Unassociated Document

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM N-CSRS

CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT

INVESTMENT COMPANIES

Investment Company Act file number 811-4503

AQUILA MUNICIPAL TRUST

(Exact name of Registrant as specified in charter)

120 West 45th Street, Suite 3600

New York, New York 10036

(Address of principal executive offices) (Zip code)

Joseph P. DiMaggio

120 West 45th Street, Suite 3600

New York, New York 10036

(Name and address of agent for service)

Registrant's telephone number, including area code: (212) 697-6666

Date of fiscal year end: 3/31/16

Date of reporting period: 9/30/16

FORM N-CSRS

ITEM 1.

REPORTS TO STOCKHOLDERS.

Semi-Annual

Report

September 30, 2016

Please Save the Date for Your 2017 Shareholder Meeting

Thursday, April 20, 2017

Details will be available on our website as the date approaches:

www.aquilafunds.com

or through your financial professional

Aquila Churchill Tax-Free

Fund of Kentucky

“The Role of Trustees”

Serving Kentucky investors since 1987

November, 2016

Dear Fellow Shareholder:

As you may be aware, the Investment Company Act of 1940 (the “1940 Act”) is the primary federal law governing the structure and operation of mutual funds. It is enforced and regulated by the U.S. Securities and Exchange Commission (the “SEC”) and defines, among other things, certain responsibilities of Trustees.

Under applicable state law, Trustees are charged, as their primary responsibility, with safeguarding the interests of shareholders. As such, your Trustees seek to act in your best interests, putting your interests ahead of their own interests and those of anyone else, in overseeing the policies and procedures of Aquila Churchill Tax-Free Fund of Kentucky (your “Fund”), as well as the services provided by your Fund’s key service providers.

Your Trustees’ key role is to be alert and sensitive to any conflicts of interest. By law, a substantial number of the Trustees must be “independent,” meaning that they have no affiliation with any sponsoring or support organization of the Fund. This requirement is in place in an effort to enhance Trustee impartiality. In order to ensure that your Board of Trustees continually maintains adequate independence, your Trustees complete a questionnaire on an annual basis which is, in turn, reviewed by your Fund’s legal counsel. It is also worthy to note that, at all times, a significant percentage of the Trustees must have been elected by you, the shareholders.

The 1940 Act requires your Board of Trustees to review certain of your Fund’s contracts on at least an annual basis, at which time, the majority of your Trustees, including a majority of the independent Trustees, must be present in person. Moreover, in their review of the contract with your Fund’s adviser, the Trustees seek to consider certain factors and their conclusions are disclosed to you in your Fund’s next annual or semi-annual report (as is the case with this semi-annual report). Your Trustees’ other key responsibilities include oversight of your Fund’s compliance policies and procedures, valuation and risk management.

Your Board of Trustees oversees the business of your Fund through regular quarterly and ad hoc board meetings, committee meetings (which focus on specific subject matters) and frequent communications. These meetings allow Trustees to be brought up-to-date on the affairs of your Fund, ask questions, and deliberate and vote on issues important to your Fund and its shareholders.

Selection and nomination of independent Trustees is by the existing independent Trustees. As detailed in the Nominating Committee Charter which is available on your Fund’s website (www.aquilafunds.com), your Board of Trustees seeks to develop and maintain a board of high quality, independence and integrity to best serve your interests. The Trustees associated with the Aquila Group of Funds are additionally selected on the basis of being accomplished individuals of diverse backgrounds from various parts of the United States, including Kentucky. Through this diversity, we strive to provide your Fund with a broad breadth and balance of knowledge and experience. Biographical and other information on your Board of Trustees is available on our website and, by law, is included in your Fund’s annual report and Statement of Additional Information.

NOT A PART OF THE SEMI-ANNUAL REPORT

Although, not required, Trustees in the Aquila Group of Funds self-impose some additional criteria.

•

In addition to overseeing your Fund, all Trustees are also fellow shareholders. While Trustees, like any investor, must consider, among other things, their own personal investment objectives (including tax benefits afforded the investment by their state of residence) when deciding upon the size of their investment in Aquila Churchill Tax-Free Fund of Kentucky, we believe it is important that each Trustee has “some skin the game.”

•

Consideration is given to including local residents as Trustees. In this way, the Fund can benefit from their hands-on insight and knowledge of their State.

In short, your Board of Trustees are your “watchdogs,” looking over operations of Aquila Churchill Tax-Free Fund of Kentucky.

It has been our experience that those who have undertaken to serve as Trustees diligently devote their energies, talents and experience to furthering the interests of you, our shareholders.

Sincerely,

Diana P. Herrmann, Vice Chair and President

Any information in this Shareholder Letter regarding market or economic trends or the factors influencing the Fund’s historical or future performance are statements of opinion as of the date of this report. These statements should not be relied upon for any other purposes. Past performance is no guarantee of future results, and there is no guarantee that any market forecasts discussed will be realized.

NOT A PART OF THE SEMI-ANNUAL REPORT

Mutual fund investing involves risk and loss of principal is possible.

The market prices of the Fund’s securities may rise or decline in value due to general market conditions, such as real or perceived adverse economic or political conditions, inflation, changes in interest rates, lack of liquidity in the bond markets or adverse investor sentiment. When market prices fall, the value of your investment may go down. In the past several years, financial markets have experienced increased volatility, depressed valuations, decreased liquidity and heightened uncertainty. These conditions may continue, recur, worsen or spread.

The value of your investment may go down when interest rates rise. A rise in interest rates tends to have a greater impact on the prices of longer term securities. Conversely, when interest rates fall, the value of your investment may rise. Interest rates in the U.S. recently have been historically low, so the Fund faces a heightened risk that interest rates may rise. A general rise in interest rates may cause investors to move out of fixed income securities and could also result in increased redemptions from the Fund.

Investments in the Fund are subject to possible loss due to the financial failure of the issuers of underlying securities and their inability to meet their debt obligations.

The value of municipal securities can be adversely affected by changes in the financial condition of one or more individual municipal issuers or insurers of municipal issuers, regulatory developments, legislative actions, and by uncertainties and public perceptions concerning these and other factors. The Fund may be affected significantly by adverse economic, political or other events affecting state and other municipal issuers in which it invests, and may be more volatile than a more geographically diverse fund.

If interest rates fall, an issuer may exercise its right to prepay its securities, and the Fund could be forced to reinvest prepayment proceeds at a time when yields on securities available in the market are lower than the yield on the prepaid security.

A portion of income may be subject to local, state, Federal and/or alternative minimum tax. Capital gains, if any, are subject to capital gains tax.

These risks may result in share price volatility.

Past performance is no guarantee of future results, and there is no guarantee that any market forecasts discussed will be realized.

Any information in this Semi-Annual Report regarding market or economic trends or the factors influencing the Fund’s historical or future performance are statements of opinion as of the date of this report. These statements should not be relied upon for any other purposes.

NOT A PART OF THE SEMI-ANNUAL REPORT

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (5.5%)	Rating Moody’s, S&P and Fitch	Value

		Henderson County, Kentucky
$	330,000	3.000%, 11/01/20	Aa3/NR/NR	$	350,962
		Lexington-Fayette Urban
		County, Kentucky
	3,600,000	4.000%, 09/01/29	Aa2/AA/NR		4,031,712
	4,175,000	4.250%, 05/01/23 NPFG Insured	Aa2/AA/NR		4,185,605
	570,000	4.000%, 08/01/21 Series B	Aa2/AA/NR		644,265
		Rowan County, Kentucky
	400,000	3.000%, 06/01/21 AGMC Insured	A1/AA/NR		428,932
	645,000	3.000%, 06/01/22 AGMC Insured	A1/AA/NR		695,813
	835,000	4.000%, 06/01/30 AGMC Insured	A1/AA/NR		937,262
	865,000	4.000%, 06/01/31 AGMC Insured	A1/AA/NR		963,887
		Warren County, Kentucky
	615,000	4.000%, 06/01/25	Aa2/AA-/NR		683,001
	635,000	4.000%, 06/01/26	Aa2/AA-/NR		703,097
	660,000	4.000%, 06/01/27	Aa2/AA-/NR		729,221
		Total General Obligation Bonds			14,353,757

		Revenue Bonds (74.3%)
		State Agency (17.5%)
		Kentucky Asset & Liability Commission
		Federal Highway Notes
	1,000,000	5.000%, 09/01/22 Series A	A2/AA/A+		1,136,760
	2,000,000	5.250%, 09/01/25 Series A	A2/AA/A+		2,441,780
	2,000,000	5.000%, 09/01/26 Series A	A2/AA/A+		2,441,600
	1,000,000	5.000%, 09/01/27 Series A	A2/AA/A+		1,231,670
		Kentucky Economic Development
		Finance Authority Louisville
		Arena Project
	2,500,000	5.750%, 12/01/28 AGC Insured	A3/AA/NR		2,638,825
		Kentucky Higher Education Student Loan
	400,000	5.000%, 06/01/24 Senior
		Series A AMT	NR/A/A		454,928
	1,235,000	3.750%, 06/01/26 Senior
		Series A AMT	NR/A/A		1,255,871
		Kentucky Rural Water Finance Corp.
	355,000	4.600%, 02/01/25	NR/A+/NR		370,542
	205,000	4.250%, 08/01/19 NPFG Insured	A3/AA-/NR		205,392
	210,000	4.250%, 08/01/20 NPFG Insured	A3/AA-/NR		210,401
	200,000	4.375%, 08/01/22 NPFG Insured	A3/AA-/NR		200,394

1 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		State Agency (continued)
		Kentucky Rural Water Finance Corp.
		(continued)
	240,000	4.500%, 08/01/23 NPFG Insured	A3/AA-/NR	$	240,504
	255,000	4.500%, 08/01/24 NPFG Insured	A3/AA-/NR		255,533
	290,000	4.500%, 08/01/27 NPFG Insured	A3/AA-/NR		290,592
	245,000	4.600%, 08/01/28 NPFG Insured	A3/AA-/NR		245,495
	315,000	4.625%, 08/01/29 NPFG Insured	A3/AA-/NR		315,614
	375,000	4.000%, 02/01/28 Series 2012C	NR/A+/NR		407,846
	305,000	4.000%, 02/01/29 Series 2012C	NR/A+/NR		331,053
	435,000	4.000%, 02/01/26 Series 2012F	NR/A+/NR		482,654
	450,000	4.000%, 02/01/27 Series 2012F	NR/A+/NR		496,890
	465,000	4.000%, 02/01/28 Series 2012F	NR/A+/NR		512,463
	490,000	4.000%, 02/01/29 Series 2012F	NR/A+/NR		538,716
		Kentucky State Office Building COP
	1,640,000	5.000%, 06/15/34	Aa3/NR/NR		1,938,874
		Kentucky State Property and Buildings
		Commission
	1,020,000	5.000%, 11/01/20	Aa3/A/A+		1,100,182
	1,000,000	5.000%, 10/01/25	Aa3/A/A+		1,207,080
	625,000	4.000%, 04/01/26 Project 105	A1/A/A+		701,525
	655,000	4.000%, 04/01/27 Project 105	A1/A/A+		730,122
	1,500,000	5.000%, 10/01/29 Project 106	Aa3/A/A+		1,783,530
	3,000,000	5.000%, 08/01/33 Project 108	Aa3/A/A+		3,535,770
	5,000,000	5.000%, 08/01/32 Project 110	Aa3/A/A+		5,914,450
	2,500,000	5.000%, 02/01/31 Project 112	Aa3/A/A+		2,989,200
	845,000	3.000%, 04/01/20 Project 113	A1/A/A+		892,658
	875,000	3.000%, 04/01/21 Project 113	A1/A/A+		932,951
	895,000	3.000%, 04/01/22 Project 113	A1/A/A+		961,078
	1,055,000	2.500%, 10/01/21 Project 114	Aa3/A/A+		1,109,164
	1,510,000	3.000%, 10/01/22 Project 114	Aa3/A/A+		1,627,584
	1,400,000	4.000%, 10/01/30 Project 114	Aa3/A/A+		1,558,410
	870,000	4.000%, 10/01/31 Project 114	Aa3/A/A+		962,020
	170,000	5.375%, 11/01/23 Unrefunded balance	Aa3/A/NR		184,629
	85,000	5.500%, 11/01/28 Unrefunded balance	Aa3/A/NR		92,494
	320,000	5.250%, 02/01/28 Unrefunded balance
		AGC Insured	NR/AA/NR		348,662
	340,000	5.000%, 02/01/29 Unrefunded balance
		AGC Insured	NR/AA/NR		367,540
		Total State Agency			45,643,446

2 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Airports (5.2%)
		Lexington-Fayette Urban County Airport
		Board, Kentucky
$	1,555,000	5.000%, 07/01/28 2012 Series A AMT	Aa2/AA/NR	$	1,835,351
	400,000	5.000%, 07/01/29 2012 Series A AMT	Aa2/AA/NR		471,396
	1,350,000	5.000%, 07/01/30 2012 Series A AMT	Aa2/AA/NR		1,588,532
	750,000	5.000%, 07/01/31 2012 Series A AMT	Aa2/AA/NR		881,175
		Louisville, Kentucky Regional Airport
		Authority
	2,070,000	5.000%, 07/01/23 AMT	NR/A+/A+		2,501,699
	2,325,000	5.000%, 07/01/26 AMT	NR/A+/A+		2,795,022
	2,895,000	5.000%, 07/01/27 Series A AMT	NR/A+/A+		3,439,376
		Total Airports			13,512,551

		Higher Education (6.4%)
		Boyle County, Kentucky College
		Refunding & Improvement
	1,035,000	4.500%, 06/01/22 AGC Insured	A3/AA/NR		1,057,221
	200,000	4.625%, 06/01/24 AGC Insured	A3/AA/NR		204,430
		Eastern Kentucky University
		General Receipts
	1,250,000	4.000%, 10/01/27	Aa3/A/NR		1,371,875
	870,000	4.500%, 04/01/32 Series A	Aa3/NR/NR		1,005,224
		Kentucky Bond Development Corp.
		Industrial Building Revenue Refunding,
		City of Paris (Transylvania University
		Project)
	380,000	3.000%, 03/01/20 Series D	NR/A-/NR		400,277
	390,000	3.000%, 03/01/21 Series D	NR/A-/NR		415,705
	400,000	3.000%, 03/01/22 Series D	NR/A-/NR		425,660
		Lexington-Fayette, Kentucky Urban
		County Government Transylvania
		University Project
	1,390,000	4.500%, 03/01/29	NR/A-/NR		1,538,925
		Morehead State University, Kentucky
		General Receipts
	1,000,000	5.000%, 04/01/29 Series A	Aa3/NR/NR		1,216,600
	1,000,000	4.000%, 04/01/31 Series A	Aa3/NR/NR		1,118,960

3 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Higher Education (continued)
		Murray State University Project,
		Kentucky General Receipts
$	1,850,000	4.500%, 03/01/30 Series A	Aa3/NR/NR	$	2,124,355
		Northern Kentucky University
		General Receipts
	1,095,000	4.000%, 09/01/21 Series B	Aa3/NR/NR		1,233,386
	1,190,000	4.000%, 09/01/22 Series B	Aa3/NR/NR		1,359,694
		University of Kentucky General Receipts
	2,000,000	4.000%, 04/01/33	Aa2/AA/NR		2,221,700
		University of Louisville, Kentucky
		General Receipts
	1,000,000	5.000%, 09/01/30 2011 Series A	Aa3/AA-/NR		1,160,810
		Total Higher Education			16,854,822

		Hospital (15.2%)
		City of Ashland, Kentucky, Medical
		Center (Ashland Hospital Corp.)
	2,000,000	5.000%, 02/01/22 Series B	Baa2/BBB/A-		2,195,940
	2,535,000	5.000%, 02/01/23 Series B	Baa2/BBB/A-		2,766,243
	805,000	4.000%, 02/01/32 Series 2016A	Baa2/BBB/A-		847,230
	2,035,000	4.000%, 02/01/36 Series 2016A	Baa2/BBB/A-		2,110,336
		Hardin County, Kentucky, Hardin
		Memorial Hospital
	735,000	5.500%, 08/01/22 AGMC Insured	A2/AA/NR		877,928
	675,000	5.500%, 08/01/23 AGMC Insured	A2/AA/NR		822,541
	500,000	5.250%, 08/01/24 AGMC Insured	A2/AA/NR		598,555
		Kentucky Bond Development Corp.
		Hospital Facilities Revenue Refunding
		(St. Elizabeth Medical Center, Inc.)
	1,810,000	4.000%, 05/01/32	NR/AA/AA		2,012,123
		Kentucky Economic Development
		Finance Authority, Baptist Healthcare
		System
	4,795,000	5.375%, 08/15/24	A3/NR/A+		5,161,338
		Kentucky Economic Development
		Finance Authority, Catholic Health
	2,500,000	2.700%, 05/01/39 Series B	A3/A-/BBB+		2,606,600

4 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Hospital (continued)
		Kentucky Economic Development
		Finance Authority, Kings Daughter
		Medical Center
$	1,000,000	5.000%, 02/01/30	Baa2/BBB/A-	$	1,071,920
		Louisville & Jefferson County, Kentucky
		Metropolitan Government Health
		System, Norton Healthcare, Inc.
	1,100,000	5.000%, 10/01/30	NR/A-/A		1,100,000
	3,500,000	4.000%, 10/01/34 Series A	NR/A-/A		3,844,540
		Louisville & Jefferson County, Kentucky
		Metropolitan Government, Louisville
		Medical Center, Laundry Facility
		Project
	695,000	4.250%, 05/01/23 Series 2012	NR/A-/NR		775,314
		Louisville & Jefferson County, Kentucky
		Metropolitan Government, Louisville
		Medical Center, Steam & Chilled
		Water Plant Project
	915,000	4.250%, 05/01/22 Series 2012A	NR/A-/NR		1,035,414
		Louisville & Jefferson County, Kentucky
		Metropolitan Government Revenue
		Refunding, Catholic Health Initiatives
	1,000,000	5.000%, 12/01/30	A3/A-/BBB+		1,120,410
	650,000	5.000%, 12/01/35
		Unrefunded balance	A3/A-/NR		718,562
		Russell, Kentucky Bon Secours
		Health System
	3,100,000	5.000%, 11/01/26 Series 2013	A2/A-/A		3,697,649
		Warren County, Kentucky, Warren
		County Community Hospital Corp.
	4,975,000	5.000%, 04/01/28	NR/A+/NR		5,722,146
	680,000	4.000%, 10/01/29	NR/A+/NR		726,641
		Total Hospital			39,811,430

		Housing (1.4%)
		Kentucky Housing Corporation
		Housing Revenue
	30,000	4.500%, 07/01/25	Aaa/AAA/NR		30,049

5 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Housing (continued)
		Kentucky Housing Corporation
		Housing Revenue (continued)
$	600,000	4.750%, 07/01/26	Aaa/AAA/NR	$	636,882
	1,570,000	4.800%, 07/01/22 AMT	Aaa/AAA/NR		1,586,140
		Kentucky Housing Multifamily
		Mortgage Revenue
	1,310,000	5.000%, 06/01/35 AMT	NR/NR/NR*		1,316,000
		Total Housing			3,569,071

		Local Public Property (7.6%)
		Boyd County, Kentucky Capital Projects
		Corp., Revenue Refunding, First
		Mortgage, Court Facilities Project
	655,000	3.000%, 08/01/21	Aa3/NR/NR		699,586
		Jefferson County, Kentucky Capital
		Projects
	1,575,000	4.250%, 06/01/23 AGMC Insured	Aa3/NR/AA+		1,605,634
	1,950,000	4.375%, 06/01/24 AGMC Insured	Aa3/NR/AA+		1,989,370
	1,640,000	4.375%, 06/01/28 AGMC Insured	Aa3/NR/AA+		1,672,029
	2,060,000	4.375%, 06/01/26 Series A AGMC
		Insured	Aa3/NR/AA+		2,101,324
	1,070,000	4.375%, 06/01/27 Series A AGMC
		Insured	Aa3/NR/AA+		1,091,111
		Kentucky Association of Counties
		Finance Corp. Financing Program
	1,145,000	4.250%, 02/01/24	NR/AA-/NR		1,263,324
	515,000	4.000%, 02/01/25	NR/AA-/NR		576,692
	315,000	5.375%, 02/01/27	NR/AA-/NR		371,832
	330,000	5.375%, 02/01/28	NR/AA-/NR		388,007
	315,000	3.000%, 02/01/21 Series B	NR/AA-/NR		334,971
	350,000	4.000%, 02/01/22 Series B	NR/AA-/NR		394,212
		Kentucky Bond Corp. Financing Program
	915,000	5.125%, 02/01/28	NR/AA-/NR		1,052,460
		Lexington-Fayette Urban County,
		Kentucky Public Facilities
	500,000	4.125%, 10/01/23 NPFG Insured	Aa3/NR/NR		501,225
	500,000	4.250%, 10/01/26 NPFG Insured	Aa3/NR/NR		501,270

6 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Local Public Property (continued)
		Louisville & Jefferson County, Kentucky
		Visitors & Convention Commission,
		Kentucky International
		Convention Center
$	3,090,000	4.000%, 06/01/20	A2/A/NR	$	3,372,982
		River City Parking Authority of
		River City, Inc., Kentucky First
		Mortgage
	1,000,000	4.750%, 06/01/27 2013 Series B	Aa2/AA/NR		1,171,230
		Wolfe County, Kentucky Public Properties
		Corp., First Mortgage Revenue Refunding,
		Justice Center Project
	615,000	4.000%, 04/01/23	Aa3/NR/NR		699,532
		Total Local Public Property			19,786,791

		School Building (8.9%)
		Bullitt County, Kentucky School District
		Finance Corp.
	1,145,000	4.500%, 04/01/27	Aa3/NR/NR		1,198,506
	1,200,000	4.500%, 04/01/28	Aa3/NR/NR		1,255,536
		Campbell County, Kentucky School
		District Finance Corp. School Building
	340,000	3.500%, 08/01/22	Aa3/NR/NR		371,181
		Fayette County, Kentucky School
		District Finance Corp.
	3,000,000	5.000%, 08/01/31	Aa3/A+/NR		3,614,100
	515,000	4.000%, 08/01/33 Series 2015 D	Aa3/A+/NR		564,265
	1,000,000	5.000%, 10/01/27 Series A	A1/A+/NR		1,185,450
	750,000	4.250%, 06/01/29 Series A	A1/A+/NR		821,145
		Franklin County, Kentucky School
		District Finance Corp.
	1,560,000	4.000%, 06/01/29	Aa3/NR/NR		1,719,869
	1,135,000	4.000%, 04/01/24 Second Series	Aa3/NR/NR		1,310,062
		Jefferson County, Kentucky School
		District Finance Corp.
	1,975,000	3.000%, 07/01/22 Series A	Aa3/AA-/NR		2,145,225
	805,000	5.000%, 04/01/28 Series A	Aa3/AA-/NR		984,249
	1,075,000	4.500%, 04/01/32 Series A	Aa3/AA-/NR		1,241,195

7 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		School Building (continued)
		Jefferson County, Kentucky School
		District Finance Corp. (continued)
$	4,000,000	4.000%, 07/01/26 Series B	Aa3/AA-/NR	$	4,542,440
		Logan County, Kentucky School
		District Finance Corp., Energy
		Conservation Revenue Bonds
	575,000	4.000%, 04/01/33 Series 2016	Aa3/NR/NR		632,149
	615,000	4.000%, 04/01/34 Series 2016	Aa3/NR/NR		673,972
		Shelby County, Kentucky School District
		Finance Corp. School Building
	915,000	3.000%, 02/01/21†††	Aa3/NR/NR		975,518
		Total School Building			23,234,862

		Turnpike/Highway (4.6%)
		Kentucky State Turnpike Authority
	5,000,000	5.000%, 07/01/29 Series A	Aa2/AA-/A+		5,904,450
	4,030,000	5.000%, 07/01/30 Series A	Aa2/AA-/A+		4,897,498
	1,000,000	5.000%, 07/01/30 Series A	Aa2/AA-/A+		1,179,090
		Total Turnpike/Highway			11,981,038

		Utilities (7.5%)
		Campbell & Kenton Counties, Kentucky
		(Sanitation District)
	2,370,000	4.000%, 08/01/27	Aa3/AA/NR		2,586,476
	1,695,000	4.300%, 08/01/24 NPFG Insured	Aa3/AA/NR		1,699,356
	300,000	4.300%, 08/01/27 NPFG Insured	Aa3/AA/NR		300,735
	1,450,000	4.300%, 08/01/28 NPFG Insured	Aa3/AA/NR		1,453,045
		Kentucky State Municipal Power Agency,
		Prairie St. Project
	1,000,000	5.000%, 09/01/23 AGMC Insured	A2/AA/NR		1,134,310
		Louisville & Jefferson County, Kentucky
		Metropolitan Sewer District
	500,000	5.000%, 05/15/28 Series A	Aa3/AA/AA-		585,245
	1,920,000	4.500%, 05/15/30 Series A	Aa3/AA/NR		2,265,120
		Northern Kentucky Water District
	1,000,000	5.000%, 02/01/26	Aa3/NR/NR		1,174,460
	1,825,000	6.000%, 02/01/28 AGMC Insured	Aa3/NR/NR		1,990,035

8 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value
		Utilities (continued)
		Owensboro, Kentucky Electric, Light
		and Power
$	1,000,000	5.000%, 01/01/21 AGMC Insured	A2/AA/NR	$	1,112,580
	3,500,000	5.000%, 01/01/26 AGMC Insured
		Series B	A2/AA/NR		3,892,840
		Owensboro, Kentucky Water Revenue
	350,000	5.000%, 09/15/27 Unrefunded balance
		AGC Insured	A1/NR/NR		375,344
		Owensboro-Daviess County, Kentucky
		Regional Water Resource Agency
		Wastewater Refunding & Improvement
	930,000	4.375%, 01/01/27 Series A
		Syncora Guarantee, Inc. Insured	NR/A+/NR		936,780
		Total Utilities			19,506,326
		Total Revenue Bonds			193,900,337

		Pre-Refunded Bonds (19.3%)††
		Pre-Refunded General
		Obligation Bonds (0.4%)
		Louisville & Jefferson County, Kentucky
	955,000	4.200%, 11/01/22 NPFG Insured	Aa1/AA+/AAA		957,388

		Pre-Refunded Revenue Bonds (18.9%)
		State Agency (5.9%)
		Kentucky Asset & Liability Commission
		University of Kentucky Project
	500,000	5.000%, 10/01/25 Series B	Aa2/AA/NR		520,745
	750,000	5.000%, 10/01/26 Series B	Aa2/AA/NR		781,117
	1,000,000	5.000%, 10/01/27 Series B	Aa2/AA/NR		1,041,490
		Kentucky State Property and Buildings
		Commission
	1,205,000	5.375%, 11/01/23 Project 90	NR/NR/NR		1,314,149
	665,000	5.500%, 11/01/28 Project 90	NR/NR/NR		726,938
	2,820,000	5.750%, 04/01/24 Project 91	A1/A/A+		3,023,125
	2,625,000	5.750%, 04/01/29 Project 91	A1/A/A+		2,814,079
	2,480,000	5.250%, 02/01/28 Project 93
		AGC Insured	NR/AA/NR		2,726,735

9 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded Bonds (continued)	Rating Moody’s, S&P and Fitch	Value
		State Agency (continued)
		Kentucky State Property and Buildings
		Commission (continued)
$	2,160,000	5.000%, 02/01/29 Project 93 AGC
		Insured	NR/AA/NR	$	2,362,522
		Total State Agency			15,310,900

		Airports (0.8%)
		Louisville, Kentucky Regional
		Airport Authority
	1,060,000	5.000%, 07/01/18 AMT	NR/A+/A+		1,131,370
	1,000,000	5.250%, 07/01/23 AGMC
		Insured AMT	NR/NR/A+		1,070,730
		Total Airports			2,202,100

		Higher Education (4.0%)
		Murray State University Project,
		Kentucky General Receipts
	745,000	4.500%, 09/01/23 AMBAC Insured	Aa3/A/NR		769,607
		University of Kentucky General Receipts
	885,000	4.500%, 10/01/22
		Syncora Guarantee, Inc. Insured	Aa2/AA/NR		885,000
	1,545,000	4.500%, 10/01/23
		Syncora Guarantee, Inc. Insured	Aa2/AA/NR		1,545,000
	1,625,000	4.500%, 10/01/25
		Syncora Guarantee, Inc. Insured	Aa2/AA/NR		1,625,000
	1,010,000	4.500%, 10/01/26
		Syncora Guarantee, Inc. Insured	Aa2/AA/NR		1,010,000
		Western Kentucky University
		General Receipts
	2,000,000	4.200%, 09/01/25 Series A NPFG
		Insured	Aa3/AA-/NR		2,060,660
	2,475,000	4.200%, 09/01/26 Series A NPFG
		Insured	Aa3/AA-/NR		2,550,067
		Total Higher Education			10,445,334

		Hospital (0.8%)
		Louisville & Jefferson County, Kentucky
		Metropolitan Government Revenue,
		Catholic Health Initiatives
	1,715,000	5.000%, 12/01/35	NR/NR/NR*		2,069,250

10 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Local Public Property (0.5%)
		Grant County, Kentucky Public Property
		Corp. Justice Center Project
$	1,000,000	4.500%, 12/01/24	Aa3/NR/NR	$	1,041,990
		Laurel County, Kentucky Public
		Property Corp. Justice Center Project
	250,000	4.625%, 03/01/28	Aa3/NR/NR		263,085
		Total Local Public Property			1,305,075

		School Building (3.3%)
		Boone County, Kentucky School District
		Finance Corp. School Building
		Revenue
	1,250,000	4.125%, 03/01/25 AGMC Insured	Aa3/NR/NR		1,266,787
		Kenton County, Kentucky School
		District Finance Corp.
	590,000	4.250%, 10/01/22 AGMC Insured	Aa3/NR/NR		590,000
		Ohio County, Kentucky School
		Building Revenue
	790,000	4.500%, 05/01/24	Aa3/NR/NR		834,682
	325,000	4.500%, 05/01/25	Aa3/NR/NR		343,382
		Oldham County, Kentucky School
		District Finance Corp.
	1,000,000	4.500%, 09/01/27 NPFG Insured	Aa3/NR/NR		1,033,030
		Owensboro, Kentucky Independent
		School District Finance Corp. School
		Building Revenue
	890,000	4.375%, 09/01/24	Aa3/NR/NR		948,473
		Pendleton County, Kentucky School
		District Finance Corp. School
		Building Revenue
	730,000	4.000%, 02/01/23 NPFG Insured	Aa3/NR/NR		737,497
		Pike County, Kentucky School Building
		Revenue
	1,355,000	4.375%, 10/01/26 NPFG Insured	Aa3/NR/NR		1,402,208
		Spencer County, Kentucky School
		District Finance Corp., School
		Building Revenue
	1,000,000	4.500%, 08/01/27 AGMC Insured	Aa3/NR/NR		1,030,000

11 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded Bonds (continued)	Rating Moody’s, S&P and Fitch			Value

		School Building (continued)
		Warren County, Kentucky School
		District Finance Corp.
$	500,000	4.375%, 04/01/27 AGMC Insured	Aa3/NR/NR			$	525,870
		Total School Building					8,711,929

		Turnpike/Highway (3.5%)
		Kentucky State Turnpike Authority
	3,500,000	5.000%, 07/01/25	Aa2/AA-/A+				3,883,285
	1,000,000	5.000%, 07/01/25	Aa2/AA-/A+				1,070,930
	2,750,000	5.000%, 07/01/27	Aa2/AA-/A+				2,945,057
	1,100,000	5.000%, 07/01/28	Aa2/AA-/A+				1,178,023
		Total Turnpike/Highway					9,077,295

		Utilities (0.1%)
		Owensboro, Kentucky Water Revenue
	150,000	5.000%, 09/15/27 AGC Insured	A1/NR/NR				161,706
		Total Pre-Refunded Revenue Bonds					49,283,589
		Total Pre-Refunded Bonds					50,240,977
		Total Municipal Bonds (cost $246,388,004)					258,495,071

Shares		Short-Term Investment (1.1%)
	2,921,275	Dreyfus Tax Exempt Cash Management,
		Institutional Shares, 0.55%**
		(cost $2,921,275)	NR/Aaam/NR				2,921,275
		Total Investments
		(cost $249,309,279-note 4)		100.2	%		261,416,346
		Other assets less liabilities		(0.2	)		(439,664	)
		Net Assets		100.0	%	$	260,976,682

		Portfolio Distribution By Quality Rating				Percent of Investments†
		Aaa of Moody’s or AAA of S&P					0.9	%
		Pre-refunded bonds††					19.4
		Aa of Moody’s or AA of S&P or Fitch					54.9
		A of Moody’s or S&P or Fitch					24.3
		Not Rated*					0.5
							100.0	%

12 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

PORTFOLIO ABBREVIATIONS:
		AGC - Assured Guaranty Corp.
		AGMC - Assured Guaranty Municipal Corp.
		AMBAC - American Municipal Bond Assurance Corp.
		AMT - Alternative Minimum Tax
		COP - Certificates of Participation
		NPFG - National Public Finance Guarantee
		NR - Not Rated

*		Any security not rated (“NR”) by any of the Nationally Recognized Statistical Rating Organizations (“NRSRO”) has been determined by the Investment Adviser to have sufficient quality to be ranked in the top credit four ratings if a credit rating were to be assigned by a NRSRO.

**		The rate is an annualized seven-day yield at period end.

†		Where applicable, calculated using the highest rating of the three NRSROs.

††		Pre-refunded bonds are bonds secured by an escrow account, comprised of U.S. Government Obligations (unless otherwise noted), to retire the bonds at their earliest call date.

†††		Security purchased on a delayed delivery or when-issued basis.

See accompanying notes to financial statements.

13 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

STATEMENT OF ASSETS AND LIABILITIES

SEPTEMBER 30, 2016 (unaudited)

ASSETS
Investments at value (cost $249,309,279)	$	261,416,346
Interest receivable		2,984,296
Receivable for Fund shares sold		26,997
Other assets		19,604
Total assets		264,447,243
LIABILITIES
Payable for investment securities purchased		3,087,575
Payable for Fund shares redeemed		54,347
Dividends payable		178,451
Management fee payable		91,174
Distribution and service fees payable		2,666
Accrued expenses payable		56,348
Total liabilities		3,470,561

NET ASSETS	$	260,976,682
Net Assets consist of:
Capital Stock - Authorized an unlimited number of shares,
par value $0.01 per share	$	239,757
Additional paid-in capital		248,879,706
Net unrealized appreciation on investments (note 4)		12,107,067
Undistributed net investment income		236,657
Accumulated net realized loss on investments		(486,505	)
	$	260,976,682
CLASS A
Net Assets	$	196,566,331
Capital shares outstanding		18,059,196
Net asset value and redemption price per share	$	10.88
Maximum offering price per share (100/96 of $10.88)	$	11.33

CLASS C
Net Assets	$	10,112,477
Capital shares outstanding		929,586
Net asset value and offering price per share	$	10.88
Redemption price per share (*a charge of 1% is imposed on the
redemption proceeds, or on the original price, whichever is
lower, if redeemed during the first 12 months after purchase)	$	10.88	*
CLASS I
Net Assets	$	8,594,989
Capital shares outstanding		790,004
Net asset value, offering and redemption price per share	$	10.88
CLASS Y
Net Assets	$	45,702,885
Capital shares outstanding		4,196,903
Net asset value, offering and redemption price per share	$	10.89

See accompanying notes to financial statements.

14 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

STATEMENT OF OPERATIONS

SIX MONTHS ENDED SEPTEMBER 30, 2016 (unaudited)

Investment Income:

Interest income				$	4,669,895

Expenses:

Management fee (note 3)	$	529,773
Distribution and service fees (note 3)		203,640
Transfer and shareholder servicing agent
fees (note 3)		87,731
Trustees’ fees and expenses (note 7)		47,466
Legal fees		27,261
Fund accounting fees		19,646
Auditing and tax fees		10,562
Shareholders’ reports		6,443
Insurance		5,599
Registration fees and dues		5,561
Chief compliance officer services (note 3)		4,491
Custodian fees		4,367
Miscellaneous		17,322
Total expenses					969,862
Net investment income					3,700,033

Realized and Unrealized Gain (Loss) on Investments:

Net realized gain (loss) from securities
transactions		221,048
Change in unrealized appreciation on
investments		(20,783	)

Net realized and unrealized gain (loss) on
investments					200,265
Net change in net assets resulting from
operations				$	3,900,298

See accompanying notes to financial statements.

15 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

STATEMENTS OF CHANGES IN NET ASSETS

	Six Months Ended
	September 30, 2016			Year Ended
	(unaudited)			March 31, 2016
OPERATIONS:
Net investment income	$	3,700,033		$	7,213,387
Net realized gain (loss) from
securities transactions		221,048			256,955
Change in unrealized appreciation
on investments		(20,783	)		(908,663	)
Change in net assets from
operations		3,900,298			6,561,679

DISTRIBUTIONS TO SHAREHOLDERS (note 10):
Class A Shares:
Net investment income		(2,741,590	)		(5,606,743	)

Class C Shares:
Net investment income		(100,801	)		(218,711	)

Class I Shares:
Net investment income		(115,214	)		(237,826	)

Class Y Shares:
Net investment income		(724,481	)		(1,143,110	)
Change in net assets from
distributions		(3,682,086	)		(7,206,390	)

CAPITAL SHARE TRANSACTIONS (note 7):
Proceeds from shares sold		22,037,398			42,879,350
Reinvested dividends and
distributions		2,299,106			4,664,954
Cost of shares redeemed		(18,167,277	)		(29,466,029	)
Change in net assets from capital
share transactions		6,169,227			18,078,275

Change in net assets		6,387,439			17,433,564

NET ASSETS:
Beginning of period		254,589,243			237,155,679

End of period*	$	260,976,682		$	254,589,243

*Includes undistributed net investment income of:	$	236,657		$	218,710

See accompanying notes to financial statements.

16 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2016 (unaudited)

1. Organization

Aquila Churchill Tax-Free Fund of Kentucky (the “Fund”), a series of Aquila Municipal Trust (prior to October 12, 2013, the Fund operated under the name Churchill Tax-Free Fund of Kentucky), a non-diversified, open-end investment company, was organized in March, 1987 as a Massachusetts business trust and commenced operations on May 21, 1987. The Fund is authorized to issue an unlimited number of shares. Class A Shares are sold at net asset value plus a sales charge of varying size (depending upon a variety of factors) paid at the time of purchase and bear a distribution fee. Class C Shares are sold at net asset value with no sales charge payable at the time of purchase but with a level charge for service and distribution fees for six years thereafter. Class C Shares automatically convert to Class A Shares after six years. Class Y Shares are sold only through authorized financial institutions acting for investors in a fiduciary, advisory, agency, custodial or similar capacity and are not offered directly to retail customers. Class Y Shares are sold at net asset value with no sales charge, no redemption fee, no contingent deferred sales charge (“CDSC”) and no distribution fee. Class I Shares are offered and sold only through financial intermediaries and are not offered directly to retail customers. Class I Shares are sold at net asset value with no sales charge and no redemption fee or CDSC, although a financial intermediary may charge a fee for effecting a purchase or other transaction on behalf of its customers. Class I Shares carry a distribution and a service fee. All classes of shares represent interests in the same portfolio of investments and are identical as to rights and privileges but differ with respect to the effect of sales charges, the distribution and/or service fees borne by each class, expenses specific to each class, voting rights on matters affecting a single class and the exchange privileges of each class.

2. Significant Accounting Policies

The following is a summary of significant accounting policies followed by the Fund in the preparation of its financial statements. The policies are in conformity with accounting principles generally accepted in the United States of America for investment companies.

Portfolio valuation: Municipal securities are valued each business day based upon information provided by a nationally prominent independent pricing service and periodically verified through other pricing services. In the case of securities for which market quotations are readily available, securities are valued by the pricing service at the mean of bid and asked quotations. If a market quotation or a valuation from the pricing service is not readily available, the security is valued at fair value determined in good faith under procedures established by and under the general supervision of the Board of Trustees.

Fair value measurements: The Fund follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Fund’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Fund’s investments and are summarized in the following fair value hierarchy:

17 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.

Level 2 – Observable inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.

Level 3 – Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Fund’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, based on the best information available.

The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.

The following is a summary of the valuation inputs, representing 100% of the Fund’s investments, used to value the Fund’s net assets as of September 30, 2016:

Valuation Inputs*	Investments in Securities
Level 1 – Quoted Prices - Short-term Investment	$	2,921,275
Level 2 – Other Significant Observable
Inputs — Municipal Bonds		258,495,071
Level 3 – Significant Unobservable Inputs		—
Total	$	261,416,346

* See schedule of investments for a detailed listing of securities.

c)	Subsequent events: In preparing these financial statements, the Fund has evaluated events and transactions for potential recognition or disclosure through the date these financial statements were issued.

Securities transactions and related investment income: Securities transactions are recorded on the trade date. Realized gains and losses from securities transactions are reported on the identified cost basis. Interest income is recorded daily on the accrual basis and is adjusted for amortization of premium and accretion of original issue and market discount.

Federal income taxes: It is the policy of the Fund to continue to qualify as a regulated investment company by complying with the provisions of the Internal Revenue Code applicable to certain investment companies. The Fund intends to make distributions of income and securities profits sufficient to relieve it from all, or substantially all, Federal income and excise taxes.

Management has reviewed the tax positions for each of the open tax years (2013–2015) or expected to be taken in the Fund’s 2016 tax returns and has concluded that there are no significant uncertain tax positions that would require recognition in the financial statements.

18 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Multiple class allocations: All income, expenses (other than class-specific expenses), and realized and unrealized gains or losses are allocated daily to each class of shares based on the relative net assets of each class. Class-specific expenses, which include distribution and service fees and any other items that are specifically attributed to a particular class, are also charged directly to such class on a daily basis.

Use of estimates: The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.

Reclassification of capital accounts: Accounting principles generally accepted in the United States of America require that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting. On March 31, 2016, the Fund decreased additional paid in capital by $112,779, and decreased accumulated realized loss by $112,779. These reclassifications had no effect on net assets or net asset value per share

i)	The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 “Financial Services-Investment Companies”.

3. Fees and Related Party Transactions

a) Management Arrangements:

Aquila Investment Management LLC (the “Manager”), a wholly-owned subsidiary of Aquila Management Corporation, the Fund’s founder and sponsor, serves as the Manager for the Fund under an Advisory and Administration Agreement with the Fund. Under the Advisory and Administration Agreement, the Manager provides all investment management and administrative services to the Fund. The Manager’s services include providing the office of the Fund and all related services as well as managing relationships with all of the various support organizations to the Fund such as the shareholder servicing agent, custodian, legal counsel, fund accounting agent, auditors and distributor. For its services, the Manager is entitled to receive a fee which is payable monthly and computed as of the close of business each day at the annual rate of 0.40% on the Fund’s average net assets.

19 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Under a Compliance Agreement with the Manager, the Manager is compensated by the Fund for Chief Compliance Officer related services provided to enable the Fund to comply with Rule 38a-1 of the Investment Company Act of 1940.

Specific details as to the nature and extent of the services provided by the Manager are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

b) Distribution and Service Fees:

The Fund has adopted a Distribution Plan (the “Plan”) pursuant to Rule 12b-1 (the “Rule”) under the Investment Company Act of 1940. Under one part of the Plan, with respect to Class A Shares, the Fund is authorized to make distribution fee payments to broker-dealers or others (“Qualified Recipients”) selected by Aquila Distributors LLC (the “Distributor”) including, but not limited to, any principal underwriter of the Fund, with which the Distributor has entered into written agreements contemplated by the Rule and which have rendered assistance in the distribution and/or retention of the Fund’s shares or servicing of shareholder accounts. The Fund makes payment of this distribution fee at the annual rate of 0.15% of the Fund’s average net assets represented by Class A Shares. For the six months ended September 30, 2016, distribution fees on Class A Shares amounted to $147,346 of which the Distributor retained $4,532.

Under another part of the Plan, the Fund is authorized to make payments with respect to Class C Shares to Qualified Recipients which have rendered assistance in the distribution and/or retention of the Fund’s Class C shares or servicing of shareholder accounts. These payments are made at the annual rate of 0.75% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, amounted to $38,958. In addition, under a Shareholder Services Plan, the Fund is authorized to make service fee payments with respect to Class C Shares to Qualified Recipients for providing personal services and/or maintenance of shareholder accounts. These payments are made at the annual rate of 0.25% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, amounted to $12,986. For the six months ended September 30, 2016, the total of these payments with respect to Class C Shares amounted to $51,944 of which the Distributor retained $11,751.

Under another part of the Plan, the Fund is authorized to make payments with respect to Class I Shares to Qualified Recipients. Class I payments, under the Plan, may not exceed for any fiscal year of the Fund a rate (currently 0.10%), set from time to time by the Board of Trustees, of not more than 0.25% of the average annual net assets represented by the Class I Shares. In addition, Class I has a Shareholder Services Plan under which it may pay service fees (currently 0.25%) of not more than 0.25% of the average annual net assets represented by Class I Shares. That is, the total payments under both plans will not exceed 0.50% of such net assets. For the six months ended September 30, 2016, these payments were made at the average annual rate of 0.35% of such net assets and amounted to $15,224 of which $4,350 related to the Plan and $10,874 related to the Shareholder Services Plan.

20 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Specific details about the Plans are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

Under a Distribution Agreement, the Distributor serves as the exclusive distributor of the Fund’s shares. Through agreements between the Distributor and various brokerage and advisory firms (“intermediaries”), the Fund’s shares are sold primarily through the facilities of these intermediaries having offices within Kentucky, with the bulk of any sales commissions inuring to such intermediaries. For the six months ended September 30, 2016, total commissions on sales of Class A Shares amounted to $188,657 of which the Distributor received $16,213.

4. Purchases and Sales of Securities

During the six months ended September 30, 2016, purchases of securities and proceeds from the sales of securities aggregated $45,605,049 and $37,576,893, respectively.

