentage of average daily net assets (including net
assets attributable to Preferred shares), for fees and expenses in the amounts,
and for the time periods set forth below:
YEAR ENDING YEAR ENDING
MARCH 31, MARCH 31,
--------------------------------------------------------------------------------------------------------------
2001* .30% 2007 .25%
2002 .30 2008 .20
2003 .30 2009 .15
2004 .30 2010 .10
2005 .30 2011 .05
2006 .30
==============================================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse New Jersey Dividend Advantage (NXJ) and
Pennsylvania Dividend Advantage (NXM) for any portion of its fees and expenses
beyond March 31, 2011.
For the first ten years of New Jersey Dividend Advantage 2's (NUJ) and
Pennsylvania Dividend Advantage 2's (NVY) operations, the Adviser has agreed to
reimburse the Funds, as a percentage of average daily net assets (including net
assets attributable to Preferred shares), for fees and expenses in the amounts,
and for the time periods set forth below:
YEAR ENDING YEAR ENDING
MARCH 31, MARCH 31,
-----------------------------------------------------------------------------------------------------------
2002* .30% 2008 .25%
2003 .30 2009 .20
2004 .30 2010 .15
2005 .30 2011 .10
2006 .30 2012 .05
2007 .30
==============================================================================================================
* From the commencement of operations.
The Adviser has not agreed to reimburse New Jersey Dividend Advantage 2 (NUJ)
and Pennsylvania Dividend Advantage 2 (NVY) for any portion of its fees and
expenses beyond March 31, 2012.
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to those of its Directors/Trustees who are affiliated with
the Adviser or to their officers, all of whom receive remuneration for their
services to the Funds from the Adviser.
63
Financial Highlights
Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions
---------------------------------------------------- --------------------------
Distributions From and
from and in Distributions in Excess
Excess of Net from of Net Offering
Beginning Net Investment Capital Investment Capital Costs and Ending
Common Realized/ Income to Gains to Income to Gains to Preferred Common
Share Net Unrealized Preferred Preferred Common Common Share Share
Net Asset Investment Investment Share- Share- Share- Share- Underwriting Net Asset
Value Income Gain (Loss) holders+ holders+ Total holders holders Total Discounts Value
---------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY INVESTMENT QUALITY (NQJ)
---------------------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) $15.03 $1.10 $(.01) $(.13) $-- $ .96 $(.92) $-- $(.92) $-- $15.07
2001 14.45 1.19 .58 (.27) -- 1.50 (.92) -- (.92) -- 15.03
2000 15.14 1.20 (.63) (.29) (.01) .27 (.92) (.04) (.96) -- 14.45
1999 15.65 1.14 (.46) (.20) (.01) .47 (.93) (.03) (.96) (.02) 15.14
1998 15.41 1.16 .29 (.22) (.01) 1.22 (.95) (.03) (.98) -- 15.65
NEW JERSEY PREMIUM INCOME (NNJ)
---------------------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) 15.27 1.06 .24 (.12) -- 1.18 (.85) -- (.85) -- 15.60
2001 14.28 1.07 .99 (.25) -- 1.81 (.82) -- (.82) -- 15.27
2000 14.92 1.08 (.62) (.25) -- .21 (.85) -- (.85) -- 14.28
1999 15.34 1.08 (.41) (.22) -- .45 (.87) -- (.87) -- 14.92
1998 14.71 1.10 .65 (.26) -- 1.49 (.86) -- (.86) -- 15.34
NEW JERSEY DIVIDEND ADVANTAGE (NXJ)
---------------------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) 14.39 1.04 (.07) (.13) -- .84 (.85) -- (.85) -- 14.38
2001(a) 14.33 .14 .22 (.03) -- .33 (.14) -- (.14) (.13) 14.39
NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ)
---------------------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(b) 14.33 .16 .27 (.01) -- .42 (.15) -- (.15) (.14) 14.46
=================================================================================================================================
Ratios/Supplemental Data
-----------------------------------------------------------------------
Before After Credit/
Total Returns Credit/Reimbursement Reimbursement***
----------------- ----------------------- ----------------------
Ratio of Net Ratio of Net
Based Ratio of Investment Ratio of Investment
on Ending Expenses Income to Expenses Income to
Common Net to Average Average to Average Average
