485BPOS

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM N14

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REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 //

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Pre-Effective Amendment No. / /

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PostEffective Amendment No. 1/ X/

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(Check appropriate box or boxes)

T. Rowe Price New Income Fund, Inc.

Exact Name of Registrant as Specified in Charter

100 East Pratt Street, Baltimore, Maryland 21202

Address of Principal Executive Offices

4103452000

Registrant`s Telephone Number, Including Area Code

Henry H. Hopkins

100 East Pratt Street , Baltimore, Maryland 21202

Name and Address of Agent for Service

(Number and Street) (City) (State) (Zip Code)

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Calculation of Registration Fee under the Securities Act of 1933:

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Title of the securities being registered: Shares of common stock, par value $1.00 per share of the T. Rowe Price New Income Fund, Inc. The Registrant has registered an indefinite amount of securities pursuant to Rule 24f-2 under the Investment Company Act of 1940, as amended; accordingly, no filing fee is payable herewith in reliance upon Section 24(f).

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It is proposed that this filing will become effective immediately pursuant to Rule 485(b) under the Securities Act of 1933, as amended.

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This Post-Effective Amendment consists of the following:

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1) Facing Sheet of the Registration Statement.

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2) Part C to the Registration Statement (including signature page). Parts A and B are incorporated herein by reference from the Registrant`s Registration Statement on Form N-14 (File No. 022-48848) filed on March 10, 2006.

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This Post-Effective Amendment No. 1 to the Registrant`s Registration Statement on Form N-14, as amended, is being filed pursuant to Rule 485(b) under the Securities Act of 1933, as amended, solely for the purpose of filing an opinion of Ropes & Gray LLP, tax counsel for the Registrant, as Exhibit 12 to the Registration Statement on Form N-14, as amended.

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PART C

OTHER INFORMATION

Item 15. Indemnification

The Registrant maintains comprehensive Errors and Omissions and Officers and Directors insurance policies written by ICI Mutual. These policies provide coverage for T.Rowe Price Associates, Inc. ("Manager"), and its subsidiaries and affiliates as listed in Item 26 of this Registration Statement (with the exception of the T.Rowe Price Associates Foundation, Inc.), and all oth er investment companies in the T.Rowe Price family of mutual funds. In addition to the corporate insureds, the policies also cover the officers, directors, and employees of the Manager, its subsidiaries, and affiliates. The premium is allocated among the named corporate insureds in accordance with the provisions of Rule 17d1(d)(7) under the Investment Company Act of 1940.

General. The Charter of the Corporation provides that to the fullest extent permitted by Maryland or federal law, no director or officer of the Corporation shall be personally liable to the Corporation or the holders of Shares for money damages and each director and officer shall be indemnified by the Corporation; provided, however, that nothing therein shall be deemed to protect any director or officer of the Corporation against any liability to the Corporation of the holders of Shares to which such director or officer would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence or reckless disregard of the duties involved in the conduct of his or her office.

Article X, Section 10.01 of the Registrant`s By-Laws provides as follows:

Section 10.01. Indemnification and Payment of Expenses in Advance: The Corporation sh all indemnify any individual ("Indemnitee") who is a present or former director, officer, employee, or agent of the Corporation, or who is or has been serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, who, by reason of his position was, is, or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (hereinafter collectively referred to as a "Proceeding") against any judgments, penalties, fines, settlements, and reasonable expenses (including attorneys` fees) incurred by such Indemnitee in connection with any Proceeding, to the fullest extent that such indemnification may be lawful under Maryland law. The Corporation shall pay any reasonable expenses so incurred by such Indemnitee in defending a Proceeding in advance of the final disposition thereof to the fullest extent that such advance payment may be lawful under Maryland law. Subject to any applicable limitations and requirements set forth in the Corporation`s Articles of Incorporation and in these By-Laws, any payment of indemnification or advan ce of expenses shall be made in accordance with the procedures set forth in Maryland law.

Notwithstanding the foregoing, nothing herein shall protect or purport to protect any Indemnitee against any liability to which he would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of his office ("Disabling Conduct").

Anything in this Article X to the contrary notwithstanding, no indemnification shall be made by the Corporation to any Indemnitee unless:

(a)there is a final decision on the merits by a court or other body before whom the Proceeding was brought that the Indemnitee was not liable by reason of Disabling Conduct; or

(b)in the absence of such a decision, there is a reasonable determination, based upon a review of the facts, that the Indemnitee was not liable by reason of Disabling Conduct, which determination shall be made by:

(i)the vote of a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act, nor parties to the Proceeding; or

(ii)an independent legal counsel in a written opinion.

Anything in this Article X to the contrary notwithstanding, any advance of expenses by the Corporation to any Indemnitee shall be made only upon the undertaking by such Indemnitee to repay the advance unless it is ultimately determined that such Indemnitee is entitled to indemnification as above provided, and only if one of the following conditions is met:

(a)the Indemnitee provides a security for his undertaking; or

(b)the Corporation shall be insured against losses arising by reason of any lawful advances; or

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(c)there is a determination, based on a review of readily available facts, that there is reason to believe that the In demnitee will ultimately be found entitled to indemnification, which determination shall be made by:

(i)a majority of a quorum of directors who are neither "interested persons" of the Corporation as defined in Section 2(a)(19) of the Investment Company Act, nor parties to the Proceeding; or

(ii)an independent legal counsel in a written opinion.

Section 10.02. Insurance of Officers, Directors, Employees, and Agents. To the fullest extent permitted by applicable Maryland law and by Section 17(h) of the Investment Company Act of 1940, as from time to time amended, the Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agen t of the Corporation, or who is or was serving at the request of the Corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, against any liability asserted against him and incurred by him in or arising out of his position, whether or not the Corporation would have the power to indemnify him against such liability.

Insofar as indemnification for liability arising under the Securities Act of 1933 may be permitted to directors, officers, and controlling persons of the Registrant pu rsuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit, or proceeding) is asserted by such director, officer, or controlling person in connection with the securities being registered, the Registrant will, unl ess in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

Item 16. Exhibits

(1)(a)Articles of Incorporation of Registrant, dated July 1, 1983 (electronically filed with Amendment No. 19 dated April 25, 1994)

(1)(b)Articles of Amendment, dated April 28, 1976, May 1, 1981, July 1, 1983 (electronically filed with Amendment No. 19 dated April 25, 1994)

(1)(c)Articles Supplementary, dated November 7, 1991 (electronically filed with Amendment No. 19 dated April25, 1994)

(1)(d)Articles of Amendment, dated October 16, 1998 (electronically filed with Amendment No. 25 dated September 30, 1999)

(1)(e)Articles Supplementary, dated September5, 2002(electronically filed with Amendment No.29 dated September 27, 2002)

(1)(f)Articles Supplementary, dated June30, 2005 (electronically filed with Amendment No.32 dated September26, 2005)

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(2)By-Laws of Registrant, as amended November 28, 1973, January 24, 1979, May1, 1981, January21, 1982, January1, 1983, January21, 1988, April20, 1990, July1, 1991, July20, 1993, January18, 1994, July 21, 1999, October16, 2002, February 5, 2003, April21, 2004, and February8, 2005 is incorporated herein by reference to Exhibit (2) of the Registrant`s Registration Statement on Form N-14 filed on March 10, 2006

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(3)Inapplicable

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(4)Form of Agreement and Plan of Reorganization as Appendix A to Proxy Statement and Prospectus is incorporated herein by reference to Exhibit (4) of the Registrant`s Registration Statement on Form N-14 filed on March 10, 2006

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(5)Article SEVENTH, Section I--Issue of the Corporation's Shares and Section II--Redemption and Repurchase of the Corporation's Shares, in their entirety, from the Registrant's Articles of Incorporation, is hereby incorporated by referenced from Amendment No. 19 electronically filed and dated April 25, 1994 and Article II, Stockholders, in its entirety, and Article VIII, Capital Stock, in its entirety, from the Registrant's By-Laws,

are also hereby incorporated by reference from Amendment No. 19 electronically filed and dated April25, 1994

(6)(a)Investment Management Agreement between Registrant and T.Rowe Price Associates, Inc., dated July1, 1987 (electronically filed with Amendment No. 19 dated April25, 1994)

(6)(b)Amended Investment Management Agreement between Registrant and T.Rowe Price Associates, Inc., dated August1, 2004 (electronically filed with Amendment No.31 dated September29, 2004)

(7)Underwriting Agreement between Registrant and T.Rowe Price Investment Services, Inc., dated May 1, 2003 (electronically filed with Amendment No.30 dated September 26, 2003)

(8)Inapplicable

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(9)(a)Custodian Agreement between T.Rowe Price Funds and State Street Bank and Trust Company, dated January28, 1998, as amended November4, 1998, April21, 1999, February9, 2000, April19, 2000, July18, 2000, October25, 2000, February7, 2001, June7, 2001, July24, 2001, April24, 2002, July 24, 2002,September4, 2002, July23, 2003, October22, 2003,February4, 2004, September 20, 2004, March2, 2005, and April 19, 2006

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(9)(b)Global Custody Agreement between The Chase Manhattan Bank and T.Rowe Price Funds, dated January3, 1994, as amended April18, 1994, August15, 1994, November28, 1994, May31, 1995, November1, 1995, July31, 1996, July23, 1997, September3, 1997, October29, 1997, December15, 1998, October6, 1999, February9, 2000, April19, 2000, July18, 2000, Octob er25, 2000, July24, 2001, April 24, 2002, July 24, 2002,July 23, 2003, October22, 2003, September20, 2004,January1, 2005, and December14, 2005 is incorporated herein by reference to Exhibit (9)(b) of the Registrant`s Registration Statement on Form N-14 filed on March 10, 2006

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(10)(a)Rule 12b-1 Plan for the T.Rowe Price New Income Fund—Advisor Class dated May 1, 2003 (electronically filed with Amendment No.30 dated September 26, 2003)

(10)(b)Rule 12b-1 Plan for the T.Rowe Price New Income Fund—RClass dated May 1, 2003 (electronically filed with Amendment No.30 dated September 26, 2003)

(10)(c)Form of Selling Agreement to be used by T.Rowe Price Investment Services, Inc. (electronically filed with Amendment No. 28 dated September4, 2002)

(10)(d)Rule 18f-3 Plan for the T.Rowe Price New Income Fund—Advisor Class and R Class dated July 24, 2002 (electronically filed with Amendment No. 28 dated September4, 2002)

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(11)Opinion of Counsel as to the legality of securities - Henry H. Hopkins, Esq. is incorporated herein by reference to Exhibit (11) to the Registrant`s Registration Statement on Form N-14 filed on March 10, 2006

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(12)Opinion and Consent of Ropes & Gray, LLP for acquired fund regarding certain tax matters, filed herewith

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(13)(a)Transfer Agency and Service Agreement between T.Rowe Price Services, Inc. and T.Rowe Price Funds, dated January 1, 2006, as amended February7, 2006 and April 19, 2006

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(13)(b)Agreement between T.Rowe Price Associates, Inc. and T.Rowe Price Funds for Fund Accounting Services, dated January 1, 2006, as amended February7, 2006 and April 19, 2006

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(13)(c)Agreement between T.Rowe Price Retirement Plan Services, Inc. and the T.Rowe Price Funds, dated January1, 2006, as amended April 19, 2006

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(14)(a)Consent of Independent Registered Public Accounting Firm for acquired fund - PricewaterhouseCoopers LLP is incorporated herein by reference to Exhibit 14(a) to the Registrant`s Registration Statement on Form N-14 filed on March 10, 2006

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(14)(b)Consent of Independent Registered Public Accounting Firm for Registrant - PricewaterhouseCoopers LLP is incorporated herein by reference to Exhibit 14(b) to the Registrant`s Registration Statement on Form N-14 filed on March 10, 2006

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(15)Inapplicable

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(16)Power of Attorney

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(17)Forms of Proxy Ballot are incorporated herein by reference to Exhibit (17) to the Registrant`s Registration Statement on Form N-14 filed on March 10, 2006

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Item 17. Undertakings

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(1) The undersigned registrants agree that prior to any public reoffering of the securities registered through the use of a prospectus which is part of this registration statement by any person or party who is deemed to be an underwriter with the meaning of Rule 145(c) of the Securities Act, the reoffering prospectus will contain the information called for by the applicable registration form for reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form.

(2) The undersigned registrants agree that every prospectus that is filed under paragraph (1) above will be filed as part of an amendment to the registration statements and will not be used until the amendment is effective, and that, in determining any liability under the 1933 Act, each post-effective amendment shall be deemed to be a new registration statement for the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering of them.

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As required by the Securities Act of 1933, as amended, the Registrant certifies that it meets all of the requirements for this Post-Effective Amendment No. 1 to this Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933, as amended, and has duly caused this Post-Effective Amendment No. 1 to the Registration Statement on Form N-14 to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Baltimore, State of Maryland, this August 25, 2006.