At September 30, 2016, the aggregate tax cost for all securities was $249,258,381. At September 30, 2016, the aggregate gross unrealized appreciation for all securities in which there is an excess of value over tax cost amounted to $12,211,373 and aggregate gross unrealized depreciation for all securities in which there is an excess of tax cost over value amounted to $53,408 for a net unrealized appreciation of $12,157,965.

5. Portfolio Orientation

Since the Fund invests principally and may invest entirely in double tax-free municipal obligations of issuers within Kentucky, it is subject to possible risks associated with economic, political, or legal developments or industrial or regional matters specifically affecting Kentucky and whatever effects these may have upon Kentucky issuers’ ability to meet their obligations.

21 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

6. Capital Share Transactions

Transactions in Capital Shares of the Fund were as follows:

	Six Months Ended
	September 30, 2016						Year Ended
	(unaudited)						March 31, 2016
	Shares			Amount			Shares			Amount
Class A Shares:
Proceeds from shares sold		1,143,383		$	12,487,386			1,625,075		$	17,578,663
Reinvested dividends and
distributions		181,642			1,981,438			371,104			4,016,001
Cost of shares redeemed		(651,822	)		(7,124,034	)		(1,756,446	)		(19,003,005	)
Net change		673,203			7,344,790			239,733			2,591,659
Class C Shares:
Proceeds from shares sold		120,198			1,311,769			261,322			2,825,198
Reinvested dividends and
distributions		7,841			85,497			16,671			180,361
Cost of shares redeemed		(144,255	)		(1,576,041	)		(255,887	)		(2,765,902	)
Net change		(16,216	)		(178,775	)		22,106			239,657
Class I Shares:
Proceeds from shares sold		9,651			105,000			68,656			742,565
Reinvested dividends and
distributions		10,357			113,059			21,748			235,360
Cost of shares redeemed		(25,326	)		(275,677	)		(11,837	)		(128,371	)
Net change		(5,318	)		(57,618	)		78,567			849,554
Class Y Shares:
Proceeds from shares sold		745,033			8,133,243			2,005,739			21,732,924
Reinvested dividends and
distributions		10,901			119,112			21,532			233,232
Cost of shares redeemed		(840,041	)		(9,191,525	)		(698,447	)		(7,568,751	)
Net change		(84,107	)		(939,170	)		1,328,824			14,397,405
Total transactions in Fund
shares		567,562		$	6,169,227			1,669,230		$	18,078,275

22 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

7. Trustees’ Fees and Expenses

For the six months ended September 30, 2016, there were 9 Trustees, one of whom is affiliated with the Manager and is not paid any fees. The total amount of Trustees’ service fees (for carrying out their responsibilities) and attendance fees paid during the six months ended September 30, 2016 was $38,325. Attendance fees are paid to those in attendance at regularly scheduled quarterly Board Meetings and meetings of the independent Trustees held prior to each quarterly Board Meeting, as well as additional meetings (such as Audit, Nominating, Shareholder and special meetings). Trustees are reimbursed for their expenses such as travel, accommodations and meals incurred in connection with attendance at Board Meetings and at the Annual Meeting of Shareholders. For the six months ended September 30, 2016, such meeting-related expenses amounted to $9,141.

8. Securities Traded on a When-Issued Basis

The Fund may purchase or sell securities on a when-issued basis. When-issued transactions arise when securities are purchased or sold by the Fund with payment and delivery taking place in the future in order to secure what is considered to be an advantageous price and yield to the Fund at the time of entering into the transaction. Beginning on the date the Fund enters into a when-issued transaction, cash or other liquid securities are segregated in an amount equal to or greater than the value of the when-issued transaction. These transactions are subject to market fluctuations and their current value is determined in the same manner as for other securities.

9. Income Tax Information and Distributions

The Fund declares dividends daily from net investment income and makes payments monthly. Net realized capital gains, if any, are distributed annually and are taxable. Dividends and capital gains distributions are paid in additional shares at the net asset value per share, in cash, or in a combination of both, at the shareholder’s option.

The Fund intends to maintain, to the maximum extent possible, the tax-exempt status of interest payments received from portfolio municipal securities in order to allow dividends paid to shareholders from net investment income to be exempt from regular Federal and Commonwealth of Kentucky income taxes. Due to differences between financial statement reporting and Federal income tax reporting requirements, distributions made by the Fund may not be the same as the Fund’s net investment income, and/or net realized securities gains. Further, a small portion of the dividends may, under some circumstances, be subject to taxes at ordinary income and/or capital gain rates. For certain shareholders, some dividend income may, under some circumstances, be subject to the alternative minimum tax. As a result of the passage of the Regulated Investment Company Modernization Act of 2010 (the “Act”), losses incurred in this fiscal year and beyond retain their character as short-term or long-term, have no expiration date and are utilized before capital losses incurred prior to the enactment of the Act. At March 31, 2016, the Fund had capital loss carryforwards of $654,083 of which $175,082 expires in 2017 and $479,001 has no expiration and retains its character of short-term.

23 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

The tax character of distributions was as follows:

	Year		Year
	Ended		Ended
	March 31, 2016		March 31, 2015
Net tax-exempt income	$	7,178,304	$	7,125,154
Ordinary Income		28,086		–
	$	7,206,390	$	7,125,154

As of March 31, 2016, the components of distributable earnings on a tax basis were as follows:

Accumulated net realized loss	$	(654,083	)
Unrealized appreciation		12,271,735
Undistributed tax-exempt income		178,062
Other temporary differences		(156,707	)
	$	11,639,007

The difference between book basis and tax basis undistributed income is due to the timing difference, and other temporary differences, in recognizing dividends paid and the tax treatment of market discount amortization.

24 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

FINANCIAL HIGHLIGHTS

For a share outstanding throughout each period

	Class A

	Six Months Ended			Year			Year			Year			Three Months			Year Ended December 31,
	9/30/16 (unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.88		$	10.91		$	10.65		$	10.97		$	11.07		$	10.84		$	10.26
Income from investment operations:
Net investment income(1)		0.16			0.32			0.33			0.34			0.08			0.36			0.39
Net gain (loss) on securities (both
realized and unrealized)		–			(0.03	)		0.26			(0.32	)		(0.10	)		0.23			0.58
Total from investment operations		0.16			0.29			0.59			0.02			(0.02	)		0.59			0.97
Less distributions (note 9):
Dividends from net investment income		(0.16	)		(0.32	)		(0.33	)		(0.34	)		(0.08	)		(0.36	)		(0.39	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.16	)		(0.32	)		(0.33	)		(0.34	)		(0.08	)		(0.36	)		(0.39	)
Net asset value, end of period	$	10.88		$	10.88		$	10.91		$	10.65		$	10.97		$	11.07		$	10.84
Total return (not reflecting sales charge)		1.41	%(2)		2.75	%		5.61	%		0.21	%		(0.14	)%(2)		5.53	%		9.64	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	197		$	189		$	187		$	188		$	215		$	219		$	199
Ratio of expenses to average net assets		0. 73	%(3)		0.73	%		0.78	%		0.80	%(4)		0.77	%(3)		0.76	%		0.77	%
Ratio of net investment income to
average net assets		2.83	%(3)		3.00	%		3.07	%		3.18	%(4)		3.11	%(3)		3.30	%		3.73	%
Portfolio turnover rate		15	%(2)		7	%		14	%		9	%		2	%(2)		12	%		12	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.76% and 3.22%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from December 31 to March 31. The information presented is for the period January 1, 2013 to March 31, 2013.

See accompanying notes to financial statements.

25 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class C
	Six Months Ended			Year			Year			Year			Three Months			Year Ended December 31,
	9/30/16 (unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.87		$	10.90		$	10.64		$	10.96		$	11.07		$	10.83		$	10.25
Income from investment operations:
Net investment income(1)		0.11			0.23			0.24			0.25			0.06			0.27			0.30
Net gain (loss) on securities (both
realized and unrealized)		0.01			(0.03	)		0.26			(0.32	)		(0.11	)		0.24			0.58
Total from investment operations		0.12			0.20			0.50			(0.07	)		(0.05	)		0.51			0.88
Less distributions (note 9):
Dividends from net investment income		(0.11	)		(0.23	)		(0.24	)		(0.25	)		(0.06	)		(0.27	)		(0.30	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.11	)		(0.23	)		(0.24	)		(0.25	)		(0.06	)		(0.27	)		(0.30	)
Net asset value, end of period	$	10.88		$	10.87		$	10.90		$	10.64		$	10.96		$	11.07		$	10.83
Total return (not reflecting CDSC)		1.07	%(2)		1.88	%		4.72	%		(0.64	)%		(0.44	)%(2)		4.73	%		8.72	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	10		$	10		$	10		$	10		$	12		$	13		$	9
Ratio of expenses to average net assets		1.59	%(3)		1.58	%		1.63	%		1.65	%(4)		1.62	%(3)		1.61	%		1.62	%
Ratio of net investment income to
average net assets		1.98	%(3)		2.14	%		2.21	%		2.33	%(4)		2.26	%(3)		2.43	%		2.87	%
Portfolio turnover rate		15	%(2)		7	%		14	%		9	%		2	%(2)		12	%		12	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 1.61% and 2.37%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from December 31 to March 31. The information presented is for the period January 1, 2013 to March 31, 2013.

See accompanying notes to financial statements.

26 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class I
	Six Months Ended			Year			Year			Year			Three Months			Year Ended December 31,
	9/30/16 (unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.87		$	10.90		$	10.64		$	10.97		$	11.07		$	10.83		$	10.25
Income from investment operations:
Net investment income(1)		0.15			0.31			0.32			0.32			0.08			0.34			0.37
Net gain (loss) on securities (both
realized and unrealized)		0.01			(0.03	)		0.26			(0.33	)		(0.10	)		0.24			0.58
Total from investment operations		0.16			0.28			0.58			(0.01	)		(0.02	)		0.58			0.95
Less distributions (note 9):
Dividends from net investment income		(0.15	)		(0.31	)		(0.32	)		(0.32	)		(0.08	)		(0.34	)		(0.37	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.15	)		(0.31	)		(0.32	)		(0.32	)		(0.08	)		(0.34	)		(0.37	)
Net asset value, end of period	$	10.88		$	10.87		$	10.90		$	10.64		$	10.97		$	11.07		$	10. 83
Total return		1.43	%(2)		2.61	%		5.46	%		(0.05	)%		(0.18	)%(2)		5.47	%		9.48	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	9		$	9		$	8		$	7		$	7		$	7		$	7
Ratio of expenses to average net assets		0.87	%(3)		0.87	%		0.92	%		0.96	%(4)		0.94	%(3)		0.91	%		0.92	%
Ratio of net investment income to
average net assets		2.69	%(3)		2.86	%		2.93	%		3.02	%(4)		2.94	%(3)		3.15	%		3.58	%
Portfolio turnover rate		15	%(2)		7	%		14	%		9	%		2	%(2)		12	%		12	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.92% and 3.06%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from December 31 to March 31. The information presented is for the period January 1, 2013 to March 31, 2013.

See accompanying notes to financial statements.

27 | Aquila Churchill Tax-Free Fund of Kentucky

AQUILA CHURCHILL TAX-FREE FUND OF KENTUCKY

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class Y
	Six Months Ended			Year			Year			Year			Three Months			Year Ended December 31,
	9/30/16 (unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.88		$	10.91		$	10.65		$	10.98		$	11.08		$	10.84		$	10.26
Income from investment operations:
Net investment income(1)		0.16			0.34			0.35			0.35			0.09			0.38			0.41
Net gain (loss) on securities (both
realized and unrealized)		0.01			(0.03	)		0.26			(0.33	)		(0.10	)		0.24			0.58
Total from investment operations		0.17			0.31			0.61			0.02			(0.01	)		0.62			0.99
Less distributions (note 9):
Dividends from net investment income		(0.16	)		(0.34	)		(0.35	)		(0.35	)		(0.09	)		(0.38	)		(0.41	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.16	)		(0.34	)		(0.35	)		(0.35	)		(0.09	)		(0.38	)		(0.41	)
Net asset value, end of period	$	10.89		$	10.88		$	10.91		$	10.65		$	10.98		$	11.08		$	10.84
Total return		1. .58	%. (2)		2.92	%		5.77	%		0.27	%		(0.10	)%(2)		5.78	%		9.81	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	46		$	47		$	32		$	29		$	35		$	34		$	33
Ratio of expenses to average net assets		0.58	%(3)		0.58	%		0.63	%		0.65	%(4)		0.62	%(3)		0.61	%		0.62	%
Ratio of net investment income to
average net assets		2.99	(3)%		3.15	%		3.21	%		3.33	%(4)		3.26	%(3)		3.45	%		3.89	%
Portfolio turnover rate		15	%. (2)		7	%		14	%		9	%		2	%(2)		12	%		12	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.61% and 3.37%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from December 31 to March 31. The information presented is for the period January 1, 2013 to March 31, 2013.

See accompanying notes to financial statements.

28 | Aquila Churchill Tax-Free Fund of Kentucky

Analysis of Expenses (unaudited)

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including front-end sales charges with respect to Class A shares or contingent deferred sales charges (“CDSC”) with respect to Class C shares; and (2) ongoing costs, including management fees; distribution (12b-1) and/or service fees; and other Fund expenses. The table below is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The table below is based on an investment of $1,000 invested on April 1, 2016 and held for the six months ended September 30, 2016.

Actual Expenses

This table provides information about actual account values and actual expenses. You may use the information provided in this table, together with the amount you invested, to estimate the expenses that you paid over the period. To estimate the expenses you paid on your account, divide your ending account value by $1,000 (for example, an $8,600 ending account value divided by $1,000 = 8.6), then multiply the result by the number under the heading “Expenses Paid During the Period”.

Six months ended September 30, 2016

	Actual
	Total Return	Beginning	Ending	Expenses
	Without	Account	Account	Paid During
	Sales Charges(1)	Value	Value	the Period(2)
Class A	1.41%	$1,000.00	$1,014.10	$3.69
Class C	1.07%	$1,000.00	$1,010.70	$8.01
Class I	1.43%	$1,000.00	$1,014.30	$4.39
Class Y	1.58%	$1,000.00	$1,015.80	$2.93

(1)

Assumes reinvestment of all dividends and capital gain distributions, if any, at net asset value and does not reflect the deduction of the applicable sales charges with respect to Class A shares or the applicable CDSC with respect to Class C shares. Total return is not annualized; as such, it may not be representative of the total return for the year.

(2)	Expenses are equal to the annualized expense ratio of 0.73%, 1.59%, 0.87% and 0.58% for the Fund’s Class A, C, I and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

29 | Aquila Churchill Tax-Free Fund of Kentucky

Analysis of Expenses (unaudited) (continued)

Hypothetical Example for Comparison Purposes

The table below provides information about hypothetical account values and hypothetical expenses based on the actual expense ratio and an assumed rate of return of 5.00% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use the information provided in this table to compare the ongoing costs of investing in the Fund and other mutual funds. To do so, compare this 5.00% hypothetical example relating to the Fund with the 5.00% hypothetical examples that appear in the shareholder reports of other mutual funds.

Please note that the expenses shown in the table below are meant to highlight your ongoing costs only and do not reflect any transactional costs with respect to Class A shares. The example does not reflect the deduction of CDSC with respect to Class C shares. Therefore, the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different mutual funds. In addition, if these transaction costs were included, your costs would have been higher.

Six months ended September 30, 2016

	Hypothetical
	Annualized	Beginning	Ending	Expenses
	Total	Account	Account	Paid During
	Return	Value	Value	the Period(1)
Class A	5.00%	$1,000.00	$1,021.41	$3.70
Class C	5.00%	$1,000.00	$1,017.10	$8.04
Class I	5.00%	$1,000.00	$1,020.71	$4.41
Class Y	5.00%	$1,000.00	$1,022.16	$2.94

(1)	Expenses are equal to the annualized expense ratio of 0.73%, 1.59%, 0.87% and 0.58% for the Fund’s Class A, C, I and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

30 | Aquila Churchill Tax-Free Fund of Kentucky

Information Available (unaudited)

Much of the information that the funds in the Aquila Group of Funds produce is automatically sent to you and all other shareholders. Specifically, you are routinely sent your Fund’s entire list of portfolio securities twice a year in the semi-annual and annual reports you receive. Additionally, under Fund policies, the Manager publicly discloses the complete schedule of the Fund’s portfolio holdings, as of each calendar quarter, generally by the 15th day after the end of each calendar quarter. Such information remains accessible until the next schedule is made publicly available. You may obtain a copy of the Fund’s portfolio holdings schedule for the most recently completed period by visiting the Fund’s website at www.aquilafunds.com. Whenever you wish to see a listing of your Fund’s portfolio other than in your shareholder reports, please check our website at www.aquilafunds.com or call us at 1-800-437-1020.

The Fund additionally files a complete list of its portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. Forms N-Q are available free of charge on the SEC website at www.sec.gov. You may also review or, for a fee, copy the forms at the SEC’s Public Reference Room in Washington, D.C. or by calling 1-800-SEC-0330.

Proxy Voting Record (unaudited)

During the 12 month period ended June 30, 2016, the Fund did not vote any proxies. Applicable regulations require us to inform you that the Fund’s proxy voting information is available on the SEC website at www.sec.gov.

Federal Tax Status of Distributions (unaudited)

This information is presented in order to comply with a requirement of the Internal Revenue Code. No action on the part of shareholders is required.

For the fiscal year ended March 31, 2016, $7,178,304 of dividends paid by Aquila Churchill Tax-Free Fund of Kentucky, constituting 99.6% of total dividends paid, were exempt-interest dividends; and the balance was ordinary income.

Prior to February 15, 2017, shareholders will be mailed the appropriate tax form(s) which will contain information on the status of distributions paid for the 2016 calendar year.

31 | Aquila Churchill Tax-Free Fund of Kentucky

Additional Information (unaudited)

Renewal of the Advisory and Administration Agreement

Aquila Investment Management LLC (the “Manager”) serves as the investment adviser to the Fund pursuant to an Advisory and Administration Agreement (the “Advisory Agreement”). In order for the Manager to remain the investment adviser of the Fund, the Trustees of the Fund must determine annually whether to renew the Advisory Agreement for the Fund.

In considering whether to approve the renewal of the Advisory Agreement, the Trustees requested and obtained such information as they deemed reasonably necessary. Contract review materials were provided to the Trustees in August, 2016. The independent Trustees met telephonically on August 30, 2016 and in person on September 18, 2016 to review and discuss the contract review materials. The Trustees considered, among other things, information presented by the Manager. They also considered information presented in a report prepared by an independent consultant with respect to the Fund’s fees, expenses and investment performance, which included comparisons of the Fund’s investment performance against peers and the Fund’s benchmark and comparisons of the advisory fee payable under the Advisory Agreement against the advisory fees paid by the Fund’s peers, as well as information regarding the operating margins of certain investment advisory firms (the “Consultant’s Report”). In addition, the Trustees took into account the information related to the Fund provided to the Trustees at each regularly scheduled meeting.

At the meeting held on September 18, 2016, based on their evaluation of the information provided by the Manager and the independent consultant, the Trustees of the Fund, including the independent Trustees voting separately, unanimously approved the renewal of the Advisory Agreement until September 30, 2017. In considering the renewal of the Advisory Agreement, the Trustees considered various factors that they determined were relevant, including the factors described below. The Trustees did not identify any single factor as the controlling factor in determining to approve the renewal of the Advisory Agreement.

The nature, extent, and quality of the services provided by the Manager

The Trustees considered the nature, extent and quality of the services that had been provided by the Manager to the Fund, taking into account the investment objectives and strategies of the Fund. The Trustees reviewed the terms of the Advisory Agreement.

The Trustees reviewed the Manager’s investment approach for the Fund and its research process. The Trustees considered that the Manager had provided all advisory and administrative services to the Fund that the Trustees deemed necessary or appropriate, including the specific services that the Trustees have determined are required for the Fund, given that it seeks to provide shareholders with as high a level of current income exempt from Kentucky state and regular Federal income taxes as is consistent with preservation of capital. The Trustees considered the personnel of the Manager who provide investment management services to the Fund. The Manager has employed Mr. Royden Durham and Mr. Todd Curtis as co-portfolio managers for the Fund and has established facilities and capabilities for credit analysis of the Fund’s portfolio securities. The Trustees noted the extensive experience of the co-portfolio managers. They considered that Mr. Durham is based in Louisville, Kentucky and that he has a comprehensive understanding regarding the economy of the State of Kentucky and the securities in which the Fund invests, including those securities with less than the highest ratings from the rating agencies. The Trustees also noted that the Fund did not own any Puerto Rico municipal bonds during the review period.

32 | Aquila Churchill Tax-Free Fund of Kentucky

The Trustees noted that the Manager has additionally provided all administrative services to the Fund and provided the Fund with personnel (including Fund officers) and other resources that are necessary for the Fund’s business management and operations. The Trustees considered the nature and extent of the Manager’s supervision of third-party service providers, including the Fund’s fund accountant, shareholder servicing agent and custodian.

Based on these considerations, the Trustees concluded that the nature, extent and quality of services that had been provided by the Manager to the Fund were satisfactory and consistent with the terms of the Advisory Agreement.

The investment performance of the Fund

The Trustees reviewed the Fund’s performance (Class A shares) and compared its performance to the performance of:

•

the funds in the Fund’s peer group (the “Peer Group”), as selected by the independent consultant (four Kentucky intermediate and long municipal bond funds, as classified by Morningstar; three of the funds charge a front-end sales charge and one fund is a no-load fund);

•

the funds in the Fund’s product category for performance (the “Product Category for Performance”) (all funds in the Peer Group and, without duplication, all funds (and all classes) included in the Morningstar Single-State Intermediate Municipal Bond Funds category); and

•

the Fund’s benchmark index, the Barclays Capital Quality Intermediate Municipal Bond Index.

The Trustees considered that the materials included in the Consultant’s Report indicated that the Fund’s average annual total return was lower than the average annual total return of the funds in the Peer Group for each of the one, three, five and ten-year periods ended June 30, 2016. The Trustees also considered that, as reflected in the Consultant’s Report, the Fund’s average annual total return was higher than the average annual total return of the funds in the Product Category for Performance for each of the five and ten-year periods ended June 30, 2016, but lower than the average annual total return of the funds in the Product Category for Performance for each of the one and three-year periods ended June 30, 2016. The Trustees further considered that the Fund outperformed its benchmark index for the three and five year-periods but underperformed its benchmark index for the one and ten-year periods, all as of June 30, 2016. The Trustees noted that a no-load fund was included in the Peer Group and considered the impact of the inclusion of such fund in the average annual return of the funds in the Peer Group. The Trustees considered that, as reflected in the Consultant’s Report, the Fund was in the first quintile on a risk-adjusted basis for the three and five year periods ended June 30, 2016 (as evidenced by its Sharpe ratio) when compared to the funds in the Product Category for Performance. The Trustees also noted that, unlike the Fund’s returns, the performance of the benchmark index did not reflect any fees or expenses.

33 | Aquila Churchill Tax-Free Fund of Kentucky

The Trustees discussed the Fund’s performance record with the Manager and considered the Manager’s view that the Fund’s performance, as compared to its peer group, was explained in part by the Fund’s generally higher-quality portfolio and lower duration. The Trustees also considered the surge in refunding of portfolio securities during the period and the Manager’s current goal to seek to slightly lengthen the average maturity of the Fund’s portfolio.

The Trustees considered the Fund’s investment performance to be consistent with the investment objectives of the Fund. Evaluation of the investment performance of the Fund indicated to the Trustees that renewal of the Advisory Agreement would be appropriate.

Advisory Fees and Fund Expenses

The Trustees reviewed the Fund’s advisory fees and expenses and compared them to the advisory fee and expense data for:

•

the funds in the Peer Group (as defined above); and

•

the funds in the product category for expenses (the “Product Category for Expenses”) (Morningstar Single-State Intermediate Municipal Bond Funds and Morningstar Single State Long Municipal Bond Funds from states within which 4-7 mutual funds are operating, with similar operating expense structures).

The Trustees considered that the Fund’s contractual advisory fee was less than the average and median contractual advisory fees of the funds in the Peer Group (at the Fund’s current asset level) and lower than the asset-weighted average contractual advisory fee of the funds in the Product Category for Expenses (at various asset levels). They also noted that the Fund’s management fee and expenses (for Class A shares) were lower than the average actual management fee and expenses, respectively, of the funds in both the Product Category for Expenses and the Peer Group, respectively (after giving effect to fee waivers and expense reimbursements in effect for those funds).

The Trustees reviewed management fees charged by the Manager to its other clients. It was noted that the Manager does not have any other clients except for other funds in the Aquila Group of Funds. The Trustees noted that in most instances the fee rates for those clients were comparable to the fees paid to the Manager with respect to the Fund. In evaluating the fees associated with the other funds, the Trustees took into account the respective demands, resources and complexity associated with the Fund and those funds.

The Trustees concluded that the advisory fee and expenses of the Fund were reasonable in relation to the nature and quality of the services provided by the Manager to the Fund.

34 | Aquila Churchill Tax-Free Fund of Kentucky

Profitability

The Trustees received materials from the Manager and the independent consultant related to profitability. The Manager provided information which showed the profitability to the Manager of its services to the Fund, as well as the profitability of Aquila Distributors LLC of distribution services provided to the Fund. The independent consultant provided publicly available data regarding the profitability of other asset managers in comparison to the overall profitability of the Manager.

The Trustees considered the information provided by the Manager regarding the profitability of the Manager with respect to the advisory services provided by the Manager to the Fund, including the methodology used by the Manager in allocating certain of its costs to the management of the Fund. The Trustees also considered information regarding the profitability of the Manager provided to the Trustees by the independent consultant. The Trustees concluded that profitability to the Manager with respect to the advisory services provided to the Fund did not argue against approval of the fees to be paid under the Advisory Agreement.

The extent to which economies of scale would be realized as the Fund grows

The Trustees considered the extent to which the Manager may realize economies of scale or other efficiencies in managing the Fund. The Trustees considered that the materials indicated that the Fund’s fees are already generally lower than those of its peers, including those funds with breakpoints. The Trustees noted that the Manager’s profitability also may be an indicator of the availability of any economies of scale. Accordingly, the Trustees concluded that economies of scale, if any, were being appropriately shared with the Fund.

Benefits derived or to be derived by the Manager and its affiliate from the relationship with the Fund

The Trustees observed that, as is generally true of most fund complexes, the Manager and its affiliates, by providing services to a number of funds including the Fund, were able to spread costs as they would otherwise be unable to do. The Trustees noted that while that produces efficiencies and increased profitability for the Manager and its affiliates, it also makes their services available to the Fund at favorable levels of quality and cost which are more advantageous to the Fund than would otherwise have been possible.

35 | Aquila Churchill Tax-Free Fund of Kentucky

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Founders

Lacy B. Herrmann (1929-2012)

Aquila Management Corporation, Sponsor

Manager

AQUILA INVESTMENT MANAGEMENT LLC

120 West 45th Street, Suite 3600

New York, New York 10036

Board of Trustees

John C. Lucking, Chair

Diana P. Herrmann, Vice Chair

Ernest Calderón

Thomas A. Christopher

Gary C. Cornia

Grady Gammage, Jr.

Glenn P. O’Flaherty

James R. Ramsey

Laureen L. White

Officers

Diana P. Herrmann, President

Charles E. Childs, III, Executive Vice President and Secretary

Marie E. Aro, Senior Vice President

Paul G. O’Brien, Senior Vice President

Todd W. Curtis, Senior Vice President

and Co-Portfolio Manager

Royden P. Durham, Vice President

and Co-Portfolio Manager

Brandon M. Moody, Vice President

Randall S. Fillmore, Chief Compliance Officer

Joseph P. DiMaggio, Chief Financial Officer and Treasurer

Distributor

AQUILA DISTRIBUTORS LLC

120 West 45th Street, Suite 3600

New York, New York 10036

Transfer and Shareholder Servicing Agent

BNY MELLON INVESTMENT SERVICING (US) INC.

4400 Computer Drive

Westborough, Massachusetts 01581

Custodian

THE BANK OF NEW YORK MELLON

225 Liberty Street

New York, New York 10286

Further information is contained in the Prospectus,

which must precede or accompany this report.

Semi-Annual

Report

September 30, 2016

Please Save the Date for Your 2017 Shareholder Meeting

Wednesday, April 26, 2017

Providence, Rhode Island Convention Center

Details will be available on our website as the date approaches:

www.aquilafunds.com

or through your financial professional

Aquila Narragansett

Tax-Free Income Fund

“The Role of Trustees”

Serving Rhode Island investors since 1992

November, 2016

Dear Fellow Shareholder:

Under applicable state law, Trustees are charged, as their primary responsibility, with safeguarding the interests of shareholders. As such, your Trustees seek to act in your best interests, putting your interests ahead of their own interests and those of anyone else, in overseeing the policies and procedures of Aquila Narragansett Tax-Free Income Fund (your “Fund”), as well as the services provided by your Fund’s key service providers.

The 1940 Act requires your Board of Trustees to review certain of your Fund’s contracts on at least an annual basis, at which time, the majority of your Trustees, including a majority of the independent Trustees, must be present in person. Moreover, in their review of the contracts with your Fund’s adviser and sub-adviser, the Trustees seek to consider certain factors and their conclusions are disclosed to you in your Fund’s next annual or semi-annual report (as is the case with this semi-annual report). Your Trustees’ other key responsibilities include oversight of your Fund’s compliance policies and procedures, valuation and risk management.

Selection and nomination of independent Trustees is by the existing independent Trustees. As detailed in the Nominating Committee Charter which is available on your Fund’s website (www.aquilafunds.com), your Board of Trustees seeks to develop and maintain a board of high quality, independence and integrity to best serve your interests. The Trustees associated with the Aquila Group of Funds are additionally selected on the basis of being accomplished individuals of diverse backgrounds from various parts of the United States, including Rhode Island. Through this diversity, we strive to provide your Fund with a broad breadth and balance of knowledge and experience. Biographical and other information on your Board of Trustees is available on our website and, by law, is included in your Fund’s annual report and Statement of Additional Information.

NOT A PART OF THE SEMI-ANNUAL REPORT

Although, not required, Trustees in the Aquila Group of Funds self-impose some additional criteria.

•

In addition to overseeing your Fund, all Trustees are also fellow shareholders. While Trustees, like any investor, must consider, among other things, their own personal investment objectives (including tax benefits afforded the investment by their state of residence) when deciding upon the size of their investment in Aquila Narragansett Tax-Free Income Fund, we believe it is important that each Trustee has “some skin the game.”

•

Consideration is given to including local residents as Trustees. In this way, the Fund can benefit from their hands-on insight and knowledge of their State.

In short, your Board of Trustees are your “watchdogs,” looking over operations of Aquila Narragansett Tax-Free Income Fund.

It has been our experience that those who have undertaken to serve as Trustees diligently devote their energies, talents and experience to furthering the interests of you, our shareholders.

Sincerely,

Diana P. Herrmann, Vice Chair and President

NOT A PART OF THE SEMI-ANNUAL REPORT

Mutual fund investing involves risk and loss of principal is possible.

Investments in the Fund are subject to possible loss due to the financial failure of the issuers of underlying securities and their inability to meet their debt obligations.

A portion of income may be subject to local, state, Federal and/or alternative minimum tax. Capital gains, if any, are subject to capital gains tax.

These risks may result in share price volatility.

Past performance is no guarantee of future results, and there is no guarantee that any market forecasts discussed will be realized.

NOT A PART OF THE SEMI-ANNUAL REPORT

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (27.9%)	Rating Moody’s, S&P and Fitch	Value

		Barrington, Rhode Island
$	1,120,000	2.500%, 08/01/25	Aa1/NR/NR	$	1,183,493
		Bristol, Rhode Island
	2,200,000	4.000%, 02/15/26 AGC Insured	Aa2/AA+/NR		2,340,822
	2,000,000	4.375%, 02/15/29 AGC Insured	Aa2/AA+/NR		2,143,480
		Coventry, Rhode Island
	500,000	3.375%, 11/01/21 AGMC Insured	A1/NR/NR		542,050
	1,605,000	3.625%, 03/15/27 MAC Insured	A1/AA/NR		1,771,246
		Cranston, Rhode Island
	1,325,000	4.000%, 07/01/28	A1/AA-/AA+		1,527,990
	750,000	4.300%, 07/01/30 AGMC Insured
		Series 2010 A	A1/AA/AA+		819,765
	1,515,000	4.250%, 07/15/24 BAMI Insured
		Series B	A1/AA/AA+		1,761,733
	1,570,000	4.250%, 07/15/25 BAMI Insured
		Series B	A1/AA/AA+		1,840,637
		Cumberland, Rhode Island
	1,000,000	4.250%, 08/01/17 AGMC Insured	Aa3/AA/NR		1,027,120
	600,000	4.250%, 08/01/18 AGMC Insured	Aa3/AA/NR		635,454
	500,000	4.250%, 11/01/27 Series 2011 A	NR/AA/NR		569,010
	500,000	4.625%, 11/01/31 Series 2011 A	NR/AA/NR		573,925
		East Providence, Rhode Island Refunding
	2,500,000	4.550%, 05/15/30 AGMC Insured	A2/AA/NR		2,746,650
		Hopkinton, Rhode Island
	500,000	4.375%, 08/15/31	Aa3/NR/NR		559,660
		Johnston, Rhode Island
	1,020,000	3.450%, 06/01/29 Series A	A3/AA-/NR		1,084,199
	1,020,000	3.700%, 06/01/33 Series A	A3/AA-/NR		1,084,291
		Lincoln, Rhode Island
	2,245,000	3.500%, 08/01/24 Series A	Aa2/NR/AA		2,539,768
	2,225,000	3.500%, 08/01/25 Series A	Aa2/NR/AA		2,530,292
		Narragansett, Rhode Island
	1,025,000	3.500%, 07/15/28	Aa2/AA+/NR		1,153,299
		North Kingstown, Rhode Island
	1,040,000	3.000%, 04/15/24 Series A	Aa2/AA+/NR		1,123,876
		North Smithfield, Rhode Island
	825,000	3.000%, 06/15/26 Series A	Aa2/NR/NR		912,698
		Pawtucket, Rhode Island
	1,950,000	4.500%, 07/15/26 AGC Insured	A3/NR/NR		2,108,535

1 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Pawtucket, Rhode Island (continued)
$	1,500,000	4.750%, 07/15/29 AGC Insured	A3/NR/NR	$	1,627,410
	1,010,000	4.000%, 11/01/25 AGMC Insured	A2/AA/NR		1,130,978
		Providence, Rhode Island
	1,500,000	5.000%, 01/15/23 Series 2010 A
		AGMC Insured Refunding	A2/AA/NR		1,664,055
	1,500,000	5.000%, 01/15/26 Series 2010 A
		AGMC Insured Refunding	A2/AA/NR		1,653,750
	975,000	3.625%, 01/15/29 Series A
		AGMC Insured	A2/AA/BBB-		1,014,136
	2,510,000	3.750%, 01/15/30 Series A
		AGMC Insured	A2/AA/BBB-		2,619,838
	1,000,000	3.750%, 01/15/32 Series A
		AGMC Insured	A2/AA/BBB-		1,036,790
	500,000	4.000%, 07/15/19 Series A Refunding	Baa1/BBB/NR		536,420
		Rhode Island State & Providence
		Plantations Consolidated Capital
		Development Loan
	2,000,000	3.750%, 11/01/23 Series A	Aa2/AA/AA		2,306,660
	2,110,000	4.250%, 10/15/25 Series A	Aa2/AA/AA		2,487,943
	2,000,000	3.000%, 05/01/31 Series A	Aa2/AA/AA		2,035,040
	2,000,000	3.000%, 05/01/32 Series A	Aa2/AA/AA		2,016,580
	1,150,000	4.000%, 10/15/24 Series B	Aa2/AA/AA		1,322,971
	1,750,000	3.250%, 10/15/31 Series B	Aa2/AA/AA		1,807,137
	1,500,000	5.000%, 11/01/34 Series B	Aa2/AA/AA		1,780,995
	2,000,000	5.000%, 08/01/23 Series D	Aa2/AA/AA		2,456,640
	2,000,000	5.000%, 08/01/24 Series D	Aa2/AA/AA		2,501,400
		Richmond, Rhode Island
	1,020,000	3.000%, 08/01/24 .	Aa3/NR/NR		1,113,738
		Warwick, Rhode Island
	1,015,000	4.000%, 08/01/17 AGMC Insured
		Series 2008	A1/AA/NR		1,039,604
	2,000,000	4.000%, 08/01/22 AGMC Insured
		Series 2015 B	NR/AA/NR		2,275,340
		West Greenwich, Rhode Island
	1,175,000	3.000%, 08/15/26	NR/AA+/NR		1,305,249
		West Warwick, Rhode Island
	1,900,000	4.625%, 04/01/26 AGC Insured	A3/NR/NR		2,055,192
	1,000,000	4.750%, 04/01/29 AGC Insured	A3/NR/NR		1,076,300

2 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		West Warwick, Rhode Island (continued)
$	795,000	5.000%, 10/01/32 BAMI Series A	Baa2/AA/NR	$	943,562
		Total General Obligation Bonds			72,387,721

		Revenue Bonds (61.3%)

		Development (5.3%)
		Providence, Rhode Island Redevelopment
		Agency Refunding Public Safety
		Building Project
	1,680,000	5.000%, 04/01/26 AGMC Insured
		Series A	A2/AA/NR		2,023,678
		Rhode Island Certificates of Participation
		(Central Power Plant)
	1,000,000	4.000%, 10/01/20 Series D
		AGMC Insured	Aa3/AA/AA-		1,029,950
		Rhode Island Convention Center
		Authority Refunding
	8,000,000	4.000%, 05/15/23 Series A	A1/AA/AA-		9,156,640
	1,500,000	5.500%, 05/15/27 AGC Insured
		Series A	A1/AA-/AA-		1,669,410
		Total Development			13,879,678

		Higher Education (9.5%)
		Rhode Island Health and Education
		Building Corp., Bryant University
	1,115,000	4.500%, 12/01/27 Series 2011	A2/A/NR		1,272,605
	1,455,000	4.750%, 12/01/29 Series 2011	A2/A/NR		1,658,467
	1,000,000	5.000%, 12/01/30 Series 2011	A2/A/NR		1,155,790
	1,425,000	5.000%, 12/01/31 Series 2011	A2/A/NR		1,644,721
		Rhode Island Health and Education
		Building Corp., Higher Educational
		Facilities
	2,500,000	5.000%, 09/15/30 AGMC Insured	Aa3/NR/NR		2,812,425
		Rhode Island Health and Education
		Building Corp., Johnson & Wales
		University
	785,000	5.500%, 04/01/17 Series 1999 A
		NPFG Insured	NR/AA-/NR		801,634

3 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Higher Education (continued)
		Rhode Island Health and Educational
		Building Corp., Higher Education
		Facility, New England Institute of
		Technology
$	1,250,000	4.750%, 03/01/30 Series 2010 A	NR/A-/A+	$	1,372,562
		Rhode Island Health and Educational
		Building Corp., Higher Education
		Facility, Providence College
	2,490,000	4.000%, 11/01/24 Series 2015	A2/A/NR		2,855,507
		Rhode Island Health and Educational
		Building Corp., Higher Education
		Facility, Rhode Island School of Design
	3,000,000	3.500%, 06/01/29 Series 2012	A1/NR/A+		3,129,840
	2,000,000	4.000%, 06/01/31 Series 2012	A1/NR/A+		2,146,320
	1,000,000	3.500%, 08/15/30 AGMC Insured
		Series B	A1/AA/NR		1,044,180
		Rhode Island Health and Educational
		Building Corp., Higher Education
		Facility, University of Rhode Island
		Auxiliary Enterprise
	2,000,000	5.000%, 09/15/30 Series 2010 B
		AGMC Insured	A1/AA/NR		2,261,360
	500,000	4.000%, 09/15/31
		Series 2016 B †††	A1/A+/NR		551,595
		Rhode Island Health and Educational
		Building Corp., University of
		Rhode Island
	1,000,000	4.500%, 09/15/26 Series 2005
		G Refunding AMBAC Insured	Aa3/A+/NR		1,002,840
		Rhode Island Health and Education
		Facilities Authority, Providence College
	1,000,000	4.000%, 11/01/31	A2/A/NR		1,082,930
		Total Higher Education			24,792,776

		Hospital (1.7%)
		Rhode Island Health & Education
		Building Corp., Hospital Financing
		(Care New England)
	500,000	5.000%, 09/01/23 Series 2016 B	NR/BB/BBB-		559,295

4 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Hospital (continued)
		Rhode Island Health & Education
		Building Corp., Hospital Financing,
		Lifespan Obligated Group
$	1,000,000	5.000%, 05/15/31 Series 2016	NR/BBB+/BBB+	$	1,200,090
	1,250,000	5.000%, 05/15/34 Series 2016	NR/BBB+/BBB+		1,483,763
	1,000,000	5.000%, 05/15/33 Series 2016	NR/BBB+/BBB+		1,191,660
		Total Hospital			4,434,808


		Housing (8.4%)
		Rhode Island Housing & Mortgage
		Finance Corp. Home Funding
	2,485,000	4.000%, 10/01/25 Series 2010 #3	Aa2/NR/NR		2,637,852
	115,000	4.100%, 04/01/28 Series 2010 #3	Aa2/NR/NR		115,000
	1,500,000	4.050%, 10/01/26 2011 Series 4	Aa2/NR/NR		1,600,110
	1,250,000	3.050%, 10/01/28 Series 5	Aa2/NR/NR		1,284,087
	985,000	3.350%, 10/01/33 Series 5	Aa2/NR/NR		1,015,683
	2,185,000	3.450%, 04/01/35 Series 5	Aa2/NR/NR		2,257,345
		Rhode Island Housing & Mortgage
		Finance Corp. Home Ownership
		Opportunity
	3,500,000	3.350%, 10/01/41 Series 68-C†††	Aa2/AA+/NR		3,482,360
		Rhode Island Housing & Mortgage
		Finance Corp. Multi-Family Housing
	2,500,000	4.625%, 10/01/25 Series 2010 A	Aaa/NR/NR		2,719,650
	2,000,000	5.000%, 10/01/30 Series 2010 A	Aaa/NR/NR		2,169,200
	985,000	3.150%, 10/01/31 Series 2016 1B	Aa2/NR/NR		1,010,137
	1,405,000	3.450%, 10/01/36 Series 2016 1B	Aa2/NR/NR		1,443,033
	1,000,000	3.250%, 10/01/27 Series 1B	Aa2/NR/NR		1,046,870
	1,000,000	3.400%, 10/01/29 Series 3B	Aa2/NR/NR		1,033,020
		Total Housing			21,814,347

		Public School (19.8%)
		Rhode Island Certificates of Participation
		(School for the Deaf Project)
	1,000,000	5.500%, 04/01/27 Series C 2009
		AGC Insured	Aa3/AA/AA-		1,106,430
	500,000	5.625%, 04/01/29 Series C 2009
		AGC Insured	Aa3/AA/AA-		554,485

5 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Public School (continued)
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program
$	10,000	5.000%, 05/15/20 AGM Insured
		unrefunded balance	Aa3/NR/NR	$	10,261
	55,000	5.000%, 05/15/24 unrefunded balance	A1/NR/NR		58,397
	1,000,000	4.250%, 05/15/21 Series 2007 B
		AGMC Insured	A2/AA/NR		1,021,230
	500,000	5.000%, 05/15/17 Series 2008 A
		AGMC Insured	Aa3/NR/NR		512,430
	795,000	5.000%, 05/15/27 Series 2015 C	Aa2/NR/NR		981,372
	1,630,000	5.000%, 05/15/27 Series 2015 D	A1/NR/NR		1,989,073
		Rhode Island Health and Education
		Building Corp., Public School Financing
		Program, Chariho Regional School
		District
	1,000,000	5.000%, 05/15/26 Series 2011 B	Aa3/NR/NR		1,156,810
		Rhode Island Health and Education
		Building Corp., Public School Financing
		Program, Town of Coventry
	1,000,000	3.750%, 05/15/28 Series 2013 B
		AGMC Insured	A1/AA/NR		1,063,960
	1,000,000	4.000%, 05/15/33 AGMC Insured	A1/AA/NR		1,067,240
		Rhode Island Health and Educational
		Building Corp., Public School
		Financing Program, City of Cranston
	1,170,000	4.000%, 05/15/30 BAMI Series 2015 B	NR/AA/NR		1,302,304
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, East Greenwich
	1,150,000	3.125%, 05/15/28	Aa1/AA+/NR		1,202,751
	1,000,000	3.250%, 05/15/29	Aa1/AA+/NR		1,049,190
	1,000,000	3.375%, 05/15/30	Aa1/AA+/NR		1,051,960
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, City of
		East Providence
	1,000,000	3.625%, 05/15/32 Series B	Aa3/NR/NR		1,042,540

6 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Public School (continued)
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, Town of
		Little Compton
$	1,620,000	4.000%, 05/15/25 Series 2013 H	NR/AAA/NR	$	1,885,064
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, City of Newport
	1,000,000	4.000%, 05/15/27 Series 2013 C	NR/AA+/NR		1,119,170
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, Town of
		North Kingstown
	1,500,000	3.750%, 05/15/28 Series 2013 A	Aa2/AA+/NR		1,620,420
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, Town of
		North Providence
	1,000,000	4.000%, 11/15/20 Series 2013 I	A1/A/NR		1,098,880
	1,100,000	4.500%, 11/15/22 Series 2013 I	A1/A/NR		1,280,125
		Rhode Island Health and Education
		Building Corp., Public School Financing
		Program, City of Pawtucket
	1,570,000	4.000%, 05/15/26 Series 2014 C	A1/NR/NR		1,775,246
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, Pooled Issue
	3,000,000	4.000%, 05/15/28 Series A	Aa3/NR/NR		3,429,120
	1,270,000	3.250%, 05/15/29 Series A	Aa3/NR/NR		1,355,395
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, Providence Public
		Buildings Authority
	3,000,000	3.500%, 05/15/24 AGMC Insured
		Series 2015 A	A1/AA/NR		3,289,530
	3,000,000	3.750%, 05/15/27 AGMC Insured
		Series 2015 A	A1/AA/NR		3,308,400

