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OMB APPROVAL
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OMB Number: 3235-0570
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Expires: January 31, 2014
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Estimated average burden
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hours per response: 20.6
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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 811-08000
Invesco Van Kampen Select Sector Municipal Trust
(Exact name of registrant as specified in charter)
1555 Peachtree Street, N.E., Atlanta, Georgia 30309
(Address of principal executive offices) (Zip code)
Colin Meadows 1555 Peachtree Street, N.E., Atlanta, Georgia 30309
(Name and address of agent for service)
Registrants telephone number, including area code: (713) 626-1919
Date of fiscal year end: 2/28
Date of reporting period: 2/29/12
Item 1. Reports to Stockholders.
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Annual Report to Shareholders
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February 29, 2012
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Invesco Van Kampen Select Sector Municipal Trust
NYSE:VKL
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2
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Performance Summary
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2
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Management Discussion
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4
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Additional Information
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5
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Dividend Reinvestment Plan
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6
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Schedule of Investments
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18
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Financial Statements
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21
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Notes to Financial Statements
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27
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Financial Highlights
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29
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Auditors Report
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30
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Tax Information
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31
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Supplemental Information
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T-1
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Trustees and Officers
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Managements Discussion of Trust Performance
Performance summary
This is the annual report of Invesco Van Kampen Select Sector
Municipal Trust for
the fiscal year ended February 29, 2012. The Trusts return can be calculated based
on either the market price or the net asset value (NAV) of its shares. NAV per share
is determined by dividing the value of the Trusts portfolio securities, cash and other
assets, less all liabilities and preferred shares, by the total number of common shares
outstanding. Market price reflects the supply and demand for Trust shares. As a
result, the two returns can differ, as they did during the reporting period. Main
contributors to return on an NAV basis were the Trusts yield curve positioning
and exposure to hospital bonds.
Performance
Total returns, 2/28/11 to 2/29/12
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Trust at NAV
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23.59
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%
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Trust at Market Value
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28.24
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Barclays Municipal Bond Index
▼
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12.42
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Market Price Premium to NAV as of 2/29/12
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4.05
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Source:
▼
Lipper Inc.
The performance data quoted represent past performance and cannot guarantee comparable future
results; current performance may be lower or higher. Investment return, net asset value and common
share market price will fluctuate so that you may have a gain or loss when you sell shares. Please visit
invesco.com/us for the most recent month-end performance. Performance figures reflect Trust expenses,
the reinvestment of distributions (if any) and changes in net asset value (NAV) for performance based on
NAV and changes in market price for performance based on market price.
Since the Trust is a closed-end management
investment company, shares of the Trust may trade at
a discount or premium from the NAV. This characteristic is separate and distinct from the risk that NAV
could decrease as a result of investment activities and may be a greater risk to investors expecting to
sell their shares after a short time. The Trust cannot predict whether shares will trade at, above or
below NAV. The Trust should not be viewed as a vehicle for trading purposes. It is designed primarily for risk-tolerant long-term investors.
How we invest
We seek to provide investors with a high
level of current income exempt from
federal income tax, consistent with preservation
of capital, primarily through
investment in a portfolio of investment
grade municipal securities.
We seek to achieve the Trusts investment
objective by investing primarily in
municipal securities that are rated investment
grade by at least one nationally
recognized statistical rating organization
and that are exempt from federal taxes.
Municipal obligations include municipal
bonds, municipal notes, municipal commercial
paper and lease obligations. The
Trust also may invest in non-investment
grade and unrated securities that we determine
to be of comparable or higher quality.
From time to time, we may invest in municipal
securities that pay interest that is subject
to the federal alternative minimum tax.
We employ a bottom-up, research-driven
approach to identify securities that
have attractive risk/reward characteristics
for the sectors in which we invest. We also
integrate macroeconomic analysis and
forecasting into our evaluation and ranking
of various sectors and individual securities.
Finally, we employ leverage in an
effort to enhance the Trusts income and
total return.
Sell decisions are based on:
n
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|
A deterioration or likely deterioration
of an individual issuers capacity to
meet its debt obligations on a timely
basis.
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n
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|
A deterioration or likely deterioration
of the broader fundamentals of a
particular industry or sector.
|
n
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|
Opportunities in the secondary or
primary market to purchase a security
with better relative value.
|
Market conditions and your Trust
For the fiscal year ended February 29,
2012, the municipal market performed
strongly. The Barclays Municipal Bond
Index returned 12.42%, outperforming
other fixed income indexes such as the
Barclays U.S. Aggregate Index, which
returned 8.37%; the Barclays U.S. Corporate
High Yield Index, which returned
6.94%; the Barclays U.S. Corporate
Investment Grade Index, which returned
10.37%; and the Barclays U.S. Mortgage
Backed Securities Index, which returned
6.44%.
1
During 2011, credit fundamentals
remained strong, and default rates
continued their downward trend. In line
with the drop exhibited from 2009 to
2010, the number of defaults in 2011
was muted and lower than 2010. Despite
Portfolio Composition
By credit sector, based on total investments
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Revenue Bonds
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87.7
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%
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General Obligation Bonds
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7.0
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Pre-refunded Bonds
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1.9
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Other
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3.4
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Top Five Fixed Income Holdings
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1.
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Charleston Educational Excellence
Finance Corp.
(Charleston County School District)
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5.9
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%
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2.
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New York & New Jersey (States of)
Port Authority;
One Hundred Forty-Fourth
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4.1
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3.
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New York & New Jersey (States of)
Port Authority;
One Hundred Fifty-Second
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3.6
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4.
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Spokane (City of)
Public Facilities District
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2.7
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5.
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Colorado (State of)
Educational & Cultural
Facilities Authority
(Academy of Charter Schools)
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2.6
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Total Net Assets
Applicable to Common Shares
|
|
$191.5 million
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Total Number of Holdings
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311
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|
The Trusts holdings are subject to change, and
there is no assurance that the Trust will continue
to hold any particular security.
2
Invesco Van Kampen Select Sector Municipal Trust
a few high profile bankruptcies such as
Harrisburg, Pennsylvania, Jefferson
County, Alabama and Central Falls,
Rhode Island, defaults came nowhere
near the hundreds of billions of dollars
predicted by well-known analyst Meredith Whitney
at the end of 2010.
2
In terms of municipal fund flows,
Whitneys prediction raised concerns
regarding the credit stability of municipalities
and the heightened risk of unprecedented
defaults in 2011. Retail investors,
who already had been making withdrawals
from municipal bond mutual funds,
heeded Ms. Whitneys warning and began
to sell shares at a record pace.
3
Money
was withdrawn from municipal mutual
funds for 29 straight weeks
3
, but by the
end of the third quarter of 2011, the tide
had changed. This increase in demand in
the third quarter had a positive effect on
municipal market performance during
the reporting period.
In terms of yield curve positioning,
the Trusts exposure to the intermediate
(15- to 20-years) part and the long end
of the yield curve (20+ years) contributed
to Trust returns as municipal yields
approached all-time lows
3
during the
reporting period. Some of our yield curve
and duration positioning was obtained
through the use of inverse floating rate
securities. Inverse floating rate securities
are instruments which have an inverse
relationship to a referenced interest rate.
Inverse floating rate securities can be a
more efficient means of managing duration,
yield curve exposure and credit
exposure. Also, they potentially can
enhance yield.
Sector performance was driven by
spread tightening between lower rated
and higher rated investment grade
municipal securities for most of the
reporting period, largely a result of
declining yields, increased demand and
lower tax-exempt issuance. As a result,
lower quality sectors outperformed and
contributed to Trust performance as we
held overweight exposure to these market
segments. Our unrated holdings also
contributed to relative performance.
At a sector level, our exposure to hospital,
industrial development revenue/pollution
control revenue, and transportation
bonds contributed to returns for the
reporting period. Our underweight
exposure to state general obligation
bonds detracted from returns.
One important factor impacting the
return of the Trust relative to its comparative
index was the Trusts use of structural
leverage. The Trust uses leverage
because we believe that, over time, leveraging
provides opportunities for additional
income and total return for
common shareholders. However, use of
leverage also can expose common shareholders
to additional volatility. For example,
if the prices of securities held by a
trust decline, the negative impact of
these valuation changes on common
share net asset value and common shareholder
total return is magnified by the
use of leverage. Conversely, leverage
may enhance common share returns during
periods when the prices of securities
held by a trust generally are rising. Leverage
made a positive contribution to the
performance of the Trust during the
reporting period.
During the reporting period, the Trust
achieved a leveraged position through
the use of tender option bonds and auction
rate preferred shares. As of the close
of the reporting period, leverage
accounted for 40% of the Trusts total
assets. For more information about the
Trusts use of leverage, see the Notes to
Financial Statements later in this report.
As stated earlier, the Trust trades at a
market price and also has an NAV. During
the reporting period, the Trust fluctuated
between trading at a premium and trading
at a discount to its underlying NAV.
The Trust began and ended the reporting
period trading at a premium. It traded at
a discount from July to the beginning of
November.
Thank you for investing in Invesco
Van Kampen Select Sector Municipal
Trust and for sharing our long-term
investment horizon.
1 Source: Lipper Inc.
2 Source: CBS
3 Source:
The Bond Buyer
The views and opinions expressed in managements
discussion of Trust performance are those of Invesco
Advisers, Inc. These views and opinions are subject
to change at any time based on factors such as market
and economic conditions. These views and opinions
may not be relied upon as investment advice or
recommendations, or as an offer for a particular
security. The information is not a complete analysis
of every aspect of any market, country, industry,
security or the Trust. Statements of fact are from
sources considered reliable, but Invesco Advisers,
Inc. makes no representation or warranty as to their
completeness or accuracy. Although historical performance
is no guarantee of future results, these
insights may help you understand our investment
management philosophy.
See important Trust and, if applicable, index
disclosures later in this report.
Thomas Byron
Portfolio manager,
is manager of Invesco
Van Kampen Select
Sector Municipal Trust.
He joined Invesco in 2010.
Mr. Byron was associated with the Trusts
previous investment adviser or its investment
advisory affiliates in an investment
capacity from 1981 to 2010 and began
managing the Trust in 2009. He earned a
B.S. in finance from Marquette University
and an M.B.A. in finance from DePaul
University.
Robert Stryker
Chartered Financial
Analyst, portfolio
manager, is manager
of Invesco Van Kampen
Select Sector Municipal
Trust. He joined Invesco in 2010.
Mr. Stryker was associated with the
Trusts previous investment adviser or
its investment advisory affiliates in an
investment capacity from 1994 to 2010
and began managing the Trust in 2009.
He earned a B.S. in finance from the
University of Illinois, Chicago.
Robert Wimmel
Portfolio manager,
is manager of Invesco
Van Kampen Select
Sector Municipal Trust.
He joined Invesco in 2010.
Mr. Wimmel was associated with the
Trusts previous investment adviser or
its investment advisory affiliates in an
investment capacity from 1996 to 2010
and began managing the Trust in 2001.
He earned a B.A. in anthropology from
the University of Cincinnati and an M.A.
in economics from the University of
Illinois, Chicago.
Effective March 1, 2012, after the close
of the reporting period, Richard Berry
and Stephen Turman left the management
team.
3
Invesco Van Kampen Select Sector Municipal Trust
Additional Information
n
|
|
Unless otherwise stated, information presented in this report is as of February 29, 2012, and is based on total net assets
applicable to common shares.
|
|
n
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|
Unless otherwise noted, all data provided by Invesco.
|
|
n
|
|
To access your Trusts reports, visit invesco.com/fundreports.
|
About indexes used in this report
n
|
|
The
Barclays Municipal Bond Index
is an unmanaged index considered
representative of the tax-exempt
bond market.
|
|
n
|
|
The
Barclays U.S. Aggregate Index
is an unmanaged index considered
representative of the US investment-grade,
fixed-rate bond market.
|
|
n
|
|
The
Barclays U.S. Corporate High
Yield Index
is an unmanaged index
that covers the universe of fixed-rate,
noninvestment-grade debt.
|
|
n
|
|
The
Barclays U.S. Corporate
Investment Grade Index
is an
unmanaged index considered
representative of fixed-rate, investment-
grade taxable bond debt.
|
n
|
|
The
Barclays U.S. Mortgage Backed
Securities Index
is an unmanaged
index comprising 15- and 30-year
fixed-rate securities backed by
mortgage pools of Ginnie Mae,
Freddie Mac and Fannie Mae.
|
n
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|
The Trust is not managed to track the
performance of any particular index,
including the index(es) defined here,
and consequently, the performance
of the Trust may deviate significantly
from the performance of the index(es).
|
n
|
|
A direct investment cannot be made
in an index. Unless otherwise indicated,
index results include reinvested dividends,
and they do not reflect sales
charges. Performance of the peer
group, if applicable, reflects trust
expenses; performance of a market
index does not.
|
Other information
n
|
|
The Chartered Financial Analyst
®
(CFA
®
)
designation is globally recognized and
attests to a charterholders success in a
rigorous and comprehensive study program
in the field of investment management
and research analysis.
|
|
n
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|
The returns shown in managements
discussion of Trust performance are
based on net asset values calculated
for shareholder transactions. Generally
accepted accounting principles require
adjustments to be made to the net
assets of the Trust at period end for
financial reporting purposes, and as
such, the net asset values for shareholder
transactions and the returns
based on those net asset values may
differ from the net asset values and
returns reported in the Financial
Highlights
|
NOT FDIC INSURED | MAY LOSE VALUE | NO BANK GUARANTEE
4
Invesco Van Select Sector Municipal Trust
Dividend Reinvestment Plan
The dividend reinvestment plan (the Plan) offers you a prompt and simple way to reinvest your dividends and capital gains distributions
(Distributions) into additional shares of your Trust. Under the Plan, the money you earn from Distributions will be reinvested
automatically in more shares of your Trust, allowing you to potentially increase your investment over time.
|
Plan benefits
n
|
|
Add to your account:
You may increase the amount of shares
in your Trust easily and automatically with
the Plan.
|
|
n
|
|
Low transaction costs:
Transaction costs are low because the
new shares are generally bought in blocks
and the per share fee is shared among all
participants.
|
|
n
|
|
Convenience:
You will receive a detailed account statement
from Computershare Trust Company,
N.A. (the Agent) which administers the
Plan. The statement shows your total
Distributions, date of investment, shares
acquired, and price per share, as well as the
total number of shares in your reinvestment
account. You can also access your account
at invesco.com/us.
|
|
n
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|
Safekeeping:
The Agent will hold the shares it has
acquired for you in safekeeping.
|
How to participate in the Plan
If you own shares in your own name, you can
participate directly in the Plan. If your shares
are held in street name in the name of
your brokerage firm, bank, or other financial
institution you must instruct that entity to
participate on your behalf. If they are unable
to participate on your behalf, you may request
that they reregister your shares in your own
name so that you may enroll in the Plan.
How to enroll
To enroll in the Plan, please read the Terms
and Conditions in the Plan Brochure. You can
enroll in the Plan by visiting invesco.com/us,
calling toll-free 800 341 2929 or notifying
us in writing at Invesco Closed-End Funds,
Computershare Trust Company, N.A.,
P.O. Box 43078, Providence, RI 02940-3078.
Please include your Trust name and account
number and ensure that all shareholders listed
on the account sign these written instructions.
Your participation in the Plan will begin with
the next Distribution payable after the Agent
receives your authorization, as long as they
receive it before the record date, which is
generally 10 business days before such
dividend is paid. If your authorization arrives
after such record date, your participation in the
Plan will begin with the following Distributions.
How the Plan Works
If you choose to participate in the Plan,
whenever your Trust declares such Distributions,
it will be invested in additional shares of
your Trust that are purchased on the open
market.
Costs of the Plan
There is no direct charge to you for reinvesting
Distributions because the Plans fees are
paid by your Trust. However, you will pay your
portion of any per share fees incurred when
the new shares are purchased on the open
market. These fees are typically less than the
standard brokerage charges for individual
transactions, because shares are purchased
for all Participants in blocks, resulting in lower
fees for each individual Participant. Any per
share or service fees are added to the
purchase price. Per share fees include any
applicable brokerage commissions the Agent
is required to pay.
Tax implications
The automatic reinvestment of Distributions
does not relieve you of any income tax that
may be due on Distributions. You will receive
tax information annually to help you prepare
your federal income tax return.
Invesco does not offer tax advice. The tax
information contained herein is general and is
not exhaustive by nature. It was not intended or
written to be used, and it cannot be used, by any
taxpayer for avoiding penalties that may be
imposed on the taxpayer under U.S. federal tax
laws. Federal and state tax laws are complex and
constantly changing. Shareholders should
always consult a legal or tax adviser for
information concerning their individual situation.
How to withdraw from the Plan
You may withdraw from the Plan at any
time by calling 800 341 2929, visiting
invesco.com/us or by writing to Invesco
Closed-End Funds, Computershare Trust
Company, N.A., P.O. Box 43078, Providence,
RI 02940-3078. Simply indicate that you
would like to withdraw from the Plan, and be
sure to include your Trust name and account
number. Also, ensure that all shareholders
listed on the account have signed these
written instructions. If you withdraw, you have
three options with regard to the shares held in
the Plan:
1.
|
|
If you opt to continue to hold your
non-certificated whole shares (Investment
Plan Book Shares), they will be held
by the Agent electronically as Direct
Registration Book-Shares (Book-Entry
Shares) and fractional shares will be sold
at the then current market price.
Proceeds will be sent via check to your
address of record after deducting
applicable fees.
|
|
2.
|
|
If you opt to sell your shares through the
Agent, we will sell all full and fractional
shares and send the proceeds via check
to your address of record after deducting
a $2.50 service fee and per share fees.
Per share fees include any applicable
brokerage commissions the Agent is
required to pay.
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|
3.
|
|
You may sell your shares through your
financial adviser through the Direct
Registration System (DRS). DRS is a
service within the securities industry that
allows Trust shares to be held in your
name in electronic format. You retain full
ownership of your shares, without having
to hold a share certificate. You should
contact your financial adviser to learn
more about any restrictions or fees that
may apply.
|
To obtain a complete copy of the Dividend
Reinvestment Plan, please call our Client
Services department at 800 341 2929 or
visit invesco.com/us.
5
Invesco Van Kampen Select Sector Municipal Trust
Schedule
of Investments
February 29,
2012
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|
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|
|
|
|
|
Principal
|
|
|
|
|
Interest
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|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Municipal Obligations166.55%
|
Alabama2.11%
|
|
|
|
|
|
|
|
|
|
|
|
|
Bessemer Governmental Utility Services Corp.;
Series 2008 A, Ref. Water Supply RB
(INSAGC)
(a)(b)
|
|
|
5.00
|
%
|
|
|
06/01/39
|
|
|
$
|
750
|
|
|
$
|
793,388
|
|
|
Birmingham (City of) Airport Authority; Series 2010, RB
(INSAGM)
(a)
|
|
|
5.25
|
%
|
|
|
07/01/30
|
|
|
|
600
|
|
|
|
663,228
|
|
|
Courtland (City of) Industrial Development Board (International
Paper Co.); Series 2005 A, Ref. Solid Waste
Disposal RB
(c)
|
|
|
5.20
|
%
|
|
|
06/01/25
|
|
|
|
1,250
|
|
|
|
1,277,850
|
|
|
Health Care Authority for Baptist Health (The);
Series 2009 A, RB
(d)(e)
|
|
|
6.13
|
%
|
|
|
05/15/12
|
|
|
|
500
|
|
|
|
504,660
|
|
|
Selma (City of) Industrial Development Board;
Series 2009 A, Gulf Opportunity Zone RB
|
|
|
6.25
|
%
|
|
|
11/01/33
|
|
|
|
725
|
|
|
|
796,630
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,035,756
|
|
|
Alaska0.66%
|
|
|
|
|
|
|
|
|
|
|
|
|
Alaska (State of) Industrial Development & Export
Authority (Providence Health Services);
Series 2011 A, RB
(b)
|
|
|
5.50
|
%
|
|
|
10/01/41
|
|
|
|
1,125
|
|
|
|
1,258,740
|
|
|
Arizona5.50%
|
|
|
|
|
|
|
|
|
|
|
|
|
Arizona (State of) Transportation Board;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 B, Highway RB
|
|
|
5.00
|
%
|
|
|
07/01/25
|
|
|
|
610
|
|
|
|
702,531
|
|
|
Series 2008 B,
Highway RB
(b)
|
|
|
5.00
|
%
|
|
|
07/01/26
|
|
|
|
915
|
|
|
|
1,048,297
|
|
|
Series 2011 A, Ref. Sub.
Highway RB
(b)
|
|
|
5.00
|
%
|
|
|
07/01/36
|
|
|
|
945
|
|
|
|
1,058,249
|
|
|
Glendale (City of) Industrial Development Authority (John C.
Lincoln Health Network); Series 2005, Ref. Hospital RB
|
|
|
5.00
|
%
|
|
|
12/01/35
|
|
|
|
1,155
|
|
|
|
1,124,369
|
|
|
Glendale (City of) Industrial Development Authority (Midwestern
University);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2010, RB
|
|
|
5.00
|
%
|
|
|
05/15/35
|
|
|
|
250
|
|
|
|
261,193
|
|
|
Series 2010, RB
|
|
|
5.13
|
%
|
|
|
05/15/40
|
|
|
|
500
|
|
|
|
522,795
|
|
|
Goodyear (City of) McDowell Road Commercial Corridor Improvement
District; Series 2007, Special Assessment Improvement Bonds
(INSAMBAC)
(a)
|
|
|
5.25
|
%
|
|
|
01/01/32
|
|
|
|
1,000
|
|
|
|
1,044,820
|
|
|
Maricopa (County of) Industrial Development Authority (Catholic
Healthcare West); Series 2009 C, Health
Facilities RB
(d)(e)
|
|
|
5.00
|
%
|
|
|
07/01/14
|
|
|
|
800
|
|
|
|
866,320
|
|
|
Maricopa County Pollution Control Corp. (Arizona Public Service
Co.Palo Verde); Series 2009 B, Ref.
PCR
(d)(e)
|
|
|
5.50
|
%
|
|
|
05/01/12
|
|
|
|
500
|
|
|
|
503,630
|
|
|
Navajo County Pollution Control Corp.;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009 C,
PCR
(d)(e)
|
|
|
5.50
|
%
|
|
|
06/01/14
|
|
|
|
225
|
|
|
|
242,705
|
|
|
Series 2009 E,
PCR
(d)(e)
|
|
|
5.75
|
%
|
|
|
06/01/16
|
|
|
|
275
|
|
|
|
314,322
|
|
|
Phoenix (City of) Industrial Development Authority (Career
Success Schools);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009, Education RB
|
|
|
7.00
|
%
|
|
|
01/01/39
|
|
|
|
240
|
|
|
|
237,108
|
|
|
Series 2009, Education RB
|
|
|
7.13
|
%
|
|
|
01/01/45
|
|
|
|
220
|
|
|
|
219,360
|
|
|
Pima (County of) Industrial Development Authority (Global Water
Resources, LLC); Series 2007, Water &
Wastewater RB
(c)
|
|
|
6.55
|
%
|
|
|
12/01/37
|
|
|
|
800
|
|
|
|
822,224
|
|
|
Salt River Project Agricultural Improvement & Power
District; Series 2009 A, Electric
System RB
(b)
|
|
|
5.00
|
%
|
|
|
01/01/28
|
|
|
|
750
|
|
|
|
859,808
|
|
|
University Medical Center Corp.; Series 2005, Hospital RB
|
|
|
5.00
|
%
|
|
|
07/01/35
|
|
|
|
700
|
|
|
|
710,591
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
10,538,322
|
|
|
California13.63%
|
|
|
|
|
|
|
|
|
|
|
|
|
Alameda (County of) Corridor Transportation Authority;
Series 2004 A, Ref. Sub. Lien Conv. CAB RB
(INSAMBAC)
(a)(f)
|
|
|
0.00
|
%
|
|
|
10/01/24
|
|
|
|
2,500
|
|
|
|
2,478,225
|
|
|
Bay Area Toll Authority (San Francisco Bay Area);
Series 2008 F-1, Toll
Bridge RB
(b)
|
|
|
5.00
|
%
|
|
|
04/01/39
|
|
|
|
1,905
|
|
|
|
2,040,465
|
|
|
Beverly Hills Unified School District (Election of 2008);
Series 2009, Unlimited Tax CAB GO
Bonds
(f)
|
|
|
0.00
|
%
|
|
|
08/01/28
|
|
|
|
300
|
|
|
|
159,219
|
|
|
California (State of) Department of Water Resources (Central
Valley);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 AE, Water
System RB
(b)
|
|
|
5.00
|
%
|
|
|
12/01/24
|
|
|
|
275
|
|
|
|
326,315
|
|
|
Series 2008 AE, Water
System RB
(b)
|
|
|
5.00
|
%
|
|
|
12/01/25
|
|
|
|
325
|
|
|
|
384,612
|
|
|
Series 2008 AE, Water
System RB
(b)
|
|
|
5.00
|
%
|
|
|
12/01/26
|
|
|
|
325
|
|
|
|
383,793
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
6 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
California(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 AE, Water
System RB
(b)
|
|
|
5.00
|
%
|
|
|
12/01/27
|
|
|
$
|
225
|
|
|
$
|
264,166
|
|
|
Series 2008 AE, Water
System RB
(b)
|
|
|
5.00
|
%
|
|
|
12/01/28
|
|
|
|
325
|
|
|
|
380,136
|
|
|
California (State of) Health Facilities Financing Authority
(Catholic Healthcare West); Series 2009 A, RB
|
|
|
6.00
|
%
|
|
|
07/01/34
|
|
|
|
400
|
|
|
|
464,628
|
|
|
California (State of) Housing Finance Agency;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 K, Home
Mortgage RB
(c)
|
|
|
5.30
|
%
|
|
|
08/01/23
|
|
|
|
1,100
|
|
|
|
1,106,380
|
|
|
Series 2008 K, Home
Mortgage RB
(c)
|
|
|
5.45
|
%
|
|
|
08/01/28
|
|
|
|
1,300
|
|
|
|
1,328,236
|
|
|
California (State of) Pollution Control Financing Authority
(Waste Management Inc.); Series 2002 B, Solid Waste
Disposal RB
(c)
|
|
|
5.00
|
%
|
|
|
07/01/27
|
|
|
|
500
|
|
|
|
510,530
|
|
|
California (State of) Statewide Communities Development
Authority (Kaiser Permanente); Series 2009 A, RB
|
|
|
5.00
|
%
|
|
|
04/01/19
|
|
|
|
500
|
|
|
|
598,670
|
|
|
California (State of);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009, Various Purpose Unlimited Tax GO Bonds
|
|
|
5.75
|
%
|
|
|
04/01/31
|
|
|
|
425
|
|
|
|
496,022
|
|
|
Series 2009 A, Ref. Economic Recovery Unlimited Tax GO
Bonds
|
|
|
5.25
|
%
|
|
|
07/01/21
|
|
|
|
700
|
|
|
|
860,986
|
|
|
Daly City (City of) Housing Development Finance Agency
(Franciscan Mobile Home Park Acquisition);
Series 2007 C, Ref. Third Tier Mobile Home Park RB
|
|
|
6.50
|
%
|
|
|
12/15/47
|
|
|
|
200
|
|
|
|
198,874
|
|
|
Los Angeles (County of) Public Works Financing Authority;
Series 1996 A, Ref. Sr. Lien RB
(INSAGM)
(a)
|
|
|
5.50
|
%
|
|
|
10/01/18
|
|
|
|
1,405
|
|
|
|
1,608,486
|
|
|
Morongo Band of Mission Indians (The) (Enterprise Casino);
Series 2008 B, RB
(g)
|
|
|
5.50
|
%
|
|
|
03/01/18
|
|
|
|
100
|
|
|
|
99,873
|
|
|
Palm Springs (City of) Financing Authority (Convention Center
Expansion); Series 2004 A, Lease RB
(INSNATL)
(a)
|
|
|
5.50
|
%
|
|
|
11/01/35
|
|
|
|
3,500
|
|
|
|
3,665,865
|
|
|
Palomar Pomerado Health; Series 2009, COP
|
|
|
6.75
|
%
|
|
|
11/01/39
|
|
|
|
400
|
|
|
|
429,928
|
|
|
San Diego (County of) Regional Airport Authority;
Series 2010 A, Sub. RB
|
|
|
5.00
|
%
|
|
|
07/01/34
|
|
|
|
525
|
|
|
|
567,105
|
|
|
San Diego Community College District (Election of 2006);
Series 2011, Unlimited Tax GO
Bonds
(b)
|
|
|
5.00
|
%
|
|
|
08/01/36
|
|
|
|
2,295
|
|
|
|
2,583,941
|
|
|
San Francisco (City & County of) Airport Commission
(San Francisco International Airport);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008
A-4,
Ref.
Second
Series RB
(c)(d)(h)
|
|
|
6.50
|
%
|
|
|
05/01/12
|
|
|
|
450
|
|
|
|
454,356
|
|
|
Series 2010 F, Second Series RB
|
|
|
5.00
|
%
|
|
|
05/01/40
|
|
|
|
1,000
|
|
|
|
1,078,110
|
|
|
Series 2011 F, Ref. Second
Series RB
(c)
|
|
|
5.00
|
%
|
|
|
05/01/25
|
|
|
|
280
|
|
|
|
313,278
|
|
|
Series 2011 F, Ref. Second
Series RB
(c)
|
|
|
5.00
|
%
|
|
|
05/01/26
|
|
|
|
560
|
|
|
|
621,449
|
|
|
San Francisco (City & County of) Public Utilities
Commission (Water System Improvement Program); Subseries
2011 A,
Water RB
(b)
|
|
|
5.00
|
%
|
|
|
11/01/36
|
|
|
|
1,215
|
|
|
|
1,369,232
|
|
|
Twin Rivers Unified School District (School Facility Bridge
Funding Program); Series 2007, COP
(INSAGM)
(a)(d)(e)
|
|
|
3.50
|
%
|
|
|
05/31/13
|
|
|
|
500
|
|
|
|
500,575
|
|
|
Vernon (City of); Series 2009 A, Electric System RB
|
|
|
5.13
|
%
|
|
|
08/01/21
|
|
|
|
750
|
|
|
|
815,242
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
26,088,697
|
|
|
Colorado7.68%
|
|
|
|
|
|
|
|
|
|
|
|
|
Colorado (State of) Educational & Cultural Facilities
Authority (Academy of Charter Schools); Series 2004,
Charter School RB
(INSSGI)
(a)
|
|
|
5.50
|
%
|
|
|
05/01/36
|
|
|
|
5,000
|
|
|
|
5,070,500
|
|
|
Colorado (State of) Educational & Cultural Facilities
Authority (National Jewish Federation Bond Program);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2003
A-1,
VRD RB
(LOCBank of
America, N.A.)
(i)(j)
|
|
|
0.13
|
%
|
|
|
09/01/33
|
|
|
|
2,100
|
|
|
|
2,100,000
|
|
|
Series 2004
A-5,
VRD RB
(LOCBank of
America, N.A.)
(i)(j)
|
|
|
0.13
|
%
|
|
|
04/01/34
|
|
|
|
500
|
|
|
|
500,000
|
|
|
Series 2007
A-11,
VRD RB
(LOCBank of
America, N.A.)
