UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number 811-6623
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Nuveen California Select Tax-Free Income Portfolio
------------------------------------------------------------------------------
(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Address of principal executive offices) (Zip code)
Jessica R. Droeger
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
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Date of fiscal year end: March 31
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Date of reporting period: March 31, 2004
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
Nuveen Investments
Municipal Closed-End
Exchange-Traded
Funds
ANNUAL REPORT March 31, 2004
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO
NXP
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 2
NXQ
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 3
NXR
NUVEEN CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO
NXC
NUVEEN NEW YORK SELECT TAX-FREE INCOME PORTFOLIO
NXN
Photo of: Man holding up small boy.
Photo of: 2 women with 2 girls looking at seashells.
DEPENDABLE,
TAX-FREE INCOME
BECAUSE
IT'S NOT WHAT YOU EARN,
IT'S WHAT YOU KEEP.(R)
Logo: NUVEEN Investments
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Logo: NUVEEN Investments
Photo of: Timothy R. Schwertfeger
Chairman of the Board
Sidebar text: WE THINK THAT MUNICIPAL BOND INVESTMENTS LIKE YOUR NUVEEN FUND CAN
BE IMPORTANT BUILDING BLOCKS IN A WELL-BALANCED PORTFOLIO.
Dear
SHAREHOLDER
I am very pleased to report that for the period ended March 31, 2004, your
Nuveen Fund continued to provide you with attractive monthly tax-free income.
While tax-free income always is welcome, many of you may have begun to wonder
whether interest rates will rise, and whether that possibility should cause you
to adjust your holdings of tax-free municipal bond investments. We believe that
these are questions that should be thought through with a clear focus on your
long-term financial goals and not on day-to-day market movements. By maintaining
a carefully balanced portfolio with the help of a trusted investment
professional, you may be able to reduce your overall investment risk over the
long-term, and give yourself a better chance to meet your ultimate financial
goals.
As you read through this report, please don't skip the inside front cover. I
urge you to consider receiving future Fund reports and other Fund information by
e-mail and the Internet. Not only will you be able to receive the information
faster, but this also may help lower your Fund's expenses. Sign up is quick and
easy.
Since 1898, Nuveen Investments has offered financial products and solutions that
incorporate careful research, diversification and the application of
conservative risk-management principles. We are grateful that you have chosen us
as a partner as you pursue your financial goals. We look forward to continuing
to earn your trust in the months and years ahead.
Sincerely,
/s/ Timothy R. Schwertfeger
Timothy R. Schwertfeger
Chairman of the Board
May 15, 2004
1
Nuveen Select Portfolios
NXP, NXQ, NXR, NXC, NXN
Portfolio Managers'
COMMENTS
Portfolio managers Tom Spalding, Scott Romans, and Paul Brennan review the
market environment at the national and state levels, key investment strategies,
and the annual performance of the Nuveen Select Tax-Free Income Portfolios. With
29 years of investment experience, Tom has managed NXP, NXQ, and NXR since 1999.
Scott, who joined Nuveen in 2000, and Paul, who has 13 years of investment
experience, assumed portfolio management responsibility for NXC and NXN,
respectively, in January 2003.
WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE REPORTING
PERIOD ENDED MARCH 31, 2004?
During this reporting period, the greatest influences on the national economy
and the municipal market continued to be historically low interest rates, little
movement in the reported rate of inflation and growing evidence of economic
improvement. Since its last credit easing in June 2003, the Federal Reserve has
maintained the fed funds rate at 1.0%, the lowest level since 1958. This
accommodative monetary policy helped to spur GDP (gross domestic product) growth
of 4.2% (annualized) in the first quarter of 2004, following a 3.1% rise in
2003.
This generally favorable environment helped many municipal bonds perform well
during the 12 months ended March 31, 2004. Nationally, municipal supply reached
$382.7 billion in 2003, breaking the record set in 2002, although issuance
slowed somewhat during the second half of 2003. Tighter supply continued into
the first two months of 2004 before issuance picked up significantly in March.
HOW WERE ECONOMIC AND MARKET CONDITIONS IN CALIFORNIA AND NEW YORK?
In California, the political uncertainty surrounding the recall initiative
served to further complicate the state's financial difficulties. The California
economy remained hindered by the slow recovery of the technology sector, and the
state continued to lose jobs in government, manufacturing, and business
services. This was offset to some degree by California's strong housing market,
which fueled growth in construction, financial services, and consumer spending,
while increased defense spending had positive implications for the state's
aerospace industry. In addition, California's $100 billion export industry was
aided by the decline in the U.S. dollar over this period.
Moody's and Fitch downgraded California's general obligation debt to Baa1/BBB
from A3/A in December 2003. Standard & Poor's, which had downgraded the state in
July 2003, kept its rating at BBB, and all three agencies maintained negative
outlooks. However, in March 2004, California voters approved the issuance of $15
billion in economic recovery bonds as well as a resolution calling for future
limits on spending and borrowing. Moody's and S&P subsequently revised their
outlooks for California to stable and positive, respectively.
New York continued to recover from financial problems triggered by the national
economic downturn and deepened by the terrorist attacks of 2001. Although
increased Wall Street activity and a rebounding tourism industry had positive
implications for the state's economy and future tax revenues, New York continued
to slightly lag the national pace of recovery during this reporting period.
2
New York was the largest issuer in the nation during the first three months of
2004, with $11 billion in new paper. In February 2004, Standard & Poor's (S&P)
reconfirmed its rating of New York's general obligation debt at AA with a
negative outlook, while Moody's and Fitch maintained their ratings of A2 with a
stable outlook and AA-, respectively. As of March 31, 2004, New York City was
rated A2/A/A+, by Moody's, S&P and Fitch, respectively, with all three rating
agencies returning their outlooks for the city to stable from negative over the
past year.
California and New York continued to rank as the nation's largest issuers of
municipal debt in 2003, with $58 billion (an increase of 18% over 2002) and $42
billion (a decline of 14%) in new bonds, respectively. For the first three
months of 2004, however, California supply fell 37% from January-March 2003
levels, with total issuance of $10 billion. In New York, supply was more
plentiful during the first three months of 2004, with $11 billion in new paper,
an increase of 20% over January-March 2003.
IN THIS ENVIRONMENT, WHAT KEY STRATEGIES WERE USED TO MANAGE THE PORTFOLIOS
DURING THE 12 MONTHS ENDED MARCH 31, 2004?
Over this reporting period, we continued to work on transitioning the Select
Portfolios from their previous positioning with fixed termination dates, largely
static portfolios, intermediate durations1 and, in the case of NXC and NXN, 100%
insured portfolios. As part of this transition, one of our priorities during
this period was duration management, with the goal of enhancing the Portfolios'
performance potential and positioning them to produce potentially more
consistent returns over time. To implement this strategy, we took advantage of
attractive opportunities to sell bonds with shorter durations--pre-refunded
bonds, bonds with short call dates, and bonds that mature in the next year or
two--and reinvested the proceeds, as well as proceeds from called bonds, in
bonds with longer durations to extend the Portfolios' durations. In keeping with
the steepness of the municipal bond yield curve over this period, the majority
of our purchase activity focused on securities in the long-intermediate part of
the yield curve. In the national Portfolios, this meant bonds that mature in 20
to 25 years, while NXC and NXN focused on maturities of 15 to 20 years. In many
cases, bonds in this area of the curve offered yields similar to those of
longer-term bonds with less inherent interest rate risk.
Over the course of this annual period, we were able to extend the durations of
NXP, NXQ, and NXC, while the duration of NXN remained essen tially unchanged for
the period ended March 31, 2004. NXR's duration shortened slightly.
Although the heavy volume of municipal issuance during 2003 provided
opportunities to make trades that would benefit the Portfolios, we saw supply
soften in California and New York as well as at the national level during the
last half of 2003. As noted earlier, tighter supply also continued into the
first quarter of 2004 in the California market. This presented some challenges
in finding securities that we believed had the potential to add value and that
carried the types of structures and features we prefer.
1 Duration is a measure of a Portfolio's net asset value (NAV) volatility in
reaction to interest rate movements.
3
For NXP, NXQ, and NXR, our emphasis was on maintaining the Portfolios' credit
quality by purchasing high-quality bonds as credit spreads remained narrow,
improving call exposure by reinvesting proceeds in issues with at least eight
years of call protection, and watching both the primary and secondary markets
for bonds that can help these Portfolios achieve their long-term objectives.
For NXC, as we continued to work to diversify the credit quality of the
Portfolio over this period, we were active buyers of bonds rated BBB, including
toll roads, water and sewer, tobacco, and general obligation (GO) bonds. One of
our strategies over the longer term has centered on purchasing and selling
California GOs to take advantage of general market moves. In February 2004, we
bought part of the $2 billion issuance of state GOs at an attractive yield, with
the goal of modestly increasing NXC's exposure to this sector of the market. As
California continues to work its way out of its current credit problems, we
anticipate that the yield spreads on these bonds relative to national AAA
credits with similar maturities may narrow, providing us with opportunities to
sell some of these GO holdings at attractive prices in the future.
While our objectives and management strategies were similar in NXN, the New York
market did not provide as many lower-rated opportunities as California did over
the past 12 months. As of March 31, 2004, NXN continued to have the highest
percentage of bonds rated AAA/U.S guaranteed among these five Portfolios at 81%,
down from 86% in March 2003. Of this 81%, more than two-thirds were insured. As
with NXC, we used proceeds from the sale of pre-refunded bonds to purchase
lower-rated securities as appropriate opportunities became available in the New
York market during this period.
HOW DID THE PORTFOLIOS PERFORM?
Individual results for the Portfolios, as well as for relevant benchmarks, are
presented in the accompanying table.
TOTAL RETURNS ON NET ASSET VALUE
For periods ended 3/31/04
(annualized)
NATIONAL PORTFOLIOS 1-YEAR 5-YEAR 10-YEAR
---------------------------------------------------------
NXP 6.13% 5.24% 6.38%
---------------------------------------------------------
NXQ 6.31% 4.88% 6.11%
---------------------------------------------------------
NXR 6.13% 4.86% 6.25%
---------------------------------------------------------
Lehman Brothers
Municipal Bond
Index2 5.86% 6.00% 6.81%
---------------------------------------------------------
Lipper General and Insured
Unleveraged Municipal
Debt Funds average3 6.11% 4.73% 6.06%
---------------------------------------------------------
CALIFORNIA PORTFOLIO
---------------------------------------------------------
NXC 6.16% 4.80% 6.20%
---------------------------------------------------------
Lehman Brothers CA Tax-
Exempt Bond Index2 5.88% 5.74% 6.87%
---------------------------------------------------------
Lipper CA Municipal
Debt Funds average3 8.31% 6.12% 7.29%
---------------------------------------------------------
NEW YORK PORTFOLIO
---------------------------------------------------------
NXN 5.84% 4.97% 6.03%
---------------------------------------------------------
Lehman Brothers NY Tax-
Exempt Bond Index2 5.73% 6.00% 6.91%
---------------------------------------------------------
Lipper NY Municipal
Debt Funds average3 9.00% 6.25% 6.92%
---------------------------------------------------------
Data represents past performance which is no guarantee of future results.
Current performance may be higher or lower than the performance shown.
For additional information, see the individual Performance Overview for your
Portfolio in this report.
2 The Lehman Brothers Municipal Bond Index is an unleveraged, unmanaged
national index comprising a broad range of investment-grade municipal
bonds. The Lehman Brothers Tax-Exempt Bond Indexes for California and New
York are unleveraged, unmanaged indexes consisting of a broad range of
municipal bonds issued in California and New York, respectively. Results
for the Lehman indexes do not reflect any expenses.
3 The Lipper General and Insured Unleveraged Municipal Debt Funds category
average is calculated using the returns of all closed-end exchange-traded
funds in this category for each period as follows: 1 year, 9 funds; 5
years, 9; and 10 years, 9. The Lipper California Municipal Debt Funds
category average is based on the returns of all closed-end exchange-traded
funds in this category as follows: 1 year, 30 funds; 5 years, 18; and 10
years, 17. The Lipper New York Municipal Debt Funds category average is
based on the returns of all closed-end exchange-traded funds in this
category as follows: 1 year, 22 funds; 5 years, 11; and 10 years, 10.
Portfolio and Lipper returns assume reinvestment of dividends.
4
For the 12 months ended March 31, 2004, the total returns of all five of the
Select Portfolios outperformed their respective Lehman Brothers benchmarks. In
addition to the duration management strategies discussed in the previous
section, sector weightings and individual security selection were among the
primary factors that influenced the Portfolios' performances over the 12 month
period. For example, during this period, the healthcare sector, as measured by
the Lehman Municipal Bond Index, ranked second in terms of performance,
outperforming the market as a whole by approximately 120 basis points. Each of
the Portfolios had a substantial allocation of healthcare bonds, ranging from
10% in NXN to 15% in NXC, 16% in NXQ, 17% in NXP, and 18% in NXR as of March 31,
2004, which benefited their performances.
In addition, the past 12 month period saw increased market demand for high-yield
paper, which caused credit spreads to narrow. In this environment, the
Portfolios benefited from their holdings of lower-rated credits, as bonds rated
BBB outperformed the market as a whole over this period. As of March 31, 2004,
allocations of BBB bonds ranged from 4% in NXN, 7% in NXP, and 9% in NXR to 11%
in NXQ and 14% in NXC. Among the lower-rated holdings making a positive
contribution to the Portfolios' total annual returns were tobacco bonds, most of
which were rated BBB over the majority of this reporting period. These bonds
appreciated strongly during the last half of this period as the result of some
favorable legal developments. Over this period, we maintained our exposure to
tobacco-backed bonds at approximately 2% of NXP, 2% of NXN, and 5% of NXQ and
NXR.
In April 2004, following the end of this reporting period, Moody's announced a
ratings downgrade on all tobacco securities that were not enhanced or
additionally secured, based on an adverse ruling in a tobacco-related lawsuit in
New York. As of April 21, 2004, the majority of the Portfolios' tobacco bond
holdings were downgraded to Baa1, Baa2, or Baa3. It is important to note,
however, that the other major credit agencies--S&P and Fitch--did not change
their ratings based on the litigation cited by Moody's. We continue to closely
monitor all of these tobacco holdings.
HOW ABOUT THE PORTFOLIOS' DIVIDENDS AND SHARE PRICES?
With call exposure affecting up to 28% of their portfolios during 2003, the
Select Portfolios continued to face the need to reinvest proceeds from called
bonds over the 12 months ended March 31, 2004. This meant that older bonds
offering higher coupons had to be replaced with the bonds available in a market
where interest rates remained at historically low levels. While we were able to
maintain the dividend of NXR, the number of calls necessitated a single dividend
cut in each of the four remaining Portfolios over the 12 month period.
All of these Portfolios seek to pay stable dividends at rates that reflect each
Portfolio's past results and projected future performance. During certain
periods, each Portfolio may pay dividends at a rate
5
that may be more or less than the amount of net investment income actually
earned by the Portfolio during the period. If a Portfolio has cumulatively
earned more than it has paid in dividends, it holds the excess in reserve as
undistributed net investment income (UNII) as part of the Portfolio's net asset
value (NAV). Conversely, if a Portfolio has cumulatively paid dividends in
excess of its earnings, the excess constitutes negative UNII that is likewise
reflected in the Portfolio's NAV. Each Portfolio will, over time, pay all of its
net investment income as dividends to shareholders. As of March 31, 2004, NXN
had positive UNII, while NXQ, NXP, NXR, and NXC had negative UNII.
At the close of this reporting period on March 31, 2004, all five Portfolios
were trading at discounts to their common share NAVs (see charts on individual
Performance Overview pages).
HOW WERE THE PORTFOLIOS POSITIONED IN TERMS OF CREDIT QUALITY AND BOND CALLS AS
OF MARCH 31, 2004?
Given the current geopolitical and economic climate, we continued to believe
that maintaining strong credit quality was a vital requirement. As of the end of
March 2004, all five of the Select Portfolios continued to offer excellent
credit quality, with allocations of bonds rated AAA/U.S. guaranteed and AA
ranging from 69% in NXC, 71% in NXR, 76% in NXP, and 79% in NXQ to 96% in NXN.
At the same time, NXC also had an increase in its holdings rated BBB or lower,
due in part to the downgrade of California general obligation bonds by Moody's
and Fitch in December 2003. We also purchased additional BBB bonds for the
portfolio.
As of March 31, 2004, potential call exposure for these Portfolios during
2004-2005 ranged from 13% in NXN, 14% in NXP and NXC to 19% in NXQ and NXR. The
actual number of bond calls in all of the Portfolios depends largely on market
interest rates.
6
Nuveen Select Tax-Free Income Portfolio
Performance
OVERVIEW As of March 31, 2004
NXP
Pie Chart:
CREDIT QUALITY
AAA/U.S. Guaranteed 58%
AA 18%
A 16%
BBB 7%
BB or lower 1%
FUND SNAPSHOT
--------------------------------------------------
Share Price $14.30
--------------------------------------------------
Common Share Net Asset Value $14.85
--------------------------------------------------
Premium/(Discount) to NAV -3.70%
--------------------------------------------------
Market Yield 5.12%
--------------------------------------------------
Taxable-Equivalent Yield1 7.11%
--------------------------------------------------
Net Assets ($000) $243,165
--------------------------------------------------
Average Effective Maturity (Years) 14.66
--------------------------------------------------
Duration 5.68
--------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN (Inception 3/19/92)
--------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------
1-Year 7.34% 6.13%
--------------------------------------------------
5-Year 3.63% 5.24%
--------------------------------------------------
10-Year 6.34% 6.38%
--------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
--------------------------------------------------
Healthcare 17%
--------------------------------------------------
Tax Obligation/Limited 16%
--------------------------------------------------
U.S. Guaranteed 15%
--------------------------------------------------
Transportation 14%
--------------------------------------------------
Utilities 10%
--------------------------------------------------
Bar Chart:
2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Apr 0.062
May 0.062
Jun 0.062
Jul 0.062
Aug 0.062
Sep 0.061
Oct 0.061
Nov 0.061
Dec 0.061
Jan 0.061
Feb 0.061
Mar 0.061
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
4/1/03 13.86
13.9
13.95
13.9
14.14
14.07
14.13
14.6
14.42
14.49
14.5
14.51
14.28
13.76
13.41
13.84
13.6
13.5
13.51
13.85
13.9
13.82
13.98
13.88
13.7
13.75
13.7
13.61
13.72
13.66
13.77
13.5
13.49
13.65
13.78
13.92
13.94
13.9
14.1
14.43
14.2
14.07
14.08
14.36
14.23
3/31/04 14.29
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. For
investments that generate qualified dividend income, the taxable-equivalent
yield is lower.
2 The Fund also paid shareholders capital gains and net ordinary income
distributions in December 2003 of $0.1059 per share.