7 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Public School (continued)
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program, Providence Public
		Buildings Authority (continued)
$	3,000,000	4.000%, 05/15/28 AGMC Insured
		Series 2015 A	A1/AA/NR	$	3,354,030
	2,760,000	4.000%, 05/15/30 AGMC Insured
		Series 2015 B	A1/AA/NR		3,049,607
		Rhode Island Health and Education
		Building Corp., Public School Financing
		Program, Providence Public Schools
	2,000,000	4.500%, 05/15/22 Series 2013 A	A1/NR/NR		2,290,380
	2,000,000	4.500%, 05/15/23 Series 2013 A	A1/NR/NR		2,327,000
	2,000,000	4.500%, 05/15/24 Series 2013 A	A1/NR/NR		2,309,500
		Rhode Island Health and Education
		Building Corp., Public School Financing
		Program, City of Warwick
	800,000	3.500%, 05/15/26 Series B MAC Insured.	NR/AA/NR		888,496
		Rhode Island Health and Education
		Building Corp., Public School Financing
		Program, Town of West Warwick
	935,000	4.000%, 05/15/21	A1/NR/NR		1,023,881
	745,000	3.000%, 11/15/21	A1/NR/NR		783,241
		Total Public School			51,357,918

		Transportation (5.2%)
		Rhode Island Commerce Corp., Airport
	635,000	5.000%, 07/01/36 Series D	Baa1/BBB+/BBB+		747,408
	1,015,000	5.000%, 07/01/37 Series D	Baa1/BBB+/BBB+		1,189,742
		Rhode Island State Commerce Corp.,
		Grant Anticipation (Rhode Island
		Department of Transportation)
	1,850,000	4.000%, 06/15/24	A2/AA-/NR		2,142,633
		Rhode Island State Economic
		Development Corp., Airport
	1,000,000	5.000%, 07/01/24 Series B	Baa1/BBB+/BBB+		1,173,080
	2,000,000	4.000%, 07/01/24 Series B	Baa1/BBB+/BBB+		2,218,980
	540,000	4.625%, 07/01/26 AGC
		Insured Series B	A3/AA/BBB+		569,705

8 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Transportation (continued)
		Rhode Island State Economic
		Development Corp., Airport (continued)
$	1,000,000	5.000%, 07/01/18 AGC Insured
		Series C	A3/AA/BBB+	$	1,052,400
		Rhode Island State Economic
		Development Corp., Motor Fuel Tax
		(Rhode Island Department of
		Transportation)
	2,385,000	4.700%, 06/15/23 Series 2003 A
		AMBAC Insured	A3/A+/A		2,392,489
	1,000,000	4.000%, 06/15/18 Series 2006 A
		AMBAC Insured	A3/A+/A		1,002,200
		Rhode Island State Economic
		Development Corp.,
		(Rhode Island Airport Corp. Intermodal
		Facility Project)
	1,000,000	4.250%, 07/01/17 CIFG Assurance
		North America, Inc. Insured	A3/AA/NR		1,002,390
		Total Transportation			13,491,027


		Turnpike/Highway (3.8%)
		Rhode Island State Turnpike & Bridge
		Authority
	500,000	4.125%, 12/01/23 Series 2010 A	NR/A-/A		548,650
	1,600,000	4.625%, 12/01/27 Series 2010 A	NR/A-/A		1,789,024
	2,000,000	5.125%, 12/01/35 Series 2010 A	NR/A-/A		2,263,360
	1,000,000	5.000%, 12/01/35 Series 2010 A	NR/A-/A		1,126,690
		Rhode Island State Turnpike & Bridge
		Authority, Motor Fuel Tax
	1,240,000	4.000%, 10/01/27 Series 2016 A	NR/A+/A		1,426,769
	1,500,000	4.000%, 10/01/34 Series 2016 A	NR/A+/A		1,660,950
	1,000,000	4.000%, 10/01/36 Series 2016 A	NR/A+/A		1,099,390
		Total Turnpike/Highway			9,914,833


		Water and Sewer (7.6%)
		Narragansett, Rhode Island Bay
		Commission Wastewater System
	3,145,000	4.000%, 02/01/28 Series A	NR/AA-/NR		3,568,160

9 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Water and Sewer (continued)
		Rhode Island Clean Water Protection
		Finance Agency
$	1,545,000	4.750%, 10/01/18 Series A AMBAC
		Insured	Aaa/NR/NR	$	1,549,975
	500,000	4.750%, 10/01/20 1999 Series A
		AMBAC Insured	Aaa/NR/NR		501,590
		Rhode Island Clean Water Finance
		Agency, Water Pollution Control Bonds
	310,000	5.000%, 10/01/18 Series B NPFG
		Insured	Aaa/AAA/NR		311,063
	4,765,000	4.375%, 10/01/21 Series 2002 B NPFG
		Insured	Aaa/AAA/AAA		4,778,866
		Rhode Island Clean Water Protection
		Finance Agency Safe Drinking Water
		Revolving Fund
	1,085,000	3.500%, 10/01/25	NR/AAA/AAA		1,219,095
	1,000,000	3.750%, 10/01/33	NR/AAA/AAA		1,076,370
	1,000,000	3.750%, 10/01/34	NR/AAA/AAA		1,073,060
		Rhode Island Infrastructure Bank Water,
		City of Pawtucket
	1,730,000	5.000%, 10/01/28 NPFG Insured
		Series 2015	A3/AA-/NR		2,087,072
		Rhode Island Infrastructure Bank Water,
		Pollution Control
	2,575,000	4.000%, 10/01/29 Series A	NR/AAA/AAA		2,948,890
		Rhode Island Infrastructure Bank Water,
		Safe Drinking Water
	500,000	3.000%, 10/01/31 Series A	NR/AAA/AAA		532,040
		Total Water and Sewer			19,646,181
		Total Revenue Bonds			159,331,568

		Pre-Refunded\
		Escrowed to Maturity Bonds (9.2%)††

		Pre-Refunded
		General Obligation Bonds (1.4%)
		Cranston, Rhode Island
	2,455,000	4.625%, 07/01/25 AGMC Insured	A1/AA/NR		2,613,274

10 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded \Escrowed to Maturity Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Pre-Refunded
		General Obligation Bonds (continued)
		Cranston, Rhode Island (continued)
$	990,000	4.750%, 07/01/28 AGMC Insured	A1/AA/NR	$	1,055,954
		Total Pre-Refunded General Obligation Bonds			3,669,228


		Pre-Refunded Escrowed to Maturity
		Revenue Bonds (7.8%)
		Hospital (0.5%)
		Rhode Island Health & Education
		Building Corp., Hospital Financing
		(Care New England)
	500,000	5.000%, 09/01/20 Series 2013 A	NR/BB/BBB-		574,960
	500,000	5.000%, 09/01/22 Series 2013 A	NR/BB/BBB-		606,730
		Total Hospital			1,181,690

		Public School (6.1%)
		Providence, Rhode Island Public Building
		Authority, School Projects
	3,000,000	4.500%, 05/15/27 Series 2007 B
		AGMC Insured	A2/AA/NR		3,066,390
	2,000,000	4.500%, 05/15/28 Series 2007 C
		AGMC Insured	A2/AA/NR		2,044,260
		Rhode Island Health and Education
		Building Corp., Public School
		Financing Program
	1,070,000	5.000%, 05/15/24	.NR/NR/NR		1,139,646
	465,000	5.000%, 05/15/20 Series A
		AGMC Insured	Aa3/NR/NR		476,848
	1,500,000	4.250%, 05/15/21 Series A
		AGMC Insured	Aa3/NR/NR		1,580,925
	2,000,000	4.375%, 05/15/22 Series A
		AGMC Insured	Aa3/NR/NR		2,111,900
	3,000,000	4.500%, 05/15/25 Series A
		AGMC Insured	Aa3/NR/NR		3,173,820
	2,000,000	4.750%, 05/15/29 Series A
		AGMC Insured	Aa3/NR/NR		2,123,860
	25,000	5.000%, 05/15/20 Series 2007 A
		AGMC Insured	Aa3/NR/NR		25,637
		Total Public School			15,743,286

11 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Pre-Refunded \Escrowed to Maturity Bonds (continued)	and Fitch	Value

		Pre-Refunded Escrowed to Maturity
		Revenue Bonds (continued)

		Transportation (0.6%)
		Rhode Island Economic Development
		Corp. (Rhode Island Department of
		Transportation)
$	1,500,000	5.250%, 06/15/21 AGC Insured	A2/AA/NR	$	1,672,020

		Water and Sewer (0.4%)
		Narragansett, Rhode Island Bay
		Commission Wastewater System
	1,000,000	5.000%, 02/01/32 Series 2007 A
		NPFG Insured	NR/AA-/NR		1,013,480


		Other Revenue (0.2%)
		State of Rhode Island Depositors
		Economic Protection Corp.
	250,000	5.750%, 08/01/21 Series A AGMC
		Insured ETM	NR/NR/NR*		301,963
	215,000	6.375%, 08/01/22 Series A NPFG
		Insured ETM	NR/AA-/NR		274,878
		Total Other Revenue			576,841
		Total Pre-Refunded\ Escrowed to Maturity
		Revenue Bonds			20,187,317
		Total Pre-Refunded\
		Escrowed to Maturity Bonds			23,856,545
		Total Municipal Bonds
		(cost $242,233,087)			255,575,834

		Shares Short-Term Investment (2.0%)

	5,157,549	Dreyfus Tax Exempt Cash Management,
		Institutional Shares, 0.55%**
		(cost $5,157,549)	NR/Aaam/NR		5,157,549
		Total Investments
		(cost $247,390,636-note 4)	100.4%		260,733,383
		Other assets less liabilities	(0.4)		(970,783	)
		Net Assets	100.0%	$	259,762,600

12 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

	Percent of
Portfolio Distribution by Quality Rating	Investments†
Aaa of Moody’s or AAA of S&P or Fitch		8.1	%
Pre-refunded bonds\ ETM bonds††		9.3
Aa of Moody’s or AA of S&P or Fitch		58.0
A of Moody’s or S&P or Fitch		20.6
Baa of Moody’s or BBB of S&P or Fitch		4.0
		100.0	%

		PORTFOLIO ABBREVIATIONS:
		AGC - Assured Guaranty Corp.
		AGMC - Assured Guaranty Municipal Corp.
		AMBAC - American Municipal Bond Assurance Corp.
		BAMI - Build America Mutual Insurance
		CIFG - CDC IXIS Financial Guaranty
		ETM - Escrowed to Maturity
		MAC - Municipal Assurance Corp.
		NPFG - National Public Finance Guarantee
		NR - Not Rated

*		Any security not rated (“NR”) by any of the Nationally Recognized Statistical Rating Organizations (“NRSRO”) has been determined by the Investment Sub-Adviser to have sufficient quality to be ranked in the top four credit ratings if a credit rating were to be assigned by a NRSRO.

**		The rate is an annualized seven-day yield at period end.

†		Where applicable, calculated using the highest rating of the three NRSRO. Percentages in this table do not include the Short-Term Investment.

††		Pre-refunded bonds are bonds secured by an escrow account, comprised of U.S. Government Obligations (unless otherwise noted), to retire the bonds at their earliest call date. Escrowed to Maturity bonds are bonds where money has been placed in the escrow account which is used to pay principal and interest through the bond’s originally scheduled maturity date. Escrowed to Maturity are shown as ETM. All other securities in the category are pre-refunded.

†††		Security purchased on a delayed delivery or when-issued basis.

See accompanying notes to financial statements.

13 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

STATEMENT OF ASSETS AND LIABILITIES

SEPTEMBER 30, 2016 (unaudited)

ASSETS
Investments at value (cost $247,390,636)	$	260,733,383
Interest receivable		3,298,369
Receivable for Fund shares sold		322,753
Other assets		18,725
Total assets		264,373,230
LIABILITIES
Payable for investment securities purchased		4,052,500
Dividends payable		243,785
Payable for Fund shares redeemed		134,719
Management fees payable		95,284
Distribution and service fees payable		2090
Accrued expenses payable		82,252
Total liabilities		4,610,630
NET ASSETS	$	259,762,600
Net Assets consist of:
Capital Stock - Authorized an unlimited number of shares, par value
$0.01 per share	$	236,317
Additional paid-in capital		247,320,126
Net unrealized appreciation on investments (note 4)		13,342,747
Accumulated net realized loss on investments		(1,195,414	)
Undistributed net investment income		58,824
	$	259,762,600
CLASS A
Net Assets	$	136,014,030
Capital shares outstanding		12,374,021
Net asset value and redemption price per share	$	10.99
Maximum offering price per share (100/96 of $10.99)	$	11.45
CLASS C
Net Assets	$	14,101,255
Capital shares outstanding		1,283,106
Net asset value and offering price per share	$	10.99

Redemption price per share (*a charge of 1% is imposed on the
redemption proceeds, or on the original price, whichever is
lower, if redeemed during the first 12 months after purchase)	$	10.99	*
CLASS I
Net Assets	$	196,106
Capital shares outstanding		17,849
Net asset value, offering and redemption price per share	$	10.99
CLASS Y
Net Assets	$	109,451,209
Capital shares outstanding		9,956,699
Net asset value, offering and redemption price per share	$	10.99

See accompanying notes to financial statements.

14 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

STATEMENT OF OPERATIONS

SIX MONTHS ENDED SEPTEMBER 30, 2016 (unaudited)

Investment Income:

Interest income				$	4,302,704


Expenses:

Management fees (note 3)	$	649,199
Distribution and service fees (note 3)		176,345
Transfer and shareholder servicing
agent fees (note 3)		78,106
Trustees’ fees and expenses (note 7)		46,856
Legal fees		37,756
Fund accounting fees		19,972
Registration fees and dues		13,222
Shareholders’ reports		11,910
Auditing and tax fees		10,687
Insurance		5,576
Chief compliance officer services (note 3)		4,492
Custodian fees		4,091
Miscellaneous		23,550
Total expenses		1,081,762

Management fees waived (note 3)		(103,872	)
Net expenses					977,890
Net investment income 3,324,814

Realized and Unrealized Gain (Loss) on Investments:

Net realized gain (loss) from securities
transactions		115,116
Change in unrealized appreciation on
investments		1,440,843
Net realized and unrealized gain (loss) on
investments					1,555,959
Net change in net assets resulting from
				$	4,880,773

See accompanying notes to financial statements.

15 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

STATEMENTS OF CHANGES IN NET ASSETS

	Six Months Ended
	September 30, 2016			Year Ended
	(unaudited)			March 31, 2016

OPERATIONS:
Net investment income	$	3,324,814		$	6,586,523
Net realized gain (loss) from
securities transactions		115,116			705,921
Change in unrealized appreciation
on investments		1,440,843			1,916,904
Change in net assets from
operations		4,880,773			9,209,348

DISTRIBUTIONS TO SHAREHOLDERS (note 9):
Class A Shares:
Net investment income		(1,745,090	)		(3,513,312	)

Class C Shares:
Net investment income		(124,495	)		(288,359	)

Class I Shares:
Net investment income		(2,554	)		(6,095	)

Class Y Shares:
Net investment income		(1,448,819	)		(2,772,540	)
Change in net assets from
distributions		(3,320,958	)		(6,580,306	)

CAPITAL SHARE TRANSACTIONS (note 6):
Proceeds from shares sold		23,783,250			34,649,255
Reinvested dividends and
distributions		1,566,731			3,058,596
Cost of shares redeemed		(15,670,396	)		(26,365,615	)
Change in net assets from
capital share transactions		9,679,585			11,342,236

Change in net assets		11,239,400			13,971,278

NET ASSETS:
Beginning of period		248,523,200			234,551,922

End of period*	$	259,762,600		$	248,523,200

* Includes undistributed net investment income of:	$	58,824		$	54,968

See accompanying notes to financial statements.

16 | Aquila Narragansett Tax-Free Income Fund

AQUILA NARRAGANSETT TAX-FREE INCOME FUND

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2016 (unaudited)

1. Organization

Aquila Narragansett Tax-Free Income Fund (the “Fund”), a series of Aquila Municipal Trust and a non-diversified, open-end investment company, was organized on January 22, 1992 as a Massachusetts business trust and commenced operations on September 10, 1992. Class A Shares are sold at net asset value plus a sales charge of varying size (depending upon a variety of factors) paid at the time of purchase and bear a distribution fee. Class C Shares are sold at net asset value with no sales charge payable at the time of purchase but with a level charge for service and distribution fees for six years thereafter. Class C Shares automatically convert to Class A Shares after six years. Class Y Shares are sold only through authorized financial institutions acting for investors in a fiduciary, advisory, agency, custodial or similar capacity, and are not offered directly to retail customers. Class Y Shares are sold at net asset value with no sales charge, no redemption fee, no contingent deferred sales charge (“CDSC”) and no distribution fee. Class I Shares are offered and sold only through financial intermediaries and are not offered directly to retail customers. Class I Shares are sold at net asset value with no sales charge and no redemption fee or CDSC, although a financial intermediary may charge a fee for effecting a purchase or other transaction on behalf of its customers. Class I Shares carry a distribution and a service fee. All classes of shares represent interests in the same portfolio of investments and are identical as to rights and privileges but differ with respect to the effect of sales charges, the distribution and/or service fees borne by each class, expenses specific to each class, voting rights on matters affecting a single class and the exchange privileges of each class.

2. Significant Accounting Policies

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.

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AQUILA NARRAGANSETT TAX-FREE INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities

The following is a summary of the valuation inputs, representing 100% of the Fund’s investments, used to value the Fund’s net assets as of September 30, 2016:

Valuation Inputs*	Investments in Securities
Level 1 – Quoted Prices - Short-Term Investment	$	5,157,549
Level 2 – Other Significant Observable
Inputs – Municipal Bonds		255,575,834
Level 3 – Significant Unobservable Inputs		–
Total	$	260,733,383

*See schedule of investments for a detailed listing of securities.

c)	Subsequent events: In preparing these financial statements, the Fund has evaluated events and transactions for potential recognition or disclosure through the date these financial statements were issued.

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AQUILA NARRAGANSETT TAX-FREE INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Reclassification of capital accounts: Accounting principles generally accepted in the United States of America require that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting. On March 31, 2016, the Fund decreased additional paid-in capital by $73,498 and increased accumulated net realized loss on investments by $73,498. These reclassifications had no effect on net assets or net asset value per share.

i)	The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 “Financial Services-Investment Companies”.

3. Fees and Related Party Transactions

a) Management Arrangements:

Citizens Investment Advisors, a department of Citizens Bank, N.A. (the “Sub-Adviser”), serves as the Investment Sub-Adviser for the Fund under a Sub-Advisory Agreement between the Manager and the Sub-Adviser. Under this agreement, the Sub-Adviser continuously provides, subject to oversight of the Manager and the Board of Trustees of the Fund, the investment program of the Fund and the composition of its portfolio, arranges for the purchases and sales of portfolio securities, and provides for daily pricing of the Fund’s portfolio. For its services, the Sub-Adviser is entitled to receive a fee from the Manager which is payable monthly and computed as of the close of business each day at the annual rate of 0.23% on the Fund’s net assets.

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AQUILA NARRAGANSETT TAX-FREE INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

The Manager has contractually undertaken to waive fees and/or reimburse Fund expenses so that total Fund expenses will not exceed 0.84% for Class A Shares, 1.69% for Class C Shares, 0.98% for Class I Shares and 0.69% for Class Y Shares through September 30, 2017. The Manager may not terminate the arrangement without the approval of the Board of Trustees. For the six months ended September 30, 2016, the Fund incurred management fees of $649,199 of which $103,872 was waived, which included supplemental fee waivers above and beyond the contractual expense cap.

Specific details as to the nature and extent of the services provided by the Manager and the Sub-Adviser are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

b) Distribution and Service Fees:

The Fund has adopted a Distribution Plan (the “Plan”) pursuant to Rule 12b-1 (the “Rule”) under the Investment Company Act of 1940. Under one part of the Plan, with respect to Class A Shares, the Fund is authorized to make distribution fee payments to broker-dealers or others (“Qualified Recipients”) selected by Aquila Distributors LLC (“the Distributor”), including, but not limited to, any principal underwriter of the Fund with which the Distributor has entered into written agreements contemplated by the Rule and which have rendered assistance in the distribution and/or retention of the Fund’s shares or servicing of shareholder accounts. The Fund makes payment of this distribution fee at the annual rate of 0.15% of the Fund’s average net assets represented by Class A Shares. For the six months ended September 30, 2016, distribution fees on Class A Shares amounted to $102,822, of which the Distributor retained $6,593.

Under another part of the Plan, the Fund is authorized to make payments with respect to Class C Shares to Qualified Recipients which have rendered assistance in the distribution and/or retention of the Fund’s Class C Shares or servicing of shareholder accounts. These payments are made at the annual rate of 0.75% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, amounted to $55,062. In addition, under a Shareholder Services Plan, the Fund is authorized to make service fee payments with respect to Class C Shares to Qualified Recipients for providing personal services and/or maintenance of shareholder accounts. These payments are made at the annual rate of 0.25% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, amounted to $18,354 The total of these payments with respect to Class C Shares amounted to $73,416, of which the Distributor retained $17,927.

Under another part of the Plan, the Fund is authorized to make payments with respect to Class I Shares to Qualified Recipients. Class I payments, under the Plan, may not exceed, for any fiscal year of the Fund a rate (currently 0.10%) set from time to time by the Board of Trustees of not more than 0.25% of the average annual net assets represented by the Class I Shares. In addition, the Fund has a Shareholder Services Plan under which it may pay service fees (currently 0.25%) of not more than 0.25% of the average annual net assets of the Fund represented by Class I Shares. That is, the total payments under both plans will not exceed 0.50% of such net assets. For the six months ended September 30, 2016, these payments were made at the average annual rate of 0.35% of such net assets amounting to $373 of which $107 related to the Plan and $266 related to the Shareholder Services Plan.

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AQUILA NARRAGANSETT TAX-FREE INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Specific details about the Plans are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

Under a Distribution Agreement, the Distributor serves as the exclusive distributor of the Fund’s shares. Through agreements between the Distributor and various brokerage and advisory firms (“intermediaries”), the Fund’s shares are sold primarily through the facilities of these intermediaries having offices within Rhode Island, with the bulk of any sales commissions inuring to such intermediaries. For the six months ended September 30, 2016, total commissions on sales of Class A Shares amounted to $175,070, of which the Distributor received $22,412.

4. Purchases and Sales of Securities

During the six months ended September 30, 2016, purchases of securities and proceeds from the sales of securities aggregated $28,935,980 and $15,060,976, respectively.

At September 30, 2016, the aggregate tax cost for all securities was $247,365,246. At September 30, 2016, the aggregate gross unrealized appreciation for all securities in which there is an excess of value over tax cost amounted to $13,446,826 and aggregate gross unrealized depreciation for all securities in which there is an excess of tax cost over value amounted to $78,689 for a net unrealized appreciation of $13,368,137.

5. Portfolio Orientation

Since the Fund invests principally and may invest entirely in double tax-free municipal obligations of issuers within Rhode Island, it is subject to possible risks associated with economic, political, or legal developments or industrial or regional matters specifically affecting Rhode Island and whatever effects these may have upon Rhode Island issuers’ ability to meet their obligations.

The Fund is also permitted to invest in U.S. territorial municipal obligations meeting comparable quality standards and providing income which is exempt from both regular Federal and Rhode Island income taxes. The general policy of the Fund is to invest in such securities only when comparable securities of Rhode Island issuers are not available in the market. At September 30, 2016, the Fund had all of its net assets invested in the securities of Rhode Island issuers.

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AQUILA NARRAGANSETT TAX-FREE INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

6. Capital Share Transactions

Transactions in Capital Shares of the Fund were as follows:

	Six Months Ended
	September 30, 2016						Year Ended
	(unaudited)						March 31, 2016

	Shares			Amount			Shares			Amount
Class A Shares:
Proceeds from shares sold		741,224		$	8,165,078			1,715,927		$	18,478,923
Reinvested distributions		100,830			1,108,920			200,947			2,161,609
Cost of shares redeemed		(638,278	)		(7,039,128	)		(1,319,865	)		(14,154,270	)
Net change		203,776			2,234,870			597,009			6,486,262
Class C Shares:
Proceeds from shares sold		219,981			2,420,065			307,844			3,302,093
Reinvested distributions		5,205			57,226			14,299			153,694
Cost of shares redeemed		(237,477	)		(2,617,187	)		(533,097	)		(5,721,400	)
Net change		(12,291	)		(139,896	)		(210,954	)		(2,265,613	)
Class I Shares:
Proceeds from shares sold		—			—			—			—
Reinvested distributions		230			2,529			567			6,095
Cost of shares redeemed		(2,920	)		(32,171	)		(1,801	)		(19,554	)
Net change		(2,690	)		(29,642	)		(1,234	)		(13,459	)
Class Y Shares:
Proceeds from shares sold		1,198,992			13,198,107			1,194,410			12,868,239
Reinvested distributions		36,124			398,056			68,471			737,198
Cost of shares redeemed		(542,735	)		(5,981,910	)		(601,631	)		(6,470,391	)
Net change		692,381			7,614,253			661,250			7,135,046
Total transactions in Fund
shares		881,176		$	9,679,585			1,046,071		$	11,342,236

7. Trustees’ Fees and Expenses

For the six months ended September 30, 2016, there were 9 Trustees, one of whom is affiliated with the Manager and is not paid any fees. The total amount of Trustees’ service fees (for carrying out their responsibilities) and attendance fees paid during the six months ended September 30, 2016 was $37,034. Attendance fees are paid to those in attendance at regularly scheduled quarterly Board Meetings and meetings of the Independent Trustees held prior to each quarterly Board Meeting, as well as additional meetings (such as Audit, Nominating, Shareholder and special meetings). Trustees are reimbursed for their expenses such as travel, accommodations and meals incurred in connection with attendance at Board Meetings and the Annual Meeting of Shareholders. For the six months ended September 30, 2016, such meeting-related expenses amounted to $9,822.

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AQUILA NARRAGANSETT TAX-FREE INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

8. Securities Traded on a When-Issued Basis

9. Income Tax Information and Distributions

The Fund declares dividends daily from net investment income and makes payments monthly. Net realized capital gains, if any, are distributed annually and are taxable. These distributions are paid in additional shares at the net asset value per share, in cash, or in a combination of both, at the shareholder’s option.

The Fund intends to maintain, to the maximum extent possible, the tax-exempt status of interest payments received from portfolio municipal securities in order to allow dividends paid to shareholders from net investment income to be exempt from regular Federal and State of Rhode Island income taxes. Due to differences between financial statement reporting and Federal income tax reporting requirements, distributions made by the Fund may not be the same as the Fund’s net investment income, and/or net realized securities gains. Further, a small portion of the dividends may, under some circumstances, be subject to taxes at ordinary income rates. As a result of the passage of the Regulated Investment Company Act of 2010 (“the Act”), losses incurred in this fiscal year and beyond retain their character as short-term or long-term, have no expiration date and are utilized before capital losses incurred prior to the enactment of the Act.

At March 31, 2016, the Fund had a capital loss carryover of $1,310,603 which is short-term and has no expiration. This carryover is available to offset future net realized gains on securities transactions to the extent provided for in the Internal Revenue Code.

The tax character of distributions was as follows:

	Year		Year
	Ended		Ended
	March 31, 2016		March 31, 2015
Net tax-exempt income	$	6,580,306	$	6,990,708
Ordinary Income		—		11,570
	$	6,580,306	$	7,002,278

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AQUILA NARRAGANSETT TAX-FREE INCOME FUND

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

As of March 31, 2016, the components of distributable earnings on a tax basis were as follows:

Undistributed tax-exempt income	$	215,929
Accumulated net realized loss		(1,310,603	)
Unrealized appreciation		11,940,021
Other temporary differences		(199,005	)
	$	10,646,342

The difference between book basis and tax basis unrealized appreciation and undistributed income is due to the timing difference, and other temporary differences, in recognizing dividends paid and the amortization of discount securities.

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AQUILA NARRAGANSETT TAX-FREE INCOME FUND

FINANCIAL HIGHLIGHTS

For a share outstanding throughout each period

	Class A
	Six Months Ended 9/30/16			Year Ended			Year Ended			Year Ended			Nine Months Ended			Year Ended June 30,
	(unaudited)			3/31/16			3/31/15			3/31/14			3/31/13 †			2012			2011
Net asset value, beginning of period	$	10.92		$	10.81		$	10.48		$	10.79		$	10.78		$	10.51		$	10.64
Income (loss) from investment operations:
Net investment income(1)		0.14			0.30			0.33			0.35			0.26			0.37			0.39
Net gain (loss) on securities (both
realized and unrealized)		0.07			0.11			0.33			(0.31	)		0.02			0.27			(0.13	)
Total from investment operations		0.21			0.41			0.66			0.04			0.28			0.64			0.26
Less distributions (note 9):
Dividends from net investment income		(0.14	)		(0.30	)		(0.33	)		(0.35	)		(0.27	)		(0.37	)		(0.39	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.14	)		(0.30	)		(0.33	)		(0.35	)		(0.27	)		(0.37	)		(0.39	)
Net asset value, end of period	$	10.99		$	10.92		$	10.81		$	10.48		$	10.79		$	10.78		$	10.51
Total return (not reflecting sales charge)		1.93	%(2)		3.85	%		6.35	%		0.42	%		2.53	%(2)		6.15	%		2.48	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	136		$	133		$	125		$	119		$	143		$	146		$	150
Ratio of expenses to average net assets		0.78	%(3)		0.77	%		0.76	%		0.79	%(4)		0.77	%(3)		0.71	%		0.62	%
Ratio of net investment income to
average net assets		2.57	%(3)		2.78	%		3.07	%		3.34	%(4)		3.22	%(3)		3.45	%		3.68	%
Portfolio turnover rate		6	%(2)		19	%		8	%		15	%		8	%(2)		11	%		9	%

Expense and net investment income ratios without the effect of the contractual expense cap and additional voluntary fee waivers were (note 3):

Ratio of expenses to average net assets		0.86	%(3)		0.85	%		0.88	%		0.92	%(4)		0.90	%(3)		0.87	%		0.84	%
Ratio of net investment income to
average net assets		2.49	%(3)		2.70	%		2.95	%		3.21	%(4)		3. 09	%(3)		3.29	%		3.46	%

__________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.88% and 3.25%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

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FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class C
	Six Months Ended 9/30/16			Year Ended			Year Ended			Year Ended			Nine Months Ended			Year Ended June 30,
	(unaudited)			3/31/16			3/31/15			3/31/14			3/31/13†			2012			2011
Net asset value, beginning of period	$	10.92		$	10.81		$	10.48		$	10.79		$	10.78		$	10.51		$	10.64
Income (loss) from investment operations:
Net investment income(1)		0.10			0.21			0.24			0.26			0.19			0.28			0.30
Net gain (loss) on securities (both
realized and unrealized)		0.07			0.11			0.33			(0.31	)		0.02			0.27			(0.13	)
Total from investment operations		0.17			0.32			0.57			(0.05	)		0.21			0.55			0.17
Less distributions (note 9):
Dividends from net investment income		(0.10	)		(0.21	)		(0.24	)		(0.26	)		(0.20	)		(0.28	)		(0.30	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.10	)		(0.21	)		(0.24	)		(0.26	)		(0.20	)		(0.28	)		(0.30	)
Net asset value, end of period	$	10.99		$	10.92		$	10.81		$	10.48		$	10.79		$	10.78		$	10.51
Total return (not reflecting sales charge)		1.50	%(2)		2.97	%		5.45	%		(0.43	)%		1.88	%(2)		5.25	%		1.62	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	14		$	14		$	16		$	16		$	22		$	21		$	24
Ratio of expenses to average net assets		1.63	%(3)		1.62	%		1.61	%		1.64	%(4)		1.62	%(3)		1.57	%		1.47	%
Ratio of net investment income to
average net assets		1.72	%(3)		1.93	%		2.22	%		2.49	%(4)		2.37	%(3)		2.60	%		2.83	%
Portfolio turnover rate		6	%(2)		19	%		8	%		15	%		8	%(2)		11	%		9	%

Expense and net investment income ratios without the effect of the contractual expense cap and additional voluntary fee waivers were (note 3):

Ratio of expenses to average net assets		1.71	%(3)		1.70	%		1.73	%		1.77	%(4)		1.75	%(3)		1.72	%		1.69	%
Ratio of net investment income to
average net assets		1.63	%(3)		1.85	%		2.10	%		2.36	%(4)		2.24	%(3)		2.45	%		2.61	%

__________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 1.73% and 2.40%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

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FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class I
	Six Months Ended 9/30/16			Year Ended			Year Ended			Year Ended			Nine Months Ended			Year Ended June 30,
	(unaudited)			3/31/16			3/31/15			3/31/14			3/31/13†			2012			2011
Net asset value, beginning of period	$	10.92		$	10.80		$	10.47		$	10.79		$	10.78		$	10.51		$	10.63
Income (loss) from investment operations:
Net investment income(1)		0.13			0.28			0.31			0.33			0.25			0.35			0.37
Net gain (loss) on securities (both
realized and unrealized)		0.07			0.12			0.33			(0.32	)		0.01			0.27			(0.12	)
Total from investment operations		0.20			0.40			0.64			0.01			0.26			0.62			0.25
Less distributions (note 9):
Dividends from net investment income		(0.13	)		(0.28	)		(0.31	)		(0.33	)		(0.25	)		(0.35	)		(0.37	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.13	)		(0.28	)		(0.31	)		(0.33	)		(0.25	)		(0.35	)		(0.37	)
Net asset value, end of period	$	10.99		$	10.92		$	10.80		$	10.47		$	10.79		$	10.78		$	10.51
Total return		1.86	% (2)		3.80	%		6.20	%		0.17	%		2.41	%(2)		5.99	%		2.42	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	0.2		$	0.2		$	0.2		$	0.3		$	0.3		$	0.3		$	0.3
Ratio of expenses to average net assets		0.92	%(3)		0.92	%		0.90	%		0.94	%(4)		0.93	%(3)		0.87	%		0.78	%
Ratio of net investment income to
average net assets		2.43	%(3)		2.63	%		2.93	%		3.18	%(4)		3.07	%(3)		3.29	%		3.25	%
Portfolio turnover rate		6	%(2)		19	%		8	%		15	%		8	%(2)		11	%		9	%

Expense and net investment income ratios without the effect of the contractual expense cap and additional voluntary fee waivers were (note 3):

Ratio of expenses to average net assets		1.00	%(3)		1.00	%		1.02	%		1.07	%(4)		1.06	%(3)		1.02	%		1.00	%
Ratio of net investment income to
average net assets		2.35	%. (3)		2.55	%		2.81	%		3.05	%(4)		2.94	%(3)		3.14	%		3.30	%

__________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 1.03% and 3.09%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

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FINANCIAL ENDED HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class Y
	Six Months
	Ended 9/30/16			Year Ended			Year Ended			Year Ended			Nine Months Ended			Year Ended June 30,
	(unaudited)			3/31/16			3/31/15			3/31/14			3/31/13†			2012			2011
Net asset value, beginning of period	$	10.92		$	10.81		$	10.48		$	10.79		$	10.78		$	10.51		$	10.64
Income (loss) from investment operations:
Net investment income(1)		0.15			0.31			0.34			0.36			0.28			0.38			0.40
Net gain (loss) on securities (both
realized and unrealized)		0.07			0.11			0.33			(0.31	)		–			0.27			(0.13	)
Total from investment operations		0.22			0.42			0.67			0.05			0.28			0.65			0.27
Less distributions (note 9):
Dividends from net investment income		(0.15	)		(0.31	)		(0.34	)		(0.36	)		(0.27	)		(0.38	)		(0.40	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.15	)		(0.31	)		(0.34	)		(0.36	)		(0.27	)		(0.38	)		(0.40	)
Net asset value, end of period	$	10.99		$	10.92		$	10.81		$	10.48		$	10.79		$	10.78		$	10.51
Total return		2.01	%(2)		4.01	%		6.51	%		0.56	%		2.65	%(2)		6.31	%		2.64	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	109		$	101		$	93		$	86		$	93		$	82		$	67
Ratio of expenses to average net assets		0.62	%(3)		0.62	%		0.61	%		0.64	%(4)		0.62	%(3)		0.57	%		0.47	%
Ratio of net investment income to
average net assets		2.73	%(3)		2.92	%		3.22	%		3.48	%(4)		3.37	%(3)		3.59	%		3.83	%
Portfolio turnover rate		6	%(2)		19	%		8	%		15	%		8	%(2)		11	%		9	%

Expense and net investment income ratios without the effect of the contractual expense cap and additional voluntary fee waivers were (note 3):

Ratio of expenses to average net assets		0.71	%(3)		0.70	%		0.73	%		0.77	%(4)		0.75	%(3)		0.72	%		0.69	%
Ratio of net investment income to
average net assets		2.65	%(3)		2.84	%		3.10	%		3.35	%(4)		3.24	%(3)		3.43	%		3.61	%

__________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.73% and 3.39%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

28 | Aquila Narragansett Tax-Free Income Fund

Analysis of Expenses (unaudited)

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including front-end sales charges with respect to Class A shares or contingent deferred sales charges (“CDSC”) with respect to Class C shares; and (2) ongoing costs, including management fees; distribution (“12b-1”) and/or service fees; and other Fund expenses. The table below is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The table below is based on an investment of $1,000 invested on April 1, 2016 and held for the six months ended September 30, 2016.

Actual Expenses

Six months ended September 30, 2016

	Actual
	Total Return	Beginning	Ending	Expenses
	Without	Account	Account	Paid During
	Sales Charges(1)	Value	Value	the Period(2)
Class A	1.93%	$1,000.00	$1,019.30	$3.95
Class C	1.50%	$1,000.00	$1,015.00	$8.23
Class I	1.86%	$1,000.00	$1,018.60	$4.66
Class Y	2.01%	$1,000.00	$1,020.10	$3.14

(1)

(2)	Expenses are equal to the annualized expense ratio of 0.78%, 1.63%, 0.92% and 0.62% for the Fund’s Class A, C, I and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

29 | Aquila Narragansett Tax-Free Income Fund

Analysis of Expenses (unaudited) (continued)

Hypothetical Example for Comparison Purposes

Six months ended September 30, 2016

	Hypothetical
	Annualized	Beginning	Ending	Expenses
	Total	Account	Account	Paid During
	Return	Value	Value	the Period(1)
Class A	5.00%	$1,000.00	$1,021.16	$3.95
Class C	5.00%	$1,000.00	$1,016.90	$8.24
Class I	5.00%	$1,000.00	$1,020.46	$4.66
Class Y	5.00%	$1,000.00	$1,021.96	$3.14

(1)	Expenses are equal to the annualized expense ratio of 0.78%, 1.63%, 0.92% and 0.62% for the Trust’s Class A, C, I and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

30 | Aquila Narragansett Tax-Free Income Fund

Information Available (unaudited)

Proxy Voting Record (unaudited)

Federal Tax Status of Distributions (unaudited)

This information is presented in order to comply with a requirement of the Internal Revenue Code. No action on the part of shareholders is required.

For the fiscal year ended March 31, 2016, $6,580,306 of dividends paid by Aquila Narragansett Tax-Free Income Fund, constituting 100% of total dividends paid, were exempt-interest dividends.

Prior to February 15, 2017, shareholders will be mailed the appropriate tax form(s) which will contain information on the status of distributions paid for the 2016 calendar year.

31 | Aquila Narragansett Tax-Free Income Fund

Additional Information (unaudited)

Renewal of the Advisory and Administration Agreement and the Sub-Advisory Agreement

Aquila Investment Management LLC (the “Manager”) serves as the investment adviser to the Fund pursuant to an Advisory and Administration Agreement (the “Advisory Agreement”). The Manager has retained Citizens Investment Advisors, a department of Citizens Bank, N.A. (the “Sub-Adviser”) to serve as the sub-adviser to the Fund pursuant to a Sub-Advisory Agreement between the Manager and the Sub-Adviser (the “Sub-Advisory Agreement”). In order for the Manager and the Sub-Adviser to continue to serve in their respective roles, the Trustees of the Fund must determine annually whether to renew the Advisory Agreement and the Sub-Advisory Agreement for the Fund.

In considering whether to approve the renewal of the Advisory Agreement and the Sub-Advisory Agreement, the Trustees requested and obtained such information as they deemed reasonably necessary. Contract review materials were provided to the Trustees in August, 2016. The independent Trustees met telephonically on August 30, 2016 and in person on September 18, 2016 to review and discuss the contract review materials. The Trustees considered, among other things, information presented by the Manager and the Sub-Adviser. They also considered information presented in a report prepared by an independent consultant with respect to the Fund’s fees, expenses and investment performance, which included comparisons of the Fund’s investment performance against peers and the Fund’s benchmark and comparisons of the advisory fee payable by the Fund under the Advisory Agreement against the advisory fees paid by the Fund’s peers, as well as information regarding the operating margins of certain investment advisory firms (the “Consultant’s Report”). In addition, the Trustees took into account the information related to the Fund provided to the Trustees at each regularly scheduled meeting. The Trustees considered the Advisory Agreement and the Sub-Advisory Agreement separately as well as in conjunction with each other to determine their combined effects on the Fund.

At the meeting held on September 18, 2016, based on their evaluation of the information provided by the Manager, the Sub-Adviser and the independent consultant, the Trustees of the Fund, including the independent Trustees voting separately, unanimously approved the renewal of each of the Advisory Agreement and the Sub-Advisory Agreement until September 30, 2017. In considering the renewal of the Advisory Agreement and the Sub-Advisory Agreement, the Trustees considered various factors that they determined were relevant, including the factors described below. The Trustees did not identify any single factor as the controlling factor in determining to approve the renewal of the Advisory Agreement or the Sub-Advisory Agreement.

The nature, extent, and quality of the services provided by the Manager and the Sub-Adviser.

The Trustees considered the nature, extent and quality of the services that had been provided by the Manager and the Sub-Adviser to the Fund, taking into account the investment objectives and strategies of the Fund. The Trustees reviewed the terms of the Advisory Agreement and the Sub-Advisory Agreement.

32 | Aquila Narragansett Tax-Free Income Fund

The Manager has retained the Sub-Adviser to provide investment management of the Fund’s portfolio. The Trustees reviewed the Sub-Adviser’s investment approach for the Fund. The Trustees considered the personnel of the Sub-Adviser who provide investment management services to the Fund. The Trustees noted the extensive experience of the Sub-Adviser’s portfolio manager, Mr. Jeffrey Hanna. They considered that Mr. Hanna is based in Providence, Rhode Island and that he has a comprehensive understanding regarding the economy of the State of Rhode Island and the securities in which the Fund invests, including those securities with less than the highest ratings from the rating agencies. The Trustees also noted that the Fund did not own any Puerto Rico municipal bonds during the review period.

The Trustees considered that the Manager supervised and monitored the performance of the Sub-Adviser. The Trustees also considered that the Manager and the Sub-Adviser had provided all advisory services to the Fund that the Trustees deemed necessary or appropriate, including the specific services that the Trustees have determined are required for the Fund, given that it seeks to provide shareholders with as high a level of current income exempt from Rhode Island state and regular Federal income taxes as is consistent with preservation of capital.

The Trustees also noted that the Manager has additionally provided all administrative services to the Fund and provided the Fund with personnel (including Fund officers) and other resources that are necessary for the Fund’s business management and operations. The Trustees considered the nature and extent of the Manager’s supervision of third-party service providers, including the Fund’s fund accountant, shareholder servicing agent and custodian.

Based on these considerations, the Trustees concluded that the nature, extent and quality of services that had been provided by the Manager and the Sub-Adviser to the Fund were satisfactory and consistent with the terms of the Advisory Agreement and Sub-Advisory Agreement, respectively.

The investment performance of the Fund.

The Trustees reviewed the Fund’s performance (Class A shares) and compared its performance to the performance of:

•

the funds in the Fund’s peer group (the “Peer Group”), as selected by the independent consultant (six single-state intermediate and single-state long municipal bond funds, as classified by Morningstar, that are similar to the Fund in size and that charge a front-end sales charge);

•

the Fund’s benchmark index, the Barclays Capital Quality Intermediate Municipal Bond Index.

The Trustees considered that the materials included in the Consultant’s Report indicated that the Fund’s average annual total return was higher than the average annual total return of the funds in the Peer Group for the one, three and five-year periods but 0.01% lower than the average annual total return of the funds in the Peer Group for the ten-year period ended June 30, 2016. They also considered that the Fund’s average annual total return was higher than the average annual total return of the funds in the Product Category for Performance for the one, three, five and ten-year periods ended June 30, 2016. The Trustees noted that the Fund’s average annual return was higher than that of its benchmark index for the one, three and five-year periods but was lower than the average annual return of the benchmark index for the ten-year period ended June 30, 2016. The Trustees further determined that, as reflected in the Consultant’s Report, the Fund delivered above-average results on a risk-adjusted basis for the three and five year periods ended June 30, 2016 (as evidenced by its Sharpe ratio) when compared to the funds in the Product Category for Performance. The Trustees noted that the Fund was the only Rhode Island state-specific tax-free municipal bond fund. They also noted that, unlike the Fund’s returns, the performance of the benchmark index did not reflect any fees, expenses or sales charges.

33 | Aquila Narragansett Tax-Free Income Fund

Advisory Fees and Sub-Advisory Fees and Fund Expenses.

The Trustees evaluated the fee payable under the Advisory Agreement. They noted that the Manager, and not the Fund, paid the Sub-Adviser under the Sub-Advisory Agreement. The Trustees evaluated both the fee under the Sub-Advisory Agreement and the portion of the advisory fee paid under the Advisory Agreement and retained by the Manager. The Trustees reviewed the Fund’s advisory fees and expenses and compared them to the advisory fee and expense data for:

•

the funds in the Peer Group (as defined above); and

•

the funds in the product category for expenses (the “Product Category for Expenses”) (Morningstar Single-State Intermediate Municipal Bond Funds and Morningstar Single State Long Municipal Bond Funds from states within which 1-3 mutual funds are operating, with similar operating expense structures).

