WESTERN ASSET PENNSYLVANIA MUNICIPALS FUND
| Schedule of investments (unaudited) (Percentages shown based on Fund net assets) |
December 31, 2023
|
| SECURITY |
RATE | MATURITY DATE |
FACE AMOUNT |
VALUE | ||||||||||||
| MUNICIPAL BONDS - 98.9% | ||||||||||||||||
| Education - 7.1% |
||||||||||||||||
| Montgomery County, PA, IDA, School Revenue: |
||||||||||||||||
| Germantown Academy Project, Series A, Refunding |
4.000 | % | 10/1/36 | $ | 450,000 | $ | 431,210 | |||||||||
| Germantown Academy Project, Series A, Refunding |
4.000 | % | 10/1/41 | 450,000 | 401,967 | |||||||||||
| Germantown Academy Project, Series A, Refunding |
4.000 | % | 10/1/46 | 625,000 | 529,085 | |||||||||||
| Germantown Academy Project, Series A, Refunding |
4.000 | % | 10/1/51 | 800,000 | 651,133 | |||||||||||
| Northampton County, PA, General Purpose Authority, College Revenue, Lafayette College, Refunding |
5.000 | % | 11/1/47 | 1,000,000 | 1,040,740 | |||||||||||
| Pennsylvania State Higher EFA Revenue: |
||||||||||||||||
| La Salle University, Refunding |
5.000 | % | 5/1/29 | 1,500,000 | 1,378,967 | |||||||||||
| Widener University, Series A, Refunding |
4.000 | % | 7/15/46 | 2,300,000 | 2,024,323 | |||||||||||
| Philadelphia, PA, Authority for IDR, Charter School Revenue, Philadelphia Performing Arts: A String Theory Charter School Project, Refunding |
5.000 | % | 6/15/50 | 400,000 | 384,121 | |||||||||||
|
|
|
|||||||||||||||
| Total Education |
6,841,546 | |||||||||||||||
|
|
|
|||||||||||||||
| Health Care - 22.4% |
||||||||||||||||
| Berks County, PA, IDA, Healthcare Facilities Revenue: |
||||||||||||||||
| Highlands at Wyomissing, Refunding |
5.000 | % | 5/15/42 | 500,000 | 485,350 | |||||||||||
| Highlands at Wyomissing, Refunding |
5.000 | % | 5/15/47 | 600,000 | 566,034 | |||||||||||
| Bucks County, PA, IDA, Hospital Authority Revenue: |
||||||||||||||||
| St. Luke’s University Health Network |
4.000 | % | 8/15/33 | 530,000 | 537,806 | |||||||||||
| St. Luke’s University Health Network |
4.000 | % | 8/15/34 | 785,000 | 797,100 | |||||||||||
| St. Luke’s University Health Network |
4.000 | % | 8/15/35 | 500,000 | 506,371 | |||||||||||
| Cumberland County, PA, Municipal Authority Revenue: |
||||||||||||||||
| Diakon Lutheran Social Ministries, Refunding |
5.000 | % | 1/1/29 | 280,000 | 281,698 | |||||||||||
| Diakon Lutheran Social Ministries, Series A, Refunding |
5.000 | % | 1/1/39 | 285,000 | 285,623 | |||||||||||
| Penn State Health |
4.000 | % | 11/1/36 | 1,200,000 | 1,216,155 | |||||||||||
| Lancaster County, PA, Hospital Authority Revenue: |
||||||||||||||||
| Health Center, Landis Homes Retirement Community Project, Refunding |
5.000 | % | 7/1/45 | 3,000,000 | 2,724,383 | |||||||||||
| Penn State Health, Series 2021 |
5.000 | % | 11/1/46 | 1,250,000 | 1,312,735 | |||||||||||
| Lancaster, PA, IDA Revenue, Willow Valley Communities Project |
5.000 | % | 12/1/44 | 1,000,000 | 1,021,253 | |||||||||||
See Notes to Schedule of Investments.
| Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
1 |
WESTERN ASSET PENNSYLVANIA MUNICIPALS FUND
| Schedule of investments (unaudited) (cont’d) (Percentages shown based on Fund net assets) |
December 31, 2023
|
| SECURITY |
RATE | MATURITY DATE |
FACE AMOUNT |
VALUE | ||||||||||||
| Health Care - (continued) |
||||||||||||||||
| Monroe County, PA, Hospital Authority Revenue, Pocono Medical Center, Refunding |
5.000 | % | 7/1/41 | $ | 1,000,000 | $ | 1,015,964 | |||||||||
| Montgomery County, PA, IDA, Retirement Communities Revenue: |
||||||||||||||||
| Acts Retirement-Life Communities, Series A |
5.250 | % | 11/15/53 | 1,315,000 | 1,346,872 | |||||||||||
| Acts Retirement-Life Communities, Series C |
5.000 | % | 11/15/45 | 1,000,000 | 1,019,729 | |||||||||||
| Pennsylvania State Economic Development Financing Authority Revenue: |
||||||||||||||||
| Presbyterian Senior Living Project, Series B-1 |
5.250 | % | 7/1/49 | 250,000 | 255,671 | |||||||||||
| University of Pittsburgh Medical Centre, Series A |
4.000 | % | 5/15/53 | 2,000,000 | 1,955,037 | |||||||||||
| Pennsylvania State Higher EFA Revenue: |
||||||||||||||||
| University of Pennsylvania Health Systems, Series A |
5.000 | % | 8/15/47 | 2,500,000 | 2,586,189 | |||||||||||
| University of Pennsylvania Health Systems, Series B, Refunding |
4.000 | % | 8/15/42 | 1,750,000 | 1,763,655 | |||||||||||
| Southcentral, PA, General Authority Revenue, Wellspan Health Obligated Group, Series A, Refunding |
4.000 | % | 6/1/44 | 1,950,000 | 1,918,985 | |||||||||||
|
|
|
|||||||||||||||
| Total Health Care |
21,596,610 | |||||||||||||||
|
|
|
|||||||||||||||
| Industrial Revenue - 1.1% |
||||||||||||||||
| Commonwealth Financing Authority, PA, Tobacco Master Settlement Payment Revenue, Tobacco Master Settlement Payment |
5.000 | % | 6/1/35 | 1,000,000 | 1,077,166 | |||||||||||
|
|
|
|||||||||||||||
| Leasing - 7.2% |
||||||||||||||||
| Pennsylvania State Economic Development Financing Authority Revenue: |
||||||||||||||||
| Tax-Exempt Private Activity, The Penndot Major Bridges Package One Project |
5.750 | % | 6/30/48 | 1,400,000 | 1,538,670 | (a) | ||||||||||
| Tax-Exempt Private Activity, The Penndot Major Bridges Package One Project |
5.250 | % | 6/30/53 | 300,000 | 314,681 | (a) | ||||||||||
| Philadelphia, PA, Authority for IDR, City Service Agreement Revenue |
5.000 | % | 5/1/37 | 2,000,000 | 2,138,989 | |||||||||||
| Philadelphia, PA, Energy Authority City Service Agreement Revenue: |
||||||||||||||||
| Philadelphia Street Lighting Project, Series A |
5.000 | % | 11/1/42 | 1,000,000 | 1,107,678 | |||||||||||
| Philadelphia Street Lighting Project, Series A |
5.000 | % | 11/1/43 | 700,000 | 773,028 | |||||||||||
See Notes to Schedule of Investments.