7
Nuveen Select Tax-Free Income Portfolio 2
Performance
OVERVIEW As of March 31, 2004
NXQ
Pie Chart:
CREDIT QUALITY
AAA/U.S. Guaranteed 54%
AA 25%
A 9%
BBB 11%
BB or lower 1%
FUND SNAPSHOT
--------------------------------------------------
Share Price $13.80
--------------------------------------------------
Common Share Net Asset Value $14.56
--------------------------------------------------
Premium/(Discount) to NAV -5.22%
--------------------------------------------------
Market Yield 5.09%
--------------------------------------------------
Taxable-Equivalent Yield1 7.07%
--------------------------------------------------
Net Assets ($000) $256,373
--------------------------------------------------
Average Effective Maturity (Years) 17.16
--------------------------------------------------
Duration 5.13
--------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN (Inception 5/21/92)
--------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------
1-Year 8.35% 6.31%
--------------------------------------------------
5-Year 3.49% 4.88%
--------------------------------------------------
10-Year 6.36% 6.11%
--------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
--------------------------------------------------
Transportation 16%
--------------------------------------------------
Healthcare 16%
--------------------------------------------------
Utilities 15%
--------------------------------------------------
Tax Obligation/Limited 13%
--------------------------------------------------
U.S. Guaranteed 10%
--------------------------------------------------
Bar Chart:
2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Apr 0.0605
May 0.0605
Jun 0.0605
Jul 0.0605
Aug 0.0605
Sep 0.0585
Oct 0.0585
Nov 0.0585
Dec 0.0585
Jan 0.0585
Feb 0.0585
Mar 0.0585
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
4/1/03 13.36
13.36
13.44
13.38
13.53
13.68
13.8
13.87
14.03
14.03
14.05
14.01
13.89
13.75
13.18
13.31
13.04
13.02
13.06
13.2
13.15
13.23
13.2
13.15
13.15
13.14
13.13
13.18
13.24
13.18
13.25
13.2
13.21
13.27
13.45
13.45
13.53
13.5
13.55
13.73
13.67
13.65
13.76
13.79
13.79
3/31/04 13.82
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. For
investments that generate qualified dividend income, the taxable-equivalent
yield is lower.
2 The Fund also paid shareholders capital gains and net ordinary income
distributions in December 2003 of $0.0646 per share.
8
Nuveen Select Tax-Free Income Portfolio 3
Performance
OVERVIEW As of March 31, 2004
NXR
Pie Chart:
CREDIT QUALITY
AAA/U.S. Guaranteed 44%
AA 27%
A 20%
BBB 9%
FUND SNAPSHOT
--------------------------------------------------
Share Price $13.56
--------------------------------------------------
Common Share Net Asset Value $14.37
--------------------------------------------------
Premium/(Discount) to NAV -5.64%
--------------------------------------------------
Market Yield 5.09%
--------------------------------------------------
Taxable-Equivalent Yield1 7.07%
--------------------------------------------------
Net Assets ($000) $186,358
--------------------------------------------------
Average Effective Maturity (Years) 16.32
--------------------------------------------------
Duration 5.19
--------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN (Inception 7/24/92)
--------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------
1-Year 9.96% 6.13%
--------------------------------------------------
5-Year 3.68% 4.86%
--------------------------------------------------
10-Year 6.18% 6.25%
--------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
--------------------------------------------------
Utilities 22%
--------------------------------------------------
Healthcare 18%
--------------------------------------------------
Tax Obligation/Limited 12%
--------------------------------------------------
Tax Obligation/General 8%
--------------------------------------------------
U.S. Guaranteed 8%
--------------------------------------------------
Bar Chart:
2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Apr 0.0575
May 0.0575
Jun 0.0575
Jul 0.0575
Aug 0.0575
Sep 0.0575
Oct 0.0575
Nov 0.0575
Dec 0.0575
Jan 0.0575
Feb 0.0575
Mar 0.0575
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
4/1/03 12.98
12.97
13.05
13.14
13.21
13.31
13.45
13.57
13.77
13.76
13.66
13.64
13.56
13.05
13.05
13.02
12.77
12.77
12.85
12.87
12.92
12.94
13
12.87
12.8
13
12.97
12.92
12.89
13
13.02
13.06
12.92
13.11
13.29
13.33
13.4
13.26
13.55
13.59
13.45
13.51
13.67
13.68
13.61
3/31/04 13.55
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a federal income tax rate of 28%. For
investments that generate qualified dividend income, the taxable-equivalent
yield is lower.
2 The Fund also paid shareholders capital gains and net ordinary income
distributions in December 2003 of $0.0719 per share.
9
Nuveen California Select Tax-Free Income Portfolio
Performance
OVERVIEW As of March 31, 2004
NXC
Pie Chart:
CREDIT QUALITY
AAA/U.S. Guaranteed 66%
AA 3%
A 17%
BBB 14%
FUND SNAPSHOT
--------------------------------------------------
Share Price $14.06
--------------------------------------------------
Common Share Net Asset Value $14.68
--------------------------------------------------
Premium/(Discount) to NAV -4.22%
--------------------------------------------------
Market Yield 4.78%
--------------------------------------------------
Taxable-Equivalent Yield1 6.64%
--------------------------------------------------
Net Assets ($000) $91,864
--------------------------------------------------
Average Effective Maturity (Years) 17.44
--------------------------------------------------
Duration 6.69
--------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN (Inception 6/19/92)
--------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------
1-Year 9.14% 6.16%
--------------------------------------------------
5-Year 3.42% 4.80%
--------------------------------------------------
10-Year 5.83% 6.20%
--------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
--------------------------------------------------
Tax Obligation/General 22%
--------------------------------------------------
Transportation 15%
--------------------------------------------------
Healthcare 15%
--------------------------------------------------
Education and Civic Organizations 14%
--------------------------------------------------
Water and Sewer 11%
--------------------------------------------------
Bar Chart:
2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Apr 0.057
May 0.057
Jun 0.057
Jul 0.057
Aug 0.057
Sep 0.056
Oct 0.056
Nov 0.056
Dec 0.056
Jan 0.056
Feb 0.056
Mar 0.056
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
4/1/03 13.86
13.9
13.95
13.9
14.14
14.07
14.13
14.6
14.42
14.49
14.5
14.51
14.28
13.76
13.41
13.84
13.6
13.5
13.51
13.85
13.9
13.82
13.98
13.88
13.7
13.75
13.7
13.61
13.72
13.66
13.77
13.5
13.49
13.65
13.78
13.92
13.94
13.9
14.1
14.43
14.2
14.07
14.08
14.36
14.23
3/31/04 14.29
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 34.5%. For investments that generate qualified dividend income, the
taxable-equivalent yield is lower.
2 The Fund also paid shareholders capital gains and net ordinary income
distributions in December 2003 of $0.0540 per share.
10
Nuveen New York Select Tax-Free Income Portfolio
Performance
OVERVIEW As of March 31, 2004
NXN
Pie Chart:
CREDIT QUALITY
AAA/U.S. Guaranteed 81%
AA 15%
BBB 4%
FUND SNAPSHOT
--------------------------------------------------
Share Price $14.40
--------------------------------------------------
Common Share Net Asset Value $14.57
--------------------------------------------------
Premium/(Discount) to NAV -1.17%
--------------------------------------------------
Market Yield 4.67%
--------------------------------------------------
Taxable-Equivalent Yield1 6.49%
--------------------------------------------------
Net Assets ($000) $56,958
--------------------------------------------------
Average Effective Maturity (Years) 17.61
--------------------------------------------------
Duration 5.76
--------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN (Inception 6/19/92)
--------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------
1-Year 11.81% 5.84%
--------------------------------------------------
5-Year 4.72% 4.97%
--------------------------------------------------
10-Year 6.44% 6.03%
--------------------------------------------------
TOP FIVE SECTORS (as a % of total investments)
--------------------------------------------------
Tax Obligation/Limited 13%
--------------------------------------------------
Education and Civic Organizations 13%
--------------------------------------------------
Water and Sewer 12%
--------------------------------------------------
Healthcare 10%
--------------------------------------------------
Long-Term Care 9%
--------------------------------------------------
Bar Chart:
2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2
Apr 0.057
May 0.057
Jun 0.057
Jul 0.057
Aug 0.057
Sep 0.057
Oct 0.057
Nov 0.057
Dec 0.057
Jan 0.057
Feb 0.057
Mar 0.056
Line Chart:
SHARE PRICE PERFORMANCE
Weekly Closing Price
Past performance is not predictive of future results.
4/1/03 13.4
13.41
13.47
13.5
13.43
13.9
14.06
14.54
14.6
14.5
14.49
14.29
14.4
13.99
13.64
13.54
13.15
13.61
13.59
13.59
13.48
13.6
13.52
13.5
13.45
13.52
13.56
13.5
13.48
13.56
13.56
13.53
13.62
14.44
14.33
14.7
14.74
14.37
14.38
14.76
14.8
14.35
14.59
14.58
14.57
3/31/04 14.44
1 Taxable-equivalent yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 33.5%. For investments that generate qualified dividend income, the
taxable-equivalent yield is lower.
2 The Fund also paid shareholders capital gains distributions in December
2003 of $0.0726 per share.
11
Report of
INDEPENDENT AUDITORS
THE BOARD OF TRUSTEES AND SHAREHOLDERS
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 2
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 3
NUVEEN CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO
NUVEEN NEW YORK SELECT TAX-FREE INCOME PORTFOLIO
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Nuveen Select Tax-Free Income Portfolio,
Nuveen Select Tax-Free Income Portfolio 2, Nuveen Select Tax-Free Income
Portfolio 3, Nuveen California Select Tax-Free Income Portfolio, and Nuveen New
York Select Tax-Free Income Portfolio as of March 31, 2004, and the related
statements of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended and the financial
highlights for each of the five years in the period then ended. These financial
statements and financial highlights are the responsibility of the Trusts'
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 investments owned as of March 31, 2004, 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 Select Tax-Free Income Portfolio, Nuveen Select Tax-Free Income Portfolio
2, Nuveen Select Tax-Free Income Portfolio 3, Nuveen California Select Tax-Free
Income Portfolio, and Nuveen New York Select Tax-Free Income Portfolio at March
31, 2004, and the results of their operations for the year then ended, the
changes in their net assets for each of the two years in the period then ended
and the financial highlights for each of the five years in the period then ended
in conformity with accounting principles generally accepted in the United
States.
Ernst & Young LLP
Chicago, Illinois
May 14, 2004
12
Nuveen Select Tax-Free Income Portfolio (NXP)
Portfolio of
INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALASKA - 1.1%
$ 2,475 Alaska Municipal Bond Bank Authority, General Obligation 12/13 at 100.00 AAA $ 2,668,372
Bonds, Series 2003E, 5.250%, 12/01/23 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 5.3%
3,325 California Department of Water Resources, Power Supply 5/12 at 101.00 A3 3,850,383
Revenue Bonds, Series 2002A, 6.000%, 5/01/14
3,000 California State Public Works Board, Lease Revenue 11/04 at 102.00 Aaa 3,162,210
Bonds, Department of Corrections, Soledad II State Prison,
Series 1994A, 6.875%, 11/01/14 (Pre-refunded to 11/01/04)
1,450 California Statewide Community Development 8/04 at 100.00 A3 1,469,807
Authority, Hospital Revenue Certificates of Participation,
Cedars-Sinai Medical Center, Series 1992, 6.500%, 8/01/15
200 Contra Costa County, California, Refunding Certificates 11/07 at 102.00 AAA 221,000
of Participation, Merrithew Memorial Hospital Replacement
Project, Series 1997, 5.375%, 11/01/17 - MBIA Insured
3,000 Golden State Tobacco Securitization Corporation, 6/13 at 100.00 BBB 2,969,760
California, Tobacco Settlement Asset-Backed Bonds,
Series 2003A-1, 6.750%, 6/01/39
1,130 Los Angeles Department of Water and Power, 7/11 at 100.00 AAA 1,168,533
California, Waterworks Revenue Refunding Bonds,
Series 2001A, 5.125%, 7/01/41 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 13.1%
3,000 Colorado Health Facilities Authority, Revenue Bonds, 9/12 at 100.00 AA 3,174,270
Catholic Health Initiatives, Series 2002A, 5.500%, 3/01/22
1,000 Colorado Water Resources and Power Development 11/10 at 100.00 AAA 1,146,440
Authority, Small Water Resources Revenue Bonds,
Series 2000A, 5.800%, 11/01/20 - FGIC Insured
5,000 Denver City and County, Colorado, Airport System 11/11 at 100.00 AAA 5,505,250
Revenue Refunding Bonds, Series 2001B, 5.625%, 11/15/17
(Alternative Minimum Tax) - FGIC Insured
10,750 Denver City and County, Colorado, Airport System No Opt. Call A 13,260,878
Revenue Bonds, Series 1991D, 7.750%, 11/15/13
(Alternative Minimum Tax)
Denver Convention Center Hotel Authority, Colorado, Convention
Center Hotel Senior Revenue Bonds, Series 2003A:
1,000 5.000%, 12/01/22 - XLCA Insured 12/13 at 100.00 AAA 1,053,620
3,000 5.000%, 12/01/23 - XLCA Insured 12/13 at 100.00 AAA 3,131,910
5,000 E-470 Public Highway Authority, Colorado, Senior 9/10 at 31.42 AAA 1,201,600
Revenue Bonds, Series 2000A, 0.000%, 9/01/28 -
MBIA Insured
3,160 Northwest Parkway Public Highway Authority, 6/11 at 102.00 AAA 3,493,949
Colorado, Revenue Bonds, Senior Series 2001A,
5.500%, 6/15/20 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.5%
1,000 District of Columbia, Hospital Revenue Refunding 8/06 at 102.00 AAA 1,108,240
Bonds, Medlantic Healthcare Group Issue, Series 1996A,
5.750%, 8/15/16 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 7.0%
250 Escambia County, Florida, Pollution Control Revenue 6/04 at 102.00 BBB 253,298
Bonds, Champion International Corporation Project,
Series 1993, 5.875%, 6/01/22 (Alternative Minimum Tax)
10,000 JEA, St. John's River Power Park System, Florida, 10/11 at 100.00 AA 10,679,200
Revenue Refunding Bonds, Issue 2, Series 2002-17,
5.000%, 10/01/17
6,100 JEA, St. John's River Power Park System, Florida, No Opt. Call AA 6,115,494
Revenue Refunding Bonds, Issue 2, Series Nine,
5.250%, 10/01/21
13
Nuveen Select Tax-Free Income Portfolio (NXP) (continued)
Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 0.6%
$ 1,330 Hawaii, Certificates of Participation, Kapolei State 11/08 at 101.00 AAA $ 1,427,689
Office Building, Series 1998A, 5.000%, 5/01/17 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 13.2%
Chicago Heights, Illinois, General Obligation Corporate
Purpose Bonds, Series 1993:
3,820 5.650%, 12/01/15 - FGIC Insured 12/08 at 100.00 AAA 4,310,488
2,600 5.650%, 12/01/17 - FGIC Insured 12/08 at 100.00 AAA 2,930,200
2,500 Chicago, Illinois, Special Facility Revenue Refunding No Opt. Call N/R 775,000
Bonds, O'Hare International Airport, United Air Lines,
Inc. Project, Series 2001C, 6.300%, 5/01/16#
1,000 Illinois Educational Facilities Authority, Revenue Bonds, 5/08 at 101.00 A 1,043,400
Midwestern University, Series 1998B, 5.500%, 5/15/18 -
ACA Insured
1,960 Illinois Health Facilities Authority, Revenue Refunding No Opt. Call N/R*** 2,157,627