The Trustees considered that the Fund’s contractual advisory fee was equal to the median, but higher than the average, contractual advisory fees of the funds in the Peer Group (at the Fund’s current asset level). They also considered that the Fund’s contractual advisory fee was lower than the asset-weighted average contractual advisory fee of the funds in the Product Category for Expenses at the Fund’s current asset level and up to $1 billion in assets.

The Trustees noted that the Fund’s actual management fee was higher than the average actual management fee of the funds in the Peer Group (after giving effect to fee waivers in effect for those funds) but lower than the average actual management fee of the funds in the Product Category for Expenses (after giving effect to fee waivers in effect for those funds). They noted, however, that the Fund’s actual expenses (for Class A shares) were lower than the average actual expenses of the funds in both the Product Category for Expenses and the Peer Group (after giving effect to fee waivers and expense reimbursements in effect for those funds).

34 | Aquila Narragansett Tax-Free Income Fund

The Trustees reviewed management fees charged by each of the Manager and the Sub-Adviser to its other clients. It was noted that the Manager does not have any other clients except for other funds in the Aquila Group of Funds. The Trustees noted that, in most instances, the fee rates for those clients were comparable to the fees paid to the Manager by the Fund. With respect to the Sub-Adviser, the Trustees noted that the fee rates for its other clients were generally lower than the fees paid to the Sub-Adviser with respect to the Fund. In evaluating the fees associated with the client accounts, the Trustees took into account the respective demands, resources and complexity associated with the Fund and those client accounts.

The Trustees considered that the Manager and, in turn, the Sub-Adviser was currently waiving a portion of its fees and had been since the Fund’s inception. Additionally, it was noted that the Manager had indicated that it intended to continue waiving fees as necessary for the Fund to remain competitive.

The Trustees concluded that the advisory and sub-advisory fees were reasonable in relation to the nature and quality of the services provided to the Fund by the Manager and the Sub-Adviser.

Profitability

The Trustees received materials from the Manager and from the independent consultant related to profitability. The Manager provided information which showed the profitability to the Manager of its services to the Fund, as well as the profitability of Aquila Distributors LLC of distribution services provided to the Fund. The independent consultant provided publicly available data regarding the profitability of other asset managers in comparison to the overall profitability of the Manager.

The Trustees considered the information provided by the Manager regarding the lack of profitability of the Manager with respect to the advisory services provided by the Manager to the Fund, including the methodology used by the Manager in allocating certain of its costs to the management of the Fund. The Trustees also considered information regarding the profitability of the Manager provided to the Trustees by the independent consultant. The Trustees concluded that profitability to the Manager with respect to advisory services provided to the Fund did not argue against approval of the fees to be paid under the Advisory Agreement.

The Trustees also considered information provided by the Sub-Adviser regarding the profitability of the Sub-Adviser with respect to the sub-advisory services provided by the Sub-Adviser to the Fund. The Trustees concluded that the profitability of the Sub-Adviser with respect to sub-advisory services provided to the Fund did not argue against approval of the fees to be paid under the Sub-Advisory Agreement.

The extent to which economies of scale would be realized as the Fund grows.

The Trustees considered the extent to which the Manager and the Sub-Adviser may realize economies of scale or other efficiencies in managing the Fund. The Trustees considered that the materials indicated that the Fund’s fees, after fee waivers, were generally comparable to those of its peers, including those funds with breakpoints in the advisory fee schedule. Additionally, the Trustees noted that the Manager continued to waive a portion of its fees. The Trustees noted that the Manager’s profitability also may be an indicator of the availability of any economies of scale. Accordingly, the Trustees concluded that economies of scale, if any, were being appropriately shared with the Fund.

35 | Aquila Narragansett Tax-Free Income Fund

Benefits derived or to be derived by the Manager and the Sub-Adviser and their affiliates from their relationships with the Fund.

The Trustees observed that, as is generally true of most fund complexes, the Manager and Sub-Adviser and their affiliates, by providing services to a number of funds or other investment clients including the Fund, were able to spread costs as they would otherwise be unable to do. The Trustees noted that while that could produce efficiencies and increased profitability for the Manager and Sub-Adviser and their affiliates, it also makes their services available to the Fund at favorable levels of quality and cost which are more advantageous to the Fund than would otherwise have been possible.

See accompanying notes to financial statements.

36 | Aquila Narragansett Tax-Free Income Fund

(THIS PAGE INTENTIONALLY LEFT BLANK)

Founders

Lacy B. Herrmann (1929-2012)

Aquila Management Corporation, Sponsor

Manager

AQUILA INVESTMENT MANAGEMENT LLC 120

West 45th Street, Suite 3600

New York, New York 10036

Investment Sub-Adviser

CITIZENS INVESTMENT ADVISORS,

A DEPARTMENT OF CITIZENS BANK, N. A.

One Citizens Plaza

Providence, Rhode Island 02903

Board of Trustees

John C. Lucking, Chair

Diana P. Herrmann, Vice Chair

Ernest Calderón

Thomas A. Christopher

Gary C. Cornia

Grady Gammage, Jr.

Glenn P. O’Flaherty

James R. Ramsey

Laureen L. White

Officers

Diana P. Herrmann, President

Charles E. Childs, III, Executive Vice President

and Secretary

Marie E. Aro, Senior Vice President

Stephen J. Caridi, Senior Vice President

Paul G. O’Brien, Senior Vice President

Randall S. Fillmore, Chief Compliance Officer

Joseph P. DiMaggio, Chief Financial Officer

and Treasurer

Distributor

AQUILA DISTRIBUTORS LLC

120 West 45th Street, Suite 3600

New York, New York 10036

Transfer and Shareholder Servicing Agent

BNY MELLON INVESTMENT SERVICING (US) INC.

4400 Computer Drive

Westborough, Massachusetts 01581

Custodian

THE BANK OF NEW YORK MELLON

225 Liberty Street

New York, New York 10286

Further information is contained in the Prospectus,

which must precede or accompany this report.

Semi-Annual

Report

September 30, 2016

Please Save the Date for Your 2017 Shareholder Meeting

Wednesday, May 17, 2017

Wellshire Event Center, Denver

Details will be available on our website as the date approaches:

www.aquilafunds.com

or through your financial professional

Aquila Tax-Free

Fund of Colorado

“The Role of Trustees”

Serving Colorado investors since 1987

November, 2016

Dear Fellow Shareholder:

Under applicable state law, Trustees are charged, as their primary responsibility, with safeguarding the interests of shareholders. As such, your Trustees seek to act in your best interests, putting your interests ahead of their own interests and those of anyone else, in overseeing the policies and procedures of Aquila Tax-Free Fund of Colorado (your “Fund”), as well as the services provided by your Fund’s key service providers.

The 1940 Act requires your Board of Trustees to review certain of your Fund’s contracts on at least an annual basis, at which time, the majority of your Trustees, including a majority of the independent Trustees, must be present in person. Moreover, in their review of the contracts with your Fund’s adviser and sub-adviser, the Trustees seek to consider certain factors and their conclusions are disclosed to you in your Fund’s next annual or semi-annual report (as is the case with this semi-annual report). Your Trustees’ other key responsibilities include oversight of your Fund’s compliance policies and procedures, valuation and risk management.

Selection and nomination of independent Trustees is by the existing independent Trustees. As detailed in the Nominating Committee Charter which is available on your Fund’s website (www.aquilafunds.com), your Board of Trustees seeks to develop and maintain a board of high quality, independence and integrity to best serve your interests. The Trustees associated with the Aquila Group of Funds are additionally selected on the basis of being accomplished individuals of diverse backgrounds from various parts of the United States, including Colorado. Through this diversity, we strive to provide your Fund with a broad breadth and balance of knowledge and experience. Biographical and other information on your Board of Trustees is available on our website and, by law, is included in your Fund’s annual report and Statement of Additional Information.

NOT A PART OF THE SEMI-ANNUAL REPORT

Although, not required, Trustees in the Aquila Group of Funds self-impose some additional criteria.

•

In addition to overseeing your Fund, all Trustees are also fellow shareholders. While Trustees, like any investor, must consider, among other things, their own personal investment objectives (including tax benefits afforded the investment by their state of residence) when deciding upon the size of their investment in Aquila Tax-Free Fund of Colorado, we believe it is important that each Trustee has “some skin the game.”

•

Consideration is given to including local residents as Trustees. In this way, the Fund can benefit from their hands-on insight and knowledge of their State.

In short, your Board of Trustees are your “watchdogs,” looking over operations of Aquila Tax-Free Fund of Colorado.

It has been our experience that those who have undertaken to serve as Trustees diligently devote their energies, talents and experience to furthering the interests of you, our shareholders.

Sincerely,

Diana P. Herrmann, Vice Chair and President

NOT A PART OF THE SEMI-ANNUAL REPORT

Mutual fund investing involves risk and loss of principal is possible.

The value of your investment may go down when interest rates rise. A rise in interest rates tends to have a greater impact on the prices of longer term securities. Conversely, when interest rates fall, the value of your investment may rise. Interest rates in the U.S. recently have been historically low , so the Fund faces a heightened risk that interest rates may rise. A general rise in interest rates may cause investors to move out of fixed income securities and could also result in increased redemptions from the Fund.

Investments in the Fund are subject to possible loss due to the financial failure of the issuers of underlying securities and their inability to meet their debt obligations.

A portion of income may be subject to local, state, Federal and/or alternative minimum tax. Capital gains, if any, are subject to capital gains tax.

These risks may result in share price volatility.

Past performance is no guarantee of future results, and there is no guarantee that any market forecasts discussed will be realized.

NOT A PART OF THE SEMI-ANNUAL REPORT

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (22.6%)	Rating Moody’s, S&P and Fitch	Value

		Hospital (0.7%)
		Rangely, Colorado Hospital
		District Refunding
$	2,000,000	5.500%, 11/01/22	Baa1/NR/NR	$	2,336,020

		Metropolitan District (2.6%)
		Denver, Colorado Urban Renewal Authority,
		Tax Increment Revenue,
		Stapleton Senior Series A-1
	2,600,000	5.000%, 12/01/25	NR/NR/A-		3,099,382
		Denver, Colorado Urban Renewal
		Authority, Tax Increment Revenue,
		Stapleton Senior Series B-1
	1,000,000	5.000%, 12/01/25	Aa3/NR/NR		1,269,940
		Meridian Metropolitan District,
		Colorado Refunding Series A
	1,645,000	4.500%, 12/01/23	NR/A-/A		1,867,059
		Poudre Tech Metropolitan District,
		Colorado Unlimited Property Tax
		Supported Revenue Refunding &
		Improvement, Series B
	1,990,000	5.000%, 12/01/28 AGMC Insured	NR/AA/NR		2,254,929
		Total Metropolitan District .			8,491,310

		School Districts (18.9%)
		Adams 12 Five Star Schools, Colorado
	3,000,000	5.000%, 12/15/25	Aa2/AA-/NR		3,759,420
	1,000,000	5.000%, 12/15/25	Aa2/AA-/NR		1,276,840
		Adams County, Colorado School
		District #50
	1,000,000	4.000%, 12/01/23	Aa2/AA-/NR		1,166,300
	3,000,000	4.000%, 12/01/24	Aa2/AA-/NR		3,479,580
		Adams & Weld Counties, Colorado
		School District #27J
	1,030,000	5.000%, 12/01/22	Aa2/AA-/NR		1,252,686
	2,000,000	5.000%, 12/01/24	Aa2/AA-/NR		2,425,820
	1,000,000	5.000%, 12/01/25	Aa2/AA-/NR		1,271,230
	1,060,000	5.000%, 12/01/28	Aa2/AA-/NR		1,336,946
	3,895,000	5.000%, 12/01/29	Aa2/AA-/NR		4,875,449

1 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		School Districts (continued)
		Arapahoe County, Colorado School
		District #001 Englewood
$	1,465,000	5.000%, 12/01/27	Aa2/NR/NR	$	1,859,041
		Arapahoe County, Colorado School
		District #006 Littleton
	1,000,000	5.000%, 12/01/27	Aa1/NR/NR		1,282,430
		Boulder Larimer & Weld Counties,
		Colorado
	2,000,000	5.000%, 12/15/27	Aa2/AA/NR		2,553,680
		Boulder Larimer & Weld Counties,
		Colorado Series A
	2,000,000	5.000%, 12/15/24	Aa2/AA/NR		2,560,880
		Denver, Colorado City & County
		School District No. 1
	3,000,000	4.000%, 12/01/26	Aa2/AA/AA+		3,404,220
	2,000,000	4.000%, 12/01/27	Aa2/AA/AA+		2,373,540
		Denver, Colorado City & County
		School District No. 1 Series B
	2,000,000	5.000%, 12/01/25	Aa2/AA/AA+		2,535,420
	4,000,000	5.000%, 12/01/27	Aa2/AA/AA+		5,025,440
		Eagle County School District, Colorado,
		Eagle, Garfield & Routt School
		District #50J
	1,170,000	5.000%, 12/01/25	Aa2/AA-/NR		1,437,029
		El Paso County, Colorado School
		District #20 Refunding
	1,945,000	4.375%, 12/15/23	Aa2/NR/NR		2,244,452
		Garfield, Pitkin, & Eagle Counties,
		Colorado School District
		#RE-1 Roaring Fork
	1,600,000	5.000%, 12/15/27	Aa2/NR/NR		2,047,632
		La Plata County, Colorado School
		District #9-R Durango Refunding
	3,000,000	4.500%, 11/01/23 .	Aa2/NR/NR		3,469,710
		Larimer County, Colorado School
		District No. R 1 Poudre
	1,000,000	5.000%, 12/15/27	Aa2/NR/NR		1,279,770

2 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		School Districts (continued)
		Larimer, Weld & Boulder Counties,
		Colorado School District No. R-2J,
		Thompson Refunding
$	1,500,000	4.250%, 12/15/24	Aa2/NR/NR	$	1,759,590
	750,000	4.500%, 12/01/26	Aa3/NR/NR		896,663
		Mesa County, Colorado Valley School
		District No. 051, Grand Junction
		Refunding
	3,000,000	5.000%, 12/01/23	Aa2/NR/NR		3,716,730
		San Miguel County, Colorado School
		District R-1 Telluride
	1,055,000	5.000%, 12/01/25	Aa2/AA/NR		1,343,004
		Summit County, Colorado School
		District No. RE 1 Refunding
	2,000,000	4.000%, 12/01/24	Aa1/NR/NR		2,254,560
		Total School Districts			62,888,062

		Water & Sewer (0.4%)
		Central Colorado Water Conservancy
		District, Adams Morgan & Weld Counties
	1,185,000	5.000%, 12/01/24	NR/A/NR		1,442,050
		Total General Obligation Bonds			75,157,442

		Revenue Bonds (52.7%)

		Airport (3.3%)
		Denver, Colorado City & County
		Airport Revenue System, Series A
	4,340,000	5.000%, 11/15/24	A1/A+/A+		5,014,696
	1,210,000	5.250%, 11/15/28	A1/A+/A+		1,356,035
	3,000,000	5.250%, 11/15/29	A1/A+/A+		3,363,060
		Walker Field, Colorado Public Airport
		Authority Airport Revenue
	1,000,000	5.000%, 12/01/22	Baa2/NR/NR		1,041,750
		Total Airport			10,775,541

3 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		City & County (1.0%)
		Boulder, Colorado Open Space Capital
		Improvement Trust Fund
$	2,530,000	5.000%, 12/15/27	NR/AA/NR	$	3,227,926

		Electric (3.0%)
		Colorado Springs, Colorado Utilities
		Revenue, Refunding Series A
	1,000,000	5.000%, 11/15/27	Aa2/AA/AA		1,267,780
	295,000	4.750%, 11/15/27	Aa2/AA/NR		326,692
		Colorado Springs, Colorado Utilities
		Revenue, Refunding Series A-1
	1,000,000	4.000%, 11/15/26	Aa2/AA/AA		1,103,090
	1,000,000	4.000%, 11/15/27	Aa2/AA/AA		1,097,200
		Colorado Springs, Colorado Utilities
		Revenue Refunding Series B
	2,600,000	5.000%, 11/15/23	Aa2/AA/AA		3,228,940
	420,000	5.250%, 11/15/23 (unrefunded portion).	Aa2/AA/NR		457,838
		Colorado Springs, Colorado
		Utilities Revenue, Series C-2
	1,060,000	5.000%, 11/15/23	Aa2/AA/AA		1,316,414
		Platte River Power Authority,
		Colorado Power
	1,000,000	4.000%, 06/01/26	NR/AA/AA		1,208,940
		Total Electric			10,006,894

		Higher Education (12.8%)
		Colorado Educational & Cultural Facility
		Authority, Student Housing - Campus
		Village Apartments Refunding
	2,935,000	5.375%, 06/01/28	NR/A/NR		3,124,366
		Colorado Educational & Cultural
		Facility Authority, University Corp.
		Atmosphere Project, Refunding
	1,700,000	5.000%, 09/01/22	A2/A+/NR		1,931,098
	1,635,000	5.000%, 09/01/28	A2/A+/NR		1,848,613
		Colorado Educational & Cultural Facility
		Authority, University of Denver Project
	845,000	4.000%, 03/01/24	A1/NR/NR		979,144
	7,000,000	5.250%, 03/01/25 NPFG Insured	A1/AA-/NR		8,838,340

4 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Higher Education (continued)
		Colorado Educational & Cultural Facility
		Authority Refunding, University of
		Denver Project
$	1,000,000	5.250%, 03/01/26 NPFG Insured	A1/AA-/NR	$	1,295,260
		Colorado State Board of Governors
		University Enterprise System, Series A
	2,300,000	5.000%, 03/01/25	Aa2/AA-/NR		2,734,861
		Colorado State Board of Governors
		University Enterprise System, Series C
	2,905,000	5.000%, 03/01/26	Aa2/AA-/NR		3,665,849
		University of Colorado Enterprise System
	1,270,000	5.000%, 06/01/25	Aa2/NR/AA+		1,588,237
		University of Colorado Enterprise
		System Series A
	2,620,000	5.000%, 06/01/29	Aa2/NR/AA+		3,265,358
	1,165,000	5.000%, 06/01/26 NPFG Insured	Aa2/NR/AA+		1,513,207
		University of Colorado Enterprise
		System, Refunding, Series B
	1,680,000	4.000%, 06/01/23	Aa2/NR/AA+		1,842,658
	1,500,000	5.000%, 06/01/26	Aa2/NR/AA+		1,948,335
		University of Northern Colorado Greeley
		Institutional Enterprise Refunding,
		SHEIP, Series A
	1,000,000	5.000%, 06/01/25	Aa2/AA-/NR		1,248,940
	2,810,000	5.000%, 06/01/26	Aa2/AA-/NR		3,257,464
	2,940,000	5.000%, 06/01/28	Aa2/AA-/NR		3,395,259
		Total Higher Education			42,476,989

		Hospital (3.9%)
		Colorado Health Facility Authority
		Hospital Revenue, Evangelical
		Lutheran Project
	450,000	5.250%, 06/01/19 (unrefunded portion)	Baa1/BBB+/NR		451,489
	290,000	5.250%, 06/01/21 (unrefunded portion)	Baa1/BBB+/NR		290,913
	575,000	5.250%, 06/01/24 (unrefunded portion)	Baa1/BBB+/NR		576,633
		Colorado Health Facility Authority
		Hospital Revenue, Valley View
		Hospital Association, Refunding
	1,500,000	5.500%, 05/15/28	NR/A-/NR		1,607,100

5 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Hospital (continued)
		Colorado Health Facility Authority,
		Catholic Health Initiatives, Series D
$	2,000,000	5.000%, 10/01/16	A3/A-/BBB+	$	2,000,000
	1,000,000	6.000%, 10/01/23	A3/A-/BBB+		1,106,600
		Colorado Health Facility Authority,
		Sisters Leavenworth, Refunding
	3,000,000	5.250%, 01/01/25	Aa3/AA-/AA-		3,389,910
		Denver, Colorado Health & Hospital
		Authority Healthcare, Series A Refunding
	2,000,000	5.000%, 12/01/18	NR/BBB/BBB+		2,013,100
	1,500,000	5.000%, 12/01/19	NR/BBB/BBB+		1,509,870
		Total Hospital			12,945,615

		Housing (0.2%)
		Colorado Housing Finance Authority,
		Single Family Mortgage Class III
		Series A-5
	590,000	5.000%, 11/01/34	A2/A/NR		607,334
		Colorado Housing and Finance Authority,
		Multi-Family Project C1-II Series A-2
	115,000	5.400%, 10/01/29	Aa2/AA/NR		117,299
		Total Housing			724,633

		Lease (12.2%)
		Adams 12 Five Star Schools,
		Colorado COP
	2,070,000	5.000%, 12/15/26	Aa3/NR/NR		2,659,909
	1,030,000	5.000%, 12/15/27	Aa3/NR/NR		1,338,516
		Arvada, Colorado COP
	1,190,000	4.000%, 12/01/29	NR/AA+/NR		1,379,269
		Aurora, Colorado COP, Refunding
		Series A
	1,500,000	5.000%, 12/01/26	Aa2/AA-/NR		1,671,015
		Brighton, Colorado COP Refunding
		Series A
	1,865,000	5.000%, 12/01/24 AGMC Insured	A1/AA/NR		2,120,524
		Broomfield, Colorado COP
	2,000,000	4.500%, 12/01/28	Aa3/NR/NR		2,233,100
		Colorado Educational & Cultural

6 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Lease (continued)
		Facilities Authority, Ave Maria School
		Project Refunding
$	1,000,000	4.850%, 12/01/25 AGC Insured	A3/AA/NR	$	1,036,110
		Colorado State BEST COP Series G
	3,000,000	4.250%, 03/15/23	Aa2/AA-/NR		3,338,370
		Colorado State BEST COP Series H
	3,490,000	4.000%, 03/15/26	Aa2/AA-/NR		3,873,062
		Colorado State Higher Education
		Capital Construction Lease
	1,690,000	5.000%, 11/01/26	Aa2/AA-/NR		2,173,543
		Denver, Colorado City and County
		COP (Botanical Gardens)
	2,015,000	5.250%, 12/01/22	Aa2/AA+/AA+		2,193,972
		Denver, Colorado City & County COP
		(Fire Station & Library Facilities)
	1,065,000	5.000%, 12/01/25	Aa1/AA+/AA+		1,357,651
		Douglas County, Colorado COP
		(Libraries)
	1,570,000	5.000%, 12/01/27	Aa2/NR/NR		1,905,650
		El Paso County, Colorado COP
		(Judicial Complex Project)
	1,085,000	4.500%, 12/01/26 AMBAC Insured
		(unrefunded portion)	NR/AA/NR		1,126,338
		Foothills Park and Recreation District,
		Colorado COP Refunding &
		Improvement
	1,380,000	5.000%, 12/01/26 AGMC Insured	NR/AA/NR		1,723,441
		Garfield County, Colorado COP
		Public Library District
	1,000,000	5.375%, 12/01/27	NR/A/NR		1,120,290
		Gypsum, Colorado COP
	1,050,000	5.000%, 12/01/28	NR/A+/NR		1,093,407
		Jefferson County, Colorado School
		District No. R-1 COP
	1,000,000	5.000%, 12/15/27	Aa3/A+/NR		1,245,080
		Pueblo, Colorado COP
		(Police Complex Project)
	2,170,000	5.500%, 08/15/22 AGC Insured	Aa3/AA/NR		2,337,437

7 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Lease (continued)
		Rangeview Library District Project,
		Colorado COP
$	2,515,000	5.000%, 12/15/27 AGMC Insured	Aa3/AA/NR	$	3,074,789
		Westminster, Colorado COP
	1,480,000	4.250%, 12/01/22 AGMC Insured	A2/AA/NR		1,654,122
		Total Lease			40,655,595

		Sales Tax (4.9%)
		Boulder, Colorado General Fund
		Capital Improvement Projects
	2,235,000	4.000%, 10/01/25	Aa1/AA+/NR		2,558,025
		Castle Rock, Colorado Sales & Use Tax
	1,015,000	4.000%, 06/01/25	Aa3/AA/NR		1,159,932
		Commerce City, Colorado Sales &
		Use Tax
	500,000	5.000%, 08/01/28 AGMC Insured	A2/AA/NR		628,075
	500,000	5.000%, 08/01/29 AGMC Insured	A2/AA/NR		624,550
	1,000,000	5.000%, 08/01/26 BAMAC Insured	A1/AA/NR		1,259,000
		Denver, Colorado City & County
		Dedicated Tax Refunding &
		Improvement, Series A
	1,350,000	5.000%, 08/01/26	Aa3/AA-/AA		1,747,156
	1,500,000	5.000%, 08/01/27	Aa3/AA-/AA		1,913,280
		Grand Junction, Colorado General Fund
	1,900,000	5.000%, 03/01/23	NR/AA/NR		2,235,996
		Park Meadows Business Implementation
		District, Colorado Shared Sales Tax
	1,500,000	5.300%, 12/01/27	NR/NR/NR*		1,544,715
		Pueblo, Colorado Urban Renewal
		Authority, Refunding & Improvement,
		Series B
	1,250,000	5.250%, 12/01/28	A2/A/NR		1,432,850
		Westminster, Colorado Economic
		Development Authority, Mandalay
		Gardens Urban Renewal Project
	1,090,000	4.000%, 12/01/22	NR/A+/NR		1,221,683
		Total Sales Tax			16,325,262

8 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Transportation (0.7%)
		Regional Transportation District,
		Colorado COP, Series A
$	2,000,000	5.000%, 06/01/26	Aa3/A/A	$	2,492,640

		Water & Sewer (9.8%)
		Arapahoe, Colorado Water & Wastewater
		Public Improvement District
	1,320,000	5.000%, 12/01/24	NR/AA-/NR		1,678,024
	1,020,000	5.000%, 12/01/25	NR/AA-/NR		1,286,812
		Aurora, Colorado Water Revenue
		Refunding, First Lien, Green Bonds
	1,000,000	5.000%, 08/01/28	NR/AA+/AA+		1,280,670
	1,000,000	5.000%, 08/01/29	NR/AA+/AA+		1,271,410
		Broomfield, Colorado Sewer and
		Waste Water
	1,975,000	4.000%, 12/01/21 AGMC Insured	A2/NR/NR		2,208,642
	1,550,000	5.000%, 12/01/24 AGMC Insured	A2/AA/NR		1,856,729
		Broomfield, Colorado Water
		Activity Enterprise
	3,385,000	5.000%, 12/01/21	A1/NR/NR		3,994,571
		Castle Rock, Colorado Water & Sewer
		Enterprise, Revenue Refunding
	1,000,000	5.000%, 12/01/28	Aa3/AA+/NR		1,284,000
		Colorado Water Resource & Power
		Development Authority
	925,000	5.000%, 09/01/25	Aaa/AAA/AAA		1,194,822
	1,000,000	5.000%, 09/01/27	Aaa/AAA/AAA		1,294,380
	1,855,000	5.000%, 09/01/17 NPFG Insured	A3/AA-/NR		1,860,417
		Denver, Colorado City and County
		Board Water Commissioners Master
		Resolution, Refunding, Series B
	1,000,000	4.000%, 12/15/22	Aaa/AAA/AAA		1,145,470
		Erie, Colorado Water Enterprise
		Revenue, Series A
	265,000	5.000%, 12/01/25 AGMC Insured
		(unrefunded portion)	A1/NR/NR		276,893
		Greeley, Colorado Water Revenue
	1,705,000	5.000%, 08/01/28	Aa2/AA+/NR		2,176,501

9 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Water & Sewer (continued)
		North Weld County, Colorado Water
		District Enterprise Revenue Refunding
$	1,465,000	4.000%, 11/01/22 AGMC Insured	NR/AA/NR	$	1,689,672
		Parker, Colorado Water & Sanitation
		District Water & Sewer
		Enterprise Refunding
	1,000,000	5.000%, 11/01/22 AGMC Insured	A2/AA/NR		1,200,040
		Thorton, Colorado Water Enterprise
		Revenue, Series 2013
	1,970,000	4.000%, 12/01/24	Aa2/AA/NR		2,308,781
		Westminster, Colorado Water &
		Wastewater Utility Enterprise
	1,160,000	5.000%, 12/01/28	NR/AAA/AA+		1,498,105
		Woodmoor, Colorado Water &
		Sanitation District #1 Enterprise
	2,570,000	4.500%, 12/01/26	NR/AA-/NR		2,944,218
		Total Water & Sewer			32,450,157

		Miscellaneous Revenue (0.9%)
		Colorado Educational & Cultural Facility
		Authority, Independent School Revenue
		Refunding, Kent Denver School Project
	1,000,000	5.000%, 10/01/30	NR/A/NR		1,101,930
		Colorado Educational & Cultural Facility
		Authority, Independent School Revenue
		Refunding, Vail Mountain School Project
	1,820,000	6.000%, 05/01/30	NR/BBB-/NR		2,008,152
		Total Miscellaneous Revenue			3,110,082
		Total Revenue Bonds			175,191,334

		Pre-Refunded Bonds (22.5%)††

		Pre-Refunded
		General Obligation Bonds (8.2%)

		Metropolitan District (2.3%)
		Fraser Valley, Colorado Metropolitan
		Recreational District
	1,875,000	5.000%, 12/01/25	NR/A/NR		1,964,494

10 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded Bonds†† (continued)	Rating Moody’s, S&P and Fitch	Value

		Metropolitan District (continued)
		Hyland Hills Metro Park & Recreation
		District, Colorado
$	875,000	4.375%, 12/15/26 ACA Insured	NR/NR/NR*	$	911,138
		North Metro Fire Rescue District,
		Colorado
	1,200,000	4.625%, 12/01/20 AMBAC Insured	NR/AA/NR		1,207,128
		Park Creek Metropolitan District,
		Colorado Revenue Refunding &
		Improvement - Senior Property
		Tax Support
	2,000,000	5.500%, 12/01/21 AGC Insured	NR/AA/BBB		2,282,200
		Stonegate Village Metropolitan District,
		Colorado Refunding & Improvement
	325,000	5.000%, 12/01/23 NPFG Insured	A3/AA-/NR		327,119
	175,000	5.000%, 12/01/23 NPFG Insured	A3/AA-/NR		176,141
	585,000	5.000%, 12/01/24 NPFG Insured	A3/AA-/NR		588,814
	315,000	5.000%, 12/01/24 NPFG Insured	A3/AA-/NR		317,054
		Total Metropolitan District			7,774,088

		School Districts (5.9%)
		Adams & Arapahoe Counties, Colorado
		Joint School District #28J
	2,500,000	5.500%, 12/01/23	Aa2/AA-/NR		2,744,350
		Adams & Weld Counties, Colorado
		School District #27J
	1,000,000	5.375%, 12/01/26 NPFG Insured	Aa2/AA-/NR		1,007,100
		Arapahoe County, Colorado School
		District #001 Englewood
	3,235,000	5.000%, 12/01/27	Aa2/NR/NR		3,863,819
		Boulder Larimer & Weld Counties,
		Colorado
	1,260,000	5.000%, 12/15/26 AGMC Insured	Aa2/AA/NR		1,270,269
	1,500,000	5.000%, 12/15/28	Aa2/AA/NR		1,631,265
		Denver, Colorado City & County
		School District No. 1
	3,000,000	5.250%, 12/01/27	Aa2/AA/NR		3,339,120
		El Paso County, Colorado School
		District #20
	1,500,000	4.500%, 12/15/25 AGMC Insured	Aa2/NR/NR		1,565,100

11 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		School Districts (continued)
		Gunnison Watershed, Colorado
		School District
$	1,025,000	5.250%, 12/01/26	Aa2/AA-/NR	$	1,119,731
		Jefferson County, Colorado School
		District #R-001
	3,000,000	5.250%, 12/15/25 AGMC Insured	Aa2/AA/NR		3,025,890
		Total School Districts			19,566,644
		Total Pre-Refunded General
		Obligation Bonds			27,340,732

		Pre-Refunded Revenue Bonds (14.3%)

		Electric (0.9%)
		Colorado Springs, Colorado Utilities
		Revenue, Refunding Series A
	1,705,000	4.750%, 11/15/27 .	NR/NR/NR*		1,900,359
		Colorado Springs, Colorado Utilities
		Revenue Refunding Series B
	865,000	5.250%, 11/15/23 .	NR/NR/NR*		942,547
		Total Electric			2,842,906

		Higher Education (3.8%)
		Adams State College, Colorado Auxiliary
		Facilities Improvement Series A
	1,000,000	5.200%, 05/15/27	Aa2/AA-/NR		1,110,160
		Colorado School of Mines Enterprise
		Refunding & Improvement
	1,455,000	5.000%, 12/01/24	Aa2/AA-/NR		1,581,716
		Colorado State Board of Governors
		University Enterprise System, Series A
	930,000	5.000%, 03/01/28 AGMC Insured	Aa3/AA/NR		982,861
		Mesa State College, Colorado Auxiliary
		Facilities Enterprise
	2,000,000	5.700%, 05/15/26	NR/AA-/NR		2,107,260
		University of Colorado Enterprise System
	2,000,000	5.000%, 06/01/27	Aa2/NR/AA+		2,213,000
		University of Colorado Enterprise
		System Series A
	2,000,000	4.750%, 06/01/27	Aa2/NR/AA+		2,338,320

12 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Higher Education (continued)
		Western State College, Colorado
		Institutional Enterprise, SHEIP, Series A
$	1,160,000	5.000%, 05/15/24	Aa2/AA-/NR	$	1,325,045
		Western State College, Colorado, SHEIP
	1,020,000	5.000%, 05/15/27	Aa2/AA-/NR		1,127,120
		Total Higher Education			12,785,482

		Hospital (1.7%)
		Colorado Health Facility Authority
		Hospital Revenue, Adventist
		Health/Sunbelt, Refunding
	2,500,000	5.125%, 11/15/29 .	Aa2/NR/NR		2,512,050
		Colorado Health Facility Authority
		Hospital Revenue, Catholic Health
	1,000,000	4.750%, 09/01/25 AGMC Insured	A2/AA/BBB+		1,060,450
		Colorado Health Facility Authority
		Hospital Revenue, NCMC, Inc. Project
	2,000,000	5.250%, 05/15/26 Series A AGM
		Insured	NR/AA/A+		2,222,900
		Total Hospital			5,795,400

		Lease (5.9%)
		Adams 12 Five Star Schools, Colorado
		COP
	1,770,000	4.625%, 12/01/24	Aa3/A+/NR		1,910,025
	500,000	5.000%, 12/01/25	Aa3/A+/NR		543,545
		Adams County, Colorado Corrections
		Facility COP, Series B
	1,600,000	5.000%, 12/01/26	Aa2/AA/NR		1,739,344
	1,200,000	5.125%, 12/01/27	Aa2/AA/NR		1,307,712
		Colorado Educational & Cultural Facilities
		Authority, Charter School - James,
		Refunding & Improvement
	3,000,000	5.000%, 08/01/27 AGC Insured	A3/AA/NR		3,102,270
		Colorado State Higher Education Capital
		Construction Lease
	3,000,000	5.250%, 11/01/23	Aa2/AA-/NR		3,267,300
		Douglas County, Colorado School District
		No. RE-1 Douglas & Elbert Counties COP
	3,075,000	5.000%, 01/15/29	Aa2/NR/NR		3,357,838

13 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Lease (continued)
		El Paso County, Colorado COP
		(Judicial Complex Project)
$	735,000	4.500%, 12/01/26 AMBAC Insured	NR/NR/NR*	$	765,429
		Rangeview Library District Project,
		Colorado COP
	2,210,000	5.000%, 12/15/26 AGC Insured	Aa3/AA/NR		2,405,917
	1,000,000	5.000%, 12/15/28 AGC Insured	Aa3/AA/NR		1,088,650
		Total Lease			19,488,030

		Sales Tax (1.4%)
		Denver, Colorado City & County
		Excise Tax Refunding Series A
	4,000,000	5.250%, 09/01/19 AGMC Insured	A1/AA/NR		4,497,880

		Water & Sewer (0.6%)
		Aurora, Colorado Water Improvement
		First Lien, Series A
	1,250,000	5.000%, 08/01/25 AMBAC Insured	Aa2/NR/AA+		1,292,612
		Erie, Colorado Water Enterprise
		Revenue, Series A
	735,000	5.000%, 12/01/25 AGMC Insured	A1/NR/NR		769,641
		Total Water & Sewer			2,062,253
		Total Pre-Refunded Revenue Bonds			47,471,951
		Total Pre-Refunded Bonds			74,812,683
		Total Investments
		(cost $305,156,225-note 4)	97.8%		325,161,459
		Other assets less liabilities	2.2		7,368,731
		Net Assets	100.0%	$	332,530,190

14 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

	Percent of
Portfolio Distribution by Quality Rating	Investments†
Aaa of Moody’s or AAA of S&P or Fitch		1.6	%
Pre-Refunded bonds††		23.0
Aa of Moody’s or AA of S&P or Fitch		58.9
A of Moody’s or S&P or Fitch		12.9
Baa of Moody’s or BBB of S&P		3.1
Not Rated*		0.5
		100.0	%

PORTFOLIO ABBREVIATIONS:

		ACA - American Capital Assurance Financial Guaranty Corp.
		AGC - Assured Guaranty Corp.
		AGMC - Assured Guaranty Municipal Corp.
		AMBAC - American Municipal Bond Assurance Corp.
		BAMAC - Build America Mutual Assurance Co.
		BEST - Building Excellent Schools Today
		COP - Certificates of Participation
		NCMC - Northern Colorado Medical Center
		NPFG - National Public Finance Guarantee
		NR - Not Rated
		SHEIP - State Higher Education Intercept Program

*		Any security not rated (“NR”) by any of the Nationally Recognized Statistical Rating Organizations (“NRSRO”) has been determined by the Investment Sub-Adviser to have sufficient quality to be ranked in the top four credit ratings if a credit rating were to be assigned by a NRSRO.

†		Where applicable, calculated using the highest rating of the three NRSRO.

††		Pre-refunded bonds are bonds secured by an escrow account, comprised of U.S. Government Obligations (unless otherwise noted), to retire the bonds at their earliest call date.

See accompanying notes to financial statements.

15 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

STATEMENT OF ASSETS AND LIABILITIES

SEPTEMBER 30, 2016 (unaudited)

ASSETS
Investments at value (cost $305,156,225)	$	325,161,459
Cash		4,955,801
Interest receivable		4,090,719
Receivable for Fund shares sold		2,171,608
Other assets		22,846
Total assets		336,402,433
LIABILITIES
Payable for Fund shares redeemed		2,211,622
Payable for investment securities purchased		1,289,427
Dividends payable		174,730
Management fee payable		140,199
Distribution and service fees payable		1,964
Accrued expenses payable		54,301
Total liabilities		3,872,243
NET ASSETS	$	332,530,190
Net Assets consist of:
Capital Stock - Authorized an unlimited number of shares,
par value $0.01 per share	$	306,716
Additional paid-in capital		313,660,734
Net unrealized appreciation on investments (note 4)		20,005,234
Accumulated net realized loss on investment		(1,546,181	)
Undistributed net investment income		103,687
	$	332,530,190
CLASS A
Net Assets	$	221,159,664
Capital shares outstanding		20,409,241
Net asset value and redemption price per share	$	10.84
Maximum offering price per share (100/96 of $10.84)	$	11.29
CLASS C
Net Assets	$	23,721,249
Capital shares outstanding		2,194,248
Net asset value and offering price per share	$	10.81
Redemption price per share (*a charge of 1% is imposed on the
redemption proceeds, or on the original price, whichever is
lower, if redeemed during the first 12 months after purchase)	$	10.81	*
CLASS Y
Net Assets	$	87,649,277
Capital shares outstanding		8,068,106
Net asset value, offering and redemption price per share	$	10.86

See accompanying notes to financial statements.

16 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

STATEMENT OF OPERATIONS

SIX MONTHS ENDED SEPTEMBER 30, 2016 (unaudited)

Investment Income:

Interest income				$	5,437,417


Expenses:

Management fees (note 3)	$	837,394
Distribution and service fees (note 3)		180,217
Transfer and shareholder servicing agent fees		63,874
Trustees’ fees and expenses (note 7)		52,530
Legal fees		46,316
Shareholders’ reports		11,224
Auditing and tax fees		10,910
Registration fees and dues		10,773
Insurance		6,944
Custodian fees		5,008
Chief compliance officer services (note 3)		4,492
Miscellaneous		20,837
Total expenses		1,250,519

Management fees waived (note 3)		(33,496	)
Net expenses					1,217,023
Net investment income					4,220,394

Realized and Unrealized Gain (Loss) on Investments:

Net realized gain (loss) from securities
transactions		2,877
Change in unrealized appreciation on
investments		172,683
Net realized and unrealized gain (loss) on
investments					175,560
Net change in net assets resulting from
				$	4,395,954

See accompanying notes to financial statements.

17 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

STATEMENTS OF CHANGES IN NET ASSETS

	Six Months Ended
	September 30, 2016			Year Ended
	(unaudited)			March 31, 2016
OPERATIONS:
Net investment income	$	4,220,394		$	8,405,799
Net realized gain (loss) from
securities transactions		2,877			339,917
Change in unrealized
appreciation on investments		172,683			554,701
Change in net assets from
operations		4,395,954			9,300,417

DISTRIBUTIONS TO SHAREHOLDERS (note 9):
Class A Shares:
Net investment income		(2,896,288	)		(5,981,983	)

Class C Shares:
Net investment income		(199,660	)		(503,546	)

Class Y Shares:
Net investment income		(1,100,133	)		(1,897,203	)
Change in net assets from
distributions		(4,196,081	)		(8,382,732	)

CAPITAL SHARE TRANSACTIONS (note 6):
Proceeds from shares sold		27,726,730			59,605,647
Reinvested dividends and
distributions		3,218,027			6,530,907
Cost of shares redeemed		(22,799,880	)		(32,403,313	)
Change in net assets from
capital share transactions		8,144,877			33,733,241
Change in net assets		8,344,750			34,650,926

NET ASSETS:
Beginning of period		324,185,440			289,534,514
End of period*	$	332,530,190		$	324,185,440
*Includes undistributed net investment income of:	$	103,687		$	79,374

See accompanying notes to financial statements.

18 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2016 (unaudited)

1. Organization

Aquila Tax-Free Fund of Colorado (the “Fund”), a series of Aquila Municipal Trust (prior to October 12, 2013, the Fund operated under the name Tax-Free Fund of Colorado), a non-diversified, open-end investment company, was organized in February, 1987 as a Massachusetts business trust and commenced operations on May 21, 1987. The Fund is authorized to issue an unlimited number of shares. Class A Shares are sold at net asset value plus a sales charge of varying size (depending upon a variety of factors) paid at the time of purchase and bear a distribution fee. Class C Shares are sold at net asset value with no sales charge payable at the time of purchase but with a level charge for service and distribution fees for six years thereafter. Class C Shares automatically convert to Class A Shares after six years. Class Y Shares are sold only through authorized financial institutions acting for investors in a fiduciary, advisory, agency, custodial or similar capacity, and are not offered directly to retail customers. Class Y Shares are sold at net asset value with no sales charge, no redemption fee, no contingent deferred sales charge (“CDSC”) and no distribution fee. Class I Shares are offered and sold only through financial intermediaries and are not offered directly to retail customers. Class I Shares are sold at net asset value with no sales charge and no redemption fee or CDSC, although a financial intermediary may charge a fee for effecting a purchase or other transaction on behalf of its customers. Class I Shares carry a distribution and a service fee. As of the report date, there were no Class I Shares outstanding. All classes of shares represent interests in the same portfolio of investments and are identical as to rights and privileges but differ with respect to the effect of sales charges, the distribution and/or service fees borne by each class, expenses specific to each class, voting rights on matters affecting a single class and the exchange privileges of each class.

2. Significant Accounting Policies

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.

19 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.

The following is a summary of the valuation inputs, representing 100% of the Fund’s investments, used to value the Fund’s net assets as of September 30, 2016:

Valuation Inputs	Investments in Securities
Level 1 – Quoted Prices	$	—
Level 2 – Other Significant Observable
Inputs — Municipal Bonds*		325,161,459
Level 3 – Significant Unobservable Inputs		—
Total	$	325,161,459

* See schedule of investments for a detailed listing of securities.

c)	Subsequent events: In preparing these financial statements, the Fund has evaluated events and transactions for potential recognition or disclosure through the date these financial statements were issued.

Multiple class allocations: All income, expenses (other than class-specific expenses), and realized and unrealized gains or losses are allocated daily to each class of shares based on the relative net assets of each class.Class-specific expenses,which include distribution and service fees and any other items that are specifically attributed to a particular class, are also charged directly to such class on a daily basis.

20 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Reclassification of capital accounts: Accounting principles generally accepted in the United States of America require that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per share. For the year ended March 31, 2016, there were no items identified that have been reclassified among components of net assets.

i)	The Fund is an investment company and accordingly follows the investment company accounting reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 “Financial Services-Investment Companies”.

3. Fees and Related Party Transactions

a) Management Arrangements:

Aquila Investment Management LLC (the “Manager”), a wholly-owned subsidiary of Aquila Management Corporation, the Fund’s founder and sponsor, serves as the Manager for the Fund under an Advisory and Administration Agreement with the Fund. The portfolio management of the Fund has been delegated to a Sub-Adviser as described below. Under the Advisory and Administration Agreement, the Manager provides all administrative services to the Fund, other than those relating to the day-to-day portfolio management. The Manager’s services include providing the office of the Fund and all related services as well as overseeing the activities of the Sub-Adviser and managing relationships with all the various support organizations to the Fund such as the shareholder servicing agent, custodian, legal counsel, auditors and distributor and additionally maintaining the Fund’s accounting books and records. For its services, the Manager is entitled to receive a fee which is payable monthly and computed as of the close of business each day at the annual rate of 0.50% of net assets of the Fund. The Manager has contractually agreed to waive fees through September 30, 2017 to the extent necessary in order to pass savings through to the shareholders with respect to the Sub-Advisory Agreement such that its fees are as follows: the annual rate shall be equivalent to 0.48% of net assets of the Fund up to $400 million; 0.46% of the Fund’s net assets above that amount to $1 billion and 0.44% of the Fund’s net assets above $1 billion. For the six months ended September 30, 2016, the Fund incurred management fees of $837,394 of which $33,496 was waived under the contractual fee waiver.