|
2 |
Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
WESTERN ASSET PENNSYLVANIA MUNICIPALS FUND
| Schedule of investments (unaudited) (cont’d) (Percentages shown based on Fund net assets) |
December 31, 2023
|
| SECURITY |
RATE | MATURITY DATE |
FACE AMOUNT |
VALUE | ||||||||||||
| Leasing - (continued) |
||||||||||||||||
| State Public School Building Authority, PA, Lease Revenue: |
||||||||||||||||
| Philadelphia SD Project, Series A, Refunding, AGM, State Aid Withholding |
5.000 | % | 6/1/31 | $ | 250,000 | $ | 262,899 | |||||||||
| Philadelphia SD Project, Series A, Refunding, AGM, State Aid Withholding |
5.000 | % | 6/1/33 | 750,000 | 788,910 | |||||||||||
|
|
|
|||||||||||||||
| Total Leasing |
6,924,855 | |||||||||||||||
|
|
|
|||||||||||||||
| Local General Obligation - 7.2% |
||||||||||||||||
| Armstrong, PA, SD, GO: |
||||||||||||||||
| Series A, BAM, State Aid Withholding, Refunding |
4.000 | % | 3/15/36 | 1,075,000 | 1,120,227 | |||||||||||
| Series A, BAM, State Aid Withholding, Refunding |
4.000 | % | 3/15/37 | 1,000,000 | 1,031,998 | |||||||||||
| North Allegheny, PA, SD, GO, State Aid Withholding |
4.000 | % | 5/1/44 | 1,000,000 | 1,008,535 | |||||||||||
| Philadelphia, PA, GO, Series B |
5.000 | % | 2/1/39 | 1,500,000 | 1,620,312 | |||||||||||
| Wilkes-Barre Area SD, PA, GO, BAM, State Aid Withholding, Refunding |
4.000 | % | 4/15/49 | 2,250,000 | 2,209,607 | |||||||||||
|
|
|
|||||||||||||||
| Total Local General Obligation |
6,990,679 | |||||||||||||||
|
|
|
|||||||||||||||
| Power - 4.4% |
||||||||||||||||
| Philadelphia, PA, Gas Works Revenue: |
||||||||||||||||
| 1998 General Ordinance, Refunding |
5.000 | % | 8/1/31 | 1,250,000 | 1,274,088 | |||||||||||
| 1998 General Ordinance, Refunding |
5.000 | % | 8/1/47 | 2,500,000 | 2,574,889 | |||||||||||
| Puerto Rico Electric Power Authority Revenue: |
||||||||||||||||
| Series A |
5.000 | % | 7/1/42 | 450,000 | 118,125 | *(b) | ||||||||||
| Series A |
5.050 | % | 7/1/42 | 70,000 | 18,375 | *(b) | ||||||||||
| Series XX |
5.250 | % | 7/1/40 | 735,000 | 192,938 | *(b) | ||||||||||
| Series ZZ |
— | 7/1/18 | 150,000 | 39,000 | *(c) | |||||||||||
|
|
|
|||||||||||||||
| Total Power |
4,217,415 | |||||||||||||||
|
|
|
|||||||||||||||
| Special Tax Obligation - 3.9% |
||||||||||||||||
| Guam Government, Business Privilege Tax Revenue, Series F, Refunding |
4.000 | % | 1/1/36 | 150,000 | 151,885 | |||||||||||
| Pennsylvania State Turnpike Commission Revenue, Subordinated, Series B |
5.000 | % | 12/1/48 | 2,000,000 | 2,080,852 | |||||||||||
| Puerto Rico Sales Tax Financing Corp., Sales Tax Revenue: |
||||||||||||||||
| CAB, Restructured, Series A-1 |
0.000 | % | 7/1/27 | 200,000 | 174,329 | |||||||||||
| CAB, Restructured, Series A-1 |
0.000 | % | 7/1/46 | 1,140,000 | 358,842 | |||||||||||
| Restructured, Series A-1 |
4.550 | % | 7/1/40 | 50,000 | 50,368 | |||||||||||
| Restructured, Series A-1 |
4.750 | % | 7/1/53 | 415,000 | 411,743 | |||||||||||
| Restructured, Series A-1 |
5.000 | % | 7/1/58 | 185,000 | 186,108 | |||||||||||
| Restructured, Series A-2 |
4.329 | % | 7/1/40 | 330,000 | 328,420 | |||||||||||
|
|
|
|||||||||||||||
| Total Special Tax Obligation |
3,742,547 | |||||||||||||||
|
|
|
|||||||||||||||
See Notes to Schedule of Investments.
| Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
3 |
WESTERN ASSET PENNSYLVANIA MUNICIPALS FUND
| Schedule of investments (unaudited) (cont’d) (Percentages shown based on Fund net assets) |
December 31, 2023
|
| SECURITY |
RATE | MATURITY DATE |
FACE AMOUNT |
VALUE | ||||||||||||
| State General Obligation - 0.8% |
||||||||||||||||
| Puerto Rico Commonwealth, GO: |
||||||||||||||||
| CAB, Restructured, Series A-1 |
0.000 | % | 7/1/24 | $ | 1,524 | $ | 1,494 | |||||||||
| CAB, Restructured, Series A-1 |
0.000 | % | 7/1/33 | 12,094 | 7,556 | |||||||||||
| Restructured, Series A-1 |
5.375 | % | 7/1/25 | 10,466 | 10,702 | |||||||||||
| Restructured, Series A-1 |
5.625 | % | 7/1/27 | 10,372 | 10,979 | |||||||||||
| Restructured, Series A-1 |
5.625 | % | 7/1/29 | 10,203 | 11,082 | |||||||||||
| Restructured, Series A-1 |
5.750 | % | 7/1/31 | 9,910 | 11,044 | |||||||||||
| Restructured, Series A-1 |
4.000 | % | 7/1/33 | 9,398 | 9,223 | |||||||||||
| Restructured, Series A-1 |
4.000 | % | 7/1/35 | 178,447 | 173,001 | |||||||||||
| Restructured, Series A-1 |
4.000 | % | 7/1/37 | 425,000 | 407,002 | |||||||||||
| Restructured, Series A-1 |
4.000 | % | 7/1/41 | 74,857 | 68,906 | |||||||||||
| Restructured, Series A-1 |
4.000 | % | 7/1/46 | 10,251 | 9,169 | |||||||||||
| Subseries CW |
0.000 | % | 11/1/43 | 41,550 | 22,697 | (d) | ||||||||||
|
|
|
|||||||||||||||
| Total State General Obligation |
742,855 | |||||||||||||||
|
|
|
|||||||||||||||
| Transportation - 26.3% |
||||||||||||||||
| Delaware River, PA & NJ, Joint Toll Bridge Commission, Bridge System Revenue Bonds |
5.000 | % | 7/1/42 | 2,000,000 | 2,103,166 | |||||||||||
| Delaware River, PA & NJ, Port Authority Revenue, Series A |
5.000 | % | 1/1/36 | 2,000,000 | 2,203,374 | |||||||||||
| Pennsylvania State Turnpike Commission Revenue: |
||||||||||||||||
| Series A-2 |
5.000 | % | 12/1/43 | 3,000,000 | 3,206,109 | |||||||||||
| Series A-2, Refunding |
5.000 | % | 12/1/48 | 2,000,000 | 2,109,066 | |||||||||||
| Series B |
5.000 | % | 12/1/45 | 3,500,000 | 3,785,236 | |||||||||||
| Series B, Refunding |
5.250 | % | 12/1/52 | 1,000,000 | 1,112,388 | |||||||||||
| Subordinated, Series B, Refunding |
5.000 | % | 6/1/39 | 2,250,000 | 2,315,456 | |||||||||||
| Philadelphia, PA, Airport Revenue: |
||||||||||||||||
| Series A, Refunding |
5.000 | % | 6/15/35 | 3,300,000 | 3,326,652 | (a) | ||||||||||
| Series B, Refunding |
5.000 | % | 7/1/42 | 3,000,000 | 3,088,613 | (a) | ||||||||||
| Pittsburgh & Allegheny County, PA, Sports & Exhibition Authority: |
||||||||||||||||
| Parking System Revenue |
5.000 | % | 12/15/34 | 1,000,000 | 1,064,173 | |||||||||||
| Parking System Revenue |
5.000 | % | 12/15/36 | 1,000,000 | 1,057,694 | |||||||||||
|
|
|
|||||||||||||||
| Total Transportation |
25,371,927 | |||||||||||||||
|
|
|
|||||||||||||||
| Water & Sewer - 18.5% |
||||||||||||||||
| Bucks County, PA, Water and Sewer Authority, Sewer System Revenue, Series A, AGM |
4.000 | % | 12/1/42 | 750,000 | 767,642 | |||||||||||
| Pennsylvania State Economic Development Financing Authority, Sewage Sludge Disposal Revenue: |
||||||||||||||||
| Philadelphia Biosolids Facility, Refunding |
4.000 | % | 1/1/28 | 1,585,000 | 1,596,101 | |||||||||||
See Notes to Schedule of Investments.