Based Share Assets Net Assets Net Assets Net Assets Net Assets
Ending on Net Applicable Applicable Applicable Applicable Applicable Portfolio
Market Market Asset to Common to Common to Common to Common to Common Turnover
Value Value** Value** Shares (000) Shares++ Shares++ Shares++ Shares++ Rate
-------------------------------------------------------------------------------------------------------------------
NEW JERSEY INVESTMENT QUALITY (NQJ)
-------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) $15.2200 4.19% 6.56% $304,808 1.25% 7.35% 1.23% 7.36% 22%
2001 15.5000 17.13 10.62 301,785 1.24 7.97 1.23 7.99 16
2000 14.0625 (4.94) 1.94 288,810 1.22 8.27 1.21 8.28 11
1999 15.8125 (2.33) 2.82 301,329 1.13 7.27 1.13 7.27 8
1998 17.1250 11.38 8.12 308,878 1.13 7.40 1.13 7.40 6
NEW JERSEY PREMIUM INCOME (NNJ)
-------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) 15.5000 7.88 7.91 187,393 1.22 6.85 1.22 6.86 14
2001 15.1900 20.13 12.90 183,451 1.25 7.14 1.24 7.15 6
2000 13.3750 (9.95) 1.64 171,496 1.24 7.61 1.23 7.63 10
1999 15.8125 7.17 2.87 178,704 1.24 7.00 1.24 7.00 10
1998 15.5625 11.12 10.35 182,676 1.25 7.24 1.25 7.24 13
NEW JERSEY DIVIDEND ADVANTAGE (NXJ)
-------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) 14.1200 (.17) 6.05 94,130 1.24 6.76 .75 7.25 7
2001(a) 14.9900 .87 1.42 94,187 1.05* 3.65* .66* 4.03* 1
NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ)
-------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(b) 15.0400 1.29 1.98 65,153 1.07* 3.86* .67* 4.25* --
===================================================================================================================
Municipal Auction Rate Cumulative
Preferred Stock at End of Period
--------------------------------
Aggregate Liquidation
Amount and Market Asset
Outstanding Value Coverage
(000) Per Share Per Share
--------------------------------------------------
NEW JERSEY INVESTMENT QUALITY (NQJ)
--------------------------------------------------
Year Ended 6/30:
2002(c) $162,000 $25,000 $72,038
2001 162,000 25,000 71,572
2000 162,000 25,000 69,569
1999 162,000 25,000 71,501
1998 130,000 25,000 84,400
NEW JERSEY PREMIUM INCOME (NNJ)
--------------------------------------------------
Year Ended 6/30:
2002(c) 91,600 25,000 76,144
2001 91,600 25,000 75,068
2000 91,600 25,000 71,806
1999 91,600 25,000 73,773
1998 91,600 25,000 74,857
NEW JERSEY DIVIDEND ADVANTAGE (NXJ)
--------------------------------------------------
Year Ended 6/30:
2002(c) 48,000 25,000 74,026
2001(a) 48,000 25,000 74,055
NEW JERSEY DIVIDEND ADVANTAGE 2 (NUJ)
--------------------------------------------------
Year Ended 6/30:
2002(b) 34,500 25,000 72,213
==================================================
* Annualized.
** Total Investment Return on Market Value is the combination of reinvested
dividend income, reinvested capital gains distributions, if any, and
changes in stock price per share. Total Return on Common Share Net Asset
Value is the combination of reinvested dividend income, reinvested capital
gains distributions, if any, and changes in Common share net asset value
per share. Total returns are not annualized.
*** After custodian fee credit and expense reimbursement, where applicable.
+ The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares.
(a) For the period March 28, 2001 (commencement of operations) through June 30,
2001.
(b) For the period March 26, 2002 (commencement of operations) through June 30,
2002.
(c) As required, effective July 1, 2001, the Funds have adopted the provisions
of the new AICPA Audit and Accounting Guide for Investment Companies and
began accreting taxable market discount on debt securities. The effect of
this change for the fiscal year ended June 30, 2002, was to increase net
investment income per share with a corresponding decrease in net
realized/unrealized investment gain (loss) per share and increase each
ratio of net investment income to average net assets applicable to Common
shares as follows:
NEW JERSEY NEW JERSEY NEW JERSEY
INVESTMENT PREMIUM DIVIDEND
QUALITY (NQJ) INCOME (NNJ) ADVANTAGE (NXJ)
-------------------------------------------------------------------------------
2002 per share impact ($) -- -- --
2002 income ratio impact (%) -- .02 --
The Financial Highlights for the prior periods have not been restated to
reflect this change in presentation.