Kirkpatrick Pettis Capital Management (the “Sub-Adviser”) serves as the Investment Sub-Adviser for the Fund under a Sub-Advisory Agreement between the Manager and the Sub-Adviser. Under this agreement, the Sub-Adviser continuously provides, subject to oversight of the Manager and the Board of Trustees of the Fund, the investment program of the Fund and the composition of its portfolio, arranges for the purchases and sales of portfolio securities, and provides for daily pricing of the Fund’s portfolio. For its services, the Sub-Adviser is entitled to receive a fee from the Manager which is payable monthly and computed as of the close of business each day at the annual rate of 0.20%. The Sub-Adviser has contractually agreed to waive its fee through September 30, 2017 such that its annual rate of fees is at 0.18% of net assets of the Fund up to $400 million; 0.16% of net assets above $400 million up to $1 billion; and 0.14% of net assets above $1 billion.

21 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Specific details as to the nature and extent of the services provided by the Manager and the Sub-Adviser are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

b) Distribution and Service Fees:

The Fund has adopted a Distribution Plan (the “Plan”) pursuant to Rule 12b-1 (the “Rule”) under the Investment Company Act of 1940. Under one part of the Plan, with respect to Class A Shares, the Fund is authorized to make distribution fee payments to broker-dealers or others (“Qualified Recipients”) selected by Aquila Distributors LLC (the “Distributor”), including, but not limited to, any principal underwriter of the Fund, with which the Distributor has entered into written agreements contemplated by the Rule and which have rendered assistance in the distribution and/or retention of the Fund’s shares or servicing of shareholder accounts. While the Board of Trustees and shareholders approved an amendment to the Fund’s Distribution Plan applicable to Class A Shares which permits the Fund to make distribution fee payments at the rate of up to 0.15% on the entire net assets represented by Class A Shares, the Fund currently makes payment of this distribution fee at the annual rate of 0.05%. For the six months ended September 30, 2016, distribution fees on Class A Shares amounted to $56,446 of which the Distributor retained $2,289.

Under another part of the Plan, the Fund is authorized to make payments with respect to Class C Shares to Qualified Recipients which have rendered assistance in the distribution and/or retention of the Fund’s Class C shares or servicing of shareholder accounts. These payments are made at the annual rate of 0.75% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, amounted to $92,828. In addition, under a Shareholder Services Plan, the Fund is authorized to make service fee payments with respect to Class C Shares to Qualified Recipients for providing personal services and/or maintenance of shareholder accounts. These payments are made at the annual rate of 0.25% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, amounted to $30,943. The total of these payments with respect to Class C Shares amounted to $123,771 of which the Distributor retained $29,789.

22 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Specific details about the Plans are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

Under a Distribution Agreement, the Distributor serves as the exclusive distributor of the Fund’s shares. Through agreements between the Distributor and various brokerage and advisory firms (“intermediaries”), the Fund’s shares are sold primarily through the facilities of these intermediaries having offices within Colorado, with the bulk of any sales commissions inuring to such intermediaries. For the six months ended September 30, 2016, total commissions on sales of Class A Shares amounted to $141,871 of which the Distributor received $29,176.

4. Purchases and Sales of Securities

During the six months ended September 30, 2016, purchases of securities and proceeds from the sales of securities aggregated $26,764,391 and $11,376,961, respectively.

At September 30, 2016, the aggregate tax cost for all securities was $305,140,836. At September 30, 2016, the aggregate gross unrealized appreciation for all securities in which there is an excess of value over tax cost amounted to $20,076,217 and aggregate gross unrealized depreciation for all securities in which there is an excess of tax cost over value amounted to $55,594 for a net unrealized appreciation of $20,020,623.

5. Portfolio Orientation

Since the Fund invests principally and may invest entirely in double tax-free municipal obligations of issuers within Colorado, it is subject to possible risks associated with economic, political, or legal developments or industrial or regional matters specifically affecting Colorado and whatever effects these may have upon Colorado issuers’ ability to meet their obligations.

23 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

6. Capital Share Transactions

Transactions in Capital Shares of the Fund were as follows:

	Six Months Ended
	September 30, 2016						Year Ended
	(unaudited)						March 31, 2016
	Shares			Amount			Shares			Amount
Class A Shares:
Proceeds from shares sold		946,838		$	10,300,181			2,467,976		$	26,498,182
Reinvested dividends and
distributions		216,530			2,351,914			456,384			4,900,410
Cost of shares redeemed		(1,096,771	)		(11,918,202	)		(1,251,198	)		(13,435,529	)
Net change		66,597			733,893			1,673,162			17,963,063
Class C Shares:
Proceeds from shares sold		253,387			2,750,253			431,842			4,626,003
Reinvested dividends and
distributions		15,701			170,178			40,239			430,976
Cost of shares redeemed		(335,365	)		(3,642,140	)		(653,770	)		(6,995,823	)
Net change		66,277	)		(721,709	)		(181,689	)		(1,938,844	)
Class Y Shares:
Proceeds from shares sold		1,346,867			14,676,296			2,642,307			28,481,462
Reinvested dividends and
distributions		63,816			695,935			111,340			1,199,521
Cost of shares redeemed		(664,183	)		(7,239,538	)		(1,112,765	)		(11,971,961	)
Net change		746,500			8,132,693			1,640,882			17,709,022
Total transactions in Fund
shares		746,820		$	8,144,877			3,132,355		$	33,733,241

7. Trustees’ Fees and Expenses

For the six months ended September 30, 2016, there were 9 Trustees, one of whom is affiliated with the Manager and is not paid any fees. The total amount of Trustees’ service fees (for carrying out their responsibilities) and attendance fees paid during the six months ended September 30, 2016 was $46,130. Attendance fees are paid to those in attendance at regularly scheduled quarterly Board Meetings and meetings of the independent Trustees held prior to each quarterly Board Meeting, as well as additional meetings (such as Audit, Nominating, Shareholder and special meetings). Trustees are reimbursed for their expenses such as travel, accommodations and meals incurred in connection with attendance at Board Meetings and the Annual Meeting of Shareholders. For the six months ended September 30, 2016, such meeting-related expenses amounted to $6,400.

24 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

8. Securities Traded on a When-Issued Basis

9. Income Tax Information and Distributions

The Fund intends to maintain, to the maximum extent possible, the tax-exempt status of interest payments received from portfolio municipal securities in order to allow dividends paid to shareholders from net investment income to be exempt from regular Federal and State of Colorado income taxes. Due to the distribution levels maintained by the Fund and the differences between financial statement reporting and Federal income tax reporting requirements, distributions made by the Fund may not be the same as the Fund’s net investment income, and/or net realized securities gains. As a result of the passage of the Regulated Investment Company Act of 2010 (the “Act”), losses incurred in this fiscal year and beyond retain their character as short-term or long-term, have no expiration date and are utilized before capital losses incurred prior to the enactment of the Act. At March 31, 2016, the Fund had capital loss carry forwards of $1,549,058 of which $55,212 expires in 2017 and $1,493,846 has no expiration and retains its character of short-term. This carryover is available to offset future net realized gains on securities transactions to the extent provided for in the Internal Revenue Code.

25 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

The tax character of distributions was as follows:

	Year		Year
	Ended		Ended
	March 31, 2016		March 31, 2015
Net tax-exempt income	$	8,382,732	$	8,416,080
Ordinary income		–		–
	$	8,382,732	$	8,416,080

As of March 31, 2016 the components of distributable earnings on a tax basis were as follows:

Undistributed tax-exempt income	$	113,323
Unrealized appreciation		19,912,209
Accumulated net loss on investments		(1,549,058	)
Other temporary differences		(113,607	)
	$	18,362,867

26 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

FINANCIAL HIGHLIGHTS

For a share outstanding throughout each period

	Class A
	Six Months Ended			Year			Year			Year			Three Months			Year Ended
	9/30/16			Ended			Ended			Ended			Ended			December 31,
	(unaudited)			3/31/16			3/31/15			3/31/14			3/31/13†			2012			2011
Net asset value, beginning of period	$	10.83		$	10.80		$	10.45		$	10.80		$	10.89		$	10.63		$	10.14
Income (loss) from investment operations:
Net investment income(1)		0.14			0.31			0.32			0.32			0.08			0.35			0.39
Net gain (loss) on securities (both
realized and unrealized)		0.01			0.03			0.35			(0.35	)		(0.09	)		0.26			0.49
Total from investment operations		0.15			0.34			0.67			(0.03	)		(0.01	)		0.61			0.88
Less distributions (note 9):
Dividends from net investment income		(0.14	)		(0.31	)		(0.32	)		(0.32	)		(0.08	)		(0.35	)		(0.39	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.14	)		(0.31	)		(0.32	)		(0.32	)		(0.08	)		(0.35	)		(0.39	)
Net asset value, end of period	$	10.84		$	10.83		$	10.80		$	10.45		$	10.80		$	10.89		$	10.63
Total return (not reflecting sales charge)		1.39	%(2)		3.20	%		6.52	%		(0.20	)%		(0.10	)%(2)		5.85	%		8.81	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	221		$	220		$	202		$	209		$	233		$	240		$	221
Ratio of expenses to average net assets		0.68	%(3)		0.67	%		0.73	%		0.74	%(4)		0.70	%(3)		0.71	%		0.75	%
Ratio of net investment income to
average net assets		2.61	%(3)		2.89	%		3.04	%		3.09	%(4)		2.98	%(3)		3.27	%		3.75	%
Portfolio turnover rate		4	%(2)		10	%		8	%		4	%		2	%(2)		15	%		13	%

Expense and net investment income ratios without the effect of the contractual expense cap were (note 3):

Ratio of expenses to average net assets		0.70	%(3)		0.69	%		0.75	%		0.76	%(4)		0.72	%(3)		0.73	%		–
Ratio of net investment income to
average net assets		2.59	%(3)		2.87	%		3.02	%		3.07	%(4)		2.96	%(3)		3.26	%		–

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.72% and 3.11%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from December 31 to March 31. The information presented is for the period January 1, 2013 to March 31, 2013.

See accompanying notes to financial statements.

27 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class C
	Six Months												Three
	Ended			Year			Year			Year			Months			Year Ended
	9/30/16			Ended			Ended			Ended			Ended			December 31,
	(unaudited)			3/31/16			3/31/15			3/31/14			3/31/13†			2012			2011
Net asset value, beginning of period	$	10.80		$	10.78		$	10.43		$	10.78		$	10.87		$	10.61		$	10.12
Income (loss) from investment operations:
Net investment income(1)		0.09			0.21			0.22			0.22			0.05			0.25			0.29
Net gain (loss) on securities (both
realized and unrealized)		0.01			0.02			0.35			(0.35	)		(0.09	)		0.26			0.49
Total from investment operations		0.10			0.23			0.57			(0.13	)		(0.04	)		0.51			0.78
Less distributions (note 9):
Dividends from net investment income		(0.09	)		(0.21	)		(0.22	)		(0.22	)		(0.05	)		(0.25	)		(0.29	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.09	)		(0.21	)		(0.22	)		(0.22	)		(0.05	)		(0.25	)		(0.29	)
Net asset value, end of period	$	10.81		$	10.80		$	10.78		$	10.43		$	10.78		$	10.87		$	10.61
Total return (not reflecting CDSC)		0.91	%(2)		2.18	%		5.52	%		(1.15	)%		(0.33	)%(2)		4.86	%		7.80	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	24		$	24		$	26		$	28		$	37		$	38		$	29
Ratio of expenses to average net assets		1.64	%(3)		1.62	%		1.68	%		1.68	%(4)		1.65	%(3)		1.66	%		1.70	%
Ratio of net investment income to
average net assets		1.64	%(3)		1.94	%		2.09	%		2.14	%(4)		2.03	%(3)		2.31	%		2.79	%
Portfolio turnover rate		4	%(2)		10	%		8	%		4	%		2	%(2)		15	%		13	%

Expense and net investment income ratios without the effect of the contractual expense cap were (note 3):

Ratio of expenses to average net assets		1.66	%(3)		1.64	%		1.70	%		1.70	%(4)		1.67	%(3)		1.68	%		–
Ratio of net investment income to
average net assets		1.62	%(3)		1.92	%		2.07	%		2.12	%(4)		2.01	%(3)		2.30	%		–

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 1.67% and 2.16%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from December 31 to March 31. The information presented is for the period January 1, 2013 to March 31, 2013.

See accompanying notes to financial statements.

28 | Aquila Tax-Free Fund of Colorado

AQUILA TAX-FREE FUND OF COLORADO

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class Y
	Six Months												Three
	Ended			Year			Year			Year			Months			Year Ended
	9/30/16			Ended			Ended			Ended			Ended			December 31,
	(unaudited)			3/31/16			3/31/15			3/31/14			3/31/13†			2012			2011
Net asset value, beginning of period	$	10.86		$	10.83		$	10.47		$	10.83		$	10.92		$	10.66		$	10.16
Income (loss) from investment operations:
Net investment income(1)		0.15			0.32			0.33			0.33			0.08			0.36			0.39
Net gain (loss) on securities (both
realized and unrealized)		(0.01	)		0.02			0.36			(0.36	)		(0.09	)		0.26			0.50
Total from investment operations		0.14			0.34			0.69			(0.03	)		(0.01	)		0.62			0.89
Less distributions (note 10):
Dividends from net investment income		(0.14	)		(0.31	)		(0.33	)		(0.33	)		(0.08	)		(0.36	)		(0.39	)
Distributions from capital gains		–			–			–			–			–			–			–
Total distributions		(0.14	)		(0.31	)		(0.33	)		(0.33	)		(0.08	)		(0.36	)		(0.39	)
Net asset value, end of period	$	10.86		$	10.86		$	10.83		$	10.47		$	10.83		$	10.92		$	10.66
Total return		1.32	%(2)		3.24	%		6.66	%		(0.24	)%		(0.08	)%(2)		5.89	%		8.96	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	88		$	79		$	62		$	45		$	57		$	50		$	37
Ratio of expenses to average net assets		0.63	%(3)		0.62	%		0.68	%		0.68	%(4)		0.65	%(3)		0.66	%		0.70	%
Ratio of net investment income to
average net assets		2.66	%(3)		2.94	%		3.08	%		3.14	%(4)		3.03	%(3)		3.31	%		3.80	%
Portfolio turnover rate		4	%(2)		10	%		8	%		4	%		2	%(2)		15	%		13	%

Expense and net investment income ratios without the effect of the contractual expense cap were (note 3):

Ratio of expenses to average net assets		0.65	%(3)		0.64	%		0.70	%		0.70	%(4)		0.67	%(3)		0.68	%		–
Ratio of net investment income to
average net assets		2.64	%(3)		2.92	%		3.06	%		3.12	%(4)		3.01	%(3)		3.30	%		–

Expense ratios after giving effect to the contractual expense cap and expense offset for uninvested cash balances were:

Ratio of expenses to average net assets		0.63	%(3)		0.62	%		0.68	%		0.68	%(4)		0.65	%(3)		0.66	%		0.70	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.66% and 3.16%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from December 31 to March 31. The information presented is for the period January 1, 2013 to March 31, 2013.

See accompanying notes to financial statements.

29 | Aquila Tax-Free Fund of Colorado

Analysis of Expenses (unaudited)

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including front-end sales charges with respect to Class A shares or contingent deferred sales charges (“CDSC”) with respect to Class C shares; and (2) ongoing costs, including management fees; distribution (“12b-1”) and/or service fees; and other Fund expenses. The table below is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The table below is based on an investment of $1,000 invested on April 1, 2016 and held for the six months ended September 30, 2016.

Actual Expenses

Six months ended September 30, 2016

	Actual
	Total Return	Beginning	Ending	Expenses
	Without	Account	Account	Paid During
	Sales Charges(1)	Value	Value	the Period(2)
Class A	1.39%	$1,000.00	$1,013.90	$3.43
Class C	0.91%	$1,000.00	$1,009.10	$8.26
Class Y	1.32%	$1,000.00	$1,013.20	$3.18

(1)

(2)	Expenses are equal to the annualized expense ratio of 0.68%, 1.64% and 0.63% for the Fund’s Class A, C and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

30 | Aquila Tax-Free Fund of Colorado

Analysis of Expenses (unaudited) (continued)

Hypothetical Example for Comparison Purposes

Six months ended September 30, 2016

	Hypothetical
	Annualized	Beginning	Ending	Expenses
	Total	Account	Account	Paid During
	Return	Value	Value	the Period(1)
Class A	5.00%	$1,000.00	$1,021.66	$3.45
Class C	5.00%	$1,000.00	$1,016.85	$8.29
Class Y	5.00%	$1,000.00	$1,021.91	$3.19

(1)	Expenses are equal to the annualized expense ratio of 0.68%, 1.64% and 0.63% for the Trust’s Class A, C and Y shares, respectively, multiplied by the average by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

31 | Aquila Tax-Free Fund of Colorado

Information Available (unaudited)

The Fund additionally files a complete list of its portfolio holdings with the SEC for the first and third quarter of each fiscal year on Form N-Q. Forms N-Q are available free of charge on the SEC website at www.sec.gov. You may also review or, for a fee, copy the forms at the SEC’s Public Reference Room in Washington, D.C. or by calling 1-800-SEC-0330.

Proxy Voting Record (unaudited)

Federal Tax Status of Distributions (unaudited)

This information is presented in order to comply with a requirement of the Internal Revenue Code. No action on the part of shareholders is required.

For the fiscal year ended March 31, 2016, $8,382,732 of dividends paid by Aquila Tax-Free Fund of Colorado, constituting 100% of total dividends paid, were exempt-interest dividends.

Prior to February 15, 2017, shareholders will be mailed the appropriate tax form(s) which will contain information on the status of distributions paid for the 2016 calendar year.

32 | Aquila Tax-Free Fund of Colorado

Additional Information (unaudited)

Renewal of the Advisory and Administration Agreement and the Sub-Advisory Agreement

Aquila Investment Management LLC (the “Manager”) serves as the investment adviser to the Fund pursuant to an Advisory and Administration Agreement (the “Advisory Agreement”). The Manager has retained Davidson Fixed Income Management, Inc., doing business as Kirkpatrick Pettis Capital Management (the “Sub-Adviser”), to serve as the sub-adviser to the Fund pursuant to a Sub-Advisory Agreement between the Manager and the Sub-Adviser (the “Sub-Advisory Agreement”). In order for the Manager and the Sub-Adviser to continue to serve in their respective roles, the Trustees of the Fund must determine annually whether to renew the Advisory Agreement and the Sub-Advisory Agreement for the Fund.

The nature, extent, and quality of the services provided by the Manager and the Sub-Adviser

33 | Aquila Tax-Free Fund of Colorado

The Manager has retained the Sub-Adviser to provide investment management of the Fund’s portfolio. The Trustees reviewed the Sub-Adviser’s investment approach for the Fund. The Trustees considered the personnel of the Sub-Adviser who provide investment management services to the Fund. The Trustees noted the extensive experience of the Sub-Adviser’s portfolio manager, Mr. Christopher Johns. They considered that Mr. Johns is based in Denver, Colorado and that he has a comprehensive understanding regarding the economy of the State of Colorado and the securities in which the Fund invests, including those securities with less than the highest ratings from the rating agencies. The Trustees also noted that the Fund did not own any Puerto Rico municipal bonds during the review period.

The Trustees considered that the Manager supervised and monitored the performance of the Sub-Adviser. The Trustees also considered that the Manager and the Sub-Adviser had provided all advisory services to the Fund that the Trustees deemed necessary or appropriate, including the specific services that the Trustees have determined are required for the Fund, given that it seeks to provide shareholders with as high a level of current income exempt from Colorado state and regular Federal income taxes as is consistent with preservation of capital.

The investment performance of the Fund

The Trustees reviewed the Fund’s performance (Class A Shares) and compared its performance to the performance of:

•

the funds in the Fund’s peer group (the “Peer Group”), as selected by the independent consultant (four Colorado intermediate and long municipal bond funds, as classified by Morningstar, that charge a front-end sales charge);

•

the Fund’s benchmark index, the Barclays Capital Quality Intermediate Municipal Bond Index.

34 | Aquila Tax-Free Fund of Colorado

The Trustees discussed the Fund’s performance record with the Manager and the Sub-Adviser and considered the Manager’s and Sub-Adviser’s view that the Fund’s performance, as compared to its peer group, was explained in part by the Fund’s somewhat higher-quality portfolio and lower duration. The Trustees noted that, unlike the Fund’s returns, the performance of the benchmark index did not reflect any fees, expenses or sales charges.

Advisory and Sub-Advisory Fees and Fund Expenses

•

the funds in the Peer Group (as defined above); and

•

The Trustees considered that the Fund’s contractual advisory fee was lower than the average and median contractual advisory fee of the funds in the Peer Group (at the Fund’s current asset level). They also considered that the Fund’s contractual advisory fee was lower than the asset-weighted average contractual advisory fee of the funds in the Product Category for Expenses at the Fund’s current asset level and up to $5 billion in assets.

35 | Aquila Tax-Free Fund of Colorado

The Trustees noted that the Fund’s actual management fee (after giving effect to the fee waiver) was higher than the average actual management fee of the funds in both the Product Category for Expenses and the Peer Group (after giving effect to fee waivers in effect for those funds). They noted, however that the Fund’s actual expenses (for Class A shares), after giving effect to fee waivers and expense reimbursements) were lower than the average actual expenses of the funds in both the Product Category for Expenses and the Peer Group (after giving effect to fee waivers and expense reimbursements in effect for those funds).

The Trustees concluded that the advisory and sub-advisory fees were reasonable in relation to the nature and quality of the services provided to the Fund by the Manager and the Sub-Adviser.

Profitability

The Trustees considered the information provided by the Manager regarding the profitability of the Manager with respect to the advisory services provided by the Manager to the Fund, including the methodology used by the Manager in allocating certain of its costs to the management of the Fund. The Trustees also considered information regarding the profitability of the Manager provided to the Trustees by the independent consultant. The Trustees concluded that profitability to the Manager with respect to advisory services provided to the Fund did not argue against approval of the fees to be paid under the Advisory Agreement.

36 | Aquila Tax-Free Fund of Colorado

The extent to which economies of scale would be realized as the Fund grows

The Trustees considered the extent to which the Manager and the Sub-Adviser may realize economies of scale or other efficiencies in managing the Fund. They noted that the Sub-Adviser has agreed to waive a portion of its sub-advisory fees and to include breakpoints in its fee schedule based on the size of the Fund. In addition, it was noted that the Manager had contractually agreed to waive its fees to the extent necessary in order to pass the benefits of the breakpoints in the sub-advisory fee schedule and the Sub-Adviser’s fee waiver under the Sub-Advisory Agreement to the shareholders of the Fund. Accordingly, the Trustees concluded that economies of scale, if any, were being appropriately shared with the Fund.

Benefits derived or to be derived by the Manager and the Sub-Adviser and their affiliates from their relationships with the Fund

37 | Aquila Tax-Free Fund of Colorado

(THIS PAGE INTENTIONALLY LEFT BLANK)

Founders

Lacy B. Herrmann (1929-2012)

Aquila Management Corporation, Sponsor

Manager

AQUILA INVESTMENT MANAGEMENT LLC

120 West 45th Street, Suite 3600

New York, New York 10036

Investment Sub-Adviser

KIRKPATRICK PETTIS CAPITAL MANAGEMENT

1550 Market Street, Suite 300

Denver, Colorado 80202

Board of Trustees

John C. Lucking, Chair

Diana P. Herrmann, Vice Chair

Ernest Calderón

Thomas A. Christopher

Gary C. Cornia

Grady Gammage, Jr.

Glenn P. O’Flaherty

James R. Ramsey

Laureen L. White

Officers

Diana P. Herrmann, President

Charles E. Childs, III, Executive Vice President and Secretary

Marie E. Aro, Senior Vice President

Paul G. O’Brien, Senior Vice President

Craig T. DiRuzzo, Vice President

Randall S. Fillmore, Chief Compliance Officer

Joseph P. DiMaggio, Chief Financial Officer

and Treasurer

Distributor

AQUILA DISTRIBUTORS LLC

120 West 45th Street, Suite 3600

New York, New York 10036

Transfer and Shareholder Servicing Agent

BNY MELLON INVESTMENT SERVICING (US) INC.

4400 Computer Drive

Westborough, Massachusetts 01581

Custodian

THE BANK OF NEW YORK MELLON

225 Liberty Street

New York, New York 10286

Further information is contained in the Prospectus,

which must precede or accompany this report.

Semi-Annual

Report

September 30, 2016

Please plan to join us for your 2017 shareholder meeting.

Details will be available on our website as the date approaches:

www.aquilafunds.com

or through your financial professional.

Aquila Tax-Free

Fund For Utah

“The Role of Trustees”

Serving Utah investors since 1992

November, 2016

Dear Fellow Shareholder:

Under applicable state law, Trustees are charged, as their primary responsibility, with safeguarding the interests of shareholders. As such, your Trustees seek to act in your best interests, putting your interests ahead of their own interests and those of anyone else, in overseeing the policies and procedures of Aquila Tax-Free Fund For Utah (your “Fund”), as well as the services provided by your Fund’s key service providers.

The 1940 Act requires your Board of Trustees to review certain of your Fund’s contracts on at least an annual basis, at which time, the majority of your Trustees, including a majority of the independentTrustees, must be present in person. Moreover, in their review of the contract with your Fund’s adviser, the Trustees seek to consider certain factors and their conclusions are disclosed to you in your Fund’s next annual or semi-annual report (as is the case with this semi-annual report). Your Trustees’ other key responsibilities include oversight of your Fund’s compliance policies and procedures, valuation and risk management.

Selection and nomination of independent Trustees is by the existing independent Trustees. As detailed in the Nominating Committee Charter which is available on your Fund’s website (www.aquilafunds.com), your Board of Trustees seeks to develop and maintain a board of high quality, independence and integrity to best serve your interests. The Trustees associated with the Aquila Group of Funds are additionally selected on the basis of being accomplished individuals of diverse backgrounds from various parts of the United States, including Utah. Through this diversity, we strive to provide your Fund with a broad breadth and balance of knowledge and experience. Biographical and other information on your Board of Trustees is available on our website and, by law, is included in your Fund’s annual report and Statement of Additional Information.

NOT A PART OF THE SEMI-ANNUAL REPORT

Although, not required, Trustees in the Aquila Group of Funds self-impose some additional criteria.

•

In addition to overseeing your Fund, all Trustees are also fellow shareholders. While Trustees, like any investor, must consider, among other things, their own personal investment objectives (including tax benefits afforded the investment by their state of residence) when deciding upon the size of their investment in Aquila Tax-Free Fund For Utah, we believe it is important that each Trustee has “some skin the game.”

•

Consideration is given to including local residents as Trustees. In this way, the Fund can benefit from their hands-on insight and knowledge of their State.

In short, your Board of Trustees are your “watchdogs,” looking over operations of Aquila Tax-Free Fund For Utah.

It has been our experience that those who have undertaken to serve as Trustees diligently devote their energies, talents and experience to furthering the interests of you, our shareholders.

Sincerely,

Diana P. Herrmann, Vice Chair and President

NOT A PART OF THE SEMI-ANNUAL REPORT

Mutual fund investing involves risk and loss of principal is possible.

Investments in the Fund are subject to possible loss due to the financial failure of the issuers of underlying securities and their inability to meet their debt obligations.

A portion of income may be subject to local, state, Federal and/or alternative minimum tax. Capital gains, if any, are subject to capital gains tax.

These risks may result in share price volatility.

Past performance is no guarantee of future results, and there is no guarantee that any market forecasts discussed will be realized.

NOT A PART OF THE SEMI-ANNUAL REPORT

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (20.8%)	Rating Moody’s, S&P and Fitch	Value

		City & County (6.7%)
		Bexar County, Texas
$	2,000,000	4.000%, 06/15/31	Aaa/AAA/AAA	$	2,243,040
		Bexar County, Texas Certificates of
		Obligation
	1,000,000	4.000%, 06/15/34	Aaa/AAA/AAA		1,124,730
		Carson City, Nevada
	1,000,000	5.000%, 05/01/28	A1/AA-/NR		1,219,390
		Clark County, Nevada, Refunding
	2,280,000	5.000%, 12/01/29 Series A	Aa1/AA/NR		2,548,219
	1,000,000	5.000%, 07/01/23 Series B	Aa1/AA/NR		1,126,470
	2,000,000	5.000%, 11/01/28 AGMC/AMBAC
		Insured	Aa1/AA/AA		2,006,160
	1,000,000	4.000%, 11/01/32 Series 2016B	Aa1/AA/NR		1,142,390
		Fort Bend County, Texas
	1,000,000	4.500%, 03/01/35 Series B	Aa1/NR/AA+		1,160,320
		Henderson, Nevada Refunding
		Various Purpose
	1,000,000	5.000%, 06/01/33 Series B	Aa2/AA+/NR		1,195,000
	750,000	5.000%, 06/01/30 Series 2014	Aa2/AA+/NR		908,955
	750,000	5.000%, 06/01/35 Series 2014	Aa2/AA+/NR		894,862
		Houston, Texas Public Improvement
	1,000,000	5.000%, 03/01/29	Aa3/AA/NR		1,088,590
	1,000,000	5.000%, 03/01/33	Aa3/AA/NR		1,216,780
		Miami Gardens, Florida
	1,000,000	5.000%, 07/01/29	A1/A+/NR		1,202,160
		Orem, Utah Refunding
	690,000	0.250%, 12/01/16	NR/AA/AA+		689,193
	900,000	0.250%, 12/01/17	NR/AA/AA+		894,114
		Reedy Creek, Florida Improvement
		District
	1,000,000	5.250%, 06/01/29 Series A	Aa3/AA-/AA-		1,233,810
		Reno, Nevada, Capital Improvement
		Refunding
	1,000,000	5.000%, 06/01/28	A1/A-/NR		1,181,270
		San Angelo, Texas Certificates of
		Obligation
	2,765,000	5.000%, 02/15/30 Series A	Aa2/AA/AA+		3,111,482

1 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		City & County (continued)
		San Antonio, Texas Refunding &
		General Improvement
$	1,000,000	4.000%, 02/01/34	Aaa/AAA/AAA	$	1,123,410
		Washoe County, Nevada Refunding
		Reno Sparks Convention
	2,000,000	5.000%, 07/01/28	Aa2/AA/NR		2,328,980
		Total City and County			29,639,325

		Hospital (0.7%)
		Bexar County, Texas Hospital
		District Limited Tax
	1,855,000	4.000%, 02/15/34	Aa1/AA+/AA+		2,058,104
		King County, Washington Public
		Hospital District No. 002,
		Refunding, Evergreen Healthcare
	1,000,000	5.250%, 12/01/28	Aa3/A+/NR		1,154,880
		Total Hospital			3,212,984

		Local Public Property (0.6%)
		Houston, Texas Public Improvement
	1,000,000	5.000%, 03/01/35 Series A	Aa3/AA/NR		1,208,360
		Missouri City, Texas Refunding
	1,235,000	4.000%, 06/15/32	Aa2/NR/NR		1,366,651
		Total Local Public Property			2,575,011

		Public Schools (10.2%)
		Aldine, Texas Independent School
		District
	1,000,000	4.000%, 02/15/37 PSF Guaranteed	Aaa/AAA/NR		1,097,480
		Austin, Texas Community College
		District Limited Tax
	1,000,000	4.000%, 08/01/33	Aa1/AA+/AA+		1,131,760
		Chisum, Texas Independent School
		District
	1,025,000	4.000%, 08/15/34 PSF Guaranteed	Aaa/NR/NR		1,144,361
		Clark County, Nevada School District
		Limited Tax
	2,000,000	4.000%, 06/15/30 Series D	A1/AA-/NR		2,264,320

2 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Public Schools (continued)
		Cleburne, Texas Independent School
		District
$	1,000,000	5.000%, 02/15/26 PSF Guaranteed	Aaa/NR/NR	$	1,171,670
		Crowley, Texas Independent School
		District
	1,000,000	4.000%, 08/01/35 Series A PSF
		Guaranteed	Aaa/NR/NR		1,115,550
		Davis County, Utah School District
		School Board Guaranty Program
	4,395,000	4.000%, 06/01/25 Series B	Aaa/NR/NR		5,224,293
		Duchesne County, Utah School
		District School Building, School
		Board Guaranty Program
	6,250,000	4.000%, 06/01/32	Aaa/NR/NR		7,078,375
		Eagle Pass, Texas Independent
		School District
	2,580,000	4.000%, 08/15/35 PSF Guaranteed	NR/AAA/AAA		2,840,425
	2,685,000	4.000%, 08/15/36 PSF Guaranteed	NR/AAA/AAA		2,946,331
		Forney, Texas Independent School
		District Capital Appreciation Refunding
	1,000,000	zero coupon, 08/15/39 AGMC
		Insured	NR/AA/NR		355,330
		Frisco, Texas Independent School
		District
	1,000,000	4.000%, 08/15/34 Series A PSF
		Guaranteed	Aaa/AAA/NR		1,118,280
		Grant & Douglas Counties, Washington
		School District No. 144 Quincy
		School Board Guaranty Program
	1,500,000	4.000%, 12/01/35	Aa1/AA+/NR		1,679,625
		Jefferson County, Washington School
		District No. 50 Port Townsend School
		Board Guaranty Program
	1,000,000	5.000%, 12/01/35	Aa1/NR/NR		1,216,200
		King County, Washington School District
		No. 414 Lake Washington, School
		Board Guaranty Program
	1,000,000	4.000%, 12/01/35	Aaa/AA+/NR		1,134,370

3 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Public Schools (continued)
		Kitsap County, Washington School
		District No. 401 Central Kitsap School
		Board Guaranty Program
$	1,000,000	4.000%, 12/01/35	Aa1/AA+/NR	$	1,118,840
		Lewis County, Washington School District
		No. 302 Chehalis School Board
		Guaranty Program
	1,000,000	5.000%, 12/01/34	Aa1/NR/NR		1,192,610
		Liberty Hill, Texas Independent School
		District
	935,000	4.000%, 02/01/36 PSF Guaranteed	Aaa/NR/NR		1,030,155
		San Antonio, Texas Independent
		School District
	1,000,000	4.000%, 08/15/33 PSF Guaranteed	Aaa/NR/AAA		1,126,630
		San Benito, Texas Consolidated
		Independent School District
	1,760,000	4.000%, 02/15/34 PSF Guaranteed	NR/AAA/NR		1,968,173
		Snohomish County, Washington School
		District No. 15 Edmonds School Board
		Guaranty Program
	1,500,000	4.000%, 12/01/35	Aa1/AA+/NR		1,655,325
		Taylor, Texas Consolidated Independent
		School District
	1,000,000	4.000%, 02/15/34 PSF Guaranteed	NR/AAA/NR		1,129,830
		Washoe County, Nevada School District
		Refunding & School Improvement
	2,000,000	5.000%, 06/01/30 Series A	Aa3/AA/NR		2,303,860
		Willis, Texas Independent School District
	1,000,000	4.000%, 02/15/34 PSF Guaranteed	Aaa/NR/NR		1,113,000
		Wylie, Texas Independent School
		District Capital Appreciation
	1,000,000	zero coupon, 08/15/32 PSF
		Guaranteed	Aaa/NR/NR		604,510
		Total Public Schools			44,761,303

4 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		General Obligation Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		State (1.2%)
		Texas State Transportation Commission
		Highway Improvement
$	1,000,000	5.000%, 04/01/29	Aaa/AAA/AAA	$	1,227,180
		Texas State Transportation Commission
		Mobility Fund
	1,000,000	5.000%, 10/01/31 Series 2015A	Aaa/AAA/AAA		1,245,690
		Texas State Water Financial Assistance
	1,000,000	5.000%, 08/01/30 Series E	Aaa/AAA/AAA		1,246,080
		State of Washington
	1,500,000	zero coupon, 01/01/18 Series S-2
		AGMC Insured	Aa1/AA+/AA+		1,481,580
		Total State			5,200,530

		Water and Sewer (1.4%)
		Central Utah Water Conservancy
		District Refunding
	765,000	5.000%, 04/01/28 Series B	NR/AA+/AAA		886,222
		Las Vegas Valley, Nevada Water
		District Refunding
	1,000,000	5.000%, 06/01/30 Series C	Aa1/AA/NR		1,163,160
		Las Vegas Valley, Nevada Water District
		Refunding & Water Improvement
	2,600,000	5.000%, 02/01/38 Series A	Aa1/AA/NR		2,723,188
		Las Vegas Valley, Nevada Water District
		Refunding, Limited Tax & Water
		Improvement
	1,000,000	5.000%, 06/01/36 Series A	Aa1/AA/NR		1,212,300
		Total Water and Sewer			5,984,870
		Total General Obligation Bonds			91,374,023

		Revenue Bonds (60.8%)

		Airport (1.5%)
		Broward County, Florida Airport System
		Revenue Refunding
	1,000,000	5.375%, 10/01/29 Series O	A1/A+/A		1,119,710

5 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Airport (continued)
		Clark County, Nevada Passenger Facilities
		Charge Revenue Las Vegas-McCarran
		International Airport
$	1,500,000	5.000%, 07/01/30	A1/A+/NR	$	1,673,415
		Jacksonville, Florida Aviation Authority
	1,895,000	5.000%, 10/01/26 AMBAC
		Insured AMT	A2/A/NR		1,895,000
		Miami-Dade County, Florida Aviation
		Revenue Miami International Airport
	1,675,000	5.000%, 10/01/22 Series A-1	A2/A/A		1,913,738
		Total Airport			6,601,863

		Charter Schools (8.2%)
		Utah County, Utah Charter School
		Revenue Renaissance Academy
	50,000	5.350%, 07/15/17 Series A 144A	NR/NR/NR*		50,513
		Utah State Charter School Finance
		Authority American Leadership Academy
	1,400,000	5.000%, 10/15/35	NR/AA/NR		1,616,398
		Utah State Charter School Finance
		Authority George Washington Academy
	500,000	1.000%, 04/15/18 Series 2015	NR/AA/NR		498,940
	1,500,000	5.000%, 04/15/35 Series 2015	NR/AA/NR		1,699,710
		Utah State Charter School Finance
		Authority Good Foundations Academy
	915,000	4.750%, 11/15/24 Series A 144A	NR/NR/NR*		921,359
	1,655,000	5.550%, 11/15/34 Series A 144A	NR/NR/NR*		1,666,221
	3,280,000	5.850%, 11/15/44 Series A 144A	NR/NR/NR*		3,302,173
		Utah State Charter School Finance
		Authority Hawthorn Academy Project
	2,165,000	5.000%, 10/15/29 Series 2014	NR/AA/NR		2,544,416
	1,280,000	4.000%, 10/15/31†††	NR/AA/NR		1,406,131
		Utah State Charter School Finance
		Authority Lakeview Academy
	1,300,000	5.000%, 10/15/35 Series 2015	NR/AA/NR		1,547,299

6 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Charter Schools (continued)
		Utah State Charter School Finance
		Authority Legacy Preparatory Academy
$	405,000	4.000%, 04/15/22	NR/AA/NR	$	452,583
	440,000	4.000%, 04/15/24	NR/AA/NR		501,213
	2,530,000	5.000%, 04/15/29	NR/AA/NR		2,973,383
	1,635,000	5.000%, 04/15/34	NR/AA/NR		1,884,370
		Utah State Charter School Finance
		Authority Monticello Academy
		(School Board Guaranty Program)
	1,000,000	5.000%, 04/15/37 Series 2014	NR/AA/NR		1,135,310
		Utah State Charter School Finance
		Authority Ogden Preparatory Academy
		(School Board Guaranty Program)
	475,000	4.000%, 10/15/22	NR/AA/NR		540,550
	505,000	4.000%, 10/15/23	NR/AA/NR		571,584
	525,000	4.000%, 10/15/24	NR/AA/NR		587,192
		Utah State Charter School Finance
		Authority Providence Hall Elementary
		School (School Board Guaranty Program)
	1,000,000	5.250%, 10/15/28 Series 2013A	NR/AA/NR		1,196,150
	1,000,000	5.000%, 10/15/33 Series 2013A	NR/AA/NR		1,142,890
		Utah State Charter School Finance
		Authority Davinci Academy,
		Refunding & Improvement
	1,000,000	7.050%, 09/15/26 Series 2011A	NR/BBB-/NR		1,138,300
		Utah State Charter School Finance
		Authority Venture Academy
	480,000	0.500%, 10/15/19	NR/AA/NR		472,718
	675,000	4.000%, 10/15/24	NR/AA/NR		753,833
	855,000	5.000%, 10/15/29	NR/AA/NR		1,004,839
	1,095,000	5.000%, 10/15/34	NR/AA/NR		1,263,707
	1,095,000	5.000%, 10/15/38	NR/AA/NR		1,278,248
	2,115,000	5.000%, 10/15/44	NR/AA/NR		2,413,152

7 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Charter Schools (continued)
		Utah State Charter School Finance
		Authority Wasatch Peak Academy
		Project, School Board Guaranty Program
$	740,000	5.000%, 10/15/29	NR/AA/NR	$	858,999
	700,000	5.000%, 10/15/36	NR/AA/NR		787,290
		Total Charter Schools			36,209,471

		Electric (6.7%)
		Clark County, Washington Public Utility
		District No. 001 Electric Revenue
		Refunding
	880,000	5.000%, 01/01/30	A1/A/A+		1,058,103
		Consolidated Wyoming Municipalities
		Electric Facilities Improvement Lease,
		Gillette
	1,000,000	5.000%, 06/01/31 .	A1/A+/NR		1,164,840
		Cowlitz County, Washington Public
		Utility District No. 001
	90,000	4.500%, 09/01/26 NPFG Insured
		(unrefunded balance)	A1/NR/NR		90,242
		Jacksonville Electric Authority, Florida
		Electric System Revenue
	500,000	4.500%, 10/01/32 Series Three 2012A	Aa2/AA-/AA		559,340
		Lower Colorado River Authority, Texas
	1,470,000	5.250%, 05/15/29 (unrefunded balance).	A2/A/A		1,620,572
	1,000,000	5.000%, 05/15/36 Series A
		(unrefunded balance)	A2/A/A		1,166,550
		Lower Colorado River Authority, Texas
		Transmission Contract Revenue
	1,000,000	5.000%, 05/15/30	NR/A/A+		1,206,340
		San Antonio, Texas Electric & Gas
		Revenue System
	2,000,000	4.000%, 02/01/33	Aa1/AA/AA+		2,244,500
		Santa Clara, Utah Electric Revenue
	1,005,000	4.250%, 08/01/26 AGC Insured	A3/NR/NR		1,005,603

8 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Electric (continued)
		Southeast Alaska Power Agency Electric
		Refunding & Improvement
$	1,170,000	5.250%, 06/01/30	NR/A-/NR	$	1,373,943
		St. George, Utah Electric Revenue
	1,820,000	4.000%, 06/01/32 AGMC Insured	A2/AA/NR		2,122,484
		Utah Associated Municipal Power System
		Revenue, Horse Butte Wind Project
	1,005,000	5.000%, 09/01/32 Series A	NR/A/A		1,179,468
		Utah Associated Municipal Power System
		Revenue Refunding, Payson Power Project
	2,000,000	5.000%, 04/01/24	NR/A-/A		2,340,520
	1,000,000	5.000%, 04/01/25	NR/A-/A		1,167,630
	6,375,000	5.000%, 04/01/26	NR/A-/A		7,426,939
		Utah Associated Municipal Power System
		Revenue, Veyo Heat Recovery Project
	795,000	5.000%, 03/01/30	NR/A/A		934,276
	905,000	5.000%, 03/01/32	NR/A/A		1,054,651
	745,000	5.000%, 03/01/34	NR/A/A		859,141
		Wyoming Municipal Power Agency
		Power Supply System Revenue
	720,000	5.500%, 01/01/28 Series A	A2/A-/NR		757,483
		Total Electric			29,332,625

		Higher Education (6.1%)
		Florida Higher Education Facilities
		Authority Revenue, Refunding,
		Rollins College Project
	1,000,000	5.000%, 12/01/37 Series A	A2/NR/NR		1,162,840
		Lone Star College System, Texas
	1,190,000	4.000%, 08/15/34	NR/AA/NR		1,318,092
		Salt Lake County, Utah Westminster
		College Project
	280,000	1.000%, 10/01/17	NR/BBB/NR		279,149
	685,000	5.000%, 10/01/19	NR/BBB/NR		744,958
	720,000	5.000%, 10/01/20	NR/BBB/NR		798,617
	825,000	4.750%, 10/01/20	NR/BBB/NR		838,497
	870,000	4.750%, 10/01/21	NR/BBB/NR		883,807