(i)(j)
|
|
|
0.13
|
%
|
|
|
08/01/27
|
|
|
|
1,535
|
|
|
|
1,535,000
|
|
|
Colorado (State of) Health Facilities Authority (Catholic
Health); Series 2006 C5, RB
(INSAGM)
(a)(b)
|
|
|
5.00
|
%
|
|
|
09/01/36
|
|
|
|
1,725
|
|
|
|
1,815,062
|
|
|
Colorado (State of) Health Facilities Authority (Volunteers of
America Care); Series 2007 A, Health &
Residential Care Facilities RB
|
|
|
5.30
|
%
|
|
|
07/01/37
|
|
|
|
400
|
|
|
|
351,028
|
|
|
Colorado (State of) Regional Transportation District (Denver
Transit Partners Eagle P3);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2010, Private Activity RB
|
|
|
6.50
|
%
|
|
|
01/15/30
|
|
|
|
550
|
|
|
|
623,573
|
|
|
Series 2010, Private Activity RB
|
|
|
6.00
|
%
|
|
|
01/15/34
|
|
|
|
450
|
|
|
|
488,156
|
|
|
Montrose (County of) Memorial Hospital Board of Trustees;
Series 2003, Enterprise RB
|
|
|
6.00
|
%
|
|
|
12/01/33
|
|
|
|
1,500
|
|
|
|
1,564,035
|
|
|
Salida (City of) Hospital District; Series 2006, RB
|
|
|
5.25
|
%
|
|
|
10/01/36
|
|
|
|
708
|
|
|
|
661,668
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,709,022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
7 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Connecticut1.22%
|
|
|
|
|
|
|
|
|
|
|
|
|
Connecticut (State of) Development Authority (Aquarion Water
Co.); Series 2007, Ref. Water Facilities RB
(INSSGI)
(a)(c)
|
|
|
5.10
|
%
|
|
|
09/01/37
|
|
|
$
|
1,375
|
|
|
$
|
1,388,461
|
|
|
Connecticut (State of) Housing Finance Authority; Subseries 2010
D-2, Housing Mortgage Finance
Program RB
(c)
|
|
|
5.00
|
%
|
|
|
05/15/31
|
|
|
|
580
|
|
|
|
608,008
|
|
|
Hamden (Town of) (Whitney Center); Series 2009 B,
Entrance Fee Principal Redemption RB
|
|
|
6.13
|
%
|
|
|
01/01/14
|
|
|
|
325
|
|
|
|
325,325
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,321,794
|
|
|
District of Columbia1.20%
|
|
|
|
|
|
|
|
|
|
|
|
|
District of Columbia (Sibley Memorial Hospital);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009, Hospital RB
|
|
|
6.50
|
%
|
|
|
10/01/29
|
|
|
|
290
|
|
|
|
341,084
|
|
|
Series 2009, Hospital RB
|
|
|
6.38
|
%
|
|
|
10/01/34
|
|
|
|
900
|
|
|
|
1,035,819
|
|
|
District of Columbia Water & Sewer Authority;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 A, Ref. Public Utility Sub. Lien RB
(INSAGC)
(a)(b)
|
|
|
5.00
|
%
|
|
|
10/01/29
|
|
|
|
275
|
|
|
|
310,723
|
|
|
Series 2008 A, Ref. Public Utility Sub. Lien RB
(INSAGC)
(a)(b)
|
|
|
5.00
|
%
|
|
|
10/01/34
|
|
|
|
550
|
|
|
|
609,582
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,297,208
|
|
|
Florida6.55%
|
|
|
|
|
|
|
|
|
|
|
|
|
Brevard (County of) Health Facilities Authority (Buena Vida
Estates, Inc.); Series 2008, Residential Care Facility RB
|
|
|
6.75
|
%
|
|
|
01/01/37
|
|
|
|
625
|
|
|
|
515,812
|
|
|
Citizens Property Insurance Corp. (High Risk Account);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2010
A-1,
Sr.
Sec. RB
|
|
|
5.00
|
%
|
|
|
06/01/14
|
|
|
|
1,000
|
|
|
|
1,086,960
|
|
|
Series 2010
A-1,
Sr.
Sec. RB
|
|
|
5.25
|
%
|
|
|
06/01/17
|
|
|
|
880
|
|
|
|
1,010,557
|
|
|
Escambia (County of) Health Facilities Authority (Florida Health
Care Facility Loan Veterans Health Administration Program);
Series 2000, RB
(INSAMBAC)
(a)
|
|
|
5.95
|
%
|
|
|
07/01/20
|
|
|
|
95
|
|
|
|
99,306
|
|
|
Florida (State of) Ports Financing Commission (State
Transportation Trust Fund); Series 2011 B,
Ref. RB
(c)
|
|
|
5.13
|
%
|
|
|
06/01/27
|
|
|
|
600
|
|
|
|
678,258
|
|
|
Hillsborough (County of) Aviation Authority;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 A, RB
(INSAGC)
(a)(b)(c)
|
|
|
5.38
|
%
|
|
|
10/01/33
|
|
|
|
350
|
|
|
|
372,512
|
|
|
Series 2008 A, RB
(INSAGC)
(a)(b)(c)
|
|
|
5.50
|
%
|
|
|
10/01/38
|
|
|
|
775
|
|
|
|
821,678
|
|
|
Hillsborough (County of) Industrial Development Authority (Tampa
Electric Co.);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2006, Ref. PCR
(INSAMBAC)
(a)(d)(e)
|
|
|
5.00
|
%
|
|
|
03/15/12
|
|
|
|
300
|
|
|
|
300,576
|
|
|
Series 2007 B, Ref.
PCR
(d)(e)
|
|
|
5.15
|
%
|
|
|
09/01/13
|
|
|
|
300
|
|
|
|
319,188
|
|
|
Miami-Dade (County of) Expressway Authority;
Series 2010 A, Ref. Toll System RB
|
|
|
5.00
|
%
|
|
|
07/01/40
|
|
|
|
2,000
|
|
|
|
2,125,220
|
|
|
Miami-Dade (County of) Health Facilities Authority (Miami
Childrens Hospital); Series 2010 A, Ref.
Hospital RB
|
|
|
6.13
|
%
|
|
|
08/01/42
|
|
|
|
230
|
|
|
|
265,271
|
|
|
Overoaks Community Development District;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2004 A, Capital Improvement Special
Assessment RB
(k)
|
|
|
6.13
|
%
|
|
|
05/01/35
|
|
|
|
40
|
|
|
|
|
|
|
Series 2010
A-2,
Capital
Improvement Conv.
CAB RB
(f)
|
|
|
0.00
|
%
|
|
|
05/01/35
|
|
|
|
50
|
|
|
|
37,720
|
|
|
Series 2010 B, Capital Improvement Conv.
CAB RB
(f)
|
|
|
0.00
|
%
|
|
|
05/01/17
|
|
|
|
110
|
|
|
|
98,030
|
|
|
Palm Beach (County of) Health Facilities Authority (The
Waterford); Series 2007, RB
|
|
|
5.88
|
%
|
|
|
11/15/37
|
|
|
|
400
|
|
|
|
411,764
|
|
|
Palm Beach (County of) Solid Waste Authority;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009, Improvement RB
(INSBHAC)
(a)(b)
|
|
|
5.50
|
%
|
|
|
10/01/23
|
|
|
|
1,000
|
|
|
|
1,235,760
|
|
|
Series 2011,
Ref. RB
(b)
|
|
|
5.00
|
%
|
|
|
10/01/31
|
|
|
|
915
|
|
|
|
1,028,735
|
|
|
Putnam (County of) Development Authority (Seminole Electric
Cooperative); Series 2007 A, Ref. PCR
(INSAMBAC)
(a)(d)(e)
|
|
|
5.35
|
%
|
|
|
05/01/18
|
|
|
|
1,100
|
|
|
|
1,252,053
|
|
|
Seminole Indian Tribe of Florida; Series 2007 A,
Special
Obligation RB
(g)
|
|
|
5.75
|
%
|
|
|
10/01/22
|
|
|
|
250
|
|
|
|
263,135
|
|
|
Seven Oaks Community Development District II;
Series 2004 A, Special Assessment RB
|
|
|
5.88
|
%
|
|
|
05/01/35
|
|
|
|
330
|
|
|
|
245,414
|
|
|
Sterling Hill Community Development District;
Series 2003 A, Capital Improvement Special Assessment
RB
|
|
|
6.20
|
%
|
|
|
05/01/35
|
|
|
|
300
|
|
|
|
250,542
|
|
|
Tolomato Community Development District; Series 2007,
Special
Assessment RB
(k)
|
|
|
6.65
|
%
|
|
|
05/01/40
|
|
|
|
270
|
|
|
|
115,101
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,533,592
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
8 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Georgia3.91%
|
|
|
|
|
|
|
|
|
|
|
|
|
Atlanta (City of) (Beltline);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009 B, Tax Allocation RB
|
|
|
6.75
|
%
|
|
|
01/01/20
|
|
|
$
|
130
|
|
|
$
|
141,929
|
|
|
Series 2009 B, Tax Allocation RB
|
|
|
6.75
|
%
|
|
|
01/01/20
|
|
|
|
235
|
|
|
|
256,564
|
|
|
Series 2009 B, Tax Allocation RB
|
|
|
7.38
|
%
|
|
|
01/01/31
|
|
|
|
75
|
|
|
|
82,024
|
|
|
Atlanta (City of);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2004 C, Airport Passenger Facility
Charge & Sub. Lien General RB
(INSAGM)
(a)(b)
|
|
|
5.00
|
%
|
|
|
01/01/33
|
|
|
|
1,250
|
|
|
|
1,318,950
|
|
|
Series 2009 A, Water & Wastewater RB
|
|
|
5.25
|
%
|
|
|
11/01/17
|
|
|
|
1,675
|
|
|
|
2,029,497
|
|
|
Series 2009 A, Water & Wastewater RB
|
|
|
6.00
|
%
|
|
|
11/01/27
|
|
|
|
450
|
|
|
|
538,407
|
|
|
Series 2009 A, Water & Wastewater RB
|
|
|
6.00
|
%
|
|
|
11/01/28
|
|
|
|
500
|
|
|
|
595,485
|
|
|
Series 2009 A, Water & Wastewater RB
|
|
|
6.00
|
%
|
|
|
11/01/29
|
|
|
|
450
|
|
|
|
534,253
|
|
|
Private Colleges & Universities Authority (Emory
University);
Series 2009 B, RB
(b)
|
|
|
5.00
|
%
|
|
|
09/01/29
|
|
|
|
1,200
|
|
|
|
1,376,280
|
|
|
Putnam (County of) Development Authority (Georgia Power Co.);
First Series 1996, PCR
|
|
|
5.10
|
%
|
|
|
06/01/23
|
|
|
|
600
|
|
|
|
615,630
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,489,019
|
|
|
Hawaii1.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
Hawaii (State of) Department of Budget & Finance
(Hawaii Pacific Health Obligated Group);
Series 2010 B, Special Purpose RB
|
|
|
5.63
|
%
|
|
|
07/01/30
|
|
|
|
1,000
|
|
|
|
1,096,000
|
|
|
Hawaii (State of); Series 2010 A, Airport System RB
|
|
|
5.00
|
%
|
|
|
07/01/39
|
|
|
|
750
|
|
|
|
804,068
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,900,068
|
|
|
Idaho0.83%
|
|
|
|
|
|
|
|
|
|
|
|
|
Idaho (State of) Health Facilities Authority (St. Lukes
Health System);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 A, RB
|
|
|
6.50
|
%
|
|
|
11/01/23
|
|
|
|
250
|
|
|
|
298,585
|
|
|
Series 2008 A, RB
|
|
|
6.75
|
%
|
|
|
11/01/37
|
|
|
|
400
|
|
|
|
467,272
|
|
|
Idaho (State of) Health Facilities Authority (Valley Vista Care
Corp.); Series 2007, Ref. RB
|
|
|
6.13
|
%
|
|
|
11/15/27
|
|
|
|
305
|
|
|
|
294,389
|
|
|
Regents of the University of Idaho; Series 2011, Ref.
General RB
(d)(e)
|
|
|
5.25
|
%
|
|
|
04/01/21
|
|
|
|
445
|
|
|
|
533,920
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,594,166
|
|
|
Illinois18.63%
|
|
|
|
|
|
|
|
|
|
|
|
|
Bartlett (Village of) (Quarry Redevelopment); Series 2007,
Ref. Sr. Lien Tax Increment Allocation RB
|
|
|
5.60
|
%
|
|
|
01/01/23
|
|
|
|
500
|
|
|
|
460,940
|
|
|
Bourbonnais (Village of) (Olivet Nazarene University);
Series 2010, Industrial Project RB
|
|
|
5.50
|
%
|
|
|
11/01/40
|
|
|
|
270
|
|
|
|
283,063
|
|
|
Chicago (City of) (OHare International Airport);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2001 A, Second Lien Passenger Facility Charge
RB
(INSAMBAC)
(a)(c)
|
|
|
5.38
|
%
|
|
|
01/01/32
|
|
|
|
2,540
|
|
|
|
2,543,327
|
|
|
Series 2002 A, Ref. Third Lien General Airport RB
(INSNATL)
(a)(c)
|
|
|
5.38
|
%
|
|
|
01/01/32
|
|
|
|
2,000
|
|
|
|
2,002,620
|
|
|
Series 2008 A, Third Lien General Airport RB
(INSAGM)
(a)(b)
|
|
|
5.00
|
%
|
|
|
01/01/33
|
|
|
|
1,400
|
|
|
|
1,489,796
|
|
|
Chicago (City of) Board of Education;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 C, Ref. Unlimited Tax GO Bonds
(INSAGM)
(a)
|
|
|
5.00
|
%
|
|
|
12/01/27
|
|
|
|
2,750
|
|
|
|
3,002,505
|
|
|
Series 2011 A, Unlimited Tax GO
Bonds
(b)
|
|
|
5.00
|
%
|
|
|
12/01/41
|
|
|
|
445
|
|
|
|
480,814
|
|
|
Chicago (City of) Transit Authority; Series 2011, Sales Tax
Receipts RB
(b)
|
|
|
5.25
|
%
|
|
|
12/01/36
|
|
|
|
1,365
|
|
|
|
1,522,057
|
|
|
Chicago (City of);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 A, Unlimited Tax GO Bonds
(INSAGC)
(a)(b)
|
|
|
5.25
|
%
|
|
|
01/01/25
|
|
|
|
1,425
|
|
|
|
1,593,478
|
|
|
Series 2011, COP
|
|
|
7.13
|
%
|
|
|
05/01/21
|
|
|
|
225
|
|
|
|
241,893
|
|
|
Series 2011, COP
|
|
|
7.13
|
%
|
|
|
05/01/21
|
|
|
|
150
|
|
|
|
161,262
|
|
|
Series 2011 A, Sales
Tax RB
(b)
|
|
|
5.25
|
%
|
|
|
01/01/38
|
|
|
|
690
|
|
|
|
774,773
|
|
|
Cook County School District No. 100 (Berwyn South);
Series 1997, Unlimited Tax GO Bonds
(INSAGM)
(a)
|
|
|
8.10
|
%
|
|
|
12/01/15
|
|
|
|
285
|
|
|
|
348,336
|
|
|
Granite City (City of) (Waste Management, Inc.);
Series 2002, Solid Waste
Disposal RB
(c)(d)(e)
|
|
|
3.50
|
%
|
|
|
05/01/13
|
|
|
|
300
|
|
|
|
308,787
|
|
|
Illinois (State of) Finance Authority (Elmhurst Memorial
Healthcare); Series 2008 B, VRD RB (LOCJPMorgan
Chase
Bank, N.A.)
(i)(j)
|
|
|
0.10
|
%
|
|
|
01/01/48
|
|
|
|
2,100
|
|
|
|
2,100,000
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
9 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Illinois(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Illinois (State of) Finance Authority (Kish Health System
Obligated Group); Series 2008, Ref. Hospital RB
|
|
|
5.50
|
%
|
|
|
10/01/22
|
|
|
$
|
750
|
|
|
$
|
832,530
|
|
|
Illinois (State of) Finance Authority (Northwestern Memorial
Hospital);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009 A, RB
(b)
|
|
|
5.38
|
%
|
|
|
08/15/24
|
|
|
|
870
|
|
|
|
1,021,493
|
|
|
Series 2009 A, RB
(b)
|
|
|
5.75
|
%
|
|
|
08/15/30
|
|
|
|
500
|
|
|
|
576,675
|
|
|
Illinois (State of) Finance Authority (OSF Healthcare System);
Series 2007 A, RB
|
|
|
5.75
|
%
|
|
|
11/15/37
|
|
|
|
2,000
|
|
|
|
2,153,200
|
|
|
Illinois (State of) Finance Authority (Park Place of Elmhurst);
Series 2010 D-2,
TEMPS-65
sm
RB
|
|
|
7.00
|
%
|
|
|
11/15/15
|
|
|
|
600
|
|
|
|
600,270
|
|
|
Illinois (State of) Finance Authority (Resurrection Health
Care); Series 1999 A, RB
(INSAGM)
(a)
|
|
|
5.50
|
%
|
|
|
05/15/24
|
|
|
|
3,000
|
|
|
|
3,266,460
|
|
|
Illinois (State of) Finance Authority (Riverside Health System);
Series 2009, RB
|
|
|
6.25
|
%
|
|
|
11/15/35
|
|
|
|
500
|
|
|
|
561,805
|
|
|
Illinois (State of) Finance Authority (Rush University Medical
Center Obligated Group); Series 2009 A, RB
|
|
|
7.25
|
%
|
|
|
11/01/38
|
|
|
|
750
|
|
|
|
916,267
|
|
|
Illinois (State of) Finance Authority (Sherman Health System);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 1997, RB
(INSAMBAC)
(a)
|
|
|
5.25
|
%
|
|
|
08/01/22
|
|
|
|
1,185
|
|
|
|
1,186,813
|
|
|
Series 2007 A, RB
|
|
|
5.50
|
%
|
|
|
08/01/37
|
|
|
|
1,000
|
|
|
|
1,016,570
|
|
|
Illinois (State of) Finance Authority (Swedish American
Hospital); Series 2004, RB
(INSAMBAC)
(a)
|
|
|
5.00
|
%
|
|
|
11/15/31
|
|
|
|
620
|
|
|
|
624,247
|
|
|
Illinois (State of) Finance Authority (Swedish Covenant
Hospital); Series 2010 A, Ref. RB
|
|
|
6.00
|
%
|
|
|
08/15/38
|
|
|
|
550
|
|
|
|
604,489
|
|
|
Illinois (State of) Finance Authority (The University of Chicago
Medical Center);
Series 2011 C, RB
(b)
|
|
|
5.50
|
%
|
|
|
08/15/41
|
|
|
|
855
|
|
|
|
946,365
|
|
|
Illinois (State of) Finance Authority (Waste Management Inc.);
Series 2005 A, Solid Waste
Disposal RB
(c)
|
|
|
5.05
|
%
|
|
|
08/01/29
|
|
|
|
1,335
|
|
|
|
1,352,942
|
|
|
Peoria (County of); Series 2011, Unlimited Tax GO
Bonds
(b)
|
|
|
5.00
|
%
|
|
|
12/15/41
|
|
|
|
1,050
|
|
|
|
1,125,936
|
|
|
Railsplitter Tobacco Settlement Authority; Series 2010, RB
|
|
|
5.50
|
%
|
|
|
06/01/23
|
|
|
|
1,175
|
|
|
|
1,355,844
|
|
|
Will (County of) & Kankakee (City of) Regional Development
Authority (Senior Estates Supportive Living); Series 2007,
MFH RB
(c)
|
|
|
7.00
|
%
|
|
|
12/01/42
|
|
|
|
220
|
|
|
|
220,618
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
35,676,175
|
|
|
Indiana4.58%
|
|
|
|
|
|
|
|
|
|
|
|
|
Crown Point (City of) (Wittenberg Village); Series 2009
C-1,
TEMPS-80
sm
Economic Development RB
|
|
|
7.25
|
%
|
|
|
11/15/14
|
|
|
|
75
|
|
|
|
75,135
|
|
|
East Chicago Elementary School Building Corp.; Series 1996,
Ref. First Mortgage RB
(INSAMBAC)
(a)
|
|
|
6.25
|
%
|
|
|
01/05/16
|
|
|
|
2,105
|
|
|
|
2,279,189
|
|
|
Indiana (State of) Finance Authority (Ascension Health Senior
Credit); Series 2006
B-6, RB
(b)
|
|
|
5.00
|
%
|
|
|
11/15/36
|
|
|
|
4,600
|
|
|
|
4,810,542
|
|
|
Indiana (State of) Finance Authority (CWA Authority);
Series 2011 B, Second Lien Wastewater Utility RB
|
|
|
5.25
|
%
|
|
|
10/01/31
|
|
|
|
835
|
|
|
|
936,143
|
|
|
Indiana (State of) Finance Authority (Indianapolis
Power & Light Co.); Series 2009 A, Ref.
Environmental Facilities RB
|
|
|
4.90
|
%
|
|
|
01/01/16
|
|
|
|
600
|
|
|
|
662,922
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,763,931
|
|
|
Iowa1.43%
|
|
|
|
|
|
|
|
|
|
|
|
|
Coralville (City of); Series 2006 D, COP
|
|
|
5.25
|
%
|
|
|
06/01/26
|
|
|
|
1,125
|
|
|
|
1,207,901
|
|
|
Des Moines (City of); Series 2000 A, Public Parking
System RB
(INSNATL)
(a)
|
|
|
5.75
|
%
|
|
|
06/01/14
|
|
|
|
1,515
|
|
|
|
1,521,181
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,729,082
|
|
|
Kansas3.31%
|
|
|
|
|
|
|
|
|
|
|
|
|
Cowley County Unified School District No. 465 (Winfield);
Series 2003, Unlimited Tax GO Bonds
(INSNATL)
(a)
|
|
|
5.25
|
%
|
|
|
10/01/21
|
|
|
|
70
|
|
|
|
73,748
|
|
|
Kansas (State of) Development Finance Authority (Adventist
Health System/Sunbelt Obligated Group);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009 C, Hospital RB
|
|
|
5.50
|
%
|
|
|
11/15/23
|
|
|
|
1,250
|
|
|
|
1,496,450
|
|
|
Series 2009 C,
Hospital RB
(b)
|
|
|
5.75
|
%
|
|
|
11/15/38
|
|
|
|
1,000
|
|
|
|
1,143,950
|
|
|
Wamego (City of) (Kansas Gas & Electric Co.);
Series 2004, Ref. PCR
(INSNATL)
(a)
|
|
|
5.30
|
%
|
|
|
06/01/31
|
|
|
|
3,500
|
|
|
|
3,622,430
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,336,578
|
|
|
Kentucky2.50%
|
|
|
|
|
|
|
|
|
|
|
|
|
Kentucky (State of) Economic Development Finance Authority
(Louisville Arena Authority, Inc.); Subseries 2008
A-1,
RB
(INSAGC)
(a)
|
|
|
5.75
|
%
|
|
|
12/01/28
|
|
|
|
600
|
|
|
|
668,976
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
10 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Kentucky(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kentucky (State of) Economic Development Finance Authority
(Owensboro Medical Health System, Inc.);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2010 A, Hospital RB
|
|
|
6.38
|
%
|
|
|
06/01/40
|
|
|
$
|
475
|
|
|
$
|
533,890
|
|
|
Series 2010 A, Hospital RB
|
|
|
6.50
|
%
|
|
|
03/01/45
|
|
|
|
600
|
|
|
|
679,500
|
|
|
Kentucky (State of) Property & Building Commission
(No. 93);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009, Ref. RB
(INSAGC)
(a)
|
|
|
5.25
|
%
|
|
|
02/01/24
|
|
|
|
600
|
|
|
|
699,336
|
|
|
Series 2009, Ref. RB
(INSAGC)
(a)
|
|
|
5.25
|
%
|
|
|
02/01/25
|
|
|
|
660
|
|
|
|
764,742
|
|
|
Louisville (City of) & Jefferson (County of) Metropolitan
Government (Norton Healthcare, Inc.); Series 2006, Health
System RB
|
|
|
5.25
|
%
|
|
|
10/01/36
|
|
|
|
1,405
|
|
|
|
1,449,075
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,795,519
|
|
|
Louisiana1.67%
|
|
|
|
|
|
|
|
|
|
|
|
|
Lakeshore Villages Master Community Development District;
Series 2007, Special
Assessment RB
(k)
|
|
|
5.25
|
%
|
|
|
07/01/17
|
|
|
|
371
|
|
|
|
148,378
|
|
|
Louisiana (State of) Public Facilities Authority (Entergy
Louisiana LLC); Series 2010, RB
|
|
|
5.00
|
%
|
|
|
06/01/30
|
|
|
|
400
|
|
|
|
418,556
|
|
|
Louisiana Citizens Property Insurance Corp.; Series 2009
C-2, Assessment RB
(INSAGC)
(a)
|
|
|
6.75
|
%
|
|
|
06/01/26
|
|
|
|
750
|
|
|
|
900,705
|
|
|
Rapides (Parish of) Finance Authority (Cleco Power LLC);
Series 2007, RB
(c)(d)(e)
|
|
|
5.25
|
%
|
|
|
03/01/13
|
|
|
|
750
|
|
|
|
774,983
|
|
|
St. John the Baptist (Parish of) (Marathon Oil Corp.);
Series 2007 A, RB
|
|
|
5.13
|
%
|
|
|
06/01/37
|
|
|
|
925
|
|
|
|
959,132
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,201,754
|
|
|
Maryland1.57%
|
|
|
|
|
|
|
|
|
|
|
|
|
Maryland (State of) Health & Higher Educational
Facilities Authority (Maryland Institute College of Art);
Series 2006, RB
|
|
|
5.00
|
%
|
|
|
06/01/40
|
|
|
|
770
|
|
|
|
782,921
|
|
|
Maryland (State of) Health & Higher Educational
Facilities Authority (Mercy Medical Center);
Series 2007 A, RB
|
|
|
5.50
|
%
|
|
|
07/01/42
|
|
|
|
800
|
|
|
|
812,304
|
|
|
Maryland Economic Development Corp. (Collegiate Housing
Salisbury); Series 1999 A, Student Housing RB
|
|
|
6.00
|
%
|
|
|
06/01/19
|
|
|
|
735
|
|
|
|
735,000
|
|
|
Maryland Economic Development Corp. (Terminal);
Series 2010 B, RB
|
|
|
5.75
|
%
|
|
|
06/01/35
|
|
|
|
375
|
|
|
|
397,102
|
|
|
Maryland Economic Development Corp. (Transportation Facilities);
Series 2010 A, RB
|
|
|
5.38
|
%
|
|
|
06/01/25
|
|
|
|
265
|
|
|
|
275,338
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,002,665
|
|
|
Massachusetts4.45%
|
|
|
|
|
|
|
|
|
|
|
|
|
Massachusetts (State of) Department of Transportation (Contract
Assistance); Series 2010 B, Metropolitan Highway
Systems RB
|
|
|
5.00
|
%
|
|
|
01/01/35
|
|
|
|
2,010
|
|
|
|
2,237,632
|
|
|
Massachusetts (State of) Development Finance Agency (American
Hingham); Series 1995, Water
Treatment RB
(c)
|
|
|
6.75
|
%
|
|
|
12/01/20
|
|
|
|
1,145
|
|
|
|
1,146,397
|
|
|
Massachusetts (State of) Development Finance Agency (Berklee
College of Music); Series 2007 A, RB
|
|
|
5.00
|
%
|
|
|
10/01/32
|
|
|
|
650
|
|
|
|
698,913
|
|
|
Massachusetts (State of) Development Finance Agency (Linden
Ponds, Inc. Facility);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2011
A-1,
RB
|
|
|
6.25
|
%
|
|
|
11/15/46
|
|
|
|
160
|
|
|
|
114,829
|
|
|
Series 2011
A-2,
RB
|
|
|
5.50
|
%
|
|
|
11/15/46
|
|
|
|
8
|
|
|
|
5,206
|
|
|
Series 2011 B,
CAB RB
(f)
|
|
|
0.00
|
%
|
|
|
11/15/56
|
|
|
|
42
|
|
|
|
223
|
|
|
Massachusetts (State of) Development Finance Agency (SEMASS
System); Series 2001 A, Resource Recovery RB
(INSNATL)
(a)
|
|
|
5.63
|
%
|
|
|
01/01/15
|
|
|
|
2,000
|
|
|
|
2,024,860
|
|
|
Massachusetts (State of) Development Finance Agency (The Groves
in Lincoln); Series 2009 B-2, Senior Living Facility RB
|
|
|
6.25
|
%
|
|
|
06/01/14
|
|
|
|
240
|
|
|
|
240,007
|
|
|
Massachusetts (State of) Development Finance Agency (Tufts
Medical Center); Series 2011 I, RB
|
|
|
7.25
|
%
|
|
|
01/01/32
|
|
|
|
300
|
|
|
|
358,023
|
|
|
Massachusetts (State of) School Building Authority;
Series 2011 B, Sr. Dedicated Sales
Tax RB
(b)
|
|
|
5.00
|
%
|
|
|
10/15/35
|
|
|
|
1,485
|
|
|
|
1,701,617
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,527,707
|
|
|
Michigan0.83%
|
|
|
|
|
|
|
|
|
|
|
|
|
Detroit (City of); Series 2001 C-1, Ref. Sr. Lien Sewage
Disposal System RB
(INSAGM)
(a)
|
|
|
7.00
|
%
|
|
|
07/01/27
|
|
|
|
800
|
|
|
|
988,248
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
11 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Michigan(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kent (County of) Hospital Finance Authority (Spectrum Health
System);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 A, RB
(d)(e)
|
|
|
5.25
|
%
|
|
|
01/15/14
|
|
|
$
|
325
|
|
|
$
|
351,459
|
|
|
Series 2008 A, RB
(d)(e)
|
|
|
5.50
|
%
|
|
|
01/15/15
|
|
|
|
225
|
|
|
|
253,991
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,593,698
|
|
|
Minnesota0.68%
|
|
|
|
|
|
|
|
|
|
|
|
|
Minneapolis (City of) (Fairview Health Services);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 A, Health Care System RB
|
|
|
6.38
|
%
|
|
|
11/15/23
|
|
|
|
650
|
|
|
|
773,754
|
|
|
Series 2008 A, Health Care System RB
|
|
|
6.63
|
%
|
|
|
11/15/28
|
|
|
|
450
|
|
|
|
530,928
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,304,682
|
|
|
Mississippi1.04%
|
|
|
|
|
|
|
|
|
|
|
|
|
Mississippi Business Finance Corp. (Chevron U.S.A. Inc.);
Series 2009 A, VRD Gulf Opportunity Zone
IDR
(i)
|
|
|
0.14
|
%
|
|
|
12/01/30
|
|
|
|
2,000
|
|
|
|
2,000,000
|
|
|
Missouri3.05%
|
|
|
|
|
|
|
|
|
|
|
|
|
Cape Girardeau (County of) Industrial Development Authority
(Southeast Missouri Hospital Association); Series 2002,
Health Facilities RB
|
|
|
5.63
|
%
|
|
|
06/01/27
|
|
|
|
205
|
|
|
|
205,590
|
|
|
Cape Girardeau (County of) Industrial Development Authority (St.
Francis Medical Center); Series 2009 A, Health
Facilities RB
|
|
|
5.50
|
%
|
|
|
06/01/29
|
|
|
|
500
|
|
|
|
546,300
|
|
|
Cass (County of); Series 2007, Hospital RB
|
|
|
5.63
|
%
|
|
|
05/01/38
|
|
|
|
500
|
|
|
|
503,115
|
|
|
Kansas City (City of) Industrial Development Authority (Downtown
Redevelopment District);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2011 A, Ref. RB
|
|
|
5.50
|
%
|
|
|
09/01/27
|
|
|
|
275
|
|
|
|
322,671
|
|
|
Series 2011 A, Ref. RB
|
|
|
5.50
|
%
|
|
|
09/01/28
|
|
|
|
550
|
|
|
|
642,417
|
|
|
Kirkwood (City of) Industrial Development Authority (Aberdeen
Heights); Series 2010 C-1,
TEMPS-75
sm
Retirement Community RB
|
|
|
7.50
|
%
|
|
|
11/15/16
|
|
|
|
650
|
|
|
|
658,138
|
|
|
Missouri (State of) Health & Educational Facilities
Authority (Lutheran Senior Services);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2005 A, Senior Living Facilities RB
|
|
|
5.38
|
%
|
|
|
02/01/35
|
|
|
|
1,000
|
|
|
|
1,007,470
|
|
|
Series 2010, Senior Living Facilities RB
|
|
|
5.50
|
%
|
|
|
02/01/42
|
|
|
|
375
|
|
|
|
381,848
|
|
|
St. Charles (City of); Series 2003 B,
COP
(d)(h)
|
|
|
5.50
|
%
|
|
|
05/01/13
|
|
|
|
1,250
|
|
|
|
1,325,925
|
|
|
St. Louis (City of) Industrial Development Authority
(Loughborough Commons Redevelopment); Series 2007, Ref.
Community Improvement District Tax Increment Allocation RB
|
|
|
5.75
|
%
|
|
|
11/01/27
|
|
|
|
250
|
|
|
|
246,175
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,839,649
|
|
|
Nebraska1.38%
|
|
|
|
|
|
|
|
|
|
|
|
|
Nebraska (State of) Municipal Energy Agency;
Series 2009 A, Ref. Power Supply System RB
(INSBHAC)
(a)
|
|
|
5.38
|
%
|
|
|
04/01/39
|
|
|
|
1,000
|
|
|
|
1,134,570
|
|
|
Omaha (City of) Public Power District;
Series 2011 B, RB
(b)
|
|
|
5.00
|
%
|
|
|
02/01/36
|
|
|
|
1,335
|
|
|
|
1,514,104
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,648,674
|
|
|
Nevada0.52%
|
|
|
|
|
|
|
|
|
|
|
|
|
Clark (County of) (Southwest Gas Corp.);
Series 2004 A, IDR
(INSAMBAC)
(a)(c)
|
|
|
5.25
|
%
|
|
|
07/01/34
|
|
|
|
1,000
|
|
|
|
1,003,700
|
|
|
New Jersey0.34%
|
|
|
|
|
|
|
|
|
|
|
|
|
New Jersey (State of) Economic Development Authority (Provident
Group-Montclair Properties LLC-Montclair State University
Student Housing); Series 2010 A, RB
|
|
|
5.88
|
%
|
|
|
06/01/42
|
|
|
|
600
|
|
|
|
646,452
|
|
|
New Mexico2.50%
|
|
|
|
|
|
|
|
|
|
|
|
|
Farmington (City of) (Public Service Co. of New Mexico San Juan);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2010 A, Ref.