See accompanying notes to financial statements.
64-65 SPREAD
Financial Highlights (continued)
Selected data for a Common share outstanding throughout each period:
Investment Operations Less Distributions
---------------------------------------------------- --------------------------
Distributions From and
from and in Distributions in Excess
Excess of Net from of Net Offering
Beginning Net Investment Capital Investment Capital Costs and Ending
Common Realized/ Income to Gains to Income to Gains to Preferred Common
Share Net Unrealized Preferred Preferred Common Common Share Share
Net Asset Investment Investment Share- Share- Share- Share- Underwriting Net Asset
Value Income Gain (Loss) holders+ holders+ Total holders holders Total Discounts Value
---------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA INVESTMENT QUALITY (NQP)
---------------------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) $14.57 $1.09 $ .09 $(.14) $-- $1.04 $ (.91) $-- $ (.91) $-- $14.70
2001 14.39 1.23 .16 (.30) -- 1.09 (.91) -- (.91) -- 14.57
2000 15.33 1.25 (.83) (.29) (.02) .11 (.98) (.07) (1.05) -- 14.39
1999 15.94 1.22 (.59) (.21) -- .42 (1.01) -- (1.01) (.02) 15.33
1998 15.91 1.23 .10 (.23) (.01) 1.09 (1.01) (.05) (1.06) -- 15.94
PENNSYLVANIA PREMIUM INCOME 2 (NPY)
---------------------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) 14.44 1.07 .30 (.12) -- 1.25 (.86) -- (.86) -- 14.83
2001 13.48 1.07 .95 (.27) -- 1.75 (.79) -- (.79) -- 14.44
2000 14.30 1.06 (.78) (.27) -- .01 (.81) (.02) (.83) -- 13.48
1999 14.86 1.04 (.61) (.23) -- .20 (.76) -- (.76) -- 14.30
1998 14.20 1.02 .67 (.26) -- 1.43 (.77) -- (.77) -- 14.86
PENNSYLVANIA DIVIDEND ADVANTAGE (NXM)
---------------------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) 14.48 1.12 .37 (.13) -- 1.36 (.87) (.01) (.88) -- 14.96
2001(a) 14.33 .14 .35 (.03) -- .46 (.15) -- (.15) (.16) 14.48
PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY)
---------------------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(b) 14.33 .15 .46 (.01) -- .60 (.15) -- (.15) (.14) 14.64
=================================================================================================================================
Ratios/Supplemental Data
-----------------------------------------------------------------------
Before After Credit/
Total Returns Credit/Reimbursement Reimbursement***
----------------- ----------------------- ----------------------
Ratio of Net Ratio of Net
Based Ratio of Investment Ratio of Investment
on Ending Expenses Income to Expenses Income to
Common Net to Average Average to Average Average
Based Share Assets Net Assets Net Assets Net Assets Net Assets
Ending on Net Applicable Applicable Applicable Applicable Applicable Portfolio
Market Market Asset to Common to Common to Common to Common to Common Turnover
Value Value** Value** Shares (000) Shares++ Shares++ Shares++ Shares++ Rate
---------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA INVESTMENT QUALITY (NQP)
---------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) $15.1800 6.57% 7.34% $238,926 1.31% 7.42% 1.30% 7.44% 34%
2001 15.1300 11.99 7.75 235,188 1.29 8.40 1.27 8.41 17
2000 14.3750 (7.39) .94 231,525 1.26 8.57 1.25 8.59 8
1999 16.6875 2.56 2.50 245,468 1.16 7.61 1.16 7.61 16
1998 17.2500 8.77 7.02 253,139 1.15 7.65 1.15 7.65 9
PENNSYLVANIA PREMIUM INCOME 2 (NPY)
---------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) 14.7900 13.25 8.88 233,536 1.24 7.28 1.23 7.29 7
2001 13.8700 19.04 13.25 227,377 1.25 7.55 1.24 7.57 10
2000 12.3750 (3.87) .21 212,325 1.26 7.88 1.25 7.89 14
1999 13.7500 7.98 1.27 225,235 1.24 6.93 1.24 6.93 9
1998 13.4375 6.27 10.29 234,023 1.24 6.99 1.24 6.99 32
PENNSYLVANIA DIVIDEND ADVANTAGE (NXM)
---------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(c) 14.8900 9.10 9.67 49,306 1.29 7.12 .82 7.59 48
2001(a) 14.4900 (2.45) 2.06 47,723 1.26* 3.51* .87* 3.90* --
PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY)
---------------------------------------------------------------------------------------------------------------------