9 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Higher Education (continued)
		Salt Lake County, Utah Westminster
		College Project (continued)
$	790,000	5.000%, 10/01/22	NR/BBB/NR	$	896,397
	600,000	5.000%, 10/01/27	NR/BBB/NR		608,622
	955,000	5.000%, 10/01/28	NR/BBB/NR		1,105,728
	1,005,000	5.000%, 10/01/29	NR/BBB/NR		1,151,408
	1,055,000	5.000%, 10/01/30	NR/BBB/NR		1,204,451
		University of South Florida Financing Corp.,
		Florida COP Refunding Master Lease
		Program
	1,000,000	5.000%, 07/01/31 Series A	A1/A+/NR		1,196,860
		Utah State Board of Regents, Dixie State
		University
	1,800,000	5.000%, 06/01/30 AGMC Insured	NR/AA/NR		2,174,706
		Utah State Board of Regents Lease
		Revenue
	410,000	4.500%, 05/01/20 AMBAC Insured	NR/AA/NR		411,144
	425,000	4.500%, 05/01/21 AMBAC Insured	NR/AA/NR		426,182
	450,000	4.625%, 05/01/22 AMBAC Insured	NR/AA/NR		451,292
	120,000	4.650%, 05/01/23 AMBAC Insured	NR/AA/NR		120,347
		Utah State Board of Regents, University
		of Utah
	530,000	5.000%, 08/01/33 Series A	Aa1/AA+/NR		652,213
	600,000	5.000%, 08/01/35 Series A	Aa1/AA+/NR		733,494
	500,000	4.000%, 08/01/36 Series A	Aa1/AA+/NR		551,120
		Utah State Board of Regents,
		Utah State University
	1,105,000	4.000%, 12/01/30 Series B	NR/AA/NR		1,260,241
		Utah State Board of Regents, Utah Valley
		University Student Center Building Fee
		And Unified System Revenue
	3,005,000	5.000%, 11/01/28 Series 2012A	NR/AA/NR		3,609,336
		Utah State University Student Building Fee
	1,285,000	5.000%, 12/01/29 Series B	NR/AA/NR		1,546,266
	1,355,000	5.000%, 12/01/30 Series B	NR/AA/NR		1,627,680

10 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Higher Education (continued)
		Washington State Higher Education
		Facilities Authority Revenue, Refunding,
		Gonzaga University Project
$	950,000	5.000%, 04/01/24 Series B	A3/NR/NR	$	1,033,857
		Total Higher Education			26,787,304

		Hospital (2.8%)
		Brevard County, Florida Health Facilities
		Authority Health First Inc. Project
	890,000	5.000%, 04/01/18	A2/A/NR		896,177
	750,000	5.000%, 04/01/30	A2/A/NR		889,148
		Campbell County, Wyoming Hospital
		District, Hospital Revenue, Memorial
		Hospital Project
	1,040,000	5.000%, 12/01/20	NR/A-/NR		1,159,943
	1,000,000	5.500%, 12/01/34	NR/A-/NR		1,120,180
		Harris County, Texas Health Facilities
		Development Corp., Christus Health
	540,000	4.750%, 07/01/30 AGMC Insured
		(unrefunded balance)	A1/AA/NR		590,776
		Henderson, Nevada Health Care Facilities,
		Dignity Health
	1,350,000	5.250%, 07/01/31 Series B	A3/A/A		1,394,455
		Indiana Finance Authority Hospital
		Revenue, Parkview Health System
	300,000	5.875%, 05/01/29	Aa3/A+/NR		300,999
		Miami-Dade County, Florida Public
		Facilities, Jackson Health System
	1,000,000	5.000%, 06/01/29 Series A	Aa3/A+/AA-		1,216,040
		Reno, Nevada Hospital Revenue,
		Washoe Medical Center
	65,000	5.000%, 06/01/23 AGMC Insured
		(unrefunded balance)	A2/AA/NR		69,058
	70,000	5.000%, 06/01/23 AGMC Insured
		(unrefunded balance)	A2/AA/NR		74,334

11 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Hospital (continued)
		Riverton, Utah Hospital Revenue,
		Intermountain Health Care
		Health Services, Inc.
$	940,000	5.000%, 08/15/36	Aa1/AA+/NR	$	1,028,463
		Utah County, Utah Hospital Revenue,
		IHC Health Services, Inc.
	1,205,000	5.000%, 05/15/25	Aa1/AA+/NR		1,413,345
	880,000	5.000%, 05/15/28	Aa1/AA+/NR		1,023,114
	500,000	5.000%, 05/15/29	Aa1/AA+/NR		577,920
		Washington State Health Care Facilities
		Authority Revenue, Refunding,
		Fred Hutchinson Cancer
	595,000	5.000%, 01/01/18	A3/A/NR		623,465
		Total Hospital			12,377,417

		Housing (0.5%)
		Utah Housing Corporation Single
		Family Mortgage
	85,000	4.950%, 01/01/32 Series A Class II	Aa2/AA/AA		88,593
	635,000	4.500%, 01/01/24 Series A Class III	Aa3/AA-/AA-		660,083
	95,000	4.625%, 07/01/32 Series B-1 Class II	Aa2/AA/AA		99,423
	310,000	4.500%, 07/01/23 Series C	Aa3/AA-/AA-		325,506
	1,000,000	4.000%, 01/01/36 Series D FHA Insured	Aa3/AA-/AA-		1,078,880
		Total Housing			2,252,485

		Local Public Property (9.9%)
		Bluffdale, Utah Local Building Authority
		Lease Revenue
	1,215,000	4.000%, 03/01/35	A1/NR/NR		1,306,526
		Brigham, Utah Special Assessment
		Voluntary Assessment Area
	1,140,000	5.250%, 08/01/23	A1/NR/NR		1,266,038
	376,000	5.500%, 08/01/29	A1/NR/NR		419,838
		Brownsville, Texas Navigation District -
		Senior Lien
	1,220,000	5.000%, 03/01/30 AGMC Insured AMT	A2/AA/NR		1,441,662

12 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Local Public Property (continued)
		Civicventures, Alaska Revenue Refunding,
		Anchorage Convention Center
$	1,000,000	5.000%, 09/01/28	NR/A/AA-	$	1,194,940
	1,000,000	5.000%, 09/01/29	NR/A/AA-		1,185,310
	1,000,000	5.000%, 09/01/30	NR/A/AA-		1,180,960
		Clark County, Nevada Improvement
		District Special Local Improvement
		#128 (Summerlin)
	490,000	5.000%, 02/01/21 Series A	NR/NR/NR*		491,622
		Downtown Redevelopment Authority
		Texas Tax Increment Contract Revenue
	1,000,000	5.000%, 09/01/30 BAMI Insured	NR/AA/NR		1,172,320
		Eagle Mountain, Utah Special
		Assessment Area
	405,000	5.250%, 05/01/28 Series 2013	NR/A+/NR		466,803
		Harris County, Texas Sports Refunding
		Senior Lien
	500,000	5.000%, 11/15/30 Series A	A2/A-/NR		594,475
		Herriman, Utah Special Assessment
		Towne Center Assessment Area
	1,975,000	5.000%, 11/01/29	NR/AA-/NR		2,253,021
		Houston, Texas Hotel Occupancy Tax
		and Special Revenue
	1,000,000	5.000%, 09/01/31	A2/A-/NR		1,190,150
		Jacksonville, Florida Special Revenue
		and Refunding Bonds
	1,015,000	5.250%, 10/01/32 Series A	Aa3/AA-/AA-		1,239,528
		Mesquite, Nevada New Special
		Improvement District
	95,000	5.250%, 08/01/17	NR/NR/NR*		95,612
	220,000	5.350%, 08/01/19	NR/NR/NR*		221,558
	95,000	5.400%, 08/01/20	NR/NR/NR*		95,630
	340,000	5.500%, 08/01/25	NR/NR/NR*		341,669
		New Albany, Indiana Development
		Authority
	500,000	4.250%, 02/01/22	NR/A+/NR		504,555

13 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Local Public Property (continued)
		Orange County, Florida Tourist
		Development Tax Revenue Refunding
$	1,000,000	5.000%, 10/01/30	Aa3/AA-/AA	$	1,223,580
		Orem, Utah Special Assessment
	165,000	7.750%, 11/01/25	NR/NR/NR*		165,381
		Salt Lake City, Utah Local Building
		Authority Lease Revenue
	955,000	4.000%, 10/15/23 Series A	Aa1/NR/AA+		1,090,266
	395,000	4.000%, 04/15/32 Series A	Aa1/NR/NR		440,694
	425,000	4.000%, 04/15/34 Series A	Aa1/NR/NR		470,386
	460,000	4.000%, 04/15/36 Series A	Aa1/NR/NR		505,880
		South Jordan, Utah Special Assessment
		(Daybreak Assessment Area No. 1)
	1,370,000	4.000%, 11/01/27	NR/AA+/NR		1,567,705
	1,735,000	4.000%, 11/01/28	NR/AA+/NR		1,958,850
	1,500,000	4.000%, 11/01/30	NR/AA+/NR		1,668,135
		Springville, Utah Special Assessment
		Revenue
	38,000	5.500%, 01/15/17	NR/NR/NR*		38,010
	40,000	5.650%, 01/15/18	NR/NR/NR*		40,007
	43,000	5.800%, 01/15/19	NR/NR/NR*		43,003
	37,000	5.900%, 01/15/20	NR/NR/NR*		36,997
		St. Augustine, Florida Capital
		Improvement Refunding
	500,000	5.000%, 10/01/34	Aa3/A+/A+		593,440
		St. Lucie County, Florida School Board
		COP Master Lease Program
	500,000	5.000%, 07/01/30 Series A	A1/A/A+		587,225
		Unified Utah Fire Service Area Local
		Building Authority Lease Revenue
	2,350,000	4.000%, 04/01/32	Aa2/NR/NR		2,650,353
	2,450,000	4.000%, 04/01/33	Aa2/NR/NR		2,748,410
		Washington County/St. George Interlocal
		Agency, Utah Lease Revenue Refunding
	1,365,000	0.500%, 12/01/16 Series A	A1/A+/NR		1,363,471
		Weber County, Utah Special Assessment
		Summit Mountain Area
	1,590,000	5.500%, 01/15/28	NR/AA-/NR		1,955,732
	4,120,000	5.750%, 01/15/33	NR/AA-/NR		5,114,980

14 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Local Public Property (continued)
		West Valley City, Utah Municipal Building
		Authority Lease Revenue Refunding
$	900,000	4.000%, 02/01/33 AGMC Insured	NR/AA/AA-	$	996,615
	1,310,000	4.000%, 02/01/38 AGMC Insured	NR/AA/AA-		1,426,931
		Total Local Public Property			43,348,268

		Public Schools (1.3%)
		Ogden City, Utah Municipal Building
		Authority School District Lease Revenue
	1,315,000	5.000%, 01/15/31	Aa3/NR/NR		1,525,821
		Uintah County, Utah School District
		Municipal Building Authority Lease
		Revenue Refunding
	2,327,000	2.000%, 08/01/22	NR/NR/NR*		2,326,977
		Warsaw, Indiana Multi-School
		Building Corp., First Mortgage
	1,800,000	5.450%, 01/15/28 Series B	NR/AA+/NR		1,898,802
		Total Public Schools			5,751,600

		Sales Tax (4.8%)
		Bountiful City, Utah Sales Tax
		Refunding Bond
	220,000	4.000%, 06/01/17	NR/AA/NR		224,607
		Central Puget Sound, Washington
		Regional Transit Authority Sales &
		Use Tax Improvement & Refunding
	1,000,000	5.000%, 11/01/31	Aa2/AAA/NR		1,246,820
		Cottonwood Heights, Utah Sales Tax
		Revenue
	2,000,000	5.000%, 07/01/32 Series 2014	NR/AA-/NR		2,383,880
		Draper, Utah Sales Tax Revenue
	1,000,000	5.000%, 05/01/32 Series A	NR/AA/NR		1,194,090
		Herriman City, Utah Sales & Franchise
		Tax Revenue Refunding
	350,000	1.000%, 08/01/19 Series B	NR/AA-/NR		348,159
	2,040,000	4.000%, 08/01/25 Series B	NR/AA-/NR		2,395,470
	2,135,000	4.000%, 08/01/30 Series B	NR/AA-/NR		2,394,253
	1,515,000	5.000%, 08/01/33 Series B	NR/AA-/NR		1,829,135

15 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Sales Tax (continued)
		Miami-Dade County, Florida Transit
		System Sales Surtax Revenue
$	1,000,000	5.000%, 07/01/34	A1/AA/AA-	$	1,196,860
		Riverton City, Utah Franchise & Sales
		Tax Revenue
	750,000	4.000%, 06/01/30	NR/AA-/AA		828,442
	1,000,000	5.250%, 12/01/36	NR/AA-/AA		1,205,710
		South Jordan, Utah Redevelopment
		Agency Subordinated Sales Tax & Tax
		Increment Revenue
	1,000,000	5.000%, 04/01/29	NR/AA-/AA+		1,201,160
		Spanish Fork City, Utah Sales Tax
		Revenue Refunding
	1,115,000	0.750%, 04/15/18 Series 2014	NR/AA-/NR		1,112,636
		Utah Transit Authority Sales Tax Revenue
	1,000,000	4.000%, 12/15/30	A1/A+/AA		1,135,770
		Utah Transit Authority Sales Tax Revenue
		Subordinated, Capital Appreciation
	1,000,000	zero coupon, 12/15/32	A1/A+/AA		596,860
		West Valley City, Utah Sales Tax Revenue
		Capital Appreciation Bonds, Refunding
	3,500,000	zero coupon, 07/15/35	NR/AA+/NR		1,655,920
		Total Sales Tax			20,949,772

		State Agency (2.3%)
		Utah Infrastructure Agency
		Telecommunications & Franchise Tax
	635,000	1.000%, 10/15/19	A2/AA-/NR		627,494
	1,970,000	5.250%, 10/15/30	A2/AA-/NR		2,430,468
	1,000,000	5.000%, 10/15/33	A2/AA-/NR		1,182,820
	1,630,000	5.250%, 10/15/38	A2/AA-/NR		1,953,245
	1,000,000	5.500%, 10/15/30 Series A
		AGMC Insured	A2/AA/NR		1,185,550
	1,475,000	5.250%, 10/15/33 Series A
		AGMC Insured	A2/AA/NR		1,721,650

16 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		State Agency (continued)
		Utah State Building Ownership Authority
		Lease Revenue Refunding State Facilities
		Master Lease Program
$	1,000,000	5.000%, 05/15/24	Aa1/AA+/NR	$	1,254,930
		Total State Agency			10,356,157

		Transportation (5.4%)
		Clark County, Nevada Highway
		Improvement Revenue Indexed Fuel
		Tax & Subordinate Motor Vehicle
		Fuel Tax
	2,000,000	5.000%, 07/01/31	Aa3/AA-/NR		2,432,300
		North Texas Tollway Authority, Texas
	755,000	6.100%, 01/01/28 Series A
		(unrefunded balance)	A1/A/NR		838,775
		Utah Transit Authority Sales Tax
		Revenue
	1,000,000	5.000%, 06/15/31 Series A	Aa2/AAA/AA		1,244,620
	2,000,000	5.000%, 06/15/38 Series A	Aa2/AAA/AA		2,440,900
		Utah Transit Authority Sales
		Tax Revenue Subordinated
	5,000,000	5.000%, 06/15/34 Series A	A1/A+/AA		6,023,200
	5,000,000	5.000%, 06/15/37 Series A	A1/A+/AA		5,971,200
		Utah Transit Authority Sales Tax
		Revenue Refunding
	1,000,000	5.000%, 06/15/32	A1/A+/AA		1,192,130
		Utah Transit Authority Sales Tax &
		Transportation Revenue
	195,000	5.250%, 06/15/32 AGMC Insured	Aa2/AAA/AA		263,732
		Washoe County, Nevada Highway
		Revenue Fuel Tax
	1,000,000	5.500%, 02/01/28	A1/A+/NR		1,103,760
	1,000,000	5.000%, 02/01/32	A1/A+/NR		1,085,310
	1,000,000	5.000%, 02/01/38	A1/A+/NR		1,082,190
		Total Transportation			23,678,117

17 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Water and Sewer (11.3%)
		Central Utah Water Conservancy
		District Refunding, Jordanelle Hydrant
$	1,125,000	4.500%, 10/01/27 Series A	NR/AA/AA	$	1,288,395
		Central Weber, Utah Sewer Improvement
		District Revenue Refunding
	1,000,000	5.000%, 03/01/28 Series A
		AGMC Insured	NR/AA/AA		1,116,120
	4,000,000	5.000%, 03/01/33 Series A
		AGMC Insured	NR/AA/AA		4,443,320
		Davie, Florida Water & Sewer Revenue
	1,000,000	5.000%, 10/01/32 AGMC Insured	Aa3/AA/NR		1,150,480
		El Paso, Texas Water & Sewer Revenue
		Refunding
	1,000,000	4.500%, 03/01/31 Series C	NR/AA+/AA+		1,162,280
		Florida State Governmental Utility
		Authority Refunding Revenue Bonds
		(Lehigh Utility System)
	500,000	5.000%, 10/01/31 Series 2014
		AGMC Insured	A2/AA/NR		593,995
		Jordan Valley, Utah Water Conservancy
		District Revenue
	6,000,000	5.000%, 10/01/35 Series B	NR/AA+/AA+		6,871,800
		Jordanelle, Utah Special Service District
	206,000	5.200%, 11/15/16	NR/NR/NR*		206,078
	216,000	5.300%, 11/15/17	NR/NR/NR*		216,127
	228,000	5.400%, 11/15/18	NR/NR/NR*		228,135
	240,000	5.500%, 11/15/19	NR/NR/NR*		240,113
	253,000	5.600%, 11/15/20	NR/NR/NR*		253,063
	268,000	5.700%, 11/15/21	NR/NR/NR*		268,054
	283,000	5.800%, 11/15/22	NR/NR/NR*		283,062
	299,000	6.000%, 11/15/23	NR/NR/NR*		299,063
		Kane County, Utah Water Conservancy
		District Revenue Refunding
	945,000	4.000%, 08/15/29 AGMC Insured	NR/AA/NR		1,078,793
		Miami-Dade County, Florida Water
		and Sewer Revenue System
	1,000,000	5.000%, 10/01/26	Aa3/A+/A+		1,268,280

18 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Water and Sewer (continued)
		Miami-Dade County, Florida Water
		and Sewer Revenue System (continued)
$	1,500,000	5.000%, 10/01/29 AGC Insured	Aa3/AA/A+	$	1,701,915
	1,000,000	5.000%, 10/01/31 Series A	Aa3/A+/A+		1,191,540
		Mountain Regional Water Special
		Service District, Utah Water
		Revenue Refunding
	3,000,000	5.000%, 12/15/33 AGMC Insured	NR/AA/A+		3,475,560
		North Slope Borough, Alaska Service
		Area 10 Water & Wastewater Facilities
	1,000,000	5.250%, 06/30/27	NR/A-/NR		1,151,450
	1,000,000	5.250%, 06/30/28	NR/A-/NR		1,150,970
	1,000,000	5.250%, 06/30/34	NR/A-/NR		1,144,240
		Ogden City, Utah Sewer & Water
		Revenue Bonds
	1,160,000	5.250%, 06/15/30 Series B	Aa3/AA-/NR		1,417,856
	750,000	4.625%, 06/15/38 AGMC Insured	Aa3/NR/NR		788,535
		Ogden City, Utah Storm Drain
		Revenue Bonds
	500,000	5.250%, 06/15/28	NR/AA/NR		615,050
		Okaloosa County, Florida Water and
		Sewer Revenue
	1,000,000	5.000%, 07/01/30	Aa3/NR/AA-		1,222,360
		Orem, Utah Water & Storm Sewer
		Revenue
	1,000,000	5.000%, 07/15/26	NR/AA+/AA+		1,070,660
	1,250,000	5.250%, 07/15/28	NR/AA+/AA+		1,343,825
		Pleasant Grove City, Utah Water Revenue
	1,000,000	5.250%, 12/01/29 AGMC Insured	NR/AA/NR		1,088,820
		Salt Lake & Sandy, Utah Metropolitan
		Water District, Water Revenue,
		Refunding
	1,100,000	5.000%, 07/01/37 Series A	NR/AA+/AA+		1,297,659
		San Jacinto, Texas River Authority
		Woodlands Waste Disposal
	1,000,000	5.000%,10/01/30 BAMI Insured	NR/AA/NR		1,192,610

19 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Revenue Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Water and Sewer (continued)
		Sarasota, Florida Utility System
		Revenue Refunding
$	1,455,000	5.000%, 10/01/27	NR/AA+/AA+	$	1,713,466
		South Weber City, Utah Water Revenue
	930,000	5.000%, 06/01/40 AGMC Insured	NR/AA/NR		1,031,323
		Texas Water Development Board State
		Water Implementation Fund
	3,000,000	4.000%, 10/15/33†††	NR/AAA/AAA		3,418,980
		Utah Water Finance Agency Revenue
	1,645,000	4.500%, 10/01/28 AMBAC Insured	Aa3/NR/NR		1,698,693
		Weber Basin, Utah Water Conservancy
		District Refunding
	915,000	4.000%, 10/01/31 Series A	NR/AA+/AAA		1,007,552
		Total Water and Sewer			49,690,222
		Total Revenue Bonds			267,335,301

		Pre-Refunded \
		Escrowed to Maturity Bonds (15.9%)††

		Pre-Refunded
		General Obligation Bonds (1.6%)

		City and County (0.4%)
		Miami-Dade County, Florida Building
		Better Communities Program
	1,605,000	5.625%, 07/01/38	Aa2/AA/NR		1,736,112

		Public Schools (0.4%)
		Clark County, Nevada School District
	500,000	5.000%, 06/15/28 Series A	A1/AA-/A+		535,090
		Granite School District, Utah, Salt Lake
		County School Building School Board
		Guaranty Program
	1,000,000	5.000%, 06/01/31	Aaa/NR/AAA		1,180,500
		Total Public Schools			1,715,590

20 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded \Escrowed to Maturity Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Pre-Refunded
		General Obligation Bonds (continued)
		State (0.6%)
		Texas State Transportation Commission
		Mobility Fund
$	1,140,000	5.000%, 04/01/27 Series A	Aaa/AAA/NR	$	1,163,541
		Washington State Various Purpose
	1,405,000	5.000%, 07/01/30 Series A	Aa1/AA+/NR		1,448,162
		Total State			2,611,703

		Water and Sewer (0.2%)
		Virgin Valley, Nevada Water District
	955,000	5.000%, 03/01/34 AGC Insured	A1/NR/NR		1,009,970
		Total Pre-Refunded General
		Obligation Bonds			7,073,375

		Pre-Refunded\Escrowed to Maturity
		Revenue Bonds (14.3%)

		Charter Schools (0.5%)
		Utah County, Utah Charter School
		Revenue, Ronald Wilson Reagan
		Academy
	875,000	5.750%, 02/15/22 Series A	NR/BB+/NR		920,518
	1,000,000	6.000%, 02/15/38 Series A	NR/BB+/NR		1,068,540
		Total Charter Schools			1,989,058

		Electric (1.5%)
		Clark County, Washington Public
		Utility District No. 001 Generating
		Refunding
	1,000,000	5.000%, 01/01/24	A1/A/A+		1,128,520
		Eagle Mountain, Utah Gas & Electric
	325,000	5.000%, 06/01/24 AGMC Insured	NR/AA/NR		382,850
		St. George, Utah Electric Revenue
	3,750,000	5.000%, 06/01/38 AGMC Insured	A2/NR/NR		4,003,987
		Lower Colorado River Authority, Texas
	60,000	5.250%, 05/15/29	NR/NR/NR*		66,605
	5,000	5.250%, 05/15/29	NR/NR/NR*		5,537

21 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded \Escrowed to Maturity Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Pre-Refunded\Escrowed to Maturity
		Revenue Bonds (continued)
		Electric (continued)
		San Antonio, Texas Electric & Gas
		Revenue System
$	1,000,000	5.000%, 02/01/32	Aa1/AA/AA+	$	1,053,480
		Total Electric			6,640,979

		Higher Education (1.6%)
		Texas State University System
		Financing Revenue
	2,000,000	5.250%, 03/15/25	Aa2/NR/NR		2,123,960
		Utah State Board of Regents, University
		of Utah- Auxiliary and Campus Facilities
	2,980,000	4.500%, 04/01/29 Series 2012A	Aa2/AA+/NR		3,511,274
		Utah State Board of Regents,
		University of Utah Hospital Revenue
	1,245,000	5.000%, 08/01/31	Aa2/AA/NR		1,430,779
		Total Higher Education			7,066,013

		Hospital (0.7%)
		Harris County, Texas Health Facilities
		Development Corp., Christus Health
	260,000	4.750%, 07/01/30 AGMC Insured	A1/NR/NR		295,690
		Reno, Nevada Hospital Revenue,
		Washoe Medical Center
	615,000	5.000%, 06/01/23 AGMC Insured
		(prerefunded)	A2/AA/NR		655,596
	655,000	5.000%, 06/01/23 AGMC Insured
		(prerefunded)	A2/AA/NR		699,363
		Richmond, Indiana Hospital Authority,
		Reid Hospital Project
	155,000	5.000%, 01/01/19 Series A ETM	NR/A/A		162,252
		Tarrant County, Texas Cultural Education
		Facilities Finance Corp. Hospital
		Refunding, Baylor Healthcare System
	930,000	5.250%, 08/15/25	AA3/AA-/NR		1,078,940
	70,000	5.250%, 08/15/25	NR/NR/NR*		81,211
		Total Hospital			2,973,052

22 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded \Escrowed to Maturity Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Pre-Refunded\Escrowed to Maturity
		Revenue Bonds (continued)
		Local Public Property (2.7%)
		Herriman, Utah Special Assessment
		Towne Center Assessment Area
$	1,045,000	4.875%, 11/01/23	NR/AA-/NR	$	1,187,538
	1,150,000	5.000%, 11/01/25	NR/AA-/NR		1,311,885
		Salt Lake Valley, Utah Fire Service
		District Lease Revenue
	500,000	5.000%, 04/01/22	Aa2/NR/AA-		530,480
	2,645,000	5.200%, 04/01/28	Aa2/NR/AA-		2,814,042
	1,000,000	5.250%, 04/01/30	Aa2/NR/AA-		1,064,650
		Uintah County, Utah Municipal
		Building Authority Lease Revenue
	500,000	5.000%, 06/01/24	NR/A+/NR		534,290
	2,000,000	5.300%, 06/01/28	NR/A+/NR		2,147,020
	1,005,000	5.500%, 06/01/37	NR/A+/NR		1,082,174
	1,120,000	5.500%, 06/01/40	NR/A+/NR		1,206,005
		Total Local Public Property			11,878,084

		Public Schools (0.2%)
		Tooele County, Utah Municipal
		Building Authority School District
		Lease Revenue
	1,000,000	5.000%, 06/01/28	NR/A+/NR		1,067,730

		Sales Tax (0.5%)
		Riverton City, Utah Franchise & Sales
		Tax Revenue
	750,000	5.000%, 06/01/24 AMBAC Insured	NR/AA-/AA		770,445
		Riverton City, Utah Franchise & Sales
		Tax Revenue
	1,585,000	5.000%, 06/01/31 AMBAC Insured	NR/AA-/AA		1,628,207
		Total Sales Tax			2,398,652

		State Agency (0.4%)
		Utah State Building Ownership Authority
		Lease Revenue Refunding State Facilities
		Master Lease Program
	1,575,000	5.000%, 05/15/26	Aa1/AA+/NR		1,740,407

23 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded \Escrowed to Maturity Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Pre-Refunded\Escrowed to Maturity
		Revenue Bonds (continued)
		Transportation (3.6%)
		Dallas, Texas Area Rapid Transit Sales
		Tax Revenue Refunding Senior Lien
$	1,435,000	5.000%, 12/01/36 AMBAC Insured	Aa2/NR/NR	$	1,444,356
		North Texas Tollway Authority, Texas
	3,315,000	6.100%, 01/01/28 Series A	NR/NR/NR*		3,687,540
		Utah Transit Authority Sales
		Tax Revenue
	2,000,000	5.000%, 06/15/27 Series A	Aa2/AAA/NR		2,138,600
	1,000,000	5.000%, 06/15/28 Series A	Aa2/AAA/NR		1,069,300
	6,920,000	5.000%, 06/15/36 AGMC Insured
		Series A	Aa2/AAA/NR		7,399,556
		Total Transportation			15,739,352

		Water and Sewer (2.6%)
		Cape Coral, Florida Water & Sewer
		Revenue
	1,000,000	5.000%, 10/01/36 AGMC-AMBAC
		Insured	A1/AA/A		1,000,000
		King County, Washington Sewer Revenue
	660,000	5.000%, 01/01/33 AGMC Insured	Aa2/AA+/NR		680,275
		Laredo, Texas Waterworks Sewer
		System Revenue
	1,450,000	5.000%, 03/01/24 Series 2010	A1/AA-/AA-		1,642,661
		Pleasant Grove City, Utah
		Water Revenue
	450,000	4.300%, 12/01/20 NPFG Insured	A3/AA-/NR		452,448
	1,370,000	5.000%, 12/01/31 Series B NPFG
		Insured	A3/AA-/NR		1,378,932
		Salt Lake & Sandy, Utah Metropolitan
		Water District, Water Revenue,
		Refunding
	650,000	5.000%, 07/01/31 Series A	NR/AA+/AA+		721,181
		Tacoma, Washington Solid Waste
		Utility Revenue
	1,000,000	5.000%, 12/01/23 Syncora Guarantee, Inc.
		Insured	A1/AA/AA-		1,006,440

24 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Principal Amount		Pre-Refunded \Escrowed to Maturity Bonds (continued)	Rating Moody’s, S&P and Fitch	Value

		Pre-Refunded\Escrowed to Maturity
		Revenue Bonds (continued)
		Water and Sewer (continued)
		Tampa Bay, Florida Regional Water
		Refunding & Improvement
$	885,000	4.750%, 10/01/33 NPFG Insured	Aa1/AA+/AA+	$	885,000
		Uintah Water Conservancy District,
		Utah, Water Conservancy Revenue
	1,400,000	5.250%, 01/15/27 Series 2009A	NR/NR/NR*		1,534,974
		White City, Utah Water Improvement
		District Revenue
	500,000	5.000%, 02/01/23 AGMC Insured	A2/NR/NR		506,740
	700,000	5.000%, 02/01/25 AGMC Insured	A2/NR/NR		709,436
	840,000	5.000%, 02/01/27 AGMC Insured	A2/NR/NR		851,323
		Total Water and Sewer			11,369,410
		Total Pre-Refunded\ Escrowed to
		Maturity Revenue Bonds			62,862,737
		Total Pre-Refunded\
		Escrowed to Maturity Bonds			69,936,112
		Total Municipal Bonds
		(cost $403,932,126)			428,645,436

Shares		Short-Term Investment (2.5%)
	11,232,298	Dreyfus Tax Exempt Cash Management,
		Institutional Shares, 0.55%**
		(cost $11,232,298)	NR/Aaam/NR		11,232,298
		Total Investments
		(cost $415,164,424-note 4)	100.0%		439,877,734
		Other assets less liabilities	(0.0)		(96,290	)
		Net Assets	100.0%	$	439,781,444

25 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

	Percent of
Portfolio Distribution By Quality Rating	Investments†
Aaa of Moody’s or AAA of S&P and Fitch		11.8	%
Pre-Refunded bonds\ ETM bonds††		16.3
Aa of Moody’s or AA of S&P and Fitch		53.3
A of Moody’s or S&P and Fitch		13.6
BBB of S&P		2.2
Not Rated*		2.8
		100.0	%

PORTFOLIO ABBREVIATIONS:
AGC - Assured Guaranty Corp.
AGMC - Assured Guaranty Municipal Corp.
AMBAC - American Municipal Bond Assurance Corp.
AMT - Alternative Minimum Tax
BAMI - Build America Mutual Insurance
COP - Certificates of Participation
ETM - Escrowed to Maturity
FHA - Federal Housing Administration
IHC - Intermountain Health Care
NPFG - National Public Finance Guarantee
NR - Not Rated
PSF- Permanent School Fund

26 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

*		Any security not rated (“NR”) by any of the Nationally Recognized Statistical Rating Organizations (“NRSRO”) has been determined by the Investment Adviser to have sufficient quality to be ranked in the top credit four ratings if a credit rating were to be assigned by a NRSRO.

**		The rate is an annualized seven-day yield at period end.

		Note: 144A – Private placement subject to SEC rule 144A, which modifies a two-year holding period requirement to permit qualified institutional buyers to trade these securities among themselves, thereby significantly improving the liquidity of these securities.

†		Calculated using the highest rating of the three NRSRO. Percentages in this table do not include the Short-Term Investment.

††		Pre-refunded bonds are bonds secured by an escrow account, comprised of U.S. Government Obligations (unless otherwise noted), to retire the bonds at their earliest call date. Escrowed to Maturity bonds are bonds where money has been placed in the escrow account which is used to pay principal and interest through the bond’s originally scheduled maturity date. Escrowed to Maturity are shown as ETM. All other securities in the category are pre-refunded.

†††		Security purchased on a delayed delivery or when-issued basis.

See accompanying notes to financial statements.

27 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

STATEMENT OF ASSETS AND LIABILITIES

SEPTEMBER 30, 2016 (unaudited)

ASSETS
Investments at value (cost $415,164,424)	$	439,877,734
Interest receivable		5,703,777
Receivable for Fund shares sold		955,756
Other assets		28,550
Total assets		446,565,817
LIABILITIES
Payable for investment securities purchased		4,801,091
Payable for Fund shares redeemed		1,487,372
Management fee payable		183,009
Dividends payable		173,974
Distribution and service fees payable		9,686
Accrued expenses payable		129,241
Total liabilities		6,784,373

NET ASSETS	$	439,781,444
Net Assets consist of:
Capital Stock - Authorized an unlimited number of shares,
par value $0.01 per share	$	413,382
Additional paid-in capital		413,916,885
Net unrealized appreciation on investments (note 4)		24,713,310
Accumulated net realized gain on investments		466,915
Undistributed net investment income		270,952
	$	439,781,444
CLASS A
Net Assets	$	231,361,347
Capital shares outstanding		21,763,485
Net asset value and redemption price per share	$	10.63
Maximum offering price per share (100/96 of $10.63)	$	11.07
CLASS C
Net Assets	$	80,866,113
Capital shares outstanding		7,613,929
Net asset value and offering price per share	$	10.62
Redemption price per share (*a charge of 1% is imposed
on the redemption proceeds, or on the original price,
whichever is lower, if redeemed during the first 12
months after purchase)	$	10.62	*
CLASS Y
Net Assets	$	127,553,984
Capital shares outstanding		11,960,786
Net asset value, offering and redemption price per share	$	10.66

See accompanying notes to financial statements.

28 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

STATEMENT OF OPERATIONS

SIX MONTHS ENDED SEPTEMBER 30, 2016 (unaudited)

Investment Income:

Interest income				$	7,165,422

Expenses:

Management fee (note 3)	$	1,073,347
Distribution and service fees (note 3)		624,211
Transfer and shareholder servicing agent fees		111,498
Trustees’ fees and expenses (note 6)		64,520
Legal fees		54,026
Fund accounting fees		28,832
Shareholders’ reports		15,370
Registration fees and dues		15,155
Auditing and tax fees		11,544
Insurance		8,900
Custodian fees		6,680
Chief compliance officer services (note 3)		6,500
Miscellaneous		20,446
Total expenses		2,041,029

Management fee waived (note 3)		(48,963	)
Net expenses					1,992,066
Net investment income					5,173,356

Realized and Unrealized Gain (Loss) on Investments:

Net realized gain (loss) from securities
transactions		120,562
Change in unrealized appreciation on
investments		2,491,930

Net realized and unrealized gain (loss) on
investments					2,612,492
Net change in net assets resulting from operations				$	7,785,848

See accompanying notes to financial statements.

29 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

STATEMENTS OF CHANGES IN NET ASSETS

	Six Months Ended
	September 30, 2016			Year Ended
	(unaudited)			March 31, 2016
OPERATIONS:
Net investment income	$	5,173,356		$	10,172,024
Net realized gain (loss) from
securities transactions		120,562			346,871
Change in unrealized appreciation
on investments		2,491,930			1,989,435
Change in net assets from
operations		7,785,848			12,508,330

DISTRIBUTIONS TO SHAREHOLDERS (note 9):
Class A Shares:
Net investment income		(2,850,766	)		(5,745,329	)
Net realized gain on investments		––			(124,358	)

Class C Shares:
Net investment income		(663,994	)		(1,524,152	)
Net realized gain on investments		––			(42,845	)

Class Y Shares:
Net investment income		(1,622,601	)		(2,869,555	)
Net realized gain on investments		––			(58,908	)
Change in net assets from
distributions		(5,137,361	)		(10,365,147	)

CAPITAL SHARE TRANSACTIONS (note 7):
Proceeds from shares sold		58,481,591			86,226,199
Reinvested dividends and
distributions		4,184,098			8,497,616
Cost of shares redeemed		(32,288,753	)		(76,235,434	)
Change in net assets from
capital share transactions		30,376,936			18,488,381

Change in net assets		33,025,423			20,631,564

NET ASSETS:
Beginning of period		406,756,021			386,124,457

End of period*	$	436,781,444		$	406,756,021
*Includes undistributed net investment income of:	$	270,952		$	234,957

See accompanying notes to financial statements.

30 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2016 (unaudited)

1. Organization

Aquila Tax-Free Fund For Utah (the “Fund”), a series of Aquila Municipal Trust (prior to October 12, 2013, the Fund operated under the name Tax-Free Fund For Utah), a non-diversified, open-end investment company, was organized on December 12, 1990 as a Massachusetts business trust and commenced operations on July 24, 1992. The Fund is authorized to issue an unlimited number of shares. Class A Shares are sold at net asset value plus a sales charge of varying size (depending upon a variety of factors) paid at the time of purchase and bear a distribution fee. Class C Shares are sold at net asset value with no sales charge payable at the time of purchase but with a level charge for service and distribution fees for six years thereafter. Class C Shares automatically convert to Class A Shares after six years. Class Y Shares are sold only through authorized financial institutions acting for investors in a fiduciary, advisory, agency, custodial or similar capacity, and are not offered directly to retail customers. Class Y Shares are sold at net asset value with no sales charge, no redemption fee, no contingent deferred sales charge (“CDSC”) and no distribution fee. Class I Shares are offered and sold only through financial intermediaries and are not offered directly to retail customers. Class I Shares are sold at net asset value with no sales charge and no redemption fee or CDSC, although a financial intermediary may charge a fee for effecting a purchase or other transaction on behalf of its customers. Class I Shares carry a distribution and a service fee. As of the report date, there were no Class I Shares outstanding. All classes of shares represent interests in the same portfolio of investments and are identical as to rights and privileges but differ with respect to the effect of sales charges, the distribution and/or service fees borne by each class, expenses specific to each class, voting rights on matters affecting a single class and the exchange privileges of each class.

2. Significant Accounting Policies

31 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.

The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities

The following is a summary of the valuation inputs, representing 100% of the Fund’s investments, used to value the Fund’s net assets as of September 30, 2016:

Valuation Inputs*	Investments in Securities
Level 1 – Quoted Prices — Short-Term Investment	$	11,232,298
Level 2 – Other Significant Observable
Inputs — Municipal Bonds*		428,645,436
Level 3 – Significant Unobservable Inputs		—
Total	$	439,877,734

*See schedule of investments for a detailed listing of securities.

c)	Subsequent events: In preparing these financial statements, the Fund has evaluated events and transactions for potential recognition or disclosure through the date these financial statements were issued.

32 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Reclassification of capital accounts: Accounting principles generally accepted in the United States of America require that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per share. For the year ended March 31, 2016, there were no items identified that have been reclassified among components of net assets.

i)	The Fund is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 “Financial Services-Investment Companies”

3. Fees and Related Party Transactions

a) Management Arrangements:

Aquila Investment Management LLC (the “Manager”), a wholly-owned subsidiary of Aquila Management Corporation, the Fund’s founder and sponsor, serves as the Manager for the Fund under an Advisory and Administration Agreement with the Fund. Under the Advisory and Administration Agreement, the Manager provides all investment management and administrative services to the Fund. The Manager’s services include providing the office of the Fund and all related services as well as managing relationships with all the various support organizations to the Fund such as the shareholder servicing agent, custodian, legal counsel, fund accounting agent, auditors and distributor. For its services, the Manager is entitled to receive a fee which is payable monthly and computed as of the close of business each day at the annual rate of 0.50% on the Fund’s net assets.

The Manager has contractually undertaken to waive fees and/or reimburse Fund expenses so that total Fund expenses will not exceed 0.84% for a Class A Shares, 1.64% for Class C Shares, 0.96% for Class I Shares and 0.63% for Class Y Shares through September 30, 2017. The Manager may not terminate the arrangement without the approval of the Board of Trustees. For the six months ended September 30, 2016, the Fund incurred management fees of $1,073,347 of which $48,963 was waived.

33 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Specific details as to the nature and extent of the services provided by the Manager are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

b) Distribution and Service Fees:

The Fund has adopted a Distribution Plan (the “Plan”) pursuant to Rule 12b-1 (the “Rule”) under the Investment Company Act of 1940. Under one part of the Plan, with respect to Class A Shares, the Fund is authorized to make distribution fee payments to broker-dealers or others (“Qualified Recipients”) selected by Aquila Distributors LLC (the “Distributor”) including, but not limited to, any principal underwriter of the Fund, with which the Distributor has entered into written agreements contemplated by the Rule and which have rendered assistance in the distribution and/or retention of the Fund’s shares or servicing of shareholder accounts. The Fund makes payment of this distribution fee at the annual rate of 0.20% of the Fund’s average net assets represented by Class A Shares. For the six months ended September 30, 2016, distribution fees on Class A Shares amounted to $229,490, of which the Distributor retained $8,035.

Under another part of the Plan, the Fund is authorized to make payments with respect to Class C Shares to Qualified Recipients which have rendered assistance in the distribution and/or retention of the Fund’s Class C shares or servicing of shareholder accounts. These payments are made at the annual rate of 0.75% of the Fund’s average net assets represented by Class C Shares. For the six months ended September 30, 2016, these payments amounted to $296,041. In addition, under a Shareholder Services Plan, the Fund is authorized to make service fee payments with respect to Class C Shares to Qualified Recipients for providing personal services and/or maintenance of shareholder accounts. These payments are made at the annual rate of 0.25% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, amounted to $98,680. The total of these payments with respect to Class C Shares amounted to $394,721, of which the Distributor retained $93,070.

Specific details about the Plans are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

Under a Distribution Agreement, the Distributor serves as the exclusive distributor of the Fund’s shares. Through agreements between the Distributor and various brokerage and advisory firms (“intermediaries”), the Fund’s shares are sold primarily through the facilities of these intermediaries having offices within Utah, with the bulk of any sales commissions inuring to such intermediaries. For the six months ended September 30, 2016, total commissions on sales of Class A Shares amounted to $311,705, of which the Distributor received $27,723.

34 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

4. Purchases and Sales of Securities

During the six months ended September 30, 2016, purchases of securities and proceeds from the sales of securities aggregated $63,058,327 and $29,992,536, respectively.

At September 30, 2016, the aggregate tax cost for all securities was $415,077,123. At September 30, 2016, the aggregate gross unrealized appreciation for all securities in which there is an excess of value over tax cost amounted to $24,915,637 and aggregate gross unrealized depreciation for all securities in which there is an excess of tax cost over value amounted to $115,026, for a net unrealized appreciation of $24,800,611.

5. Portfolio Orientation

At least 50% of the Fund’s assets will always consist of obligations of Utah-based issuers. At September 30, 2016, the Fund had 58% of its net assets invested in municipal obligations of issuers within Utah. The Fund is also permitted to invest in tax-free municipal obligations of non-Utah-based issuers that are exempt from regular Federal income taxes and, pursuant to an administrative determination of the Utah State Tax Commission issued under statutory authority, the interest on which is currently exempt from Utah individual income taxes. Since the Fund invests principally and may invest entirely in double tax-free municipal obligations of issuers within Utah, it is subject to possible risks associated with economic, political, or legal developments or industrial or regional matters specifically affecting Utah and whatever effects these may have upon Utah issuers’ ability to meet their obligations.

6. Trustees’ Fees and Expenses

For the six months ended September 30, 2016 there were 9 Trustees, one of whom is affiliated with the Manager and is not paid any fees. The total amount of Trustees’ service fees (for carrying out their responsibilities) and attendance fees paid during the six months ended September 30, 2016 was $55,931. Attendance fees are paid to those in attendance at regularly scheduled quarterly Board Meetings and meetings of the Independent Trustees held prior to each quarterly Board Meeting, as well as additional meetings (such as Audit, Nominating, Shareholder and special meetings). Trustees are reimbursed for their expenses such as travel, accommodations and meals incurred in connection with attendance at Board Meetings and the Annual Meeting of Shareholders. For the six months ended September 30, 2016, such meeting-related expenses amounted to $8,589.