|
4 |
Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
WESTERN ASSET PENNSYLVANIA MUNICIPALS FUND
| Schedule of investments (unaudited) (cont’d) (Percentages shown based on Fund net assets) |
December 31, 2023
|
| SECURITY |
RATE | MATURITY DATE |
FACE AMOUNT |
VALUE | ||||||||||||
| Water & Sewer - (continued) |
||||||||||||||||
| Philadelphia Biosolids Facility, Refunding |
4.000 | % | 1/1/29 | $ | 900,000 | $ | 907,758 | |||||||||
| Philadelphia Biosolids Facility, Refunding |
4.000 | % | 1/1/32 | 800,000 | 809,268 | |||||||||||
| Philadelphia, PA, Water & Wastewater Revenue: |
||||||||||||||||
| Series A |
5.000 | % | 10/1/43 | 3,335,000 | 3,537,029 | |||||||||||
| Series A, Refunding |
5.000 | % | 11/1/45 | 1,000,000 | 1,080,182 | |||||||||||
| Puerto Rico Commonwealth Aqueduct & Sewer Authority Revenue, Senior Lien, Series A, Refunding |
5.000 | % | 7/1/47 | 500,000 | 493,197 | (e) | ||||||||||
| Westmoreland County, PA, Municipal Authority Revenue: |
||||||||||||||||
| BAM, Refunding |
5.000 | % | 8/15/42 | 1,500,000 | 1,526,142 | |||||||||||
| CAB, Series B, AGM |
0.000 | % | 8/15/30 | 8,830,000 | 7,073,334 | |||||||||||
|
|
|
|||||||||||||||
| Total Water & Sewer |
17,790,653 | |||||||||||||||
|
|
|
|||||||||||||||
| TOTAL INVESTMENTS BEFORE SHORT-TERM INVESTMENTS |
|
95,296,253 | ||||||||||||||
|
|
|
|||||||||||||||
| SHORT-TERM INVESTMENTS - 0.4% | ||||||||||||||||
| MUNICIPAL BONDS - 0.4% | ||||||||||||||||
| Transportation - 0.4% |
||||||||||||||||
| Pennsylvania State Turnpike Commission Revenue, Second Series, Refunding, LOC - TD Bank N.A. (Cost - $400,000) |
3.750 | % | 12/1/38 | 400,000 | 400,000 | (f)(g) | ||||||||||
|
|
|
|||||||||||||||
| TOTAL INVESTMENTS - 99.3% |
95,696,253 | |||||||||||||||
| Other Assets in Excess of Liabilities - 0.7% |
683,252 | |||||||||||||||
|
|
|
|||||||||||||||
| TOTAL NET ASSETS - 100.0% |
$ | 96,379,505 | ||||||||||||||
|
|
|
|||||||||||||||
See Notes to Schedule of Investments.
| Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
5 |
WESTERN ASSET PENNSYLVANIA MUNICIPALS FUND
| Schedule of investments (unaudited) (cont’d) (Percentages shown based on Fund net assets) |
December 31, 2023
|
| * | Non-income producing security. |
| (a) | Income from this issue is considered a preference item for purposes of calculating the alternative minimum tax (“AMT”). |
| (b) | The coupon payment on this security is currently in default as of December 31, 2023. |
| (c) | The maturity principal is currently in default as of December 31, 2023. |
| (d) | Variable rate security. Interest rate disclosed is as of the most recent information available. Certain variable rate securities are not based on a published reference rate and spread but are determined by the issuer or agent and are based on current market conditions. These securities do not indicate a reference rate and spread in their description above. |
| (e) | Security is exempt from registration under Rule 144A of the Securities Act of 1933. This security may be resold in transactions that are exempt from registration, normally to qualified institutional buyers. This security has been deemed liquid pursuant to guidelines approved by the Board of Trustees. |
| (f) | Variable rate demand obligations (“VRDOs”) have a demand feature under which the Fund can tender them back to the issuer or liquidity provider on no more than 7 days notice. The interest rate generally resets on a daily or weekly basis and is determined on the specific interest rate reset date by the remarketing agent, pursuant to a formula specified in official documents for the VRDO, or set at the highest rate allowable as specified in official documents for the VRDO. VRDOs are benchmarked to the Securities Industry and Financial Markets Association (“SIFMA”) Municipal Swap Index. The SIFMA Municipal Swap Index is compiled from weekly interest rate resets of tax-exempt VRDOs reported to the Municipal Securities Rulemaking Board’s Short-term Obligation Rate Transparency System. |
| (g) | Maturity date shown is the final maturity date. The security may be sold back to the issuer before final maturity. |
Abbreviation(s) used in this schedule:
| AGM | — Assured Guaranty Municipal Corporation — Insured Bonds | |
| BAM | — Build America Mutual — Insured Bonds | |
| CAB | — Capital Appreciation Bonds | |
| EFA | — Educational Facilities Authority | |
| GO | — General Obligation | |
| IDA | — Industrial Development Authority | |
| IDR | — Industrial Development Revenue | |
| LOC | — Letter of Credit | |
| SD | — School District |
This Schedule of Investments is unaudited and is intended to provide information about the Fund’s investments as of the date of the schedule. Other information regarding the Fund is available in the Fund’s most recent annual or semi-annual shareholder report.
See Notes to Schedule of Investments.
|
6 |
Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
Notes to Schedule of Investments (unaudited)
1. Organization and significant accounting policies
Western Asset Pennsylvania Municipals Fund (the “Fund”) is a separate non-diversified investment series of Legg Mason Partners Income Trust (the “Trust”). The Trust, a Maryland statutory trust, is registered under the Investment Company Act of 1940, as amended (the “1940 Act”), as an open-end management investment company.
The Fund follows the accounting and reporting guidance in Financial Accounting Standards Board (“FASB”) Accounting Standards Codification Topic 946, Financial Services – Investment Companies (“ASC 946”). The following are significant accounting policies consistently followed by the Fund and are in conformity with U.S. generally accepted accounting principles (“GAAP”), including, but not limited to, ASC 946.
(a) Investment valuation. The valuations for fixed income securities (which may include, but are not limited to, corporate, government, municipal, mortgage-backed, collateralized mortgage obligations and asset-backed securities) and certain derivative instruments are typically the prices supplied by independent third party pricing services, which may use market prices or broker/dealer quotations or a variety of valuation techniques and methodologies. The independent third party pricing services typically use inputs that are observable such as issuer details, interest rates, yield curves, prepayment speeds, credit risks/spreads, default rates and quoted prices for similar securities. Investments in open-end funds are valued at the closing net asset value per share of each fund on the day of valuation. If independent third party pricing services are unable to supply prices for a portfolio investment, or if the prices supplied are deemed by the manager to be unreliable, the market price may be determined by the manager using quotations from one or more broker/dealers or at the transaction price if the security has recently been purchased and no value has yet been obtained from a pricing service or pricing broker. When reliable prices are not readily available, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded, but before the Fund calculates its net asset value, the Fund values these securities as determined in accordance with procedures approved by the Fund’s Board of Trustees.