Bonds, Evangelical Hospitals Corporation,
Series 1992B, 6.500%, 4/15/09
1,320 Illinois Health Facilities Authority, Revenue Bonds, 10/11 at 100.00 A 1,412,862
Decatur Memorial Hospital, Series 2001, 5.600%, 10/01/16
2,700 Illinois Health Facilities Authority, Revenue Bonds, 7/12 at 100.00 A- 3,016,764
Lake Forest Hospital, Series 2002A, 6.000%, 7/01/17
2,225 Illinois Health Facilities Authority, Revenue Refunding 1/13 at 100.00 A2 2,518,500
Bonds, Elmhurst Memorial Healthcare, Series 2002,
6.250%, 1/01/17
800 Illinois Housing Development Authority, Homeowner 2/10 at 100.00 AA 865,888
Mortgage Revenue Bonds, Series 2000D-3,
5.700%, 8/01/17
1,500 Illinois Housing Development Authority, Homeowner 7/10 at 100.00 AA 1,631,295
Mortgage Revenue Bonds, Series 1999G-1,
5.700%, 8/01/17
600 Illinois Educational Facilities Authority, Student Housing 5/12 at 101.00 Baa2 618,378
Revenue Bonds, Educational Advancement Foundation
Fund, University Center Project, Series 2002,
6.000%, 5/01/22
2,000 Illinois, General Obligation Bonds, Series 1994, 8/04 at 102.00 Aa3*** 2,072,200
5.875%, 8/01/14 (Pre-refunded to 8/01/04)
3,125 Metropolitan Pier and Exposition Authority, Illinois, No Opt. Call AAA 1,725,156
McCormick Place Expansion Project Bonds,
Series 1992A, 0.000%, 6/15/17 - FGIC Insured
5,000 Metropolitan Pier and Exposition Authority, Illinois, 6/12 at 101.00 AAA 5,292,700
Refunding Bonds, McCormick Place Expansion Project,
Series 2002B, 5.000%, 6/15/21 - MBIA Insured
Yorkville United City, Illinois, General Obligation Debt
Certificates, Series 2003:
1,000 5.000%, 12/15/19 - RAAI Insured 12/11 at 100.00 AA 1,031,200
1,000 5.000%, 12/15/20 - RAAI Insured 12/11 at 100.00 AA 1,027,270
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 7.6%
5,000 Duneland School Building Corporation, Indiana, First 2/09 at 101.00 AAA 5,366,250
Mortgage Refunding Bonds, Series 1999,
5.125%, 2/01/18 - MBIA Insured
2,000 Indiana Health Facility Financing Authority, Hospital No Opt. Call AAA 2,529,740
Revenue Refunding Bonds, Columbus Regional
Hospital, Series 1993, 7.000%, 8/15/15 - FSA Insured
9,855 Indianapolis Local Public Improvement Bond Bank, 7/12 at 100.00 AAA 10,517,749
Indiana, Waterworks Project, Series 2002A,
5.125%, 7/01/21 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 1.7%
4,030 Wichita, Kansas, Revenue Bonds, CSJ Health System 5/04 at 100.00 A+*** 4,051,722
of Wichita, Inc., Series 1985-XXV, 7.200%, 10/01/15
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 1.9%
1,100 Jefferson County, Kentucky, Health System Revenue 10/08 at 101.00 AAA 1,161,336
Bonds, Alliant Health System, Inc., Series 1998,
5.125%, 10/01/18 - MBIA Insured
3,230 Lexington-Fayette Urban County Government, 11/04 at 102.00 AAA 3,401,771
Kentucky, Revenue Bonds, University of Kentucky
Alumni Association Project, Series 1994, 6.750%, 11/01/15
(Pre-refunded to 11/01/04) - MBIA Insured
14
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 0.2%
$ 500 Massachusetts Health and Educational Facilities 7/11 at 101.00 AA- $ 563,925
Authority, Revenue Bonds, Partners HealthCare
System, Inc., Series 2001C, 6.000%, 7/01/17
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 1.8%
665 City of Detroit, Michigan, Water Supply System 7/05 at 102.00 AAA 696,707
Revenue Bonds, Second Lien, Series 1995A,
5.500%, 7/01/25 - MBIA Insured
2,900 Michigan State Hospital Finance Authority, Revenue 12/12 at 100.00 AA- 3,030,500
Refunding Bonds, Trinity Health Credit Group,
Series 2002C, 5.375%, 12/01/30
1,000 Michigan State Hospital Finance Authority, Hospital 8/08 at 101.00 Ba3 729,510
Revenue Bonds, Detroit Medical Center Obligated
Group, Series 1998A, 5.125%, 8/15/18
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 0.3%
670 Minnesota Housing Finance Agency, Single Family 7/08 at 101.00 AA+ 705,068
Mortgage Revenue Bonds, Series 1995A, 5.200%, 1/01/17
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 1.6%
3,600 Calhoun County, Mississippi, Solid Waste Disposal 4/07 at 103.00 BBB 3,929,292
Revenue Bonds, Weyerhauser Company Project,
Series 1992, 6.875%, 4/01/16 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 6.6%
2,500 Clark County, Nevada, Motor Vehicle Fuel Tax Highway 7/13 at 100.00 AAA 2,621,525
Improvement Revenue Bonds, Series 2003,
5.000%, 7/01/23 - AMBAC Insured
State Department of Business and Industry, Director of Nevada,
Revenue Bonds, Las Vegas Monorail Project, First Tier Series
2000:
2,360 0.000%, 1/01/21 - AMBAC Insured No Opt. Call AAA 1,031,957
3,500 0.000%, 1/01/22 - AMBAC Insured No Opt. Call AAA 1,439,165
6,025 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 AAA 6,394,935
4,070 Reno, Nevada, Capital Improvement Revenue Bonds, 6/12 at 100.00 AAA 4,491,815
Series 2002, 5.500%, 6/01/21 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.4%
985 New Hampshire Housing Finance Agency, Single Family 5/11 at 100.00 Aa2 1,047,144
Mortgage Acquisition Bonds, Series 2001A,
5.600%, 7/01/21 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 1.1%
2,500 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Baa2 2,583,050
Revenue Bonds, Somerset Medical Center, Series 2003,
5.500%, 7/01/23
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 3.5%
450 Long Island Power Authority, New York, Electric 6/08 at 101.00 AAA 474,498
System General Revenue Bonds, Series 1998A,
5.125%, 12/01/22 - FSA Insured
5,170 New York City, New York, General Obligation Bonds, 8/04 at 101.50 Aaa 5,337,301
Fiscal Series 1995A, 6.250%, 8/01/10
(Pre-refunded to 8/01/04)
1,000 Dormitory Authority of the State of New York, Revenue 7/04 at 102.00 AAA 1,023,070
Bonds, Columbia University, Series 1994A,
4.750%, 7/01/14
1,600 Dormitory Authority of the State of New York, Revenue 7/10 at 101.00 Ba1 1,642,512
Bonds, Mount Sinai NYU Health Obligated Group,
Series 2000A, 6.500%, 7/01/17
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 0.8%
1,330 North Carolina Eastern Municipal Power Agency, Power No Opt. Call BBB 1,330,652
System Revenue Refunding Bonds, Series 1993B,
5.500%, 1/01/21
500 Raleigh Durham Airport Authority, North Carolina, 5/11 at 101.00 Aaa 549,120
Airport Revenue Bonds, Series 2001A,
5.250%, 11/01/17 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 0.7%
1,575 Ohio Housing Finance Agency, GNMA Mortgage-Backed 9/07 at 102.00 Aaa 1,684,100
Securities Program, Residential Mortgage Remarketed
Revenue Bonds, Series 1997A-1, 6.050%, 9/01/17
(Alternative Minimum Tax)
15
Nuveen Select Tax-Free Income Portfolio (NXP) (continued)
Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 0.2%
$ 500 Pennsylvania Higher Educational Facilities Authority, 7/13 at 100.00 BBB+ $ 510,835
Revenue Bonds, Widner University, Series 2003,
5.250%, 7/15/24
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 7.0%
10,000 Greenville County School District, South Carolina, 12/12 at 101.00 AA- 11,232,800
Installment Purchase Revenue Bonds, Series 2002,
5.875%, 12/01/19
1,500 Lexington County Health Service District, South Carolina, 11/13 at 100.00 A 1,679,100
Hospital Revenue Refunding and Improvement Bonds,
Series 2003, 6.000%, 11/01/18
2,500 South Carolina JOBS Economic Development Authority, 11/12 at 100.00 A- 2,561,575
Revenue Bonds, Bon Secours Health System, Inc.,
Series 2002A, 5.625%, 11/15/30
1,500 Tobacco Settlement Revenue Management Authority, 5/11 at 101.00 BBB 1,429,110
South Carolina, Tobacco Settlement Asset-Backed
Bonds, Series 2001B, 6.000%, 5/15/22
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 9.6%
5,000 Brazos River Harbor Navigation District, Brazoria 5/12 at 101.00 A- 5,668,150
County, Texas, Environmental Facilities Revenue
Bonds, Dow Chemical Company Project, Series 2002A-6,
6.250%, 5/15/33 (Alternative Minimum Tax)
(Mandatory put 5/15/17)
6,150 Dallas Independent School District, Dallas County, 2/12 at 100.00 AAA 6,649,380
Texas, General Obligation Refunding Bonds,
Series 2002, 5.250%, 2/15/20
4,370 Harris County Health Facilities Development 6/04 at 100.00 A3*** 4,414,093
Corporation, Texas, Hospital Revenue Bonds,
Memorial Hermann Healthcare System, Series 1992,
7.125%, 6/01/15 (Pre-refunded to 6/01/04)
2,300 Harris County Health Facilities Development 11/13 at 100.00 AAA 2,369,851
Corporation, Texas, Thermal Utility Revenue Bonds,
TECO Project, Series 2003, 5.000%, 11/15/30 -
MBIA Insured
3,500 Irving Independent School District, Dallas County, 2/12 at 100.00 AAA 3,613,575
Texas, General Obligation Refunding Bonds,
Series 2002A, 5.000%, 2/15/31
San Antonio, Texas, Water System Revenue Refunding
Bonds, Series 1992:
95 6.000%, 5/15/16 (Pre-refunded to 5/15/07) - MBIA Insured 5/07 at 100.00 AAA 107,062
465 6.000%, 5/15/16 - MBIA Insured No Opt. Call AAA 550,965
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 9.2%
5,700 Snohomish County Public Utility District 1, Washington, 7/04 at 100.00 Aaa 6,795,996
Generation System Revenue Bonds, Series 1989,
6.750%, 1/01/12
2,000 Washington State Tobacco Settlement Authority, 6/13 at 100.00 BBB 1,976,640
Tobacco Settlement Asset-Backed Revenue Bonds,
Series 2002, 6.500%, 6/01/26
3,000 Washington State Healthcare Facilities Authority, 12/07 at 101.00 AAA 3,185,520
Revenue Bonds, Catholic Health Initiatives,
Series 1997A, 5.125%, 12/01/17 - MBIA Insured
9,750 Washington State Healthcare Facilities Authority, 10/11 at 100.00 AAA 10,425,383
Revenue Bonds, Sisters of Providence Health System,
Series 2001A, 5.125%, 10/01/17 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 0.9%
1,885 Marshall County, West Virginia, Special Obligation No Opt. Call AAA 2,203,166
Refunding Bonds, Series 1992, 6.500%, 5/15/10
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.5%
2,500 Wisconsin, General Obligation Refunding Bonds, 11/13 at 100.00 AA- 2,605,250
Series 2003-3, 5.000%, 11/01/26
1,000 Wisconsin Health and Educational Facilities Authority, 8/13 at 100.00 A 1,086,480
Revenue Bonds, Wheaton Franciscan Services, Inc.,
Series 2003A, 5.500%, 8/15/17
------------------------------------------------------------------------------------------------------------------------------------
$ 230,150 Total Long-Term Investments (cost $221,802,927) - 97.4% 236,890,176
=============-----------------------------------------------------------------------------------------------------------------------
16
PRINCIPAL MARKET
AMOUNT (000) DESCRIPTION RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.8%
$ 2,000 Nebraska Educational Finance Authority, Variable Rate VMIG-1 $ 2,000,000
Demand Revenue Refunding Bonds, Creighton
University, Series 2001, 1.120%, 8/01/31+
------------------------------------------------------------------------------------------------------------------------------------
$ 2,000 Total Short-Term Investments (cost $2,000,000) 2,000,000
=============-----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $223,802,927) - 98.2% 238,890,176
--------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.8% 4,275,002
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 243,165,178
====================================================================================================================
* 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. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# On December 9, 2002, UALCorporation, the holding
company of United Air Lines, Inc. filed for federal
bankruptcy protection. The Adviser determined that it
was likely United would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
+ 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.
17
Nuveen Select Tax-Free Income Portfolio 2 (NXQ)
Portfolio of
INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 1.6%
$ 1,000 Fort Smith, Arkansas, Water and Sewer Revenue Refunding 10/11 at 100.00 AAA $ 1,067,050
and Construction Bonds, Series 2002A, 5.000%, 10/01/19 -
FSA Insured
1,000 Sebastian County Health Facilities Board, Arkansas, 11/11 at 101.00 Baa1 1,017,580
Hospital Revenue Improvement Bonds, Sparks Regional
Medical Center, Series 2001A, 5.250%, 11/01/21
2,000 University of Arkansas, Fayetteville, Various Facilities 12/12 at 100.00 Aaa 2,079,140
Revenue Bonds, Series 2002, 5.000%, 12/01/32 -
FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 6.2%
3,325 California Department of Water Resources, Power Supply 5/12 at 101.00 A3 3,850,383
Revenue Bonds, Series 2002A, 6.000%, 5/01/14
2,000 California State Public Works Board, Lease Revenue No Opt. Call Aa2 2,295,140
Refunding Bonds, Various University of California
Projects, Series 1993A, 5.500%, 6/01/14
5,000 California State Public Works Board, Lease Revenue 11/04 at 102.00 Aaa 5,270,350
Bonds, Department of Corrections, Soledad II State
Prison, Series 1994A, 6.875%, 11/01/14 (Pre-refunded
to 11/01/04)
500 California State Public Works Board, Lease Revenue 12/08 at 101.00 Baa2 523,850
Refunding Bonds, Various California Community
College Projects, Series 1998A, 5.250%, 12/01/16
500 Contra Costa Water District, California, Water Revenue 10/07 at 100.00 AA 538,580
Refunding Bonds, Series 1997H, 5.000%, 10/01/17
500 Contra Costa County, California, Refunding Certificates 11/07 at 102.00 AAA 552,500
of Participation, Merrithew Memorial Hospital
Replacement Project, Series 1997, 5.375%, 11/01/17 -
MBIA Insured
3,000 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 BBB 2,969,760
Tobacco Settlement Asset-Backed Bonds, Series 2003A-1,
6.750%, 6/01/39
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 7.8%
3,000 Colorado Health Facilities Authority, Revenue Bonds, 9/12 at 100.00 AA 3,174,270
Catholic Health Initiatives, Series 2002A,
5.500%, 3/01/22
5,000 Denver City and County, Colorado, Airport System Revenue , 11/11 at 100.00 AAA 5,505,250
Refunding Bonds, Series 2001B, 5.625% 11/15/17
(Alternative Minimum Tax) - FGIC Insured
3,185 Denver City and County, Colorado, Airport System No Opt. Call A 3,928,920
Revenue Bonds, Series 1991D, 7.750%, 11/15/13
(Alternative Minimum Tax)
3,000 Denver Convention Center Hotel Authority, Colorado, 12/13 at 100.00 AAA 3,131,910
Convention Center Hotel Senior Revenue Bonds,
Series 2003A, 5.000%, 12/01/23 - XLCA Insured
5,000 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 1,777,600
Bonds, Series 2000B, 0.000%, 9/01/24 - MBIA Insured
5,000 E-470 Public Highway Authority, Colorado, Senior Revenue 9/10 at 31.42 AAA 1,201,600
Bonds, Series 2000A, 0.000%, 9/01/28 - MBIA Insured
250 Northwest Parkway Public Highway Authority, Colorado, 6/11 at 102.00 AAA 264,278
Revenue Bonds, Senior Series 2001A, 5.250%, 6/15/41 -
FSA Insured
1,100 University of Colorado Hospital Authority, Hospital 11/11 at 100.00 A3 1,138,940
Revenue Bonds, Series 2001A, 5.600%, 11/15/31
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.2%
500 District of Columbia, Hospital Revenue Refunding Bonds, 8/06 at 102.00 AAA 554,120
Medlantic Healthcare Group Issue, Series 1996A,
5.750%, 8/15/16 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 2.4%
6,060 JEA, St. John's River Power Park System, Florida, Revenue No Opt. Call AA 6,075,392
Refunding Bonds, Issue 2, Series Nine, 5.250%, 10/01/21
18
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 0.5%
$ 1,100 Hawaii, Certificates of Participation, Kapolei State Office 11/08 at 101.00 AAA $ 1,180,795
Building, Series 1998A, 5.000%, 5/01/17 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 16.7%
8,420 Chicago Metropolitan Housing Development Corporation, 7/04 at 100.00 AA 8,463,616
Illinois, FHA-Insured Section 8 Housing Development
Revenue Refunding Bonds, Series 1992, 6.800%, 7/01/17
2,400 Chicago, Illinois, Special Facility Revenue Refunding No Opt. Call N/R 744,000
Bonds, O'Hare International Airport, United Air Lines, Inc.