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T. Rowe Price New Income Fund, Inc.

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/s/Edward C. BernardBy:Edward C. BernardChairman of the Board

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As required by the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated:<R>

Signature	Title	Date
/s/Edward C. BernardEdward C. Bernard	Chairman of the Board(Chief Executive Officer)	August 25, 2006
/s/Joseph A. CarrierJoseph A. Carrier	< font style="font-size:10.0pt;" face="Berkeley Book" color="Black"> Treasurer (ChiefFinancial Officer)	August 25, 2006
*Jeremiah E. Casey	Director	August 25, 2006
*Anthony W. Deering	Director	August 25, 2006
*Donald W. Dick, Jr.	Director	August 25, 2006
*David K. Fagin	Director	August 25, 2006
*Karen N. Horn	Director	August 25, 2006
/s/Mary J. MillerMary J. Miller	Director	August 25, 2006
*Theo C. Rodgers	Director	August 25, 2006
*John G. Schreiber	Director	August 25, 2006
*/s/Henry H. HopkinsHenry H. Hopkins	Vice President andAttorneyInFact	August 25, 2006

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EX-99.12 TAX OPINION

June 19, 2006

Preferred Fixed Income FundThe Preferred Group of Mutual Funds411 Hamilton Boulevard, Suite 1200Peoria, IL 61602

T. Rowe Price New Income Fund, Inc.100 East Pratt StreetBaltimore, MD 21202

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Ladies and Gentlemen:

We have acted as counsel in connection with the Agreement and Plan of Reorganization (the "Agreement") dated as of April 24, 2006 between the Preferred Group of Mutual Funds, a Massachusetts Business Trust ("Target Trust" or the "Preferred Group"), on behalf of one of its series, Preferred Fixed Income Fund ("Target Fund," the Preferred Group series of portfolios together are "Target Funds" or the "Preferred Funds")), and T. Rowe Price New Income Fund, Inc., a Maryland corporation ("Acquiring Fund"). The Agreement describes a transaction (the "Transaction") to occur as of the date of this letter (the "Closing Date"), pursuant to which Acquiring Fund will acquire the assets of Target Fund as set forth in paragraph 1.2 of the Agreement in exchange for shares of beneficial interest in Acquiring Fund (the "Acquiring Fund Shares") following which the Acquiring Fund Shares received by Target Fund will be distributed by Target Fund to its shareholders in liquidation and termination of Target Fund. This opinion as to certain U.S. federal income tax consequences of the Transaction is furnished to you pursuant to Section 8.5 of the Agreement. Capitalized terms not defined herein are used herein as defined in the Agreement.

Target Fund is a series of Target Trust, which is registered under the Investment Company Act of 1940, as amended (the "1940 Act"), as an open-end management investment company. Shares of Target Fund are redeemable at net asset value at each shareholder`s option. Target Fund has elected to be a regulated investment company ("RIC") for federal income tax purposes under Section 851 of the Internal Revenue Code of 1986, as amended (the "Code").

Acquiring Fund is registered under the 1940 Act as an open-end management investment company. Shares of Acquiring Fund are redeemable at net asset value at each shareholder's option. Acquiring Fund has elected to be a regulated investment company for federal income tax purposes under Section 851 of the Code.

For purposes of this opinion, we have considered the Agreement, the Combined Prospectus/Proxy Statement dated as of April 28, 2006 (the "Combined Proxy Statement") and those documents listed in Appendix A attached hereto. In addition, each of (a) Caterpillar Investment Management Ltd. ("CIML"), a wholly owned subsidiary of Caterpillar Inc. ("Caterpillar"), and the investment advisor of Target Trust, (b) the Benefit Funds Committee of Caterpillar (the "Committee" ), a fiduciary of the defined contribution retirement and other benefit plans that Caterpillar offers its employees (the "Caterpillar Plans"), (c) the Board of Trustees of the Preferred Group (the "Trustees"), (d) T. Rowe Price Associates, Inc., a Maryland corporation and wholly owned subsidiary of T. Rowe Price Group Inc., and the investment advisor for Acquiring Fund ("Acquiring Fund Investment Advisor"), (e) Target Trust on behalf of Target Fund, and (f) Acquiring Fund has provided us with letters dated as of the date hereof (the "Representation Letters"), r epresenting as to certain facts, occurrences and information upon which each of the respective entities above has indicated that we may rely in rendering this opinion (whether or not contained or reflected in the documents and items referred to above).

The facts represented to us in the Representation Letters support the conclusion that, based on the analysis and subject to the considerations set forth below, while the matter is not free from doubt, the Transaction should constitute a reorganization within the meaning of Section 368(a)(1). The reorganization`s consequences to Target Fund shareholders, Target Fund, and Acquiring Fund are set forth more fully below.

Pre-Reorganization Redemption

As noted in the Representation Letters and the Combined Proxy Statement, the Caterpillar Plans (through the Caterpillar Investment Trust (which holds assets of the Caterpillar Plans)) owned a majority of the outstanding shares of each Target Fund other than the Preferred International Value Fund, as of the Record Date (as defined in the Combined Proxy Statement), either directly, or through their ownership interest in the Preferred Stable Principal Collective Trust (the "Preferred Collective Trust"). Within 30 days prior to the Transaction`s Closing Date, the Target Funds redeemed the Caterpillar Investment Trust`s direct and indirect investments in each of the Target Funds (such investments, the "Caterpillar Plan Shares" and such redemptions, the "Pre-Reorganization Redemptions"). We believe that these Pre-Reorganization Redemptions should not be considered a part of the plan of the reorganization between Target and Acquiring Fund, either as part of the Agreement itself or as part of an informal plan among CIML, Target Fund, Acquiring Fund, and Acquiring Fund Investment Advisor regarding the potential transfer of Target Funds` assets to each of ten portfolios offered by T. Rowe Price Group Inc. (the potential transfer, the "Proposed Reorganization") that the respective parties set in motion through discussions beginning on October 31, 2005. Rather, the Pre-Reorganization Redemptions should be viewed as a separate transaction excluded from the determination of both (a) whether Target Fund has transferred "substantially all" of its assets to Acquiring Fund in the Transaction and (b) whether a substantial part of the value of the proprietary interests in Target Fund has been

preserved in the Transaction (two conditions required to be satisfied so that the Transaction may qualify as a reorganization under section 368(a)(1)).

The facts as represented to us in the Representation Letters support our conclusion. According to the Committee, it decided to redeem the Caterpillar Plan Shares to seek new investment opportunities for the Caterpillar Plans. The Committee made its decision thereto on o r before October 13, 2005, prior to any discussions among CIML, Target Fund, Acquiring Fund, Acquiring Fund Investment Advisor, and their respective representatives and advisors concerning the Proposed Reorganization. In deciding on or before October 13, 2005 to redeem the Caterpillar Plan Shares, the Committee acted without any counsel or encouragement from any of CIML, Target Fund, the Trustees, Acquiring Fund or Acquiring Fund Investment Advisor. As a result of the Committee` decision to redeem the Caterpillar Plan Shares as well as Caterpillar`s decision on or prior to October 12, 2005 to exit the investment management business, CIML began to explore various alternatives to propose to the Trustees for the management or disposition of the Preferred Funds, including changing investment advisors, liquidation, sale or merger. Although CIML and the Trustees considered the Proposed Reorganization, and the Trustees approved the Proposed Reorganization, in part in response to the Committee`s decision to redeem the Caterpillar Plan Shares, neither CIML, the Trustees, Acquiring Fund, nor Acquiring Fund Investment Adviso r initiated the Pre-Reorganization Redemptions as part of the Proposed Reorganization.

Substantially all the Properties Test

To qualify as a reorganization under section 368(a)(1)(C) (a "C Reorganization") or an acquisitive reorganization under section 368(a)(1)(D) (an "acquisitive D Reorganization"), a target corporation must transfer "substantially all of its properties" or "substantially all of its assets," respectively, to the acquiring corporation. The Code and the regulations thereunder do not define "substantially all" the properties or assets of a corporation. Instead, those terms are properly interpreted by reference to the purpose(s) of these requirements, which are to ensure that these asset transfers, transactions having the effect of mergers but that were unable to be structured as such under state law, bear a "real semblance" to a "merger or consolidation" (the original definition of a reorganization), and (b) the asset transfer does not serve as a means of effecting a divisive transaction without meeting the requirements of Section 355 and 368(a)(1)(D). For purposes of receiving a private letter ruling that a transaction qualifies as a C Reorganization or acquisitive D Reorganization, Revenue Procedure 77-37, published by the

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T. Rowe Price New Income Fund, Inc.

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Internal Revenue Service ("IRS" or the "Service"), states that a transaction will satisfy the "substantially all" requirement "if there is a transferxc9 of assets representing at least 90 percent of the fair market value of the net assets and at least 70 percent of the fair market value of the gross assets held by the corporation immediately prior to the transfer." The Revenue Procedure states that for purposes of this "90/70 test", "all redemptions and distributions (except for regular, normal dividends) made by Target will be included as assets of Target... immediately prior to the transaction." Revenue Procedure 77-37 clarifies that assets distributed in redemption will be considered as assets held by the corporation immediately prior to the transfer of the target`s assets only when the redemptions "are part of the plan of reorganization." This clarification reflects the historical application of the "substantially all" the properties test to target asset transfers pursuant to the pre-conceived plan of reorganization rather than to transfers that are separate transactions, independent of the plan.

As redemptions initiated by a shareholder and made pursuant to section 22(e) of the 1940 Act ("Shareholder Demand Redemption"), that in our view are not a part of the plan of the reorganization, the Pre-Reorganization Redemptions should be viewed as a separate transaction excluded from the analysis of whether Target Funds have transferred "substantially all of [their] properties" to Acquiring Funds in a tax-free C or acquisitive D reorganization.Unlike traditional corporations, RICs that are open-end registered investment management companies, such as the Preferred Group, are required by the 1940 Act to meet all shareholder redemption requests on demand.Section 22(e) of the 1940 Act provides that, except under certain limited circumstances:

[n]o registered investment company shall suspend the right of redemption, or postpone the date of paymen t or satisfaction upon redemption of any redeemable security in accordance with its terms for more than seven days after the tender of such security to the company or its agent designated for that purpose for redemption.

There is no direct published authority (on which taxpayers are entitled to rely) confirming our conclusion that a significant Shareholder Demand Redemption made prior to a reorganization such as the Pre-Reorganization Redemption should be viewed as a separate transaction excluded from the determination of whether Target Fund has transferred "substantially all" of its properties to Acquiring Fund. In Revenue Ruling 56-345, however, the Service concluded that a post-reorganization redemption of 26% of the stock issued by an acquiring RIC constituting a Shareholder Demand Redemption was not "part of a pre-conceived plan" but rather a transaction separate from the reorganization, excluded from the determination of whether a previous asset transfer met the "substantially all" the properties requirement, wh ere the redemption occurred pursuant to a solicitation made by a third, unrelated RIC to exchange such redeeming shareholders` acquiring RIC shares for its own shares. In reaching its conclusion, the Service noted that (i) the actual plan of reorganization between the target and acquiring RIC ("M" and "N," respectively) did not mention the third party RIC (O) offer to acquire stock of the acquiring RIC (N) in exchange for O shares, (ii) N made no commitment prior to the reorganization to redeem such stock after the reorganization, and (iii) N had not agreed to pay the target shareholders cash for the target (M) stock. Although Revenue Ruling 56345 involves a postreorganization redemption rather than a prereorganization redemption, it demonstrates that substantial Shareholder Demand Redemptions close to a reorganization need not be taken into account for the "substantially all" the properties test where such redemptions are not part of the plan of reorganization involving the target or acquiring RIC.

In recent private letter rulings, the Service has allowed RICs to exclude from the determination of whether a purported reorganization meets the Revenue Procedure 90/70 test interpreting the "substantially all" the properties requirement "redemptions in the ordinary course of Target Fund`s business as an open-end investment company pursuant to xa4 22(e) of the 1940 Act." In addition, in a 1999 private letter ruling, the Service allowed a taxpayer to exclude from the determination of whether the transaction met the 90/70 test all "amounts paid by Targetxc9 [for] redemptions that Target, as an open-end investment company, makes when its shares are

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T. Rowe Price New Income Fund, Inc.