Year Ended 6/30:
2002(b) 14.7400 (.73) 3.24 54,481 1.09* 3.77* .70* 4.15* 8
=====================================================================================================================
Municipal Auction Rate Cumulative
Preferred Stock at End of Period
--------------------------------
Aggregate Liquidation
Amount and Market Asset
Outstanding Value Coverage
(000) Per Share Per Share
--------------------------------------------------
PENNSYLVANIA INVESTMENT QUALITY (NQP)
--------------------------------------------------
Year Ended 6/30:
2002(c) $132,000 $25,000 $70,251
2001 132,000 25,000 69,543
2000 132,000 25,000 68,849
1999 132,000 25,000 71,490
1998 110,000 25,000 82,532
PENNSYLVANIA PREMIUM INCOME 2 (NPY)
--------------------------------------------------
Year Ended 6/30:
2002(c) 118,100 25,000 74,436
2001 118,100 25,000 73,132
2000 118,100 25,000 69,946
1999 118,100 25,000 72,679
1998 118,100 25,000 74,539
PENNSYLVANIA DIVIDEND ADVANTAGE (NXM)
--------------------------------------------------
Year Ended 6/30:
2002(c) 25,000 25,000 74,306
2001(a) 25,000 25,000 72,723
PENNSYLVANIA DIVIDEND ADVANTAGE 2 (NVY)
--------------------------------------------------
Year Ended 6/30:
2002(b) 28,500 25,000 72,790
==================================================
* Annualized.
** Total Investment Return on Market Value is the combination of reinvested
dividend income, reinvested capital gains distributions, if any, and
changes in stock price per share. Total Return on Common Share Net Asset
Value is the combination of reinvested dividend income, reinvested capital
gains distributions, if any, and changes in Common share net asset value
per share. Total returns are not annualized.
*** After custodian fee credit and expense reimbursement, where applicable. +
The amounts shown are based on Common share equivalents.
++ Ratios do not reflect the effect of dividend payments to Preferred
shareholders; income ratios reflect income earned on assets attributable to
Preferred shares.
(a) For the period March 29, 2001 (commencement of operations) through June 30,
2001.
(b) For the period March 25, 2002 (commencement of operations) through June 30,
2002.
(c) As required, effective July 1, 2001, the Funds have adopted the provisions
of the new AICPA Audit and Accounting Guide for Investment Companies and
began accreting taxable market discount on debt securities. The effect of
this change for the fiscal year ended June 30, 2002, was to increase net
investment income per share with a corresponding decrease in net
realized/unrealized investment gain (loss) per share and increase each
ratio of net investment income to average net assets applicable to Common
shares as follows:
PENNSYLVANIA PENNSYLVANIA PENNSYLVANIA
INVESTMENT PREMIUM DIVIDEND
QUALITY (NQP) INCOME 2 (NPY) ADVANTAGE (NXM)
-------------------------------------------------------------------------------
2002 per share impact ($) -- .01 .01
2002 income ratio impact (%) .02 .06 .09
The Financial Highlights for the prior periods have not been restated to
reflect this change in presentation.
See accompanying notes to financial statements.
66-67 SPREAD
Directors/Trustees and Officers
The management of the Funds, including general supervision of the duties
performed for the Funds under the Management Agreement, is the responsibility of
the Board of Directors/Trustees of the Funds. The number of directors/trustees
of the Funds is currently set at seven, one of whom is an "interested person"
(as the term is defined in the Investment Company Act of 1940) and six of whom
are not interested persons. None of the directors/trustees who are not
interested persons of the Funds have ever been a director or employee of, or
consultant to, Nuveen or its affiliates. The names and business addresses of the
directors/trustees and officers of the Funds, their principal occupations and
other affiliations during the past five years, the number of portfolios each
oversees and other directorships they hold are set forth below.