PCR
(d)(e)
|
|
|
5.20
|
%
|
|
|
06/01/20
|
|
|
|
500
|
|
|
|
531,745
|
|
|
Series 2010 C, Ref. PCR
|
|
|
5.90
|
%
|
|
|
06/01/40
|
|
|
|
750
|
|
|
|
785,573
|
|
|
Jicarilla Apache Nation;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2003 A, RB
(g)
|
|
|
5.00
|
%
|
|
|
09/01/18
|
|
|
|
1,500
|
|
|
|
1,582,080
|
|
|
Series 2003 A, RB
(g)
|
|
|
5.50
|
%
|
|
|
09/01/23
|
|
|
|
1,250
|
|
|
|
1,308,975
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
12 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
New Mexico(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
New Mexico (State of) Hospital Equipment Loan Council
(Presbyterian Health Care Services); Series 2008 A,
Hospital RB
(b)
|
|
|
6.38
|
%
|
|
|
08/01/32
|
|
|
$
|
500
|
|
|
$
|
585,315
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,793,688
|
|
|
New York16.18%
|
|
|
|
|
|
|
|
|
|
|
|
|
Brooklyn Arena Local Development Corp. (Barclays Center);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009, PILOT RB
|
|
|
6.25
|
%
|
|
|
07/15/40
|
|
|
|
500
|
|
|
|
540,250
|
|
|
Series 2009, PILOT RB
|
|
|
6.38
|
%
|
|
|
07/15/43
|
|
|
|
210
|
|
|
|
227,462
|
|
|
Nassau (County of) Industrial Development Agency (Amsterdam at
Harborside);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2007 A, Continuing Care Retirement Community RB
|
|
|
6.50
|
%
|
|
|
01/01/27
|
|
|
|
2,000
|
|
|
|
1,686,720
|
|
|
Series 2007 A, Continuing Care Retirement Community RB
|
|
|
6.70
|
%
|
|
|
01/01/43
|
|
|
|
2,750
|
|
|
|
2,157,155
|
|
|
New York & New Jersey (States of) Port Authority (JFK
International Air Terminal LLC); Series 2010 8, Special
Obligation RB
|
|
|
6.00
|
%
|
|
|
12/01/36
|
|
|
|
750
|
|
|
|
842,152
|
|
|
New York & New Jersey (States of) Port Authority;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
One Hundred Fifty-Second Series 2008,
Consolidated RB
(b)(c)
|
|
|
5.00
|
%
|
|
|
11/01/28
|
|
|
|
6,300
|
|
|
|
6,958,161
|
|
|
One Hundred Forty-Fourth Series 2006,
Consolidated RB
(b)
|
|
|
5.00
|
%
|
|
|
10/01/35
|
|
|
|
6,900
|
|
|
|
7,818,390
|
|
|
New York (City of) Municipal Water Finance Authority;
Series 2010 FF, Second General Resolution Water &
Sewer System RB
|
|
|
5.00
|
%
|
|
|
06/15/31
|
|
|
|
2,400
|
|
|
|
2,743,416
|
|
|
New York (City of);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 1995 C, Unlimited Tax GO Bonds
|
|
|
7.25
|
%
|
|
|
08/15/24
|
|
|
|
5
|
|
|
|
5,027
|
|
|
Subseries 2008 I-1, Unlimited Tax GO
Bonds
(b)
|
|
|
5.00
|
%
|
|
|
02/01/26
|
|
|
|
1,700
|
|
|
|
1,927,868
|
|
|
New York (State of) Dormitory Authority (General Purpose);
Series 2011 A, State Personal Income
Tax RB
(b)
|
|
|
5.00
|
%
|
|
|
03/15/30
|
|
|
|
810
|
|
|
|
943,407
|
|
|
New York (State of) Thruway Authority (Transportation);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009 A, Personal Income
Tax RB
(b)
|
|
|
5.00
|
%
|
|
|
03/15/26
|
|
|
|
700
|
|
|
|
818,440
|
|
|
Series 2009 A, Personal Income
Tax RB
(b)
|
|
|
5.00
|
%
|
|
|
03/15/27
|
|
|
|
750
|
|
|
|
873,308
|
|
|
Series 2009 A, Personal Income
Tax RB
(b)
|
|
|
5.00
|
%
|
|
|
03/15/28
|
|
|
|
1,600
|
|
|
|
1,858,560
|
|
|
New York (State of) Thruway Authority; Series 2011
A-1,
Second
General Highway & Bridge
Trust Fund RB
(b)
|
|
|
5.00
|
%
|
|
|
04/01/29
|
|
|
|
1,350
|
|
|
|
1,573,061
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,973,377
|
|
|
North Carolina2.36%
|
|
|
|
|
|
|
|
|
|
|
|
|
Charlotte (City of) (Convention Facility);
Series 2003 A, Ref. COP
|
|
|
5.50
|
%
|
|
|
08/01/19
|
|
|
|
3,000
|
|
|
|
3,217,410
|
|
|
North Carolina (State of) Medical Care Commission
(Southminster); Series 2007 A, First Mortgage
Retirement Facilities RB
|
|
|
5.75
|
%
|
|
|
10/01/37
|
|
|
|
150
|
|
|
|
133,496
|
|
|
North Carolina (State of) Turnpike Authority; Series 2011,
Monroe Connector System State
Appropriation RB
(b)
|
|
|
5.00
|
%
|
|
|
07/01/36
|
|
|
|
1,035
|
|
|
|
1,168,722
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,519,628
|
|
|
North Dakota0.28%
|
|
|
|
|
|
|
|
|
|
|
|
|
McLean (County of) (Great River Energy);
Series 2010 B, Solid Waste Facilities RB
|
|
|
5.15
|
%
|
|
|
07/01/40
|
|
|
|
500
|
|
|
|
538,385
|
|
|
Ohio8.09%
|
|
|
|
|
|
|
|
|
|
|
|
|
Cuyahoga (County of) (Cleveland Clinic Health System Obligated
Group); Series 2004 B1,
VRD RB
(i)
|
|
|
0.12
|
%
|
|
|
01/01/39
|
|
|
|
1,700
|
|
|
|
1,700,000
|
|
|
Franklin (County of) (Ohio Health Corp.);
Series 2011 A, Hospital
Facilities RB
(b)
|
|
|
5.00
|
%
|
|
|
11/15/36
|
|
|
|
885
|
|
|
|
949,322
|
|
|
Hancock (County of) (Blanchard Valley Regional Health Center);
Series 2011 A, Hospital Facilities RB
|
|
|
6.25
|
%
|
|
|
12/01/34
|
|
|
|
300
|
|
|
|
344,874
|
|
|
Lorain (County of) (Catholic Healthcare Partners);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2003 C-1, Ref. Hospital Facilities RB
(INSAGM)
(a)(b)
|
|
|
5.00
|
%
|
|
|
04/01/24
|
|
|
|
1,125
|
|
|
|
1,247,411
|
|
|
Series 2006 A, Hospital Facilities RB
(INSAGM)
(a)(b)
|
|
|
5.00
|
%
|
|
|
02/01/24
|
|
|
|
1,050
|
|
|
|
1,164,702
|
|
|
Series 2006 B, Hospital Facilities RB
(INSAGM)
(a)(b)
|
|
|
5.00
|
%
|
|
|
02/01/24
|
|
|
|
1,050
|
|
|
|
1,164,744
|
|
|
Montgomery (County of) (Miami Valley Hospital);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009 A, RB
|
|
|
6.00
|
%
|
|
|
11/15/28
|
|
|
|
565
|
|
|
|
604,296
|
|
|
Series 2009 A, RB
|
|
|
6.25
|
%
|
|
|
11/15/39
|
|
|
|
350
|
|
|
|
372,474
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
13 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Ohio(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ohio (State of) Air Quality Development Authority (Columbus
Southern Power Co.); Series 2009 B,
Ref. RB
(e)
|
|
|
5.80
|
%
|
|
|
12/01/38
|
|
|
$
|
1,000
|
|
|
$
|
1,117,170
|
|
|
Ohio (State of) Air Quality Development Authority (FirstEnergy
Generation Corp.); Series 2009 C, Ref. PCR
|
|
|
5.63
|
%
|
|
|
06/01/18
|
|
|
|
1,500
|
|
|
|
1,720,125
|
|
|
Ohio (State of) Higher Educational Facility Commission (Summa
Health System); Series 2010, Hospital Facilities RB
|
|
|
5.75
|
%
|
|
|
11/15/35
|
|
|
|
575
|
|
|
|
622,000
|
|
|
Ohio (State of) Higher Educational Facility Commission
(University Hospitals Health System, Inc.);
Series 2009 A, Hospital RB
|
|
|
6.75
|
%
|
|
|
01/15/39
|
|
|
|
850
|
|
|
|
905,394
|
|
|
Ohio (State of) Water Development Authority (Firstenergy
Generation Corp.); Series 2006 A, VRD RB (LOCUBS
AG)
(i)(j)
|
|
|
0.13
|
%
|
|
|
05/15/19
|
|
|
|
3,000
|
|
|
|
3,000,000
|
|
|
Ohio (State of) Water Development Authority (FirstEnergy Nuclear
Generation Corp.); Series 2009 A, Ref.
PCR
(d)(e)
|
|
|
5.88
|
%
|
|
|
06/01/16
|
|
|
|
500
|
|
|
|
569,525
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,482,037
|
|
|
Oklahoma0.25%
|
|
|
|
|
|
|
|
|
|
|
|
|
McAlester (City of) Public Works Authority; Series 2002,
Utility System CAB RB
(INSAGM)
(a)(f)
|
|
|
0.00
|
%
|
|
|
02/01/31
|
|
|
|
1,000
|
|
|
|
484,630
|
|
|
Pennsylvania1.43%
|
|
|
|
|
|
|
|
|
|
|
|
|
Delaware River Port Authority; Series 2010 D, RB
|
|
|
5.00
|
%
|
|
|
01/01/35
|
|
|
|
500
|
|
|
|
536,990
|
|
|
Franklin (County of) Industrial Development Authority
(Chambersburg Hospital); Series 2010, RB
|
|
|
5.38
|
%
|
|
|
07/01/42
|
|
|
|
900
|
|
|
|
946,206
|
|
|
Pennsylvania (State of) Turnpike Commission;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Subseries 2010 B-2, Sub. Conv.
CAB RB
(f)
|
|
|
0.00
|
%
|
|
|
12/01/28
|
|
|
|
850
|
|
|
|
805,052
|
|
|
Subseries 2010 B-2, Sub. Conv.
CAB RB
(f)
|
|
|
0.00
|
%
|
|
|
12/01/34
|
|
|
|
500
|
|
|
|
459,320
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,747,568
|
|
|
Puerto Rico4.09%
|
|
|
|
|
|
|
|
|
|
|
|
|
Puerto Rico (Commonwealth of) Aqueduct & Sewer
Authority;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2012 A, Sr. Lien RB
|
|
|
5.00
|
%
|
|
|
07/01/33
|
|
|
|
655
|
|
|
|
656,317
|
|
|
Series 2012 A, Sr. Lien RB
|
|
|
5.25
|
%
|
|
|
07/01/42
|
|
|
|
450
|
|
|
|
450,644
|
|
|
Series 2012 A, Sr. Lien RB
|
|
|
6.00
|
%
|
|
|
07/01/47
|
|
|
|
360
|
|
|
|
388,307
|
|
|
Puerto Rico (Commonwealth of) Electric Power Authority;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2010 CCC, RB
|
|
|
5.25
|
%
|
|
|
07/01/27
|
|
|
|
1,100
|
|
|
|
1,219,240
|
|
|
Series 2010 XX, RB
|
|
|
5.25
|
%
|
|
|
07/01/40
|
|
|
|
800
|
|
|
|
841,000
|
|
|
Puerto Rico Sales Tax Financing Corp.;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
First Subseries 2010 A, RB
|
|
|
5.38
|
%
|
|
|
08/01/39
|
|
|
|
750
|
|
|
|
811,732
|
|
|
First Subseries 2010 A, RB
|
|
|
5.50
|
%
|
|
|
08/01/42
|
|
|
|
850
|
|
|
|
926,474
|
|
|
First Subseries 2010 C, RB
|
|
|
5.25
|
%
|
|
|
08/01/41
|
|
|
|
2,350
|
|
|
|
2,531,208
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7,824,922
|
|
|
South Carolina9.24%
|
|
|
|
|
|
|
|
|
|
|
|
|
Beaufort (County of) (New River Redevelopment Area);
Series 2002, Tax Increment Allocation RB
(INSNATL)
(a)
|
|
|
5.50
|
%
|
|
|
06/01/20
|
|
|
|
2,420
|
|
|
|
2,491,995
|
|
|
Charleston Educational Excellence Finance Corp. (Charleston
County School District); Series 2005, Installment
Purchase RB
(b)
|
|
|
5.25
|
%
|
|
|
12/01/25
|
|
|
|
10,000
|
|
|
|
11,275,900
|
|
|
South Carolina (State of) Jobs-Economic Development Authority
(AnMed Health); Series 2009 B, Ref. & Improvement
Hospital RB
(INSAGC)
(a)
|
|
|
5.50
|
%
|
|
|
02/01/38
|
|
|
|
1,000
|
|
|
|
1,081,410
|
|
|
South Carolina (State of) Jobs-Economic Development Authority
(Electric & Gas Co.); Series 2002 A, IDR
(INSAMBAC)
(a)
|
|
|
5.20
|
%
|
|
|
11/01/27
|
|
|
|
1,500
|
|
|
|
1,536,375
|
|
|
South Carolina (State of) Jobs-Economic Development Authority
(The Woodlands at Furman);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2012, Ref. RB
|
|
|
6.00
|
%
|
|
|
11/15/47
|
|
|
|
178
|
|
|
|
95,332
|
|
|
Series 2012, Ref. Sub.
CAB RB
(f)
|
|
|
0.00
|
%
|
|
|
11/15/47
|
|
|
|
76
|
|
|
|
290
|
|
|
South Carolina (State of) Public Service Authority (Santee
Cooper); Series 2010 B,
Ref. RB
(b)
|
|
|
5.00
|
%
|
|
|
01/01/33
|
|
|
|
1,080
|
|
|
|
1,216,620
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,697,922
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
14 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Tennessee2.52%
|
|
|
|
|
|
|
|
|
|
|
|
|
Elizabethton (City of) Health & Educational Facilities
Board; Series 2000 B, Ref. & Improvement First
Mortgage
Hospital RB
(d)(h)
|
|
|
8.00
|
%
|
|
|
07/01/12
|
|
|
$
|
1,500
|
|
|
$
|
1,576,170
|
|
|
Johnson City (City of) Health & Educational Facilities
Board (Mountain States Health Alliance);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2000 A, Ref. First Mortgage
Hospital RB
(d)(h)
|
|
|
7.50
|
%
|
|
|
07/01/12
|
|
|
|
1,000
|
|
|
|
1,049,180
|
|
|
Series 2006 A, First Mortgage Hospital RB
|
|
|
5.50
|
%
|
|
|
07/01/36
|
|
|
|
750
|
|
|
|
779,363
|
|
|
Shelby (County of) Health, Educational & Housing
Facilities Board (Methodist Healthcare);
Series 2004 B, RB
(INSAGM)
(a)(b)
|
|
|
5.25
|
%
|
|
|
09/01/27
|
|
|
|
1,300
|
|
|
|
1,428,024
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,832,737
|
|
|
Texas15.73%
|
|
|
|
|
|
|
|
|
|
|
|
|
Alliance Airport Authority, Inc. (Federal Express Corp.);
Series 2006, Ref. Special
Facilities RB
(c)
|
|
|
4.85
|
%
|
|
|
04/01/21
|
|
|
|
575
|
|
|
|
616,595
|
|
|
Dallas (City of) (Civic Center Convention Complex);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009, Ref. & Improvement RB
(INSAGC)
(a)
|
|
|
5.00
|
%
|
|
|
08/15/18
|
|
|
|
500
|
|
|
|
585,300
|
|
|
Series 2009, Ref. & Improvement RB
(INSAGC)
(a)
|
|
|
5.00
|
%
|
|
|
08/15/19
|
|
|
|
575
|
|
|
|
676,568
|
|
|
Dallas-Fort Worth International Airport Facilities
Improvement Corp.;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2002 C, Joint Improvement RB
(INSNATL)
(a)(c)
|
|
|
5.75
|
%
|
|
|
11/01/18
|
|
|
|
190
|
|
|
|
190,709
|
|
|
Series 2002 C, Joint Improvement RB
(INSNATL)
(a)(c)
|
|
|
6.00
|
%
|
|
|
11/01/23
|
|
|
|
425
|
|
|
|
426,679
|
|
|
Series 2003 A, Joint RB
(INSAGM)
(a)(c)
|
|
|
5.50
|
%
|
|
|
11/01/21
|
|
|
|
2,000
|
|
|
|
2,094,460
|
|
|
El Paso (County of) Hospital District; Series 2008 A,
Limited Tax GO Bonds
(INSAGC)
(a)(b)
|
|
|
5.00
|
%
|
|
|
08/15/37
|
|
|
|
1,900
|
|
|
|
2,041,322
|
|
|
Harris (County of) Metropolitan Transit Authority;
Series 2011 A, Sales & Use
Tax RB
(b)
|
|
|
5.00
|
%
|
|
|
11/01/36
|
|
|
|
945
|
|
|
|
1,066,622
|
|
|
Harris (County of); Series 2009 A, Sr. Lien Toll
Road RB
(b)
|
|
|
5.00
|
%
|
|
|
08/15/28
|
|
|
|
1,500
|
|
|
|
1,737,750
|
|
|
Harris County Health Facilities Development Corp. (Memorial
Hermann Healthcare System); Series 2008 B, Ref. RB
|
|
|
7.25
|
%
|
|
|
12/01/35
|
|
|
|
300
|
|
|
|
359,058
|
|
|
Harris County Industrial Development Corp. (Deer Park Refining
Limited Partnership); Series 2006, Solid Waste Disposal RB
|
|
|
5.00
|
%
|
|
|
02/01/23
|
|
|
|
400
|
|
|
|
435,096
|
|
|
Houston (City of);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2007 A, Ref. First Lien Combined Utility System
RB
(INSAGM)
(a)(b)
|
|
|
5.00
|
%
|
|
|
11/15/36
|
|
|
|
3,000
|
|
|
|
3,239,820
|
|
|
Series 2011 D, First Lien Combined Utility
System RB
(b)
|
|
|
5.00
|
%
|
|
|
11/15/31
|
|
|
|
1,035
|
|
|
|
1,203,012
|
|
|
Judson Independent School District; Series 2008, School
Building Unlimited Tax GO Bonds
(INSAGC)
(a)(b)
|
|
|
5.00
|
%
|
|
|
02/01/37
|
|
|
|
1,200
|
|
|
|
1,267,644
|
|
|
Lower Colorado River Authority; Series 2010 A, Ref. RB
|
|
|
5.00
|
%
|
|
|
05/15/40
|
|
|
|
575
|
|
|
|
620,931
|
|
|
Matagorda (County of) Navigation District No. 1
(CenterPoint Energy Houston Electric, LLC); Series 2004,
Ref.
Collateralized RB
(e)
|
|
|
5.60
|
%
|
|
|
03/01/27
|
|
|
|
1,250
|
|
|
|
1,306,125
|
|
|
North Central Texas Health Facility Development Corp.
(Childrens Medical Center of Dallas); Series 2002,
Hospital RB
(INSAMBAC)
(a)
|
|
|
5.25
|
%
|
|
|
08/15/32
|
|
|
|
1,000
|
|
|
|
1,017,080
|
|
|
North Texas Tollway Authority;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 B, Ref. First Tier System RB
|
|
|
6.00
|
%
|
|
|
01/01/26
|
|
|
|
360
|
|
|
|
430,096
|
|
|
Series 2008 B, Ref. First Tier System RB
|
|
|
5.63
|
%
|
|
|
01/01/28
|
|
|
|
540
|
|
|
|
605,092
|
|
|
Series 2008 F, Ref. Second Tier System RB
|
|
|
5.75
|
%
|
|
|
01/01/33
|
|
|
|
1,000
|
|
|
|
1,087,820
|
|
|
Series 2008 L-2, Ref. First
Tier System RB
(d)(e)
|
|
|
6.00
|
%
|
|
|
01/01/13
|
|
|
|
600
|
|
|
|
627,144
|
|
|
Series 2011 A, Special Projects
System RB
(b)
|
|
|
5.50
|
%
|
|
|
09/01/36
|
|
|
|
1,050
|
|
|
|
1,216,268
|
|
|
Tarrant County Cultural Education Facilities Finance Corp.
(Buckingham Senior Living Community, Inc.); Series 2007,
Retirement Facility RB
|
|
|
5.75
|
%
|
|
|
11/15/37
|
|
|
|
195
|
|
|
|
193,943
|
|
|
Tarrant County Cultural Education Facilities Finance Corp.
(Buckner Retirement Services, Inc.); Series 2007,
Retirement Facility RB
|
|
|
5.25
|
%
|
|
|
11/15/37
|
|
|
|
1,000
|
|
|
|
1,011,470
|
|
|
Tarrant County Cultural Education Facilities Finance Corp. (C.C.
Young Memorial Home); Series 2009 B-2, Retirement Facility
RB
|
|
|
6.50
|
%
|
|
|
02/15/14
|
|
|
|
275
|
|
|
|
275,170
|
|
|
Tarrant County Cultural Education Facilities Finance Corp.
(CHRISTUS Health); Series 2008 A, Ref. RB
(INSAGC)
(a)
|
|
|
6.25
|
%
|
|
|
07/01/28
|
|
|
|
1,200
|
|
|
|
1,407,456
|
|
|
Texas (State of) Transportation Commission; Series 2008,
Mobility Fund Unlimited Tax GO
Bonds
(b)
|
|
|
5.00
|
%
|
|
|
04/01/28
|
|
|
|
2,215
|
|
|
|
2,582,779
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
15 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Texas(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Texas A&M University System Board of Regents;
Series 2009 A, Financing System RB
|
|
|
5.00
|
%
|
|
|
05/15/28
|
|
|
$
|
1,000
|
|
|
$
|
1,157,200
|
|
|
Texas Private Activity Bond Surface Transportation Corp. (NTE
Mobility Partners LLC North Tarrant Express Management Lanes);
Series 2009, Sr. Lien RB
|
|
|
6.88
|
%
|
|
|
12/31/39
|
|
|
|
560
|
|
|
|
636,277
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30,115,486
|
|
|
Virgin Islands0.57%
|
|
|
|
|
|
|
|
|
|
|
|
|
Virgin Islands (Government of) Public Finance Authority
(Matching Fund Loan Note); Series 2010 A, Sr.
Lien RB
|
|
|
5.00
|
%
|
|
|
10/01/25
|
|
|
|
1,000
|
|
|
|
1,081,870
|
|
|
Virginia1.37%
|
|
|
|
|
|
|
|
|
|
|
|
|
Richmond (City of) Industrial Development Authority;
Series 2001, Government Facilities RB
(INSAMBAC)
(a)
|
|
|
5.00
|
%
|
|
|
07/15/15
|
|
|
|
1,000
|
|
|
|
1,088,330
|
|
|
Tobacco Settlement Financing Corp.; Series 2005,
Asset-Backed RB
(h)
|
|
|
5.50
|
%
|
|
|
06/01/26
|
|
|
|
1,400
|
|
|
|
1,534,568
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,622,898
|
|
|
Washington7.74%
|
|
|
|
|
|
|
|
|
|
|
|
|
Chelan (County of) Public Utility District No. 1;
Series 2011 A, Ref.
Consolidated RB
(c)
|
|
|
5.50
|
%
|
|
|
07/01/26
|
|
|
|
550
|
|
|
|
648,478
|
|
|
Kalispel Tribe of Indians; Series 2008, RB
|
|
|
6.75
|
%
|
|
|
01/01/38
|
|
|
|
3,000
|
|
|
|
2,521,920
|
|
|
Seattle (Port of); Series 2012 A, Ref. Intermediate
Lien RB
|
|
|
5.00
|
%
|
|
|
08/01/30
|
|
|
|
750
|
|
|
|
864,150
|
|
|
Spokane (City of) Public Facilities District; Series 2003,
Hotel, Motel & Sales Use Tax RB
(INSNATL)
(a)
|
|
|
5.25
|
%
|
|
|
09/01/33
|
|
|
|
5,000
|
|
|
|
5,128,100
|
|
|
Washington (State of) (SR 520 Corridor ProgramToll
Revenue); Series 2011 C, Motor Vehicle Fuel Unlimited
Tax GO
Bonds
(b)
|
|
|
5.00
|
%
|
|
|
06/01/33
|
|
|
|
600
|
|
|
|
691,872
|
|
|
Washington (State of) Health Care Facilities Authority (Catholic
Health Initiatives);
Series 2011 A, RB
(b)
|
|
|
5.00
|
%
|
|
|
02/01/41
|
|
|
|
840
|
|
|
|
896,960
|
|
|
Washington (State of) Health Care Facilities Authority (Swedish
Health Services); Series 2011 A, RB
|
|
|
6.25
|
%
|
|
|
11/15/41
|
|
|
|
375
|
|
|
|
428,111
|
|
|
Washington (State of) Housing Finance Commission (Wesley Homes);
Series 2008, Non-Profit
CR RB
(g)
|
|
|
6.00
|
%
|
|
|
01/01/27
|
|
|
|
560
|
|
|
|
572,090
|
|
|
Washington (State of); Series 1993 B, Unlimited Tax GO
Bonds
|
|
|
5.50
|
%
|
|
|
05/01/18
|
|
|
|
2,690
|
|
|
|
3,072,411
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
14,824,092
|
|
|
West Virginia1.86%
|
|
|
|
|
|
|
|
|
|
|
|
|
Harrison (County of) Commission (Allegheny Energy);
Series 2007 D, Ref. Solid Waste
Disposal RB
(c)
|
|
|
5.50
|
%
|
|
|
10/15/37
|
|
|
|
1,750
|
|
|
|
1,800,995
|
|
|
West Virginia (State of) Hospital Finance Authority (Thomas
Health System);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008, RB
|
|
|
6.00
|
%
|
|
|
10/01/20
|
|
|
|
400
|
|
|
|
404,524
|
|
|
Series 2008, RB
|
|
|
6.25
|
%
|
|
|
10/01/23
|
|
|
|
425
|
|
|
|
430,109
|
|
|
West Virginia (State of) Hospital Finance Authority (West
Virginia United Health System Obligated Group);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2009 C, Ref. & Improvement RB
|
|
|
5.50
|
%
|
|
|
06/01/34
|
|
|
|
400
|
|
|
|
434,420
|
|
|
Series 2009 C, Ref. & Improvement RB
|
|
|
5.50
|
%
|
|
|
06/01/39
|
|
|
|
450
|
|
|
|
482,593
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,552,641
|
|
|
Wisconsin1.77%
|
|
|
|
|
|
|
|
|
|
|
|
|
Superior (City of) (Superior Water, Light & Power Co.);
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2007 A, Ref. Collateralized
Utility RB
(c)
|
|
|
5.38
|
%
|
|
|
11/01/21
|
|
|
|
175
|
|
|
|
190,519
|
|
|
Series 2007 B, Collateralized
Utility RB
(c)
|
|
|
5.75
|
%
|
|
|
11/01/37
|
|
|
|
150
|
|
|
|
156,992
|
|
|
Wisconsin (State of) Health & Educational Facilities
Authority (Aurora Health Care, Inc.);
Series 2009 B, RB
(d)(e)
|
|
|
5.13
|
%
|
|
|
08/15/16
|
|
|
|
500
|
|
|
|
563,130
|
|
|
Wisconsin (State of) Health & Educational Facilities
Authority (Prohealth Care, Inc. Obligated Group);
Series 2009, RB
|
|
|
6.63
|
%
|
|
|
02/15/39
|
|
|
|
720
|
|
|
|
819,072
|
|
|
Wisconsin (State of) Housing & Economic Development
Authority;
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series 2008 A, Home
Ownership RB
(b)(c)
|
|
|
5.30
|
%
|
|
|
09/01/23
|
|
|
|
1,000
|
|
|
|
1,064,940
|
|
|
Series 2008 A, Home
Ownership RB
(b)(c)
|
|
|
5.50
|
%
|
|
|
09/01/28
|
|
|
|
147
|
|
|
|
154,500
|
|
|
Wisconsin (State of); Series 2009 A, General
Fund Annual Appropriation RB
|
|
|
5.38
|
%
|
|
|
05/01/25
|
|
|
|
370
|
|
|
|
436,030
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,385,183
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
16 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Principal
|
|
|
|
|
Interest
|
|
Maturity
|
|
Amount
|
|
|
|
|
Rate
|
|
Date
|
|
(000)
|
|
Value
|
|
Wyoming0.30%
|
|
|
|
|
|
|
|
|
|
|
|
|
Sweetwater (County of) (Idaho Power Co.); Series 2006, Ref.
PCR
|
|
|
5.25
|
%
|
|
|
07/15/26
|
|
|
$
|
500
|
|
|
$
|
572,866
|
|
|
TOTAL
INVESTMENTS
(l)
166.55%
(Cost $298,395,975)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
318,886,580
|
|
|
FLOATING RATE NOTE OBLIGATIONS(29.35%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes with interest rates ranging from 0.13% to 0.31% at
02/29/12
and
contractual maturities of collateral ranging from
09/01/23
to
12/15/41
(See
Note 1K)
(m)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(56,205,000
|
)
|
|
OTHER ASSETS LESS LIABILITIES(0.14%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(262,203
|
)
|
|
PREFERRED SHARES(37.06%)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(70,950,000
|
)
|
|
NET ASSETS APPLICABLE TO COMMON SHARES100.00%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$
|
191,469,377
|
|
|
Investment Abbreviations:
|
|
|
AGC
|
|
Assured Guaranty Corp.
|
AGM
|
|
Assured Guaranty Municipal Corp.
|
AMBAC
|
|
American Municipal Bond Assurance Corp.
|
BHAC
|
|
Berkshire Hathaway Assurance Corp.
|
CAB
|
|
Capital Appreciation Bonds
|
Conv.
|
|
Convertible
|
COP
|
|
Certificates of Participation
|
CR
|
|
Custodial Receipts
|
GO
|
|
General Obligation
|
IDR
|
|
Industrial Development Revenue Bonds
|
INS
|
|
Insurer
|
LOC
|
|
Letter of Credit
|
MFH
|
|
Multi-Family Housing
|
NATL
|
|
National Public Finance Guarantee Corp.
|
PCR
|
|
Pollution Control Revenue Bonds
|
PILOT
|
|
Payment-in-Lieu-of-Tax
|
RB
|
|
Revenue Bonds
|
Ref.
|
|
Refunding
|
Sec.
|
|
Secured
|
SGI
|
|
Syncora Guarantee, Inc.
|
Sr.
|
|
Senior
|
Sub.
|
|
Subordinated
|
TEMPS
|
|
Tax-Exempt Mandatory Paydown Securities
|
VRD
|
|
Variable Rate Demand
|
Notes to Schedule of Investments:
|
|
|
(a)
|
|
Principal
and/or
interest payments are secured by the bond insurance company
listed.
|
(b)
|
|
Underlying security related to
Dealer Trusts entered into by the Trust. See Note 1K.
|
(c)
|
|
Security subject to the alternative
minimum tax.
|
(d)
|
|
Security has an irrevocable call by
the issuer or mandatory put by the holder. Maturity date
reflects such call or put.
|
(e)
|
|
Interest or dividend rate is
redetermined periodically. Rate shown is the rate in effect on
February 29, 2012.
|
(f)
|
|
Zero coupon bond issued at a
discount.
|
(g)
|
|
Security purchased or received in a
transaction exempt from registration under the Securities Act of
1933, as amended. The security may be resold pursuant to an
exemption from registration under the 1933 Act, typically to
qualified institutional buyers. The aggregate value of these
securities at February 29, 2012 was $3,826,153, which
represented 2.00% of the Trusts Net Assets.
|
(h)
|
|
Advance refunded; secured by an
escrow fund of U.S. Government obligations or other highly
rated collateral.
|
(i)
|
|
Demand security payable upon demand
by the Trust at specified time intervals no greater than
thirteen months. Interest rate is redetermined periodically.