Project, Series 2001C, 6.300%, 5/01/16#
250 Illinois Development Finance Authority, Economic 8/08 at 100.00 Baa2 263,337
Development Revenue Bonds, Latin School of Chicago
Project, Series 1998, 5.200%, 8/01/11
Illinois Educational Facilities Authority, Revenue Refunding
Bonds, Columbia College, Series 1992:
2,610 6.875%, 12/01/17 (Pre-refunded to 12/01/04) 12/04 at 100.00 N/R*** 2,710,276
1,140 6.875%, 12/01/17 12/04 at 100.00 BBB 1,156,735
3,000 Illinois Health Facilities Authority, Revenue Bonds, 5/04 at 102.00 AAA 3,066,780
Rush-Presbyterian St. Luke's Medical Center Obligated
Group, Series 1993, 5.250%, 11/15/20 - MBIA Insured
805 Illinois Health Facilities Authority, Revenue Bonds, 7/11 at 100.00 Baa1 835,638
Loyola University Health System, Series 2001A,
6.125%, 7/01/31
2,255 Illinois Health Facilities Authority, Revenue Bonds, 7/12 at 100.00 A- 2,502,125
Lake Forest Hospital, Series 2002A, 6.250%, 7/01/22
1,900 Illinois Housing Development Authority, Homeowner 2/10 at 100.00 AA 2,056,484
Mortgage Revenue Bonds, Series 2000D-3,
5.700%, 8/01/17
600 Illinois Educational Facilities Authority, Student Housing 5/12 at 101.00 Baa2 618,378
Revenue Bonds, Educational Advancement Foundation
Fund, University Center Project, Series 2002,
6.000%, 5/01/22
5,700 Illinois, Sales Tax Revenue Bonds, First 6/13 at 100.00 AAA 6,015,837
Series 2002, 5.000%, 6/15/22
45 Metropolitan Pier and Exposition Authority, Illinois, 6/04 at 101.00 A1 45,988
McCormick Place Expansion Project Bonds, Series 1992A,
6.500%, 6/15/22
7,000 Metropolitan Pier and Exposition Authority, Illinois, 6/12 at 101.00 AAA 7,409,780
McCormick Place Expansion Project Refunding Bonds,
Series 2002B, 5.000%, 6/15/21 - MBIA Insured
5,045 Sauk Village, Illinois, General Obligation Alternate 12/12 at 100.00 AA 5,156,797
Revenue Source Bonds, Tax Increment, Series 2002A,
5.000%, 6/01/22 - RAAI Insured
Sauk Village, Illinois, General Obligation Alternate Revenue
Source Bonds, Tax Increment, Series 2002B:
1,060 0.000%, 12/01/17 - RAAI Insured No Opt. Call AA 530,466
1,135 0.000%, 12/01/18 - RAAI Insured No Opt. Call AA 530,919
1,000 Yorkville United City, Illinois, General Obligation Debt 12/11 at 100.00 AA 1,024,010
Certificates, Series 2003, 5.000%, 12/15/21 -
RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 2.6%
4,380 Indiana Municipal Power Agency, Power Supply System 1/12 at 100.00 AAA 4,644,464
Revenue Bonds, Series 2002A, 5.125%, 1/01/21 -
AMBAC Insured
1,840 Indiana Housing Finance Authority, Single Family Mortgage 7/11 at 100.00 Aaa 1,936,048
Revenue Bonds, Series 2002C-2, 5.250%, 7/01/23
(Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 1.5%
Iowa Tobacco Settlement Authority, Tobacco Settlement
Asset-Backed Revenue Bonds, Series 2001B:
1,000 5.300%, 6/01/25 6/11 at 101.00 BBB 867,610
3,500 5.600%, 6/01/35 6/11 at 101.00 BBB 2,972,690
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 1.2%
3,000 Louisiana Public Facilities Authority, Revenue Bonds, Tulane 7/12 at 100.00 AAA 3,152,520
University, Series 2002A, 5.125%, 7/01/27 -
AMBAC Insured
19
Nuveen Select Tax-Free Income Portfolio 2 (NXQ) (continued)
Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 2.2%
$ 3,000 Massachusetts Health and Educational Facilities Authority, 10/11 at 101.00 BBB+ $ 3,148,620
Revenue Bonds, Berkshire Health System, Series 2001E,
6.250%, 10/01/31
2,090 Massachusetts Water Resources Authority, General No Opt. Call AAA 2,383,290
Revenue Bonds, Series 1993C, 5.250%, 12/01/15 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 2.0%
2,900 Michigan State Hospital Finance Authority, Revenue 12/12 at 100.00 AA- 3,030,500
Refunding Bonds, Trinity Health Credit Group,
Series 2002C, 5.375%, 12/01/30
2,000 Plymouth-Canton Community School District, Wayne 5/09 at 100.00 AA+ 2,066,180
and Washtenaw Counties, Michigan, Unlimited Tax
General Obligation School Building and Site Bonds,
Series 1999, 4.750%, 5/01/18
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 5.7%
500 Clark County, Nevada, Limited Tax General Obligation 7/06 at 101.00 AAA 542,270
Las Vegas Convention and Visitors Authority Bonds,
Series 1996, 5.500%, 7/01/17 - MBIA Insured
13,250 State Department of Business and Industry, Director 1/10 at 100.00 AAA 14,063,550
of Nevada, Revenue Bonds, Las Vegas Monorail
Project, First Tier, Series 2000, 5.375%, 1/01/40 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 1.0%
2,500 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Baa2 2,583,050
Revenue Bonds, Somerset Medical Center, Series 2003,
5.500%, 7/01/23
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 6.1%
2,700 Dormitory Authority of the State of New York, Revenue 7/10 at 101.00 Ba1 2,771,739
Bonds, Mount Sinai NYU Health Obligated Group,
Series 2000A, 6.500%, 7/01/17
4,000 New York State Medical Care Facilities Finance Agency, 2/05 at 102.00 AAA 4,276,480
FHA-Insured Mortgage Revenue Bonds, New York and
Presbyterian Hospital, Series 1994A, 6.750%, 8/15/14
(Pre-refunded to 2/15/05) - AMBAC Insured
3,000 New York Tobacco Settlement Financing Corporation, 6/11 at 100.00 AA- 3,338,040
Tobacco Settlement Asset-Backed and State Contingency
Contract-Backed Bonds, Series 2003B-1C, 5.500%, 6/01/16
4,425 Triborough Bridge and Tunnel Authority, New York, No Opt. Call AA- 5,160,037
Convention Center Bonds, Series 1990E, 7.250%, 1/01/10
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 2.8%
1,500 Charlotte-Mecklenburg Hospital Authority, North 1/11 at 101.00 AA 1,528,470
Carolina, Healthcare System Revenue Bonds, Carolinas
Healthcare System, Series 2001A, 5.000%, 1/15/31
5,500 North Carolina Eastern Municipal Power Agency, 7/04 at 101.00 BBB 5,547,465
Power System Revenue Bonds, Series 1993D,
5.600%, 1/01/16
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 1.2%
2,800 Cuyahoga County, Ohio, Hospital Revenue Bonds, 8/05 at 102.00 AAA 3,047,968
Meridia Health System, Series 1995, 6.250%, 8/15/14
(Pre-refunded to 8/15/05)
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 2.2%
1,000 Dauphin County General Authority, Pennsylvania, 2/09 at 101.00 AAA 1,061,070
Health System Revenue Bonds, Pinnacle Health System
Project, Series 1999, 5.125%, 8/15/17 - MBIA Insured
1,000 Philadelphia Authority for Industrial Development, 7/11 at 101.00 AAA 1,086,680
Pennsylvania, Airport Revenue Bonds, Philadelphia
Airport System Project, Series 2001A, 5.500%, 7/01/17
(Alternative Minimum Tax) - FGIC Insured
3,250 Philadelphia School District, Pennsylvania, General 2/12 at 100.00 AAA 3,510,195
Obligation Bonds, Series 2002A, 5.500%, 2/01/31 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 1.2%
3,000 Puerto Rico Housing Finance Authority, Capital Fund 12/13 at 100.00 AA*** 3,202,410
Program Revenue Bonds, Series 2003, 5.000%, 12/01/20
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 1.8%
5,000 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 4,585,550
Tobacco Settlement Asset-Backed Bonds, Series 2002A,
6.250%, 6/01/42
20
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 6.4%
$ 4,000 Greenville County School District, South Carolina, 12/12 at 101.00 AA- $ 4,493,120
Installment Purchase Revenue Bonds, Series 2002,
5.875%, 12/01/19
2,500 Lexington County Health Service District, South 11/13 at 100.00 A 2,798,500
Carolina, Hospital Revenue Refunding and Improvement
Bonds, Series 2003, 6.000%, 11/01/18
8,350 South Carolina Public Service Authority, Revenue Refunding 1/06 at 102.00 AAA 9,022,593
Bonds, Santee Cooper Electric System, Series 1996A,
5.750%, 1/01/22 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 15.7%
3,275 Bexar County Health Facilities Development Corporation, 8/04 at 102.00 AAA 3,411,600
Texas, Hospital Revenue Bonds, Baptist Memorial Hospital
System Project, Series 1994, 6.900%, 2/15/14
(Pre-refunded to 8/15/04) - MBIA Insured
4,000 Brazos River Harbor Navigation District, Brazoria 5/12 at 101.00 A- 4,534,520
County, Texas, Environmental Facilities Revenue Bonds,
Dow Chemical Company Project, Series 2002A-6,
6.250%, 5/15/33 (Alternative Minimum Tax)
(Mandatory put 5/15/17)
4,540 Cleveland Housing Corporation, Texas, FHA-Insured 7/04 at 100.00 AAA 4,547,400
Section 8 Assisted Mortgage Revenue Refunding
Bonds, Series 1992C, 7.375%, 7/01/24 - MBIA Insured
4,550 Harris County-Houston Sports Authority, Texas, Junior 11/31 at 53.78 AAA 560,515
Lien Revenue Bonds, Series 2001H, 0.000%, 11/15/41 -
MBIA Insured
2,500 Harris County Health Facilities Development Corporation, 10/05 at 102.00 AAA 2,864,750
Texas, Hospital Revenue Bonds, Texas Children's Hospital,
Series 1995, 5.500%, 10/01/16 - MBIA Insured
3,000 Harris County Health Facilities Development Corporation, 11/13 at 100.00 AAA 3,091,110
Texas, Thermal Utility Revenue Bonds, TECO Project,
Series 2003, 5.000%, 11/15/30 - MBIA Insured
2,000 Houston, Texas, Airport System, Subordinate Lien 7/12 at 100.00 AAA 2,173,300
Revenue Bonds, Series 2002A, 5.625%, 7/01/20
(Alternative Minimum Tax) - FSA Insured
3,125 Katy Independent School District, Harris, Fort Bend 2/12 at 100.00 AAA 3,226,188
and Waller Counties, Texas, General Obligation
Bonds, Series 2002A, 5.000%, 2/15/32
4,750 Sam Rayburn Municipal Power Agency, Texas, Power 10/12 at 100.00 AA 5,171,658
Supply System Revenue Refunding Bonds, Series 2002A,
5.500%, 10/01/17 - RAAI Insured
8,900 Texas Turnpike Authority, Dallas North Tollway System 1/06 at 102.00 AAA 9,439,340
Revenue Bonds, President George Bush Turnpike,
Series 1995, 5.250%, 1/01/23 - FGIC Insured
1,250 Texas Water Development Board, Senior Lien State 1/07 at 100.00 AAA 1,344,263
Revolving Fund Revenue Bonds, Series 1996B,
5.125%, 7/15/18
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.6%
1,435 Salt Lake City and Sandy Metropolitan Water District, 7/14 at 100.00 Aaa 1,531,576
Utah, Water Revenue Bonds, Series 2004,
5.000%, 7/01/21
------------------------------------------------------------------------------------------------------------------------------------
VERMONT - 2.7%
3,000 Vermont Housing Finance Agency, Multifamily Housing 2/09 at 100.00 AAA 3,187,740
Bonds, Series 1999C, 5.800%, 8/15/16 - FSA Insured
3,600 Vermont Industrial Development Authority, Industrial 9/04 at 100.00 A 3,636,936
Development Revenue Refunding Bonds, Stanley
Works, Inc. Project, Series 1992, 6.750%, 9/01/10
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 3.6%
2,000 Washington State Healthcare Facilities Authority, 12/07 at 101.00 AAA 2,123,680
Revenue Bonds, Catholic Health Initiatives,
Series 1997A, 5.125%, 12/01/17 - MBIA Insured
6,715 Washington State Healthcare Facilities Authority, 10/11 at 100.00 AAA 7,180,148
Revenue Bonds, Sisters of Providence Health System,
Series 2001A, 5.125%, 10/01/17 - MBIA Insured
21
Nuveen Select Tax-Free Income Portfolio 2 (NXQ) (continued)
Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 2.1%
$ 4,000 Wisconsin Housing and Economic Development Authority, 3/12 at 100.00 AA $ 4,208,960
Home Ownership Revenue Bonds, Series 2002G,
4.850%, 9/01/17
1,000 Wisconsin Health and Educational Facilities Authority, 8/13 at 100.00 A 1,082,480
Revenue Bonds, Wheaton Franciscan Services, Inc.,
Series 2003A, 5.500%, 8/15/18
------------------------------------------------------------------------------------------------------------------------------------
$ 252,010 Total Long-Term Investments (cost $240,927,177) - 98.0% 251,365,847
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 2.0% 5,006,774
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 256,372,621
====================================================================================================================
* 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. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# On December 9, 2002, UALCorporation, the holding
company of United Air Lines, Inc. filed for federal
bankruptcy protection. The Adviser determined that it
was likely United would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
See accompanying notes to financial statements.
22
Nuveen Select Tax-Free Income Portfolio 3 (NXR)
Portfolio of
INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ALABAMA - 0.3%
$ 500 Marshall County Healthcare Authority, Alabama, Revenue 1/12 at 101.00 A- $ 550,050
Bonds, Series 2002A, 6.250%, 1/01/22
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 6.6%
2,105 Azusa Unified School District, Los Angeles County, 7/12 at 100.00 AAA 2,311,985
California, General Obligation Bonds, Series 2002,
5.375%, 7/01/21 - FSA Insured
3,350 California Department of Water Resources, Power 5/12 at 101.00 A3 3,879,334
Supply Revenue Bonds, Series 2002A, 6.000%, 5/01/14
3,000 California State Public Works Board, Lease Revenue 11/04 at 102.00 Aaa 3,162,210
Bonds, Department of Corrections, Soledad II State
Prison, Series 1994A, 6.875%, 11/01/14
(Pre-refunded to 11/01/04)
3,000 Golden State Tobacco Securitization Corporation, 6/13 at 100.00 BBB 2,969,760
California, Tobacco Settlement Asset-Backed Bonds,
Series 2003A-1, 6.750%, 6/01/39
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 5.7%
4,000 Colorado Health Facilities Authority, Revenue Bonds, 9/12 at 100.00 AA 4,232,360
Catholic Health Initiatives, Series 2002A,
5.500%, 3/01/22
2,700 Denver City and County, Colorado, Airport System No Opt. Call A 3,330,639
Revenue Bonds, Series 1991D, 7.750%, 11/15/13
(Alternative Minimum Tax)
3,000 Denver Convention Center Hotel Authority, Colorado, 12/13 at 100.00 AAA 3,136,710
Convention Center Hotel Senior Revenue Bonds,
Series 2003A, 5.000%, 12/01/24 - XLCA Insured
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 0.1%
250 Connecticut Health and Educational Facilities Authority, 7/04 at 100.00 AAA 253,163
Revenue Bonds, Bridgeport Hospital Issue, Series 1992A,
6.625%, 7/01/18 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.9%
235 District of Columbia, General Obligation Refunding No Opt. Call AAA 282,519
Bonds, Series 1994A-1, 6.500%, 6/01/10 - MBIA Insured
1,305 District of Columbia, General Obligation Bonds, 6/04 at 101.00 AAA 1,328,412
Series 1993E, 6.000%, 6/01/13 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 5.0%
4,000 JEA, Florida, Subordinate Lien Electric System Revenue 10/07 at 100.00 AA- 4,011,520
Bonds, Series 2002D, 4.625%, 10/01/22
5,020 JEA, St. John's River Power Park System, Florida, 10/11 at 100.00 AA 5,330,838
Revenue Refunding Bonds, Series 2002-17, Issue 2,
5.000%, 10/01/18
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 21.7%
3,000 Bryant, Illinois, Pollution Control Revenue Refunding 8/04 at 100.00 A2 3,002,610
Bonds, Central Illinois Light Company Project,
Series 1992, 6.500%, 2/01/18
2,435 Chicago Metropolitan Housing Development Corporation, 7/04 at 100.00 AA 2,519,008
Illinois, FHA-Insured Section 8 Housing Development
Revenue Refunding Bonds, Series 1992, 6.850%, 7/01/22
2,550 Chicago, Illinois, FHA-Insured Mortgage Revenue 6/04 at 100.00 AAA 2,557,676
Bonds, Lakeview Towers Project, Series 1992,
6.600%, 12/01/20
700 Chicago, Illinois, Special Facility Revenue Refunding No Opt. Call N/R 217,000
Bonds, O'Hare International Airport, United
Air Lines, Inc. Project, Series 2001C, 6.300%, 5/01/16#
1,930 Illinois Development Finance Authority, Revenue Bonds, 5/11 at 101.00 BBB+ 2,080,386
Midwestern University, Series 2001B, 5.750%, 5/15/16
1,500 Illinois Health Facilities Authority, Revenue Bonds, No Opt. Call N/R*** 1,814,595
Evangelical Hospitals Corporation, Series 1992C,
6.250%, 4/15/22
4,000 Illinois Health Facilities Authority, Revenue Bonds, 9/06 at 100.00 AAA 4,473,640
Franciscan Sisters Healthcare Corporation Project,
Series 1992B, 6.625%, 9/01/13 (Pre-refunded
to 9/01/06) - MBIA Insured
23
Nuveen Select Tax-Free Income Portfolio 3 (NXR) (continued)
Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 4,470 Illinois Health Facilities Authority, Remarketed Revenue 8/11 at 103.00 Aa1 $ 4,954,682
Bonds, University of Chicago Project, Series 1985A,
5.500%, 8/01/20
2,225 Illinois Health Facilities Authority, Revenue Refunding 1/13 at 100.00 A2 2,518,500
Bonds, Elmhurst Memorial Healthcare, Series 2002,
6.250%, 1/01/17
620 Illinois Housing Development Authority, Homeowner 2/10 at 100.00 AA 671,063
Mortgage Revenue Bonds, Series 2000D-3,
5.700%, 8/01/17
5,700 Illinois, Sales Tax Revenue Bonds, First 6/13 at 100.00 AAA 6,015,837
Series 2002, 5.000%, 6/15/22
2,000 Illinois, Sales Tax Revenue Bonds, Series 1997X, 6/07 at 101.00 AAA 2,212,280
5.600%, 6/15/17
6,000 Metropolitan Pier and Exposition Authority, Illinois, 6/12 at 101.00 AAA 6,351,240
Refunding Bonds, McCormick Place Expansion Project,
Series 2002B, 5.000%, 6/15/21 - MBIA Insured
1,000 Yorkville United City, Illinois, General Obligation Debt 12/11 at 100.00 AA 1,020,110
Certificates, Series 2003, 5.000%, 12/15/22 -
RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 4.6%
3,500 Indiana Health Facility Financing Authority, Hospital 9/11 at 100.00 A+ 3,612,630
Revenue Bonds, Methodist Hospital, Inc., Series 2001,
5.375%, 9/15/22
2,000 Indianapolis Local Public Improvement Bond Bank, 7/12 at 100.00 AAA 2,111,460
Indiana, Waterworks Project, Series 2002A,
5.250%, 7/01/33 - MBIA Insured
2,725 Warrick County, Indiana, Adjustable Rate Environmental 5/04 at 101.00 A- 2,768,055
Improvement Revenue Bonds, Southern Indiana Gas
and Electric Company Project, Series 1993B,
6.000%, 5/01/23 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 2.9%
Iowa Tobacco Settlement Authority, Tobacco Settlement
Asset-Backed Revenue Bonds, Series 2001B:
3,500 5.300%, 6/01/25 6/11 at 101.00 BBB 3,036,635
2,850 5.600%, 6/01/35 6/11 at 101.00 BBB 2,420,619
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 0.3%
500 Massachusetts Health and Educational Facilities 7/11 at 101.00 AA- 563,925
Authority, Revenue Bonds, Partners HealthCare
System, Inc., Series 2001C, 6.000%, 7/01/17
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 9.4%
4,000 Michigan Housing Development Authority, Single 6/06 at 102.00 AA+ 4,212,680
Family Mortgage Revenue Bonds, Series 1996C,
5.950%, 12/01/17
235 Michigan State Hospital Finance Authority, Revenue 8/04 at 101.00 Ba3 196,389
Refunding Bonds, Detroit Medical Center Obligated
Group, Series 1993A, 6.500%, 8/15/18
2,900 Michigan State Hospital Finance Authority, Revenue 12/12 at 100.00 AA- 3,030,500
Refunding Bonds, Trinity Health Credit Group,
Series 2002C, 5.375%, 12/01/30
8,240 Michigan Housing Development Authority, Limited 9/04 at 101.00 AAA 8,396,890
Obligation Multifamily Housing Revenue Bonds,
Greenwood Villa Project, Series 1992, 6.625%, 9/15/17 -
FSA Insured
1,600 Plymouth-Canton Community School District, Wayne 5/09 at 100.00 AA+ 1,652,944
and Washtenaw Counties, Michigan, Unlimited Tax
General Obligation School Building and Site Bonds,
Series 1999, 4.750%, 5/01/18
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 2.0%
3,500 Nebraska Public Power District, General Revenue 1/13 at 100.00 AAA 3,639,300
Bonds, Series 2002B, 5.000%, 1/01/33 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 4.9%
4,000 State Department of Business and Industry, Director 1/10 at 100.00 AAA 4,245,600
of Nevada, Revenue Bonds, Las Vegas Monorail
Project, First Tier, Series 2000, 5.375%, 1/01/40 -
AMBAC Insured
4,510 Reno, Nevada, Capital Improvement Revenue Bonds, 6/12 at 100.00 AAA 4,953,694
Series 2002, 5.500%, 6/01/22 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.7%
1,205 New Hampshire Housing Finance Agency, Single Family 5/11 at 100.00 Aa2 1,281,023
Mortgage Acquisition Bonds, Series 2001A,
5.600%, 7/01/21 (Alternative Minimum Tax)
24
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 3.5%
$ 2,335 Long Island Power Authority, New York, Electric System 9/11 at 100.00 A- $ 2,461,791
General Revenue Bonds, Series 2001A, 5.375%, 9/01/21
35 New York City, New York, General Obligation Bonds, 4/04 at 100.00 A 35,143
Series 1991B, 7.000%, 2/01/18
2,130 Dormitory Authority of the State of New York, Second No Opt. Call A3 2,518,192
General Resolution Consolidated Revenue Bonds,
City University System, Series 1990C, 7.500%, 7/01/10
1,475 New York State Medical Care Facilities Finance Agency, 8/04 at 100.00 AAA 1,503,571
FHA-Insured Mortgage Program Revenue Bonds,
Mount Sinai NYU Health Obligated Group, Series 1992C,
6.250%, 8/15/12 (Pre-refunded to 8/15/04)
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 4.3%
5,000 North Carolina Municipal Power Agency 1, Catawba 1/13 at 100.00 AAA 5,494,100
Electric Revenue Bonds, Series 2003A, 5.250%, 1/01/18 -
MBIA Insured
2,345 Piedmont Triad Airport Authority, North Carolina, Airport 7/11 at 101.00 AAA 2,574,083
Revenue Bonds, Series 2001A, 5.250%, 7/01/16 -
FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 2.5%
2,435 Dauphin County Industrial Development Authority, No Opt. Call A- 3,039,221
Pennsylvania, Water Development Revenue Refunding
Bonds, Dauphin Consolidated Water Supply Company,
Series 1992B, 6.700%, 6/01/17
500 Pennsylvania Higher Educational Facilities Authority, 7/13 at 100.00 BBB+ 510,835
Revenue Bonds, Widner University, Series 2003,
5.250%, 7/15/24
1,000 Philadelphia Authority for Industrial Development, 7/11 at 101.00 AAA 1,086,680
Pennsylvania, Airport Revenue Bonds, Philadelphia
Airport System Project, Series 2001A, 5.500%, 7/01/17
(Alternative Minimum Tax) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 2.3%
1,500 Lexington County Health Service District, 11/13 at 100.00 A 1,679,100
South Carolina, Hospital Revenue Refunding and
Improvement Bonds, Series 2003, 6.000%, 11/01/18
2,500 South Carolina JOBS Economic Development Authority, 11/12 at 100.00 A- 2,561,575
Revenue Bonds, Bon Secours Health System, Inc.,
Series 2002A, 5.625%, 11/15/30
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 1.1%
2,000 Knox County Health, Educational and Housing Facilities 4/12 at 101.00 Baa2 2,093,560
Board, Tennessee, Hospital Facilities Revenue Bonds,
Baptist Health System of East Tennessee, Inc.,
Series 2002, 6.375%, 4/15/22
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 13.9%
3,755 Grand Prairie Industrial Development Authority, 6/04 at 101.00 A- 3,807,044
Texas, Industrial Development Revenue Refunding
Bonds, Baxter International, Inc. Project, Series 1992,
6.550%, 12/01/12
2,500 Harris County Health Facilities Development 10/04 at 101.00 AAA 2,591,675
Corporation, Texas, Hospital Revenue Bonds, Memorial
Hermann Healthcare System, Series 1994, 6.375%, 10/01/17
(Pre-refunded to 10/01/04) - MBIA Insured
2,500 Harris County Health Facilities Development Corporation, 11/13 at 100.00 AAA 2,575,925
Texas, Thermal Utility Revenue Bonds, TECO Project,
Series 2003, 5.000%, 11/15/30 - MBIA Insured
3,000 Houston, Texas, Airport System, Subordinate Lien 7/12 at 100.00 AAA 3,357,660
Revenue Bonds, Series 2002B, 5.500%, 7/01/18
3,125 Katy Independent School District, Harris, Fort Bend 2/12 at 100.00 AAA 3,226,188
and Waller Counties, Texas, General Obligation Bonds,
Series 2002A, 5.000%, 2/15/32
5,000 North Central Texas Health Facilities Development 5/06 at 102.00 AA- 5,182,200
Corporation, Hospital Revenue Refunding Bonds,
Baylor Healthcare System, Series 1995, 5.250%, 5/15/16
4,750 Sam Rayburn Municipal Power Agency, Texas, 10/12 at 100.00 AA 5,171,658
Power Supply System Revenue Refunding Bonds,
Series 2002A, 5.500%, 10/01/17 - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.9%
1,710 Intermountain Power Agency, Utah, Power Supply 7/06 at 102.00 A+ 1,753,588
Revenue Refunding Bonds, Series 1996D,
5.000%, 7/01/21
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 2.1%
3,880 Washington, General Obligation Bonds, No Opt. Call Aa1 3,880,850
Series 1993A, 4.500%, 10/01/18
25
Nuveen Select Tax-Free Income Portfolio 3 (NXR) (continued)
Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 1.4%
$ 2,500 Berkeley County Building Commission, West Virginia, 5/04 at 101.00 BBB- $ 2,521,500
Hospital Revenue Bonds, City Hospital Project,
Series 1992, 6.500%, 11/01/09
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.4%
2,500 Wisconsin, General Obligation Refunding Bonds, 11/13 at 100.00 AA- 2,605,250
Series 2003-3, 5.000%, 11/01/26
------------------------------------------------------------------------------------------------------------------------------------
$ 174,335 Total Long-Term Investments (cost $175,565,783) - 98.5% 183,541,860
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.5% 2,816,184
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 186,358,044
====================================================================================================================
* 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. Such securities are normally
considered to be equivalent to AAA rated securities.