NUMBER OF PORTFOLIOS
YEAR FIRST PRINCIPAL OCCUPATION(S) IN FUND COMPLEX
NAME, BIRTHDATE POSITION(S) HELD ELECTED OR APPOINTED INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS WITH THE FUND AND TERM OF OFFICE DURING PAST 5 YEARS DIRECTOR/TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
DIRECTOR/TRUSTEE WHO IS AN INTERESTED PERSON OF THE FUNDS:
------------------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger (1) Chairman of the 1994 Chairman and Director (since July 1996) 130
3/28/1949 Board, President Term of The John Nuveen Company, Nuveen
333 West Wacker Drive and Director/Trustee Indefinite (2) Investments, Nuveen Advisory Corp. and
Chicago, IL 60606 Nuveen Institutional Advisory Corp.;
prior thereto, Executive Vice President
and Director of The John Nuveen Company
and Nuveen Investments; Director (since
1992) and Chairman (since 1996) of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp.; Chairman and Director (since
January 1997) of Nuveen Asset Management, Inc.;
Director (since 1996) of Institutional Capital
Corporation; Chairman and Director (since 1999)
of Rittenhouse Financial Services Inc.; Chief
Executive Officer (since September 1999) of
Nuveen Senior Loan Asset Management Inc.
DIRECTORS/TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE FUNDS:
------------------------------------------------------------------------------------------------------------------------------------
ROBERT P. BREMNER Director/Trustee 1997 Private Investor and Management Consultant. 112
8/22/1940 Term
333 W. Wacker Drive Indefinite (2)
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
LAWRENCE H. BROWN Director/Trustee 1993 Retired (August 1989) as Senior Vice President 112
7/29/1934 Term of The Northern Trust Company.
333 W. Wacker Drive Indefinite (2)
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
ANNE E. IMPELLIZZERI Director/Trustee 1994 Retired (2002); formerly, Executive Director 112
1/26/1933 Term (since 1998) of Manitoga (Center for Russel
333 W. Wacker Drive Indefinite (2) Wright's Design with Nature); prior thereto,
Chicago, IL 60606 President and Chief Executive Officer of
Blanton-Peale Institutes of Religion and Health
(since December 1990); prior thereto, Vice President,
Metropolitan Life Insurance Co.
------------------------------------------------------------------------------------------------------------------------------------
PETER R. SAWERS Director/Trustee 1991 Adjunct Professor of Business and Economics, 112
4/3/1933 Term University of Dubuque, Iowa; Director, Executive
333 W. Wacker Drive Indefinite (2) Service Corps of Chicago (not-for-profit); Director,
Chicago, IL 60606 Hadley School for the Blind (not-for-profit);
formerly (1991-2000) Adjunct Professor, Lake Forest
Graduate School of Management, Lake Forest, Illinois;
prior thereto, Executive Director, Towers Perrin
Australia, a management consulting firm; Chartered
Financial Analyst; Certified Management Consultant.
68
NUMBER OF PORTFOLIOS
YEAR FIRST PRINCIPAL OCCUPATION(S) IN FUND COMPLEX
NAME, BIRTHDATE POSITION(S) HELD ELECTED OR APPOINTED INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS WITH THE FUND AND TERM OF OFFICE DURING PAST 5 YEARS DIRECTOR/TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
DIRECTORS/TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
WILLIAM J. SCHNEIDER Director/Trustee 1997 Senior Partner and Chief Operating Officer, 112
9/24/1944 Term Miller-Valentine Group, Vice President,
333 W. Wacker Drive Indefinite (2) Miller-Valentine Realty, a development and
Chicago, IL 60606 contract company; Chair, Miami Valley Hospital;
Vice Chair, Miami Valley Economic Development
Coalition; formerly, Member, Community Advisory
Board, National City Bank, Dayton, Ohio; and
Business Advisory Council, Cleveland Federal
Reserve Bank.
------------------------------------------------------------------------------------------------------------------------------------
JUDITH M. STOCKDALE Director/Trustee 1997 Executive Director, Gaylord and Dorothy 112
12/29/1947 Term Donnelley Foundation (since 1994); prior
333 W. Wacker Drive Indefinite (2) thereto, Executive Director, Great Lakes
Chicago, IL 60606 Protection Fund (from 1990 to 1994).