Rate shown is the rate in effect on February 29, 2012.
|
(j)
|
|
Principal and interest payments are
fully enhanced by a letter of credit from the bank listed or a
predecessor bank, branch or subsidiary.
|
(k)
|
|
Defaulted security. Currently, the
issuer is partially or fully in default with respect to interest
payments. The aggregate value of these securities at
February 29, 2012 was $263,479, which represented 0.14% of
the Trusts Net Assets.
|
(l)
|
|
This table provides a listing of
those entities that have either issued, guaranteed, backed or
otherwise enhanced the credit quality of more than 5% of the
securities held in the portfolio. In instances where the entity
has guaranteed, backed or otherwise enhanced the credit quality
of a security, it is not primarily responsible for the
issuers obligations but may be called upon to satisfy the
issuers obligations.
|
|
|
|
|
|
Entities
|
|
Percentage
|
|
Assured Guaranty Municipal Corp.
|
|
|
8.1
|
%
|
|
National Public Finance Guarantee Corp.
|
|
|
6.6
|
|
|
American Municipal Bond Assurance Corp.
|
|
|
5.2
|
|
|
|
|
|
(m)
|
|
Floating rate note obligations
related to securities held. The interest rates shown reflect the
rates in effect at February 29, 2012. At February 29,
2012, the Trusts investments with a value of $100,477,468
are held by Dealer Trusts and serve as collateral for the
$56,205,000 in the floating rate note obligations outstanding at
that date.
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
17 Invesco
Van Kampen Select Sector Municipal Trust
Statement
of Assets and Liabilities
February 29,
2012
|
|
|
|
|
Assets:
|
Investments, at value (Cost $298,395,975)
|
|
$
|
318,886,580
|
|
|
Receivable for:
|
|
|
|
|
Investments sold
|
|
|
20,000
|
|
|
Interest
|
|
|
3,783,466
|
|
|
Fund expenses absorbed
|
|
|
28,950
|
|
|
Total assets
|
|
|
322,718,996
|
|
|
Liabilities:
|
Floating rate note obligations
|
|
|
56,205,000
|
|
|
Payable for:
|
|
|
|
|
Investments purchased
|
|
|
855,600
|
|
|
Amount due custodian
|
|
|
3,000,044
|
|
|
Income distributions preferred and common shares
|
|
|
37,178
|
|
|
Accrued other operating expenses
|
|
|
201,797
|
|
|
Total liabilities
|
|
|
60,299,619
|
|
|
Preferred shares ($0.01 par value, authorized
100,000,000 shares, 2,838 issued with liquidation
preference of $25,000 per share)
|
|
|
70,950,000
|
|
|
Net assets attributable to common shares
|
|
$
|
191,469,377
|
|
|
Net assets applicable to common shares consist of:
|
Shares of beneficial interest common shares
|
|
$
|
203,894,684
|
|
|
Undistributed net investment income
|
|
|
2,648,578
|
|
|
Undistributed net realized gain (loss)
|
|
|
(35,564,490
|
)
|
|
Unrealized appreciation
|
|
|
20,490,605
|
|
|
|
|
$
|
191,469,377
|
|
|
Shares outstanding, $0.01 par value per common share, with an
unlimited number of shares authorized:
|
Common shares outstanding
|
|
|
15,190,715
|
|
|
Net asset value per common share
|
|
$
|
12.60
|
|
|
Market value per common share
|
|
$
|
13.11
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
18 Invesco
Van Kampen Select Sector Municipal Trust
Statement
of Operations
For
the year ended February 29, 2012
|
|
|
|
|
Investment income:
|
Interest
|
|
$
|
15,014,379
|
|
|
Expenses:
|
Advisory fees
|
|
|
1,660,443
|
|
|
Administrative services fees
|
|
|
50,000
|
|
|
Custodian fees
|
|
|
10,690
|
|
|
Interest, facilities and maintenance fees
|
|
|
410,805
|
|
|
Transfer agent fees
|
|
|
21,621
|
|
|
Trustees and officers fees and benefits
|
|
|
36,616
|
|
|
Other
|
|
|
214,634
|
|
|
Total expenses
|
|
|
2,404,809
|
|
|
Less: Fees waived
|
|
|
(81,874
|
)
|
|
Net expenses
|
|
|
2,322,935
|
|
|
Net investment income
|
|
|
12,691,444
|
|
|
Realized and unrealized gain (loss):
|
Net realized gain (loss) from investment securities
|
|
|
(4,401,130
|
)
|
|
Change in net unrealized appreciation of investment securities
|
|
|
30,035,252
|
|
|
Net realized and unrealized gain
|
|
|
25,634,122
|
|
|
Distributions to preferred shareholders from net investment
income
|
|
|
(209,318
|
)
|
|
Net increase in net assets resulting from operations applicable
to common shares
|
|
$
|
38,116,248
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
19 Invesco
Van Kampen Select Sector Municipal Trust
Statement
of Changes in Net Assets
For
the year ended February 29, 2012, for the period
November 1, 2010 to February 28, 2011 and the year
ended October 31, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Four months
|
|
|
|
|
Year ended
|
|
ended
|
|
Year ended
|
|
|
February 29,
|
|
February 28,
|
|
October 31,
|
|
|
2012
|
|
2011
|
|
2010
|
|
Operations:
|
Net investment income
|
|
$
|
12,691,444
|
|
|
$
|
4,497,836
|
|
|
$
|
13,757,525
|
|
|
Net realized gain (loss)
|
|
|
(4,401,130
|
)
|
|
|
(486,511
|
)
|
|
|
(3,033,069
|
)
|
|
Change in net unrealized appreciation (depreciation)
|
|
|
30,035,252
|
|
|
|
(18,671,357
|
)
|
|
|
14,484,927
|
|
|
Distributions to preferred shareholders from net investment
income
|
|
|
(209,318
|
)
|
|
|
(113,023
|
)
|
|
|
(344,844
|
)
|
|
Net increase (decrease) in net assets from operations applicable
to common shares
|
|
|
38,116,248
|
|
|
|
(14,773,055
|
)
|
|
|
24,864,539
|
|
|
Distributions to common shareholders from net investment income
|
|
|
(13,307,067
|
)
|
|
|
(4,435,689
|
)
|
|
|
(13,200,732
|
)
|
|
Net increase (decrease) in net assets applicable to common
shares resulting from investment activities
|
|
|
24,809,181
|
|
|
|
(19,208,744
|
)
|
|
|
11,663,807
|
|
|
Net assets applicable to common shares:
|
Beginning of period
|
|
|
166,660,196
|
|
|
|
185,868,940
|
|
|
|
174,205,133
|
|
|
End of period (includes undistributed net investment income of
$2,648,578, $3,529,716 and $3,661,062, respectively)
|
|
$
|
191,469,377
|
|
|
$
|
166,660,196
|
|
|
$
|
185,868,940
|
|
|
See accompanying Notes to Financial Statements which are an
integral part of the financial statements.
20 Invesco
Van Kampen Select Sector Municipal Trust
Statement
of Cash Flows
For
the year ended February 29, 2012
|
|
|
|
|
Cash provided by operating activities:
|
Net increase in net assets applicable to common shares resulting
from operations
|
|
$
|
38,116,248
|
|
|
Adjustments to reconcile the change in net assets applicable to
common shares from operations to net cash provided by operating
activities:
|
Net realized loss from investments
|
|
|
4,401,130
|
|
|
Net change in unrealized appreciation (depreciation) on
investments
|
|
|
(30,035,252
|
)
|
|
Amortization of premium and accretion of discount
|
|
|
312,768
|
|
|
Cost of purchases of investments
|
|
|
(42,406,387
|
)
|
|
Proceeds from sales of investments
|
|
|
38,482,194
|
|
|
Decrease in interest receivables and other assets
|
|
|
48,723
|
|
|
Decrease in accrued expenses and other payables
|
|
|
(99,418
|
)
|
|
Net cash provided by operating activities
|
|
|
8,820,006
|
|
|
Cash flows provided by (used in) financing activities:
|
Proceeds from redemptions of preferred shares
|
|
|
(12,900,000
|
)
|
|
Dividends paid to common shareholders from net investment income
|
|
|
(13,319,931
|
)
|
|
Increase in payable for amount due to custodian
|
|
|
1,794,925
|
|
|
Proceeds from floating rate note obligations
|
|
|
15,605,000
|
|
|
Net cash provided by (used in) financing activities
|
|
|
(8,820,006
|
)
|
|
Net increase in cash
|
|
|
|
|
|
Cash at the beginning of the period
|
|
|
|
|
|
Cash at the end of the period
|
|
|
|
|
|
Supplemental disclosure:
|
Cash paid during the period for interest, facilities and
maintenance fees
|
|
$
|
498,958
|
|
|
Notes
to Financial Statements
February 29,
2012
NOTE 1Significant
Accounting Policies
Invesco Van Kampen Select Sector Municipal Trust (the
Trust), a Massachusetts business trust, is
registered under the Investment Company Act of 1940, as amended
(the 1940 Act), as a diversified, closed-end
management investment company.
The Trusts primary investment objective is to
seek to provide a high level of current income which is exempt
from federal income tax, consistent with preservation of capital.
The following is a summary of the significant
accounting policies followed by the Trust in the preparation of
its financial statements.
|
|
|
A.
|
|
Security
Valuations
Securities, including
restricted securities, are valued according to the following
policy.
|
|
|
Securities are fair valued using an
evaluated quote provided by an independent pricing service
approved by the Board of Trustees. Evaluated quotes provided by
the pricing service may be determined without exclusive reliance
on quoted prices and may reflect appropriate factors such as
institution-size trading in similar groups of securities, yield,
quality, coupon rate, maturity, type of issue, individual
trading characteristics and other market data. Securities with a
demand feature exercisable within one to seven days are valued
at par. Debt securities are subject to interest rate and credit
risks. In addition, all debt securities involve some risk of
default with respect to interest and principal payments.
|
|
|
Securities for which market quotations
either are not readily available or are unreliable are valued at
fair value as determined in good faith by or under the
supervision of the Trusts officers following procedures
approved by the Board of Trustees. Some of the factors which may
be considered in determining fair value are fundamental
analytical data relating to the investment; the nature and
duration of any restrictions on transferability or disposition;
trading in similar securities by the same issuer or comparable
companies; relevant political, economic or issuer specific news;
and other relevant factors under the circumstances.
|
21 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
Valuations change in response to many
factors including the historical and prospective earnings of the
issuer, the value of the issuers assets, general economic
conditions, interest rates, investor perceptions and market
liquidity. Because of the inherent uncertainties of valuation,
the values reflected in the financial statements may materially
differ from the value received upon actual sale of those
investments.
|
B.
|
|
Securities
Transactions and Investment Income
Securities transactions are accounted for on a trade date basis.
Realized gains or losses on sales are computed on the basis of
specific identification of the securities sold. Interest income
is recorded on the accrual basis from settlement date. Dividend
income (net of withholding tax, if any) is recorded on the
ex-dividend date. Bond premiums and discounts are amortized
and/or
accreted for financial reporting purposes.
|
|
|
The Trust may periodically participate
in litigation related to Trust investments. As such, the Trust
may receive proceeds from litigation settlements. Any proceeds
received are included in the Statement of Operations as realized
gain (loss) for investments no longer held and as unrealized
gain (loss) for investments still held.
|
|
|
Brokerage commissions and mark ups are
considered transaction costs and are recorded as an increase to
the cost basis of securities purchased
and/or
a
reduction of proceeds on a sale of securities. Such transaction
costs are included in the determination of net realized and
unrealized gain (loss) from investment securities reported in
the Statement of Operations and the Statement of Changes in Net
Assets and the net realized and unrealized gains (losses) on
securities per share in the Financial Highlights. Transaction
costs are included in the calculation of the Trusts net
asset value and, accordingly, they reduce the Trusts total
returns. These transaction costs are not considered operating
expenses and are not reflected in net investment income reported
in the Statement of Operations and Statement of Changes in Net
Assets, or the net investment income per share and ratios of
expenses and net investment income reported in the Financial
Highlights, nor are they limited by any expense limitation
arrangements between the Trust and the investment adviser.
|
C.
|
|
Country
Determination
For the purposes of making
investment selection decisions and presentation in the Schedule
of Investments, the investment adviser may determine the country
in which an issuer is located
and/or
credit risk exposure based on various factors. These factors
include the laws of the country under which the issuer is
organized, where the issuer maintains a principal office, the
country in which the issuer derives 50% or more of its total
revenues and the country that has the primary market for the
issuers securities, as well as other criteria. Among the
other criteria that may be evaluated for making this
determination are the country in which the issuer maintains 50%
or more of its assets, the type of security, financial
guarantees and enhancements, the nature of the collateral and
the sponsor organization. Country of issuer
and/or
credit risk exposure has been determined to be the United States
of America, unless otherwise noted.
|
D.
|
|
Distributions
The Trust declares and pays monthly dividends from net
investment income to common shareholders. Distributions from net
realized capital gain, if any, are generally paid annually and
are distributed on a pro rata basis to common and preferred
shareholders. The Trust may elect to treat a portion of the
proceeds from redemptions as distributions for federal income
tax purposes.
|
E.
|
|
Federal Income
Taxes
The Trust intends to comply with
the requirements of Subchapter M of the Internal Revenue
Code necessary to qualify as a regulated investment company and
to distribute substantially all of the Trusts taxable
earnings to shareholders. As such, the Trust will not be subject
to federal income taxes on otherwise taxable income (including
net realized capital gain) that is distributed to shareholders.
Therefore, no provision for federal income taxes is recorded in
the financial statements.
|
|
|
In addition, the Trust intends to invest
in such municipal securities to allow it to qualify to pay
shareholders exempt dividends, as defined in the
Internal Revenue Code.
|
|
|
The Trust files tax returns in the
U.S. Federal jurisdiction and certain other jurisdictions.
Generally, the Trust is subject to examinations by such taxing
authorities for up to three years after the filing of the return
for the tax period.
|
F.
|
|
Interest,
Facilities and Maintenance Fees
Interest,
Facilities and Maintenance Fees include interest and related
borrowing costs such as commitment fees and other expenses
associated with lines of credit and interest and administrative
expenses related to establishing and maintaining Auction Rate
Preferred Shares and floating rate note obligations, if any.
|
G.
|
|
Accounting
Estimates
The preparation of financial
statements in conformity with accounting principles generally
accepted in the United States of America (GAAP)
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
revenues and expenses during the reporting period including
estimates and assumptions related to taxation. Actual results
could differ from those estimates by a significant amount. In
addition, the Trust monitors for material events or transactions
that may occur or become known after the period-end date and
before the date the financial statements are released to print.
|
H.
|
|
Indemnifications
Under the Trusts organizational documents, each Trustee,
officer, employee or other agent of the Trust is indemnified
against certain liabilities that may arise out of performance of
their duties to the Trust. Additionally, in the normal course of
business, the Trust enters into contracts, including the
Trusts servicing agreements that contain a variety of
indemnification clauses. The Trusts maximum exposure under
these arrangements is unknown as this would involve future
claims that may be made against the Trust that have not yet
occurred. The risk of material loss as a result of such
indemnification claims is considered remote.
|
I.
|
|
Other
Risks
The value of, payment of interest
on, repayment of principal for and the ability to sell a
municipal security may be affected by constitutional amendments,
legislative enactments, executive orders, administrative
regulations, voter initiatives and the economics of the regions
in which the issuers are located.
|
|
|
Since many municipal securities are
issued to finance similar projects, especially those relating to
education, health care, transportation and utilities, conditions
in those sectors can affect the overall municipal securities
market and a Trusts investments in municipal securities.
|
|
|
There is some risk that a portion or all
of the interest received from certain tax-free municipal
securities could become taxable as a result of determinations by
the Internal Revenue Service.
|
J.
|
|
Cash and Cash
Equivalents
For the purposes of the
Statement of Cash Flows the Trust defines Cash and Cash
Equivalents as cash (including foreign currency), money market
funds and other investments held in lieu of cash and excludes
investments made with cash collateral received.
|
K.
|
|
Floating Rate
Note Obligations
The Trust invests
in inverse floating rate securities, such as Residual Interest
Bonds (RIBs) or Tender Option Bonds
(TOBs) for investment purposes and to enhance the
yield of the Trust. Inverse floating rate investments tend to
underperform the market
|
22 Invesco
Van Kampen Select Sector Municipal Trust
|
|
|
|
|
for fixed rate bonds in a rising interest rate environment, but
tend to outperform the market for fixed rate bonds when interest
rates decline or remain relatively stable. Such transactions may
be purchased in the secondary market without first owning the
underlying bond or by the sale of fixed rate bonds by the Trust
to special purpose trusts established by a broker dealer
(Dealer Trusts) in exchange for cash and residual
interests in the Dealer Trusts assets and cash flows,
which are in the form of inverse floating rate securities. The
Dealer Trusts finance the purchases of the fixed rate bonds by
issuing floating rate notes to third parties and allowing the
Trust to retain residual interest in the bonds. The floating
rate notes issued by the Dealer Trusts have interest rates that
reset weekly and the floating rate note holders have the option
to tender their notes to the Dealer Trusts for redemption at par
at each reset date. The residual interests held by the Trust
(inverse floating rate investments) include the right of the
Trust (1) to cause the holders of the floating rate notes
to tender their notes at par at the next interest rate reset
date, and (2) to transfer the municipal bond from the
Dealer Trusts to the Trust, thereby collapsing the Dealer Trusts.
|
|
|
TOBs are presently classified as private
placement securities. Private placement securities are subject
to restrictions on resale because they have not been registered
under the Securities Act of 1933, as amended or are otherwise
not readily marketable. As a result of the absence of a public
trading market for these securities, they may be less liquid
than publicly traded securities. Although these securities may
be resold in privately negotiated transactions, the prices
realized from these sales could be less than those originally
paid by the Trust or less than what may be considered the fair
value of such securities.
|
|
|
The Trust accounts for the transfer of
bonds to the Dealer Trusts as secured borrowings, with the
securities transferred remaining in the Trusts investment
assets, and the related floating rate notes reflected as Trust
liabilities under the caption
Floating rate note
obligations
on the Statement of Assets and Liabilities. The
Trust records the interest income from the fixed rate bonds
under the caption
Interest
and records the expenses
related to floating rate obligations and any administrative
expenses of the Dealer Trusts as a component of
Interest,
facilities and maintenance fees
on the Statement of
Operations.
|
|
|
The Trust generally invests in inverse
floating rate securities that include embedded leverage, thus
exposing the Trust to greater risks and increased costs. The
primary risks associated with inverse floating rate securities
are varying degrees of liquidity and the changes in the value of
such securities in response to changes in market rates of
interest to a greater extent than the value of an equal
principal amount of a fixed rate security having similar credit
quality, redemption provisions and maturity which may cause the
Trusts net asset value to be more volatile than if it had
not invested in inverse floating rate securities. In certain
instances, the short-term floating rate interests created by the
special purpose trust may not be able to be sold to third
parties or, in the case of holders tendering (or putting) such
interests for repayment of principal, may not be able to be
remarketed to third parties. In such cases, the special purpose
trust holding the long-term fixed rate bonds may be collapsed.
In the case of RIBs or TOBs created by the contribution of
long-term fixed income bonds by the Trust, the Trust will then
be required to repay the principal amount of the tendered
securities. During times of market volatility, illiquidity or
uncertainty, the Trust could be required to sell other portfolio
holdings at a disadvantageous time to raise cash to meet that
obligation.
|
NOTE 2Advisory
Fees and Other Fees Paid to Affiliates
The Trust has entered into a master investment advisory
agreement with Invesco Advisers, Inc. (the Adviser
or Invesco). Under the terms of the investment
advisory agreement, the Trust pays an advisory fee to the
Adviser based on the annual rate 0.55% of the Trusts
average daily managed assets including current preferred shares
and leverage entered into to retire previously issued preferred
shares of the Trust.
Under the terms of a master
sub-advisory
agreement between the Adviser and each of Invesco Asset
Management Deutschland GmbH, Invesco Asset Management Limited,
Invesco Asset Management (Japan) Limited, Invesco Australia
Limited, Invesco Hong Kong Limited, Invesco Senior Secured
Management, Inc. and Invesco Canada Ltd. (collectively, the
Affiliated
Sub-Advisers)
the Adviser, not the Trust, may pay 40% of the fees paid to the
Adviser to any such Affiliated
Sub-Adviser(s)
that provide(s) discretionary investment management services to
the Trust based on the percentage of assets allocated to such
Sub-Adviser(s).
The Adviser has contractually agreed, through at
least June 30, 2012, to waive advisory fees
and/or
reimburse expenses to the extent necessary to limit the
Trusts expenses (excluding certain items discussed below)
to 1.07%. In determining the Advisers obligation to waive
advisory fees
and/or
reimburse expenses, the following expenses are not taken into
account, and could cause the Trusts expenses to exceed the
limit reflected above: (1) interest, facilities,
maintenance fees; (2) taxes; (3) dividend expense on
short sales; (4) extraordinary or non-routine items,
including litigation expenses; and (5) expenses that the
Trust has incurred but did not actually pay because of an
expense offset arrangement. Unless the Board of Trustees and
Invesco mutually agree to amend or continue the fee waiver
agreement, it will terminate on June 30, 2012. The Adviser
did not waive fees
and/or
reimburse expenses during the period under this expense
limitation.
For the period ended February 29, 2012, the
Adviser waived advisory fees of $81,874.
The Trust has entered into a master administrative
services agreement with Invesco pursuant to which the Trust has
agreed to pay Invesco for certain administrative costs incurred
in providing accounting services to the Trust. For the year
ended February 29, 2012, expenses incurred under this
agreement are shown in the Statement of Operations as
administrative services fees.
Certain officers and trustees of the Trust are
officers and directors of Invesco.
NOTE 3Additional
Valuation Information
GAAP defines fair value as the price that would be received to
sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date,
under current market conditions. GAAP establishes a hierarchy
that prioritizes the inputs to valuation methods giving the
highest priority to readily available unadjusted quoted prices
in an active market for identical assets (Level 1) and
the lowest priority to significant unobservable inputs
23 Invesco
Van Kampen Select Sector Municipal Trust
(Level 3) generally when market prices are not readily
available or are unreliable. Based on the valuation inputs, the
securities or other investments are tiered into one of three
levels. Changes in valuation methods may result in transfers in
or out of an investments assigned level:
|
|
|
|
Level 1
|
Prices are determined using quoted prices in an active market
for identical assets.
|
|
Level 2
|
Prices are determined using other significant observable inputs.
Observable inputs are inputs that other market participants may
use in pricing a security. These may include quoted prices for
similar securities, interest rates, prepayment speeds, credit
risk, yield curves, loss severities, default rates, discount
rates, volatilities and others.
|
|
Level 3
|
Prices are determined using significant unobservable inputs. In
situations where quoted prices or observable inputs are
unavailable (for example, when there is little or no market
activity for an investment at the end of the period),
unobservable inputs may be used. Unobservable inputs reflect the
Trusts own assumptions about the factors market
participants would use in determining fair value of the
securities or instruments and would be based on the best
available information.
|
The following is a summary of the tiered valuation
input levels, as of February 29, 2012. The level assigned
to the securities valuations may not be an indication of the
risk or liquidity associated with investing in those securities.
Because of the inherent uncertainties of valuation, the values
reflected in the financial statements may materially differ from
the value received upon actual sale of those investments.
During the year ended February 29, 2012, there
were no significant transfers between investment levels.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Municipal Obligations
|
|
$
|
|
|
|
$
|
318,886,580
|
|
|
$
|
|
|
|
$
|
318,886,580
|
|
|
NOTE 4Security
Transactions with Affiliated Funds
The Fund is permitted to purchase or sell securities from or to
certain other Invesco Funds under specified conditions outlined
in procedures adopted by the Board of Trustees of the Trust. The
procedures have been designed to ensure that any purchase or
sale of securities by the Fund from or to another fund or
portfolio that is or could be considered an affiliate by virtue
of having a common investment adviser (or affiliated investment
advisers), common Trustees
and/or
common officers complies with
Rule 17a-7
of the 1940 Act. Further, as defined under the procedures, each
transaction is effected at the current market price. Pursuant to
these procedures, for the year ended February 29, 2012, the
Fund engaged in securities purchases of $879,259.
NOTE 5Trustees
and Officers Fees and Benefits
Trustees and Officers Fees and Benefits
include amounts accrued by the Trust to pay remuneration to
certain Trustees and Officers of the Trust.
During the year ended February 29, 2012, the
Trust paid legal fees of $37,749 for services rendered by
Skadden, Arps, Slate, Meagher & Flom LLP as counsel to
the Trust. A trustee of the Trust is of counsel with the firm.
NOTE 6Cash
Balances and Borrowings
The Trust is permitted to temporarily carry a negative or
overdrawn balance in its account with State Street Bank and
Trust Company, the custodian bank. Such balances, if any at
period end, are shown in the Statement of Assets and Liabilities
under the payable caption
amount due custodian
. To
compensate the custodian bank for such overdrafts, the overdrawn
Trust may either (1) leave funds as a compensating balance
in the account so the custodian bank can be compensated by
earning the additional interest; or (2) compensate by
paying the custodian bank at a rate agreed upon by the custodian
bank and Invesco, not to exceed the contractually agreed upon
rate.
Inverse floating rate obligations resulting from the
transfer of bonds to Dealer Trusts are accounted for as secured
borrowings. The average floating rate notes outstanding and
average annual interest and fees related to inverse floating
rate note obligations during the year ended February 29,
2012 were $42,868,846 and 0.76%, respectively.
NOTE 7Distributions
to Shareholders and Tax Components of Net Assets
Tax Character
of Distributions to Shareholders Paid During the year ended
February 29, 2012, for the period November 1, 2010 to
February 28, 2011 and the year ended October 31,
2010:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Four months
|
|
|
|
|
Year ended
|
|
ended
|
|
Year ended
|
|
|
February 29,
|
|
February 28,
|
|
October 31,
|
|
|
2012
|
|
2011
|
|
2010
|
|
Ordinary income
|
|
$
|
|
|
|
$
|
|
|
|
$
|
70,082
|
|
|
Tax-exempt income
|
|
|
13,516,385
|
|
|
|
4,548,712
|
|
|
|
13,475,494
|
|
|
Total distributions
|
|
$
|
13,516,385
|
|
|
$
|
4,548,712
|
|
|
$
|
13,545,576
|
|
|
24 Invesco
Van Kampen Select Sector Municipal Trust
Tax Components
of Net Assets at Period-End:
|
|
|
|
|
|
|
February 29,
|
|
|
2012
|
|
Undistributed ordinary income
|
|
$
|
2,483,999
|
|
|
Net unrealized appreciation investments
|
|
|
20,211,336
|
|
|
Post-October deferrals
|
|
|
(1,846,511
|
)
|
|
Capital loss carryforward
|
|
|
(33,274,131
|
)
|
|
Shares of beneficial interest common shares
|
|
|
203,894,684
|
|
|
Total net assets applicable to common shares
|
|
$
|
191,469,377
|
|
|
The difference between book-basis and tax-basis
unrealized appreciation (depreciation) is due to differences in
the timing of recognition of gains and losses on investments for
tax and book purposes. The Trusts net unrealized
appreciation difference is attributable primarily to TOBs, book
to tax accretion and amortization differences, and defaulted
bonds.
The temporary book/tax differences are a result of
timing differences between book and tax recognition of income
and/or
expenses. The Funds temporary book/tax differences are the
result of the trustee deferral of compensation and retirement
plan benefits.
Capital loss carryforward is calculated and reported
as of a specific date. Results of transactions and other
activity after that date may affect the amount of capital loss
carryforward actually available for the Trust to utilize. The
Regulated Investment Company Modernization Act of 2010 (the
Act) eliminated the eight-year carryover period for
capital losses that arise in taxable years beginning after its
enactment date of December 22, 2010. Consequently, these
capital losses can be carried forward for an unlimited period.
However, capital losses with an expiration period may not be
used to offset capital gains until all net capital losses
without an expiration date have been utilized. Additionally,
post-enactment capital loss carryovers will retain their
character as either short-term or long-term capital losses
instead of as short-term capital losses as under prior law. The
ability to utilize capital loss carryforward in the future may
be limited under the Internal Revenue Code and related
regulations based on the results of future transactions.
The Trust has a capital loss carryforward as of
February 29, 2012, which expires as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital
Loss Carryforward*
|
Expiration
|
|
Short-Term
|
|
Long-Term
|
|
Total
|
|
February 28, 2015
|
|
$
|
1,589,212
|
|
|
$
|
|
|
|
$
|
1,589,212
|
|
|
February 29, 2016
|
|
|
15,442,819
|
|
|
|
|
|
|
|
15,442,819
|
|
|
February 28, 2017
|
|
|
11,235,010
|
|
|
|
|
|
|
|
11,235,010
|
|
|
February 28, 2018
|
|
|
2,913,579
|
|
|
|
|
|
|
|
2,913,579
|
|
|
February 28, 2019
|
|
|
485,791
|
|
|
|
|
|
|
|
485,791
|
|
|
No Expiration
|
|
|
|
|
|
|
1,607,720
|
|
|
|
1,607,720
|
|
|
|
|
$
|
31,666,411
|
|
|
$
|
1,607,720
|
|
|
$
|
33,274,131
|
|
|
|
|
*
|
Capital loss carryforward as of the
date listed above is reduced for limitations, if any, to the
extent required by the Internal Revenue Code.
|
NOTE 8Investment
Securities
The aggregate amount of investment securities (other than
short-term securities, U.S. Treasury obligations and money
market funds, if any) purchased and sold by the Trust during the
year ended February 29, 2012 was $42,034,677 and
$44,652,617, respectively. Cost of investments on a tax basis
includes the adjustments for financial reporting purposes as of
the most recently completed Federal income tax reporting
period-end.
|
|
|
|
|
Unrealized
Appreciation (Depreciation) of Investment Securities on a Tax
Basis
|
Aggregate unrealized appreciation of investment securities
|
|
$
|
22,517,377
|
|
|
Aggregate unrealized (depreciation) of investment securities
|
|
|
(2,306,041
|
)
|
|
Net unrealized appreciation of investment securities
|
|
$
|
20,211,336
|
|
|
Cost of investments for tax purposes is $298,675,244.
|
|
|
|
|
NOTE 9Reclassification
of Permanent Differences
Primarily as a result of differing book/tax treatment of taxable
income, on February 29, 2012, undistributed net investment
income was decreased by $56,197, undistributed net realized gain
(loss) was increased by $11,990 and shares of beneficial
interest was increased by $44,207. This reclassification had no
effect on the net assets of the Trust.
25 Invesco
Van Kampen Select Sector Municipal Trust
NOTE 10Common
Shares of Beneficial Interest
Transactions in common shares of beneficial interest were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Four months
|
|
|
|
|
Year ended
|
|
ended
|
|
Year ended
|
|
|
February 29,
|
|
February 28,
|
|
October 31,
|
|
|
2012
|
|
2011
|
|
2010
|
|
Beginning Shares
|
|
|
15,190,715
|
|
|
|
15,190,715
|
|
|
|
15,190,715
|
|
|
Shares Issued Through Dividend Reinvestment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending Shares
|
|
|
15,190,715
|
|
|
|
15,190,715
|
|
|
|
15,190,715
|
|
|
The Board of Trustees have approved share
repurchases whereby the Trust may, when appropriate, purchase
shares in the open market or in privately negotiated
transactions at a price not above market value or net asset
value, whichever is lower at the time of purchase.
NOTE 11Preferred
Shares of Beneficial Interest
The Trust has issued Auction Rate Preferred Shares
(preferred shares) which have a liquidation value of
$25,000 per share plus the redemption premium, if any, plus
accumulated but unpaid dividends, whether or not declared,
thereon to the date of distribution. The Trust may redeem such
shares, in whole or in part, at the original purchase price of
$25,000 per share plus accumulated but unpaid dividends, whether
or not declared, thereon to the date of redemption.
Historically, the Trust paid annual fees equivalent
to 0.25% of the preferred share liquidation value for the
remarketing efforts associated with the preferred auction.
Effective March 24, 2009, the Trust decreased this amount
to 0.15% due to auction failures. In the future, if auctions no
longer fail, the Trust may return to an annual fee payment of
0.25% of the preferred share liquidation value. These fees are
included as a component of Interest, facilities and
maintenance fees expense on the Statement of Operations.
Dividends, which are cumulative, are reset through
auction procedures.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amount
|
|
|
|
|
|
Range of
|
Series
|
|
Shares
|
|
(000s
omitted)
|
|
Rate
|
|
Reset
Date
|
|
Dividend
Rates
|
|
A
|
|
|
374
|
|
|
$
|
9,350
|
|
|
|
0.244
|
%
|
|
|
03/06/2012
|
|
|
|
0.107-0.411
|
%
|
|
B
|
|
|
374
|
|
|
|
9,350
|
|
|
|
0.274
|
|
|
|
03/20/2012
|
|
|
|
0.107-0.426
|
|
|
C
|
|
|
1,100
|
|
|
|
27,500
|
|
|
|
0.122
|
|
|
|
03/02/2012
|
|
|
|
0.107-0.411
|
|
|
D
|
|
|
990
|
|
|
|
24,750
|
|
|
|
0.122
|
|
|
|
03/05/2012
|
|
|
|
0.110-0.411
|
|
|
|
|
|
|
|
As of February 29, 2012.
|
|
|
For the year ended
February 29, 2012.
|
Subsequent to February 29, 2012 and up through
April 5, 2012, the Trust paid dividends to preferred
shareholders at rates ranging from 0.122% to 0.363% in the
aggregate amount of $15,913.