N/R Investment is not rated.
# On December 9, 2002, UALCorporation, the holding
company of United Air Lines, Inc. filed for federal
bankruptcy protection. The Adviser determined that it
was likely United would not remain current on their
interest payment obligations with respect to these
bonds and thus has stopped accruing interest.
See accompanying notes to financial statements.
26
Nuveen California Select Tax-Free Income Portfolio (NXC)
Portfolio of
INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 2.1%
$ 2,000 California County Tobacco Securitization Agency, 6/12 at 100.00 BBB $ 1,914,860
Tobacco Settlement Asset-Backed Revenue Bonds,
Fresno County Tobacco Funding Corporation, Series 2002,
5.625%, 6/01/23
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 14.0%
1,000 California Educational Facilities Authority, Revenue 12/09 at 101.00 AAA 1,045,500
Bonds, Stanford University, Series 1999P,
5.000%, 12/01/23
750 California Educational Facilities Authority, Revenue 8/09 at 100.00 A1 790,943
Bonds, Pepperdine University, Series 2002A,
5.500%, 8/01/32
2,600 California Educational Facilities Authority, Revenue 11/11 at 100.00 A2 2,762,630
Bonds, University of the Pacific, Series 2002,
5.250%, 11/01/21
1,000 California Educational Facilities Authority, Revenue 10/12 at 100.00 A2 1,069,110
Bonds, University of San Diego, Series 2002A,
5.500%, 10/01/32
3,000 California Infrastructure Economic Development Bank, 10/11 at 101.00 A- 3,265,620
Revenue Bonds, J. David Gladstone Institutes Project,
Series 2001, 5.500%, 10/01/19
2,000 California State Public Works Board, Lease Revenue 10/12 at 100.00 AAA 2,099,520
Bonds, University of California System, Series 2002A,
5.000%, 10/01/22
750 California Statewide Community Development 8/12 at 100.00 A 790,658
Authority, Student Housing Revenue Bonds, EAH - Irvine
East Campus Apartments, LLC Project, Series 2002A,
5.500%, 8/01/22 - ACA Insured
1,000 Long Beach Bond Financing Authority, California, 11/11 at 101.00 AAA 1,059,080
Lease Revenue Refunding Bonds, Long Beach Aquarium
of the South Pacific, Series 2001, 5.250%, 11/01/30 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 14.6%
2,500 California Health Facilities Financing Authority, Insured 4/04 at 101.00 AAA 2,557,800
Hospital Revenue Bonds, Scripps Memorial
Hospital, Series 1992A, 6.400%, 10/01/12 -
MBIA Insured
2,000 California Infrastructure Economic Development Bank, 8/11 at 102.00 A 2,090,360
Revenue Bonds, Kaiser Hospital Assistance LLC,
Series 2001A, 5.550%, 8/01/31
1,880 California Statewide Community Development 6/07 at 101.00 AAA 2,067,267
Authority, Revenue Bonds, Los Angeles Orthopaedic
Hospital Foundation, Series 2000, 5.500%, 6/01/17 -
AMBAC Insured
1,500 California Statewide Community Development 11/09 at 102.00 BBB 1,535,550
Authority, Insured Mortgage Hospital Revenue Bonds,
Mission Community Hospital, Series 2001,
5.375%, 11/01/26
4,000 California Statewide Community Development 6/13 at 100.00 AAA 4,394,840
Authority, Hospital Revenue Bonds, Monterey
Peninsula Hospital, Series 2003B, 5.250%, 6/01/18 -
FSA Insured
790 Central California Joint Powers Health Financing 8/04 at 100.00 Baa2 777,170
Authority, Certificates of Participation, Community
Hospitals of Central California, Series 1993,
5.000%, 2/01/23
------------------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 1.7%
1,500 ABAG Finance Authority for Non-Profit Corporations, 11/12 at 100.00 BBB 1,532,625
California, Insured Senior Living Revenue Bonds, Odd
Fellows Home of California, Series 2003A,
5.200%, 11/15/22
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 21.4%
2,000 Antelope Valley Union High School District, Los Angeles 8/12 at 101.00 AAA 2,088,580
County, California, General Obligation Bonds,
Series 2002A, 5.000%, 2/01/27 - MBIA Insured
1,500 Beverly Hills Unified School District, Los Angeles 8/12 at 100.00 AA 1,560,540
County, California, General Obligation Bonds,
Series 2002A, 5.000%, 8/01/26
California, General Obligation Bonds, Series 2003:
500 5.250%, 11/01/19 - RAAI Insured 11/13 at 100.00 AA 531,915
1,450 5.250%, 2/01/21 8/13 at 100.00 Baa1 1,516,845
27
Nuveen California Select Tax-Free Income Portfolio (NXC) (continued)
Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL (continued)
$ 750 California, General Obligation Bonds, Series 2004, 2/14 at 100.00 Baa1 $ 760,718
5.000%, 2/01/23
2,000 Fremont Unified School District, Alameda County, 8/12 at 101.00 AAA 2,140,720
California, General Obligation Bonds, Series 2002A,
5.000%, 8/01/21 - FGIC Insured
Golden West Schools Financing Authority, California, Revenue
Bonds, School District General Obligation Refunding Program,
Series 1999A:
4,650 0.000%, 8/01/16 - MBIA Insured No Opt. Call AAA 2,687,514
1,750 0.000%, 2/01/17 - MBIA Insured No Opt. Call AAA 976,868
2,375 0.000%, 8/01/17 - MBIA Insured No Opt. Call AAA 1,295,966
2,345 0.000%, 2/01/18 - MBIA Insured No Opt. Call AAA 1,232,391
Mountain View-Los Altos Union High School District, Santa Clara
County, California, General Obligation Capital Appreciation
Bonds, Series 1995C:
1,015 0.000%, 5/01/17 - MBIA Insured No Opt. Call AAA 561,620
1,080 0.000%, 5/01/18 - MBIA Insured No Opt. Call AAA 562,572
2,000 North Orange County Community College District, 8/12 at 101.00 AAA 2,124,760
California, General Obligation Bonds, Series 2002A,
5.000%, 8/01/22 - MBIA Insured
1,500 San Diego Unified School District, San Diego County, 7/13 at 101.00 AAA 1,632,825
California, General Obligation Bonds, Series 2003E,
5.250%, 7/01/24 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 9.4%
1,000 Bell Community Redevelopment Agency, California, 10/13 at 100.00 AA 1,070,620
Tax Allocation Bonds, Bell Project Area, Series 2003,
5.625%, 10/01/33 - RAAI Insured
3,500 California State Public Works Board, Lease Revenue No Opt. Call AAA 4,370,415
Bonds, Department of Corrections, Calipatria State
Prison, Series 1991A, 6.500%, 9/01/17 - MBIA Insured
1,400 Golden State Tobacco Securitization Corporation, 6/13 at 100.00 Baa2 1,425,606
California, Enhanced Tobacco Settlement Asset-Backed
Bonds, Series 2003B, 5.500%, 6/01/33
605 Sacramento City Financing Authority, California, Lease No Opt. Call AAA 695,938
Revenue Refunding Bonds, Series 1993A,
5.400%, 11/01/20 - MBIA Insured
1,000 Santa Clara County Board of Education, California, 4/12 at 101.00 AAA 1,043,820
Certificates of Participation, Series 2002,
5.000%, 4/01/25 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 15.1%
1,150 Foothill-Eastern Transportation Corridor Agency, 1/10 at 100.00 BBB- 1,072,318
California, Toll Road Revenue Bonds, Series 1995A,
5.000%, 1/01/35
5,000 Los Angeles Harbors Department, California, Revenue 8/11 at 100.00 AAA 5,414,500
Refunding Bonds, Series 2001B, 5.500%, 8/01/17
(Alternative Minimum Tax) - AMBAC Insured
3,675 Palm Springs Financing Authority, California, 7/04 at 100.00 AAA 3,687,458
Palm Springs Regional Airport Revenue Bonds,
Series 1992, 6.000%, 1/01/12 (Alternative Minimum
Tax) - MBIA Insured
1,000 Port of Oakland, California, Revenue Bonds, 11/12 at 100.00 AAA 1,088,130
Series 2002M, 5.250%, 11/01/20 - FGIC Insured
2,500 Port of Oakland, California, Revenue Bonds, 11/12 at 100.00 AAA 2,585,400
Series 2002N, 5.000%, 11/01/22 (Alternative
Minimum Tax) - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 9.4%
California Department of Water Resources, Power
Supply Revenue Bonds, Series 2002A:
2,000 5.750%, 5/01/17 5/12 at 101.00 A3 2,238,700
2,000 5.125%, 5/01/19 5/12 at 101.00 A3 2,105,240
200 Los Angeles Department of Water and Power, California, 7/13 at 100.00 AAA 213,016
Power System Revenue Bonds, Series 2003A-2,
5.000%, 7/01/21 - MBIA Insured
2,550 M-S-R Public Power Agency, California, San Juan 7/04 at 100.00 AAA 2,627,520
Project Revenue Bonds, Series 1991E, 6.000%, 7/01/22 -
MBIA Insured
1,225 Turlock Irrigation District, California, Revenue Refunding No Opt. Call AAA 1,458,828
Bonds, Series 1992A, 6.250%, 1/01/12 - MBIA Insured
28
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 11.0%
$ 2,160 California Statewide Communities Development 10/11 at 101.00 AAA $ 2,311,956
Authority, Water and Wastewater Revenue Bonds,
Pooled Financing Program, Cities of Calistoga, Pacific
Grove, Pacifica and the United Water Conservation
District, Series 2001B, 5.125%, 10/01/22 - FSA Insured
3,000 Contra Costa Water District, Contra Costa County, 10/04 at 102.00 AAA 3,048,930
California, Water Revenue Bonds, Series 2001G,
5.000%, 10/01/24 - MBIA Insured
2,800 Los Angeles, California, Wastewater System Revenue 6/08 at 101.00 AAA 2,901,136
Bonds, Series 1998A, 5.000%, 6/01/23 - FGIC Insured
825 South Feather Water and Power Agency, California, 4/13 at 100.00 BBB 810,131
Water Revenue Certificates of Participation, Solar
Photovoltaic Project, Series 2003, 5.375%, 4/01/24
1,000 Woodbridge Irrigation District, California, Certificates 7/13 at 100.00 BBB+ 1,033,770
of Participation, Water Systems Project, Series 2003,
5.625%, 7/01/43
------------------------------------------------------------------------------------------------------------------------------------
$ 91,775 Total Long-Term Investments (cost $86,129,077) - 98.7% 90,630,799
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.3% 1,233,298
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 91,864,097
====================================================================================================================
* 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.