NUMBER OF PORTFOLIOS
YEAR FIRST PRINCIPAL OCCUPATION(S) IN FUND COMPLEX
NAME, BIRTHDATE POSITION(S) HELD ELECTED OR APPOINTED INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS WITH THE FUND AND TERM OF OFFICE DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
------------------------------------------------------------------------------------------------------------------------------------
MICHAEL T. ATKINSON Vice President 2002 Vice President (since January 2002), formerly, 130
2/3/1966 Assistant Vice President (since 2000), previously,
333 W. Wacker Drive Associate of Nuveen Investments.
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
PAUL L. BRENNAN Vice President 2002 Vice President (since January 2002), formerly, 126
11/10/1966 Assistant Vice President, of Nuveen
333 W. Wacker Drive Advisory Corp.
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
PETER H. D'ARRIGO Vice President 1999 Vice President of Nuveen Investments (since 130
11/28/1967 and Treasurer January 1999), prior thereto, Assistant Vice
333 W. Wacker Drive President (from January 1997); formerly,
Chicago, IL 60606 Associate of Nuveen Investments; Vice President
and Treasurer (since September 1999) of Nuveen
Senior Loan Asset Management Inc.; Chartered
Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
MICHAEL S. DAVERN Vice President 1997 Vice President of Nuveen Advisory Corp. 126
6/26/1957
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
SUSAN M. DESANTO Vice President 2001 Vice President of Nuveen Advisory Corp. (since 130
9/8/1954 August 2001); previously, Vice President of
333 W. Wacker Drive Van Kampen Investment Advisory Corp.
Chicago, IL 60606 (since 1998); prior thereto, Assistant Vice
President of Van Kampen Investment
Advisory Corp.
69
Directors/Trustees and Officers (continued)
NUMBER OF PORTFOLIOS
YEAR FIRST PRINCIPAL OCCUPATION(S) IN FUND COMPLEX
NAME, BIRTHDATE POSITION(S) HELD ELECTED OR APPOINTED INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS WITH THE FUND AND TERM OF OFFICE DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
JESSICA R. DROEGER Vice President 2002 Vice President (since January 2002) and Assistant 130
9/24/1964 General Counsel (since May 1998), formerly
333 W. Wacker Drive Assistant Vice President of Nuveen Investments;
Chicago, IL 60606 Assistant Vice President and Assistant Secretary
(since 1998) of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.; prior thereto,
Associate at the law firm D'Ancona Partners LLC
------------------------------------------------------------------------------------------------------------------------------------
LORNA C. FERGUSON Vice President 1998 Vice President of Nuveen Investments; Vice 130
10/24/1945 President (since January 1998) of Nuveen
333 W. Wacker Drive Advisory Corp. and Nuveen Institutional
Chicago, IL 60606 Advisory Corp.
------------------------------------------------------------------------------------------------------------------------------------
WILLIAM M. FITZGERALD Vice President 1995 Managing Director of Nuveen Advisory Corp. and 130
3/2/1964 Nuveen Institutional Advisory Corp. (since February
333 W. Wacker Drive 2001); prior thereto, Vice President of Nuveen
Chicago, IL 60606 Advisory Corp.; Chartered Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
STEPHEN D. FOY Vice President 1998 Vice President of Nuveen Investments and 130
5/31/1954 and Controller (since May 1998) The John Nuveen Company; Vice
333 W. Wacker Drive President (since September 1999) of Nuveen
Chicago, IL 60606 Senior Loan Asset Management Inc.; Certified Public
Accountant.
------------------------------------------------------------------------------------------------------------------------------------
J. THOMAS FUTRELL Vice President 1992 Vice President of Nuveen Advisory Corp.; 126
7/5/1955 Chartered Financial Analyst.
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
RICHARD A. HUBER Vice President 1997 Vice President of Nuveen Institutional Advisory 126
3/26/1963 Corp. (since March 1998) and Nuveen
333 W. Wacker Drive Advisory Corp.
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
STEVEN J. KRUPA Vice President 1990 Vice President of Nuveen Advisory Corp. 126
8/21/1957
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
DAVID J. LAMB Vice President 2000 Vice President (since March 2000) of Nuveen 130
3/22/1963 Investments, previously Assistant Vice
333 W. Wacker Drive President (since January 1999); prior thereto,
Chicago, IL 60606 Associate of Nuveen Investments; Certified
Public Accountant.