The Trust is subject to certain restrictions
relating to the preferred shares. Failure to comply with these
restrictions could preclude the Trust from declaring any
distributions to common shareholders or purchasing common shares
and/or
could
trigger the mandatory redemption of preferred shares at
liquidation value.
Beginning February 13, 2008 and continuing
through February 29, 2012, all series of preferred shares
of the Trust were not successfully remarketed. As a result, the
dividend rates of these preferred shares were reset to the
maximum applicable rate.
The preferred shares, which are entitled to one vote
per share, generally vote with the common shares but vote
separately as a class to elect two Trustees and on any matters
affecting the rights of the preferred shares.
The preferred shares are not listed on an exchange.
Investors in preferred shares may participate in auctions
through authorized broker-dealers; however, such broker-dealers
are not required to maintain a secondary market in preferred
shares, and there can be no assurance that a secondary market
will develop, or if it does develop, a secondary market may not
provide you with liquidity. When a preferred share auction
fails, investors may not be able to sell any or all of their
preferred shares and because of the nature of the market for
preferred shares, investors may receive less than the price paid
for their preferred shares if sold outside of the auction.
During the year ended February 29, 2012, the
Trust entered into additional floating rate notes as an
alternative form of leverage in order to redeem a portion of its
preferred shares. Transactions in preferred shares were as
follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Series
A
|
|
Series
B
|
|
Series
C
|
|
Series
D
|
|
|
Shares
|
|
Value
|
|
Shares
|
|
Value
|
|
Shares
|
|
Value
|
|
Shares
|
|
Value
|
|
Outstanding at February 28, 2011
|
|
|
442
|
|
|
$
|
11,050,000
|
|
|
|
442
|
|
|
$
|
11,050,000
|
|
|
|
1,300
|
|
|
$
|
32,500,000
|
|
|
|
1,170
|
|
|
$
|
29,250,000
|
|
|
Shares redeemed
|
|
|
(68
|
)
|
|
|
(1,700,000
|
)
|
|
|
(68
|
)
|
|
|
(1,700,000
|
)
|
|
|
(200
|
)
|
|
|
(5,000,000
|
)
|
|
|
(180
|
)
|
|
|
(4,500,000
|
)
|
|
Outstanding at February 29, 2012
|
|
|
374
|
|
|
$
|
9,350,000
|
|
|
|
374
|
|
|
$
|
9,350,000
|
|
|
|
1,100
|
|
|
$
|
27,500,000
|
|
|
|
990
|
|
|
$
|
24,750,000
|
|
|
26 Invesco
Van Kampen Select Sector Municipal Trust
NOTE 12Dividends
The Trust declared the following dividends to common
shareholders from net investment income subsequent to
February 29, 2012:
|
|
|
|
|
|
|
|
|
|
|
|
|
Declaration
Date
|
|
Amount Per
Share
|
|
Record
Date
|
|
Payable
Date
|
|
March 1, 2012
|
|
$
|
0.073
|
|
|
|
March 14, 2012
|
|
|
|
March 30, 2012
|
|
|
April 2, 2012
|
|
$
|
0.073
|
|
|
|
April 13, 2012
|
|
|
|
April 30, 2012
|
|
|
NOTE 13Financial
Highlights
The following schedule presents financial highlights for a share
of the Trust outstanding throughout the periods indicated.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended
|
|
Four months ended
|
|
|
|
|
|
|
|
|
|
|
February 29,
|
|
February 28,
|
|
Year ended
October 31,
|
|
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
|
Net asset value, beginning of period
|
|
$
|
10.97
|
|
|
$
|
12.24
|
|
|
$
|
11.47
|
|
|
$
|
9.41
|
|
|
$
|
13.68
|
|
|
$
|
14.54
|
|
|
Net investment
income
(a)
|
|
|
0.84
|
|
|
|
0.30
|
|
|
|
0.91
|
|
|
|
0.97
|
|
|
|
1.05
|
|
|
|
0.99
|
|
|
Net gains (losses) on securities (both realized and unrealized)
|
|
|
1.68
|
|
|
|
(1.27
|
)
|
|
|
0.75
|
|
|
|
1.88
|
|
|
|
(4.33
|
)
|
|
|
(0.86
|
)
|
|
Distributions paid to preferred shareholders from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net investment income
|
|
|
(0.01
|
)
|
|
|
(0.01
|
)
|
|
|
(0.02
|
)
|
|
|
(0.06
|
)
|
|
|
(0.30
|
)
|
|
|
(0.31
|
)
|
|
Total from investment operations
|
|
|
2.51
|
|
|
|
(0.98
|
)
|
|
|
1.64
|
|
|
|
2.79
|
|
|
|
(3.58
|
)
|
|
|
(0.18
|
)
|
|
Less distributions to common shareholders from:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Dividends from net investment income
|
|
|
(0.88
|
)
|
|
|
(0.29
|
)
|
|
|
(0.87
|
)
|
|
|
(0.73
|
)
|
|
|
(0.69
|
)
|
|
|
(0.68
|
)
|
|
Net asset value, end of period
|
|
$
|
12.60
|
|
|
$
|
10.97
|
|
|
$
|
12.24
|
|
|
$
|
11.47
|
|
|
$
|
9.41
|
|
|
$
|
13.68
|
|
|
Market value, end of period
|
|
$
|
13.11
|
|
|
$
|
11.00
|
|
|
$
|
12.83
|
|
|
$
|
10.84
|
|
|
$
|
9.20
|
|
|
$
|
12.19
|
|
|
Total return at net asset
value
(b)
|
|
|
23.59
|
%
|
|
|
(8.02
|
)%
|
|
|
14.58
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total return at market
value
(c)
|
|
|
28.24
|
%
|
|
|
(12.01
|
)%
|
|
|
27.08
|
%
|
|
|
27.20
|
%
|
|
|
(19.88
|
)%
|
|
|
0.66
|
%
|
|
Net assets applicable to common shares, end of period (000s
omitted)
|
|
$
|
191,469
|
|
|
$
|
166,660
|
|
|
$
|
185,869
|
|
|
$
|
174,205
|
|
|
$
|
142,947
|
|
|
$
|
209,917
|
|
|
Portfolio turnover
rate
(d)
|
|
|
14
|
%
|
|
|
2
|
%
|
|
|
12
|
%
|
|
|
17
|
%
|
|
|
55
|
%
|
|
|
23
|
%
|
|
Ratios/supplemental data based on average net assets applicable
to common shares:
|
Ratio of expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
With fee waivers
and/or
expense
reimbursements
(e)
|
|
|
1.31
|
%
(f)
|
|
|
1.36
|
%
(g)(h)
|
|
|
1.37
|
%
|
|
|
1.55
|
%
|
|
|
2.15
|
%
|
|
|
2.27
|
%
|
|
With fee waivers
and/or
expense reimbursements excluding interest, facilities and
maintenance
fees
(e)(i)
|
|
|
1.08
|
%
(f)
|
|
|
1.07
|
%
(g)(h)
|
|
|
1.16
|
%
|
|
|
1.20
|
%
|
|
|
1.04
|
%
|
|
|
1.06
|
%
|
|
Without fee waivers
and/or
expense
reimbursements
(e)
|
|
|
1.36
|
%
(f)
|
|
|
1.37
|
%
(g)(h)
|
|
|
1.47
|
%
|
|
|
1.74
|
%
|
|
|
2.32
|
%
|
|
|
2.41
|
%
|
|
Ratio of net investment income before preferred share dividends
|
|
|
7.15
|
%
(f)
|
|
|
8.07
|
%
(g)
|
|
|
7.65
|
%
|
|
|
9.59
|
%
|
|
|
8.52
|
%
|
|
|
6.96
|
%
|
|
Preferred share dividends
|
|
|
0.12
|
%
(f)
|
|
|
0.20
|
%
(g)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ratio of net investment income after preferred share dividends
|
|
|
7.03
|
%
(f)
|
|
|
7.87
|
%
(g)
|
|
|
7.46
|
%
|
|
|
9.00
|
%
|
|
|
6.09
|
%
|
|
|
4.79
|
%
|
|
Senior securities:
|
Total amount of preferred shares outstanding (000s omitted)
|
|
$
|
70,950
|
|
|
$
|
83,850
|
|
|
$
|
83,850
|
(j)
|
|
$
|
95,900
|
(j)
|
|
$
|
103,200
|
(j)
|
|
$
|
129,000
|
(j)
|
|
Asset coverage per preferred
share
(k)
|
|
$
|
92,466
|
|
|
$
|
74,690
|
|
|
$
|
80,422
|
|
|
$
|
70,418
|
|
|
$
|
59,684
|
|
|
$
|
65,715
|
|
|
Liquidating preference per preferred share
|
|
$
|
25,000
|
|
|
$
|
25,000
|
|
|
$
|
25,000
|
|
|
$
|
25,000
|
|
|
$
|
25,000
|
|
|
$
|
25,000
|
|
|
|
|
|
(a)
|
|
Calculated using average shares
outstanding.
|
(b)
|
|
Includes adjustments in accordance
with accounting principles generally accepted in the United
States of America and as such, the net asset value for financial
reporting purposes and the returns based upon those net asset
values may differ from the net asset value and returns for
shareholder transactions. Not annualized for periods less than
one year, if applicable.
|
(c)
|
|
Total return based on common share
market price assumes an investment at the common share market
price at the beginning of the period indicated, reinvestment of
all distributions for the period in accordance with the
Trusts dividend reinvestment plan, and sale of all shares
at the closing common share market price at the end of the
period indicated. Not annualized for periods less than one year,
if applicable.
|
(d)
|
|
Portfolio turnover is not
annualized for periods less than one year, if applicable.
|
(e)
|
|
Ratios do not reflect the effect of
dividend payments to auction rate preferred shareholders.
|
(f)
|
|
Ratios are based on average daily
net assets applicable to common shares (000s omitted) of
$177,451.
|
(g)
|
|
Annualized.
|
(h)
|
|
Ratios include an adjustment for a
change in accounting estimate for professional services fees
during the period. Ratios excluding this adjustment would have
been higher by 0.06%.
|
(i)
|
|
For the years ended
October 31, 2010 and prior, ratio does not exclude
facilities and maintenance fees.
|
(j)
|
|
Total shares outstanding for the
years ended October 31, 2010, 2009, 2008 and 2007 were
3,354, 3,836, 4,128 and 5,160, respectively.
|
(k)
|
|
Calculated by subtracting the
Trusts total liabilities (not including the preferred
shares) from the Trusts total assets and dividing this by
preferred shares outstanding.
|
27 Invesco
Van Kampen Select Sector Municipal Trust
NOTE 14Significant
Event
The Board of Trustees of the Trust (the Board)
approved the redomestication of the Trust, a Massachusetts
business trust, into a Delaware statutory trust pursuant to an
Agreement and Plan of Redomestication (the
Redomestication). The Board also approved an
Agreement and Plan of Merger pursuant to which the Trust would
merge with and into Invesco Van Kampen Municipal Opportunity
Trust (the Acquiring Trust) accordance with the
Delaware Statutory Trust Act (the Merger). As a
result of the Merger, all of the assets and liabilities of the
Trust will become assets and liabilities of the Acquiring Trust
and the Trusts shareholders will become shareholders of
the Acquiring Trust. The Redomestication and the Merger are
subject to shareholder approval.
In addition, the Board also approved a plan to
redeem all of the outstanding auction rate preferred shares at
their respective liquidation preferences. These redemptions are
anticipated to be funded with proceeds received from the
issuance of Variable Rate Munifund Term Preferred Shares
(VMTPS) and Tender Option Bonds (TOBs).
VMTPS are a variable rate form of preferred stock with a
mandatory redemption date. These redemptions and this issuance
of VMTPS are targeted to occur in the first half of 2012.
28 Invesco
Van Kampen Select Sector Municipal Trust
Report
of Independent Registered Public Accounting Firm
To the Board of Trustees and Shareholders of
Invesco Van Kampen Select Sector Municipal Trust:
In our opinion, the accompanying statement of assets and
liabilities, including the schedule of investments, and the
related statements of operations, of changes in net assets and
of cash flows and the financial highlights present fairly, in
all material respects, the financial position of Invesco Van
Kampen Select Sector Municipal Trust (hereafter referred to as
the Trust) at February 29, 2012, the results of
its operations and cash flows for the year then ended, and the
changes in its net assets and financial highlights for the year
then ended, the period ended February 28, 2011 and the year
ended October 31, 2010, in conformity with accounting
principles generally accepted in the United States of America.
These financial statements and financial highlights (hereafter
referred to as financial statements) are the
responsibility of the Trusts management. Our
responsibility is to express an opinion on these financial
statements based on our audits. We conducted our audits of these
financial statements in accordance with the standards of the
Public Company Accounting Oversight Board (United States). Those
standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in
the financial statements, assessing the accounting principles
used and significant estimates made by management, and
evaluating the overall financial statement presentation. We
believe that our audits, which included confirmation of
securities at February 29, 2012 by correspondence with the
custodian and brokers, provide a reasonable basis for our
opinion. The financial highlights of the Trust for the periods
ended October 31, 2009 and prior were audited by other
independent auditors whose report dated December 21, 2009
expressed an unqualified opinion on those financial statements.
PRICEWATERHOUSECOOPERS LLP
April 23, 2012
Houston, Texas
29 Invesco
Van Kampen Select Sector Municipal Trust
Tax
Information
Form 1099-DIV,
Form 1042-S
and other year-end tax information provide shareholders with
actual calendar year amounts that should be included in their
tax returns. Shareholders should consult their tax advisors.
The following distribution information is being
provided as required by the Internal Revenue Code or to meet a
specific states requirement.
The Trust designates the following amounts or, if
subsequently determined to be different, the maximum amount
allowable for its fiscal year ended February 29, 2012:
|
|
|
|
|
Federal and State Income
Tax
|
|
|
|
Qualified Dividend Income*
|
|
|
0%
|
|
Corporate Dividends Received Deduction*
|
|
|
0%
|
|
Tax-Exempt Interest Dividends*
|
|
|
99.53%
|
|
|
|
|
|
*
|
The above percentages are based on
ordinary income dividends paid to shareholders during the
Trusts fiscal year.
|
30 Invesco
Van Kampen Select Sector Municipal Trust
Supplemental
Information
The disclosure concerning the investment objective, principal
investment strategies and principal risks of Invesco Van Kampen
Select Sector Municipal Trust (the Fund) is being
updated. The investment objective has not changed; however the
Board of Trustees of the Fund approved a revised statement of
the principal investment strategies for the Fund. The revised
disclosure of the investment objective, principal investment
strategies and associated principal risks for the Fund is set
forth below.
Investment
Objective
The primary investment objective of Invesco Van Kampen Select
Sector Municipal Trust (the Fund) is to seek to
provide Common Shareholders with a high level of current income
exempt from federal income tax, consistent with preservation of
capital. The Funds secondary investment objective is to
seek to enhance the total return provided to Common Shareholders.
The investment objectives are fundamental and may
not be changed without approval of a majority of the Funds
outstanding voting securities, as defined in the Investment
Company Act of 1940, as amended (the 1940 Act).
Principal
Investment Strategies of the Fund
Under normal market conditions, at least 80% of the Funds
net assets will be invested in municipal securities. The policy
stated in the foregoing sentence is a fundamental policy of the
Fund and may not be changed without approval of a majority of
the Funds outstanding voting securities, as defined in the
1940 Act. Under normal market conditions, the Funds
investment adviser, Invesco Advisers, Inc. (the
Adviser), seeks to achieve the Funds
investment objective by investing at least 80% of the
Funds net assets in investment grade municipal securities.
Investment grade securities are: (i) securities rated BBB-
or higher by Standard & Poors Financial Services
LLC, a subsidiary of The McGraw-Hill Companies, Inc.
(S&P) or Baa3 or higher by Moodys
Investors Service, Inc. (Moodys) or an
equivalent rating by another nationally recognized statistical
rating organization (NRSRO), (ii) comparably
rated short term securities, or (iii) unrated municipal
securities determined by the Adviser to be of comparable quality
at the time of purchase. Under normal market conditions, the
Fund may invest up to 20% of its net assets in municipal
securities rated below investment grade or that are unrated but
determined by the Adviser to be of comparable quality at the
time of purchase. Lower-grade securities are commonly referred
to as junk bonds and involve greater risks than investments in
higher-grade securities. The Fund does not purchase securities
that are in default or rated in categories lower than B- by
S&P or B3 by Moodys or unrated securities of
comparable quality.
The foregoing percentage and rating limitations
apply at the time of acquisition of a security based on the last
previous determination of the Funds net asset value. Any
subsequent change in any rating by a rating service or change in
percentages resulting from market fluctuations or other changes
in the Funds total assets will not require elimination of
any security from the Funds portfolio.
Under current market conditions, the Adviser expects
to allocate the Funds investments in municipal securities
primarily among the transportation, local and state general
obligation, health care and utilities-related sectors of the
municipal securities market. The Adviser may from time to time
adjust the proportion of the Funds assets allocated among
these and other sectors of the municipal securities market based
upon its assessment of a variety of factors, including market
conditions, general economic conditions and political
considerations.
The Fund may invest all or a substantial portion of
its total assets in municipal securities that may subject
certain investors to the federal alternative minimum tax and,
therefore, a substantial portion of the income produced by the
Fund may be taxable for such investors under the federal
alternative minimum tax. Accordingly, the Fund may not be a
suitable investment for investors who are already subject to the
federal alternative minimum tax or could become subject to the
federal alternative minimum tax as a result of an investment in
the Fund.
The Adviser buys and sells securities for the Fund
with a view towards seeking a high level of current income
exempt from federal income taxes, subject to reasonable credit
risk. As a result, the Fund will not necessarily invest in the
highest yielding municipal securities permitted by its
investment policies if the Adviser determines that market risks
or credit risks associated with such investments would subject
the Funds portfolio to undue risk. The potential
realization of capital gains or losses resulting from possible
changes in interest rates will not be a major consideration and
frequency of portfolio turnover generally will not be a limiting
factor if the Adviser considers it advantageous to purchase or
sell securities.
The Adviser employs a
bottom-up,
research-driven approach to identify securities that have
attractive risk/reward characteristics for the sectors in which
the Fund invests. The Adviser also integrates macroeconomic
analysis and forecasting into its evaluation and ranking of
various sectors and individual securities. Finally, the Fund
employs leverage in an effort to enhance the Funds income
and total return. Sell decisions are based on: (i) a
deterioration or likely deterioration of an individual
issuers capacity to meet its debt obligations on a timely
basis; (ii) a deterioration or likely deterioration of the
broader fundamentals of a particular industry or sector; and
(iii) opportunities in the secondary or primary market to
purchase a security with better relative value.
Municipal Securities.
Municipal
securities are obligations issued by or on behalf of states,
territories or possessions of the United States, the District of
Columbia and their cities, counties, political subdivisions,
agencies and instrumentalities, the interest on which, in the
opinion of bond counsel or other counsel to the issuers of such
securities, is, at the time of issuance, exempt from federal
income tax. The Adviser does not conduct its own analysis of the
tax status of the interest paid by municipal securities held by
the Fund, but will rely on the opinion of counsel to the issuer
of each such instrument.
The issuers of municipal securities obtain funds for
various public purposes, including the construction of a wide
range of public facilities such as airports, highways, bridges,
schools, hospitals, housing, mass transportation, streets and
water and sewer works. Other public purposes for which municipal
securities may be issued include refunding outstanding
obligations, obtaining funds for general operating expenses and
obtaining funds to lend to other public institutions and
facilities. Certain types of municipal securities are issued to
obtain funding for privately operated facilities.
The yields of municipal securities depend on, among
other things, general money market conditions, general
conditions of the municipal securities market, size of a
particular offering, the maturity of the obligation and rating
of the issue. There is no limitation as to the maturity of the
municipal securities in which the Fund may invest. The ratings
of NRSROs represent their opinions of the quality of the
municipal securities they undertake to rate. These ratings are
general and are not absolute standards of quality. Consequently,
municipal securities with the same maturity, coupon and rating
may have different yields while municipal securities of the same
maturity and coupon with different ratings may have the same
yield.
31 Invesco
Van Kampen Select Sector Municipal Trust
The two principal classifications of municipal
securities are general obligation and revenue or special
delegation securities. General obligation securities are secured
by the issuers pledge of its faith, credit and taxing
power for the payment of principal and interest. Revenue
securities are usually payable only from the revenues derived
from a particular facility or class of facilities or, in some
cases, from the proceeds of a special excise tax or other
specific revenue source. Industrial development bonds are
usually revenue securities, the credit quality of which is
normally directly related to the credit standing of the
industrial user involved.
Within these principal classifications of municipal
securities, there are a variety of types of municipal
securities, including:
|
|
|
|
|
Variable rate securities, which bear rates of interest that are
adjusted periodically according to formulae intended to reflect
market rates of interest.
|
|
|
Municipal notes, including tax, revenue and bond anticipation
notes of short maturity, generally less than three years, which
are issued to obtain temporary funds for various public purposes.
|
|
|
Variable rate demand notes, which are obligations that contain a
floating or variable interest rate adjustment formula and which
are subject to a right of demand for payment of the principal
balance plus accrued interest either at any time or at specified
intervals. The interest rate on a variable rate demand note may
be based on a known lending rate, such as a banks prime
rate, and may be adjusted when such rate changes, or the
interest rate may be a market rate that is adjusted at specified
intervals. The adjustment formula maintains the value of the
variable rate demand note at approximately the par value of such
note at the adjustment date.
|
|
|
Municipal leases, which are obligations issued by state and
local governments or authorities to finance the acquisition of
equipment and facilities. Certain municipal lease obligations
may include non-appropriation clauses which provide that the
municipality has no obligation to make lease or installment
purchase payments in future years unless money is appropriated
for such purpose on a yearly basis.
|
|
|
Private activity bonds, which are issued by, or on behalf of,
public authorities to finance privately operated facilities.
|
|
|
Participation certificates, which are obligations issued by
state or local governments or authorities to finance the
acquisition of equipment and facilities. They may represent
participations in a lease, an installment purchase contract or a
conditional sales contract.
|
|
|
Municipal securities that may not be backed by the faith, credit
and taxing power of the issuer.
|
|
|
Municipal securities that are privately placed and that may have
restrictions on the Funds ability to resell, such as
timing restrictions or requirements that the securities only be
sold to qualified institutional investors.
|
|
|
Municipal securities that are insured by financial insurance
companies.
|
Select Sectors of
the Municipal Securities Market
The Fund will seek to achieve its investment objectives
primarily by investing in a portfolio of municipal securities
selected by the Adviser from those sectors of the municipal
securities market that, in the opinion of the Adviser, offer a
significant opportunity for a high level of current income
exempt from federal income tax without undue risk to income or
principal. The Advisers investment approach with respect
to the Fund is to identify those sectors of the municipal
securities market that the Adviser believes are undervalued and,
within those sectors, to select individual municipal securities
that are consistent with the Funds investment objectives.
The Adviser believes that securities in undervalued sectors of
the municipal securities market generally offer a higher yield
than comparable municipal securities in more fully valued
sectors of the municipal securities market. Investment in
undervalued sectors of the municipal securities market also
presents the opportunity for capital gains as the sector becomes
more fully valued. Certain sectors of the municipal securities
market may from time to time be undervalued due to such factors
as: excess supply occasioned by concurrent, large scale capital
intensive projects, refinancings and fiscal or tax driven
offering schedules; political, regulatory, and economic
developments; and investor perception. The Adviser seeks to take
advantage of such opportunities by allocating a significant
portion of the Funds assets to such sectors and by seeking
to minimize risk to income and principal through extensive
credit research and by investing substantially all of its total
assets in investment grade rated securities.
Under current market conditions, the Adviser expects
to allocate the Funds investments in municipal securities
primarily among the transportation, local and state general
obligation, health care and utilities related sectors of the
municipal securities market. The Adviser may from time to time
adjust the proportion of the Funds assets allocated among
these and other sectors of the municipal securities market.
Subject to the Funds policies with respect to investment
in any single industry and investment in securities rated below
investment grade, there is no limit on the percentage of the
Funds total assets that may be invested in municipal
securities relating to any particular sector of the municipal
securities market.
Transportation.
The transportation
sector of the municipal securities market includes airports,
highway, bridge and toll road facilities and public
transportation and port authorities. Many airport and toll road
facility securities are backed exclusively by the revenues of
particular projects whereas public highway, bridge and public
transportation and port authority securities often are backed at
least in part by more diverse revenue sources, such as gasoline
taxes and vehicle registration fees, sales taxes and revenues
and special taxes from nontransportation related activities.
Investor perception of many municipal securities in the
transportation sector may be influenced adversely by the
financial difficulties experienced by some domestic airlines.
The credit quality of individual airlines does not, however, in
the view of the Adviser, necessarily directly correlate with the
investment merits of any given security in the transportation
sector. The Adviser believes that the potential for increased
supply together with adverse investor perception create
attractive investment opportunities in the transportation sector
of the municipal securities market.
Local and State General Obligation.
The
general obligation sector of the municipal securities market
includes securities issued by states, counties, cities, towns
and school districts secured by the municipal issuers
general taxing powers. In general, a general obligation security
is secured by the issuers unlimited taxing power. For
smaller governmental jurisdictions such as cities, school
districts and towns, the only available unlimited taxing power
is on property. For larger municipal issuers such as states,
counties and larger cities, the available tax revenues are more
diverse and may include sales and income taxes along with
property taxes. Not all general obligation securities are
secured by an unlimited taxing power. Some issuers, generally
smaller municipal governments, pledge taxes that are limited as
to revenue sources and the maximum property tax millage amounts.
These securities are usually referred to as limited-tax general
obligation securities.
Health Care.
The health care sector of
the municipal securities market includes hospitals, nursing
homes, mental health care facilities, rehabilitation centers and
other public, non-profit, or similar entities principally
engaged in providing services for the treatment or prevention of
diseases, disorders or other medical
32 Invesco
Van Kampen Select Sector Municipal Trust
conditions. Changes in government regulation could have an
adverse impact upon such entities growth and
profitability. In addition, continuing technological advances
may mean rapid obsolescence of products and services.
Utilities.
The utilities sector of the
municipal securities market includes electric utilities, water
and sewage utilities, gas utilities and other entities engaged
in the provision of other utility or utility related goods or
services. Securities in the utilities sector of the municipal
securities market may be issued by state and local
government-owned entities, utility districts, rural cooperatives
and joint-action agencies and other governmental subdivisions,
agencies and instrumentalities and certain non-governmental,
investor-owned entities. Governmental regulation, prices of
fuel, availability of natural gas, risks associated with power
marketing and trading and risks associated with nuclear power
facilities may adversely affect the value of each Funds
securities. The trend toward deregulation in the utility
industry presents special risks. Some companies may be faced
with increased competition, which may affect the utilities
sector of the municipal securities market.
Other Sectors.
As discussed above, in
pursuing the Funds investment objectives, the Adviser may
from time to time adjust the proportion of the Funds
assets allocated among the foregoing and other sectors of the
municipal securities market based upon the Advisers
assessment of a variety of factors. Such other sectors, as
determined by the Adviser, will not necessarily correspond to
traditional industry categories and may include, among other
sectors, the education, insured and credit enhanced, special
district, lower-grade and various geographic (such as particular
regions or individual states) sectors of the municipal
securities market.
The education sector of the municipal securities
market includes educational institutions, such as colleges and
universities, and student loan securities. Student loan
securities are backed by the interest and principal payments on
student loans, and in some instances, interest subsidies and
special allowance payments from the federal government.
Educational institution securities may be backed by the revenues
of particular facilities or activities, tuition and fees or the
general obligation of the institution.
The insured and credit enhanced sector of the
municipal securities market includes municipal securities backed
by original issue insurance or secondary market insurance or by
some other form of credit support, such as a letter of credit or
a mandatory purchase facility. Such insurance generally insures
the timely payment of scheduled interest and principal payments.
Other types of credit enhancement may provide only for the
ultimate payment of interest or principal, or may simply provide
a liquidity facility for the disposition of securities.
The special district sector of the municipal
securities market includes special purpose municipal entities
issuing securities payable from the revenues generated from a
particular activity, fee or assessment or payable from a limited
taxing authority.
Derivatives.
The Fund may use derivative
instruments for a variety of purposes, including hedging, risk
management or portfolio management, and (other than futures and
swaps) to earn income. Derivatives are financial instruments
whose value is based on the value of another underlying asset,
interest rate, index or financial instrument. Derivative
instruments and techniques that the Fund may principally use
include:
Futures.
A futures contract is a
standardized agreement between two parties to buy or sell a
specific quantity of an underlying instrument at a specific
price at a specific future time. The value of a futures contract
tends to increase and decrease in tandem with the value of the
underlying instrument. Futures contracts are bilateral
agreements, with both the purchaser and the seller equally
obligated to complete the transaction. Depending on the terms of
the particular contract, futures contracts are settled through
either physical delivery of the underlying instrument on the
settlement date or by payment of a cash settlement amount on the
settlement date.
Swaps.
A swap contract is an agreement
between two parties pursuant to which the parties exchange
payments at specified dates on the basis of a specified notional
amount, with the payments calculated by reference to specified
securities, indexes, reference rates, currencies or other
instruments. Most swap agreements provide that when the period
payment dates for both parties are the same, the payments are
made on a net basis (i.e., the two payment streams are netted
out, with only the net amount paid by one party to the other).
The Funds obligations or rights under a swap contract
entered into on a net basis will generally be equal only to the
net amount to be paid or received under the agreement, based on
the relative values of the positions held by each counterparty.
Inverse Floating Rate Obligations.
The
Fund may invest in inverse floating rate obligations. Inverse
floating rate obligations are variable rate debt instruments
that pay interest at rates that move in the opposite direction
of prevailing interest rates. Because the interest rate paid to
holders of such obligations is generally determined by
subtracting a variable or floating rate from a predetermined
amount, the interest rate paid to holders of such obligations
will decrease as such variable or floating rate increases and
increase as such variable or floating rate decreases. The
inverse floating rate obligations in which the Fund may invest
include derivative instruments such as residual interest bonds
(RIBs) or tender option bonds (TOBs).
Such instruments are typically created by a special purpose
trust that holds long-term fixed rate bonds and sells two
classes of beneficial interests: short-term floating rate
interests, which are sold to third party investors, and inverse
floating residual interests, which are purchased by the Fund.
The short-term floating rate interests have first priority on
the cash flow from the bond held by the special purpose trust
and the Fund (as holder of the inverse floating residual
interests) is paid the residual cash flow from the bond held by
the special purpose trust.
When-Issued and Delayed Delivery
Transactions.
The Fund may purchase and sell securities
on a when-issued and delayed delivery basis, which means that
the Fund buys or sells a security with payment and delivery
taking place in the future. The payment obligation and the
interest rate are fixed at the time the Fund enters into the
commitment. No income accrues on such securities until the date
the Fund actually takes delivery of the securities.
Preferred Shares.
The Fund uses leverage
in the form of Preferred Shares. Dividends on the Preferred
Shares will typically be comparable to the yields on investment
grade short-term municipal securities, although the assets
attributable to the Preferred Shares will generally be invested
in longer-term municipal securities, which typically have higher
yields than short-term municipal securities. Assuming such a
yield differential, this leveraged capital structure enables the
Fund to pay a potentially higher yield on the Common Shares than
similar investment companies that do not use leverage.
The Fund will generally maintain an asset coverage
of the value of the Funds total assets, less all
liabilities and indebtedness of the Fund not represented by the
Preferred Shares, of 200% of the aggregate liquidation value of
the Preferred Shares. The liquidation value of the Preferred
Shares is their aggregate original purchase price, plus any
accrued and unpaid dividends.
Portfolio Turnover.
The Fund generally
will not engage in the trading of securities for the purpose of
realizing short-term profits, but it will adjust its portfolio
as it deems advisable in view of prevailing or anticipated
market conditions to accomplish the Funds investment
objective. For example, the Fund may sell portfolio securities
in anticipation of a movement in interest rates. Other than for
tax purposes, frequency of portfolio turnover will not be a
limiting factor
33 Invesco
Van Kampen Select Sector Municipal Trust
if the Fund considers it advantageous to purchase or sell
securities. The Fund does not anticipate that the annual
portfolio turnover rate of the Fund will be in excess of 100%. A
high rate of portfolio turnover involves correspondingly greater
brokerage commission and transaction expenses than a lower rate,
which expenses must be borne by the Fund and its shareholders.