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presented to it for redemption pursuant to section 22(e) of the Act" so that a 42% Shareholder Demand Redemption made a few days prior to the reorganization and apparently in response to a target RIC`s decision to transfer its assets to an acquiring RIC did not cause the subsequent asset transfer to violate the 90/70 test. Written determinations such as private letter rulings do not have the force of law and may not be used or cited as precedent. Nevertheless, the trend in private letter rulings providing exclusion from consideration for (a) redemptions that are made in the ordinary course of a target`s business as an open-end RIC, and (b) all Shareholder Demand Redemptions in the 1999 letter ruling discussed above, is helpful in that it reflects what would appear to be the Service`s growing comfort that redemptions made pursuant to section 22(e) of the 1940 Act that are not a part of the plan of reorganization do not raise the concerns that are generally addressed by the "substantially all" the properties test. As noted above, in the case of the Pre-Reorganization Redemptions, the Committee decided to redeem the Caterpillar Plan Shares prior to any discussion of the Proposed Reorganization. In our view, this fact and other facts represented to us in the Representation Letters support the conclusion that the Pre-Reorganization Redemptions were not a part of the plan of the Proposed Reorganization. Based on the Service`s views expressed in the above rulings, the Pre-Reorganization Redemptions should therefore be viewed as a separate and independent transaction excluded from the determination of whether Target Fund has transferred "substantially all" of its properties to Acquiring Fund.

In four companion private letter rulings issued in February 2006 on the qualification of reorganizations between RICs (the "2006 Letter Rulings"), however, the taxpayers in question included in the determination of whether a purported C reorganization met the 90/70 test, amounts distributed in redemption of a target RIC`s shares to "Shareholder C," an "affiliate" of the target RIC`s investment advisor who owned prior to the redemption more than 40 or 50 percent of target RIC`s stock; it may well be that the IRS required them to do so as a condition to granting a favorable ruling. Prior to the purported reorganizations in question (the "Letter Ruling Reorganizations"), Shareholder C redeemed, exclusively for cash, shares representing up to 10 percent of the net asset value of the target RIC (the "Affiliate Redemption"). The taxpayers in question agreed to take the Affiliate Redemptions into account "by treating the Target Fund as if it had distributed, immediately prior to the [Letter Ruling Reorganization], a percentage of its net and gross assets, respectively, equal to the actual percentage of the Target Fund`s net and gross assets distributed to Shareholder C on the date of the [Affiliate Redemption]."

We believe that if the IRS required the taxpayers to include the Affiliate Redemptions in the determination of whether the Letter Ruling Reorganization met the 90/70 test, such a

requirement should not apply to the Transaction. The RICs seeking the rulings that the transfer of assets to the acquiring RICs qualified as a tax-free reorganization apparently conceded in each ruling`s facts that the "affiliate" Shareholder Demand Redemption was made in connection with the Letter Ruling Reorganization. As noted above, in our view, the facts in the instant case indicate that the Pre-Reorganization Redemptions were not a part of a plan of the Proposed Reorganization and not made in connection with the Transaction. The Committee decided to redeem the Caterpillar Plan Shares on or prior to October 13, 2005, before any discussions concerning the Proposed Reorganization. Although the Pre-Reorganization Redemptions occurred within three weeks of the Transaction, in May and June 2006, respectively, it is our understanding that the Committee did not effectuate the Pre-Reorganization Redemptions until then in part because it had a duty to analyze and consider fully the different investment alternatives for the Caterpillar Plans before presenting the Caterpillar Plan Shares for redemption. Thus, the facts in the 2006 Letter Rulings are distinguishable from the facts concerning the Pre-Reorganization Redemptions.

The Service`s views expressed in the 2006 Letter Rulings should be limited to the facts of the rulings. The inclusion of the Affiliate Redemptions in applying the 90/70 test did not bear on the IRS`s ultimate conclusion in the rulings. The "affiliat e," Shareholder C, redeemed shares representing less than 10% of the net asset value of target RIC. Thus, the transactions in the rulings satisfy the 90/70 test whether or not the Affiliate Redemptions were integrated with the reorganization and taken into account for purposes of applying the 90/70 test. Requiring the Affiliate Redemption`s inclusion for purposes of the 90/70 test was therefore unnecessary to the IRS`s ruling in the 2006 Letter Rulings that each transaction qualified as a C Reorganization. The taxpayers in question may have acquiesced to mak ing such a representation because by doing so, they would still receive a positive ruling. Other taxpayers with different facts may not need to make such a representation. One should not therefore expand the application of the representation in the 2006 Letter Rulings, to apply, for example, to all redemptions made prior to a reorganization by an affiliate of the target RIC (where an affiliate is an entity related to the Target RIC or its investment advisor).

In addition, if the Service required the taxpayers in the 2006 Letter Rulings to include the Affiliate Redemptions in applying the 90/70 test, this requirement should not apply to the Pre-Reorganization Redemptions because, as noted above, private letter rulings are not binding authority, and so only the taxpayers seeking a private letter ruling may rely on the rulings result. Prior cases and IRS rulings have included in the determination of whether a target corporation satisfies the substantially all the properties test only distributions such as redemptions that are part of the plan of reorganization. Because the Pre-Reorganization Redemptions were not in our view, based on the facts presented to us, part of the plan between a target and acquiring RIC and not made in connection with the Proposed Reorganization, any IRS views expressed regarding the Affiliate Redemptions in the 2006 Letter Rulings should not apply to the Pre-Reorganization Redemptions.

Preferred Fixed Income Fund

T. Rowe Price New Income Fund, Inc.

7

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Continuity of Interest Test

In addition to transferring "substantially all of its properties," Target Fund shareholders must satisfy the continuity of shareholder interest ("COI") requirement so that the Transaction qualifies as a reorganization under section 368(a)(1). For purposes of receiving a private letter ruling, Revenue Procedure 77-37 states that a transaction will satisfy the COI requirement if there is continuing interest through stock ownership in the transferee corporation "on the part of the former shareholders of [the transferor corporation] which is equal in value, as of the effective date of the reorganization, to at least 50 percent of the value of all of the formerly outstanding stock of the transferor corporation as of the same date." The Revenue Procedure clarifies that, "sales, redemptions and other dispositions of stock occurring prior or subsequent to the exchange which are part of the plan of reorganization will be considered in determining whether there is a 50 percent continuing interest through stock ownership as of the effective date of the reorganization." Treasury Regulations finalized in 2000 on the COI requirement further clarify that pre-reorganization redemptions of target stock will count against the COI requirement only if the amounts received by the target shareholder are treated as "other property or money received in the exchange for purposes of section 356 (or would be so treated if the target shareholder received stock of the acquiring corporation in exchange for its stock in the target corporation)."

As a separate transaction that in our view is not part of the plan of the Proposed Reorganization, the Pre-Reorganization Redemptions should be excluded from the determination of whether continuity of interest in Target Fund has been preserved in the Transaction. In addition, Target Fund did not use proceeds from Acquiring Fund or borrow money to satisfy the Pre-Reorganization Redemptions, where such borrowings may subsequently be assumed or repaid by Acquiring Fund and suggest an indirect form of consideration in the Transaction.Rather, Target Fund satisfied the Pre-Reorganization Redemptions with an in-kind distribution of Target Fund`s assets. Thus, amounts received in the Pre-Reorganization Redemptions should not be treated as "other property or money received in the exchange" (i.e., "boot") "for purposes of section 356 (or would be so treated if the target shareholder received stock of the

acquiring corporation in exchange for its stock in the target corporation)" to affect the continuity of interest in the Transaction.

We note that in the 2006 Letter Rulings, the IRS concluded that the redeeming Shareholder C "[would] recognize gain upon receipt of [the acquiring RIC`s] stock and cash or other property in exchange for target stock, but i n an amount not in excess of the cash and other property it receives (xa4 356(a)(2))," i.e., the proceeds from the affiliate shareholder redemption were boot in the exchange that might affect the target RIC`s continuity of interest in the transaction. While the IRS provides no basis for this conclusion, a similar conclusion should not be reached in the case of the Pre-Reorganization Redemptions. Unlike the Affiliate Redemp tions in the 2006 Letter Rulings, in our view based on the facts presented to us, the Pre-Reorganization Redemptions were not made in connection with, or as part of the plan of, the Proposed Reorganization and were satisfied exclusively by Target Fund with an in-kind distribution of its assets. As such, the Target Fund distributions satisfying the Pre-Reorganization Redemptions should not be considered "other property or money" provided in the exchange. Thus, the facts in the 2006 Letter Rulings are distinguishable from the facts surrounding the Pre-Reorganiz ation Redemptions.

Therefore, as stated above, the Transaction should meet the "substantially all" the properties requirement and continuity of interest requirement of Section 368(a)(1) of the Code.

Continuity of Business Enterprise Test

Further, the facts you have represented as to in paragraph 8 of the letter from Acquiring Fund and paragraph 9 of the letter from Target Fund, each dated as of the date hereof, support the conclusion that, following the Transaction, Acquiring Fund will continue the historic business of Target Fund as an open-end investment company that seeks to maximize total return consistent with prudent investment management by investing in debt securities.

Various factors demonstrate the similarity between Target Fund and Acquiring Fund. The two funds have similar investment styles: Morningstar categorized both funds as "Intermediate-Term Bond" funds as of September 30, 2005 (the "comparison date"), a randomly selected date that reflects the funds` portfolios composed without reference to the Transaction. For purposes of the Morningstar Style Box, Target Fund`s investment style was characterized as "Intermediate Duration-Medium Quality," while Acquiring Fund`s was characterized as "Intermediate Duration-High Quality." As one would expect from bond funds, as of the comparison date each

Preferred Fixed Income Fund

T. Rowe Price New Income Fund, Inc.

9

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fund invested at least 79% of its net assets in bonds, between 11.7% and 20.1% in cash, and less than 0.8% in other assets.

A comparison of the funds` portfolios indicates that, consistent with the funds` shared goals and strategies, the funds hold securities with similar characteristics. First, as of the comparison date, the funds had similar overall yields (3.7% for Target Fund and 4.2% for Acquiring Fund) and very similar average yields to maturity (5.2% for Target Fund and 4.9% for Acquiring Fund). Yield to maturity ("YTM") is a method of measuring the total yield of a bond that takes into account both coupon payments and amortization or accretion from the time of purchase until maturity (i.e., the average rate of return that will be earned on a bond if held to maturity). The fact that the funds have similar YTMs shows t he similarity between the funds` bond portfolios with respect to annual coupon payments and number of years to maturity. As of the comparison date, the average coupons of the funds` portfolios were identical at 5.2%.

With respect to maturity, the funds` portfolios are also similar. As of the comparison date, the funds had similar average maturities: 6.5 years for Target Fund and 7.2 years for Acquiring Fund, placing both funds within the Morningstar intermediate-term category for bond portfolios.When compared in terms of the percentage of net assets that each fund invested in securities of varying maturities, there was a total overlap of 53.6%. That overlap consisted of 6.5% in securities with maturities of 1-3 years, 15.2% in securities with maturities of 3-5 years, 7.6% in securities with maturities of 5-7 years, 11.0% in securities with maturities of 7-10 years, 5.0% in securities with maturities of 10-20 years, 8.2% in securities with maturities of 20-30 years, and essentially no investme nts in securities with maturities of 30 years and over.

Next, the funds` portfolios are similar in terms of credit quality and duration. As of the comparison date, the average credit rating of Target Fund was A, while that of Acquiring Fund

was AAA. The credit ratings of the funds` individual investments overlapped by a total of 73.5%. Specifically, there was an overlap of 58.2% in government bonds and AAA-rated investments, 1.6% in AA-rated investments, 3.4% in A-rated investments, 8.6% in BBB-rated investments, 1.7% in BB-rated investments, and no overlap in investments rated B and below. In addition, as of the comparison date, the average effective durations of the funds were similar (3.8 years for Target Fund and 4.5 years for Acquiring Fund), again placing both funds within the Morningstar intermediate-term category for bond funds.

The funds` portfolios are also similar in terms of diversification among different kinds of fixed-income securities. As of the comparison date, the funds shared a total overlap of 88.6% over the fixed-income classes, consisting of 15.4% in U.S. Government securities, 37.0% in mortgage-backed assets and collateralized mortgage obligations, 21.2% in U.S. corporate, asset-backed, convertible and municipal securities, 3.0% in foreign securities, and 12.0% in cash.

Consistent with the similarity of investment strategies, the funds bear similar risk profiles. As of the comparison date, the funds had similar correlations with the Lehman Brothers Aggregate Index, with a beta of 1.07 for the Target Fund and 0.96 for Acquiring Fund. In addition, Target Fund and Acquiring Fund shared the same "best fit" index, the Lehman Brothers U.S. Universal Bond Index, with comparable betas of 1.09 and 0.97, respectively.

The specific characteristics described above (the relative figures and percentages in terms of asset allocation, yield, yield to maturity, maturity, credit quality, duration, sector diversification, and risk profile) do not constitute fixed aspects of Target Fund and Acquiring Fund`s investment strategies. Rather, they reflect the fact that the funds` similar investment strategies have led them to react similarly (by choosing similar portfolios) to the market conditions in place up until the comparison date.