Pursuant to policies adopted by the Board of Trustees, the Fund’s manager has been designated as the valuation designee and is responsible for the oversight of the daily valuation process. The Fund’s manager is assisted by the Global Fund Valuation Committee (the “Valuation Committee”). The Valuation Committee is responsible for making fair value determinations, evaluating the effectiveness of the Fund’s pricing policies, and reporting to the Fund’s manager and the Board of Trustees. When determining the reliability of third party pricing information for investments owned by the Fund, the Valuation Committee, among other things, conducts due diligence reviews of pricing vendors, monitors the daily change in prices and reviews transactions among market participants.
The Valuation Committee will consider pricing methodologies it deems relevant and appropriate when making fair value determinations. Examples of possible methodologies
| Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
7 |
Notes to Schedule of Investments (unaudited) (continued)
include, but are not limited to, multiple of earnings; discount from market of a similar freely traded security; discounted cash-flow analysis; book value or a multiple thereof; risk premium/yield analysis; yield to maturity; and/or fundamental investment analysis. The Valuation Committee will also consider factors it deems relevant and appropriate in light of the facts and circumstances. Examples of possible factors include, but are not limited to, the type of security; the issuer’s financial statements; the purchase price of the security; the discount from market value of unrestricted securities of the same class at the time of purchase; analysts’ research and observations from financial institutions; information regarding any transactions or offers with respect to the security; the existence of merger proposals or tender offers affecting the security; the price and extent of public trading in similar securities of the issuer or comparable companies; and the existence of a shelf registration for restricted securities.
For each portfolio security that has been fair valued pursuant to the policies adopted by the Board of Trustees, the fair value price is compared against the last available and next available market quotations. The Valuation Committee reviews the results of such back testing monthly and fair valuation occurrences are reported to the Board of Trustees quarterly.
The Fund uses valuation techniques to measure fair value that are consistent with the market approach and/or income approach, depending on the type of security and the particular circumstance. The market approach uses prices and other relevant information generated by market transactions involving identical or comparable securities. The income approach uses valuation techniques to discount estimated future cash flows to present value.
GAAP establishes a disclosure hierarchy that categorizes the inputs to valuation techniques used to value assets and liabilities at measurement date. These inputs are summarized in the three broad levels listed below:
| • | Level 1 – unadjusted quoted prices in active markets for identical investments |
| • | Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.) |
| • | Level 3 – significant unobservable inputs (including the Fund’s own assumptions in determining the fair value of investments) |
The inputs or methodologies used to value securities are not necessarily an indication of the risk associated with investing in those securities.
|
8 |
Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
Notes to Schedule of Investments (unaudited) (continued)
The following is a summary of the inputs used in valuing the Fund’s assets carried at fair value:
| ASSETS |
||||||||||||||||
| DESCRIPTION |
QUOTED PRICES (LEVEL 1) |
OTHER SIGNIFICANT OBSERVABLE INPUTS (LEVEL 2) |
SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3) |
TOTAL | ||||||||||||
| Municipal Bonds† |
— | $ | 95,296,253 | — | $ | 95,296,253 | ||||||||||
| Short-Term Investments† |
— | 400,000 | — | 400,000 | ||||||||||||
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|
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|
|
|
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| Total Investments |
— | $ | 95,696,253 | — | $ | 95,696,253 | ||||||||||
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|
|
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| † | See Schedule of Investments for additional detailed categorizations. |
| Western Asset Pennsylvania Municipals Fund 2023 Quarterly Report |
9 |