------------------------------------------------------------------------------------------------------------------------------------
TINA M. LAZAR Vice President 2002 Vice President (since 1999), previously, 130
8/27/1961 Assistant Vice President (since 1993) of
333 W. Wacker Drive Nuveen Investments.
Chicago, IL 60606
70
NUMBER OF PORTFOLIOS
YEAR FIRST PRINCIPAL OCCUPATION(S) IN FUND COMPLEX
NAME, BIRTHDATE POSITION(S) HELD ELECTED OR APPOINTED INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS WITH THE FUND AND TERM OF OFFICE DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
LARRY W. MARTIN Vice President 1992 Vice President, Assistant Secretary and 130
7/27/1951 and Assistant Assistant General Counsel of Nuveen
333 W. Wacker Drive Secretary Investments; Vice President and Assistant
Chicago, IL 60606 Secretary of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.; Vice President and
Assistant Secretary of The John Nuveen
Company and Nuveen Asset Management, Inc.;
Vice President and Assistant Secretary (since
September 1999) of Nuveen Senior Loan Asset
Management Inc.
------------------------------------------------------------------------------------------------------------------------------------
EDWARD F. NEILD, IV Vice President 1996 Managing Director (since September 1997), previously 130
7/7/1965 Vice President of Nuveen Advisory Corp. and
333 W. Wacker Drive Nuveen Institutional Advisory Corp.; Chartered
Chicago, IL 60606 Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
THOMAS J. O'SHAUGHNESSY Vice President 2002 Vice President (since January 2002), formerly, 126
9/4/1960 Assistant Vice President (1998), of Nuveen
333 W. Wacker Drive Advisory Corp.; prior thereto, Portfolio Manager.
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
THOMAS C. SPALDING, JR. Vice President 1982 Vice President of Nuveen Advisory Corp. and 126
7/31/1951 Nuveen Institutional Advisory Corp.; Chartered
333 W. Wacker Drive Financial Analyst.
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
GIFFORD R. ZIMMERMAN Vice President 1992 Managing Director (since January 2002), 130
9/9/1956 and Secretary Assistant Secretary and Associate General
333 W. Wacker Drive Counsel, formerly Assistant General Counsel
Chicago, IL 60606 and Vice President of Nuveen Investments;
Managing Director (since January 2002), General
Counsel and Assistant Secretary, formerly Vice
President of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.; Vice President and
Assistant Secretary of The John Nuveen Company;
Managing Director (since January 2002), and
Assistant Secretary (since September 1999),
formerly Vice President of Nuveen Senior
Loan Asset Management Inc.; Managing Director
(since January 2002), Assistant Secretary and
Associate General Counsel, formerly Vice President
(since 2000), of Nuveen Asset Management Inc.;
Chartered Financial Analyst.
(1)Mr. Schwertfeger is an "interested person" of the Funds, as defined in the
Investment Company Act of 1940, because he is an officer and director of
Nuveen Advisory Corp.
(2)Directors/Trustees serve an indefinite term until his/her successor is elected.
(3)Officers serve one year terms through July of each year.
71
Build Your Wealth Automatically
Nuveen makes reinvesting easy. A phone call is all it takes to set up your
reinvestment account.
Nuveen Closed-End Exchange-Traded Funds Dividend Reinvestment Plan
Your Nuveen Closed-End Exchange-Traded Fund allows you to conveniently reinvest
dividends and/or capital gains distributions in additional fund shares.
By choosing to reinvest, you'll be able to invest money regularly and
automatically, and watch your investment grow through the power of tax-free
compounding. Just like dividends or distributions in cash, there may be times
when income or capital gains taxes may be payable on dividends or distributions
that are reinvested.
It is important to note that an automatic reinvestment plan does not ensure a
profit, nor does it protect you against loss in a declining market.
Easy and convenient
To make recordkeeping easy and convenient, each month you'll receive a statement
showing your total dividends and distributions, the date of investment, the
shares acquired and the price per share, and the total number of shares you own.