35 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

7. Capital Share Transactions

Transactions in Capital Shares of the Fund were as follows:

	Six Months Ended
	September 30, 2016						Year Ended
	(unaudited)						March 31, 2016
	Shares			Amount			Shares			Amount
Class A Shares:
Proceeds from shares sold		1,923,748		$	20,509,806			3,462,768		$	36,146,607
Reinvested distributions		213,053			2,267,712			454,744			4,748,096
Cost of shares redeemed		(1,262,447	)		(13,450,089	)		(2,597,503	)		(27,064,233	)
Net change		874,354			9,327,429			1,320,009			13,830,470
Class C Shares:
Proceeds from shares sold		1,389,724			14,807,640			1,742,925			18,193,813
Reinvested distributions		51,944			552,370			126,090			1,314,676
Cost of shares redeemed		(891,968	)		(9,497,997	)		(2,486,917	)		(25,912,264	)
Net change		549,700			5,862,013			(617,902	)		(6,403,775	)
Class Y Shares:
Proceeds from shares sold		2,165,807			23,164,145			3,037,344			31,885,779
Reinvested distributions		127,516			1,364,016			232,358			2,434,844
Cost of shares redeemed		(873,227	)		(9,340,667	)		(2,224,581	)		(23,258,937	)
Net change		1,420,096			15,187,494			1,045,121			11,061,686
Total transactions in Fund
shares		2,844,150		$	30,376,936			1,747,228		$	18,488,381

8. Securities Traded on a When-Issued Basis

9. Income Tax Information and Distributions

36 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

The tax character of distributions was as follows:

	Year		Year
	Ended		Ended
	March 31, 2016		March 31, 2015
Net tax-exempt income	$	10,090,965	$	10,981,022
Ordinary Income		48,071		16,940
Capital Gains		226,111		279,359
	$	10,365,147	$	11,277,321

As of March 31, 2016, the components of distributable earnings on a tax basis were:

Undistributed tax-exempt income	$	182,571
Accumulated net realized gain		352,958
Unrealized appreciation		22,363,346
Other temporary differences		(96,185	)
	$	22,802,690

37 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

FINANCIAL HIGHLIGHTS

For a share outstanding throughout each period

	Class A
	Six Months															Year Ended
	Ended			Year			Year			Year			Nine Months			June 30,
	9/30/16 (unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.56		$	10.50		$	10.10		$	10.37		$	10.27		$	9.74		$	9.80
Income (loss) from investment operations:
Net investment income(1)		0.13			0.29			0.33			0.33			0.26			0.38			0.42
Net gain (loss) on securities (both
realized and unrealized)		0.07			0.06			0.40			(0.24	)		0.10			0.53			(0.05	)
Total from investment operations		0.20			0.35			0.73			0.09			0.36			0.91			0.37
Less distributions (note 9):
Dividends from net investment income		(0.13	)		(0.28	)		(0.32	)		(0.33	)		(0.26	)		(0.38	)		(0.43	)
Distributions from capital gains		–			(0.01	)		(0.01	)		(0.03	)		–			–			–
Total distributions		(0.13	)		(0.29	)		(0.33	)		(0.36	)		(0.26	)		(0.38	)		(0.43	)
Net asset value, end of period	$	10.63		$	10.56		$	10.50		$	10.10		$	10.37		$	10.27		$	9.74
Total return (not reflecting sales charge)		1.92	%(2)		3.41	%		7.34	%		0.96	%		3.48	%(2)		9.49	%		3.87	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	231		$	221		$	205		$	204		$	257		$	255		$	212
Ratio of expenses to average net assets		0.85	%(3)		0.84	%		0.84	%		0.83	%		0.83	%(3)		0.83	%		0.83	%
Ratio of net investment income to
average net assets		2.53	%(3)		2.75	%		3.14	%		3.33	%		3.28	%(3)		3.79	%		4.31	%
Portfolio turnover rate		7	%(3)		20	%		16	%		12	%		20	%(2)		17	%		25	%

Expense and net investment income ratios without the effect of the contractual expense cap were (note 3):

Ratio of expenses to average net assets		0.87	%(3)		0.87	%		0.91	%		0.91	%(4)		0.88	%(3)		0.88	%		0.87	%
Ratio of net investment income to
average net assets		2.51	% (3)		2.72	%		3.07	%		3.26	%(4)		3.23	%(3)		3.74	%		4.28	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.86% and 3.31%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

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AQUILA TAX-FREE FUND FOR UTAH

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class C
	Six Months															Year Ended
	Ended			Year			Year			Year			Nine Months			June 30,
	9/30/16 (unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.55		$	10.50		$	10.10		$	10.37		$	10.27		$	9.74		$	9.79
Income (loss) from investment operations:
Net investment income(1)		0.09			0.20			0.24			0.25			0.19			0.30			0.34
Net gain (loss) on securities (both
realized and unrealized)		0.07			0.06			0.41			(0.24	)		0.11			0.53			(0.04	)
Total from investment operations		0.16			0.26			0.65			0.01			0.30			0.83			0.30
Less distributions (note 9):
Dividends from net investment income		(0.09	)		(0.20	)		(0.24	)		(0.25	)		(0.20	)		(0.30	)		(0.35	)
Distributions from capital gains		–			(0.01	)		(0.01	)		(0.03	)		–			–			–
Total distributions		(0.09	)		(0.21	)		(0.25	)		(0.28	)		(0.20	)		(0.30	)		(0.35	)
Net asset value, end of period	$	10.62		$	10.55		$	10.50		$	10.10		$	10.37		$	10.27		$	9.74
Total return (not reflecting CDSC)		1.52	%(2)		2.55	%		6.49	%		0.15	%		2.86	%(2)		8.62	%		3.15	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	81		$	75		$	81		$	81		$	106		$	96		$	83
Ratio of expenses to average net assets		1.66	%(3)		1.64	%		1.63	%		1.63	%		1.63	%(3)		1.63	%		1.63	%
Ratio of net investment income to
average net assets		1.72	%(3)		1.95	%		2.34	%		2.53	%		2.47	%(3)		2.98	%		3.51	%
Portfolio turnover rate		7	% (2)		20	%		16	%		12	%		20	%(2)		17	%		25	%

Expense and net investment income ratios without the effect of the contractual expense cap were (note 3):

Ratio of expenses to average net assets		1.68	%(3)		1.67	%		1.71	%		1.70	%(4)		1.67	%(3)		1.68	%		1.67	%
Ratio of net investment income to
average net assets		1.70	% (3)		1.92	%		2.27	%		2.46	%(4)		2.42	%(3)		2.93	%		3.48	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 1.66% and 2.50%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

39 | Aquila Tax-Free Fund For Utah

AQUILA TAX-FREE FUND FOR UTAH

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class Y
	Six Months															Year Ended
	Ended			Year			Year			Year			Nine Months			June 30,
	9/30/16(unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.59		$	10.53		$	10.13		$	10.41		$	10.30		$	9.77		$	9.83
Income (loss) from investment operations:
Net investment income(1)		0.15			0.31			0.35			0.36			0.27			0.40			0.44
Net gain (loss) on securities (both
realized and unrealized)		0.06			0.06			0.40			(0.26	)		0.11			0.53			(0.05	)
Total from investment operations		0.21			0.37			0.75			0.10			0.38			0.93			0.39
Less distributions (note 9):
Dividends from net investment income		(0.14	)		(0.30	)		(0.34	)		(0.35	)		(0.27	)		(0.40	)		(0.45	)
Distributions from capital gains		–			(0.01	)		(0.01	)		(0.03	)		–			–			–
Total distributions		(0.14	)		(0.31	)		(0.35	)		(0.38	)		(0.27	)		(0.40	)		(0.45	)
Net asset value, end of period	$	10.66		$	10.59		$	10.53		$	10.13		$	10.41		$	10.30		$	9.77
Total return		2.03	%(2)		3.61	%		7.54	%		1.07	%		3.83	%(2)		9.69	%		4.08	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	128		$	112		$	100		$	71		$	88		$	76		$	56
Ratio of expenses to average net assets		0.64	%(3)		0.64	%		0.63	%		0.63	%		0.63	%(3)		0.63	%		0.63	%
Ratio of net investment income to
average net assets		2.74	%(3)		2.95	%		3.33	%		3.53	%		3.47	%(3)		3.98	%		4.51	%
Portfolio turnover rate		7	%(2)		20	%		16	%		12	%		20	%(2)		17	%		25	%

Expense and net investment income ratios without the effect of the contractual expense cap were (note 3):

Ratio of expenses to average net assets		0.67	%		0.67	%		0.70	%		0.70	%(4)		0.68	%(3)		0.68	%		0.67	%
Ratio of net investment income to
average net assets		2.71	%(3)		2.92	%		3.26	%		3.46	%(4)		3.43	%(3)		3.93	%		4.47	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Fund into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.66% and 3.50%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

40 | Aquila Tax-Free Fund For Utah

Analysis of Expenses (unaudited)

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including front-end sales charges with respect to Class A shares or contingent deferred sales charges (“CDSC”) with respect to Class C shares; and (2) ongoing costs, including management fees; distribution (“12b-1”) and/or service fees; and other Fund expenses. The table below is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The table below is based on an investment of $1,000 invested on April 1, 2016 and held for the six months ended September 30, 2016.

Actual Expenses

Six months ended September 30, 2016

	Actual
	Total Return	Beginning	Ending	Expenses
	Without	Account	Account	Paid During
	Sales Charges(1)	Value	Value	the Period(2)
Class A	1.92%	$1,000.00	$1,019.20	$4.30
Class C	1.52%	$1,000.00	$1,015.20	$8.39
Class Y	2.03%	$1,000.00	$1,020.30	$3.24

(1)

(2)	Expenses are equal to the annualized expense ratio of 0.85%, 1.66% and 0.64% for the Fund’s Class A, C and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

41 | Aquila Tax-Free Fund For Utah

Analysis of Expenses (unaudited) (continued)

Hypothetical Example for Comparison Purposes

Six months ended September 30, 2016

	Hypothetical
	Annualized	Beginning	Ending	Expenses
	Total	Account	Account	Paid During
	Return	Value	Value	the Period(1)
Class A	5.00%	$1,000.00	$1,020.81	$4.31
Class C	5.00%	$1,000.00	$1,016.75	$8.39
Class Y	5.00%	$1,000.00	$1,021.86	$3.24

(1)	Expenses are equal to the annualized expense ratio of 0.85%, 1.66% and 0.64% for the Fund’s Class A, C and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

42 | Aquila Tax-Free Fund For Utah

Information Available (unaudited)

Proxy Voting Record (unaudited)

Federal Tax Status of Distributions (unaudited)

This information is presented in order to comply with a requirement of the Internal Revenue Code. No action on the part of shareholders is required.

For the fiscal year ended March 31, 2016, $10,090,965 of dividends paid by Aquila Tax-Free Fund For Utah, constituting 97.4% of total dividends paid, were exempt-interest dividends; $226,111 of dividends paid by the Fund constituting 2.2% of total dividends paid were capital gains distributions; and the balance was ordinary income.

Prior to February 15, 2017, shareholders will be mailed the appropriate tax form(s) which will contain information on the status of distributions paid for the 2016 calendar year.

43 | Aquila Tax-Free Fund For Utah

Additional Information (unaudited)

Renewal of the Advisory and Administration Agreement

Aquila Investment Management LLC (the “Manager”) serves as the investment adviser to the Fund pursuant to an Advisory and Administration Agreement (the “Advisory Agreement”). In order for the Manager to remain the investment adviser of the Fund, the Trustees of the Fund must determine annually whether to renew the Advisory Agreement for the Fund.

The nature, extent, and quality of the services provided by the Manager

The Trustees reviewed the Manager’s investment approach for the Fund and its research process. The Trustees considered that the Manager had provided all advisory and administrative services to the Fund that the Trustees deemed necessary or appropriate, including the specific services that the Trustees have determined are required for the Fund, given that it seeks to provide shareholders with as high a level of current income exempt from Utah state and regular Federal income taxes as is consistent with preservation of capital. The Trustees considered the personnel of the Manager who provide investment management services to the Fund. The Manager has employed Mr. James Thompson and Mr. Todd Curtis as co-portfolio managers for the Fund and has established facilities and capabilities for credit analysis of the Fund’s portfolio securities. The Trustees noted the extensive experience of the co-portfolio managers. They considered that Mr. Thompson is based in Salt Lake City, Utah and that he has a comprehensive understanding regarding the economy of the State of Utah and the securities in which the Fund invests, including non-rated securities and those securities with less than the highest ratings from the rating agencies. The Trustees also noted that the Fund did not own any Puerto Rico municipal bonds during the review period.

44 | Aquila Tax-Free Fund For Utah

The Trustees considered the nature and extent of the Manager’s supervision of third-party service providers, including the Fund’s fund accountant, shareholder servicing agent and custodian.

The investment performance of the Fund

The Trustees reviewed the Fund’s performance (Class A shares) and compared its performance to the performance of:

•

the funds in the Fund’s peer group (the “Peer Group”), as selected by the independent consultant (four single-state intermediate and single-state long municipal bond funds, as classified by Morningstar, that are similar to the Fund in size and that charge a front-end sales charge);

•

the funds in the Fund’s product category for performance (the “ProductCategory for Performance”) (all funds in the Peer Group and, without duplication, all funds (and all classes) included in the Morningstar Single-State Intermediate Municipal Bond Funds category); and

•

the Fund’s benchmark index, the Barclays Capital Quality Intermediate Municipal Bond Index.

The Trustees considered that the materials included in the Consultant’s Report indicated that the Fund’s average annual total return was higher than the average annual total return of the funds in the Peer Group and the funds in the Product Category for Performance, in each case for the one, three, five and ten--year periods ended June 30, 2016. They also considered that the Fund’s average annual total return was higher than the average annual total return of the benchmark index for each of those periods. The Trustees further considered that, as reflected in the Consultant’s Report, the Fund delivered above-average results on a risk-adjusted basis for the three and five-year periods ended June 30, 2016 (as evidenced by its Sharpe ratio) when compared to the funds in the Product Category for Performance. The Trustees noted that the Fund was the only Utah state-specific tax-free municipal bond fund. The Trustees also noted that, unlike the Fund’s returns, the performance of the benchmark index did not reflect any fees or expenses.

45 | Aquila Tax-Free Fund For Utah

Advisory Fees and Fund Expenses

The Trustees reviewed the Fund’s advisory fees and expenses and compared them to the advisory fee and expense data for:

•

the funds in the Peer Group (as defined above); and

•

the funds in the product category for expenses (the “Product Category for Expenses”) (Morningstar Single-State Intermediate Municipal Bond Funds and Morningstar Single State Long Municipal Bond Funds from states within which 1-3 mutual funds are operating, with similar operating expense structures).

The Trustees considered that the Fund’s contractual advisory fee was less than the average contractual advisory fee, and equal to the median contractual advisory fee, of the funds in the Peer Group (at the Fund’s current asset level). They also considered that the Fund’s contractual advisory fee was lower than the asset-weighted average contractual advisory fee of the funds in the Product Category for Expenses at the Fund’s current asset level and up to $1 billion in assets.

The Trustees noted that the Fund’s actual management fee (after giving effect to the fee waiver) was higher than the average actual management fee of the funds in both the Product Category for Expenses and the Peer Group (after giving effect to fee waivers in effect for those funds). They noted, however, that the Fund’s actual expenses (for Class A shares), after giving effect to fee waivers and expense reimbursements, were lower than the average actual expenses of the funds in the Product Category for Expenses and only 0.002% higher than the average actual expenses of the funds in the Peer Group (after giving effect to fee waivers and expense reimbursements in effect for those funds).

The Trustees reviewed management fees charged by the Manager to its other clients. It was noted that the Manager does not have any other clients except for other funds in the Aquila Group of Funds. The Trustees noted that, in most instances, the fee rates for those clients were comparable to the fees paid to the Manager with respect to the Fund. In evaluating the fees associated with the other funds, the Trustees took into account the respective demands, resources and complexity associated with the Fund and those funds.

The Trustees considered that the Manager was currently waiving a portion of its fees and had been since the Fund’s inception. Additionally, it was noted that the Manager had indicated that it intended to continue waiving fees as necessary for the Fund to remain competitive. The Trustees concluded that the advisory fee was reasonable in relation to the nature and quality of the services provided by the Manager to the Fund.

Profitability

46 | Aquila Tax-Free Fund For Utah

The extent to which economies of scale would be realized as the Fund grows

The Trustees considered the extent to which the Manager may realize economies of scale or other efficiencies in managing the Fund. The Trustees noted that the Manager continued to waive a portion of its fees and had been since the Fund’s inception. The Trustees noted that the Manager’s profitability also may be an indicator of the availability of any economies of scale. Accordingly, the Trustees concluded that economies of scale, if any, were being appropriately shared with the Fund.

Benefits derived or to be derived by the Manager and its affiliate from the relationship with the Fund

47 | Aquila Tax-Free Fund For Utah

(THIS PAGE INTENTIONALLY LEFT BLANK)

Founders

Lacy B. Herrmann (1929-2012)

Aquila Management Corporation, Sponsor

Manager

AQUILA INVESTMENT MANAGEMENT LLC

120 West 45th Street, Suite 3600

New York, New York 10036

Board of Trustees

John C. Lucking, Chair

Diana P. Herrmann, Vice Chair

Ernest Calderón

Thomas A. Christopher

Gary C. Cornia

Grady Gammage, Jr.

Glenn P. O’Flaherty

James R. Ramsey

Laureen L. White

Officers

Diana P. Herrmann, President

Charles E. Childs, III, Executive Vice President

and Secretary

Marie E. Aro, Senior Vice President

Paul G. O’Brien, Senior Vice President

Todd W. Curtis, Senior Vice President

and Co-Portfolio Manager

James T. Thompson, Vice President

and Co-Portfolio Manager

M. Kayleen Willis, Vice President

Randall S. Fillmore, Chief Compliance Officer

Joseph P. DiMaggio, Chief Financial Officer

and Treasurer

Distributor

AQUILA DISTRIBUTORS LLC

120 West 45th Street, Suite 3600

New York, New York 10036

Transfer and Shareholder Servicing Agent

BNY MELLON INVESTMENT SERVICING (US) INC.

4400 Computer Drive

Westborough, Massachusetts 01581

Custodian

THE BANK OF NEW YORK MELLON

225 Liberty Street

New York, New York 10286

Further information is contained in the Prospectus,

which must precede or accompany this report.

Semi-Annual

Report

September 30, 2016

Please plan to join us for your 2017 shareholder meeting.

Details will be available on our website as the date approaches:

www.aquilafunds.com

or through your financial professional.

Aquila Tax-Free

Trust of Arizona

“The Role of Trustees”

Serving Arizona investors since 1986

November, 2016

Dear Fellow Shareholder:

Under applicable state law, Trustees are charged, as their primary responsibility, with safeguarding the interests of shareholders. As such, your Trustees seek to act in your best interests, putting your interests ahead of their own interests and those of anyone else, in overseeing the policies and procedures of Aquila Tax-Free Trust of Arizona (your “Fund”), as well as the services provided by your Fund’s key service providers.

Selection and nomination of independent Trustees is by the existing independent Trustees. As detailed in the Nominating Committee Charter which is available on your Fund’s website (www.aquilafunds.com), your Board of Trustees seeks to develop and maintain a board of high quality, independence and integrity to best serve your interests. The Trustees associated with the Aquila Group of Funds are additionally selected on the basis of being accomplished individuals of diverse backgrounds from various parts of the United States, including Arizona. Through this diversity, we strive to provide your Fund with a broad breadth and balance of knowledge and experience. Biographical and other information on your Board of Trustees is available on our website and, by law, is included in your Fund’s annual report and Statement of Additional Information.

NOT A PART OF THE SEMI- ANNUAL REPORT

Although, not required, Trustees in the Aquila Group of Funds self-impose some additional criteria.

•

In addition to overseeing your Fund, all Trustees are also fellow shareholders. While Trustees, like any investor, must consider, among other things, their own personal investment objectives (including tax benefits afforded the investment by their state of residence) when deciding upon the size of their investment in Aquila Tax-Free Trust of Arizona, we believe it is important that each Trustee has “some skin the game.”

•

Consideration is given to including local residents as Trustees. In this way, the Fund can benefit from their hands-on insight and knowledge of their State.

In short, your Board of Trustees are your “watchdogs,” looking over operations of Aquila Tax-Free Trust of Arizona.

It has been our experience that those who have undertaken to serve as Trustees diligently devote their energies, talents and experience to furthering the interests of you, our shareholders.

Sincerely,

Diana P. Herrmann, Vice Chair and President

NOT A PART OF THE SEMI- ANNUAL REPORT

Mutual fund investing involves risk and loss of principal is possible.

Investments in the Fund are subject to possible loss due to the financial failure of the issuers of underlying securities and their inability to meet their debt obligations.

A portion of income may be subject to local, state, Federal and/or alternative minimum tax. Capital gains, if any, are subject to capital gains tax.

These risks may result in share price volatility.

Past performance is no guarantee of future results, and there is no guarantee that any market forecasts discussed will be realized.

NOT A PART OF THE SEMI- ANNUAL REPORT

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE SCHEDULE OF INVESTMENTS(continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		General Obligation Bonds (18.8%)	and Fitch	Value

		City (7.1%)
		Buckeye Jackrabbit Trail Sanitary Sewer
		Improvement District
$	1,320,000	6.250%, 01/01/29	NR/A-/NR	$	1,519,280
		Casa Grande, Arizona
	800,000	4.000%, 08/01/34	NR/AA-/AA		898,728
		Chandler, Arizona
	1,500,000	4.000%, 07/01/25	Aaa/AAA/AAA		1,756,275
	1,000,000	5.000%, 07/01/26	Aaa/AAA/AAA		1,258,970
		Flagstaff, Arizona
	200,000	4.000%, 07/01/35	Aa2/AA/NR		222,490
		Flagstaff Improvement District
		(Aspen Place Sawmill)
	360,000	5.000%, 01/01/32	Aa3/NR/NR		360,594
		Gilbert Improvement District No. 19
	25,000	5.200%, 01/01/23	Aa1/A+/NR		25,063
		Gilbert Improvement District No. 20
	635,000	5.100%, 01/01/29	Aa1/A+/NR		697,541
		Goodyear, Arizona Refunding
	1,000,000	5.000%, 07/01/29	Aa2/AA/NR		1,102,070
		Goodyear McDowell Road Commercial
		Corridor Improvement District
	3,000,000	5.250%, 01/01/32 AMBAC Insured	A1/A/NR		3,029,490
		Phoenix, Arizona
	1,240,000	6.250%, 07/01/17	Aa1/AA+/NR		1,289,860
		Queen Creek Improvement District
		No. 1
	1,280,000	5.000%, 01/01/26	A3/A-/A-		1,285,939
	1,280,000	5.000%, 01/01/32	A3/A-/A-		1,284,531
		Scottsdale, Arizona
	200,000	4.000%, 07/01/28	Aaa/AAA/AAA		233,316
		Tempe, Arizona
	2,245,000	4.000%, 07/01/22	Aa1/AAA/AAA		2,475,000
	1,000,000	4.000%, 07/01/24	Aa1/AAA/AAA		1,187,630
	1,000,000	4.000%, 07/01/29	Aa1/AAA/AAA		1,158,890
		Tempe Improvement District
		(Pier Town Lake)
	2,000,000	5.000%, 01/01/29	Aa3/NR/NR		2,093,900

1 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		General Obligation Bonds (continued)	and Fitch	Value

		City (continued)
		Tubac Fire District
$	760,000	5.500%, 07/01/28 AGC Insured	A1/NR/NR	$	846,252
		Total City			22,725,819

		County (0.4%)
		Yuma Co. Free Library District
	1,000,000	4.000%, 07/01/29	Aa3/NR/AA+		1,126,270

		School District (11.3%)
		Buckeye Union High School District
		No. 201
	1,000,000	5.000%, 07/01/33 AGMC Insured	NR/AA/NR		1,188,220
		Gila Co. Unified School District
		No. 10 (Payson)
	350,000	5.000%, 07/01/26	Aa3/NR/NR		432,555
	1,000,000	5.000%, 07/01/28	Aa3/NR/NR		1,221,290
		Glendale Union High School District
		No. 205
	525,000	5.000%, 07/01/27 BAMAC Insured	NR/AA/NR		630,047
	980,000	4.000%, 07/01/32 BAMAC Insured	NR/AA/NR		1,093,768
		Maricopa Co. Elementary School
		District No. 3 (Tempe)
	250,000	4.000%, 07/01/25	Aa2/NR/NR		295,838
		Maricopa Co. Elementary School
		District No. 8 (Osborn)
	920,000	6.250%, 07/01/22	NR/A/NR		950,314
		Maricopa Co. Elementary School
		District No. 28 (Kyrene Elementary)
	250,000	5.500%, 07/01/30	Aa1/AA/NR		312,045
	350,000	5.000%, 07/01/34	Aa1/AA/NR		419,205
		Maricopa Co. High School District
		No. 210 (Phoenix)
	500,000	4.000%, 07/01/26	Aa2/AA/NR		582,415
		Maricopa Co. Unified School District
		No. 11 (Peoria)
	1,500,000	4.000%, 07/01/25	A2/AA-/NR		1,696,620
	2,000,000	4.000%, 07/01/35	NR/AA-/NR		2,239,480
	675,000	4.500%, 07/01/33 AGMC Insured	A2/AA/NR		786,706

2 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		General Obligation Bonds (continued)	and Fitch	Value

		School District (continued)
		Maricopa Co. Unified School District
		No. 24 (Gila Bend)
$	305,000	5.500%, 07/01/22	NR/NR/NR*	$	309,075
		Maricopa Co. Unified School District
		No. 48 (Scottsdale)
	1,500,000	4.750%, 07/01/30	Aa1/AA/NR		1,716,255
		Maricopa Co. Unified School District
		No. 60 (Higley)
	1,000,000	5.000%, 07/01/24 AGMC Insured	A1/AA/NR		1,244,060
	1,615,000	5.000%, 07/01/29	A1/A+/NR		1,942,764
		Maricopa Co. Unified School District
		No. 69 (Paradise Valley)
	1,000,000	4.500%, 07/01/30	Aa2/NR/AA		1,165,080
		Maricopa Co. Unified School District
		No. 80 (Chandler)
	525,000	4.000%, 07/01/33	Aa1/AA/NR		591,712
		Maricopa Co. Unified School District
		No. 89 (Dysart)
	2,185,000	5.500%, 07/01/22 NPFG/FGIC Insured	A3/AA-/NR		2,684,076
	500,000	4.000%, 07/01/28	NR/A+/AA-		565,610
		Maricopa Co. Unified School District
		No. 90 (Saddle Mountain)
	1,300,000	5.125%, 07/01/25 AGMC Insured	A2/AA/NR		1,499,303
		Mohave Co. Unified School District
		No. 20 (Kingman)
	1,000,000	5.000%, 07/01/26 BAMAC Insured	A2/AA/NR		1,236,310
		Navajo Co. Unified School District
		No. 2 (Joseph City)
	1,250,000	5.000%, 07/01/18	A2/NR/NR		1,310,312
		Pima Co. Unified School District
		No. 6 (Marana)
	1,250,000	5.000%, 07/01/25	NR/A+/NR		1,446,900
	950,000	5.250%, 07/01/25 AGMC Insured	NR/AA/NR		1,140,541
	1,000,000	4.250%, 07/01/32 MAC Insured	NR/AA/NR		1,136,580
		Pima Co. Unified School District
		No. 10 (Amphitheater)
	700,000	5.000%, 07/01/27	Aa2/A+/NR		807,835

3 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		General Obligation Bonds (continued)	and Fitch	Value

		School District (continued)
		Pima Co. Unified School District
		No. 12 (Sunnyside)
$	1,050,000	4.000%, 07/01/28 BAMAC Insured	NR/AA/NR	$	1,167,747
		Pinal Co. Elementary School District
		No. 4 (Casa Grande)
	925,000	4.250%, 07/01/18 AGMC Insured	A1/AA/NR		975,690
		Pinal Co. Unified School District
		No. 21 (Coolidge)
	500,000	4.000%, 07/01/28 AGMC Insured	NR/AA/NR		578,495
		Tempe High School District No. 213
	650,000	4.000%, 07/01/32	Aa2/AA/NR		720,310
		Western Maricopa Education Center
		District No. 402
	1,200,000	4.000%, 07/01/28	NR/AA-/NR		1,348,968
		Yavapai Co. Elementary School District
		No. 6 (Cottonwood-Oak Creek)
	720,000	5.000%, 07/01/34 BAMAC Insured	A2/AA/NR		848,729
		Total School District			36,284,855
		Total General Obligation Bonds			60,136,944

		Revenue Bonds (63.0%)

		Airport (3.3%)
		Phoenix Civic Improvement Corp.
		Airport Bonds
	1,000,000	5.250%, 07/01/18 AMT	Aa3/AA-/NR		1,073,430
	1,000,000	5.250%, 07/01/19 AMT	Aa3/AA-/NR		1,070,010
	2,700,000	5.000%, 07/01/32 AMT	Aa3/AA-/NR		3,148,929
	1,000,000	5.250%, 07/01/33	A1/A+/NR		1,135,440
	1,200,000	5.000%, 07/01/33	Aa3/AA-/NR		1,275,852
	1,250,000	5.000%, 07/01/34	A1/A+/NR		1,500,425
	1,000,000	5.000%, 07/01/45	A1/A+/NR		1,180,500
		Total Airport			10,384,586

		Charter Schools (0.3%)
		Phoenix Industrial Development Authority
		(Great Hearts Academies Project)
	500,000	5.000%, 07/01/41	NR/BBB-/NR		568,930

4 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Charter Schools (continued)
		Phoenix Industrial Development Authority
		(Villa Montessori Inc. Project)
$	415,000	5.000%, 07/01/35	NR/BBB-/NR	$	452,682
		Total Charter Schools			1,021,612

		Excise Tax (12.1%)
		Buckeye Excise Tax
	400,000	4.000%, 07/01/36	NR/AA-/AA-		434,960
	1,000,000	5.000%, 07/01/43	NR/AA-/AA-		1,161,040
		Casa Grande Excise Tax
	1,435,000	5.000%, 04/01/28	NR/AA/AA		1,573,521
		Cottonwood Pledged Revenue
		Obligations
	500,000	4.000%, 07/01/27 BAMAC Insured	NR/AA/NR		587,595
	500,000	5.000%, 07/01/30 AGMC Insured	NR/AA/NR		615,650
		El Mirage Pledged Excise Tax
	500,000	5.000%, 07/01/30	A2/AA-/NR		565,920
		Flagstaff Pledged Revenue
	200,000	4.000%, 07/01/31	NR/AA-/NR		224,864
		Gilbert Pledged Revenue Obligations
	450,000	4.000%, 07/01/35	Aa2/AA+/AA+		491,954
		Gilbert Public Facilities Municipal
		Property Corp.
	850,000	5.000%, 07/01/23	Aa1/AA+/NR		942,837
	1,250,000	5.000%, 07/01/24	Aa1/AA+/NR		1,386,175
		Glendale Senior Excise Tax
	1,000,000	5.000%, 07/01/32	A2/AA+/NR		1,220,680
		Goodyear Public Improvement Corp.
	1,500,000	5.000%, 07/01/26	Aa3/AA-/NR		1,781,265
	1,310,000	6.000%, 07/01/31	Aa3/AA-/NR		1,421,900
		Graham Co. Jail District Revenue
		Pledged Obligation
	1,000,000	5.000%, 07/01/35	NR/A-/NR		1,131,340
		Marana Pledged Excise Tax
	275,000	4.000%, 07/01/30	NR/AA/NR		300,251
	1,400,000	5.000%, 07/01/33	NR/AA/NR		1,676,192
		Page Pledged Revenue Refunding
	1,080,000	5.000%, 07/01/25	NR/AA-/NR		1,255,489

5 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Excise Tax (continued)
		Phoenix Civic Improvement Corp.
		(Civic Plaza)
$	2,000,000	5.500%, 07/01/27 BHAC/FGIC Insured	Aa1/AA+/NR	$	2,652,920
	2,000,000	5.500%, 07/01/30 BHAC/FGIC Insured	Aa1/AA+/NR		2,733,160
	1,000,000	5.500%, 07/01/23 NPFG/FGIC Insured	Aa2/AA/NR		1,235,220
	2,300,000	5.500%, 07/01/33 NPFG/FGIC Insured	Aa2/AA/NR		3,189,065
		Phoenix Civic Improvement Corp.
		Transit Excise Tax (Light Rail)
	2,000,000	4.000%, 07/01/20	Aa2/AA/NR		2,218,080
		Pinal Co. Revenue Obligations Refunding
	1,755,000	4.000%, 08/01/17	NR/AA/NR		1,800,911
	1,500,000	5.000%, 08/01/33	NR/AA-/AA		1,786,005
		Queen Creek Excise Tax & State
		Shared Revenue
	1,250,000	5.000%, 08/01/31	NR/AA/AA		1,547,650
	1,000,000	5.000%, 08/01/32	NR/AA/AA		1,233,170
		Scottsdale Municipal Property Corp.
	1,500,000	5.000%, 07/01/34	Aaa1/AAA/AAA		1,824,225
		Show Low Improvement District No. 6
	250,000	6.000%, 01/01/18 ACA Insured	NR/NR/NR*		250,900
		Tempe Excise Tax
	245,000	5.000%, 07/01/30	Aa2/AAA/NR		308,259
	1,000,000	5.000%, 07/01/33	Aa2/AAA/NR		1,064,470
		Total Excise Tax			38,615,668

		Higher Education (8.4%)
		Arizona Board of Regents - Arizona State
		University System
	300,000	5.000%, 07/01/28	Aa3/AA/NR		377,298
	300,000	5.000%, 07/01/29	Aa3/AA/NR		375,096
	200,000	5.000%, 07/01/30	Aa3/AA/NR		248,788
	480,000	5.000%, 07/01/31	Aa3/AA/NR		592,315
	1,000,000	5.000%, 07/01/32	Aa3/AA/NR		1,179,690
	1,000,000	5.000%, 07/01/32	Aa3/AA/NR		1,179,690
	1,000,000	5.000%, 07/01/38	Aa3/AA/NR		1,216,810
	200,000	5.000%, 07/01/41	Aa3/AA/NR		239,720

6 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Higher Education (continued)
		Arizona Board of Regents -
		Northern Arizona University System
$	575,000	5.000%, 06/01/32	A1/A+/NR	$	693,697
	250,000	5.000%, 06/01/38	A1/A+/NR		303,312
	1,000,000	5.000%, 06/01/31 BAMAC Insured	A1/AA/NR		1,205,560
	1,000,000	5.000%, 06/01/36 BAMAC Insured	A1/AA/NR		1,181,510
	1,115,000	5.000%, 06/01/22 NPFG/FGIC Insured	A1/AA-/NR		1,143,533
		Arizona Board of Regents -
		University of Arizona System Speed
		Stimulus Plan for Economic &
		Educational Development
	500,000	5.000%, 08/01/27	Aa3/A+/NR		621,605
	1,500,000	5.000%, 08/01/34	Aa3/A+/NR		1,796,685
		Arizona Board of Regents
		(University of Arizona System)
	400,000	5.000%, 06/01/29	Aa2/AA-/NR		487,632
	460,000	5.000%, 06/01/31	Aa2/AA-/NR		548,076
	1,215,000	5.000%, 06/01/33	Aa2/AA-/NR		1,515,445
	2,000,000	5.000%, 06/01/38	Aa2/AA-/NR		2,459,280
		Arizona State University Speed Stimulus
		Plan for Economic & Educational
		Development
	625,000	5.000%, 08/01/34	A1/AA-/NR		733,431
		Cochise Co. Community College
		District
	630,000	5.000%, 07/01/31 BAMAC Insured	A2/AA/NR		751,836
		Glendale Industrial Development
		Authority (Midwestern University)
	600,000	5.000%, 05/15/35	NR/A/A+		667,716
		McAllister Academic Village (Arizona
		State University Hassayampa)
	500,000	5.000%, 07/01/38	A1/AA-/NR		604,075
		Northern Arizona University Speed
		Stimulus Plan for Economic &
		Educational Development
	1,445,000	5.000%, 08/01/38	A2/A/NR		1,681,070
		Phoenix Industrial Development Authority
		(Eastern Kentucky University Project)
	500,000	5.000%, 10/01/36	A2/A-/NR		585,290

7 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)


			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Higher Education (continued)
		Phoenix Industrial Development Authority
		(Rowan University Project)
$	2,000,000	5.250%, 06/01/34	A3/A/NR	$	2,348,240
		Yavapai Co. Community College District
	1,000,000	4.875%, 07/01/25 AGMC Insured	A1/AA/NR		1,141,990
		Yuma/ La Paz Counties Community
		College District (Arizona Western
		College), Refunding
	1,000,000	4.000%, 07/01/28 2014A	Aa3/A+/NR		1,119,110
		Total Higher Education			26,998,500

		Hospital (11.8%)
		Arizona Health Facilities Authority
		(Banner Health)
	300,000	5.125%, 01/01/29	NR/AA-/AA-		315,462
	3,100,000	5.375%, 01/01/32	NR/AA-/AA-		3,268,113
	1,750,000	5.000%, 01/01/43	NR/AA-/AA-		1,998,605
	3,500,000	5.000%, 01/01/44	NR/AA-/AA-		4,083,555
		Arizona Health Facilities Authority
		(Dignity Health)
	1,500,000	5.000%, 07/01/28	A3/A/A		1,647,555
	2,000,000	5.250%, 03/01/39	A3/A/A		2,236,020
		Arizona Health Facilities Authority
		(Phoenix Children’s Hospital)
	2,950,000	5.000%, 02/01/34	NR/BBB+/NR		3,349,932
		Arizona Health Facilities Authority
		(Scottsdale Lincoln Hospitals)
	3,000,000	5.000%, 12/01/34	A2/NR/A		3,564,750
	435,000	5.000%, 12/01/39	A2/NR/A		511,612
	3,500,000	5.000%, 12/01/42	A2/NR/A		4,107,985
		Arizona Health Facilities Authority
		(Yavapai Regional Medical Center)
	1,500,000	5.375%, 12/01/30 AGMC Insured	A2/NR/NR		1,704,330
		Maricopa Co. Industrial Development
		Authority (Dignity Health)
	3,000,000	5.250%, 07/01/32	A3/A/A		3,096,300
		Scottsdale Industrial Development
		Authority (Scottsdale Healthcare System)
	1,000,000	5.000%, 09/01/18	A2/NR/A		1,074,120

8 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Hospital (continued)
		Authority (Scottsdale Healthcare System)
		(continued)
$	750,000	5.000%, 09/01/35 AGMC Insured	A2/AA/A	$	841,620
		Yavapai Co. Industrial Development
		Authority (Northern Arizona Healthcare
		System)
	500,000	5.250%, 10/01/25	NR/AA/NR		591,650
	500,000	5.250%, 10/01/26	NR/AA/NR		590,860
		Yavapai Co. Industrial Development
		Authority (Yavapai Regional
		Medical Center)
	1,000,000	5.250%, 08/01/33	Baa1/NR/BBB+		1,145,140
	1,250,000	5.625%, 08/01/37	Baa1/NR/BBB+		1,321,175
		Yuma Industrial Development Authority
		(Yuma Regional Medical Center)
	1,635,000	5.000%, 08/01/23	NR/A-/NR		1,939,437
	200,000	5.000%, 08/01/32	NR/A-/NR		232,386
		Total Hospital			37,620,607

		Lease (4.0%)
		Arizona Board of Regents
		Northern Arizona University COP
	600,000	5.000%, 09/01/27	A2/A/NR		706,368
	500,000	5.000%, 09/01/28	A2/A/NR		587,110
	1,000,000	5.000%, 09/01/29	A2/A/NR		1,171,770
		Arizona State Lottery Bonds
	3,000,000	5.000%, 07/01/28 AGMC Insured	A1/AA/NR		3,331,680
		Cave Creek COP
	245,000	5.750%, 07/01/19	NR/AA/NR		247,999
		Mohave Co. Industrial Development
		Authority Correctional Facilities
	1,000,000	8.000%, 05/01/25	NR/BBB+/NR		1,005,160
		Nogales, Arizona Municipal
		Development Authority
	500,000	4.000%, 06/01/36	NR/AA/NR		543,815
		Pinal Co. Correctional Facilities
	1,470,000	5.250%, 10/01/21 ACA Insured	NR/BBB/NR		1,473,219

9 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Lease (continued)
		Prescott Municipal Property Corp.
$	500,000	5.000%, 07/01/34	Aa3/AA/NR	$	592,460
		State of Arizona COP Department
		Administration
	1,500,000	5.250%, 10/01/26 AGMC Insured	Aa3/AA/NR		1,682,535
	670,000	5.250%, 10/01/28 AGMC Insured	Aa3/AA/NR		751,110
		State of Arizona COP
	500,000	5.000%, 09/01/27	Aa3/AA-/NR		619,495
		Total Lease			12,712,721

		Mortgage (2.2%)
		Festival Ranch Community Facilities
		District
	1,000,000	4.000%, 07/15/36 BAMAC Insured	NR/AA/NR		1,089,480
		Goodyear Community Facilities
		Utilities District No. 1
	500,000	4.000%, 07/15/28	A1/A-/NR		556,065
	500,000	4.000%, 07/15/32	A1/A-/NR		550,095
		Marley Park Community Facilities District
	535,000	4.000%, 07/15/34 BAMAC Insured†††	NR/AA/NR		583,332
		Merrill Ranch Community Facilities
		District #2
	680,000	6.750%, 07/15/38	NR/BBB-/NR		813,634
		Scottsdale Waterfront Community
		Facilities District
	530,000	6.000%, 07/15/27 144A	NR/NR/NR*		532,539
	930,000	6.050%, 07/15/32 144A	NR/NR/NR*		933,683
		Sundance Community Facilities District
	655,000	5.125%, 07/15/30	A3/BBB/NR		655,517
		Verrado Community Facilities Utilities
		District No. 1
	500,000	6.000%, 07/15/33 144A	NR/NR/NR*		559,135
		Vistancia Community Facilities District
	540,000	5.000%, 07/15/26	A1/NR/A-		618,575
		Total Mortgage			6,892,055

10 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Pollution Control (2.5%)
		Apache Co. Industrial Development
		Authority, Pollution Control, Tucson
		Electric Power Co.
$	2,700,000	4.500%, 03/01/30	A3/BBB+/NR	$	3,020,652
		Coconino Co. Pollution Control, Tucson
		Electric Power Co.
	2,000,000	5.125%, 10/01/32	A3/BBB+/NR		2,190,220
		Maricopa Co. Pollution Control
		(Southern California Edison Co.)
	1,000,000	5.000%, 06/01/35	Aa3/A/NR		1,121,370
		Phoenix Industrial Development Authority
		Solid Waste Disposal (Vieste Project)
	400,000	4.500%, 04/01/33 AMT***	NR/D/NR		120,000
		Pima Co. Industrial Development Authority,
		Pollution Control,
		Tucson Electric Power Co.
	1,500,000	4.950%, 10/01/20	A3/BBB+/NR		1,678,620
		Total Pollution Control			8,130,862

		Transportation (3.3%)
		Arizona State Transportation Board Excise
		Tax Revenue (Maricopa Co. Regional
		Area Road Fund)
	500,000	5.000%, 07/01/25	Aa1/AA+/NR		626,990
		Arizona Transportation Board Revenue
	1,675,000	5.000%, 07/01/28	Aa1/AAA/NR		2,099,026
	4,800,000	5.000%, 07/01/33	Aa1/AAA/NR		5,897,088
	1,000,000	5.000%, 07/01/36†††	Aa1/AAA/NR		1,235,270
		Pima Co. Regional Transportation Authority
		Excise Tax
	500,000	5.000%, 06/01/26	NR/AA+/AA		609,380
		Total Transportation			10,467,754

		Utility (9.7%)
		Arizona Power Authority
		(Hoover Dam Project)
	3,500,000	5.250%, 10/01/16	Aa2/AA/NR		3,500,000
	1,220,000	5.250%, 10/01/17	Aa2/AA/NR		1,273,241

11 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Utility (continued)
		Central Arizona Water Conservation
		District Water Delivery
		(Central Arizona Project)
$	750,000	5.000%, 01/01/33	Aa2/AA+/AA	$	927,510
	750,000	5.000%, 01/01/34	Aa2/AA+/AA		923,978
		Greater Arizona Development
		Authority Revenue
	505,000	5.000%, 08/01/22 NPFG Insured	A1/AA-/NR		506,596
	700,000	5.000%, 08/01/24	NR/A/NR		747,663
	500,000	5.000%, 08/01/28 AGMC Insured	A1/AA/NR		592,700
	1,200,000	5.500%, 08/01/29	A1/A/NR		1,200,000
	1,200,000	5.000%, 08/01/29	A1/A/NR		1,316,664
		Mesa Utility System
	250,000	4.000%, 07/01/32	Aa2/AA-/NR		284,315
	2,100,000	5.000%, 07/01/35	Aa2/AA-/NR		2,418,318
		Pinal Co. Electrical District No. 3,
		Electrical System Revenue Refunding
	250,000	5.250%, 07/01/36	NR/A/NR		288,387
		Salt River Project Agricultural
		Improvement and Power Revenue
	910,000	5.000%, 01/01/25	Aa1/AA/NR		957,129
	1,500,000	5.000%, 12/01/28	Aa1/AA/NR		1,772,580
	5,000,000	5.000%, 12/01/31	Aa1/AA/NR		5,996,450
	1,975,000	5.000%, 01/01/33	Aa1/AA/NR		2,073,513
	1,105,000	5.000%, 12/01/36	Aa1/AA/NR		1,345,658
	1,000,000	5.000%, 12/01/45	Aa1/AA/NR		1,206,430
		Salt Verde Finance Corp. Gas Revenue
	3,000,000	5.250%, 12/01/28	Baa1/BBB+/NR		3,749,220
		Total Utility			31,080,352

		Water/Sewer (5.4%)
		Avondale Water & Sewer Revenue
	565,000	4.000%, 07/01/36	Aa2/AA/NR		628,026
		Gilbert Water Resource Municipal
		Property Corp.
	820,000	4.000%, 07/01/35	NR/AAA/AA+		922,697
		Glendale Water & Sewer Revenue
	2,000,000	5.000%, 07/01/28	A1/AA/NR		2,457,220
	500,000	5.000%, 07/01/28	A1/AA/NR		598,915

12 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)


			Rating
Principal			Moody’s, S&P
Amount		Revenue Bonds (continued)	and Fitch	Value

		Water/Sewer (continued)
		Goodyear Water and Sewer Revenue
$	1,750,000	5.375%, 07/01/30	A2/A+/NR	$	1,996,313
	635,000	5.250%, 07/01/31 AGMC Insured	A2/AA/NR		736,575
	500,000	5.000%, 07/01/35 AGMC Insured	A2/AA/NR		606,955
	775,000	5.000%, 07/01/45 AGMC Insured	A2/AA/NR		927,458
		Lake Havasu City Wastewater
		System Revenue
	1,075,000	5.000%, 07/01/33 AGMC Insured	Aa3/AA/NR		1,305,459
	1,000,000	5.000%, 07/01/43 AGMC Insured	A2/AA/NR		1,187,350
		Phoenix Civic Improvement Corp.
		Wastewater Revenue
	1,500,000	5.500%, 07/01/24 NPFG/FGIC Insured	Aa2/AAA/NR		1,961,085
	500,000	5.000%, 07/01/37 NPFG Insured	Aa2/AA+/NR		513,965
		Tucson Water Revenue System
	1,000,000	5.000%, 07/01/32	Aa2/AA/AA		1,226,820
		Yuma Municipal Property Corp.
		Utility System
	1,700,000	5.000%, 07/01/28	A1/A+/AA-		2,087,107
		Total Water/Sewer			17,155,945
		Total Revenue Bonds			201,080,662