29
Nuveen New York Select Tax-Free Income Portfolio (NXN)
Portfolio of
INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 2.1%
$ 1,235 TSASC, Inc., New York, Tobacco Asset-Backed Bonds, 7/12 at 100.00 BBB $ 1,207,435
Series 2002-1, 5.500%, 7/15/24
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 13.0%
1,700 Amherst Industrial Development Agency, New York, 8/12 at 101.00 AAA 1,802,000
Revenue Bonds, UBF Faculty/Student Housing Corporation,
University of Buffalo Creekside Project, Series 2002A,
5.000%, 8/01/22 - AMBAC Insured
1,000 New York City Industrial Development Agency, 11/04 at 102.00 AAA 1,049,960
New York, Civic Facility Revenue Bonds, USTA National
Tennis Center Incorporated Project, Series 1994,
6.375%, 11/15/14 - FSA Insured
570 Dormitory Authority of the State of New York, Second No Opt. Call AAA 680,039
General Resolution Consolidated Revenue Bonds, City
University System, Series 1990C, 7.500%, 7/01/10 -
FGIC Insured
1,425 Dormitory Authority of the State of New York, Insured 7/07 at 101.00 AAA 1,530,208
Revenue Bonds, Rochester Institute of Technology,
Series 1997, 5.250%, 7/01/22 - MBIA Insured
1,430 Dormitory Authority of the State of New York, Revenue 7/11 at 101.00 AA- 1,481,866
Bonds, Upstate Community Colleges, Series 2002A,
5.000%, 7/01/23
785 Dormitory Authority of the State of New York, Insured 7/12 at 100.00 AAA 824,721
Revenue Bonds, Iona College, Series 2002,
5.000%, 7/01/22 - XLCA Insured
------------------------------------------------------------------------------------------------------------------------------------
HEALTHCARE - 10.0%
750 New York City Health and Hospitals Corporation, 2/13 at 100.00 AAA 812,123
New York, Health System Revenue Bonds, Series 2003A,
5.250%, 2/15/21 - AMBAC Insured
250 New York City Industrial Development Agency, New York, 7/12 at 101.00 Baa3 259,383
Civic Facility Revenue Bonds, Staten Island University
Hospital Project, Series 2002C, 6.450%, 7/01/32
500 Dormitory Authority of the State of New York, Revenue 7/13 at 100.00 Baa1 521,680
Bonds, Winthrop-South Nassau University Hospital
Association, Series 2003A, 5.500%, 7/01/32
670 Dormitory Authority of the State of New York, Revenue 7/13 at 100.00 AAA 710,428
Bonds, Memorial Sloan Kettering Cancer Center,
Series 2003-1, 5.000%, 7/01/21 - MBIA Insured
250 Dormitory Authority of the State of New York, Revenue 5/13 at 100.00 A3 261,690
Bonds, North Shore Long Island Jewish Group,
Series 2003, 5.375%, 5/01/23
1,680 Dormitory Authority of the State of New York, Revenue 7/11 at 101.00 AAA 1,837,416
Bonds, Winthrop-South Nassau University Health
System Obligated Group, Series 2001A, 5.250%, 7/01/17 -
AMBAC Insured
1,195 Dormitory Authority of the State of New York, Revenue 7/11 at 101.00 AAA 1,306,972
Bonds, Winthrop-South Nassau University Health System
Obligated Group, Series 2001B, 5.250%, 7/01/17 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 8.2%
1,000 East Rochester Housing Authority, New York, Revenue 12/12 at 103.00 AAA 1,072,820
Bonds, GNMA/FHA Secured Revenue Bonds, St. Mary's
Residence Project, Series 2002A, 5.375%, 12/20/22
1,285 New Hartford Housing Development Corporation, 7/04 at 100.00 AAA 1,287,352
New York, FHA-Insured Section 8 Mortgage Revenue
Refunding Bonds, Village Point Apartments Project,
Series 1992A, 7.375%, 1/01/24 - MBIA Insured
1,000 New Hartford-Sunset Woods Funding Corporation, 8/12 at 101.00 AAA 1,074,380
New York, FHA-Insured Mortgage Revenue Bonds,
Sunset Woods Apartments II Project, Series 2002,
5.350%, 2/01/20
1,225 New York State Housing Finance Agency, FHA-Insured 8/04 at 100.00 AAA 1,234,923
Mortgage Multifamily Housing Revenue Bonds,
Series 1992C, 6.450%, 8/15/14 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 8.2%
2,500 New York State Mortgage Agency, Mortgage Revenue 4/11 at 100.00 Aaa 2,578,675
Bonds, Thirty First Series A, 5.300%, 10/01/31
(Alternative Minimum Tax)
2,000 New York State Mortgage Agency, Homeowner 10/11 at 100.00 Aa1 2,117,860
Mortgage Revenue Bonds, Series 101, 5.000%, 10/01/18
(Alternative Minimum Tax)
30
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 9.2%
$ 2,000 East Rochester Housing Authority, New York, 8/12 at 101.00 AAA $ 2,095,900
FHA-Insured Mortgage Revenue Refunding Bonds,
Jewish Home of Rochester, Series 2002, 4.625%, 2/15/17
1,000 New York City Industrial Development Agency, 11/12 at 101.00 AA+ 1,021,940
New York, GNMA Collateralized Mortgage Revenue
Bonds, Eger Harbor House, Inc. Project, Series 2002A,
4.950%, 11/20/32
2,000 Dormitory Authority of the State of New York, 8/11 at 101.00 AAA 2,103,100
FHA-Insured Mortgage Nursing Home Revenue Bonds,
Norwegian Christian Home and Health Center,
Series 2001, 5.200%, 8/01/36 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 6.5%
Clarkstown, Rickland County, New York, Various Purpose
Serial Bonds, Series 1992:
505 5.600%, 6/15/10 - AMBAC Insured No Opt. Call AAA 585,790
525 5.600%, 6/15/11 - AMBAC Insured No Opt. Call AAA 611,987
525 5.600%, 6/15/12 - AMBAC Insured No Opt. Call AAA 617,426
750 New York City, New York, General Obligation Bonds, 8/14 at 100.00 AAA 817,905
Fiscal Series 2004I, 5.000%, 8/01/17 (WI, settling
4/01/04) - MBIA Insured
1,000 West Islip Union Free School District, Suffolk County, 10/10 at 100.00 Aaa 1,077,670
New York, General Obligation Bonds, Series 2001,
5.000%, 10/01/17 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 12.9%
600 Battery Park City Authority, New York, Senior Revenue 11/13 at 100.00 AAA 634,374
Bonds, Series 2003A, 5.000%, 11/01/23
Metropolitan Transportation Authority, New York,
State Service Contract Refunding Bonds, Series 2002A:
500 5.500%, 1/01/20 - MBIA Insured 7/12 at 100.00 AAA 556,685
500 5.000%, 7/01/30 - AMBAC Insured 7/12 at 100.00 AAA 520,360
1,000 Nassau County Interim Finance Authority, New York, 11/06 at 101.00 AAA 1,058,410
Sales Tax Secured Revenue Bonds, Series 2001A-2,
5.125%, 11/15/21 - AMBAC Insured
670 New York City Transitional Finance Authority, New York, 2/13 at 100.00 AA+ 704,378
Future Tax Secured Bonds, Fiscal Series 2003E,
5.000%, 2/01/23
50 New York State Thruway Authority, Highway and Bridge 4/05 at 102.00 AAA 52,534
Trust Fund Bonds, Series 1995A, 5.125%, 4/01/15 -
MBIA Insured
750 New York State Thruway Authority, Highway and Bridge 4/13 at 100.00 AAA 811,732
Trust Fund Bonds, Second General, Series 2003,
5.250%, 4/01/23 - MBIA Insured
250 New York State Thruway Authority, Highway and Bridge 4/14 at 100.00 AAA 267,143
Trust Fund Bonds, Second General, Series 2004,
5.000%, 4/01/21 - MBIA Insured
1,000 New York State Urban Development Corporation, 3/13 at 100.00 AAA 1,115,540
State Personal Income Tax Revenue Bonds, State
Facilities and Equipment, Series 2002C-1,
5.500%, 3/15/21 - FGIC Insured
1,000 New York Tobacco Settlement Financing Corporation, 6/13 at 100.00 AAA 1,098,710
Tobacco Settlement Asset-Backed and State Contingency
Contract-Backed Bonds, Series 2003A-1, 5.250%, 6/01/20 -
AMBAC Insured
500 New York Tobacco Settlement Financing Corporation, 6/13 at 100.00 AA- 551,605
Tobacco Settlement Asset-Backed and State Contingency
Contract-Backed Bonds, Series 2003B-1C, 5.500%, 6/01/21
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 5.6%
500 Metropolitan Transportation Authority, New York, No Opt. Call AAA 562,185
Transportation Revenue Bonds, Series 2003A,
5.000%, 11/15/15 - FGIC Insured
2,500 Port Authority of New York and New Jersey, 1/05 at 101.00 AAA 2,617,124
Consolidated Bonds, Ninety-Seventh Series,
6.500%, 7/15/19 (Alternative Minimum Tax) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 6.0%
1,420 Dormitory Authority of the State of New York, Judicial No Opt. Call AAA 1,803,570
Facilities Lease Revenue Bonds, Suffolk County Issue,
Series 1986, 7.375%, 7/01/16
1,000 New York State Medical Care Facilities Finance Agency, 8/04 at 100.00 AAA 1,019,370
FHA-Insured Mortgage Program Revenue Bonds,
Mount Sinai NYU Health Obligated Group, Series 1992C,
6.250%, 8/15/12 (Pre-refunded to 8/15/04) -
MBIA Insured
485 Suffolk County Water Authority, New York, Water No Opt. Call AAA 585,480
Revenue Bonds, Series 1986V, 6.750%, 6/01/12
31
Nuveen New York Select Tax-Free Income Portfolio (NXN) (continued)
Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET
AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 5.6%
$ 2,000 Long Island Power Authority, New York, Electric System 6/08 at 101.00 AAA $ 2,108,880
General Revenue Bonds, Series 1998A,
5.125%, 12/01/22 - FSA Insured
1,000 Long Island Power Authority, New York, Electric System 9/13 at 100.00 AAA 1,089,670
General Revenue Bonds, Series 2003C,
5.000%, 9/01/16 - CIFG Insured
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 12.1%
2,500 New York City Municipal Water Finance Authority, 6/11 at 101.00 AA 2,610,400
New York, Water and Sewer System Revenue Bonds,
Fiscal Series 2001C, 5.125%, 6/15/33
New York State Environmental Facilities Corporation, State Clean
Water and Drinking Water Revolving Funds Revenue Bonds, New York
City Municipal Water Finance Authority Loan, Series 2002B:
2,000 5.250%, 6/15/19 6/12 at 100.00 AAA 2,191,600
2,000 5.000%, 6/15/27 6/12 at 100.00 AAA 2,089,480
------------------------------------------------------------------------------------------------------------------------------------
$ 52,980 Total Long-Term Investments (cost $53,512,729) - 99.4% 56,632,879
=============-----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.6% 324,823
--------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 56,957,702
====================================================================================================================
* 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.
See accompanying notes to financial statements.
32
Statement of
ASSETS AND LIABILITIES March 31, 2004
NEW YORK
SELECT SELECT SELECT CALIFORNIA SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 SELECT TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at market value
(cost $223,802,927, $240,927,177, $175,565,783,
$86,129,077 and $53,512,729, respectively) $238,890,176 $251,365,847 $183,541,860 $90,630,799 $56,632,879
Cash -- 1,132,561 -- -- 395,983
Receivables:
Interest 4,225,729 4,017,107 2,979,498 1,376,219 800,095
Investments sold 735,100 -- -- -- --
Other assets 59,908 63,718 44,934 21,714 12,655
------------------------------------------------------------------------------------------------------------------------------------
Total assets 243,910,913 256,579,233 186,566,292 92,028,732 57,841,612
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Cash overdraft 567,586 -- 64,901 92,838 --
Payable for investments purchased -- -- -- -- 834,420
Accrued expenses:
Management fees 50,746 64,222 47,122 23,636 14,629
Other 127,403 142,390 96,225 48,161 34,861
------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 745,735 206,612 208,248 164,635 883,910
------------------------------------------------------------------------------------------------------------------------------------
Net assets $243,165,178 $256,372,621 $186,358,044 $91,864,097 $56,957,702
====================================================================================================================================
Shares outstanding 16,378,096 17,607,068 12,964,124 6,257,070 3,908,223
====================================================================================================================================
Net asset value per share outstanding
(net assets divided by shares outstanding) $ 14.85 $ 14.56 $ 14.37 $ 14.68 $ 14.57
====================================================================================================================================
NET ASSETS CONSIST OF:
------------------------------------------------------------------------------------------------------------------------------------
Common shares, $.01 par value per share $ 163,781 $ 176,071 $ 129,641 $ 62,571 $ 39,082
Paid-in surplus 227,635,042 245,690,697 178,372,582 87,121,715 53,622,239
Undistributed (Over-distribution of)
net investment income (46,057) (373,447) (125,424) (114,580) 2,359
Accumulated net realized gain from investments 325,163 440,630 5,168 292,669 173,872
Net unrealized appreciation of investments 15,087,249 10,438,670 7,976,077 4,501,722 3,120,150
------------------------------------------------------------------------------------------------------------------------------------
Net assets $243,165,178 $256,372,621 $186,358,044 $91,864,097 $56,957,702
====================================================================================================================================
See accompanying notes to financial statements.
33
Statement of
OPERATIONS Year Ended March 31, 2004
NEW YORK
SELECT SELECT SELECT CALIFORNIA SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 SELECT TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $12,714,505 $13,353,220 $ 9,673,322 $4,582,462 $2,881,085
------------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 592,080 747,072 547,905 273,136 170,192
Shareholders' servicing agent fees and expenses 48,127 47,295 36,098 12,963 9,741
Custodian's fees and expenses 55,878 59,960 40,587 23,265 18,930
Trustees' fees and expenses 8,768 7,762 4,718 2,155 1,128
Professional fees 16,675 17,039 13,413 9,665 8,033
Shareholders' reports - printing and mailing expenses 68,054 71,553 38,327 19,061 17,896
Stock exchange listing fees 15,535 15,535 15,535 11,097 11,097
Investor relations expense 7,223 15,004 4,814 3,092 1,677
Other expenses 9,357 9,499 7,740 5,335 4,318
------------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit 821,697 990,719 709,137 359,769 243,012
Custodian fee credit (13,000) (13,590) (8,192) (7,327) (2,432)
------------------------------------------------------------------------------------------------------------------------------------
Net expenses 808,697 977,129 700,945 352,442 240,580
------------------------------------------------------------------------------------------------------------------------------------
Net investment income 11,905,808 12,376,091 8,972,377 4,230,020 2,640,505
------------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN FROM INVESTMENTS
Net realized gain from investments 1,631,548 1,107,932 388,100 528,424 314,601
Change in net unrealized appreciation
(depreciation) of investments 764,039 2,207,042 1,738,203 704,451 294,010
------------------------------------------------------------------------------------------------------------------------------------
Net gain from investments 2,395,587 3,314,974 2,126,303 1,232,875 608,611
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets from operations $14,301,395 $15,691,065 $11,098,680 $5,462,895 $3,249,116
====================================================================================================================================
See accompanying notes to financial statements.
34
Statement of
CHANGES IN NET ASSETS
SELECT TAX-FREE (NXP) SELECT TAX-FREE 2 (NXQ) SELECT TAX-FREE 3 (NXR)
----------------------------- ------------------------------ ---------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
3/31/04 3/31/03 3/31/04 3/31/03 3/31/04 3/31/03
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 11,905,808 $ 12,666,221 $ 12,376,091 $ 13,377,076 $ 8,972,377 $ 9,450,682
Net realized gain
from investments 1,631,548 2,175,032 1,107,932 2,738,597 388,100 2,127,842
Change in net unrealized
appreciation (depreciation)
of investments 764,039 3,681,890 2,207,042 (417,458) 1,738,203 (545,919)
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
from operations 14,301,395 18,523,143 15,691,065 15,698,215 11,098,680 11,032,605
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (12,405,127) (13,364,529) (12,700,072) (14,058,896) (9,009,179) (9,882,044)
From accumulated net
realized gains
from investments (1,399,973) (2,764,623) (973,580) (3,171,385) (868,194) (850,958)
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from
distributions to shareholders (13,805,100) (16,129,152) (13,673,652) (17,230,281) (9,877,373) (10,733,002)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from shares
issued to shareholders due to
reinvestment of distributions -- -- -- -- -- --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease)
in net assets 496,295 2,393,991 2,017,413 (1,532,066) 1,221,307 299,603
Net assets at the
beginning of year 242,668,883 240,274,892 254,355,208 255,887,274 185,136,737 184,837,134
------------------------------------------------------------------------------------------------------------------------------------
Net assets at the end of year $243,165,178 $242,668,883 $256,372,621 $254,355,208 $186,358,044 $185,136,737
====================================================================================================================================
Undistributed (Over-distribution
of) net investment
income at the
end of year $ (46,057) $ 452,975 $ (373,447) $ (39,416) $ (125,424) $ (88,622)
====================================================================================================================================
See accompanying notes to financial statements.
35
Statement of
CHANGES IN NET ASSETS (Unaudited) (continued)
CALIFORNIA SELECT TAX-FREE (NXC) NEW YORK SELECT TAX-FREE (NXN)
-------------------------------- ------------------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
3/31/04 3/31/03 3/31/04 3/31/03
------------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 4,230,020 $ 4,423,162 $ 2,640,505 $ 2,739,961
Net realized gain from investments 528,424 919,407 314,601 630,086
Change in net unrealized appreciation
(depreciation) of investments 704,451 728,613 294,010 1,060,980
------------------------------------------------------------------------------------------------------------------------------------
Net increase in net assets
from operations 5,462,895 6,071,182 3,249,116 4,431,027
------------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (4,262,921) (4,592,689) (2,668,659) (2,742,795)
From accumulated net realized gains
from investments (310,999) (849,710) (322,333) (366,890)
------------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from
distributions to shareholders (4,573,920) (5,442,399) (2,990,992) (3,109,685)
------------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from shares
issued to shareholders due to
reinvestment of distributions -- -- 16,500 --
------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets 888,975 628,783 274,624 1,321,342
Net assets at the beginning of year 90,975,122 90,346,339 56,683,078 55,361,736
------------------------------------------------------------------------------------------------------------------------------------
Net assets at the end of year $91,864,097 $90,975,122 $56,957,702 $56,683,078
====================================================================================================================================
Undistributed (Over-distribution of) net
investment income at the
end of year $ (114,580) $ (75,837) $ 2,359 $ 30,688
====================================================================================================================================
See accompanying notes to financial statements.
36
Notes to
FINANCIAL STATEMENTS
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The Trusts covered in this report and their corresponding Common share New York
Stock Exchange symbols are Nuveen Select Tax-Free Income Portfolio (NXP), Nuveen
Select Tax-Free Income Portfolio 2 (NXQ), Nuveen Select Tax-Free Income
Portfolio 3 (NXR), Nuveen California Select Tax-Free Income Portfolio (NXC) and
Nuveen New York Select Tax-Free Income Portfolio (NXN). The Trusts are
registered under the Investment Company Act of 1940, as amended, as closed-end,
diversified management investment companies.
Each Trust seeks to provide stable dividends consistent with the preservation of
capital, exempt from regular federal and designated state income taxes, where
applicable, by investing primarily in a diversified portfolio of municipal
obligations.
The following is a summary of significant accounting policies followed by the
Trusts 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 Trust's investment portfolio are provided
by a pricing service approved by the Trust's Board of 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, evaluations
of anticipated cash flows or collateral and general market conditions. If it is
determined that market prices for a security are unavailable or inappropriate,
the Board of Trustees of the Trusts, or its designee, 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 Trusts have instructed the custodian
to segregate assets with a current value at least equal to the amount of the
when-issued and delayed delivery purchase commitments. At March 31, 2004, New
York Select Tax-Free (NXN) had an outstanding when-issued purchase commitment of
$834,420. There were no such outstanding purchase commitments in any of the
other Trusts.
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 Trust is a separate taxpayer for federal income tax purposes. Each Trust
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 Trust intends to satisfy conditions which will
enable interest from municipal securities, which is exempt from regular federal
and designated state income taxes, where applicable, to retain such tax-exempt
status when distributed to shareholders of the Trusts. All monthly tax-exempt
income dividends paid during the fiscal year ended March 31, 2004, have been
designated Exempt Interest Dividends.
Dividends and Distributions to Shareholders
Dividends from tax-exempt net investment income are declared monthly. 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.
37
Notes to
FINANCIAL STATEMENTS (continued)
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 distributions are determined in accordance with
federal income tax regulations, which may differ from accounting principles
generally accepted in the United States.
Derivative Financial Instruments
The Trusts are not authorized to invest in derivative financial instruments.
Custodian Fee Credit
Each Trust has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by credits earned on each Trust's cash on deposit
with the bank. Such deposit arrangements are an alternative to overnight
investments.
Indemnifications
Under the Trusts' organizational documents, its Officers and Trustees are
indemnified against certain liabilities arising out of the performance of their
duties to the Trusts. In addition, in the normal course of business, the Trusts
enter into contracts that provide general indemnifications to other parties. The
Trusts' maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Trusts that have not yet
occurred.
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 from operations during the reporting period. Actual
results may differ from those estimates.
2. FUND SHARES
Transactions in Common shares were as follows:
SELECT SELECT SELECT
TAX-FREE (NXP) TAX-FREE 2 (NXQ) TAX-FREE 3 (NXR)
----------------------- ----------------------- -----------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
3/31/04 3/31/03 3/31/04 3/31/03 3/31/04 3/31/03
---------------------------------------------------------------------------------------------------------
Shares issued to
shareholders due to
reinvestment of
distributions -- -- -- -- -- --
=========================================================================================================
CALIFORNIA SELECT NEW YORK SELECT
TAX-FREE (NXC) TAX-FREE (NXN)
----------------------- -----------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
3/31/04 3/31/03 3/31/04 3/31/03
---------------------------------------------------------------------------------------------------------
Shares issued to
shareholders due to
reinvestment of distributions -- -- 1,154 --
=========================================================================================================
3. SECURITIES TRANSACTIONS
Purchases and sales (including maturities) of investments in long-term municipal
securities during the fiscal year ended March 31, 2004, were as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
---------------------------------------------------------------------------------------------------------
Purchases $37,515,280 $24,783,282 $10,055,292 $29,251,064 $11,433,307
Sales and maturities 38,823,150 26,664,100 10,832,900 27,001,829 8,980,045
=========================================================================================================
38
4. INCOME TAX INFORMATION
The following information is presented on an income tax basis. 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.
At March 31, 2004, the cost of investments were as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
----------------------------------------------------------------------------------------------------------
Cost of investments $223,489,078 $240,848,151 $175,500,669 $86,128,891 $53,508,150
==========================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at March 31, 2004, were as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
---------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $17,435,869 $12,715,594 $8,929,552 $4,595,134 $3,147,206
Depreciation (2,034,771) (2,197,898) (888,361) (93,226) (22,477)
---------------------------------------------------------------------------------------------------------
Net unrealized appreciation
of investments $15,401,098 $10,517,696 $8,041,191 $4,501,908 $3,124,729
=========================================================================================================
The tax components of undistributed net investment income and net realized gains
at March 31, 2004, were as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
---------------------------------------------------------------------------------------------------------
Undistributed net tax-exempt income $639,159 $577,541 $554,901 $235,627 $216,645
Undistributed net ordinary income* 14,208 -- -- -- --
Undistributed net long-term capital gains 310,956 440,630 5,168 292,669 173,872
=========================================================================================================
* Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
The tax character of distributions paid during the fiscal years ended March 31,
2004 and March 31, 2003, was designated for purposes of the dividends paid
deduction as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
2004 (NXP) (NXQ) (NXR) (NXC) (NXN)
----------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $12,087,037 $12,571,449 $8,945,252 $4,242,294 $2,672,502
Distributions from net ordinary income* 334,467 163,837 63,927 27,740 --
Distributions from net long-term
capital gains 1,399,973 973,580 868,194 310,142 322,333
==========================================================================================================
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
2003 (NXP) (NXQ) (NXR) (NXC) (NXN)
----------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $13,511,932 $14,208,907 $9,995,343 $4,636,488 $2,754,516
Distributions from net ordinary income* 37,830 46,670 3,378 -- --
Distributions from net long-term
capital gains 2,726,793 3,133,168 850,958 849,710 366,890
==========================================================================================================
* Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
39
Notes to
FINANCIAL STATEMENTS (continued)
5. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
Under the Trusts' investment management agreements with Nuveen Institutional
Advisory Corp. (the "Adviser"), a wholly owned subsidiary of Nuveen Investments,
Inc., each Trust pays an annual management fee, payable monthly, at the rates
set forth below, which are based upon the average daily net assets of each Trust
as follows:
SELECT TAX-FREE 2 (NXQ)
SELECT TAX-FREE 3 (NXR)
CALIFORNIA SELECT TAX-FREE (NXC)
AVERAGE DAILY NET ASSETS SELECT TAX-FREE (NXP) NEW YORK SELECT TAX-FREE (NXN)
---------------------------------------------------------------------------------------------------------
For the first $125 million .2500% .3000%
For the next $125 million .2375 .2875
For the next $250 million .2250 .2750
For the next $500 million .2125 .2625
For the next $1 billion .2000 .2500
For net assets over $2 billion .1875 .2375
=========================================================================================================
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Trusts pay no
compensation directly to those of its Trustees who are affiliated with the
Adviser or to their officers, all of whom receive remuneration for their
services to the Trusts from the Adviser or its affiliates.