Preferred Fixed Income Fund

T. Rowe Price New Income Fund, Inc.

11

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Consistent with the similarity of the funds, on the date of the Transaction, at least 33 1/3% of Target Fund`s portfolio assets as they existed prior to any realignment occurring in connection with the Transaction will not be required to be sold by virtue of the investment objectives, strategies, policies, risks or restrictions of Acquiring Fund, and the Target Fund will not have realigned its portfolio prior to the Transaction in order for this to be true. Acquiring Fund has no plan or intention to change any of its investment objectives, strategies, policies, risks or restrictions after the Transaction. After the Transaction, Acquiring Fund will invest all assets acquired from Target Fund in a manner consistent with the funds` shared investment strategies, as described above and reflected by the aforementioned portfolio data.

Opinion

Based on t he foregoing representations and assumptions, our review of the documents and items referred to above, and for the reasons stated above, we are of the opinion that, although the matter is not free from doubt, generally, subject to the final paragraphs hereof, for U.S. federal income tax purposes:

The Transaction should constitute a reorganization within the meaning of Section 368(a) of the Code, and Acquiring Fund and Target Fund each should be a "party to a reorganization" within the meaning of Section 368(b) of the Code;

Under section 1032 of the Code, no gain or loss should be recognized by Acquiring Fund upon the receipt of the assets of Target Fund in exchange for Acquiring Fund Shares;

Under section 362(b) of the Code, the basis in the hands of Acquiring Fund of the assets of Target Fund transferred to Acquiring Fund in the Transactio n should be the same as the basis of such assets in the hands of Target Fund immediately prior to the transfer;

Under section 1223(2) of the Code, the holding periods of the assets of Target Fund in the hands of Acquiring Fund should include the periods during which such assets were held by Target Fund;

Under section 361 of the Code, no gain or loss should be recognized by Target Fund upon the transfer of Target Fund's assets to Acquiring Fund in exchange for Acquiring Fund Shares, or upon the distribution of Acquiring Fund Shares by Target Fund to its shareholders in liquidation;

Under section 354 of the Code, no gain or loss should be recognized by Target Fund shareholders upon the exchange of their Target Fund shares for Acquiring Fund Shares;

< div style="text-align:Left;margin-left:0.0";margin-right:0.0";text-indent:0.0";width:100%">

Under section 358 of the Code, the aggregate basis of Acquiring Fund Shares a Target Fund shareholder receives in connection with the Transaction should be the same as the aggregate basis of his or her Target Fund shares exchanged therefor;

Under section 1223(1) of the Code, a Target Fund shareholder`s holding period for his or her Acquiring Fund Shares should be determined by including the period for which he or she held the Target Fund shares exchanged therefor, provided that he or she held such Target Fund shares as capital assets; and

Acquiring Fund should succeed to and take into account the items of Target Fund described in Section 381(c) of the Code, subject to the conditions and limitations specified in Sections 381, 382, 383 and 384 of the Code and the Regulations thereunder.

We express no view with respect to the effect of the reorganization on any transferred asset as to which any unrealized gain or loss is required to be recognized at the end of a taxable year (or on the termination or transfer thereof) under federal income tax principles.

We once again call your attention to the 2006 Letter Rulings where the taxpayers in question included a pre-reorganization redemption made by an affiliate of the target RIC`s investment advisor in their determination of whether a transfer of assets to an acquiring RIC met the Revenue Procedure requirements for satisfying the "substantially all" the properties test, i.e. the 90/70 test. As noted above, in the event the IRS required this taxpayer representation, such a requirement should not apply to the Transaction. The IRS`s conclusion in the 2006 Letter Rulings that proceeds distributed in the Affiliate Redemptions were boot delivered in the exchange (suggesting that the redemption affected target shareholders` continuity of interest in the transaction), should also not apply to the Transaction. The taxpayers in question in the 2006 Letter Rulings conceded that the Affiliate Redemptions were made in connection with the Letter Ruling Reorganizations. The facts as provided in the Representation Letters in our view demonstrate that the Pre-Reorganization Redemptions were not made in connection with, or as part of the plan of, the Proposed Reorganization. To the extent the 2006 Letter Rulings stand for the proposition that any redemption made by an affiliate of the target RIC must be integrated with the reorganization itself and included (a) in the determination of whether the target RIC has transferred "substantially all" of its properties to the acquiring RIC or (b) in applying the continuity of interest test, we believe such an inferred conclusion has no basis in the law. Given that prior cases and IRS rulings have included in the determination of whether a target corporation satisfies the "substantially all" the properties test or the continuity of interest test only target or acquirer redemptions that are part of the formal or informal plan of reorganization, and given that the facts in our view indicate the Pre-Reorganization Redemptions were not a part of the plan of the Proposed Reorganization, we believe that any Service view expressed in the 2006 Letter Rulings regarding the Affiliate Redemptions should not apply to the Pre-Reorganization Redemptions. The 2006 Letter Rulings may, however, indicate a view held by the Service that is inconsistent with both our view and prior views expressed by the Service in the recent private

Preferred Fixed Income Fund

T. Rowe Price New Income Fund, Inc.

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letter rulings (discussed above) concerning Shareholder Demand Redemptions made prior to a reorganization. As a result, and as noted above, our opinion is not free from doubt and it is possible that the Service may take a contrary view of the Transaction than that expressed herein.

In addition, we call your attention to Revenue Ruling 87-76, 1987-2 C.B. 84, published by the IRS. In that ruling, the IRS held that the s o-called "continuity of business enterprise" requirement necessary to tax-free reorganization treatment was not met in the case of an acquisition of an investment company which invested in corporate stocks and bonds by an investment company which invested in municipal bonds. Specifically, the IRS based its ruling on its conclusion that the business of investing in corporate stocks and bonds is not the same line of business as investing in municipal bonds. We believe that the IRS`s conclusion in this ruling has always been questionable. In addition, a series of private letter rulings issued in July 2005 suggests that the IRS`s position on this issue is evolving: the IRS relied upon historic business representations to conclude that the reorganization satisfied the continuity of business enterprise requirement. However, even if the IRS`s 1987 revenue ruling were a correct statement of law, the facts of this Transaction are distinguishable from those in the ruling.

We believe that Acquiring Fund and Target Fund are both engaged in the same line of business: each is an open-end investment company that seeks to maximize total return consistent with prudent investment management by investing in debt securities. The funds` portfolios are substantially similar in terms of asset allocation, market capitalization, sector diversification, regional exposure, and risk profile. After the Transaction, Acquiring Fund will continue that line of business for the benefit of the stockholders of both Target and Acquiring Funds. Although Acquiring Fund will dispose of securities formerly held by Target Fund, these dispositions will be < font style="font-size:12.0pt;" face="Times New Roman" color="Black">fully consistent with the shared historic investment policies of both Funds and all proceeds generated by such dispositions will be reinvested in a manner fully consistent with such policies. In these circumstances, we are of the opinion that Acquiring Fund will have continued the historic business of Target Fund for the benefit of, among others, the historic stockholders of Target Fund, and that the continuity of business enterprise doctrine should, as a result, be fulfilled. Because Revenue Ruling 87-76 is the only ruling on which taxpayers can rely (i.e., the only ruling that is not a private letter ruling) dealing specifically with the application of the "continuity of business enterprise" requirement to a reorganization involving investment companies, however, our opinion cannot be free from doubt. No ruling has been or will be obtained from the IRS as to the subject matter of this opinion and there can be no assurance that the IRS or a court of law will concur with the opinion set forth above.

[Rest of page intentionally left blank.]

Our opinion is based on the Internal Revenue Code of 1986, as amended, Treasury Regulations, Internal Revenue Service rulings, judicial decisions, and other applicable authority, all as in effect on the date of this opinion. The legal authorities on which this opinion is based may be changed at any time. Any such changes may be retroactively applied and could modify the opinions expressed above.

Very truly yours,

/s/Ropes & Gray LLP

Ropes & Gray LLP

Preferred Fixed Income Fund

T. Rowe Price New Income Fund, Inc.

15

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Appendix A

Supplement dated October 12, 2005 to the Prospectus of Target Trust dated November 1. 2004

Supplement dated February 16, 2006 to the Prospectus of Target Trust dated November 1, 2004

Letter dated October 12, 2005 from Caterpillar Inc. to the Board of Trustees of Target Trust.

Certificate of Clerk of the Target Trust dated as of the Closing Date as to (i) no amendment to or modification of Declaratio n of Trust; (ii) votes adopted by the Board of Trustees on February 16, 2006; (iii) votes adopted at the Special meeting of Shareholders of the Target Funds on June 9, 2006; and (iv) incumbency of certain officers of the Funds.

Certificate of Secretary or Clerk of the Acquiring Funds dated as of the Closing Date as to (i) no amendment to or modification of the Articles of Incorporation or Declaration of Trust, as applicable; (ii) Bylaws of Acquiring Funds; (iii) votes adopted by the Board of Directors/Trustees on March 8, 2006; and (iv) incumbency of certain officers of the Funds.

See, e.g., Commissioner v. Elkhorn Coal Co., 95 F.2d 732, 738 (1938) (holding that a t ransferor corporation, T, failed to meet the "substantially all" the properties requirement for purposes of a C reorganization, when T spun off unwanted assets by transferring these properties to a newly created corporation prior to transferring the remainder of its assets to acquiring corporation, P, when the facts showed that the incorporation of the new company and transfer made to it "were part of a single plan under which the transfer was made to [P] and that they should be treated as parts of one transaction."); see also Rev. Rul. 2003-79, 2003-29 I.R.B. 80 (upholding the conclusion in Elkhorn Coal Co. with respect to equivalent facts); Rev. Rul. 88-48, 1988-1 C.B. 117 (the Service examined (for purposes of application of the "substantially all" the properties test) a target corporation`s sale of 50% of its historic business assets in a taxable transaction to a third party made as "part of its overall plan" to transfer the cash proceeds from the sale and remaining historic business assets to an acquiring corporation).

EX-99.16 PWR OF ATTY

T. ROWE PRICE BALANCED FUND, INC.T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUSTT. ROWE PRICE CAPITAL APPRECIATION FUNDT. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.T. ROWE PRICE CORPORATE INCOME FUND, INC.T. ROWE PRICE DEVELOPING TECHNOLOGIES FUND, INC.T. ROWE PRICE DIVERSIFIED MID-CAP GROWTH FUND, INC.T. ROWE PRICE DIVERSIFIED SMALL-CAP GROWTH FUND, INC.T. ROWE PRICE DIVIDEND GROWTH FUND, INC.T. ROWE PRICE EQUITY INCOME FUNDT. ROWE PRICE EQUITY SERIES, INC.T. ROWE PRICE FINANCIAL SERVICES FUND, INC.T. ROWE PRICE FIXED INCOME SERIES, INC.T. ROWE PRICE GLOBAL TECHNOLOGY FUND, INC.T. ROWE PRICE GNMA FUNDT. ROWE PRICE GROWTH & INCOME FUND, INC.T. ROWE PRICE GROWTH STOCK FUND, INC.T. ROWE PRICE HEALTH SCIENCES FUND, INC.T. ROWE PRICE HIGH YIELD FUND, INC.T. ROWE PRICE INDEX TRUST, INC. T. ROWE PRICE INFLATION PROTECTED BOND FUND, INC.T. ROWE PRICE INSTITUTIONAL EQUITY FUNDS, INC.T. ROWE PRICE INSTITUTIONAL INCOME FUNDS, INC.T. ROWE PRICE INSTITUTIONAL INTERNATIONAL FUNDS, INC.T. ROWE PRICE INTERNATIONAL FUNDS, INC.T. ROWE PRICE INTERNATIONAL INDEX FUND, INC.T. ROWE PRICE INTERNATIONAL SERIES, INC.T. ROWE PRICE MEDIA & TELECOMMUNICATIONS FUND, INC.T. ROWE PRICE MID-CAP GROWTH FUND, INC.T. ROWE PRICE MID-CAP VALUE FUND, INC.T. ROWE PRICE NEW AMERICA GROWTH FUNDT. ROWE PRICE NEW ERA FUND, INC.T. ROWE PRICE NEW HORIZONS FUND, INC.T. ROWE PRICE NEW INCOME FUND, INC.T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.T. ROWE PRICE PRIME RESERVE FUND, INC.T. ROWE PRICE REAL ESTATE FUND, INC.T. ROWE PRICE RESERVE INVESTMENT FUNDS, INC.T. ROWE PRICE RETIREMENT FUNDS, INC.T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.T. ROWE PRICE SHORT-TE RM BOND FUND, INC.T. ROWE PRICE SHORT-TERM INCOME FUND, INC.T. ROWE PRICE SMALL-CAP STOCK FUND, INC.T. ROWE PRICE SMALL-CAP VALUE FUND, INC.T. ROWE PRICE SPECTRUM FUND, INC.T. ROWE PRICE STATE TAX-FREE INCOME TRUSTT. ROWE PRICE SUMMIT FUNDS, INC.T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.T. ROWE PRICE TAX-EFFICIENT FUNDS, INC.T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.T. ROWE PRICE TAX-FREE INCOME FUND, INC.