High portfolio turnover may also result in the realization of
substantial net short-term capital gains, and any distributions
resulting from such gains will be taxable at ordinary income
rates for federal income tax. purposes.
Temporary Defensive Strategy.
When
market conditions dictate a more defensive investment strategy,
the Fund may, on a temporary basis, hold cash or invest a
portion or all of its assets in high-quality, short-term
municipal securities. If such municipal securities are not
available or, in the judgment of the Adviser, do not afford
sufficient protection against adverse market conditions, the
Fund may invest in taxable instruments. Such taxable securities
may include securities issued or guaranteed by the
U.S. government, its agencies or instrumentalities, other
investment grade quality fixed income securities, prime
commercial paper, certificates of deposit, bankers
acceptances and other obligations of domestic banks, repurchase
agreements and money market funds (including money market funds
affiliated with the Adviser). In taking a defensive position,
the Fund would temporarily not be pursuing its principal
investment strategies and may not achieve its investment
objective.
Zero Coupon/PIK Bonds.
The Fund may
invest in securities not producing immediate cash income,
including zero coupon securities or
pay-in-kind
(PIK) securities, when their effective yield over
comparable instruments producing cash income makes these
investments attractive. PIK securities are debt securities that
pay interest through the issuance of additional securities. Zero
coupon securities are debt securities that do not entitle the
holder to any periodic payment of interest prior to maturity or
a specified date when the securities begin paying current
interest. They are issued and traded at a discount from their
face amounts or par value, which discount varies depending on
the time remaining until cash payments begin, prevailing
interest rates, liquidity of the security and the perceived
credit quality of the issuer. The securities do not entitle the
holder to any periodic payments of interest prior to maturity,
which prevents any reinvestment of interest payments at
prevailing interest rates if prevailing interest rates rise. On
the other hand, because there are no periodic interest payments
to be reinvested prior to maturity, zero coupon securities
eliminate the reinvestment risk and may lock in a favorable rate
of return to maturity if interest rates drop. In addition, the
Fund would be required to distribute the income on these
instruments as it accrues, even though the Fund will not receive
all of the income on a current basis or in cash. Thus, the Fund
may have to sell other investments, including when it may not be
advisable to do so, to make income distributions to the Common
Shareholders.
Principal Risks
of Investing in the Fund
As with any fund investment, loss of money is a risk of
investing. An investment in the Fund is not a deposit in a bank
and is not insured or guaranteed by the Federal Deposit
Insurance Corporation or any other government agency. As with
any managed fund, the Adviser may not be successful in selecting
the best-performing securities or investment techniques, and the
Funds performance may lag behind that of similar funds.
The risks associated with an investment in the Fund can increase
during times of significant market volatility.
Municipal Securities Risk.
Under normal
market conditions, longer-term municipal securities generally
provide a higher yield than shorter-term municipal securities.
The Adviser may adjust the average maturity of the Funds
portfolio from time to time depending on its assessment of the
relative yields available on securities of different maturities
and its expectations of future changes in interest rates. The
yields of municipal securities may move differently and
adversely compared to the yields of the overall debt securities
markets. Certain kinds of municipal securities are subject to
specific risks that could cause a decline in the value of those
securities:
Lease Obligations.
Certain lease
obligations contain non-appropriation clauses that provide that
the governmental issuer has no obligation to make future
payments under the lease or contract unless money is
appropriated for that purpose by the appropriate legislative
body on an annual or other periodic basis. Consequently,
continued lease payments on those lease obligations containing
non-appropriation clauses are dependent on future legislative
actions. If these legislative actions do not occur, the holders
of the lease obligation may experience difficulty in exercising
their rights, including disposition of the property.
Private Activity Bonds.
The issuers of
private activity bonds in which the Fund may invest may be
negatively impacted by conditions affecting either the general
credit of the user of the private activity project or the
project itself. Conditions such as regulatory and environmental
restrictions and economic downturns may lower the need for these
facilities and the ability of users of the project to pay for
the facilities. Private activity bonds may also pay interest
subject to the alternative minimum tax.
In 2011, S&P lowered its long-term sovereign
credit rating on the U.S. to AA+ from
AAA with a negative outlook. Following
S&Ps downgrade of the long-term sovereign credit
rating on the U.S., the major rating agencies have also placed
many municipalities on review for potential downgrades, which
could impact the market price, liquidity and volatility of the
municipal securities held by the Fund in its portfolio. If the
universe of municipal securities meeting the Funds ratings
and credit quality requirements shrinks, it may be more
difficult for the Fund to meet its investment objectives and the
Funds investments may become more concentrated in fewer
issues. Future downgrades by other rating agencies could have
significant adverse effects on the economy generally and could
result in significant adverse impacts on municipal issuers and
the Fund.
Many state and municipal governments that issue
securities are under significant economic and financial stress
and may not be able to satisfy their obligations. In response to
the national economic downturn, governmental cost burdens have
been and may continue to be reallocated among federal, state and
local governments. The ability of municipal issuers to make
timely payments of interest and principal may be diminished
during general economic downturns and as governmental cost
burdens are reallocated among federal, state and local
governments. Also, as a result of the downturn and related
unemployment, declining income and loss of property values, many
state and local governments have experienced significant
reductions in revenues and consequently difficulties meeting
ongoing expenses. As a result, certain of these state and local
governments may have difficulty paying or default in the payment
of principal or interest on their outstanding debt, may
experience ratings downgrades of their debt. The taxing power of
any governmental entity may be limited by provisions of state
constitutions or laws and an entitys credit will depend on
many factors, including the entitys tax base, the extent
to which the entity relies on federal or state aid, and other
factors which are beyond the entitys control. In addition,
laws enacted in the future by Congress or state legislatures or
referenda could extend the time for payment of principal
and/or
interest, or impose other constraints on enforcement of such
obligations or on the ability of municipalities to levy taxes.
In addition, municipalities might seek protection
under the bankruptcy laws, thereby affecting the repayment of
their outstanding debt. Issuers of municipal securities might
seek protection under the bankruptcy laws. In the event of
bankruptcy of such an issuer, holders of municipal securities
could experience delays
34 Invesco
Van Kampen Select Sector Municipal Trust
in collecting principal and interest and such holders may not be
able to collect all principal and interest to which they are
entitled. Certain provisions of the U.S. Bankruptcy Code
governing such bankruptcies are unclear. Further, the
application of state law to municipal securities issuers could
produce varying results among the states or among municipal
securities issuers within a state. These uncertainties could
have a significant impact on the prices of the municipal
securities in which the Fund invests. The value of municipal
securities generally may be affected by uncertainties in the
municipal markets as a result of legislation or litigation,
including legislation or litigation that changes the taxation of
municipal securities or the rights of municipal securities
holders in the event of a bankruptcy. To enforce its rights in
the event of a default in the payment of interest or repayment
of principal, or both, the Fund may take possession of and
manage the assets securing the issuers obligations on such
securities, which may increase the Funds operating
expenses. Any income derived from the Funds ownership or
operation of such assets may not be tax-exempt and could
jeopardize the Funds status as a regulated investment
company under the Internal Revenue Code.
The U.S. economy may be in the process of
deleveraging, with individuals, companies and
municipalities reducing expenditures and paying down borrowings.
In such event, the number of municipal borrowers and the amount
of outstanding municipal securities may contract, potentially
without corresponding reductions in investor demand for
municipal securities. As a result, the Fund may have fewer
investment alternatives, may invest in securities that it
previously would have declined and may concentrate its
investments in a smaller number of issuers.
Insurance Risk.
Financial insurance
guarantees that interest payments on a bond will be made on time
and that principal will be repaid when the bond matures. Insured
municipal obligations would generally be assigned a lower rating
if the rating were based primarily on the credit quality of the
issuer without regard to the insurance feature. If the
claims-paying ability of the insurer were downgraded, the
ratings on the municipal obligations it insures may also be
downgraded. Insurance does not protect the Fund against losses
caused by declines in a bonds value due to a change in
market conditions.
Market Risk.
Market risk is the
possibility that the market values of securities owned by the
Fund will decline. The net asset value of the Fund will change
with changes in the value of its portfolio securities, and the
value of the Funds investments can be expected to
fluctuate over time. The financial markets in general are
subject to volatility and may at times experience extreme
volatility and uncertainty, which may affect all investment
securities, including debt securities and derivative
instruments. Volatility may be greater during periods of general
economic uncertainty.
Interest Rate Risk.
Because the Fund
invests primarily in fixed income municipal securities, the net
asset value of the Fund can be expected to change as general
levels of interest rates fluctuate. When interest rates decline,
the value of a portfolio invested in fixed income securities
generally can be expected to rise. Conversely, when interest
rates rise, the value of a portfolio invested in fixed income
securities generally can be expected to decline. The prices of
longer term municipal securities generally are more volatile
with respect to changes in interest rates than the prices of
shorter term municipal securities. These risks may be greater in
the current market environment because certain interest rates
are near historically low levels.
Credit Risk.
Credit risk refers to an
issuers ability to make timely payments of interest and
principal when due. Municipal securities, like other debt
obligations, are subject to the credit risk of nonpayment. The
ability of issuers of municipal securities to make timely
payments of interest and principal may be adversely affected by
general economic downturns and as relative governmental cost
burdens are allocated and reallocated among federal, state and
local governmental units. Private activity bonds used to finance
projects, such as industrial development and pollution control,
may also be negatively impacted by the general credit of the
user of the project. Nonpayment would result in a reduction of
income to the Fund, and a potential decrease in the net asset
value of the Fund. The Adviser continuously monitors the issuers
of securities held in the Fund.
The Fund will rely on the Advisers judgment,
analysis and experience in evaluating the creditworthiness of an
issuer. In its analysis, the Adviser may consider the credit
ratings of NRSROs in evaluating securities, although the Adviser
does not rely primarily on these ratings. Credit ratings of
NRSROs evaluate only the safety of principal and interest
payments, not the market risk. In addition, ratings are general
and not absolute standards of quality, and the creditworthiness
of an issuer may decline significantly before an NRSRO lowers
the issuers rating. A rating downgrade does not require
the Fund to dispose of a security.
Medium-grade obligations (for example, bonds rated
BBB by S&P) possess speculative characteristics so that
changes in economic conditions or other circumstances are more
likely to lead to a weakened capacity of the issuer to make
principal and interest payments than in the case of higher-rated
securities. Securities rated below investment grade are
considered speculative by NRSROs with respect to the
issuers continuing ability to pay interest and principal.
Income Risk.
The income you receive from
the Fund is based primarily on prevailing interest rates, which
can vary widely over the short and long term. If interest rates
decrease, your income from the Fund may decrease as well.
Call Risk.
If interest rates fall, it is
possible that issuers of securities with high interest rates
will prepay or call their securities before their maturity
dates. In this event, the proceeds from the called securities
would likely be reinvested by the Fund in securities bearing the
new, lower interest rates, resulting in a possible decline in
the Funds income and distributions to shareholders.
Market Sector Risk.
The Fund generally
considers investments in municipal securities issued by
governments or political subdivisions not to be subject to
industry concentration policies (because such issuers are not in
any industry). The Fund may, however, invest in municipal
securities issued by entities having similar characteristics.
For example, the issuers may be located in the same geographic
area or may pay their interest obligations from revenue of
similar projects, such as hospitals, airports, utility systems
and housing finance agencies. This may make the Funds
investments more susceptible to similar economic, political or
regulatory occurrences, which could increase the volatility of
the Funds net asset value. The Fund may invest more than
25% of its total assets in one or more sectors of the municipal
securities market with similar characteristics if the Adviser
determines that the yields available from obligations in one or
more particular sectors justify the additional risks of a larger
investment in that sector. The Fund may not, however, invest
more than 25% of its total assets in municipal securities, such
as many private activity bonds or industrial development revenue
bonds, issued for non-governmental entities that are in the same
industry.
Under current market conditions, the Adviser expects
to allocate the Funds investments in municipal securities
primarily among the transportation, local and state general
obligation, health care and utilities related sectors of the
municipal securities market. To the extent the Funds
portfolio is allocated to a particular sector or sectors of the
municipal securities market, negative market, economic,
business, political, regulatory or other developments generally
affecting issuers in those sectors of the municipal securities
market will have a greater impact on the Fund than an investment
company that is more widely diversified and that is not
over-weighted in those sectors.
35 Invesco
Van Kampen Select Sector Municipal Trust
The Fund has no policy limiting its investments in
municipal securities whose issuers are located in the same
state. If the Fund were to invest a significant portion of its
total assets in issuers located in the same state, it would be
more susceptible to adverse economic, business or regulatory
conditions in that state.
Tax Risk.
To qualify for the favorable
U.S. federal income tax treatment generally accorded to
regulated investment companies, among other things, the Fund
must derive in each taxable year at least 90% of its gross
income from certain prescribed sources. If for any taxable year
the Fund does not qualify as a regulated investment company, all
of its taxable income (including its net capital gain) would be
subject to federal income tax at regular corporate rates without
any deduction for distributions to shareholders, and all
distributions from the Fund (including underlying distributions
attributable to tax exempt interest income) would be taxable to
shareholders as ordinary dividends to the extent of the
Funds current and accumulated earnings and profits.
The value of the Funds investments and its net
asset value may be adversely affected by changes in tax rates
and policies. Because interest income from municipal securities
is normally not subject to regular federal income taxation, the
attractiveness of municipal securities in relation to other
investment alternatives is affected by changes in federal income
tax rates or changes in the tax-exempt status of interest income
from municipal securities. Any proposed or actual changes in
such rates or exempt status, therefore, can significantly affect
the demand for and supply, liquidity and marketability of
municipal securities. This could in turn affect the Funds
net asset value and ability to acquire and dispose of municipal
securities at desirable yield and price levels. Additionally,
the Fund may not be a suitable investment for individual
retirement accounts, for other tax-exempt or tax-deferred
accounts or for investors who are not sensitive to the federal
income tax consequences of their investments.
The Fund may invest all or a substantial portion of
its total assets in municipal securities subject to the federal
alternative minimum tax. Accordingly, an investment in the Fund
could cause shareholders to be subject to (or result in an
increased liability under) the federal alternative minimum tax.
As a result, the Fund may not be a suitable investment for
investors who are already subject to the federal alternative
minimum tax or who could become subject to the federal
alternative minimum tax as a result of an investment in the Fund.
Subsequent to the Funds acquisition of a
municipal security, the security may be determined to pay, or to
have paid, taxable income. As a result, the treatment of
dividends previously paid or to be paid by the Fund as
exempt-interest dividends could be adversely
affected, subjecting the Funds shareholders to increased
federal income tax liabilities.
For federal income tax purposes, distributions of
ordinary taxable income (including any net short-term capital
gain) will be taxable to shareholders as ordinary income (and
not eligible for favorable taxation as qualified dividend
income), and capital gain dividends will be taxed at
long-term capital gain rates. In certain circumstances, the Fund
will make payments to holders of Preferred Shares to offset the
tax effects of a taxable distribution.
Generally, to the extent the Funds
distributions are derived from interest on municipal securities
of a particular state (and, in some cases qualifying obligations
of U.S. territories and possessions), its distributions are
exempt from the personal income tax of that state. In some
cases, the Funds shares may (to the extent applicable)
also be exempt from personal property taxes of such state.
However, some states require that the Fund meet certain
thresholds with respect to the portion of its portfolio
consisting of municipal securities of such state in order for
such exemption to apply.
Risks of Using Derivative Instruments.
A
derivative instrument often has risks similar to its underlying
instrument and may have additional risks, including imperfect
correlation between the value of the derivative and the
underlying instrument or instrument being hedged, risks of
default by the other party to certain transactions,
magnification of losses incurred due to changes in the market
value of the securities, instruments, indices or interest rates
to which they relate, and risks that the derivatives may not be
liquid. The use of derivatives involves risks that are different
from, and potentially greater than, the risks associated with
other portfolio investments. Derivatives may involve the use of
highly specialized instruments that require investment
techniques and risk analyses different from those associated
with other portfolio investments. Certain derivative
transactions may give rise to a form of leverage. Leverage
associated with derivative transactions may cause the Fund to
liquidate portfolio positions when it may not be advantageous to
do so to satisfy its obligations or to meet earmarking or
segregation requirements, pursuant to applicable SEC rules and
regulations, or may cause the Fund to be more volatile than if
the Fund had not been leveraged. The Fund could suffer losses
related to its derivative positions as a result of unanticipated
market movements, which losses may potentially be unlimited.
Although the Adviser may seek to use derivatives to further the
Funds investment objective, the Fund is not required to
use derivatives and may choose not to do so and there is no
assurance that the use of derivatives will achieve this result.
Counterparty Risk.
The Fund will be
subject to credit risk with respect to the counterparties to the
derivative transactions entered into by the Fund. If a
counterparty becomes bankrupt or otherwise fails to perform its
obligations under a derivative contract due to financial
difficulties, the Fund may experience significant delays in
obtaining any recovery under the derivative contract in
bankruptcy or other reorganization proceeding. The Fund may
obtain only a limited recovery or may obtain no recovery in such
circumstances.
Futures Risk.
A decision as to whether,
when and how to use futures involves the exercise of skill and
judgment and even a well-conceived futures transaction may be
unsuccessful because of market behavior or unexpected events. In
addition to the derivatives risks discussed above, the prices of
futures can be highly volatile, using futures can lower total
return, and the potential loss from futures can exceed the
Funds initial investment in such contracts.
Swaps Risk.
Swap agreements are not
entered into or traded on exchanges and there is no central
clearing or guaranty function for swaps. Therefore, swaps are
subject to credit risk or the risk of default or non-performance
by the counterparty. Swaps could result in losses if interest
rate or credit quality changes are not correctly anticipated by
the Fund or if the reference index, security or investments do
not perform as expected.
Tax Risk.
The use of derivatives may
generate taxable income. In addition, the Funds use of
derivatives may be limited by the requirements for taxation as a
regulated investment company or the Funds intention to pay
dividends that are exempt from federal income taxes. The tax
treatment of derivatives may be adversely affected by changes in
legislation, regulations or other legal authority, subjecting
the Funds shareholders to increased federal income tax
liabilities.
Inverse Floating Rate Obligations
Risk
.
Like most other fixed-income
securities, the value of inverse floating rate obligations will
decrease as interest rates increase. They are more volatile,
however, than most other fixed-income securities because the
coupon rate on an inverse floating rate obligation typically
changes at a multiple of the change in the relevant index rate.
Thus, any rise in the index rate (as a consequence of an
increase in interest rates) causes a correspondingly greater
drop in the coupon rate of an inverse floating rate obligation
while a drop in the index rate causes a correspondingly greater
increase in the coupon of an inverse floating rate obligation.
Some inverse floating rate obligations may also increase or
decrease substantially because of changes in the rate of
prepayments. Inverse floating rate obligations tend to
underperform the market for fixed rate bonds in a rising
interest rate environment, but tend to
36 Invesco
Van Kampen Select Sector Municipal Trust
outperform the market for fixed rate bonds when interest rates
decline or remain relatively stable. Inverse floating rate
obligations have varying degrees of liquidity.
The Fund generally invests in inverse floating rate
obligations that include embedded leverage, thus exposing the
Fund to greater risks and increased costs. The market value of a
leveraged inverse floating rate obligations
generally will fluctuate in response to changes in market rates
of interest to a greater extent than the value of an unleveraged
investment. The extent of increases and decreases in the value
of inverse floating rate obligations generally will be larger
than changes in an equal principal amount of a fixed rate
security having similar credit quality, redemption provisions
and maturity, which may cause the Funds net asset value to
be more volatile than if it had not invested in inverse floating
rate obligations.
In certain instances, the short-term floating rate
interests created by a special purpose trust may not be able to
be sold to third parties or, in the case of holders tendering
(or putting) such interests for repayment of principal, may not
be able to be remarketed to third parties. In such cases, the
special purpose trust holding the long-term fixed rate bonds may
be collapsed. In the case of inverse floating rate obligations
created by the Fund, the Fund would then be required to repay
the principal amount of the tendered securities. During times of
market volatility, illiquidity or uncertainty, the Fund could be
required to sell other portfolio holdings at a disadvantageous
time to raise cash to meet that obligation.
The use of short-term floating rate obligations may
require the Fund to segregate or earmark cash or liquid assets
to cover its obligations. Securities so segregated or earmarked
will be unavailable for sale by the Fund (unless replaced by
other securities qualifying for segregation requirements), which
may limit the Funds flexibility and may require that the
Fund sell other portfolio investments at a time when it may be
disadvantageous to sell such assets.
Risks of Investing in Lower-Grade
Securities.
Securities that are in the lower-grade
categories generally offer higher yields than are offered by
higher-grade securities of similar maturities, but they also
generally involve greater risks, such as greater credit risk,
market risk, volatility and liquidity risk. In addition, the
amount of available information about the financial condition of
certain lower-grade issuers may be less extensive than other
issuers, making the Fund more dependent on the Advisers
credit analysis than a fund investing only in higher-grade
securities. To minimize the risks involved in investing in
lower-grade securities, the Fund does not purchase securities
that are in default or rated in categories lower than B- by
S&P or B3 by Moodys or unrated securities of
comparable quality.
Secondary market prices of lower-grade securities
generally are less sensitive than higher-grade securities to
changes in interest rates and are more sensitive to general
adverse economic changes or specific developments with respect
to the particular issuers. A significant increase in interest
rates or a general economic downturn may significantly affect
the ability of municipal issuers of lower-grade securities to
pay interest and to repay principal, or to obtain additional
financing, any of which could severely disrupt the market for
lower-grade municipal securities and adversely affect the market
value of such securities. Such events also could lead to a
higher incidence of default by issuers of lower-grade
securities. In addition, changes in credit risks, interest
rates, the credit markets or periods of general economic
uncertainty can be expected to result in increased volatility in
the price of the lower-grade securities and the net asset value
of the Fund. Adverse publicity and investor perceptions, whether
or not based on rational analysis, may affect the value,
volatility and liquidity of lower-grade securities.
In the event that an issuer of securities held by
the Fund experiences difficulties in the timely payment of
principal and interest and such issuer seeks to restructure the
terms of its borrowings, the Fund may incur additional expenses
and may determine to invest additional assets with respect to
such issuer or the project or projects to which the Funds
securities relate. Further, the Fund may incur additional
expenses to the extent that it is required to seek recovery upon
a default in the payment of interest or the repayment of
principal on its portfolio holdings and the Fund may be unable
to obtain full recovery on such amounts.
Investments in debt obligations that are at risk of
or in default present special tax issues for the Fund. Federal
income tax rules are not entirely clear about issues such as
when the Fund may cease to accrue interest, original issue
discount or market discount, when and to what extent deductions
may be taken for bad debts or worthless securities, how payments
received on obligations in default should be allocated between
principal and interest and whether certain exchanges of debt
obligations in a workout context are taxable. These and other
issues will be addressed by the Fund, in the event it invests in
or holds such securities, in order to seek to ensure that it
distributes sufficient income to preserve its status as a
regulated investment company.
Liquidity Risk.
Liquidity relates to the
ability of a fund to sell a security in a timely manner at a
price which reflects the value of that security. The amount of
available information about the financial condition of municipal
securities issuers is generally less extensive than that for
corporate issuers with publicly traded securities, and the
market for municipal securities is generally considered to be
less liquid than the market for corporate debt obligations.
Certain municipal securities in which the Fund may invest, such
as special obligation bonds, lease obligations, participation
certificates and variable rate instruments, may be particularly
less liquid. To the extent the Fund owns or may acquire illiquid
or restricted securities, these securities may involve special
registration requirements, liabilities and costs, and liquidity
and valuation difficulties.
The effects of adverse publicity and investor
perceptions may be more pronounced for securities for which no
established retail market exists as compared with the effects on
securities for which such a market does exist. An economic
downturn or an increase in interest rates could severely disrupt
the market for such securities and adversely affect the value of
outstanding securities or the ability of the issuers to repay
principal and interest. Further, the Fund may have more
difficulty selling such securities in a timely manner and at
their stated value than would be the case for securities for
which an established retail market does exist.
The markets for lower-grade securities may be less
liquid than the markets for higher-grade securities. To the
extent that there is no established retail market for some of
the lower-grade securities in which the Fund may invest, trading
in such securities may be relatively inactive. Prices of
lower-grade securities may decline rapidly in the event a
significant number of holders decide to sell. Changes in
expectations regarding an individual issuer of lower-grade
securities generally could reduce market liquidity for such
securities and make their sale by the Fund at their current
valuation more difficult.
From time to time, the Funds investments may
include securities as to which the Fund, by itself or together
with other funds or accounts managed by the Adviser, holds a
major portion or all of an issue of municipal securities.
Because there may be relatively few potential purchasers for
such investments and, in some cases, there may be contractual
restrictions on resales, the Fund may find it more difficult to
sell such securities at a time when the Adviser believes it is
advisable to do so.
Preferred Shares Risk.
The
Funds use of leverage through Preferred Shares may result
in higher volatility of the net asset value of the Common
Shares, and fluctuations in the dividend rates on the Preferred
Shares (which are expected to reflect yields on short-term
municipal securities) may affect the yield to the
37 Invesco
Van Kampen Select Sector Municipal Trust
Common Shareholders. So long as the Fund is able to realize a
higher net return on its investment portfolio than the then
current dividend rate of the Preferred Shares, the effect of the
leverage provided by the Preferred Shares will be to cause the
Common Shareholders to realize a higher current rate of return
than if the Fund were not so leveraged. On the other hand, to
the extent that the then current dividend rate on the Preferred
Shares approaches the net return on the Funds investment
portfolio, the benefit of leverage to the Common Shareholders
will be reduced, and if the then current dividend rate on the
Preferred Shares were to exceed the net return on the
Funds portfolio, the Funds leveraged capital
structure would result in a lower rate of return to the Common
Shareholders than if the Fund were not so structured.
Similarly, because any decline in the net asset
value of the Funds investments will be borne entirely by
the Common Shareholders, the effect of leverage in a declining
market would result in a greater decrease in net asset value to
the Common Shareholders than if the Fund were not so leveraged.
Any such decrease would likely be reflected in a decline in the
market price for Common Shares. If the Funds current
investment income were not sufficient to meet dividend
requirements on the Preferred Shares, the Fund might have to
liquidate certain of its investments in order to meet required
dividend payments, thereby reducing the net asset value
attributable to the Funds Common Shares.
The amount of Preferred Shares outstanding from time
to time may vary, depending on the Advisers analysis of
conditions in the municipal securities market and interest rate
movements. Management of the amount of outstanding Preferred
Shares places greater reliance on the ability of the Adviser to
predict trends in interest rates than if the Fund did not use
leverage. In the event the Adviser later determines that all or
a portion of such Preferred Shares should be reissued so as to
increase the amount of leverage, no assurance can be given that
the Fund will subsequently be able to reissue Preferred Shares
on terms
and/or
with
dividend rates that are beneficial to the Common Shareholders.
Further, redemption and reissuance of the Preferred Shares, and
any related trading of the Funds portfolio securities,
results in increased transaction costs to the Fund and its
Common Shareholders. Because the Common Shareholders bear these
expenses, changes to the Funds outstanding leverage and
any losses resulting from related portfolio trading will have a
proportionately larger impact on the Common Shares net
asset value and market price.
In addition, the Fund is not permitted to declare
any cash dividend or other distribution on its Common Shares
unless, at the time of such declaration, the Fund has an asset
coverage of at least 200% (determined after deducting the amount
of such dividend or distribution). This prohibition on the
payment of dividends or other distributions might impair the
ability of the Fund to maintain its qualification as a regulated
investment company for federal income tax purposes. The Fund
intends, however, to the extent possible, to purchase or redeem
Preferred Shares from time to time to maintain an asset coverage
of the Preferred Shares of at least 200%.
If a determination were made by the IRS to treat the
Preferred Shares as debt rather than equity for
U.S. federal income tax purposes, the Common Shareholders
might be subject to increased federal income tax liabilities.
Unrated Securities Risk.
Many
lower-grade securities are not listed for trading on any
national securities exchange, and many issuers of lower-grade
securities choose not to have a rating assigned to their
obligations by any NRSRO. As a result, the Funds portfolio
may consist of a higher portion of unlisted or unrated
securities as compared with an investment company that invests
solely in higher-grade, listed securities. Unrated securities
are usually not as attractive to as many buyers as are rated
securities, a factor which may make unrated securities less
marketable. These factors may limit the ability of the Fund to
sell such securities at their fair value. The Fund may be more
reliant on the Advisers judgment and analysis in
evaluating the creditworthiness of an issuer of unrated
securities.
When-Issued and Delayed Delivery
Risks.
When-issued and delayed delivery transactions
are subject to market risk as the value or yield of a security
at delivery may be more or less than the purchase price or the
yield generally available on securities when delivery occurs. In
addition, the Fund is subject to counterparty risk because it
relies on the buyer or seller, as the case may be, to consummate
the transaction, and failure by the other party to complete the
transaction may result in the Fund missing the opportunity of
obtaining a price or yield considered to be advantageous.
Zero Coupon / PIK Bond Risk.
Prices on
non-cash-paying instruments may be more sensitive to changes in
the issuers financial condition, fluctuations in interest
rates and market demand/supply imbalances than cash-paying
securities with similar credit ratings, and thus may be more
speculative than are securities that pay interest periodically
in cash. These securities may subject the Fund to greater market
risk than a fund that does not own these types of securities.
Special tax considerations are associated with investing in
non-cash-paying instruments, such as zero coupon or PIK
securities. The Adviser will weigh these concerns against the
expected total returns from such instruments.
38 Invesco
Van Kampen Select Sector Municipal Trust
Trustees
and Officers
The address of each trustee and
officer is 1555 Peachtree, N.E., Atlanta, Georgia 30309.
Generally, each trustee serves for a three year term or until
his or her successor has been duly elected and qualified, and
each officer serves for a one year term or until his or her
successor has been duly elected and qualified. Column two below
includes length of time served with predecessor entities, if any.
|
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|
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|
|
Number of
|
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|
|
|
|
|
|
|
Funds in
|
|
|
|
|
|
|
|
|
Fund Complex
|
|
|
Name, Year of
Birth and
|
|
Trustee and/
|
|
Principal
Occupation(s)
|
|
Overseen by
|
|
Other
Directorship(s)
|
Position(s) Held
with the Fund
|
|
or Officer
Since
|
|
During Past 5
Years
|
|
Trustee
|
|
Held by
Trustee
|
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|
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Interested
Persons
|
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|
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|
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|
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|
|
Colin Meadows 1971
Trustee, President and Principal Executive Officer
|
|
2010
|
|
Chief Administrative Officer, Invesco Advisers, Inc., since
2006; Prior to 2006, Senior Vice President of business
development and mergers and acquisitions at GE Consumer Finance;
Prior to 2005, Senior Vice President of strategic planning and
technology at Wells Fargo Bank; From 1996 to 2003, associate
principal with McKinsey & Company, focusing on the
financial services and venture capital industries, with emphasis
in banking and asset management sectors.
|
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18
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|
None
|
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Wayne W.
Whalen
1
1939
Trustee and Chair
|
|
1993
|
|
Of Counsel, and prior to 2010, partner in the law firm of
Skadden, Arps, Slate, Meagher & Flom LLP, legal counsel to
funds in the Fund Complex
|
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158
|
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Director of the Abraham Lincoln Presidential Library Foundation
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Independent
Trustees
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David C. Arch 1945
Trustee
|
|
1993
|
|
Chairman and Chief Executive Officer of Blistex Inc., a consumer
health care products manufacturer.
|
|
158
|
|
Member of the Heartland Alliance Advisory Board, a nonprofit
organization serving human needs based in Chicago. Board member
of the Illinois Manufacturers Association. Member of the
Board of Visitors, Institute for the Humanities, University of
Michigan
|
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|
Jerry D. Choate 1938
Trustee
|
|
2003
|
|
From 1995 to 1999, Chairman and Chief Executive Officer of the
Allstate Corporation (Allstate) and Allstate
Insurance Company. From 1994 to 1995, President and Chief
Executive Officer of Allstate. Prior to 1994, various management
positions at Allstate.
|
|
18
|
|
Trustee/Director/Managing General Partner of funds in the Fund
Complex. Director since 1998 and member of the governance and
nominating committee, executive committee, compensation and
management development committee and equity award committee, of
Amgen Inc., a biotechnological company. Director since 1999 and
member of the nominating and governance committee and
compensation and executive committee, of Valero Energy
Corporation, a crude oil refining and marketing company.
Previously, from 2006 to 2007, Director and member of the
compensation committee and audit committee, of H&R Block, a
tax preparation services company.
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|
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|
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|
|
Rodney F. Dammeyer 1940
Trustee
|
|
1993
|
|
Chairman of CAC, LLC, a private company offering capital investment and management advisory services.