		Pre-Refunded\Escrowed to
		Maturity Bonds (17.8%)††
		Pre-Refunded General
		Obligation Bonds (4.4%)
		City (0.3%)
		Tempe, Arizona
	1,000,000	4.500%, 07/01/24	Aa1/AAA/AAA		1,027,420

		County (0.7%)
		Maricopa Co. Community College
		District
	2,000,000	4.000%, 07/01/21	Aaa/AAA/AAA		2,167,900

		School District (3.4%)
		Coconino & Yavapai Counties Joint
		Unified School District No. 9 Sedona
	1,000,000	5.375%, 07/01/28	Aa2/A+/NR		1,119,630

13 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)


			Rating
Principal			Moody’s, S&P
Amount		Pre-Refunded\ Escrowed to Maturity Bonds (continued)	and Fitch	Value

		School District (continued)
		Gila Co. Unified School District
		No. 10 (Payson)
$	400,000	5.250%, 07/01/27 AMBAC Insured	Aa3/NR/NR	$	413,020
	1,000,000	5.750%, 07/01/28	Aa3/NR/NR		1,083,840
		Maricopa Co. Unified School District
		No. 89 (Dysart)
	1,500,000	6.000%, 07/01/28	NR/A+/NR		1,630,845
		Maricopa Co. Unified School District
		No. 95 (Queen Creek)
	500,000	5.000%, 07/01/27 AGMC Insured	Aa3/NR/NR		535,465
		Mohave Co. Unified School District
		No. 20 (Kingman)
	1,175,000	5.250%, 07/01/24 AGMC Insured	A2/AA/NR		1,262,338
		Pima Co. Unified School District No. 1
		(Tucson)
	1,500,000	5.000%, 07/01/27 AGMC Insured	Aa3/AA/NR		1,606,395
		Pima Co. Unified School District
		No. 8 (Flowing Wells)
	1,000,000	5.375%, 07/01/29	NR/A+/NR		1,160,150
		Pinal Co. High School District
		No. 82 (Casa Grande)
	640,000	5.000%, 07/01/24	NR/A+/NR		684,819
		Pinal Co. Unified School District
		No. 1 (Florence)
	1,500,000	5.000%, 07/01/27 NPFG/FGIC
		Insured	A3/AA-/NR		1,546,080
		Total School District			11,042,582
		Total Pre-Refunded General
		Obligation Bonds			14,237,902

		Pre-Refunded\Escrowed to
		Maturity Revenue Bonds (13.4%)
		Excise Tax (2.2%)
		Rio Nuevo Facilities District (Tucson)
	1,500,000	6.500%, 07/15/24 AGC Insured	A2/AA/NR		1,648,350
		Scottsdale Municipal Property Corp.
	3,000,000	4.500%, 07/01/20 AMBAC Insured	Aa1/AAA/AAA		3,081,120

14 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

			Rating
Principal			Moody’s, S&P
Amount		Pre-Refunded\ Escrowed to Maturity Revenue Bonds (continued)	and Fitch	Value

		Excise Tax (continued)
		Scottsdale Municipal Property Corp.
		Water & Sewer Project
$	2,000,000	5.000%, 07/01/28	Aa1/AAA/AAA	$	2,143,660
		Total Excise Tax			6,873,130

		Higher Education (0.6%)
		Cochise Co. Community College District
	1,825,000	5.125%, 07/01/28 AGC Insured	A2/NR/NR		1,956,729

		Hospital (1.9%)
		Maricopa Co. Hospital Revenue
		(Sun Health)
	1,500,000	5.000%, 04/01/25	NR/NR/NR*		1,787,160
	2,125,000	5.000%, 04/01/35	NR/NR/NR*		2,667,087
		University Medical Center
		Hospital Revenue
	910,000	6.500%, 07/01/39	NR/NR/NR*		1,045,135
	500,000	6.000%, 07/01/39	NR/NR/NR*		608,165
		Total Hospital			6,107,547

		Lease (2.0%)
		Arizona School Facilities Board COP
	1,000,000	5.125%, 09/01/21 AGC Insured	Aa3/AA/NR		1,079,840
	3,000,000	5.500%, 09/01/23	Aa3/AA-/NR		3,260,700
		State of Arizona COP
	2,000,000	5.000%, 09/01/26 AGMC Insured	Aa3/AA/NR		2,113,680
		Total Lease			6,454,220

		Mortgage (1.3%)
		Maricopa Co. Industrial Development
		Authority Multi-Family Mortgage
		Revenue (National Health Project)
	430,000	5.500%, 01/01/18 AGMC
		Insured ETM	A2/AA/NR		443,162
		Maricopa Co. Industrial Development
		Authority Single Family Mortgage Revenue
	3,715,000	zero coupon, 12/31/16 ETM	Aaa/AA+/NR		3,706,678
		Total Mortgage			4,149,840

15 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)


			Rating
Principal			Moody’s, S&P
Amount		Pre-Refunded\ Escrowed to Maturity Revenue Bonds (continued)	and Fitch	Value

		Transportation (2.3%)
		Arizona Transportation Board Revenue
$	1,900,000	5.250%, 07/01/24	Aa2/AA+/AA	$	2,195,583
	2,550,000	5.000%, 07/01/28	Aa1/AAA/NR		2,733,167
	550,000	5.250%, 07/01/32	Aa2/AA+/NR		655,666
	1,500,000	5.000%, 07/01/33	Aa1/AAA/NR		1,607,745
		Total Transportation			7,192,161

		Utility (1.2%)
		Arizona Water Infrastructure
		Finance Authority
	3,500,000	5.000%, 10/01/28	Aaa/AAA/NR		3,782,240

		Water/Sewer (1.9%)
		Gilbert Water Resource Municipal
		Property Corp.
	2,000,000	5.000%, 10/01/29 NPFG Insured	A3/AA+/AA		2,081,960
		Glendale Water & Sewer Revenue
	1,670,000	4.750%, 07/01/24 AGMC Insured	A1/AA/NR		1,749,642
		Pima Co. Sewer Revenue System
	2,000,000	5.000%, 07/01/26	NR/AA/AA-		2,361,200
		Total Water/Sewer			6,192,802
		Total Pre-Refunded\Escrowed to
		Maturity Revenue Bonds			42,708,669
		Total Pre-Refunded\ Escrowed to
		Maturity Bonds			56,946,571
		Total Municipal Bonds
		(cost $296,431,715)			318,164,177

Shares		Short-Term Investment (0.8%)
	2,601,473	Dreyfus Tax Exempt Cash Management,
		Institutional Shares, 0.55%**
		(cost $2,601,473)	NR/Aaam/NR		2,601,473

		Total Investments
		(cost $299,033,188-note 4)	100.4%		320,765,650
		Other assets less liabilities	(0.4)		(1,184,637	)
		Net Asset	100.0%	$	319,581,013

16 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)


	Percent of
Portfolio Distribution By Quality Rating	Investments†
Aaa of Moody’s or AAA of S&P or Fitch		8.0	%
Pre-refunded bonds\ ETM bonds††		17.2
Aa of Moody’s or AA of S&P or Fitch		50.0
A of Moody’s or S&P or Fitch		19.6
Baa of Moody’s or BBB of S&P or Fitch		4.3
D of S&P		0.1
Not Rated*		0.8
		100.0	%

PORTFOLIO ABBREVIATIONS
		ACA - American Capital Assurance Financial Guaranty Corp.
		AGC - Assured Guaranty Corp.
		AGMC - Assured Guaranty Municipal Corp.
		AMBAC - American Municipal Bond Assurance Corp.
		AMT - Alternative Minimum Tax
		BAMAC - Build America Mutual Assurance Co.
		BHAC - Berkshire Hathaway Assurance Corp.
		COP- Certificates of Participation
		ETM - Escrowed to Maturity
		FGIC - Financial Guaranty Insurance Co.
		MAC - Municipal Assurance Corp.
		NPFG - National Public Finance Guarantee
		NR - Not Rated

*		Any security not rated (“NR”) by any of the Nationally Recognized Statistical Rating Organizations (“NRSRO”) has been determined by the Investment Adviser to have sufficient quality to be ranked in the top four credit ratings if a credit rating were to be assigned by a NRSRO.

**		The rate is an annualized seven-day yield at period end.

***		Illiquid security: This security represents 0.04% of net assets. Security is in default and is non-income producing.

†		Where applicable, calculated using the highest rating of the three NRSRO. Percentages in this table do not include the Short-Term Investment.

See accompanying notes to financial statements.

17 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)


††		Pre-refunded bonds are bonds secured by an escrow account, comprised of U.S. Government Obligations (unless otherwise noted), to retire the bonds at their earliest call date. Escrowed to Maturity bonds are bonds where money has been placed in the escrow account which is used to pay principal and interest through the bond’s originally scheduled maturity date. Escrowed to Maturity are shown as ETM. All other securities in the category are pre-refunded.

†††		Security purchased on a delayed delivery or when-issued basis.

Note:		144A – Private placement subject to SEC rule 144A, which modifies a two-year holding period requirement to permit qualified institutional buyers to trade these securities among themselves, thereby significantly improving the liquidity of these securities.

See accompanying notes to financial statements.

18 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

STATEMENT OF ASSETS AND LIABILITIES

SEPTEMBER 30, 2016 (unaudited)

ASSETS
Investments at value (cost $299,033,188)	$	320,765,650
Interest receivable		3,700,707
Receivable for Fund shares sold		355,139
Other assets		21,385
Total assets		324,842,881
LIABILITIES
Payable for investment securities purchased		4,661,746
Payable for Fund shares redeemed		219,605
Dividends payable		165,144
Management fee payable		112,115
Distribution and service fees payable		3,785
Accrued expenses		99,473
Total liabilities		5,261,868

NET ASSETS	$	319,581,013
Net Assets consist of:
Capital Stock - Authorized an unlimited number of
shares, par value $0.01 per share	$	290,516
Additional paid-in capital		295,812,417
Net unrealized appreciation on investments (note 4)		21,732,462
Accumulated net realized gain on investments		541,925
Undistributed net investment income		1,203,693
	$	319,581,013
CLASS A
Net Assets	$	250,518,313
Capital shares outstanding		22,779,324
Net asset value and redemption price per share	$	11.00
Maximum offering price per share (100/96 of $11.00)	$	11.46
CLASS C
Net Assets	$	18,429,681
Capital shares outstanding		1,676,091
Net asset value and offering price per share	$	11.00
Redemption price per share (*a charge of 1% is imposed
on the redemption proceeds, or on the original price,
whichever is lower, if redeemed during the first 12
months after purchase)	$	11.00	*
CLASS Y
Net Assets	$	50,633,019
Capital shares outstanding		4,596,225
Net asset value, offering and redemption price per share	$	11.02

See accompanying notes to financial statements.

19 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

STATEMENT OF OPERATIONS

SIX MONTHS ENDED SEPTEMBER 30, 2016 (unaudited)

Investment Income:

Interest income			$	5,813,864


Expenses:

Management fee (note 3)	$	635,427
Distribution and service fees (note 3)		282,976
Transfer and shareholder servicing agent fees		63,782
Trustees’ fees and expenses (note 7)		50,451
Legal fees		44,767
Registration fees and dues		15,675
Shareholders’ reports		12,771
Auditing and tax fees		10,989
Insurance		6,690
Custodian fees		5,100
Chief compliance officer services (note 3)		4,492
Miscellaneous		22,499
Total expenses				1,155,619
Net investment income				4,658,245

Realized and Unrealized Gain (Loss) on Investments:

Net realized gain (loss) from securities
transactions		153,025
Change in unrealized appreciation on
investments		826,232

Net realized and unrealized gain (loss) on
investments				979,257
Net change in net assets resulting from
operations			$	5,637,502

See accompanying notes to financial statements.

20 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

STATEMENTS OF CHANGES IN NET ASSETS

	Six Months Ended
	September 30, 2016			Year Ended
	(unaudited)			March 31, 2016

OPERATIONS:
Net investment income	$	4,658,245		$	9,446,407
Net realized gain (loss) from
securities transactions		153,025			414,127
Change in unrealized
appreciation on investments		826,232			(788,850	)
Change in net assets resulting
from operations		5,637,502			9,071,684

DISTRIBUTIONS TO SHAREHOLDERS (note 9):
Class A Shares:
Net investment income		(3,605,518	)		(7,510,140	)
Net realized gain on investments		—			(468,730	)
Class C Shares:
Net investment income		(192,296	)		(425,741	)
Net realized gain on investments		—			(35,574	)
Class Y Shares:
Net investment income		(719,803	)		(1,154,185	)
Net realized gain on investments		—			(77,892	)
Change in net assets from
distributions		(4,517,617	)		(9,672,262	)

CAPITAL SHARE TRANSACTIONS (note 6):
Proceeds from shares sold		32,478,783			46,981,416
Reinvested dividends and
distributions		3,599,649			7,909,123
Cost of shares redeemed		(19,318,629	)		(31,848,006	)
Change in net assets from
capital share transactions		16,759,803			23,042,533

Change in net assets		17,879,688			22,441,955

NET ASSETS:
Beginning of period		301,701,325			279,259,370

End of period*	$	319,581,013		$	301,701,325

*Includes undistributed net investment income of:	$	1,203,693		$	1,063,065

See accompanying notes to financial statements.

21 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS

SEPTEMBER 30, 2016 (unaudited)

1. Organization

Aquila Tax-Free Trust of Arizona (the “Fund”), a series of Aquila Municipal Trust (prior to October 12, 2013, the Fund operated under the name Tax-Free Trust of Arizona), a non-diversified, open-end investment company, was organized on October 17, 1985, as a Massachusetts business Trust and commenced operations on March 13, 1986. The Fund is authorized to issue an unlimited number of shares. Class A Shares are sold at net asset value plus a sales charge of varying size (depending upon a variety of factors) paid at the time of purchase and bear a distribution fee. Class C Shares are sold at net asset value with no sales charge payable at the time of purchase but with a level charge for service and distribution fees for six years thereafter. Class C Shares automatically convert to Class A Shares after six years. Class Y Shares are sold only through authorized financial institutions acting for investors in a fiduciary, advisory, agency, custodial or similar capacity, and are not offered directly to retail customers. Class Y Shares are sold at net asset value with no sales charge, no redemption fee, no contingent deferred sales charge (“CDSC”) and no distribution fee. Class I Shares are offered and sold only through financial intermediaries and are not offered directly to retail customers. Class I Shares are sold at net asset value with no sales charge and no redemption fee or CDSC, although a financial intermediary may charge a fee for effecting a purchase or other transaction on behalf of its customers. Class I Shares carry a distribution and a service fee. As of the report date, there were no Class I Shares outstanding. All classes of shares represent interests in the same portfolio of investments and are identical as to rights and privileges but differ with respect to the effect of sales charges, the distribution and/or service fees borne by each class, expenses specific to each class, voting rights on matters affecting a single class and the exchange privileges of each class.

2. Significant Accounting Policies

22 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Fund has the ability to access.

The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities The following is a summary of the valuation inputs, representing 100% of the Fund’s investments, used to value the Fund’s net assets as of September 30, 2016:

Valuation Inputs*	Investments in Securities
Level 1 – Quoted Prices - Short-Term Investment	$	2,601,473
Level 2 – Other Significant Observable
Inputs — Municipal Bonds*		318,164,177
Level 3 – Significant Unobservable Inputs		—
Total	$	320,765,650

* See schedule of investments for a detailed listing of securities.

c)	Subsequent events: In preparing these financial statements, the Fund has evaluated events and transactions for potential recognition or disclosure through the date these financial statements were issued.

23 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Multiple Class Allocations: All income, expenses (other than class-specific expenses), and realized and unrealized gains or losses are allocated daily to each class of shares based on the relative net assets of each class. Class-specific expenses, which include distribution and service fees and any other items that are specifically attributed to a particular class, are also charged directly to such class on a daily basis.

Reclassification of capital accounts: Accounting principles generally accepted in the United States of America require that certain components of net assets relating to permanent differences be reclassified between financial and tax reporting. These reclassifications have no effect on net assets or net asset value per share. For the year ended March 31, 2016, there were no items identified that have been reclassified among components of net assets.

i)	The Trust is an investment company and accordingly follows the investment company accounting and reporting guidance of the Financial Accounting Standards Board (“FASB”) Accounting Standard Codification Topic 946 “Financial Services-Investment Companies”.

3. Fees and Related Party Transactions

a) Management Arrangements:

Aquila Investment Management LLC (the “Manager”), a wholly-owned subsidiary of Aquila Management Corporation, the Fund’s founder and sponsor, serves as the Manager for the Fund under an Advisory and Administration Agreement with the Fund. Under the Advisory and Administration Agreement, the Manager provides all investment management and administrative services to the Fund. The Manager’s services include providing the office of the Fund and all related services as well as managing relationships with all the various support organizations to the Fund such as the shareholder servicing agent, custodian, legal counsel, auditors and distributor. For its services, the Manager is entitled to receive a fee which is payable monthly and computed as of the close of business each day at the annual rate of 0.40% on the Fund’s net assets.

24 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

Specific details as to the nature and extent of the services provided by the Manager are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

b) Distribution and Service Fees:

Under another part of the Plan, the Fund is authorized to make payments with respect to Class C Shares to Qualified Recipients which have rendered assistance in the distribution and/or retention of the Fund’s Class C Shares or servicing of shareholder accounts. These payments are made at the annual rate of 0.75% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, amounted to $71,339. In addition, under a Shareholder Services Plan, the Fund is authorized to make service fee payments with respect to Class C Shares to Qualified Recipients for providing personal services and/or maintenance of shareholder accounts. These payments are made at the annual rate of 0.25% of the Fund’s average net assets represented by Class C Shares and for the six months ended September 30, 2016, these payments amounted to $23,780. The total of these payments with respect to Class C Shares amounted to $95,119, of which the Distributor retained $22,565.

Specific details about the Plans are more fully defined in the Fund’s Prospectus and Statement of Additional Information.

Under a Distribution Agreement, the Distributor serves as the exclusive distributor of the Fund’s shares. Through agreements between the Distributor and various brokerage and advisory firms (“intermediaries”), the Fund’s shares are sold primarily through the facilities of these intermediaries having offices within Arizona, with the bulk of any sales commissions inuring to such intermediaries. For the six months ended September 30, 2016, total commissions on sales of Class A Shares amounted to $140,451, of which the Distributor received $26,890.

25 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

4. Purchases and Sales of Securities

During the six months ended September 30, 2016, purchases of securities and proceeds from the sales of securities aggregated $34,370,776 and $9,642,702, respectively.

At September 30, 2016, the aggregate tax cost for all securities was $298,784,126. At September 30, 2016, the aggregate gross unrealized appreciation for all securities in which there is an excess of value over tax cost amounted to $22,445,622 and aggregate gross unrealized depreciation for all securities in which there is an excess of tax cost over value amounted to $464,098 for a net unrealized appreciation of $21,981,524.

5. Portfolio Orientation

Since the Fund invests principally and may invest entirely in double tax-free municipal obligations of issuers within Arizona, it is subject to possible risks associated with economic, political, or legal developments or industrial or regional matters specifically affecting Arizona and whatever effects these may have upon Arizona issuers’ ability to meet their obligations. The Fund is also permitted to invest in U.S. territorial municipal obligations meeting comparable quality standards and providing income which is exempt from both regular Federal and Arizona income taxes. The general policy of the Fund is to invest in such securities only when comparable securities of Arizona issuers are not available in the market. At September 30, 2016, the Fund had all of its assets invested in the securities of Arizona issuers.

26 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

6. Capital Share Transactions

Transactions in Capital Shares of the Fund were as follows:

	Six Months Ended
	September 30, 2016						Year Ended
	(unaudited)						March 31, 2016
	Shares			Amount			Shares			Amount
Class A Shares:
Proceeds from shares sold		1,585,913		$	17,513,500		$	2,203,807			24,006,382
Reinvested dividends and
distributions		264,045			2,910,796			601,856			6,547,939
Cost of shares redeemed		(1,166,083	)		(12,860,452	)		(2,048,997	)		(22,286,916	)
Net change		683,875			7,563,844			756,666			8,267,405
Class C Shares:
Proceeds from shares sold		239,125			2,640,324			434,763			4,729,665
Reinvested dividends and
distributions		14,746			162,506			37,177			404,309
Cost of shares redeemed		(253,487	)		(2,800,761	)		(408,504	)		(4,439,895	)
Net change		384			2,069			63,436			694,079
Class Y Shares:
Proceeds from shares sold		1,114,160			12,324,959			1,674,677			18,245,369
Reinvested dividends and
distributions		47,594			526,347			87,751			956,875
Cost of shares redeemed		(330,595	)		(3,657,416	)		(468,711	)		(5,121,195	)
Net change		831,159			9,193,890			1,293,717			14,081,049
Total transactions in Fund
shares		1,515,418		$	16,759,803		$	2,113,819			23,042,533

27 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

7. Trustees’ Fees and Expenses

For the six months ended September 30, 2016, there were 9 Trustees, one of whom is affiliated with the Manager and is not paid any fees. The total amount of Trustees’ service fees (for carrying out their responsibilities) and attendance fees paid during the six months ended September 30, 2016 was $42,047. Attendance fees are paid to those in attendance at regularly scheduled quarterly Board Meetings and meetings of the Independent Trustees held prior to each quarterly Board Meeting, as well as additional meetings (such as Audit, Nominating, Shareholder and special meetings). Trustees are reimbursed for their expenses such as travel, accommodations and meals incurred in connection with attendance at Board Meetings and the Annual and Outreach Meetings of Shareholders. For the six months ended September 30, 2016, such meeting-related expenses amounted to $8,404.

8. Securities Traded on a When-Issued Basis

9. Income Tax Information and Distributions

28 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS (continued)

SEPTEMBER 30, 2016 (unaudited)

The tax character of distributions was as follows:

	Year		Year
	Ended		Ended
	March 31, 2016		March 31, 2015
Net tax-exempt income	$	9,000,717	$	9,294,735
Ordinary Income		89,349		48,403
Long-term capital gains		582,196		–
	$	9,672,262	$	9,343,138

As of March 31, 2016, the components of distributable earnings on a tax basis were as follows:

Undistributed tax-exempt income	$	271,388
Undistributed net realized gain on investments		413,920
Unrealized appreciation		21,757,281
Other temporary differences		(84,394	)
	$	22,358,195

29 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

FINANCIAL HIGHLIGHTS

For a share outstanding throughout each period

	Class A
	Six Months															Year Ended
	Ended			Year			Year			Year			Nine Months			June 30
	9/30/16(unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.95		$	10.98		$	10.63		$	10.97		$	10.92		$	10.37		$	10.50
Income from investment operations:
Net investment income(1)		0.17			0.37			0.38			0.38			0.29			0.41			0.42
Net gain (loss) on securities (both
realized and unrealized)		0.04			(0.03	)		0.35			(0.34	)		0.05			0.54			(0.13	)
Total from investment operations		0.21			0.34			0.73			0.04			0.34			0.95			0.29
Less distributions (note 9):
Dividends from net investment income		(0.16	)		(0.35	)		(0.38	)		(0.37	)		(0.29	)		(0.40	)		(0.42	)
Distributions from capital gains		—			(0.02	)		—			(0.01	)		—			—			—
Total distributions		(0.16	)		(0.37	)		(0.38	)		(0.38	)		(0.29	)		(0.40	)		(0.42	)
Net asset value, end of period	$	11.00		$	10.95		$	10.98		$	10.63		$	10.97		$	10.92		$	10.37
Total return (not reflecting sales charge)		1.91	%(2)		3.20	%		6.92	%		0.49	%		3.08	%(2)		9.29	%		2.80	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	251		$	242		$	234		$	229		$	265		$	274		$	260
Ratio of expenses to average net assets		0.71	%(3)		0.71	%		0.73	%		0.78	%(4)		0.73	%(3)		0.73	%		0.73	%
Ratio of net investment income to
average net assets		2.99	%(3)		3.36	%		3.49	%		3.59	%(4)		3.50	%(3)		3.78	%		4.07	%
Portfolio turnover rate		3	%.(2)		10	%		14	%		10	%		8	%(2)		17	%		12	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Trust into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.73% and 3.64%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

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AQUILA TAX-FREE TRUST OF ARIZONA

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class C
	Six Months															Year Ended
	Ended			Year			Year			Year			Nine Months			June 30
	9/30/16 (unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.95		$	10.98		$	10.63		$	10.97		$	10.92		$	10.37		$	10.50
Income from investment operations:
Net investment income(1)		0.12			0.28			0.29			0.29			0.22			0.31			0.33
Net gain (loss) on securities (both
realized and unrealized)		0.04			(0.03	)		0.34			(0.34	)		0.05			0.55			(0.13	)
Total from investment operations		0.16			0.25			0.63			(0.05	)		0.27			0.86			0.20
Less distributions (note 9):
Dividends from net investment income		(0.11	)		(0.26	)		(0.28	)		(0.28	)		(0.22	)		(0.31	)		(0.33	)
Distributions from capital gains		—			(0.02	)		–			(0.01	)		–			–			–
Total distributions		(0.11	)		(0.28	)		(0.28	)		(0.29	)		(0.22	)		(0.31	)		(0.33	)
Net asset value, end of period	$	11.00		$	10.95		$	10.98		$	10.63		$	10.97		$	10.92		$	10.37
Total return (not reflecting CDSC)		1.48	%(2)		2.34	%		6.02	%		(0.36	)%		2.43	%(2)		8.36	%		1.93	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	18		$	18		$	18		$	16		$	24		$	21		$	15
Ratio of expenses to average net assets		1.57	%(3)		1.56	%		1.58	%		1.63	%(4)		1.57	%(3)		1.58	%		1.57	%
Ratio of net investment income to
average net assets		2.13	%(3)		2.51	%		2.63	%		2.74	%(4)		2.64	%(3)		2.91	%		3.21	%
Portfolio turnover rate		3	%(2)		10	%		14	%		10	%		8	%(2)		17	%		12	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Trust into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 1.58% and 2.79%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

31 | Aquila Tax-Free Trust of Arizona

AQUILA TAX-FREE TRUST OF ARIZONA

FINANCIAL HIGHLIGHTS (continued)

For a share outstanding throughout each period

	Class Y
	Six Months															Year Ended
	Ended			Year			Year			Year			Nine Months			June 30
	9/30/16 (unaudited)			Ended 3/31/16			Ended 3/31/15			Ended 3/31/14			Ended 3/31/13†			2012			2011
Net asset value, beginning of period	$	10.97		$	11.00		$	10.65		$	10. 99		$	10. 94		$	10. 39		$	10. 52
Income from investment operations:
Net investment income(1)		0.17			0.38			0.40			0.40			0.30			0.42			0.44
Net gain (loss) on securities (both
realized and unrealized)		0.05			(0.02	)		0.34			(0.34	)		0.05			0.55			(0.14	)
Total from investment operations		0.22			0.36			0.74			0.06			0.35			0.97			0.30
Less distributions (note 9):
Dividends from net investment income		(0.17	)		(0.37	)		(0.39	)		(0.39	)		(0.30	)		(0.42	)		(0.43	)
Distributions from capital gains		—			(0.02	)		–			(0.01	)		–			–			–
Total distributions		(0.17	)		(0.39	)		(0.39	)		(0.40	)		(0.30	)		(0.42	)		(0.43	)
Net asset value, end of period	$	11.02		$	10.97		$	11.00		$	10.65		$	10.99		$	10.94		$	10.39
Total return		1.99	%(2)		3.38	%		7.07	%		0.64	%		3.20	%(2)		9.44	%		2.95	%
Ratios/supplemental data
Net assets, end of period (in millions)	$	51		$	41		$	27		$	20		$	24		$	16		$	11
Ratio of expenses to average net assets		0.56	%(3)		0.56	%		0.58	%		0.63	%(4)		0.58	%(3)		0.58	%		0.58	%
Ratio of net investment income to
average net assets		3.15	%(3)		3.49	%		3.63	%		3.74	%(4)		3.64	%(3)		3.92	%		4.22	%
Portfolio turnover rate		3	%(2)		10	%		14	%		10	%		8	%(2)		17	%		12	%

_________________

(1)	Per share amounts have been calculated using the daily average shares method.

(2)	Not annualized.

(3)	Annualized.

(4)	Includes expenses incurred in connection with the reorganization of the Trust into a series of Aquila Municipal Trust. Without these expenses, the expense ratio and the net investment income ratio would have been 0.58% and 3.79%, respectively, for the year ended March 31, 2014.

†	Effective December 1, 2012, the Fund changed its fiscal year end from June 30 to March 31. The information presented is for the period July 1, 2012 to March 31, 2013.

See accompanying notes to financial statements.

32 | Aquila Tax-Free Trust of Arizona

Analysis of Expenses (unaudited)

As a shareholder of the Fund, you may incur two types of costs: (1) transaction costs, including front-end sales charges with respect to Class A shares or contingent deferred sales charges (“CDSC”) with respect to Class C shares; and (2) ongoing costs, including management fees; distribution (“12b-1”) and/or service fees; and other Fund expenses. The table below is intended to help you understand your ongoing costs (in dollars) of investing in the Fund and to compare these costs with the ongoing costs of investing in other mutual funds.

The table below is based on an investment of $1,000 invested on April 1, 2016 and held for the six months ended September 30, 2016.

Actual Expenses

Six months ended September 30, 2016

	Actual
	Total Return	Beginning	Ending	Expenses
	Without	Account	Account	Paid During
	Sales Charges(1)	Value	Value	the Period(2)
Class A	1.91%	$1,000.00	$1,019.10	$3.59
Class C	1.48%	$1,000.00	$1,014.80	$7.93
Class Y	1.99%	$1,000.00	$1,019.90	$2.84

(1)

(2)	Expenses are equal to the annualized expense ratio of 0.71%, 1.57% and 0.56% for the Fund’s Class A, C and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

33 | Aquila Tax-Free Trust of Arizona

Analysis of Expenses (unaudited) (continued)

Hypothetical Example for Comparison Purposes

Six months ended September 30, 2016

	Hypothetical
	Annualized	Beginning	Ending	Expenses
	Total	Account	Account	Paid During
	Return	Value	Value	the Period(1)
Class A	5.00%	$1,000.00	$1,021. 51	$3.60
Class C	5.00%	$1,000.00	$1,017. 20	$7.94
Class Y	5.00%	$1,000.00	$1,022. 26	$2.84

(1)	Expenses are equal to the annualized expense ratio of 0.71%, 1.57% and 0.56% for the Fund’s Class A, C and Y shares, respectively, multiplied by the average account value over the period, multiplied by 183/365 (to reflect the one-half year period).

34 | Aquila Tax-Free Trust of Arizona

Information Available (unaudited)

Much of the information that the funds in the Aquila Group of Funds produce is automatically sent to you and all other shareholders. Specifically, you are routinely sent your Fund’s entire list of portfolio securities twice a year in the semi-annual and annual reports you receive. Additionally, under Fund policies, the Fund publicly discloses the complete schedule of the Fund’s portfolio holdings, as of each calendar quarter, generally by the 15th day after the end of each calendar quarter. Such information remains accessible until the next schedule is made publicly available. You may obtain a copy of the Fund’s portfolio holdings schedule for the most recently completed period by visiting the Fund’s website at www.aquilafunds.com. Whenever you wish to see a listing of your Fund’s portfolio other than in your shareholder reports, please check our website at www.aquilafunds.com or call us at 1-800-437-1020.

The Fund additionally files a complete list of its portfolio holdings with the SEC for the first and third quarter ends of each fiscal year on Form N-Q. Forms N-Q are available free of charge on the SEC website at www.sec.gov. You may also review or, for a fee, copy the forms at the SEC’s Public Reference Room in Washington, D.C. or by calling 1-800-SEC-0330.

Proxy Voting Record (unaudited)

Federal Tax Status of Distributions (unaudited)

This information is presented in order to comply with a requirement of the Internal Revenue Code. No action on the part of shareholders is required.

For the fiscal year ended March 31, 2016, $9,000,717 of dividends paid by Aquila Tax-Free Trust of Arizona, constituting 93% of total dividends paid, were exempt-interest dividends, and $582,196 of dividends paid by the Fund constituting 6% of total dividends paid were capital gains: and the balance was ordinary income.

Prior to February 15, 2017, shareholders will be mailed the appropriate tax form(s) which will contain information on the status of distributions paid for the 2016 calendar year.

35 | Aquila Tax-Free Trust of Arizona

Additional Information (unaudited)

Renewal of the Advisory and Administration Agreement

Aquila Investment Management LLC (the “Manager”) serves as the investment adviser to the Trust pursuant to an Advisory and Administration Agreement (the “Advisory Agreement”). In order for the Manager to remain the investment adviser of the Trust, the Trustees of the Trust must determine annually whether to renew the Advisory Agreement for the Trust.

In considering whether to approve the renewal of the Advisory Agreement, the Trustees requested and obtained such information as they deemed reasonably necessary. Contract review materials were provided to the Trustees in August, 2016. The independent Trustees met telephonically on August 30, 2016 and in person on September 18, 2016 to review and discuss the contract review materials. The Trustees considered, among other things, information presented by the Manager. They also considered information presented in a report prepared by an independent consultant with respect to the Trust’s fees, expenses and investment performance, which included comparisons of the Trust’s investment performance against peers and the Trust’s benchmark and comparisons of the advisory fee payable under the Advisory Agreement against the advisory fees paid by the Trust’s peers, as well as information regarding the operating margins of certain investment advisory firms (the “Consultant’s Report”). In addition, the Trustees took into account the information related to the Trust provided to the Trustees at each regularly scheduled meeting.

At the meeting held on September 18, 2016, based on their evaluation of the information provided by the Manager and the independent consultant, the Trustees of the Trust, including the independent Trustees voting separately, unanimously approved the renewal of the Advisory Agreement until September 30, 2017. In considering the renewal of the Advisory Agreement, the Trustees considered various factors that they determined were relevant, including the factors described below. The Trustees did not identify any single factor as the controlling factor in determining to approve the renewal of the Advisory Agreement.

The nature, extent, and quality of the services provided by the Manager

The Trustees considered the nature, extent and quality of the services that had been provided by the Manager to the Trust, taking into account the investment objectives and strategies of the Trust. The Trustees reviewed the terms of the Advisory Agreement.

The Trustees reviewed the Manager’s investment approach for the Trust and its research process. The Trustees considered that the Manager had provided all advisory and administrative services to the Trust that the Trustees deemed necessary or appropriate, including the specific services that the Trustees have determined are required for the Trust, given that it seeks to provide shareholders with as high a level of current income exempt from Arizona state and regular Federal income taxes as is consistent with preservation of capital. The Trustees considered the personnel of the Manager who provide investment management services to the Trust. The Manager has employed Mr. Todd Curtis as portfolio manager for the Trust and has established facilities and capabilities for credit analysis of the Trust’s portfolio securities. The Trustees noted the extensive experience of the portfolio manager. They considered that Mr. Curtis is based in Phoenix, Arizona and that he has a comprehensive understanding regarding the economy of the State of Arizona and the securities in which the Trust invests, including those securities with less than the highest ratings from the rating agencies. The Trustees also noted that the Trust did not own any Puerto Rico municipal bonds during the review period.

36 | Aquila Tax-Free Trust of Arizona

The Trustees noted that the Manager has additionally provided all administrative services to the Trust and provided the Trust with personnel (including Trust officers) and other resources that are necessary for the Trust’s business management and operations. The Trustees considered the nature and extent of the Manager’s supervision of third-party service providers, including the Trust’s fund accountant, shareholder servicing agent and custodian.

Based on these considerations, the Trustees concluded that the nature, extent and quality of services that had been provided by the Manager to the Trust were satisfactory and consistent with the terms of the Advisory Agreement.

The investment performance of the Trust

The Trustees reviewed the Trust’s performance (Class A shares) and compared its performance to the performance of:

•

the funds in the Trust’s peer group (the “Peer Group”), as selected by the independent consultant (six Arizona intermediate and long municipal bond funds, as classified by Morningstar, that charge a front-end sales charge);

•

the funds in the Trust’s product category for performance (the “Product Category for Performance”) (all funds in the Peer Group and, without duplication, all funds (and all classes) included in the Morningstar Single-State Intermediate Municipal Bond Funds category); and

•

the Trust’s benchmark index, the Barclays Capital Quality Intermediate Municipal Bond Index.

The Trustees considered that the materials included in the Consultant’s Report indicated that the Trust’s average annual total return was lower than the average annual total return of the funds in the Peer Group for each of the one and five-year periods ended June 30, 2016 but equal to or 0.01% lower than the average annual total return of the funds in the Peer Group for the three and ten-year periods ended June 30, 2016, respectively. The Trustees also considered that, as reflected in the Consultant’s Report, the Trust’s average annual total return was higher than the average annual total return of the funds in the Product Category for Performance for the one, three, five and ten-year periods ended June 30, 2016, as well as the benchmark index for each of the one, three and five year periods ended June 30, 2016. The Trustees determined that, as reflected in the Consultant’s Report, the Trust delivered above-average results on a risk-adjusted basis for the three and five year periods ended June 30, 2016 (as evidenced by its Sharpe ratio) when compared to the funds in the Product Category for Performance. The Trustees noted that, unlike the Trust’s returns, the performance of the benchmark index did not reflect any fees or expenses.

37 | Aquila Tax-Free Trust of Arizona

The Trustees discussed the Trust’s performance record with the Manager and considered the Manager’s view that the Fund’s performance, as compared to its peer group, was explained in part by the Fund’s generally higher-quality portfolio and lower duration.

The Trustees considered the Fund’s investment performance to be consistent with the investment objectives of the Fund. Evaluation of the investment performance of the Trust indicated to the Trustees that renewal of the Advisory Agreement would be appropriate.

Advisory Fees and Trust Expenses

The Trustees reviewed the Trust’s advisory fees and expenses and compared them to the advisory fee and expense data for:

•

the funds in the Peer Group (as defined above); and

•

the funds in the product category for expenses (the “Product Category for Expenses”) (Morningstar Single-State Intermediate Municipal Bond Funds and Morningstar Single State Long Municipal Bond Funds from states within which eight or more mutual funds are operating, with similar operating expense structures).

The Trustees considered that the Trust’s contractual advisory fee was lower than the average and median contractual advisory fee of the funds in the Peer Group (at the Trust’s current asset level) and lower than the asset-weighted average contractual advisory fee of the funds in the Product Category for Expenses (at various asset levels).

The Trustees noted that the Trust’s actual management fee was higher than the average actual management fee of the funds in the Peer Group (after giving effect to fee waivers in effect for those funds) but lower than the average actual management fee of the funds in the Product Category for Expenses (after giving effect to fee waivers in effect for those funds). They noted that the Trust’s expenses were less than the average actual expenses of the funds in both the Product Category for Expenses and the Peer Group (after giving effect to fee waivers in effect for those funds).

The Trustees reviewed management fees charged by the Manager to its other clients. It was noted that the Manager does not have any other clients except for other funds in the Aquila Group of Funds. The Trustees noted that, in most instances, the fee rates for those clients were comparable to the fees paid to the Manager with respect to the Trust. In evaluating the fees associated with the other funds, the Trustees took into account the respective demands, resources and complexity associated with the Trust and those funds.

The Trustees concluded that the advisory fee and expenses of the Trust were reasonable in relation to the nature and quality of the services provided by the Manager to the Trust.

38 | Aquila Tax-Free Trust of Arizona

Profitability

The Trustees received materials from each of the Manager and the independent consultant related to profitability. The Manager provided information which showed the profitability to the Manager of its services to the Trust, as well as the profitability of Aquila Distributors LLC of distribution services provided to the Trust. The independent consultant provided publicly available data regarding the profitability of other asset managers in comparison to the overall profitability of the Manager.

The Trustees considered the information provided by the Manager regarding the profitability of the Manager with respect to the advisory services provided by the Manager to the Trust, including the methodology used by the Manager in allocating certain of its costs to the management of the Trust. The Trustees also considered information regarding the profitability of the Manager provided to the Trustees by the independent consultant. The Trustees concluded that profitability to the Manager with respect to the advisory services provided to the Trust did not argue against approval of the fees to be paid under the Advisory Agreement.

The extent to which economies of scale would be realized as the Trust grows

The Trustees considered the extent to which the Manager may realize economies of scale or other efficiencies in managing the Trust. The Trustees considered that the materials indicated that the Trust’s fees are already generally lower than those of its peers, including those with breakpoints. The Trustees noted that the Manager’s profitability also may be an indicator of the availability of any economies of scale. Accordingly, the Trustees concluded that economies of scale, if any, were being appropriately shared with the Trust.

Benefits derived or to be derived by the Manager and its affiliate from the relationship with the Trust

The Trustees observed that, as is generally true of most fund complexes, the Manager and its affiliate, by providing services to a number of funds including the Trust, were able to spread costs as they would otherwise be unable to do. The Trustees noted that while that produces efficiencies and increased profitability for the Manager and its affiliate, it also makes their services available to the Trust at favorable levels of quality and cost which are more advantageous to the Trust than would otherwise have been possible.

39 | Aquila Tax-Free Trust of Arizona

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Founders

Lacy B. Herrmann (1929-2012)

Aquila Management Corporation, Sponsor

Manager

AQUILA INVESTMENT MANAGEMENT LLC 120

West 45th Street, Suite 3600

New York, New York 10036

Board of Trustees

John C. Lucking, Chair

Diana P. Herrmann, Vice Chair

Ernest Calderón

Thomas A. Christopher

Gary C. Cornia

Grady Gammage, Jr.

Glenn P. O’Flaherty

James R. Ramsey

Laureen L. White

Officers

Diana P. Herrmann, President

Charles E. Childs, III, Executive Vice President

and Secretary

Todd W. Curtis, Senior Vice President

and Portfolio Manager

Marie E. Aro, Senior Vice President

Paul G. O’Brien, Senior Vice President

Craig T. DiRuzzo, Vice President

Randall S. Fillmore, Chief Compliance Officer

Joseph P. DiMaggio, Chief Financial Officer

and Treasurer

Distributor

AQUILA DISTRIBUTORS LLC

120 West 45th Street, Suite 3600

New York, New York 10036

Transfer and Shareholder Servicing Agent

BNY MELLON INVESTMENT SERVICING (US) INC.

4400 Computer Drive

Westborough, Massachusetts 01581

Custodian

THE BANK OF NEW YORK MELLON

225 Liberty

Street New York, New York 10286

Further information is contained in the Prospectus,

which must precede or accompany this report.

ITEM 2.

CODE OF ETHICS.

Not applicable.

ITEM 3.

AUDIT COMMITTEE FINANCIAL EXPERT.

Not applicable.

ITEM 4.

PRINCIPAL ACCOUNTANT FEES AND SERVICES.

Not applicable.

ITEM 5.

AUDIT COMMITTEE OF LISTED REGISTRANTS.

Not applicable.

ITEM 6.

SCHEDULE OF INVESTMENTS.

Included in Item 1 above

ITEM 7.

DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 8.

PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.

Not applicable.

ITEM 9.

PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.

Not applicable.

ITEM 10.

SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

The Board of Directors of the Registrant has adopted a Nominating Committee Charter which provides that the Nominating Committee (the 'Committee') may consider and evaluate nominee candidates properly submitted by shareholders if a vacancy among the Independent Trustees of the Registrant occurs and if, based on the Board's then current size, composition and structure, the Committee determines that the vacancy should be filled. The Committee will consider candidates submitted by shareholders on the same basis as it considers and evaluates candidates recommended by other sources. A copy of the qualifications and procedures that must be met or followed by shareholders to properly submit a nominee candidate to the Committee may be obtained by submitting a request in writing to the Secretary of the Registrant.

ITEM 11.

CONTROLS AND PROCEDURES.

(a) Based on their evaluation of the registrant's disclosure controls and procedures (as defined in Rule 30a-2(c) under the Investment Company Act of 1940) as of a date within 90 days of the filing of this report, the registrant's chief financial and executive officers have concluded that the disclosure controls and procedures of the registrant are appropriately designed to ensure that information required to be disclosed in the registrant's reports that are filed under the Securities Exchange Act of 1934 are accumulated and communicated to registrant's management, including its principal executive officer(s) and principal financial officer(s), to allow timely decisions regarding required disclosure and is recorded, processed, summarized and reported, within the time periods specified in the rules and forms adopted by the Securities and Exchange Commission.

(b) There have been no significant changes in registrant's internal controls or in other factors that could significantly affect registrant's internal controls subsequent to the date of the most recent evaluation, including no significant deficiencies or material weaknesses that required corrective action.

ITEM 12.

EXHIBITS.

(a)(2) Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940.

(b) Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(b) under the Investment Company Act of 1940.

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.

AQUILA MUNICIPAL TRUST

By:	/s/ Diana P. Herrmann
	Vice Chair, President and Trustee February 3, 2017


By:	/s/ Joseph P. DiMaggio
	February 3, 2017

Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

By:	/s/ Diana P. Herrmann
	Diana P. Herrmann Vice Chair, President and Trustee February 3, 2017


By:	/s/ Joseph P. DiMaggio
	Joseph P. DiMaggio Chief Financial Officer and Treasurer February 3, 2017

AQUILA MUNICIPAL TRUST

EXHIBIT INDEX

(a)(2) Certifications of principal executive officer and principal financial officer as required by Rule 30a-2(a) under the Investment Company Act of 1940.

(b) Certification of chief executive officer and chief financial officer as required by Rule 30a-2(b) of the Investment Company Act of 1940.

Dated: February 3, 2017		/s/ Diana P. Herrmann
		Vice Chair, President and Trustee Aquila Municipal Trust


Dated: February 3, 2017		/s/ Joseph P. DiMaggio
		Chief Financial Officer and Treasurer Aquila Municipal Trust

/s/ Diana P. Herrmann
Title: Vice Chair, President and Trustee

/s/ Joseph P. DiMaggio
Title: Chief Financial Officer and Treasurer