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Re:
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Aquila Narragansett Tax-Free Income Fund (File Nos. 33-48696 and 811-6707)
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Hawaiian Tax-Free Trust (File Nos. 2-92583 and 811-4084)
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Post-Effective Amendments to Registration Statements on Form N-1A
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1.
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Comment:
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The Staff noted that in the Response, the Registrants disagreed with the Staff’s view, set forth in the Original Comments, that Form N-1A and Rule 411 under the Securities Act of 1933 permit only the financial highlights from the Fund’s report to shareholders to be incorporated by reference into the Statutory Prospectus. The Staff reiterated its position and requested that the Registrants revise each Fund’s prospectus accordingly.
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Response:
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Each Registrant confirms that it will revise the applicable Fund’s prospectus to address the Staff’s comment in connection with the next update of such Fund’s registration statement.
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2.
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Comment:
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The Staff noted Hawaiian Tax-Free Trust states that it has a fundamental investment policy, pursuant to which “the Trust cannot buy the obligations of issuers in any one industry if more than 25% of its total assets would then be invested in securities of issuers of that industry; Hawaiian Obligations (except for the industrial development bonds…), U.S. Government Securities and domestic bank obligations are not included in this limit.” The Staff noted that in the Response, Hawaiian Tax-Free Trust acknowledged the Staff’s position that domestic bank obligations may only be excepted by a money market fund from the Fund’s concentration policy, but did not revise the disclosure to address the Staff’s comment.
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Response:
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Hawaiian Tax-Free Trust notes that it did not revise the disclosure to address the Staff’s comment because such disclosure is part of the Fund’s fundamental investment policy, and may not be changed without shareholder approval. Hawaiian Tax-Free Trust notes that the Fund could not invest more than 25% of its total assets in domestic bank obligations without violating the fundamental investment policy that requires it to invest at least 80% of its assets in municipal obligations that pay interest exempt in the opinion of bond counsel from Hawaii state and regular Federal income taxes. Accordingly, Hawaiian Tax-Free Trust respectfully submits that it would not be in the shareholders’ interest to incur the expense of obtaining shareholder approval to revise the disclosure to address the Staff’s comment.
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Re:
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Aquila Narragansett Tax-Free Income Fund (File Nos. 33-48696 and 811-6707)
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Hawaiian Tax-Free Trust (File Nos. 2-92583 and 811-4084)
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Post-Effective Amendments to Registration Statements on Form N-1A
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(a)
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the Registrant is responsible for the adequacy and accuracy of the disclosure in the filings;
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(b)
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Staff comments or changes to disclosure in response to Staff comments in the filings reviewed by the Staff do not foreclose the Commission from taking any action with respect to the filings; and
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(c)
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the Registrant may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
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