Formerly: Prior to January 2004, Director of TeleTech Holdings Inc.; Prior to 2002, Director of Arris Group, Inc.; Prior to 2001, Managing Partner at Equity Group Corporate Investments. Prior to 1995, Vice Chairman of Anixter International. Prior to 1985, experience includes Senior Vice President and Chief Financial Officer of Household International, Inc, Executive Vice President and Chief Financial Officer of Northwest Industries, Inc. and Partner of Arthur Andersen & Co.
|
|
158
|
|
Director of Quidel Corporation and Stericycle, Inc. Prior to May
2008, Trustee of The Scripps Research Institute. Prior to
February 2008, Director of Ventana Medical Systems, Inc. Prior
to April 2007, Director of GATX Corporation. Prior to April
2004, Director of TheraSense, Inc.
|
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Linda Hutton Heagy 1948
Trustee
|
|
2003
|
|
Prior to June 2008, Managing Partner of Heidrick &
Struggles, the second largest global executive search firm, and
from 2001-2004, Regional Managing Director of
U.S. operations at Heidrick & Struggles. Prior to
1997, Managing Partner of Ray & Berndtson, Inc., an
executive recruiting firm. Prior to 1995, Executive Vice
President of ABN AMRO, N.A., a bank holding company, with
oversight for treasury management operations including all
non-credit product pricing. Prior to 1990, experience includes
Executive Vice President of The Exchange National Bank with
oversight of treasury management including capital markets
operations, Vice President of Northern Trust Company and an
Associate at Price Waterhouse.
|
|
18
|
|
Trustee/Director/Managing General Partner of funds in the Fund
Complex. Prior to 2010, Trustee on the University of Chicago
Medical Center Board, Vice Chair of the Board of the YMCA of
Metropolitan Chicago and a member of the Womens Board of
the University of Chicago.
|
|
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|
|
|
|
|
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|
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|
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|
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|
|
R. Craig Kennedy 1952
Trustee
|
|
2003
|
|
Director and President of the German Marshall Fund of the United
States, an independent U.S. foundation created to deepen
understanding, promote collaboration and stimulate exchanges of
practical experience between Americans and Europeans. Formerly,
advisor to the Dennis Trading Group Inc., a managed futures and
option company that invests money for individuals and
institutions. Prior to 1992, President and Chief Executive
Officer, Director and member of the Investment Committee of the
Joyce Foundation, a private foundation.
|
|
18
|
|
Trustee/Director/Managing General Partner of funds in the Fund
Complex. Director of First Solar, Inc.
|
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|
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1
|
Mr. Whalen is considered an interested person
(within the meaning of Section 2(a)(19) of the 1940 Act) of
certain Funds in the Fund Complex by reason of he and his
firm currently providing legal services as legal counsel to such
Funds in the Fund Complex.
|
T-1 Invesco
Van Kampen Select Sector Municipal Trust
Trustees
and
Officers
(continued)
The address of each trustee and
officer is 1555 Peachtree, N.E., Atlanta, Georgia 30309.
Generally, each trustee serves for a three year term or until
his or her successor has been duly elected and qualified, and
each officer serves for a one year term or until his or her
successor has been duly elected and qualified. Column two below
includes length of time served with predecessor entities, if any.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
|
|
|
|
|
|
Funds in
|
|
|
|
|
|
|
|
|
Fund Complex
|
|
|
Name, Year of
Birth and
|
|
Trustee and/
|
|
Principal
Occupation(s)
|
|
Overseen by
|
|
Other
Directorship(s)
|
Position(s) Held
with the Fund
|
|
or Officer
Since
|
|
During Past 5
Years
|
|
Trustee
|
|
Held by
Trustee
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
Independent
Trustees
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
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|
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|
|
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|
|
Howard J Kerr 1935
Trustee
|
|
1993
|
|
Retired. Previous member of the City Council and Mayor of Lake
Forest, Illinois from 1988 through 2002. Previous business
experience from 1981 through 1996 includes President and Chief
Executive Officer of Pocklington Corporation, Inc., an
investment holding company, President and Chief Executive
Officer of Grabill Aerospace, and President of Custom
Technologies Corporation. United States Naval Officer from 1960
through 1981, with responsibilities including Commanding Officer
of United States Navy destroyers and Commander of United States
Navy Destroyer Squadron Thirty-Three, White House experience in
1973 through 1975 as military aide to Vice Presidents Agnew and
Ford and Naval Aid to President Ford, and Military Fellow on the
Council of Foreign Relations in 1978-through 1979.
|
|
18
|
|
Trustee/Director/Managing General Partner of funds in the Fund
Complex. Director of the Lake Forest Bank & Trust. Director
of the Marrow Foundation.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jack E. Nelson 1936
Trustee
|
|
2003
|
|
President of Nelson Investment Planning Services, Inc., a
financial planning company and registered investment adviser in
the State of Florida. President of Nelson Ivest Brokerage
Services Inc., a member of the Financial Industry Regulatory
Authority (FINRA), Securities Investors Protection
Corp. and the Municipal Securities Rulemaking Board. President
of Nelson Sales and Services Corporation, a marketing and
services company to support affiliated companies.
|
|
18
|
|
Trustee/Director/Managing General Partner of funds in the Fund
Complex.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hugo F. Sonnenschein 1940
Trustee
|
|
1994
|
|
Distinguished Service Professor and President Emeritus of the
University of Chicago and the Adam Smith Distinguished Service
Professor in the Department of Economics at the University of
Chicago. Prior to July 2000, President of the University of
Chicago.
|
|
158
|
|
Trustee of the University of Rochester and a member of its
investment committee. Member of the National Academy of
Sciences, the American Philosophical Society and a fellow of the
American Academy of Arts and Sciences
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
|
|
|
|
Suzanne H. Woolsey, Ph.D. 1941 Trustee
|
|
2003
|
|
Chief Communications Officer of the National Academy of Sciences
and Engineering and Institute of Medicine/National Research
Council, an independent, federally chartered policy institution,
from 2001 to November 2003 and Chief Operating Officer from 1993
to 2001. Executive Director of the Commission on Behavioral and
Social Sciences and Education at the National Academy of
Sciences/National Research Council from 1989 to 1993. Prior to
1980, experience includes Partner of Coopers & Lybrand
(from 1980 to 1989), Associate Director of the US Office of
Management and Budget (from 1977 to 1980) and Program Director
of the Urban Institute (from 1975 to 1977).
|
|
18
|
|
Trustee/Director/Managing General Partner of funds in the Fund
Complex. Independent Director and audit committee chairperson of
Changing World Technologies, Inc., an energy manufacturing
company, since July 2008. Independent Director and member of
audit and governance committees of Fluor Corp., a global
engineering, construction and management company, since January
2004. Director of Intelligent Medical Devices, Inc., a private
company which develops symptom-based diagnostic tools for viral
respiratory infections. Advisory Board member of ExactCost LLC,
a private company providing activity-based costing for
hospitals, laboratories, clinics, and physicians, since 2008.
Chairperson of the Board of Trustees of the Institute for
Defense Analyses, a federally funded research and development
center, since 2000. Trustee from 1992 to 2000 and 2002 to
present, current chairperson of the finance committee, current
member of the audit committee, strategic growth committee and
executive committee, and former Chairperson of the Board of
Trustees (from 1997 to 1999), of the German Marshall Fund of the
United States, a public foundation. Lead Independent Trustee of
the Rocky Mountain Institute, a non-profit energy and
environmental institute; Trustee since 2004. Chairperson of the
Board of Trustees of the Colorado College; Trustee since 1995.
Trustee of California Institute of Technology. Previously,
Independent Director and member of audit committee and
governance committee of Neutrogena Corporation from 1998 to
2006; and Independent Director of Arbros Communications from
2000 to 2002
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T-2 Invesco
Van Kampen Select Sector Municipal Trust
Trustees
and
Officers
(continued)
The address of each trustee and
officer is 1555 Peachtree, N.E., Atlanta, Georgia 30309.
Generally, each trustee serves for a three year term or until
his or her successor has been duly elected and qualified, and
each officer serves for a one year term or until his or her
successor has been duly elected and qualified. Column two below
includes length of time served with predecessor entities, if any.
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|
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|
|
|
|
|
|
|
|
Number of
|
|
|
|
|
|
|
|
|
Funds in
|
|
|
|
|
|
|
|
|
Fund Complex
|
|
|
Name, Year of
Birth and
|
|
Trustee and/
|
|
Principal
Occupation(s)
|
|
Overseen by
|
|
Other
Directorship(s)
|
Position(s) Held
with the Fund
|
|
or Officer
Since
|
|
During Past 5
Years
|
|
Trustee
|
|
Held by
Trustee
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
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|
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|
|
|
|
|
|
Other
Officers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
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|
|
|
|
|
John M. Zerr 1962
Senior Vice President, Chief Legal
Officer and Secretary
|
|
2010
|
|
Director, Senior Vice President, Secretary and General Counsel,
Invesco Management Group, Inc. (formerly known as Invesco Aim
Management Group, Inc.) and Van Kampen Exchange Corp.; Senior
Vice President, Invesco Advisers, Inc. (formerly known as
Invesco Institutional (N.A.), Inc.) (registered investment
adviser); Senior Vice President and Secretary, Invesco
Distributors, Inc. (formerly known as Invesco Aim Distributors,
Inc.); Director, Vice President and Secretary, Invesco
Investment Services, Inc. (formerly known as Invesco Aim
Investment Services, Inc.) and IVZ Distributors, Inc. (formerly
known as INVESCO Distributors, Inc.); Director and Vice
President, INVESCO Funds Group, Inc.; Senior Vice President,
Chief Legal Officer and Secretary, The Invesco Funds; Manager,
Invesco PowerShares Capital Management LLC; Director, Secretary
and General Counsel, Invesco Investment Advisers LLC (formerly
known as Van Kampen Asset Management); Secretary and General
Counsel, Van Kampen Funds Inc. and Chief Legal Officer,
PowerShares Exchange-Traded Fund Trust, PowerShares
Exchange-Traded Fund Trust II, PowerShares India Exchange-Traded
Fund Trust and PowerShares Actively Managed Exchange-Traded Fund
Trust
|
|
N/A
|
|
N/A
|
|
|
|
|
Formerly: Director and Secretary, Van Kampen Advisors Inc.;
Director Vice President, Secretary and General Counsel Van
Kampen Investor Services Inc.; Director, Invesco Distributors,
Inc. (formerly known as Invesco Aim Distributors, Inc.);
Director, Senior Vice President, General Counsel and Secretary,
Invesco Advisers, Inc.; and Van Kampen Investments Inc.;
Director, Vice President and Secretary, Fund Management Company;
Director, Senior Vice President, Secretary, General Counsel and
Vice President, Invesco Aim Capital Management, Inc.; Chief
Operating Officer and General Counsel, Liberty Ridge Capital,
Inc. (an investment adviser); Vice President and Secretary, PBHG
Funds (an investment company) and PBHG Insurance Series Fund (an
investment company); Chief Operating Officer, General Counsel
and Secretary, Old Mutual Investment Partners (a broker-dealer);
General Counsel and Secretary, Old Mutual Fund Services (an
administrator) and Old Mutual Shareholder Services (a
shareholder servicing center); Executive Vice President, General
Counsel and Secretary, Old Mutual Capital, Inc. (an investment
adviser); and Vice President and Secretary, Old Mutual Advisors
Funds (an investment company)
|
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|
|
|
|
|
|
Karen Dunn Kelley 1960
Vice President
|
|
2010
|
|
Head of Invescos World Wide Fixed Income and Cash
Management Group; Senior Vice President, Invesco Management
Group, Inc. (formerly known as Invesco Aim Management Group,
Inc.) and Invesco Advisers, Inc. (formerly known as Invesco
Institutional (N.A.), Inc.) (registered investment adviser);
Executive Vice President, Invesco Distributors, Inc. (formerly
known as Invesco Aim Distributors, Inc.); Director, Invesco
Mortgage Capital Inc.; Vice President, The Invesco Funds (other
than AIM Treasurers Series Trust (Invesco Treasurers
Series Trust) and Short-Term Investments Trust); and President
and Principal Executive Officer, The Invesco Funds (AIM
Treasurers Series Trust (Invesco Treasurers Series
Trust) and Short-Term Investments Trust only).
|
|
N/A
|
|
N/A
|
|
|
|
|
Formerly: Senior Vice President, Van Kampen Investments Inc.;
Vice President, Invesco Advisers, Inc. (formerly known as
Invesco Institutional (N.A.), Inc.); Director of Cash Management
and Senior Vice President, Invesco Advisers, Inc. and Invesco
Aim Capital Management, Inc.; President and Principal Executive
Officer, Tax-Free Investments Trust; Director and President,
Fund Management Company; Chief Cash Management Officer, Director
of Cash Management, Senior Vice President, and Managing
Director, Invesco Aim Capital Management, Inc.; Director of Cash
Management, Senior Vice President, and Vice President, Invesco
Advisers, Inc. and The Invesco Funds (AIM Treasurers
Series Trust (Invesco Treasurers Series Trust), Short-Term
Investments Trust and Tax-Free Investments Trust only)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sheri Morris 1964
Vice President, Principal Financial Officer and Treasurer
|
|
2010
|
|
Vice President, Treasurer and Principal Financial Officer, The
Invesco Funds; Vice President, Invesco Advisers, Inc. (formerly
known as Invesco Institutional (N.A.), Inc.) (registered
investment adviser).
|
|
N/A
|
|
N/A
|
|
|
|
|
Formerly: Treasurer, PowerShares Exchange-Traded Fund Trust,
PowerShares Exchange-Traded Fund Trust II, PowerShares India
Exchange-Traded Fund Trust and PowerShares Actively Managed
Exchange-Traded Fund Trust, Vice President, Invesco Advisers,
Inc., Invesco Aim Capital Management, Inc. and Invesco Aim
Private Asset Management, Inc.; Assistant Vice President and
Assistant Treasurer, The Invesco Funds and Assistant Vice
President, Invesco Advisers, Inc., Invesco Aim Capital
Management, Inc. and Invesco Aim Private Asset Management, Inc.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
T-3 Invesco
Van Kampen Select Sector Municipal Trust
Trustees
and
Officers
(continued)
The address of each trustee and
officer is 1555 Peachtree, N.E., Atlanta, Georgia 30309.
Generally, each trustee serves for a three year term or until
his or her successor has been duly elected and qualified, and
each officer serves for a one year term or until his or her
successor has been duly elected and qualified. Column two below
includes length of time served with predecessor entities, if any.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of
|
|
|
|
|
|
|
|
|
Funds in
|
|
|
|
|
|
|
|
|
Fund Complex
|
|
|
Name, Year of
Birth and
|
|
Trustee and/
|
|
Principal
Occupation(s)
|
|
Overseen by
|
|
Other
Directorship(s)
|
Position(s) Held
with the Fund
|
|
or Officer
Since
|
|
During Past 5
Years
|
|
Trustee
|
|
Held by
Trustee
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
Officers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Yinka Akinsola 1977
Anti-Money Laundering Compliance Officer
|
|
2012
|
|
Anti-Money Laundering Compliance Officer, Invesco Advisers, Inc.
(formerly known as Invesco Institutional (N.A.), Inc.)
(registered investment adviser); Invesco Distributors, Inc.
(formerly known as Invesco Aim Distributors, Inc.), Invesco
Investment Services, Inc. (formerly known as Invesco Aim
Investment Services, Inc.), The Invesco Funds, Invesco Van
Kampen Closed-End Funds, Van Kampen Funds Inc., PowerShares
Exchange-Traded Fund Trust, PowerShares Exchange-Traded Fund
Trust II, PowerShares India Exchange-Traded Fund Trust, and
PowerShares Actively Managed Exchange-Traded Fund Trust
|
|
N/A
|
|
N/A
|
|
|
|
|
Formerly: Regulatory Analyst III, Financial Industry Regulatory
Authority (FINRA).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Valinda Arnett-Patton 1959
Chief Compliance Officer
|
|
2011
|
|
Chief Compliance Officer, Invesco Van Kampen Closed-End Funds.
|
|
N/A
|
|
N/A
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Office of the Fund
1555
Peachtree Street, N.E.
Atlanta, GA 30309
|
|
Investment Adviser
Invesco
Advisers, Inc.
1555 Peachtree Street, N.E.
Atlanta, GA 30309
|
|
Auditors
PricewaterhouseCoopers
LLP
1201 Louisiana Street, Suite 2900
Houston, TX 77002-5678
|
|
Custodian
State
Street Bank and Trust Company
225 Franklin
Boston, MA 02110-2801
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Counsel to the Fund
Skadden,
Arps, Slate, Meagher & Flom LLP
155 North Wacker Drive
Chicago, IL 60606
|
|
Transfer Agent
Computershare
Trust Company, N.A.
P.O. Box 43078
Providence, RI 02940-3078
|
|
|
|
|
T-4 Invesco
Van Kampen Select Sector Municipal Trust
Correspondence information
Send general correspondence to Computershare, P.O. Box 43078, Providence, RI 02940-3078.
Invesco privacy policy
You share personal and financial information with us that is necessary for your transactions and your account records. We take
very seriously the obligation to keep that information confidential and private.
Invesco collects nonpublic personal information about you from account applications or other
forms you complete and from your transactions with us or our affiliates. We do not disclose
information about you or our former customers to service providers or other third parties except to
the extent necessary to service your account and in other limited circumstances as permitted by
law. For example, we use this information to facilitate the delivery of transaction confirmations,
financial reports, prospectuses and tax forms.
Even within Invesco, only people involved in the servicing of your accounts and compliance
monitoring have access to your information. To ensure the highest level of confidentiality and
security, Invesco maintains physical, electronic and procedural safeguards that meet or exceed
federal standards. Special measures, such as data encryption and authentication, apply to your
communications with us on our website. More detail is available to you at invesco.com/privacy.
Trust holdings and proxy voting information
The Trust provides a complete list of its holdings four times in each fiscal year, at the quarter-ends. For the second and fourth
quarters, the lists appear in the Trusts semiannual and annual reports to shareholders. For the first and third quarters, the
Trust files the lists with the Securities and Exchange Commission (SEC) on Form N-Q. Shareholders can also look up the Trusts
Forms N-Q on the SEC website at sec.gov. Copies of the Trusts Forms N-Q may be reviewed and copied at the SEC Public
Reference Room in Washington, D.C. You can obtain information on the operation of the Public Reference Room, including
information about duplicating fee charges, by calling 202 551 8090 or 800 732 0330, or by electronic request at the following
email address: publicinfo@sec.gov. The SEC file number for the Trust is 811-08000.
A description of the policies and procedures that the Trust uses to determine how to vote proxies relating to portfolio securities is
available without charge, upon request, from our Client Services department at 800 341 2929 or at invesco.com/proxyguidelines.
The information is also available on the SEC website, sec.gov.
Information regarding how the Trust voted proxies related to its portfolio securities during the 12
months ended June 30, 2011, is available at invesco.com/proxysearch. In addition, this information
is available on the SEC website at sec.gov.
Invesco Advisers, Inc. is an investment adviser; it provides investment
advisory services to individual and institutional clients and does not sell
securities. Invesco Distributors, Inc. is the U.S. distributor for Invesco Ltd.s
retail mutual funds, exchange-traded funds and institutional money market funds.
Both are wholly owned, indirect subsidiaries of Invesco Ltd.
|
|
|
|
|
|
|
VK-CE-SSMUNI-AR-1
|
|
Invesco Distributors, Inc.
|
ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the Registrant had adopted a code
of ethics (the Code) that applies to the Registrants principal executive officer
(PEO) and principal financial officer (PFO). There were no amendments to the Code
during the period covered by the report. The Registrant did not grant any waivers,
including implicit waivers, from any provisions of the Code to the PEO or PFO during
the period covered by this report.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The Board of Trustees has determined that the Registrant has at least one audit committee
financial expert serving on its Audit Committee. The Audit Committee financial experts are
Jerry D. Choate, Linda Hutton Heagy and R. Craig Kennedy. Jerry D. Choate, Linda Hutton
Heagy and R. Craig Kennedy are independent within the meaning of that term as used in
Form N-CSR.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Fees Billed by PWC Related to the Registrant
PWC billed the Registrant aggregate fees for services rendered to the Registrant for the last
two fiscal years as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percentage of Fees
|
|
|
|
|
|
|
Percentage of Fees
|
|
|
|
|
|
|
|
Billed Applicable to
|
|
|
|
|
|
|
Billed Applicable to
|
|
|
|
|
|
|
|
Non-Audit Services
|
|
|
|
|
|
|
Non-Audit Services
|
|
|
|
Fees Billed for
|
|
|
Provided for fiscal
|
|
|
Fees Billed for
|
|
|
Provided for fiscal
|
|
|
|
Services Rendered to
|
|
|
year end 2/29/2012
|
|
|
Services Rendered to
|
|
|
year end 2/28/2011
|
|
|
|
the Registrant for
|
|
|
Pursuant to Waiver of
|
|
|
the Registrant for
|
|
|
Pursuant to Waiver of
|
|
|
|
fiscal year end
|
|
|
Pre-Approval
|
|
|
fiscal year end
|
|
|
Pre-Approval
|
|
|
|
2/29/2012
|
|
|
Requirement
(1)
|
|
|
2/28/2011
|
|
|
Requirement
(1)
|
|
Audit Fees
|
|
$
|
36,300
|
|
|
|
N/A
|
|
|
$
|
19,250
|
|
|
|
N/A
|
|
Audit-Related
Fees
(2)
|
|
$
|
5,000
|
|
|
|
0%
|
|
|
$
|
4,000
|
|
|
|
0%
|
|
Tax Fees
(3)
|
|
$
|
5,500
|
|
|
|
0%
|
|
|
$
|
2,300
|
|
|
|
0%
|
|
All Other Fees
(4)
|
|
$
|
0
|
|
|
|
0%
|
|
|
$
|
1,667
|
|
|
|
0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fees
|
|
$
|
46,800
|
|
|
|
0%
|
|
|
$
|
27,217
|
|
|
|
0%
|
|
PWC billed the Registrant aggregate non-audit fees of $10,500 for the fiscal year ended February 29, 2012, and $7,967 for the fiscal year
ended February 28, 2011, for non-audit services rendered to the Registrant.
|
|
|
(1)
|
|
With respect to the provision of non-audit services, the pre-approval requirement is waived
pursuant to a de minimis exception if (i) such services were not recognized as non-audit
services by the Registrant at the time of engagement, (ii) the aggregate amount of all such
services provided is no more than 5% of the aggregate audit and non-audit fees paid by the
Registrant to PWC during a fiscal year; and (iii) such services are promptly brought to the
attention of the Registrants Audit Committee and approved by the Registrants Audit Committee
prior to the completion of the audit.
|
|
(2)
|
|
Audit-Related fees for the fiscal year end February 29, 2012 includes fees billed for agreed
upon procedures related to auction rate preferred securities. Audit-Related fees for the
fiscal year end February 28, 2011 includes fees billed for agreed upon procedures related to
auction rate preferred securities.
|
|
(3)
|
|
Tax fees for the fiscal year end February 29, 2012 includes fees billed for reviewing tax
returns. Tax fees for the fiscal year end February 28, 2011 includes fees billed for
reviewing tax returns.
|
|
(4)
|
|
All Other fees for the fiscal year end February 28, 2011 includes fees billed for completing
professional services related to benchmark analysis.
|
Fees Billed by PWC Related to Invesco and Invesco Affiliates
PWC billed Invesco Advisers, Inc. (Invesco), the Registrants adviser, and any entity
controlling, controlled by or under common control with Invesco that provides ongoing services to
the Registrant (Invesco Affiliates) aggregate fees for pre-approved non-audit services rendered
to Invesco and Invesco Affiliates for the last two fiscal years as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fees Billed for Non-
|
|
|
|
|
|
|
Fees Billed for Non-
|
|
|
|
|
|
|
Audit Services
|
|
|
|
|
|
|
Audit Services
|
|
|
|
|
|
|
Rendered to Invesco
|
|
|
Percentage of Fees
|
|
|
Rendered to Invesco
|
|
|
Percentage of Fees
|
|
|
|
and Invesco Affiliates
|
|
|
Billed Applicable to
|
|
|
and Invesco Affiliates
|
|
|
Billed Applicable to
|
|
|
|
for fiscal year end
|
|
|
Non-Audit Services
|
|
|
for fiscal year end
|
|
|
Non-Audit Services
|
|
|
|
2/29/2012 That Were
|
|
|
Provided for fiscal year
|
|
|
2/28/2011 That Were
|
|
|
Provided for fiscal year
|
|
|
|
Required
|
|
|
end 2/29/2012
|
|
|
Required
|
|
|
end 2/28/2011
|
|
|
|
to be Pre-Approved
|
|
|
Pursuant to Waiver of
|
|
|
to be Pre-Approved
|
|
|
Pursuant to Waiver of
|
|
|
|
by the Registrants
|
|
|
Pre-Approval
|
|
|
by the Registrants
|
|
|
Pre-Approval
|
|
|
|
Audit Committee
|
|
|
Requirement
(1)
|
|
|
Audit Committee
|
|
|
Requirement
(1)
|
|
Audit-Related Fees
|
|
$
|
0
|
|
|
|
0%
|
|
|
$
|
0
|
|
|
|
0%
|
|
Tax Fees
|
|
$
|
0
|
|
|
|
0%
|
|
|
$
|
0
|
|
|
|
0%
|
|
All Other Fees
|
|
$
|
0
|
|
|
|
0%
|
|
|
$
|
0
|
|
|
|
0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Fees
(2)
|
|
$
|
0
|
|
|
|
0%
|
|
|
$
|
0
|
|
|
|
0%
|
|
|
|
|
(1)
|
|
With respect to the provision of non-audit services, the pre-approval requirement is waived
pursuant to a de minimis exception if (i) such services were not recognized as non-audit
services by the Registrant at the time of engagement, (ii) the aggregate amount of all such
services provided is no more than 5% of the aggregate audit and non-audit fees paid by the
Registrant, Invesco and Invesco Affiliates to PWC during a fiscal year; and (iii) such
services are promptly brought to the attention of the Registrants Audit Committee and
approved by the Registrants Audit Committee prior to the completion of the audit.
|
|
(2)
|
|
Including the fees for services not required to be pre-approved by the registrants audit
committee, PWC billed Invesco and Invesco Affiliates aggregate non-audit fees of $0 for the
fiscal year ended February 29, 2012, and $0 for the fiscal year ended February 28, 2011, for
non-audit services rendered to Invesco and Invesco Affiliates.
|
|
|
|
The Audit Committee also has considered whether the provision of non-audit services that
were rendered to Invesco and Invesco Affiliates that were not required to be pre-approved
pursuant to SEC regulations, if any, is compatible with maintaining PWCs independence.
To the extent that such services were provided, the Audit Committee determined that the
provision of such services is compatible with PWC maintaining independence with respect to
the Registrant.
|
PRE-APPROVAL OF AUDIT AND NON-AUDIT SERVICES
POLICIES AND PROCEDURES
As adopted by the Audit Committees of
the Invesco Funds (the Funds)
Statement of Principles
Under the Sarbanes-Oxley Act of 2002 and rules adopted by the Securities and Exchange
Commission (SEC) (Rules), the Audit Committees of the Funds (the Audit Committees) Board of
Trustees (the Board) are responsible for the appointment, compensation and oversight of the work
of independent accountants (an Auditor). As part of this responsibility and to assure that the
Auditors independence is not impaired, the Audit Committees pre-approve the audit and non-audit
services provided to the Funds by each Auditor, as well as all non-audit services provided by the
Auditor to the Funds investment adviser and to affiliates of the adviser that provide ongoing
services to the Funds (Service Affiliates) if the services directly impact the Funds operations
or financial reporting. The SEC Rules also specify the types of services that an Auditor may not
provide to its audit client. The following policies and procedures comply with the requirements
for pre-approval and provide a mechanism by which management of the Funds may request and secure
pre-approval of audit and non-audit services in an orderly manner with minimal disruption to normal
business operations.
Proposed services either may be pre-approved without consideration of specific case-by-case
services by the Audit Committees (general pre-approval) or require the specific pre-approval of
the Audit Committees (specific pre-approval). As set forth in these policies and procedures,
unless a type of service has received general pre-approval, it will require specific pre-approval
by the Audit Committees. Additionally, any fees exceeding 110% of estimated pre-approved fee
levels provided at the time the service was pre-approved will also require specific approval by the
Audit Committees before payment is made. The Audit Committees will also consider the impact of
additional fees on the Auditors independence when determining whether to approve any additional
fees for previously pre-approved services.
The Audit Committees will annually review and generally pre-approve the services that may be
provided by each Auditor without obtaining specific pre-approval from the Audit Committee generally
on an annual basis. The term of any general pre-approval runs from the date of such pre-approval
through September 30
th
of the following year, unless the Audit Committees consider a
different period and state otherwise. The Audit Committees will add to or subtract from the list
of general pre-approved services from time to time, based on subsequent determinations.
The purpose of these policies and procedures is to set forth the guidelines to assist the Audit
Committees in fulfilling their responsibilities.
Delegation
The Audit Committees may from time to time delegate pre-approval authority to one or more of
its members who are Independent Trustees. All decisions to pre-approve a service by a delegated
member shall be reported to the Audit Committees at the next quarterly meeting.
Audit Services
The annual audit services engagement terms will be subject to specific pre-approval of the
Audit Committees. Audit services include the annual financial statement audit and other procedures
such as tax provision work that is required to be performed by the independent auditor to be able
to form an opinion on the Funds financial statements. The Audit Committees will obtain, review
and consider sufficient information concerning the proposed Auditor to make a reasonable evaluation
of the Auditors qualifications and independence.
In addition to the annual Audit services engagement, the Audit Committees may grant either general
or specific pre-approval of other audit services, which are those services that only the
independent auditor reasonably can provide. Other Audit services may include services such as
issuing consents for the
inclusion of audited financial statements with SEC registration
statements, periodic reports and other documents filed with the SEC or other documents issued in
connection with securities offerings.
Non-Audit Services
The Audit Committees may provide either general or specific pre-approval of any non-audit
services to the Funds and its Service Affiliates if the Audit Committees believe that the provision
of the service will not impair the independence of the Auditor, is consistent with the SECs Rules
on auditor independence, and otherwise conforms to the Audit Committees general principles and
policies as set forth herein.
Audit-Related Services
Audit-related services are assurance and related services that are reasonably related to the
performance of the audit or review of the Funds financial statements or that are traditionally
performed by the independent auditor. Audit-related services include, among others, accounting
consultations related to accounting, financial reporting or disclosure matters not classified as
Audit services; assistance with understanding and implementing new accounting and financial
reporting guidance from rulemaking authorities; and agreed-upon procedures related to mergers,
compliance with ratings agency requirements and interfund lending activities.
Tax Services
Tax services include, but are not limited to, the review and signing of the Funds federal tax
returns, the review of required distributions by the Funds and consultations regarding tax matters
such as the tax treatment of new investments or the impact of new regulations. The Audit
Committees will scrutinize carefully the retention of the Auditor in connection with a transaction
initially recommended by the Auditor, the major business purpose of which may be tax avoidance or
the tax treatment of which may not be supported in the Internal Revenue Code and related
regulations. The Audit Committees will consult with the Funds Treasurer (or his or her designee)
and may consult with outside counsel or advisors as necessary to ensure the consistency of Tax
services rendered by the Auditor with the foregoing policy.
No Auditor shall represent any Fund or any Service Affiliate before a tax court, district court or
federal court of claims.
Under rules adopted by the Public Company Accounting Oversight Board and approved by the SEC, in
connection with seeking Audit Committees pre-approval of permissible Tax services, the Auditor
shall:
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1.
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Describe in writing to the Audit Committees, which writing may be in the form of the
proposed engagement letter:
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a.
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The scope of the service, the fee structure for the engagement, and
any side letter or amendment to the engagement letter, or any other agreement
between the Auditor and the Fund, relating to the service; and
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b.
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Any compensation arrangement or other agreement, such as a referral
agreement, a referral fee or fee-sharing arrangement, between the Auditor and any
person (other than the Fund) with respect to the promoting, marketing, or
recommending of a transaction covered by the service;
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2.
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Discuss with the Audit Committees the potential effects of the services on the
independence of the Auditor; and
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3.
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Document the substance of its discussion with the Audit Committees.
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All Other Auditor Services
The Audit Committees may pre-approve non-audit services classified as All other services that are
not categorically prohibited by the SEC, as listed in Exhibit 1 to this policy.
Pre-Approval Fee Levels or Established Amounts
Pre-approval of estimated fees or established amounts for services to be provided by the
Auditor under general or specific pre-approval policies will be set periodically by the Audit
Committees. Any proposed fees exceeding 110% of the maximum estimated pre-approved fees or
established amounts for pre-approved audit and non-audit services will be reported to the Audit
Committees at the quarterly Audit Committees meeting and will require specific approval by the
Audit Committees before payment is made. The Audit Committees will always factor in the overall
relationship of fees for audit and non-audit services in determining whether to pre-approve any
such services and in determining whether to approve any additional fees exceeding 110% of the
maximum pre-approved fees or established amounts for previously pre-approved services.