T. ROWE PRICE TAX-FREE INTERMEDIATE BOND FUND, INC.T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.T. ROWE PRICE U.S. BOND INDEX FUND, INC.T. ROWE PRICE U.S. TREASURY FUNDS, INC.T. ROWE PRICE VALUE FUND, INC.

POWER OF ATTORNEY

RESOLVED, that the Corporation does hereby constitute and authorize Edward C. Bernard, Joel H. Gold berg and Henry H. Hopkins, and each of them individually, their true and lawful attorneys and agents to take any and all action and execute any and all instruments which said attorneys and agents may deem necessary or advisable to enable the Corporation/Trust to comply with the Securities Act of 1933, as amended, and the Investment Company Act of 1940, as amended, and any rules, regulations, orders or other requirements of the United States Securities and Exchange Commission thereunder, in connection with the registration under the Securities Act of 1933, as amended, of shares of the Corporation/Trust, to be offered by the Corporation/Trust, and the registration of the Corporation/Trust under the Investment Company Act of 1940, as amended, including specifically, but without limitation of the foregoing, power and authority to sign the name of the Corporation/Trust on its behalf, and to sign the names of each of such directors/trustees and officers on his behalf as such director/trustee or officer to any (i)Registration Statement on Form N-1A or N-14 of the Corporation/Trust filed with the Securities and Exchange Commission under the S ecurities Act of 1933, as amended; (ii)Registration Statement on Form N-1A or N-14 of the Corporation/Trust under the Investment Company Act of 1940, as amended; (iii)amendment or supplement (including, but not limited to, Post-Effective Amendments adding additional series or classes of the Corporation/Trust) to said Registration Statement; and (iv)instruments or documents filed or to be filed as a part of or in connection with such Registration Statement, including Articles Supplementary, Articles of Amendment, and other instruments with respect to the Articles of Incorporation or Master Trust Agreement of the Corporation/Trust.

IN WITNESS WHEREOF, the above named Corporations/Trusts have caused these presents to be signed and the same attested by its Secretary, each thereunto duly authorized by its Boa rd of Directors/Trustees, and each of the undersigned has hereunto set his hand and seal as of the day set opposite his name.

ALL CORPORATIONS/TRUSTS
/s/Edward C. BernardEdward C. Bernard	Chairman of the Board (Principal Executive Officer)Director/Trustee	July 19, 2006
/s/Joseph A. CarrierJoseph A. Carrier	Treasurer (Principal Financial Officer)	July 19, 2006
/s/Jeremiah E. CaseyJeremiah E. Casey	Director/Trustee	July 19, 2006
/s/Anthony W. DeeringAnthony W. Deering	Director/Trustee	July 19, 2006
/s/Donald W. Dick, Jr.Donald W. Dick, Jr.	Director/Trustee	July 19, 2006
/s/David K. FaginDavid K. Fagin	Director/Trustee	July 19, 2006
/s/Karen N. HornKaren N. Horn	Director/Trustee	July 19, 2006
/s/Theo C. RodgersTheo C. Rodgers	Director/Trustee	July 19, 2006
/s/John G. SchreiberJohn G. Schreiber	Director/Trustee	July 19, 2006

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Power of AttorneyJuly 19, 2006Page 2

(Signatures Continued)

Power of AttorneyJuly 19, 2006Page 3

TRPPRODEDGAgreementsPower of AttorneyPOA2006.fm

BRIAN C. ROGERS, Director/Trustee

T. ROWE PRICE BALANCED FUND, INC.T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.T. ROWE PRICE CAPITAL APPRECIATION FUNDT. ROWE PRICE DEVELOPING TECHNOLOGIES FUND, INC.T. ROWE PRICE DIVERSIFIED MID-CAP GROWTH FUND, INC.T. ROWE PRICE DIVIDEND GROWTH FUND, INC.T. ROWE PRICE EQUITY INCOME FUNDT. ROWE PRICE FINANCIAL SERVICES FUND, INC.T. ROWE PRICE GLOBAL TECHNOLOGY FUND, INC.T. ROWE PRICE GROWTH & INCOME FUND, INC.T. ROWE PRICE GROWTH STOCK FUND, INC.T. ROWE INDEX TRUST, INC.T. ROWE PRICE INSTITUTIONAL EQUITY FUNDS, INC.T. ROWE PRICE INSTITUTIONAL INTERNATIONAL FUNDS, INC. T. ROWE PRICE INTERNATIONAL FUNDS, INC.T. ROWE PRICE INTERNATIONAL INDEX FUND, INC.T. ROWE PRICE INTERNATIONAL SERIES, INC.T. ROWE PRICE MEDIA & TELECOMMUNICATIONS FUND, INC.T. ROWE PRICE MID-CAP GROWTH FUND, INC.T. ROWE PRICE MID-CAP VALUE FUND, INC.T. ROWE PRICE NEW ERA FUND, INC.T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.T. ROWE PRICE REAL ESTATE FUND, INC.T. ROWE PRICE RETIREMENT FUNDS, INC.T. ROWE PRICE SPECTRUM FUND, INC.T. ROWE PRICE TAX-EFFICIENT FUNDS, INC.T. ROWE PRICE VALUE FUND, INC.

/s/Brian C. RogersBrian C. Rogers
Director/Trustee
July 19, 2006

(Signatures Continued)

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Power of AttorneyJuly 19, 2006Page 4

JOHN H. LAPORTE, Director/Trustee

EX-99.9 CUST CONTRCT

Custodian Agreement

This Agreement is made as of January 28, 1998 by and between each entity set forth on Appendix A hereto (as such Appendix A may be amended from time to time) which executes a copy of this Agreement (each referred to herein as the "Fund"), and State Street Bank and Trust Company, a Massachusetts trust company with its principal place of business at 225 Franklin Street, Boston, Massachusetts 02110 (the "Custodian").

Witnesseth:

Whereas, each Fund desires to retain the Custodian to act as custodian of certain of the assets of the Fund, and the Custodian is willing to provide such services to each Fund, upon the terms and conditions hereinafter set forth; and

Whereas, except as otherwise set forth herein, this Agreement is intended to supersede that certain custodian contract among the parties hereto dated September 28, 1987, as amended; and

Whereas, the Funds have retained Chase Manhattan Bank, N.A. to act as the Funds` custodian with respect to the assets of each such Fund to be held outside of the United States of America (except as otherwise set forth in this Agreement) pursuant to a written custodian agreement (the "Foreign Custodian Agreement"),

Now, Therefore, in consideration of the mutual covenants and agreements hereinafter contained, each of the parties hereto agrees as follows:

Section 1.Employment of Custodian and Property to be Held by It.

Each Fund hereby employs the Custodian as the custodian of certain of its assets, including those securities it desires to be held within the United States of America ("domestic securities") and those securities it desires to be held outside the Unit ed States of America (the "United States") which are (i) not held on the Funds` behalf by Chase Manhattan Bank, N.A. pursuant to the Foreign Custodian Agreement and (ii) described with greater particularity in Section 3 hereof (such securities shall be referred to herein as "foreign securities"). Each Fund agrees to deliver to the Custodian all domestic securities, foreign securities and cash owned by it from time to time, and all payments of income, payments of principal or capital distributions received by it with respect to

securities held by it hereunder, and the cash consideration received by it for such new or treasury shares of capital stock of each Fund as may be issued or sold from time to time ("Shares"). The Custodian shall not be responsible for any property of any Fund held or received by such Fund (i) not delivered to the Custodian, or (ii) held in the custody of Chase Manhattan Bank N.A.

The Custodian is authorized to employ one or more sub-custodians located within the United States, provided that the Custodian shall have obtained the written acknowledgment of the Fund with respect to such employment. The Custodian is authorized to employ sub-custodians loc ated outside the United States as noted on Schedule A attached hereto (as such Schedule A may be amended from time to time). The Custodian shall have no more or less responsibility or liability to any Fund on account of any actions or omissions of any sub-custodian so employed than any such sub-custodian has to the Custodian and shall not release any sub-custodian from any responsibility or liability unless so agreed in writing by the Custodian and the applicable Fund. With the exception of State Street Bank and Trust Company (London branch), the Custodian shall not be liable for losses arising from the bankruptcy, insolvency or receivership of any sub-custodian located outside the United States.

Section 2.Duties of the Custodian with Respect to Property of the Funds Held By the Custodian in the United States.

Section 2.1Holding Securities. The Custodian shall hold and physically segregate for the account of each Fund all non-cash property to be held by it in the United States, including all domestic securities owned by the Fund other than (a) securities which are maintained pursuant to Section 2.9 in a clearing agency which acts as a securities depository or in a book-entry system authorized by the United States Department of the Treasury and certain federal agencies (each, a "U.S. Securities System") and (b) commercial paper of an issuer for which the Custodian acts as issuing and paying agent ("Direct Paper") which is deposited and/or maintained in the Direct Paper system of the Custodian (the "Direct Paper System") pursuant to Section 2.10.

Section 2.2Delivery of Investments. The Custodian shall release and deliver domestic investments owned by a Fund held by the Custodian or in a U.S. Securities System account of the Custodian or in the Custodian`s Direct Paper System account ("Direct Paper System Account") only upon receipt of Proper Instructions, which

may be continuing instructions when agreed to by the parties, and only in the following cases:

1)Upon sale of such investments for the account of the Fund and receipt of payment therefor;

2)Upon the receipt of payment in connection with any repurchase agreement related to such investments entered into by the Fund;

3)In the case of a sale effected through a U.S. Securities System, in accordance with the provisions of Section 2.9 hereof;

4)To the depository agent in connection with tender or other similar offers for portf olio investments of the Fund;

5)To the issuer thereof or its agent when such investments are called, redeemed, retired or otherwise become payable; provided that, in any such case, the cash or other consideration is to be delivered to the Custodian;

6)To the issuer thereof, or its agent, for transfer into the name of the Fund or into the name of any nominee or nominees of the Custodian or into the name or nominee name of any agent appointed pursuant to Section 2.8 or into the name or nominee name of any sub-custodian appointed pursuant to Section 1; or for exchange for a different number of bonds, certificates or other evidence representing the same aggregate face amount or number of units; provided that, in any such case, the new securities are to be delivered to the Custodian;

7)Upon the sale of such investments for the account of the Fund, to the broker or its clearing agent, against a receipt, for examination in accordance with usual "street delivery" custom; provided that in any such case the Custodian shall have no responsibility or liability for any loss arising from the delivery of such investments prior to receiving payment for such investments except as may arise from the Custodian`s own negligence or willful misconduct;

8)For exchange or conversion pursuant to any plan of merger, consolidation, recapitalization, reorganization or readjustment of the investments of the issuer of such investments, or pursuant to provisions for conversion contained in such investments, or pursuant to any deposit agreement; provided that, in any such case, the new investments and cash, if any, are to be delivered to the Custodian;

9)In the case of warrants, rights or similar investments, the surrender thereof in the exercise of such warrants, rights or similar investments or the surrender of interim receipts or temporary investments for definitive investments; provided that, in any such case, the new investments and cash, if any, are to be delivered to the Custodian or against a receipt;

10)For delivery in connection with any loans of investments made on behalf of the Fund, but only against receipt of adequate collateral as agreed upon from time to time by the Fund or its duly-appointed agent (which may be in the form of cash or obligations issued by the United States government, its agencies or instrumentalities, or such other property as the Fund may agree), except that in connection with any loans for which collateral is to be credited to the Custodian`s account in the book-entry system < font style="font-size:12.0pt;" face="Courier" color="Black">authorized by the U.S. Department of the Treasury, the Custodian will not be held liable or responsible for the delivery of investments owned by the Fund prior to the receipt of such collateral in the absence of the Custodian`s negligence or willful misconduct;

11)For delivery as security in connection with any borrowing by the Fund requiring a pledge of assets by the Fund, but only against receipt of amounts borrowed, except where additional collateral is required to secure a borrowing already made, subject to Proper Instructions, further securities may be released and delivered for that purpose;

12)For delivery in accordance with the provisions of any agreement among the Fund, the Custodian and a broker-dealer registered under the Securities Exchange Act of 1934 (the "Exchange Act") and a member of The National Association of Securities Dealers, Inc. ("NASD"),

relating to compliance with the rules of The Options Clearing Corporation, the rules of any registered national securities exchange or of any similar organization or organizations, or under the Investment Company Act of 1940, as amended from time to time (the "1940 Act"), regarding escrow or other arrangements in connection with transactions by the Fund;

13)For delivery in accordance with the provisions of any agreement among the Fund, the Custodian, and a Futures Commission Merchant registered under the Commodity Exchange Act, relating to compliance with the rules of the Commodity Futures Trading Commission and/or any Contract Market, or any similar organization or organizations, or under the 1940 Act, regarding account deposits in connection with transactions by the Fund;

14)Upon receipt of instructions from the transfer agent for the Fund (the "T ransfer Agent"), for delivery to such Transfer Agent or to the holders of shares in connection with distributions in kind, as may be described from time to time in the Fund`s currently effective prospectus, statement of additional information or other offering documents (all, as amended, supplemented or revised from time to time, the "Prospectus"), in satisfaction of requests by holders of Shares for repurchase or redemption; and

15)For any other purpose, but only upon receipt of Proper Instructions specifying (a) the investments to be delivered, (b) setting forth the purpose for which such delive ry is to be made, and (c) naming the person or persons to whom delivery of such investments shall be made.