6. INVESTMENT COMPOSITION
At March 31, 2004, the revenue sources by municipal purpose, expressed as a
percent of total investments, were as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
---------------------------------------------------------------------------------------------------------
Consumer Staples 3% 5% 5% 2% 2%
Education and Civic Organizations 2 4 6 14 13
Healthcare 17 16 18 15 10
Housing/Multifamily -- 6 7 -- 8
Housing/Single Family 3 3 3 -- 8
Long-Term Care -- -- -- 1 9
Materials 4 2 -- -- --
Tax Obligation/General 10 6 8 22 7
Tax Obligation/Limited 16 13 12 10 13
Transportation 14 16 8 15 6
U.S. Guaranteed 15 10 8 -- 6
Utilities 10 15 22 10 6
Water and Sewer 6 3 3 11 12
Other -- 1 -- -- --
---------------------------------------------------------------------------------------------------------
100% 100% 100% 100% 100%
=========================================================================================================
Certain investments owned by the Trusts are covered by insurance issued by
several private insurers or are backed by an escrow or trust containing U.S.
Government or U.S. Government agency securities, both of which ensure the timely
payment of principal and interest in the event of default (53% for Select
Tax-Free (NXP), 53% for Select Tax-Free 2 (NXQ), 37% for Select Tax-Free 3
(NXR), 65% for California Select Tax-Free (NXC), and 60% for New York Select
Tax-Free (NXN)). Such insurance or escrow, however, does not guarantee the
market value of the municipal securities or the value of any of the Trusts'
shares.
For additional information regarding each investment security, refer to the
Portfolio of Investments of each Trust.
40
7. SUBSEQUENT EVENT - DISTRIBUTIONS TO SHAREHOLDERS
The Trusts declared dividend distributions from their tax-exempt net investment
income which were paid on May 3, 2004, to shareholders of record on April 15,
2004, as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
---------------------------------------------------------------------------------------------------------
Dividend per share $.0610 $.0585 $.0575 $.0560 $.0560
=========================================================================================================
41
Financial
HIGHLIGHTS
Selected data for a share outstanding throughout each year:
INVESTMENT OPERATIONS LESS DISTRIBUTIONS
----------------------------------- ----------------------------
NET
REALIZED/ ENDING
BEGINNING NET UNREALIZED NET NET ENDING
NET ASSET INVESTMENT INVESTMENT INVESTMENT CAPITAL ASSET MARKET
VALUE INCOME GAIN (LOSS) TOTAL INCOME GAINS TOTAL VALUE VALUE
==================================================================================================================================
SELECT TAX-FREE (NXP)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 $14.82 $.73 $ .15 $ .88 $(.76) $(.09) $(.85) $14.85 $14.3000
2003 14.67 .77 .37 1.14 (.82) (.17) (.99) 14.82 14.1500
2002 15.05 .88 (.38) .50 (.86) (.02) (.88) 14.67 13.8500
2001 14.89 .91 .15 1.06 (.90) -- (.90) 15.05 14.5000
2000 15.55 .90 (.66) .24 (.90) -- (.90) 14.89 13.6875
SELECT TAX-FREE 2 (NXQ)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 14.45 .70 .19 .89 (.72) (.06) (.78) 14.56 13.8000
2003 14.53 .76 .14 .90 (.80) (.18) (.98) 14.45 13.4900
2002 14.89 .86 (.36) .50 (.84) (.02) (.86) 14.53 13.6600
2001 14.75 .87 .14 1.01 (.87) -- (.87) 14.89 14.1500
2000 15.41 .87 (.66) .21 (.87) -- (.87) 14.75 13.3750
SELECT TAX-FREE 3 (NXR)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 14.28 .69 .16 .85 (.69) (.07) (.76) 14.37 13.5600
2003 14.26 .73 .12 .85 (.76) (.07) (.83) 14.28 13.0600
2002 14.53 .81 (.28) .53 (.80) -- (.80) 14.26 13.4200
2001 14.32 .81 .21 1.02 (.81) -- (.81) 14.53 13.7000
2000 14.98 .82 (.66) .16 (.82) -- (.82) 14.32 12.8750
CALIFORNIA SELECT TAX-FREE (NXC)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 14.54 .68 .19 .87 (.68) (.05) (.73) 14.68 14.0600
2003 14.44 .71 .26 .97 (.73) (.14) (.87) 14.54 13.5900
2002 14.79 .78 (.34) .44 (.77) (.02) (.79) 14.44 14.2500
2001 14.57 .79 .23 1.02 (.79) (.01) (.80) 14.79 13.9400
2000 15.26 .79 (.67) .12 (.79) (.02) (.81) 14.57 13.7500
NEW YORK SELECT TAX-FREE (NXN)
----------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 14.51 .68 .14 .82 (.68) (.08) (.76) 14.57 14.4000
2003 14.17 .70 .43 1.13 (.70) (.09) (.79) 14.51 13.6000
2002 14.51 .73 (.33) .40 (.74) -- (.74) 14.17 13.7600
2001 14.31 .78 .20 .98 (.78) -- (.78) 14.51 14.0500
2000 14.92 .78 (.61) .17 (.78) -- (.78) 14.31 12.6875
==================================================================================================================================
RATIOS/SUPPLEMENTAL DATA
--------------------------------------------------------------------------------------
TOTAL RETURNS BEFORE CREDIT AFTER CREDIT**
----------------------- -------------------------- ----------------------------
RATIO OF NET RATIO OF NET
BASED ON ENDING RATIO OF INVESTMENT RATIO OF INVESTMENT
BASED ON NET NET EXPENSES TO INCOME TO EXPENSES TO INCOME TO PORTFOLIO
MARKET ASSET ASSETS AVERAGE AVERAGE AVERAGE AVERAGE TURNOVER
VALUE* VALUE* (000) NET ASSETS NET ASSETS NET ASSETS NET ASSETS RATE
====================================================================================================================================
SELECT TAX-FREE (NXP)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 7.34% 6.13% $243,165 .34% 4.90% .33% 4.91% 16%
2003 9.51 7.84 242,669 .37 5.20 .36 5.21 35
2002 1.54 3.41 240,275 .38 5.89 .37 5.89 26
2001 12.63 7.32 246,475 .35 6.06 .35 6.07 2
2000 (11.09) 1.62 243,814 .36 5.97 .36 5.97 --
SELECT TAX-FREE 2 (NXQ)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 8.35 6.31 256,373 .39 4.86 .38 4.86 10
2003 6.01 6.33 254,355 .42 5.20 .41 5.21 46
2002 2.57 3.41 255,887 .43 5.79 .42 5.80 21
2001 12.46 7.04 262,144 .41 5.89 .40 5.90 2
2000 (10.38) 1.43 259,660 .40 5.82 .40 5.82 1
SELECT TAX-FREE 3 (NXR)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 9.96 6.13 186,358 .38 4.84 .38 4.85 6
2003 3.51 6.09 185,137 .42 5.09 .41 5.10 51
2002 3.84 3.70 184,837 .44 5.59 .42 5.60 9
2001 12.97 7.36 188,344 .47 5.66 .46 5.67 2
2000 (10.29) 1.11 185,671 .41 5.65 .41 5.65 --
CALIFORNIA SELECT TAX-FREE (NXC)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 9.14 6.16 91,864 .40 4.64 .39 4.65 30
2003 1.34 6.86 90,975 .43 4.84 .42 4.85 42
2002 7.95 3.03 90,346 .44 5.27 .43 5.28 12
2001 7.23 7.21 92,517 .43 5.38 .42 5.39 2
2000 (7.57) .90 91,166 .45 5.37 .45 5.38 3
NEW YORK SELECT TAX-FREE (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2004 11.81 5.84 56,958 .43 4.65 .42 4.65 16
2003 4.73 8.17 56,683 .46 4.85 .45 4.86 35
2002 3.17 2.75 55,362 .49 5.04 .48 5.05 28
2001 17.36 7.02 56,679 .48 5.39 .47 5.40 3
2000 (11.18) 1.21 55,924 .50 5.36 .49 5.37 --
====================================================================================================================================
* 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 Net Asset Value is the
combination of reinvested dividend income at net asset value, reinvested
capital gains distributions at net asset value, if any, and changes in net
asset value per share. Total returns are not annualized.
** After custodian fee credit, where applicable.
See accompanying notes to financial statements.
42-43 SPREAD
Trustees
AND OFFICERS
The management of the Trusts, including general supervision of the duties
performed for the Trusts by the Adviser, is the responsibility of the Board of
Trustees of the Trusts. The number of trustees of the Trusts is currently set at
twelve. None of the trustees who are not "interested" persons of the Trusts has
ever been a director or employee of, or consultant to, Nuveen or its affiliates.
The names and business addresses of the trustees and officers of the Trusts,
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 IN
POSITION(S) YEAR FIRST PRINCIPAL OCCUPATION(S) FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS THE TRUSTS APPOINTED(2) DURING PAST 5 YEARS TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
TRUSTEE WHO IS AN INTERESTED PERSON OF THE TRUSTS:
------------------------------------------------------------------------------------------------------------------------------------
Timothy R. Schwertfeger (1) Chairman of 1994 Chairman and Director (since 1996) of Nuveen 144
3/28/49 the Board Investments, Inc. and Nuveen Investments, LLC; Director
333 W. Wacker Drive and Trustee (since 1992) and Chairman (since 1996) of Nuveen
Chicago, IL 60606 Advisory Corp. and Nuveen Institutional Advisory Corp.;
Chairman and Director (since 1997) of Nuveen Asset
Management, Inc.; Director (since 1996) of Institutional
Capital Corporation; Chairman and Director (since 1999)
of Rittenhouse Asset Management, Inc.; Chairman of
Nuveen Investments Advisers Inc. (since 2002).
TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE TRUSTS:
------------------------------------------------------------------------------------------------------------------------------------
Robert P. Bremner Trustee 1997 Private Investor and Management Consultant. 144
8/22/40
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Lawrence H. Brown Trustee 1993 Retired (1989) as Senior Vice President of The Northern 144
7/29/34 Trust Company; Director, Community Advisory Board for
333 W. Wacker Drive Highland Park and Highwood, United Way of the North
Chicago, IL 60606 Shore (since 2002).
------------------------------------------------------------------------------------------------------------------------------------
Jack B. Evans Trustee 1999 President, The Hall-Perrine Foundation, a private 144
10/22/48 philanthropic corporation (since 1996); Director,
333 W. Wacker Drive Alliant Energy; Director and Vice Chairman, United
Chicago, IL 60606 Fire & Casualty Company; formerly Director, Federal
Reserve Bank of Chicago; formerly, President and Chief
Operating Officer, SCI Financial Group, Inc., a regional
financial services firm.
------------------------------------------------------------------------------------------------------------------------------------
William C. Hunter Trustee 2004 Dean and Distinguished Professor of Finance, School of 144
3/6/48 Business at the University of Connecticut; previously
333 W. Wacker Drive Senior Vice President and Director of Research at the
Chicago, IL 60606 Federal Reserve Bank of Chicago (1995-2003); Director,
Credit Research Center at Georgetown University; Director
of Xerox Corporation (since 2004).
------------------------------------------------------------------------------------------------------------------------------------
Anne E. Impellizzeri* Trustee 1994 Retired, formerly, Executive Director (since 1998) of 144
1/26/33 Manitoga (Center for Russel Wright's Design with Nature);
333 W. Wacker Drive prior thereto, President and Chief Executive Officer of
Chicago, IL 60606 Blanton-Peale Institute (since 1990); prior thereto, Vice
President, Metropolitan Life Insurance Co.
------------------------------------------------------------------------------------------------------------------------------------
William L. Kissick* Trustee 1992 Professor Emeritus, School of Medicine and the Wharton 144
7/29/32 School of Management and former Chairman, Leonard Davis
333 W. Wacker Drive Institute of Health Economics, University of
Chicago, IL 60606 Pennsylvania; Adjunct Professor, Health Policy and
Management, Yale University.
------------------------------------------------------------------------------------------------------------------------------------
Thomas E. Leafstrand* Trustee 1992 Retired; previously, Vice President in charge of 144
11/11/31 Municipal Underwriting and Dealer Sales at The Northern
333 W. Wacker Drive Trust Company.
Chicago, IL 60606
44
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST PRINCIPAL OCCUPATION(S) FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY
AND ADDRESS THE TRUSTS APPOINTED(2) DURING PAST 5 YEARS TRUSTEE
------------------------------------------------------------------------------------------------------------------------------------
TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE TRUSTS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
Peter R. Sawers* Trustee 1991 Adjunct Professor of Business and Economics, University 144
4/3/33 of Dubuque, Iowa; formerly (1991-2000) Adjunct
333 W. Wacker Drive Professor, Lake Forest Graduate School of Management,
Chicago, IL 60606 Lake Forest, Illinois; prior thereto, Executive
Director, Towers Perrin Australia, a management
consulting firm; Chartered Financial Analyst;
Certified Management Consultant; Director, Executive
Service Corps of Chicago, a not-for-profit organization.
------------------------------------------------------------------------------------------------------------------------------------
William J. Schneider Trustee 1997 Senior Partner and Chief Operating Officer, 144
9/24/44 Miller-Valentine Group, Vice President, Miller-Valentine
333 W. Wacker Drive Realty, a construction company; Chair, Miami Valley
Chicago, IL 60606 Hospital; Chair, Dayton Development Coalition; formerly,
Member, Community Advisory Board, National City Bank,
Dayton, Ohio and Business Advisory Council, Cleveland
Federal Reserve Bank.
------------------------------------------------------------------------------------------------------------------------------------
Judith M. Stockdale Trustee 1997 Executive Director, Gaylord and Dorothy Donnelley 144
12/29/47 Foundation (since 1994); prior thereto, Executive
333 W. Wacker Drive Director, Great Lakes Protection Fund (from 1990 to 1994)
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Sheila W. Wellington* Trustee 1994 Clinical Professor of Management, Stern/NYU Business 144
2/24/32 School (since 2003); formerly, President (since 1993)
333 W. Wacker Drive of Catalyst (a not-for-profit organization focusing
Chicago, IL 60606 on women's leadership development in business and the
professions).
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE TRUSTS APPOINTED(3) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE TRUSTS:
------------------------------------------------------------------------------------------------------------------------------------
Gifford R. Zimmerman Chief 1988 Managing Director (since 2002), Assistant Secretary and 144
9/9/56 Administrative Associate General Counsel, formerly, Vice President and
333 W. Wacker Drive Officer Assistant General Counsel of Nuveen Investments, LLC;
Chicago, IL 60606 Managing Director (since 2002), General Counsel and
Assistant Secretary, formerly, Vice President of Nuveen
Advisory Corp. and Nuveen Institutional Advisory Corp.;
Managing Director (since 2002), Assistant Secretary and
Associate General Counsel, formerly, Vice President (since
2000), of Nuveen Asset Management, Inc. Assistant
Secretary of Nuveen Investments, Inc. (since 1994);
Assistant Secretary of NWQ Investment Management Company,
LLC (since 2002); Vice President and Assistant Secretary
of Nuveen Investments Advisers Inc. (since 2002); Managing
Director, Associate General Counsel and Assistant Secretary
of Rittenhouse Asset Management, Inc. (since 2003);
Chartered Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, Assistant Vice 144
2/3/66 and Assistant President (since 2000), previously, Associate of Nuveen
333 W. Wacker Drive Secretary Investments, LLC.
Chicago, IL 60606
45
Trustees
AND OFFICERS (CONTINUED)
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE TRUSTS APPOINTED(3) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE TRUSTS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
Paul L. Brennan Vice President 1999 Vice President (since 2002), formerly, Assistant Vice 128
11/10/66 President (since 1997), of Nuveen Advisory Corp.; prior
333 W. Wacker Drive thereto, portfolio manager of Flagship Financial Inc.;
Chicago, IL 60606 Chartered Financial Analyst and Certified Public
Accountant.
------------------------------------------------------------------------------------------------------------------------------------
Peter H. D'Arrigo Vice President 1999 Vice President of Nuveen Investments, LLC (since 1999), 144
11/28/67 and Treasurer prior thereto, Assistant Vice President (since 1997);
333 W. Wacker Drive Vice President and Treasurer of Nuveen Investments,
Chicago, IL 60606 Inc. (since 1999); Vice President and Treasurer of Nuveen
Advisory Corp. and Nuveen Institutional Advisory Corp
(since 1999); Vice President and Treasurer of Nuveen Asset
Management, Inc. (since 2002) and of Nuveen Investments
Advisers Inc. (since 2002); Assistant Treasurer of NWQ
Investment Management Company, LLC (since 2002); Vice
President and Treasurer of Nuveen Rittenhouse Asset
Management, Inc. (since 2003); Chartered Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Susan M. DeSanto Vice President 2001 Vice President of Nuveen Advisory Corp. (since 2001); 144
9/8/54 previously, Vice President of Van Kampen Investment
333 W. Wacker Drive Advisory Corp. (since 1998); Vice President of Nuveen
Chicago, IL 60606 Institutional Advisory Corp. (since 2002); prior thereto,
Assistant Vice President of Van Kampen Investment
Advisory Corp. (since 1994).
------------------------------------------------------------------------------------------------------------------------------------
Jessica R. Droeger Vice President 2000 Vice President (since 2002) and Assistant General 144
9/24/64 and Secretary Counsel (since 1998); formerly, Assistant Vice President
333 W. Wacker Drive (since 1998) of Nuveen Investments, LLC; Vice President
Chicago, IL 60606 (since 2002) and Assistant Secretary (since 1998),
formerly Assistant Vice President of Nuveen Advisory
Corp. and Nuveen Institutional Advisory Corp.
------------------------------------------------------------------------------------------------------------------------------------
Lorna C. Ferguson Vice President 1998 Managing Director (since 2004) formerly, Vice President 144
10/24/45 of Nuveen Investments, LLC; Managing Director (since
333 W. Wacker Drive 2004) formerly, Vice President (since 1998) of Nuveen
Chicago, IL 60606 Advisory Corp. and Nuveen Institutional Advisory Corp.