How shares are purchased
The shares you acquire by reinvesting will either be purchased on the open
market or newly issued by the Fund. If the shares are trading at or above net
asset value at the time of valuation, the Fund will issue new shares at the
then-current market price. If the shares are trading at less than net asset
value, shares for your account will be purchased on the open market. Dividends
and distributions received to purchase shares in the open market will normally
be invested shortly after the dividend payment date. No interest will be paid on
dividends and distributions awaiting reinvestment. Because the market price of
shares may increase before purchases are completed, the average purchase price
per share may exceed the market price at the time of valuation, resulting in the
acquisition of fewer shares than if the dividend or distribution had been paid
in shares issued by the Fund. A pro rata portion of any applicable brokerage
commissions on open market purchases will be paid by Plan participants. These
commissions usually will be lower than those charged on individual transactions.
Flexibility
You may change your distribution option or withdraw from the Plan at any time,
should your needs or situation change. Should you withdraw, you can receive a
certificate for all whole shares credited to your reinvestment account and cash
payment for fractional shares, or cash payment for all reinvestment account
shares, less brokerage commissions and a $2.50 service fee.
You can reinvest whether your shares are registered in your name, or in the name
of a brokerage firm, bank, or other nominee. Ask your investment advisor if his
or her firm will participate on your behalf. Participants whose shares are
registered in the name of one firm may not be able to transfer the shares to
another firm and continue to participate in the Plan.
The Fund reserves the right to amend or terminate the Plan at any time. Although
the Fund reserves the right to amend the Plan to include a service charge
payable by the participants, there is no direct service charge to participants
in the Plan at this time.
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in
or withdraw from the Plan, speak with your financial advisor or call us at (800)
257-8787.
72
Fund Information
Board of Directors/Trustees
Robert P. Bremner
Lawrence H. Brown
Anne E. Impellizzeri
Peter R. Sawers
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Fund Manager
Nuveen Advisory Corp.
333 West Wacker Drive
Chicago, IL 60606
Custodian, Transfer Agent
and Shareholder Services
JPMorgan Chase Bank
P.O. Box 660086
Dallas, TX 75266-0086
(800) 257-8787
Legal Counsel
Morgan, Lewis &
Bockius LLP
Washington, D.C.
Independent Auditors
Ernst & Young LLP
Chicago, IL
On October 14, 2002, Boston Financial Data Services, Inc. will assume transfer
agent responsibilities for the Nuveen family of closed-end exchange-traded
funds. This change requires no action on your part and will not affect the way
your investments are managed.
The Nuveen Investor Services phone number will remain the same, (800) 257-8787,
but transactions and requests mailed for receipt after October 14th should be
mailed to the following addresses. TRANSACTIONS AND REQUESTS MAILED TO OUR OLD
ADDRESS MAY TAKE LONGER TO PROCESS.
REGULAR ADDRESS OVERNIGHT ADDRESS
Nuveen Investments Nuveen Investments
P.O. Box 43071 c/o EquiServe
Providence,RI 02940-3071 150 Royall Street
Canton, MA 02021
Watch your mail for complete information about this change in mid-September.
Each Fund intends to repurchase shares of its own common or preferred stock in
the future at such times and in such amounts as is deemed advisable. No shares
were repurchased during the period ended June 30, 2002. Any future repurchases
will be reported to shareholders in the next annual or semiannual report.
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Serving Investors for Generations
[photo of John Nuveen, Sr.]
John Nuveen, Sr.
For over a century, generations of Americans have relied on Nuveen Investments
to help them grow and keep the money they've earned. Financial advisors,
investors and their families have associated Nuveen Investments with quality,
expertise and dependability since 1898. That is why financial advisors have
entrusted the assets of more than 1.3 million investors to Nuveen.
With the know-how that comes from a century of experience, Nuveen continues to
build upon its reputation for quality. Now, financial advisors and investors can
count on Nuveen Investments to help them design customized solutions that meet
the far-reaching financial goals unique to family wealth strategies - solutions
that can translate into legacies.
To find out more about how Nuveen Investments' products and services can help
you preserve your financial security, talk with your financial advisor, or call
us at (800) 257-8787 for more information, including a prospectus where
applicable. Please read that information carefully before you invest.
[logo: NUVEEN Investments]
Nuveen Investments o 333 West Wacker Drive
Chicago, IL 60606 o www.nuveen.com FAN-B-0602