Section 2.3Registration of Investments. Domestic investments held by the Custodian (other than b earer securities) shall be registered in the name of the Fund or in the name of any nominee of the Fund or of any nominee of the Custodian which nominee shall be assigned exclusively to the Fund, unless the Fund has authorized in writing the appointment of a nominee to be used in common with other registered investment companies having the same investment adviser as the Fund, or in the name or nominee name of any agent appointed pursuant to Section 2.8 or in the name or nominee name of any sub-custodian appointed pursuant to Section 1. All securities accepted by the Custodian on behalf of the Fund under the terms of

this Agreement shall be in good deliverable form. If, however, the Fund directs the Custodian to maintain securities in "street name", the Custodian shall utilize its best efforts only to timely collect income due the Fund on such securities and to notify the Fund of relevant corporate actions including, without limitation, pendency of calls, maturities, tender or exchange offers.

Section 2.4Bank Accounts. The Custodian shall open and maintain a separate bank account or accounts in the United States in the name of the Fund, subject only to draft or order by the Custodian acting pursuant to the terms of this Agreement, and shall hold in such account or accou nts, subject to the provisions hereof, all cash received by it from or for the account of the Fund, other than cash maintained by the Fund in a bank account established and used in accordance with Rule 17f-3 under the 1940 Act. Monies held by the Custodian for the Fund may be deposited by the Custodian to its credit as custodian in the banking department of the Custodian or in such other banks or trust companies as it may in its discretion deem necessary or desirable in the performance of its duties hereunder; provided, however, that every such bank or trust company shall be qualified to act as a custodian under the 1940 Act, and that each such bank or trust company and the funds to be deposited with each such bank or trust company shall be approved by vote of a majority of the board of directors or the board of trustees of the applicable Fund (as appropriate and in each case, the "Board"). Such funds shall be deposited by the Custodia n in its capacity as custodian and shall be withdrawable by the Custodian only in that capacity.

EX-99.13 OTH CONTRCT

TRANSFER AGENCY AND SERVICE AGREEMENT

between

T. ROWE PRICE SERVICES, INC.

and

THE T. ROWE PRICE FUNDS

TABLE OF CONTENTS

Page

Article A       Terms of Appointment    2

Article B       Duties of Price Services        3
        1.      Services        3
        2.      Agreements with Intermediaries  3
        3.      Anti-Money Laundering Program   4
Article C       Fees and Expenses       4
Article D       Representations and Warranties of the Price Services    4
Article E       Representations and Warranties of the Fund      5
Article F       Standard of Care/Indemnification        6
Article G       Dual Interests  8
Article H       Documentation   8
Article I       References to Price Services    10
Article J       Compliance with Governmental Rules and Regulations      10
Article K       Ownership of Software and Related Material      11
Article L       Quality Service Standards       11
Article M       As of Transactions      11
Article N       Term and Termination of Agreement       15
Article O       Notice  15
Article P       Assignment      16
Article Q       Amendment/Interpretive Provisions       16
Article R       Further Assurances      16
Article S       Maryland Law to Apply   16
Article T       Merger of Agreement     16
Article U       Counterparts    17
Article V       The Parties     17

Article W       Directors, Trustees, Shareholders and Massachusetts Business Trust      17
Article X       Captions        18

SCHEDULE 1
APPENDIX A

TRANSFER AGENCY AND SERVICE AGREEMENT

     AGREEMENT made as of the first day of January, 2006, by and between T. ROWE PRICE SERVICES, INC., a Maryland corporation having its principal office and place of business at 100 East Pratt Street, Baltimore, Maryland 21202 ("Price Services"), and EACH FUND WHICH IS LISTED ON APPENDIX A (as such Appendix may be amended from time to time) and which evidences its agreement to be bound hereby by executing a copy of this Agreement (each such Fund individually hereinafter referred to as "the Fund," whose definition may be found in Article V);

     WHEREAS, the Fund desires to appoint Price Services as its transfer agent, dividend disbursing agent and agent in connection with certain other activities, and Price Services desires to accept such appointment;

     WHEREAS, Price Services represents that it is registered with the Securities and Exchange Commission as a Transfer Agent under Section 17A of the Securities Exchange Act of 1934 ("'34 Act") and will notify each Fund promptly if such registration is revoked or if any proceeding is commenced before the Securities and Exchange Commission which may lead to such revocation;

     WHEREAS, Price Services has the capability of providing shareholder services on behalf of the Funds for the accounts of shareholders in the Funds;

     WHEREAS, certain of the Funds are underlying investment options of portfolios of College Savings Programs ("529 Plans") and Price Services has the capability of providing services, on behalf of the Funds, for the accounts of individuals participating in these 529 Plans;

     WHEREAS, certain of the Funds are named investment options under various taxsheltered retirement plans including, but not limited to, individual retirement accounts, SepIRA's, SIMPLE plans, deferred compensation plans, 403(b) plans, and profit sharing, thrift, and money purchase pension plans for self-employed individuals, individual 401(k)s and professional partnerships and corporations (collectively referred to as "Retirement Plans") and Price Services has the capability of providing services, on behalf of the Funds, for the accounts of shareholders ("Participants") participating in these Retirement Plans ("Retirement Accounts"); and

     WHEREAS, Price Services may subcontract or jointly contract with other parties, on behalf of the Funds, to perform certain of the functions and services described herein.

     NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows:

A. Terms of Appointment

     Subject to the terms and conditions set forth in this Agreement, the Fund hereby employs and appoints Price Services to act, and Price Services agrees to act, as the Fund's transfer agent, dividend disbursing agent and agent in connection with the Fund's authorized and issued shares of its common stock or shares of beneficial interest (all such stock and shares to be referred to as "Shares") and provide services to shareholders of the Fund ("Shareholders") and beneficial Shareholders as agreed to by the parties.

     The parties to the Agreement hereby acknowledge that from time to time, Price Services and T. Rowe Price Trust Company and their affiliates may enter into contracts ("Other Contracts") with employee benefit plans and/or their sponsors and the sponsors of 529 Plans for the provision of certain services to participants of 529 Plans and Retirement Plans. Compensation paid to Price Services pursuant to this Agreement is with respect to the services described herein and not with respect to services provided under Other Contracts.

B. Duties of Price Services

1. Services. Price Services agrees that it will perform services set forth on Schedule1 of this Agreement, on behalf of the Fund, in accordance with all applicable rules and regulations; the Fund's then-current prospectus, and policies and procedures adopted by Price Services.

2. Agreements with Intermediaries. The Fund authorizes Price Services to enter into agreements with certain third party intermediaries such as banks, broker-dealers, insurance companies and retirement plan recordkeepers ("Intermediaries") for the purpose of receiving orders for Fund shares by the Intermediary from beneficial Shareholders and Participants. Price Services shall receive orders in accordance with procedures established by agreement with such intermediaries and policies and procedures adopted by Price Services. Receipt of orders by such third party intermediaries may be deemed receipt by the Fund to the extent permitted by Rule 22c-1 of the Investment Company Act of 1940 ("'40 Act").

     Price Services may also enter into agreements on behalf of the Fund with Intermediaries who hold shares in omnibus accounts in Funds that assess redemption fees. Pursuant to these Agreements, the Intermediary agrees to assess the fee in accordance with the Fund's prospectus at the time of the redemption and remit such fees to the Fund on a monthly basis or such other mutually agreed upon time.

     In addition, the Funds have instituted a program whereby they may, in their discretion, pay an Intermediary or a Plan a fee to compensate the third party for certain expenses incurred as a result of providing administrative services to underlying shareholders of the Funds ("Administrative Fee Payments"). Each Fund authorizes Price Services to enter into, on its behalf, agreements with such Intermediaries or Plans for payment of such Administrative Fee Payments in consideration of such Plan or Intermediary's performance of services pursuant to the Fund's Administrative Fee Payment Program. Any payments owed under these Administrative Fee Agreements shall be the obligation of the applicable Fund, not Price Services.

3. Anti-Money Laundering Program. The Funds authorize Price Services to perform, on behalf of the Funds, Anti-Money Laundering ("AML") services in accordance with the Anti-Money Laundering Program adopted by the Funds, including the Fund's Customer Identification Program. Price Services shall, maintain policies and procedures, and related internal controls, which are consistent with such AML Program.

     Price Services is authorized to take, on behalf of the Funds, any action permitted by law and in accordance with the Fund's AML Program in carrying out its responsibilities under the Fund's AML Program, including rejecting purchases, freezing Shareholder accounts, restricting certain services, or closing Shareholder accounts if (a) suspicious activity is detected, (b) it is unable to verify the identity of a Shareholder, or (c) a Shareholder matches a government list of known or suspected suspicious persons.

C. Fees and Expenses.

     For the services performed on Schedule 1 of this Agreement, the Funds shall pay such fees and expenses as mutually agreed upon by the parties.

D. Representations and Warranties of Price Services

     Price Services represents and warrants to the Fund that:

1. It is a corporation duly organized and existing and in good standing under the laws of Maryland;

2. It is duly qualified to carry on its business in Maryland, Colorado, Florida, District of Columbia, Illinois, Massachusetts, New Jersey, Virginia and California;

3. It is empowered under applicable laws and by its charter and by-laws to enter into and perform this Agreement;

4. All requisite corporate proceedings have been taken to authorize it to enter into and perform this Agreement;

5. It is registered with the Securities and Exchange Commission as a Transfer Agent pursuant to Section 17A of the '34 Act; and

6. It has and will continue to have access to the necessary facilities, equipment and personnel to perform its duties and obligations under this Agreement.

E. Representations and Warranties of the Fund

     The Fund represents and warrants to Price Services that:

1. It is a corporation or business trust duly organized and existing and in good standing under the laws of Maryland or Massachusetts, as the case may be;

2. It is empowered under applicable laws and by its Articles of Incorporation or Declaration of Trust, as the case may be, and By-Laws to enter into and perform this Agreement;

3. All proceedings required by said Articles of Incorporation or Declaration of Trust, as the case may be, and By-Laws have been taken to authorize it to enter into and perform this Agreement;

4. It is an investment company registered under the '40 Act; and

5. A registration statement under the Securities Act of 1933 ("the 33 Act") is currently effective and will remain effective, and appropriate state securities law filings have been made and will continue to be made, with respect to all Shares of the Fund being offered for sale.

F. Standard of Care/Indemnification

     Notwithstanding anything to the contrary in this Agreement:

1. Price Services shall not be liable to any Fund for any act or failure to act by it or its agents or subcontractors on behalf of the Fund in carrying or attempting to carry out the terms and provisions of this Agreement provided Price Services has acted in good faith and without negligence or willful misconduct and selected and monitored the performance of its agents and subcontractors with reasonable care.

2. The Fund shall indemnify and hold Price Services harmless from and against all losses, costs, damages, claims, actions and expenses, including reasonable expenses for legal counsel, incurred by Price Services resulting from: (i) any action or omission by Price Services or its agents or subcontractors in the performance of their duties hereunder; (ii) Price Services acting upon instructions believed by it to have been executed by a duly authorized officer of the Fund; or (iii) Price Services acting upon information provided by the Fund in form and under policies agreed to by Price Services and the Fund. Price Services shall not be entitled to such indemnification in respect of actions or omissions constituting negligence or willful misconduct of Price Services or where Price Services has not exercised reasonable care in selecting or monitoring the performance of its agents or subcontractors.

3. Except as provided in Article M of this Agreement, Price Services shall indemnify and hold harmless the Fund from all losses, costs, damages, claims, actions and expenses, including reasonable expenses for legal counsel, incurred by the Fund resulting from the negligence or willful misconduct of Price Services' or which result from Price Services failure to exercise reasonable care in selecting or monitoring the performance of its agents or subcontractors. The Fund shall not be entitled to such indemnification in respect of actions or omissions constituting negligence or willful misconduct of such Fund or its agents or subcontractors; unless such negligence or misconduct is attributable to Price Services.

4. In determining Price Services' liability, an isolated error or omission will normally not be deemed to constitute negligence when it is determined that:

1. Price Services had in place "appropriate procedures;" and

1. the employee(s) responsible for the error or omission had been reasonably trained and were being appropriately monitored.

1. No evidence or circumstances have been produced to indicate that the individual who committed the error or omission was functioning in bad faith, gross negligence or willful misconduct at the time of the incident.