------------------------------------------------------------------------------------------------------------------------------------
William M. Fitzgerald Vice President 1995 Managing Director (since 2002) of Nuveen Investments, 144
3/2/64 LLC; Managing Director (since 2001), formerly Vice
333 W. Wacker Drive President of Nuveen Advisory Corp. and Nuveen
Chicago, IL 60606 Institutional Advisory Corp. (since 1995); Managing
Director of Nuveen Asset Management, Inc. (since
2001); Vice President of Nuveen Investment Advisers
Inc. (since 2002); Chartered Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds Controller 144
5/31/54 and Controller (since 1998) of Nuveen Investments, LLC and Vice
333 W. Wacker Drive President and Funds Controller (since 1998) of
Chicago, IL 60606 Nuveen Investments, Inc.; Certified Public Accountant.
------------------------------------------------------------------------------------------------------------------------------------
J. Thomas Futrell Vice President 1988 Vice President of Nuveen Advisory Corp.; Chartered 128
7/5/55 Financial Analyst.
333 W. Wacker Drive
Chicago, IL 60606
46
NUMBER OF
PORTFOLIOS IN
POSITION(S) YEAR FIRST FUND COMPLEX
NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY
AND ADDRESS THE TRUSTS APPOINTED(3) DURING PAST 5 YEARS OFFICER
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE TRUSTS (CONTINUED):
------------------------------------------------------------------------------------------------------------------------------------
Steven J. Krupa Vice President 1990 Vice President of Nuveen Advisory Corp. 128
8/21/57
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen Investments, 144
3/22/63 LLC, previously Assistant Vice President (since 1999);
333 W. Wacker Drive prior thereto, Associate of Nuveen Investments, LLC;
Chicago, IL 60606 Certified Public Accountant.
------------------------------------------------------------------------------------------------------------------------------------
Tina M. Lazar Vice President 2002 Vice President (since 1999), previously, Assistant Vice 144
8/27/61 President (since 1993) of Nuveen Investments, LLC.
333 W. Wacker Drive
Chicago, IL 60606
------------------------------------------------------------------------------------------------------------------------------------
Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and Assistant 144
7/27/51 and Assistant General Counsel of Nuveen Investments, LLC; Vice
333 W. Wacker Drive Secretary President and Assistant Secretary of Nuveen Advisory
Chicago, IL 60606 Corp. and Nuveen Institutional Advisory Corp.; Assistant
Secretary of Nuveen Investments, Inc. and (since 1997)
Nuveen Asset Management, Inc.; Vice President (since
2000), Assistant Secretary and Assistant General
Counsel (since 1998) of Rittenhouse Asset Management,
Inc.; Vice President and Assistant Secretary of
Nuveen Investments Advisers Inc. (since 2002);
Assistant Secretary of NWQ Investment Management
Company, LLC (since 2002).
------------------------------------------------------------------------------------------------------------------------------------
John V. Miller Vice President 2003 Vice President (since 2003) previously, Assistant 128
4/10/67 Vice President (since 1999), prior thereto, credit
333 W. Wacker Drive analyst (since 1996) of Nuveen Advisory Corp.;
Chicago, IL 60606 Chartered Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Edward F. Neild, IV Vice President 1996 Managing Director (since 2002) of Nuveen Investments, 144
7/7/65 LLC; Managing Director (since 1997), formerly Vice
333 W. Wacker Drive President (since 1996) of Nuveen Advisory Corp. and
Chicago, IL 60606 Nuveen Institutional Advisory Corp.; Managing Director
of Nuveen Asset Management, Inc. (since 1999).
Chartered Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Daniel S. Solender Vice President 2003 Vice President of Nuveen Advisory Corp. (since 2003); 128
10/27/65 previously, Principal and portfolio manager with The
333 W. Wacker Drive Vanguard Group (1999-2003); prior thereto, Assistant
Chicago, IL 60606 Vice President of the Nuveen Advisory Corp.; Chartered
Financial Analyst.
------------------------------------------------------------------------------------------------------------------------------------
Thomas C. Spalding Vice President 1982 Vice President of Nuveen Advisory Corp. and Nuveen 128
7/31/51 Institutional Advisory Corp.; Chartered Financial
333 W. Wacker Drive Analyst.
Chicago, IL 60606
* Trustee will be retiring on June 30, 2004.
(1) Mr. Schwertfeger is an "interested person" of the Trusts, as defined in the
Investment Company Act of 1940, because he is an officer and trustee of the
Adviser.
(2) Trustees serve an indefinite term until his/her successor is elected. The
year first elected or appointed represents the year in which the Trustee
was first elected or appointed to any fund in the Nuveen Complex.
(3) Officers serve one year terms through July of each year. The year first
elected or appointed represents the year in which the Officer was first
elected or appointed to any fund in the Nuveen Complex.
47
Build Your Wealth
AUTOMATICALLY
Sidebar text: 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.
48
Fund
INFORMATION
BOARD OF TRUSTEES
Robert P. Bremner
Lawrence H. Brown
Jack B. Evans
William C. Hunter
Anne E. Impellizzeri
William L. Kissick
Thomas E. Leafstrand
Peter R. Sawers
William J. Schneider
Timothy R. Schwertfeger
Judith M. Stockdale
Sheila W. Wellington
FUND MANAGER
Nuveen Institutional Advisory Corp.
333 West Wacker Drive
Chicago, IL 60606
CUSTODIAN
State Street Bank & Trust
Boston, MA
TRANSFER AGENT AND
SHAREHOLDER SERVICES
State Street Bank & Trust
Nuveen Funds
P.O. Box 43071
Providence, RI 02940-3071
(800) 257-8787
LEGAL COUNSEL
Chapman and Cutler LLP
Chicago, IL
INDEPENDENT AUDITORS
Ernst & Young LLP
Chicago, IL
PROXY VOTING POLICIES AND PROCEDURES
A description of the policies and procedures that the Funds use to determine how
to vote proxies relating to portfolio securities is available (i) without
charge, upon request, by calling Nuveen Investments at (800) 257-8787; and (ii)
on the Commission's website at http://www.sec.gov.
GLOSSARY OF TERMS USED IN THIS REPORT
Average Annual Total Return: This is a commonly used method to express an
investment's performance over a particular, usually multi-year time period. It
expresses the return (including change in NAV and reinvested dividends) that
would have been necessary on an annual basis to equal the investment's actual
performance over the time period being considered.
Average Effective Maturity: The average of all the maturities of the bonds in a
fund's portfolio, computed by weighting each maturity date (the date the
security comes due) by the market value of the security. This figure does not
account for the likelihood of prepayments or the exercise of call provisions.
Leverage-Adjusted Duration: Duration is a measure of a bond or bond fund's
sensitivity to changes in interest rates. Generally, the longer a bond or fund's
duration, the more the price of the bond or fund will change as interest rates
change. 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.
Market Yield (also known as Dividend Yield or Current Yield): An investment's
current annualized dividend divided by its current market price.
Net Asset Value (NAV): A fund's NAV is calculated by subtracting the liabilities
of the fund from its total assets and then dividing the remainder by the number
of shares outstanding. Fund NAVs are calculated at the end of each business day.
Taxable-Equivalent Yield: The yield necessary from a fully taxable investment to
equal, on an after-tax basis, the yield of a municipal bond investment.
---------
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 March 31, 2004. Any future repurchases
will be reported to shareholders in the next annual or semiannual report.
49
Serving Investors
FOR GENERATIONS
Since 1898, financial advisors and their clients have relied on Nuveen
Investments to provide dependable investment solutions. For the past century,
Nuveen Investments has adhered to the belief that the best approach to investing
is to apply conservative risk-management principles to help minimize volatility.
Building on this tradition, we today offer a range of high quality equity and
fixed-income solutions that are integral to a well-diversified core portfolio.
Our clients have come to appreciate this diversity, as well as our continued
adherence to proven, long-term investing principles.
Managing $90 billion in assets, Nuveen Investments offers access to a number of
different asset classes and investing solutions through a variety of products.
Nuveen Investments markets its capabilities under four distinct brands: Nuveen,
a leader in tax-free investments; NWQ, a leader in value-style equities;
Rittenhouse, a leader in growth-style equities; and Symphony, a leading
institutional manager of market-neutral alternative investment portfolios.
To learn more about the products and services Nuveen Investments offers and for
a prospectus, where applicable, talk to your financial advisor, or call us at
(800) 257-8787. Please read the information carefully before you invest.
Distributed by
NUVEEN INVESTMENTS, LLC | 333 West Wacker Drive | Chicago, Illinois 60606
| www.nuveen.com
EAN-B-0304D
ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the registrant has adopted
a code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller, or
persons performing similar functions. The registrant has posted such code of
ethics on its website at www.nuveen.com/etf.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
During the reporting period, the registrant's board of directors determined that
the registrant had at least one "audit committee financial expert" (as defined
in Item 3 of Form N-CSR) serving on its Audit Committee. The registrant's audit
committee financial expert for the reporting period was William E. Bennett, who
is "independent" for purposes of Item 3 of Form N-CSR.
Although Mr. Bennett served as the audit committee financial expert for the
reporting period he unexpectedly resigned from the Board effective April 30,
2004. The Nominating and Governance Committee has begun to evaluate existing
Audit Committee Members to determine whether any qualify as audit committee
financial experts. In addition, the Nominating and Governance Committee has
begun a search for a new board member that would be a suitable replacement for
Mr. Bennett.
Mr. Bennett was formerly Executive Vice President and Chief Credit Officer of
First Chicago Corporation and its principal subsidiary, The First National Bank
of Chicago. As part of his role as Chief Credit Officer, Mr. Bennett set policy
as to accrual of assets/loans; designated performing/non-performing assets; set
the level of reserves against the credit portfolo; and determined the carrying
value of credit related assets and exposure. Among other things, Mr. Bennett was
also responsible for the oversight of the internal analysis function including
setting ground rules for the review and preparation of financial analysis and
financial statements for use in making credit and risk decisions for financial
analysis and financial statements for use in making credit and risk decisions
for clients. Mr. Bennett has significant experience reviewing, analyzing and
evaluating financial statements of domestic and international companies in a
variety of industries with complex accounting issues.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
NUVEEN CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO
FORM N-CSR DISCLOSURE RE: AUDIT FEES
The following table shows the amount of fees that Ernst & Young LLP, the Fund's
auditor, billed to the Fund during the Fund's last two full fiscal years. For
engagements with Ernst & Young LLP entered into on or after May 6, 2003, the
Audit Committee approved in advance all audit services and non-audit services
that Ernst & Young LLP provided to the Fund, except for those non-audit services
that were subject to the pre-approval exception under Rule 2-01 of Regulation
S-X (the "pre-approval exception"). The pre-approval exception for services
provided directly to the Fund waives the pre-approval requirement for services
other than audit, review or attest services if: (A) the aggregate amount of all
such services provided constitutes no more than 5% of the total amount of
revenues paid by the Fund during the fiscal year in which the services are
provided; (B) the Fund did not recognize the services as non-audit services at
the time of the engagement; and (C) the services are promptly brought to the
Audit Committee's attention, and the Committee (or its delegate) approves the
services before the audit is completed.
The Audit Committee has delegated certain pre-approval responsibilities to its
Chairman (or, in his absence, any other member of the Audit Committee).
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE FUND
AUDIT FEES BILLED AUDIT-RELATED FEES TAX FEES ALL OTHER FEES
FISCAL YEAR ENDED TO FUND BILLED TO FUND BILLED TO FUND BILLED TO FUND
=============================================================================================================================
March 31, 2004 $ 7,419 $ 0 $ 364 $ 0
-----------------------------------------------------------------------------------------------------------------------------
Percentage approved N/A 0% 0% 0%
pursuant to
pre-approval
exception
-----------------------------------------------------------------------------------------------------------------------------
March 31, 2003 $ 6,747 $ 0 $ 350 $ 0
-----------------------------------------------------------------------------------------------------------------------------
Percentage approved N/A 0% 0% 0%
pursuant to
pre-approval
exception
-----------------------------------------------------------------------------------------------------------------------------
The above "Tax Fees" were billed for professional services for tax advice, tax
compliance and tax planning.
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE
ADVISER AND AFFILIATED FUND SERVICE PROVIDERS
The following table shows the amount of fees billed by Ernst & Young LLP to
Nuveen Institutional Advisory Corp. ("NIAC" or the "Adviser"), and any entity
controlling, controlled by or under common control with NIAC ("control
Affiliate") that provides ongoing services to the Fund ("Affiliated Fund Service
Provider"), for engagements directly related to the Fund's operations and
financial reporting, during the Fund's last two full fiscal years.
The table also shows the percentage of fees subject to the pre-approval
exception. The pre-approval exception for services provided to the Adviser and
any Affiliated Fund Service Provider (other than audit, review or attest
services) waives the pre-approval requirement if: (A) the aggregate amount of
all such services provided constitutes no more than 5% of the total amount of
revenues paid to Ernst & Young LLP by the Fund, the Adviser and Affiliated Fund
Service Providers during the fiscal year in which the services are provided that
would have to be pre-approved by the Audit Committee; (B) the Fund did not
recognize the services as non-audit services at the time of the engagement; and
(C) the services are promptly brought to the Audit Committee's attention, and
the Committee (or its delegate) approves the services before the Fund's audit is
completed.
FISCAL YEAR ENDED AUDIT-RELATED FEES TAX FEES BILLED TO ALL OTHER FEES
BILLED TO ADVISER AND ADVISER AND BILLED TO ADVISER
AFFILIATED FUND AFFILIATED FUND AND AFFILIATED FUND
SERVICE PROVIDERS SERVICE PROVIDERS SERVICE PROVIDERS
========================================================================================================
March 31, 2004 $ 0 $ 0 $ 0
--------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
--------------------------------------------------------------------------------------------------------
March 31, 2003 $ 0 $ 0 $ 0
--------------------------------------------------------------------------------------------------------
Percentage approved N/A N/A N/A
pursuant to
pre-approval
exception
--------------------------------------------------------------------------------------------------------
NON-AUDIT SERVICES
The following table shows the amount of fees that Ernst & Young LLP billed
during the Fund's last two full fiscal years for non-audit services. For
engagements entered into on or after May 6, 2003, the Audit Committee is
required to pre-approve non-audit services that Ernst & Young LLP provides to
the Adviser and any Affiliated Fund Services Provider, if the engagement related
directly to the Fund's operations and financial reporting (except for those
subject to the de minimis exception described above). The Audit Committee
requested and received information from Ernst & Young LLP about any non-audit
services that Ernst & Young LLP rendered during the Fund's last fiscal year to
the Adviser and any Affiliated Fund Service Provider. The Committee considered
this information in evaluating Ernst & Young LLP independence.
FISCAL YEAR ENDED TOTAL NON-AUDIT FEES
BILLED TO ADVISER AND
AFFILIATED FUND SERVICE TOTAL NON-AUDIT FEES
PROVIDERS (ENGAGEMENTS BILLED TO ADVISER AND
RELATED DIRECTLY TO THE AFFILIATED FUND SERVICE
TOTAL NON-AUDIT FEES OPERATIONS AND FINANCIAL PROVIDERS (ALL OTHER
BILLED TO FUND REPORTING OF THE FUND) ENGAGEMENTS) TOTAL
===================================================================================================================
March 31, 2004 $ 364 $ 0 $ 0 $ 364
March 31, 2003 $ 350 $ 0 $ 0 $ 350
Audit Committee Pre-Approval Policies and Procedures. Generally, the audit
committee must approve (i) all non-audit services to be performed for the Fund
by the Fund's independent accountants and (ii) all audit and non-audit services
to be performed by the Fund's independent accountants for the Affiliated Fund
Service Providers with respect to operations and financial reporting of the
Fund. Regarding tax and research projects conducted by the independent
accountants for the Fund and Affiliated Fund Service Providers (with respect to
operations and financial reports of the Fund) such engagements will be (i)
pre-approved by the audit committee if they are expected to be for amounts
greater than $10,000; (ii) reported to the audit committee chairman for his
verbal approval prior to engagement if they are expected to be for amounts under
$10,000 but greater than $5,000; and (iii) reported to the audit committee at
the next audit committee meeting if they are expected to be for an amount under
$5,000.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable at this time.
ITEM 6. SCHEDULE OF INVESTMENTS.
Not applicable at this time.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
In the rare event that a municipal issuer held by the Fund were to issue a proxy
or that the Fund were to receive a proxy issued by a cash management security,
Nuveen Advisory Corp. (the "Adviser") would either engage an independent third
party to determine how the proxy should be voted or vote the proxy with the
consent, or based on the instructions, of the Fund's Board of Directors or
Trustees or its representative. In the case of a conflict of interest, the proxy
would be submitted to the applicable Fund's Board to determine how the proxy
should be voted. A member of the Adviser's legal department would oversee the
administration of the voting, and ensure that records were maintained in
accordance with Rule 204-2(c)(2) under the Investment Advisers Act of 1940 (17
CFR 275.204-2(c)(2)), reports were filed with the SEC on Form N-PX, and the
results were provided to the Board of Directors or Trustees and made available
to shareholders as required by applicable rules.
ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable at this time.
ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
In the event of a vacancy on the Board, the nominating and governance committee
receives suggestions from various sources as to suitable candidates. Suggestions
should be sent in writing to Lorna Ferguson, Vice President for Board Relations,
Nuveen Investments, 333 West Wacker Drive, Chicago, IL 60606. The nominating and
governance committee sets appropriate standards and requirements for nominations
for new directors and reserves the right to interview all candidates and to make
the final selection of any new directors.
ITEM 10. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of this report that includes the disclosure
required by this paragraph, based on their evaluation of the controls
and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")(17 CFR
240.13a-15(b) or 240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) that occurred during the registrant's last
fiscal half-year (the registrant's second fiscal half-year in the case
of an annual report) that has materially affected, or is reasonably
likely to materially affect, the registrant's internal control over
financial reporting.
ITEM 11. EXHIBITS.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit: Not applicable
because posted on registrant's website at www.nuveen.com/etf.
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: Ex-99.CERT
Attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under
the 1940 Act (17 CFR 270.23c-1) sent a giver during the period covered by the
report by or on behalf of the registrant to 10 or more persons. Not applicable
at this time.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act,
provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR
270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR
240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished
pursuant to this paragraph will not be deemed "filed" for purposes of Section 18
of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of
that section. Such certification will not be deemed to be incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant specifically incorporates it by
reference. Ex-99.906 CERT attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Nuveen California Select Tax-Free Income Portfolio
-----------------------------------------------------------
By (Signature and Title)* /s/ Jessica R. Droeger
----------------------------------------------
Jessica R. Droeger
Vice President and Secretary
Date: June 9, 2004
-------------------------------------------------------------------
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title)* /s/ Gifford R. Zimmerman
----------------------------------------------
Gifford R. Zimmerman
Chief Administrative Officer
(Principal Executive Officer)
Date: June 9, 2004
-------------------------------------------------------------------
By (Signature and Title)* /s/ Stephen D. Foy
----------------------------------------------
Stephen D. Foy
Vice President and Controller
(Principal Financial Officer)
Date: June 9, 2004
-------------------------------------------------------------------
* Print the name and title of each signing officer under his or her signature.