Procedures
Generally on an annual basis, Invesco Advisers, Inc. (Invesco) will submit to the Audit
Committees for general pre-approval, a list of non-audit services that the Funds or Service
Affiliates of the Funds may request from the Auditor. The list will describe the non-audit
services in reasonable detail and will include an estimated range of fees and such other
information as the Audit Committee may request.
Each request for services to be provided by the Auditor under the general pre-approval of the Audit
Committees will be submitted to the Funds Treasurer (or his or her designee) and must include a
detailed description of the services to be rendered. The Treasurer or his or her designee will
ensure that such services are included within the list of services that have received the general
pre-approval of the Audit Committees. The Audit Committees will be informed at the next quarterly
scheduled Audit Committees meeting of any such services for which the Auditor rendered an invoice
and whether such services and fees had been pre-approved and if so, by what means.
Each request to provide services that require specific approval by the Audit Committees shall be
submitted to the Audit Committees jointly by the Funds Treasurer or his or her designee and the
Auditor, and must include a joint statement that, in their view, such request is consistent with
the policies and procedures and the SEC Rules.
Each request to provide tax services under either the general or specific pre-approval of the Audit
Committees will describe in writing: (i) the scope of the service, the fee structure for the
engagement, and any side letter or amendment to the engagement letter, or any other agreement
between the Auditor and the audit client, relating to the service; and (ii) any compensation
arrangement or other agreement between the Auditor and any person (other than the audit client)
with respect to the promoting, marketing, or recommending of a transaction covered by the service.
The Auditor will discuss with the Audit Committees the potential effects of the services on the
Auditors independence and will document the substance of the discussion.
Non-audit services pursuant to the
de minimis
exception provided by the SEC Rules will be promptly
brought to the attention of the Audit Committees for approval, including documentation that each of
the conditions for this exception, as set forth in the SEC Rules, has been satisfied.
On at least an annual basis, the Auditor will prepare a summary of all the services provided to any
entity in the investment company complex as defined in section 2-01(f)(14) of Regulation S-X in
sufficient detail as to the nature of the engagement and the fees associated with those services.
The Audit Committees have designated the Funds Treasurer to monitor the performance of all
services provided by the Auditor and to ensure such services are in compliance with these policies
and procedures. The Funds Treasurer will report to the Audit Committees on a periodic basis as to
the results of such monitoring. Both the Funds Treasurer and management of Invesco will
immediately report to the chairman of the Audit Committees any breach of these policies and
procedures that comes to the attention of the Funds Treasurer or senior management of Invesco.
Exhibit 1 to Pre-Approval of Audit and Non-Audit Services Policies and Procedures
Conditionally Prohibited Non-Audit Services (not prohibited if the Fund can reasonably conclude
that the results of the service would not be subject to audit procedures in connection with the
audit of the Funds financial statements)
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Bookkeeping or other services related to the accounting records or financial
statements of the audit client
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Financial information systems design and implementation
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Appraisal or valuation services, fairness opinions, or contribution-in-kind reports
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Actuarial services
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Internal audit outsourcing services
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Categorically Prohibited Non-Audit Services
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Management functions
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Human resources
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Broker-dealer, investment adviser, or investment banking services
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Legal services
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Expert services unrelated to the audit
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Any service or product provided for a contingent fee or a commission
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Services related to marketing, planning, or opining in favor of the tax treatment
of confidential transactions or aggressive tax position transactions, a significant
purpose of which is tax avoidance
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Tax services for persons in financial reporting oversight roles at the Fund
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Any other service that the Public Company Oversight Board determines by regulation
is impermissible.
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ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
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(a)
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The registrant has a separately-designed standing audit
committee established in accordance with Section 3(a)(58)(A) of the Securities
Exchange Act of 1934, as amended. Members of the audit committee are: Jerry
D. Choate, Linda Hutton Heagy and R. Craig Kennedy.
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(a)
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Not applicable.
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ITEM 6. SCHEDULE OF INVESTMENTS.
Investments in securities of unaffiliated issuers is included as part of the
reports to stockholders filed under Item 1 of this Form.
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ITEM 7.
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DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT
INVESTMENT COMPANIES.
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I.2. PROXY POLICIES AND PROCEDURES RETAIL
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Applicable to
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Retail Accounts
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Risk Addressed by Policy
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breach of fiduciary duty to client under
Investment Advisers Act of 1940 by placing
Invesco personal interests ahead of client
best economic interests in voting proxies
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Relevant Law and Other Sources
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Investment Advisers Act of 1940
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Last Tested Date
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Policy/Procedure Owner
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Advisory Compliance
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Policy Approver
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Fund Board
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Approved/Adopted Date
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January 1, 2010
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The following policies and procedures apply to certain funds and other accounts managed by
Invesco Advisers, Inc. (Invesco).
A. POLICY STATEMENT
Introduction
Our Belief
The Invesco Funds Boards of Trustees and Invescos investment professionals expect a high standard
of corporate governance from the companies in our portfolios so that Invesco may fulfill its
fiduciary obligation to our fund shareholders and other account holders. Well governed companies
are characterized by a primary focus on the interests of shareholders, accountable boards of
directors, ample transparency in financial disclosure, performance-driven cultures and appropriate
consideration of all stakeholders. Invesco believes well governed companies create greater
shareholder wealth over the long term than poorly governed companies, so we endeavor to vote in a
manner that increases the value of our investments and fosters good governance within our portfolio
companies.
In determining how to vote proxy issues, Invesco considers the probable business consequences of
each issue and votes in a manner designed to protect and enhance fund shareholders and other
account holders interests. Our voting decisions are intended to enhance each companys total
shareholder value over Invescos typical investment horizon.
Proxy voting is an integral part of Invescos investment process. We believe that the right to vote
proxies should be managed with the same care as all other elements of the investment process. The
objective of Invescos proxy-voting activity is to promote good governance and advance the economic
interests of our clients. At no time will Invesco exercise its voting power to advance its own
commercial interests, to pursue a social or political cause that is unrelated to our clients
economic interests, or to favor a particular client or business relationship to the detriment of
others.
B. OPERATING PROCEDURES AND RESPONSIBLE PARTIES
Proxy administration
The Invesco Retail Proxy Committee (the Proxy Committee) consists of members representing
Invescos Investments, Legal and Compliance departments. Invescos Proxy Voting Guidelines (the
Guidelines) are revised annually by the Proxy Committee, and are approved by the Invesco Funds
Boards of Trustees. The Proxy Committee implements the Guidelines and oversees proxy voting.
The Proxy Committee has retained outside experts to assist with the analysis and voting of proxy
issues. In addition to the advice offered by these experts, Invesco uses information gathered from
our own research, company managements, Invescos portfolio managers and outside shareholder groups
to reach our voting decisions.
Generally speaking, Invescos investment-research process leads us to invest in companies led by
management teams we believe have the ability to conceive and execute strategies to outperform their
competitors. We select companies for investment based in large part on our assessment of their
management teams ability to create shareholder wealth. Therefore, in formulating our proxy-voting
decisions, Invesco gives proper consideration to the recommendations of a companys Board of
Directors.
Important principles underlying the Invesco Proxy Voting Guidelines
I. Accountability
Management teams of companies are accountable to their boards of directors, and directors of
publicly held companies are accountable to their shareholders. Invesco endeavors to vote the
proxies of its portfolio companies in a manner that will reinforce the notion of a boards
accountability to its shareholders. Consequently, Invesco votes against any actions that would
impair the rights of shareholders or would reduce shareholders influence over the board or over
management.
The following are specific voting issues that illustrate how Invesco applies this principle of
accountability.
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Elections of directors.
In uncontested director elections for companies that do not have
a controlling shareholder, Invesco votes in favor of slates if they are comprised of at
least a majority of independent directors and if the boards key committees are fully
independent. Key committees include the Audit, Compensation and Governance or Nominating
Committees. Invescos standard of independence excludes directors who, in addition to the
directorship, have any material business or family relationships with the companies they
serve.
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Contested director elections are evaluated on a case-by-case basis and are decided within
the context of Invescos investment thesis on a company.
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Director performance.
Invesco withholds votes from directors who exhibit a lack of
accountability to shareholders, either through their level of attendance at meetings or by
enacting egregious corporate-governance or other policies. In cases of material financial
restatements, accounting fraud, habitually late filings, adopting shareholder rights plan
(poison pills) without shareholder approval, or other areas of poor performance, Invesco
may withhold votes from some or all of a companys directors. In situations where
directors performance is a concern, Invesco may also support shareholder proposals to take
corrective actions such as so-called clawback provisions.
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Auditors and Audit Committee members.
Invesco believes a companys Audit Committee has a
high degree of responsibility to shareholders in matters of financial disclosure, integrity
of the financial statements and effectiveness of a companys internal controls.
Independence, experience and financial expertise are critical elements of a
well-functioning Audit Committee. When electing directors who are members of a companys
Audit Committee, or when ratifying a companys auditors, Invesco considers the past
performance of the Committee and holds its members accountable for the quality of the
companys financial statements and reports.
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Majority standard in director elections.
The right to elect directors is the single most
important mechanism shareholders have to promote accountability. Invesco supports the
nascent effort to reform the U.S. convention of electing directors, and votes in favor of
proposals to elect directors by a majority vote.
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Classified boards.
Invesco supports proposals to elect directors annually instead of
electing them to staggered multi-year terms because annual elections increase a boards
level of accountability to its shareholders.
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Supermajority voting requirements.
Unless proscribed by law in the state of
incorporation, Invesco votes against actions that would impose any supermajority voting
requirement, and supports actions to dismantle existing supermajority requirements.
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Responsiveness.
Invesco withholds votes from directors who do not adequately respond to
shareholder proposals that were approved by a majority of votes cast the prior year.
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Cumulative voting.
The practice of cumulative voting can enable minority shareholders to
have representation on a companys board. Invesco supports proposals to institute the
practice of cumulative voting at companies whose overall corporate-governance standards
indicate a particular need to protect the interests of minority shareholders.
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Shareholder access.
On business matters with potential financial consequences, Invesco
votes in favor of proposals that would increase shareholders opportunities to express
their views to boards of directors,
proposals that would lower barriers to shareholder action and proposals to promote the
adoption of generally accepted best practices in corporate governance.
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II. Incentives
Invesco believes properly constructed compensation plans that include equity ownership are
effective in creating incentives that induce managements and employees of our portfolio companies
to create greater shareholder wealth. Invesco supports equity compensation plans that promote the
proper alignment of incentives, and votes against plans that are overly dilutive to existing
shareholders, plans that contain objectionable structural features, and plans that appear likely to
reduce the value of an accounts investment.
Following are specific voting issues that illustrate how Invesco evaluates incentive plans.
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Executive compensation.
Invesco evaluates compensation plans for executives within the
context of the companys performance under the executives tenure. Invesco believes
independent compensation committees are best positioned to craft executive-compensation
plans that are suitable for their company-specific circumstances. We view the election of
those independent compensation committee members as the appropriate mechanism for
shareholders to express their approval or disapproval of a companys compensation
practices. Therefore, Invesco generally does not support shareholder proposals to limit or
eliminate certain forms of executive compensation. In the interest of reinforcing the
notion of a compensation committees accountability to shareholders, Invesco supports
proposals requesting that companies subject each years compensation record to an advisory
shareholder vote, or so-called say on pay proposals.
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Equity-based compensation plans.
When voting to approve or reject equity-based
compensation plans, Invesco compares the total estimated cost of the plans, including stock
options and restricted stock, against a carefully selected peer group and uses multiple
performance metrics that help us determine whether the incentive structures in place are
creating genuine shareholder wealth. Regardless of a plans estimated cost relative to its
peer group, Invesco votes against plans that contain structural features that would impair
the alignment of incentives between shareholders and management. Such features include the
ability to reprice or reload options without shareholder approval, the ability to issue
options below the stocks current market price, or the ability to automatically replenish
shares without shareholder approval.
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Employee stock-purchase plans.
Invesco supports employee stock-purchase plans that are
reasonably designed to provide proper incentives to a broad base of employees, provided
that the price at which employees may acquire stock is at most a 15 percent discount from
the market price.
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Severance agreements.
Invesco generally votes in favor of proposals requiring advisory
shareholder ratification of executives severance agreements. However, we oppose proposals
requiring such agreements to be ratified by shareholders in advance of their adoption.
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III. Capitalization
Examples of management proposals related to a companys capital structure include authorizing or
issuing additional equity capital, repurchasing outstanding stock, or enacting a stock split or
reverse stock split. On requests for additional capital stock, Invesco analyzes the companys
stated reasons for the request. Except where the request could adversely affect the funds
ownership stake or voting rights, Invesco generally supports a boards decisions on its needs for
additional capital stock. Some capitalization proposals require a case-by-case analysis within the
context of Invescos investment thesis on a company. Examples of such proposals include authorizing
common or preferred stock with special voting rights, or issuing additional stock in connection
with an acquisition.
IV. Mergers, Acquisitions and Other Corporate Actions
Issuers occasionally require shareholder approval to engage in certain corporate actions such as
mergers, acquisitions, name changes, dissolutions, reorganizations, divestitures and
reincorporations. Invesco analyzes these proposals within the context of our investment thesis on
the company, and determines its vote on a case-by-case basis.
V. Anti-Takeover Measures
Practices designed to protect a company from unsolicited bids can adversely affect shareholder
value and voting rights, and they create conflicts of interests among directors, management and
shareholders. Except under special issuer-specific circumstances, Invesco votes to reduce or
eliminate such measures. These measures include adopting or renewing poison pills, requiring
supermajority voting on certain corporate actions, classifying the election of directors instead of
electing each director to an annual term, or creating separate classes of common or preferred stock
with special voting rights. Invesco generally votes against management proposals to impose these
types of measures, and generally votes for shareholder proposals designed to reduce such measures.
Invesco supports shareholder proposals directing companies to subject their anti-takeover
provisions to a shareholder vote.
VI. Shareholder Proposals on Corporate Governance
Invesco generally votes for shareholder proposals that are designed to protect shareholder rights
if a companys corporate-governance standards indicate that such additional protections are
warranted.
VII. Shareholder Proposals on Social Responsibility
The potential costs and economic benefits of shareholder proposals seeking to amend a companys
practices for social reasons are difficult to assess. Analyzing the costs and economic benefits of
these proposals is highly subjective and does not fit readily within our framework of voting to
create greater shareholder wealth
over Invescos typical investment horizon. Therefore, Invesco abstains from voting on shareholder
proposals deemed to be of a purely social, political or moral nature.
VIII. Routine Business Matters
Routine business matters rarely have a potentially material effect on the economic prospects of
fund holdings, so we generally support the boards discretion on these items. However, Invesco
votes against proposals where there is insufficient information to make a decision about the nature
of the proposal. Similarly, Invesco votes against proposals to conduct other unidentified business
at shareholder meetings.
Summary
These Guidelines provide an important framework for making proxy-voting decisions, and should give
fund shareholders and other account holders insight into the factors driving Invescos decisions.
The Guidelines cannot address all potential proxy issues, however. Decisions on specific issues
must be made within the context of these Guidelines and within the context of the investment thesis
of the funds and other accounts that own the companys stock. Where a different investment thesis
is held by portfolio managers who may hold stocks in common, Invesco may vote the shares held on a
fund-by-fund or account-by-account basis.
Exceptions
In certain circumstances, Invesco may refrain from voting where the economic cost of voting a
companys proxy exceeds any anticipated benefits of that proxy proposal.
Share-lending programs
One reason that some portion of Invescos position in a particular security might not be voted is
the securities lending program. When securities are out on loan and earning fees for the lending
fund, they are transferred into the borrowers name. Any proxies during the period of the loan are
voted by the borrower. The lending fund would have to terminate the loan to vote the companys
proxy, an action that is not generally in the best economic interest of fund shareholders. However,
whenever Invesco determines that the benefit to shareholders or other account holders of voting a
particular proxy outweighs the revenue lost by terminating the loan, we recall the securities for
the purpose of voting the funds full position.
Share-blocking
Another example of a situation where Invesco may be unable to vote is in countries where the
exercise of voting rights requires the fund to submit to short-term trading restrictions, a
practice known as share-blocking. Invesco generally
refrains from voting proxies in
share-blocking countries unless the portfolio manager determines that the benefit to fund
shareholders and other account holders of voting a specific proxy outweighs the funds or other
accounts temporary inability to sell the security.
International constraints
An additional concern that sometimes precludes our voting non-U.S. proxies is our inability to
receive proxy materials with enough time and enough information to make a voting decision. In the
great majority of instances, however, we are able to vote non-U.S. proxies successfully. It is
important to note that Invesco makes voting decisions for non-U.S. issuers using these Guidelines
as our framework, but also takes into account the corporate-governance standards, regulatory
environment and generally accepted best practices of the local market.
Exceptions to these Guidelines
Invesco retains the flexibility to accommodate company-specific situations where strictly adhering
to the Guidelines would lead to a vote that the Proxy Committee deems not to be in the best
interest of the funds shareholders and other account holders. In these situations, the Proxy
Committee will vote the proxy in the manner deemed to be in the best interest of the funds
shareholders and other account holders, and will promptly inform the funds Boards of Trustees of
such vote and the circumstances surrounding it.
Resolving potential conflicts of interest
A potential conflict of interest arises when Invesco votes a proxy for an issuer with which it also
maintains a material business relationship. Examples could include issuers that are distributors of
Invescos products, or issuers that employ Invesco to manage portions of their retirement plans or
treasury accounts. Invesco reviews each proxy proposal to assess the extent, if any, to which there
may be a material conflict between the interests of the fund shareholders or other account holders
and Invesco.
Invesco takes reasonable measures to determine whether a potential conflict may exist. A potential
conflict is deemed to exist only if one or more of the Proxy Committee members actually knew or
should have known of the potential conflict.
If a material potential conflict is deemed to exist, Invesco may resolve the potential conflict in
one of the following ways: (1) if the proposal that gives rise to the potential conflict is
specifically addressed by the Guidelines, Invesco may vote the proxy in accordance with the
predetermined Guidelines; (2) Invesco may engage an independent third party to determine how the
proxy should be voted; or (3) Invesco may establish an ethical wall or other informational barrier
between the persons involved in the potential conflict and the persons making the proxy-voting
decision in order to insulate the potential conflict from the decision makers.
Because the Guidelines are pre-determined and crafted to be in the best economic interest of
shareholders and other account holders, applying the Guidelines to vote client proxies should, in
most instances, adequately resolve any potential conflict of
interest. As an additional safeguard
against potential conflicts, persons from Invescos marketing, distribution and other
customer-facing functions are precluded from becoming members of the Proxy Committee.
On a quarterly basis, the Invesco Funds Boards of Trustees review a report from Invescos Internal
Compliance Controls Committee. The report contains a list of all known material business
relationships that Invesco maintains with publicly traded issuers. That list is cross-referenced
with the list of proxies voted over the period. If there are any instances where Invescos voting
pattern on the proxies of its material business partners is inconsistent with its voting pattern on
all other issuers, they are brought before the Trustees and explained by the Chairman of the Proxy
Committee.
Personal conflicts of interest.
If any member of the Proxy Committee has a personal conflict of
interest with respect to a company or an issue presented for voting, that Proxy Committee member
will inform the Proxy Committee of such conflict and will abstain from voting on that company or
issue.
Funds of funds
. Some Invesco Funds offering diversified asset allocation within one investment
vehicle own shares in other Invesco Funds. A potential conflict of interest could arise if an
underlying Invesco Fund has a shareholder meeting with any proxy issues to be voted on, because
Invescos asset-allocation funds or target-maturity funds may be large shareholders of the
underlying fund. In order to avoid any potential for a conflict, the asset-allocation funds and
target maturity funds vote their shares in the same proportion as the votes of the external
shareholders of the underlying fund.
C. RECORDKEEPING
Records are maintained in accordance with Invescos Recordkeeping Policy.
Policies and Vote Disclosure
A copy of these Guidelines and the voting record of each Invesco Fund are available on our web
site,
www.invesco.com
. In accordance with Securities and Exchange Commission regulations,
all funds file a record of all proxy-voting activity for the prior 12 months ending June 30th. That
filing is made on or before August 31st of each year.
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ITEM 8.
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PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
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The following individuals are jointly and primarily responsible for the day-to-day management of
the Trust:
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Thomas Byron, Portfolio Manager, who has been responsible for the Trust since 2009 and
has been associated with Invesco and/or its affiliates since 2010. From 1981 to 2010, Mr.
Byron was associated with Morgan Stanley Investment Advisors Inc. in an investment
management capacity.
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Robert Stryker, Portfolio Manager, who has been responsible for the Trust since 2009
and has been with Invesco and/or its affiliates since 2010. From 1994 to 2010, Mr. Stryker
was associated with Morgan Stanley Investment Advisors Inc. in an investment management
capacity.
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Robert Wimmel, Portfolio Manager, who has been responsible for the Trust since 2001 and
has been associated with Invesco and/or its affiliates since 2010. From 1996 to 2010, Mr.
Wimmel was associated with Morgan Stanley Investment Advisors Inc. in an investment
management capacity.
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Portfolio Manager Fund Holdings and Information on Other Managed Accounts
Invescos portfolio managers develop investment models which are used in connection with the
management of certain Invesco Funds as well as other mutual funds for which Invesco or an affiliate
acts as sub-adviser, other pooled investment vehicles that are not registered mutual funds, and
other accounts managed for organizations and individuals. The Investments chart reflects the
portfolio managers investments in the Funds that they manage. Accounts are grouped into three
categories: (i) investments made directly in the Fund, (ii) investments made in an Invesco pooled
investment vehicle with the same or similar objectives and strategies as the Fund, and (iii) any
investments made in any Invesco Fund or Invesco pooled investment vehicle. The Assets Managed
chart reflects information regarding accounts other than the Funds for which each portfolio manager
has day-to-day management responsibilities. Accounts are grouped into three categories: (i) other
registered investment companies, (ii) other pooled investment vehicles and (iii) other accounts.
To the extent that any of these accounts pay advisory fees that are based on account performance
(performance-based fees), information on those accounts is specifically broken out. In addition,
any assets denominated in foreign currencies have been converted into U.S. Dollars using the
exchange rates as of the applicable date.
Investments
The following information is as of February 29, 2012:
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Dollar Range of
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Dollar Range of
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Dollar Range of all Investments
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Portfolio
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Investments in each
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Investments in Invesco
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in Funds and Invesco pooled
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Manager
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Fund
1
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pooled investment vehicles
2
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investment vehicles
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Invesco Van Kampen Select Sector Municipal Trust
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Thomas Byron
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None
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N/A
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$
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100,001-$500,000
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Robert Stryker
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None
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N/A
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$
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100,001-$500,000
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Robert Wimmel
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None
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N/A
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$
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100,000-$500,000
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1
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This column reflects investments in a Funds shares
beneficially owned by a portfolio manager (as determined in accordance with
Rule 16a-1(a) (2) under the Securities Exchange Act of 1934, as amended).
Beneficial ownership includes ownership by a portfolio managers immediate
family members sharing the same household.
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2
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This column reflects portfolio managers investments
made either directly or through a deferred compensation or a similar plan in
Invesco pooled investment vehicles with the same or similar objectives and
strategies as the Fund as of the most recent fiscal year end of the Fund.
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Assets Managed
The following information is as of February 29, 2012:
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Other Registered Investment
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Other Pooled Investment
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Other Accounts
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Portfolio
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Companies Managed (assets
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Vehicles Managed (assets
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Managed (assets in
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Manager
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in millions)
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in millions)
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millions)
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Number of
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Number of
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Number of
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Accounts
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Assets
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Accounts
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Assets
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Accounts
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Assets
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Invesco Van Kampen Select Sector Municipal Trust
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Thomas Byron
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30
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$
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14,322.4
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None
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None
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None
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None
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Robert Stryker
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30
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$
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14,322.4
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None
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None
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None
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None
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Robert Wimmel
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30
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$
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14,322.4
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None
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None
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None
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None
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Potential Conflicts of Interest
Actual or apparent conflicts of interest may arise when a portfolio manager has day-to-day
management responsibilities with respect to more than one Fund or other account. More
specifically, portfolio managers who manage multiple Funds and/or other accounts may be presented
with one or more of the following potential conflicts:
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The management of multiple Funds and/or other accounts may result
in a portfolio manager devoting unequal time and attention to the
management of each Fund and/or other account. The Adviser and
each Sub-Adviser seek to manage such competing interests for the
time and attention of portfolio managers by having portfolio
managers focus on a particular investment discipline. Most other
accounts managed by a portfolio manager are managed using the same
investment models that are used in connection with the management
of the Funds.
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If a portfolio manager identifies a limited investment opportunity
which may be suitable for more than one Fund or other account, a
Fund may not be able to take full advantage of that opportunity
due to an allocation of filled purchase or sale orders across all
eligible Funds and other accounts. To deal with these situations,
the Adviser, each Sub-Adviser and the Funds have adopted
procedures for allocating portfolio transactions across multiple
accounts.
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The Adviser and each Sub-Adviser determine which broker to use to
execute each order for securities transactions for the Funds,
consistent with its duty to seek best execution of the
transaction. However, for certain other accounts (such as mutual
funds for which Invesco or an affiliate acts as sub-adviser, other
pooled investment vehicles that are not registered mutual funds,
and other accounts managed for organizations and individuals), the
Adviser and each Sub-Adviser may be limited by the client with
respect to the selection of brokers or may be instructed to direct
trades through a particular broker. In these cases, trades for a
Fund in a particular security may be placed separately from,
rather than aggregated with, such other accounts. Having separate
transactions with respect to a security may
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temporarily affect the
market price of the security or the execution of the transaction,
or both, to the possible detriment of the Fund or other account(s)
involved.
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Finally, the appearance of a conflict of interest may arise where
the Adviser or Sub-Adviser has an incentive, such as a
performance-based management fee, which relates to the management
of one Fund or account but not all Funds and accounts for which a
portfolio manager has day-to-day management responsibilities.
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The Adviser, each Sub-Adviser, and the Funds have adopted certain compliance procedures which
are designed to address these types of conflicts. However, there is no guarantee that such
procedures will detect each and every situation in which a conflict arises.
Description of Compensation Structure
For the Adviser and each affiliated Sub-Adviser
The Adviser and each Sub-Adviser seek to maintain a compensation program that is competitively
positioned to attract and retain high-caliber investment professionals. Portfolio managers receive
a base salary, an incentive bonus opportunity and an equity compensation opportunity. Portfolio
manager compensation is reviewed and may be modified each year as appropriate to reflect changes in
the market, as well as to adjust the factors used to determine bonuses to promote competitive Fund
performance. The Adviser and each Sub-Adviser evaluate competitive market compensation by reviewing
compensation survey results conducted by an independent third party of investment industry
compensation. Each portfolio managers compensation consists of the following three elements:
Base Salary.
Each portfolio manager is paid a base salary. In setting the base salary, the
Adviser and each Sub-Advisers intention is to be competitive in light of the particular portfolio
managers experience and responsibilities.
Annual Bonus.
The portfolio managers are eligible, along with other employees of the Adviser
and each Sub-Adviser, to participate in a discretionary year-end bonus pool. The Compensation
Committee of Invesco Ltd. reviews and approves the amount of the bonus pool available for the
Adviser and each of the Sub-Advisers investment centers. The Compensation Committee considers
investment performance and financial results in its review. In addition, while having no direct
impact on individual bonuses, assets under management are considered when determining the starting
bonus funding levels. Each portfolio manager is eligible to receive an annual cash bonus which is
based on quantitative (i.e. investment performance) and non-quantitative factors (which may
include, but are not limited to, individual performance, risk management and teamwork).
Each portfolio managers compensation is linked to the pre-tax investment performance of the
Funds/accounts managed by the portfolio manager as described in Table 1 below.
Table 1
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Sub-Adviser
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Performance time period
3
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Invesco
4
Invesco Australia
4
Invesco Deutschland
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One-, Three- and Five-year
performance against Fund peer
group.
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Invesco Advisors- Invesco Real Estate
5
Invesco Senior Secured
4, 6
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Not applicable
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3
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Rolling time periods based on calendar
year-end.
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4
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Portfolio Managers may be granted an
annual deferral award that vests on a pro-rata basis over a four year period
and final payments are based on the performance of eligible Funds selected by
the portfolio manager at the time the award is granted.
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5
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Portfolio Managers for Invesco Global
Real Estate Fund, Invesco Real Estate Fund, Invesco Global Real Estate Income
Fund and Invesco V.I. Global Real Estate Fund base their bonus on new operating
profits of the U.S. Real Estate Division of Invesco.
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Sub-Adviser
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Performance time period
3
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Invesco Canada
4
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One-year performance against Fund
peer group.
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Three- and Five-year performance
against entire universe of
Canadian funds.
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Invesco Hong Kong
4
Invesco Asset Management
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One-, Three- and Five-year
performance against Fund peer
group.
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Invesco Japan
7
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One-, Three- and Five-year
performance against the
appropriate Micropol benchmark.
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High investment performance (against applicable peer group and/or benchmarks) would deliver
compensation generally associated with top pay in the industry (determined by reference to the
third-party provided compensation survey information) and poor investment performance (versus
applicable peer group) would result in low bonus compared to the applicable peer group or no bonus
at all. These decisions are reviewed and approved collectively by senior leadership which has
responsibility for executing the compensation approach across the organization.
Equity-Based Compensation.
Portfolio managers may be granted an annual deferral award that
allows them to select receipt of shares of certain Invesco Funds with a vesting period as well as
common shares and/or restricted shares of Invesco Ltd. stock from pools determined from time to
time by the Compensation Committee of Invesco Ltd.s Board of Directors. Awards of equity-based
compensation typically vest over time, so as to create incentives to retain key talent.
Portfolio managers also participate in benefit plans and programs available generally to all
employees.
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ITEM 9.
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PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND
AFFILIATED PURCHASERS.
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Not applicable.
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ITEM 10.
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SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
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None
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ITEM 11.
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CONTROLS AND PROCEDURES.
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(a)
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As of March 21, 2012, an evaluation was performed under the supervision and with the
participation of the officers of the Registrant, including the PEO and PFO, to assess the
effectiveness of the Registrants disclosure controls and procedures, as that term is defined
in Rule 30a-3(c) under the Investment Company Act of 1940 (the Act), as amended. Based on
that evaluation, the Registrants officers, including the PEO and PFO, concluded that, as of
March 21, 2012, the Registrants disclosure controls and procedures were reasonably designed
to ensure: (1) that information required to be disclosed by the Registrant on Form N-CSR is
recorded, processed, summarized and reported within the time periods specified by the rules
and forms of the Securities and Exchange Commission; and (2) that material information
relating to the Registrant is made known to the PEO and PFO as appropriate to allow timely
decisions regarding required disclosure.
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6
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Invesco Senior Secureds bonus is based
on annual measures of equity return and standard tests of collateralization
performance.
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7
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Portfolio Managers for Invesco Pacific
Growth Funds compensation is based on the one-, three- and five-year
performance against the appropriate Micropol benchmark.
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(b)
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There have been no changes in the Registrants internal control over financial reporting (as
defined in Rule 30a-3(d) under the Act) that occurred during the second fiscal quarter of the
period covered by this report that have materially affected, or are reasonably likely to
materially affect, the Registrants internal control over financial reporting.
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ITEM 12. EXHIBITS.
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12(a) (1)
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Code of Ethics.
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12(a) (2)
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Certifications of principal executive officer and principal financial officer as
required by Rule 30a-2(a) under the Investment Company Act of 1940.
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12(a) (3)
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Not applicable.
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12(b)
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Certifications of principal executive officer and principal financial officer as required by
Rule 30a-2(b) under the Investment Company Act of 1940.
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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: Invesco Van Kampen Select Sector Municipal Trust
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By:
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/s/ Colin Meadows
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Colin Meadows
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Principal Executive Officer
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Date: May 4, 2012
Pursuant to the requirements of the Securities and 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.
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By:
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/s/ Colin Meadows
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Colin Meadows
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Principal Executive Officer
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Date: May 4, 2012
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By:
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/s/ Sheri Morris
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Sheri Morris
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Principal Financial Officer
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Date: May 4, 2012
EXHIBIT INDEX
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12(a)(1)
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Code of Ethics.
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12(a)(2)
|
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Certifications of principal executive officer and principal
Financial officer as required by Rule 30a-2(a) under the
Investment Company Act of 1940.
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12(a)(3)
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Not applicable.
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12(b)
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Certifications of principal executive officer and principal
financial officer as required by Rule 30a-2(b) under the
Investment Company Act of 1940.
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Grafico Azioni Van Kampen Sel Sectr (AMEX:VKL)
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Da Mag 2024 a Giu 2024
Grafico Azioni Van Kampen Sel Sectr (AMEX:VKL)
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