It is understood that Price Services is not obligated to have in place separate procedures to prevent each and every conceivable type of error or omission. The term "Appropriate Procedures" shall mean procedures reasonably designed to prevent and detect errors and omissions. In determining the reasonableness of such procedures, weight will be given to such factors as are appropriate, including the prior occurrence of any similar errors or omissions when such procedures were in place and transfer agent industry standards in place at the time of the occurrence.

5. In the event either party is unable to perform its obligations under the terms of this Agreement because of acts of God, strikes or other causes reasonably beyond its control, such party shall not be liable to the other party for any loss, cost, damage, claim, action or expense resulting from such failure to perform or otherwise from such causes.

6. In order that the indemnification provisions contained in this Article F shall apply, upon the assertion of a claim for which either party may be required to indemnify the other, the party seeking indemnification shall promptly notify the other party of such assertion, and shall keep the other party advised with respect to all developments concerning such claim. The party who may be required to indemnify shall have the option to participate with the party seeking indemnification in the defense of such claim, or to defend against said claim in its own name or in the name of the other party. The party seeking indemnification shall in no case confess any claim or make any compromise in any case in which the other party may be required to indemnify it except with the other party's prior written consent.

7. Neither party to this Agreement shall be liable to the other party for consequential damages under any provision of this Agreement.

G. Dual Interests

     It is understood that some person or persons may be directors, officers, or shareholders of both the Funds and Price Services (including Price Services' affiliates), and that the existence of any such dual interest shall not affect the validity of this Agreement or of any transactions hereunder except as otherwise provided by a specific provision of applicable law.

H. Documentation

     As requested by Price Services, the Fund shall promptly furnish to Price Services the following:

1. A certified copy of the resolution of the Directors/Trustees of the Fund authorizing the appointment of Price Services and the execution and delivery of this Agreement;

1. A copy of the Articles of Incorporation or Declaration of Trust, as the case may be, and By-Laws of the Fund and all amendments thereto;

1. As applicable, specimens of all forms of outstanding and new stock/share certificates in the forms approved by the Board of Directors/Trustees of the Fund with a certificate of the Secretary of the Fund as to such approval;

1. All account application forms and other documents relating to Shareholders' accounts;

1. An opinion of counsel for the Fund with respect to the validity of the stock, the number of Shares authorized, the status of redeemed Shares, and the number of Shares with respect to which a Registration Statement has been filed and is in effect; and

1. A copy of the Funds current prospectus.

     The delivery of any such document for the purpose of any other agreement to which the Fund and Price Services are or were parties shall be deemed to be delivery for the purposes of this Agreement.

     As requested by Price Services, the Fund will also furnish from time to time the following documents:

1. Each resolution of the Board of Directors/Trustees of the Fund authorizing the original issue of its Shares;

1. Each Registration Statement filed with the Securities and Exchange Commission and amendments and orders thereto in effect with respect to the sale of Shares with respect to the Fund;

1. A certified copy of each amendment to the Articles of Incorporation or Declaration of Trust, and the ByLaws of the Fund;

1. Certified copies of each vote of the Board of Directors/Trustees authorizing officers to give instructions to the Transfer Agent;

1. Such other documents or opinions which Price Services, in its discretion, may reasonably deem necessary or appropriate in the proper performance of its duties; and

1. Copies of new prospectuses issued.

     Price Services hereby agrees to establish and maintain facilities and procedures reasonably acceptable to the Fund for safekeeping of stock certificates, check forms and facsimile signature imprinting devices, if any; and for the preparation or use, and for keeping account of, such certificates, forms and devices.

I. References to Price Services

     Each Fund agrees not to circulate any printed matter which contains any reference to Price Services without the prior approval of Price Services, excepting solely such printed matter that merely identifies Price Services as agent of the Fund. The Fund will submit printed matter requiring approval to Price Services in draft form, allowing sufficient time for review by Price Services and its legal counsel prior to any deadline for printing.

J. Compliance with Governmental Rules and Regulations

     Except as otherwise provided in the Agreement and except for the accuracy of information furnished to the Fund by Price Services, each Fund assumes full responsibility for the preparation, contents and distribution of its prospectuses and compliance with all applicable requirements of the '40 Act, the '34 Act, the '33 Act, and any other laws, rules and regulations of governmental authorities having jurisdiction over the Fund. Price Services shall be responsible for complying with all laws, rules and regulations of governmental authorities having jurisdiction over transfer agents and their activities and cooperating with respect to examinations and requests from such governmental authorities.

K. Ownership of Software and Related Material

     All computer programs, magnetic tapes, written procedures and similar items purchased and/or developed and used by Price Services in performance of the Agreement shall be the property of Price Services and will not become the property of the Fund.

L. Quality Service Standards

     Price Services and the Fund may from time to time agree to certain quality service standards, as well as incentives and penalties with respect to Price Services' hereunder.

M. As Of Transactions

     For purposes of this Article M, the term "Transaction" shall mean any single or "related transaction" (as defined below) involving the purchase or redemption of Shares (including exchanges) that is processed at a time other than the time of the computation of the Fund's net asset value per Share next computed after receipt of any such transaction order by Price Services due to an act or omission of Price Services. "As Of Processing" refers to the processing of these Transactions. All As Of Processing may only be performed in accordance with the requirements of Rule 22c-1 of the '40 Act. Price Services is responsible for monitoring As Of Transactions procedures that set forth the circumstances under which As Of Transactions are permitted. If more than one Transaction ("Related Transaction") in the Fund is caused by or occurs as a result of the same act or omission, such transactions shall be aggregated with other transactions in the Fund and be considered as one Transaction.

Reporting

     Price Services shall:

1. Utilize a system to identify all Transactions, and shall compute the net effect of such Transactions upon the Fund on a daily, monthly and rolling 365-day basis. The monthly and rolling 365-day periods are hereafter referred to as "Cumulative."

2. Supply to the Fund, from time to time as mutually agreed upon, a report summarizing the Transactions and the daily and Cumulative net effects of such Transactions both in terms of aggregate dilution and loss ("Dilution") or gain and negative dilution ("Gain") experienced by the Fund, and the impact such Gain or Dilution has had upon the Fund's net asset value per Share.

3. With respect to any Transaction which causes Dilution to the Fund of $100,000 or more, immediately provide the Fund: (i) a report identifying the Transaction and the Dilution resulting therefrom, (ii) the reason such Transaction was processed as described above, and (iii) the action that Price Services has or intends to take to prevent the reoccurrence of such as of processing ("Report").

Liability

1. It will be the normal practice of the Funds not to hold Price Services liable with respect to any Transaction that causes Dilution to any single Fund of less than $25,000. Price Services will, however, closely monitor for each Fund the daily and Cumulative Gain/Dilution that is caused by Transactions of less than $25,000. When the Cumulative Dilution to any Fund exceeds 3/10 of 1% net asset value per share, Price Services, in consultation with counsel to the Fund, will make appropriate inquiry to determine whether it should take any remedial action. Price Services will report to the Board of Directors/Trustees of the Fund ("Board") any action it has taken.

2. Where a Transaction causes Dilution to a Fund equal to or greater than $25,000 ("Significant Transaction"), but less than $100,000, Price Services will review with Counsel to the Fund the circumstances surrounding the underlying Transaction to determine whether the Transaction was caused by or occurred as a result of a negligent act or omission by Price Services. If it is determined that the Dilution is the result of a negligent action or omission by Price Services, Price Services and outside counsel for the Fund will negotiate settlement. Significant Transactions equal to or greater than $25,000 will be reported to the Audit Committee at least annually (unless the settlement fully compensates the Fund for any Dilution). Any Significant Transaction, however, causing Dilution in excess of the lesser of $100,000 or a penny per share will be promptly reported to the Board and resolved at the next scheduled Board Meeting. Settlement for Significant Transactions causing Dilution of $100 more will not be entered into until approved by the Board. The factors to consider in making any determination regarding the settlement of a Significant Transaction would include but not be limited to:

1. Procedures and controls adopted by Price Services to prevent As Of Processing;

1. Whether such procedures and controls were being followed at the time of the Significant Transaction;

1. The absolute and relative volume of all transactions processed by Price Services on the day of the Significant Transaction;

1. The number of Transactions processed by Price Services during prior relevant periods, and the net Dilution/Gain as a result of all such Transactions to the Fund and to all other Price Funds;

1. The prior response of Price Services to recommendations made by the Funds regarding improvement to Price Services' As Of Processing procedures.

3. In determining Price Services' liability with respect to a Significant Transaction, an isolated error or omission will normally not be deemed to constitute negligence when it is determined that:

1. Price Services had in place "Appropriate Procedures" as defined in Section 4 of Article F of this Agreement (it is understood that Price Services is not obligated to have in place separate procedures to prevent each and every conceivable type of error or omission);

1. the employee(s) responsible for the error or omission had been reasonably trained and were being appropriately monitored; and

1. No evidence or circumstances have been produced to indicate that the individual who committed the error or omission was functioning in bad faith, gross negligence or willful misconduct at the time of the incident.

1. As Of Transactions - Intermediaries

     If an As Of Transaction is performed by an intermediary, which is designated by the Fund to received orders for Fund Shares, Price Services shall cause such intermediary to promptly reimburse the Fund for any Dilution caused by such As Of Transaction; provided, however, Price Services shall not be obligated to seek reimbursement from such intermediary if the Dilution is less than $100.

N. Term and Termination of Agreement

1. This Agreement shall run for a period of one (1) year from the date first written above and will be renewed from year to year thereafter unless terminated by either party as provided hereunder.

1. This Agreement may be terminated by the Fund upon one hundred twenty (120) days' written notice to Price Services; and by Price Services, upon three hundred sixty-five (365) days' written notice to the Fund.

1. Upon termination hereof, the Fund shall pay to Price Services such compensation as may be due as of the date of such termination, and shall likewise reimburse for outofpocket expenses related to its services hereunder.

O. Notice

     Any notice as required by this Agreement shall be sufficiently given (i) when sent to an authorized person of the other party at the address of such party set forth above or at such other address as such party may from time to time specify in writing to the other party; or (ii) as otherwise agreed upon by appropriate officers of the parties hereto.

P. Assignment

     Neither this Agreement nor any rights or obligations hereunder may be assigned either voluntarily or involuntarily, by operation of law or otherwise, by either party without the prior written consent of the other party, provided this shall not preclude Price Services from employing such agents and subcontractors as it deems appropriate to carry out its obligations set forth hereunder.

Q. Amendment/Interpretive Provisions

     The parties by mutual written agreement may amend this Agreement at any time. In addition, in connection with the operation of this Agreement, Price Services and the Fund may agree from time to time on such provisions interpretive of or in addition to the provisions of this Agreement as may in their joint opinion be consistent with the general tenor of this Agreement. Any such interpretive or additional provisions are to be signed by all parties and annexed hereto, but no such provision shall contravene any applicable Federal or state law or regulation and no such interpretive or additional provision shall be deemed to be an amendment of this Agreement.

R. Further Assurances

     Each party agrees to perform such further acts and execute such further documents as are necessary to effectuate the purposes hereof.

S. Maryland Law to Apply

     This Agreement shall be construed and the provisions thereof interpreted under and in accordance with the laws of Maryland.

T. Merger of Agreement

     This Agreement, including the attached Appendices and Schedules supersedes any prior agreement with respect to the subject hereof, whether oral or written.

U. Counterparts

     This Agreement may be executed by the parties hereto on any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instruments.

V. The Parties

     All references herein to "the Fund" are to each of the Funds listed on Appendix A individually, as if this Agreement were between such individual Fund and Price Services. In the case of a series Fund or trust, all references to "the Fund" are to the individual series or portfolio of such Fund or trust, or to such Fund or trust on behalf of the individual series or portfolio, as appropriate. The "Fund" also includes any T. Rowe Price Funds that may be established after the execution of this Agreement. Any reference in this Agreement to "the parties" shall mean Price Services and such other individual Fund as to which the matter pertains.

W. Directors, Trustees and Shareholders and Massachusetts Business Trust

     It is understood and is expressly stipulated that neither the holders of Shares in the Fund nor any Directors or Trustees of the Fund shall be personally liable hereunder.

     With respect to any Fund which is a party to this Agreement and which is organized as a Massachusetts business trust, the term "Fund" means and refers to the trustees from time to time serving under the applicable trust agreement (Declaration of Trust) of such Trust as the same may be amended from time to time. It is expressly agreed that the obligations of any such Trust hereunder shall not be binding upon any of the trustees, shareholders, nominees, officers, agents or employees of the Trust, personally, but bind only the trust property of the Trust, as provided in the Declaration of Trust of the Trust. The execution and delivery of this Agreement has been authorized by the trustees and signed by an authorized officer of the Trust, acting as such, and neither such authorization by such Trustees nor such execution and delivery by such officer shall be deemed to have been made by any of them, but shall bind only the trust property of the Trust as provided in its Declaration of Trust.

X. Captions

     The captions in the Agreement are included for convenience of reference only and in no way define or limit any of the provisions hereof or otherwise affect their construction or effect.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their names and on their behalf under their seals by and through their duly authorized officers.

EX-99.13 OTH CONTRCT

AGREEMENT

between

T. ROWE PRICE ASSOCIATES, INC.

and

THE T. ROWE PRICE FUNDS

for

FUND ACCOUNTING SERVICES

TABLE OF CONTENTS 



Page 

Article A       Terms of Appointment/Duties of Price Associates 1

Article B       Fees and Expenses       3

Article C       Representations and Warranties of Price Associates      3

Article D       Representations and Warranties of the Fund      4

Article E       Ownership of Software and Related Material      4

Article F       Quality Service Standards       4

Article G       Standard of Care/Indemnification        4

Article H       Dual Interests  7

Article I       Documentation   7

Article J       Recordkeeping/Confidentiality   7

Article K       Compliance with Governmental Rules and Regulations      8

Article L       Term and Termination of Agreement       8

Article M       Notice  8

Article N       Assignment      8

Article O       Amendment/Interpretive Provisions       9

Article P       Further Assurances      9

Article Q       Maryland Law to Apply   9

Article R       Merger of Agreement     9

Article S       Counterparts    9

Article T       The Parties     10

Article U       Directors, Trustee and Shareholders and Massachusetts Business Trust    10

Article V       Captions        11
        i

     AGREEMENT made as of thefirstday of January, 2006, by and between T. ROWE PRICE ASSOCIATES, INC., a Maryland corporation having its principal office and place of business at 100East Pratt Street, Baltimore, Maryland 21202 ("Price Associates"), and each Fund which is listed on Appendix A (as such Appendix may be amended from time to time) and which evidences its agreement to be bound hereby by executing a copy of this Agreement (each such Fund individually hereinafter referred to as "the Fund", whose definition may be found in Article T);

     WHEREAS, Price Associates has the capability of providing the Funds with certain accounting services ("Accounting Services");

     WHEREAS, the Fund desires to appoint Price Associates to provide these Accounting Services and Price Associates desires to accept such appointment;

     WHEREAS, Price Associates may subcontract or jointly contract with other parties, on behalf of the Funds to perform certain of the functions and services described herein;

     WHEREAS, the Board of Directors/Trustees of the Fund (the "Board") has authorized the Fund to utilize various pricing services for the purpose of providing to Price Associates securities prices for the calculation of the Fund's net asset value.

     NOW, THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows:

A. Terms of Appointment/Duties of Price Associates

     Subject to the terms and conditions set forth in this Agreement, the Fund hereby employs and appoints Price Associates to provide, and Price Associates agrees to provide, the following Accounting Services:

1. Maintain for each Fund a daily trial balance, a general ledger, subsidiary records and capital stock accounts;

2. Maintain for each Fund an investment ledger, including amortized bond, foreign dollar denominated costs and securities on loan where applicable;

3. Maintain for each Fund all records relating to the Fund's income and expenses;

4. Provide for the daily valuation of each Fund's portfolio securities and the computation of each Fund's daily net asset value per share ("NAV"). Such daily valuations shall be made in accordance with the valuation policies established by each of the Fund's Board including, but not limited to, the utilization of such pricing valuation sources and/or pricing services as determined by the Boards.

     Price Associates shall have no liability for any losses or damages incurred by the Fund as a result of erroneous portfolio security evaluations provided by such designated sources and/or pricing services; provided that, Price Associates reasonably believes the prices are accurate, has adhered to its normal verification control procedures, and has otherwise met the standard of care as set forth in Article G of this Agreement;

5. Provide daily cash flow and transaction status information to each Fund's adviser;

6. Authorize the payment of Fund expenses, either through instruction of custodial bank or utilization of custodian's automated transfer system;

7. Prepare for each Fund such financial information that is reasonably necessary for shareholder reports, reports to the Board and to the officers of the Fund, reports to the Securities and Exchange Commission ("SEC"), the Internal Revenue Service ("IRS") and other Federal and state regulatory agencies;

8. Provide each Fund with such advice that may be reasonably necessary to properly account for all financial transactions and to maintain the Fund's accounting procedures and records so as to insure compliance with generally accepted accounting and tax practices and rules;

9. Maintain for each Fund all records that may be reasonably required in connection with the audit performed by each Fund's independent accountant, the SEC, the IRS or such other Federal or state regulatory agencies; and

10. Cooperate with each Fund's independent public accountants and take all reasonable action in the performance of its obligations under the Agreement to assure that the necessary information is made available to such accountants for the expression of their opinion without any qualification as to the scope of their examination including, but not limited to, their opinion included in each such Fund's annual report on Form N-CSR and annual amendment to Form N-1A.

11. Maintain adequate internal controls over financial reporting to provide complete and accurate financial information and disclosures that are certified by officers of the Funds. Provide sub-certifications, as requested by the officers of the Funds, for the adequacy of such controls and the completeness and accuracy of information included in Form N-CSR, Form N-Q, or any other form that may require certification.

B. Fees and Expenses

     For the accounting services performed hereunder, the Fund shall pay the fees and expenses as mutually agreed upon by both parties.

C. Representations and Warrantees of Price Associates

     Price Associates represents and warrants to the Fund that:

1. It is a corporation duly organized and existing in good standing under the laws of Maryland.

2. It is duly qualified to carry on its business in Maryland.

3. It is empowered under applicable laws and by its charter and By-Laws to enter into and perform this Agreement.

4. All requisite corporate proceedings have been taken to authorize it to enter into and perform this Agreement.

5. It has, and will continue to have, access to the necessary facilities, equipment and personnel to perform its duties and obligations under this Agreement.

D. Representations and Warranties of the Fund

     The Fund represents and warrants to Price Associates that:

1. It is a corporation or business trust, as the case may be, duly organized and existing and in good standing under the laws of Maryland or Massachusetts, as the case may be.

2. It is empowered under applicable laws and by its Articles of Incorporation or Declaration of Trust, as the case may be, and By-Laws and all required proceedings have been taken to authorize it to enter into and perform this Agreement.

E. Ownership of Software and Related Material

     All computer programs, magnetic tapes, written procedures, and similar items purchased and/or developed and used by Price Associates in performance of this Agreement shall be the property of Price Associates and will not become the property of the Funds.

F. Quality Service Standards

     Price Associates and the Fund may, from time to time, agree to certain quality service standards, with respect to Price Associates' services hereunder.

G. Standard of Care/Indemnification

     Notwithstanding anything to the contrary in this Agreement:

1. Where an NAV error results in loss or dilution to a Fund of less than $10,000, the determination of liability for the error will be made by Price Associates. Where an NAV error results in loss or dilution to a Fund of $10,000 or more but less than $100,000, liability for the error will be resolved through negotiations between Fund Counsel and Price Associates. Where an NAV error results in loss or dilution to a Fund of the lesser of 1/2 of 1% of NAV or $100,000 or more, the error will be promptly reported to the Board (unless the Fund is fully compensated for the loss or dilution), provided that final settlement with respect to such errors will not be made until approved by the Board. A summary of all NAV errors and their effect on the Funds will be reported to the Funds' Audit Committee on an annual basis. In determining the liability of Price Associates for an NAV error, an error or omission will not be deemed to constitute negligence when it is determined that:

1. Price Associates had in place appropriate procedures and an adequate system of internal controls;

1. the employee(s) responsible for the error or omission had been reasonably trained and was being appropriately monitored; and

1. no evidence or circumstances have been produced to indicate that the individual who committed the error or omission was functioning in bad faith, with gross negligence or willful misconduct at the time of the incident.

     It is understood that Price Associates is not obligated to have in place separate procedures to prevent each and every conceivable type of error or omission. The term "appropriate procedures and adequate system of internal controls" shall mean procedures and controls reasonably designed to prevent and detect errors and omissions. In determining the reasonableness of such procedures and controls, weight will be given to such factors as are appropriate, including the prior occurrence of any similar errors or omissions when such procedures and controls were in place and fund accounting industry standards in place at the time of the error.

2. The Fund shall indemnify and hold Price Associates harmless from and against all losses, costs, damages, claims, actions, and expenses, including reasonable expenses for legal counsel, incurred by Price Associates resulting from: (i) any action or omission by Price Associates or its agents or subcontractors in the performance of their duties hereunder; (ii) Price Associates acting upon instructions believed by it to have been executed by a duly authorized officer of the Fund; or (iii) Price Associates acting upon information provided by the Fund in form and under policies agreed to by Price Associates and the Fund. Price Associates shall not be entitled to such indemnification in respect of actions or omissions constituting negligence or willful misconduct of Price Associates or where Price Associates has not exercised reasonable care in selecting or monitoring the performance of its agents or subcontractors.

3. Price Associates shall indemnify and hold harmless the Fund from all losses, costs, damages, claims, actions and expenses, including reasonable expenses for legal counsel, incurred by the Fund resulting from the negligence or willful misconduct of Price Associates or which result from Price Associates' failure to exercise reasonable care in selecting or monitoring the performance of its agents or subcontractors. The Fund shall not be entitled to such indemnification with respect to actions or omissions constituting negligence or willful misconduct of such Fund or its agents or subcontractors; unless such negligence or misconduct is attributable to Price Associates.

4. In the event either party is unable to perform its obligations under the terms of this Agreement because of acts of God, strikes or other causes reasonably beyond its control, such party shall not be liable to the other party for any loss, cost, damage, claim, action or expense resulting from such failure to perform or otherwise from such causes.

5. In order that the indemnification provisions contained in this Article G shall apply, upon the assertion of a claim for which either party may be required to indemnify the other, the party seeking indemnification shall promptly notify the other party of such assertion, and shall keep the other party advised with respect to all developments concerning such claim. The party who may be required to indemnify shall have the option to participate with the party seeking indemnification in the defense of such claim, or to defend against said claim in its own name or in the name of the other party. The party seeking indemnification shall in no case confess any claim or make any compromise in any case in which the other party may be required to indemnify it except with the other party's prior written consent.

6. Neither party to this Agreement shall be liable to the other party for consequential damages under any provision of this Agreement.

H. Dual Interests

     It is understood that some person or persons may be directors, officers, or shareholders of both the Fund and Price Associates (including Price Associates' affiliates), and that the existence of any such dual interest shall not affect the validity of this Agreement or of any transactions hereunder except as otherwise provided by a specific provision of applicable law.

I. Documentation

     As requested by Price Associates, the Fund shall promptly furnish to Price Associates such documents as it may reasonably request and as are necessary for Price Associates to carry out its responsibilities hereunder.

J. Recordkeeping/Confidentiality

1. Price Associates shall keep records relating to the services to be performed hereunder, in the form and manner as it may deem advisable, provided that Price Associates shall keep all records in such form and in such manner as required by applicable law, including the Investment Company Act of 1940 ("the '40 Act") and the Securities Exchange Act of 1934 ("the '34 Act").

2. Price Associates and the Fund agree that all books, records, information and data pertaining to the business of the other party which are exchanged or received pursuant to the negotiation or the carrying out of this Agreement shall remain confidential, and shall not be voluntarily disclosed to any other person, except: (a)after prior notification to and approval in writing by the other party hereto, which approval shall not be unreasonably withheld and may not be withheld where Price Associates or Fund may be exposed to civil or criminal contempt proceedings for failure to comply; (b) when requested to divulge such information by duly constituted governmental authorities; or (c) after so requested by the other party hereto.

K. Compliance with Governmental Rules and Regulations

     Except as otherwise provided in the Agreement and except for the accuracy of information furnished to the Funds by Price Associates, each Fund assumes full responsibility for the preparation, contents and distribution of its prospectuses, and for complying with all applicable requirements of the Act, the '34 Act, the Securities Act of 1933 ("the '33 Act"), and any laws, rules and regulations of governmental authorities having jurisdiction over the Funds.

L. Term and Termination of Agreement

1. This Agreement shall run for a period of one (1) year from the date first written above and will be renewed from year to year thereafter unless terminated by either party as provided hereunder.

2. This Agreement may be terminated by the Fund upon sixty (60) days' written notice to Price Associates; and by Price Associates, upon three hundred sixty-five (365) days' written notice to the Fund.

3. Upon termination hereof, the Fund shall pay to Price Associates such compensation as may be due as of the date of such termination, and shall likewise reimburse for out-of-pocket expenses related to its services hereunder.

M. Notice

     Any notice as required by this Agreement shall be sufficiently given (i) when sent to an authorized person of the other party at the address of such party set forth above or at such other address as such party may from time to time specify in writing to the other party; or (ii) as otherwise agreed upon by appropriate officers of the parties hereto.

N. Assignment

     Neither this Agreement nor any rights or obligations hereunder may be assigned either voluntarily or involuntarily, by operation of law or otherwise, by either party without the prior written consent of the other party, provided this shall not preclude Price Associates from employing such agents and subcontractors as it deems appropriate to carry out its obligations set forth hereunder.

O. Amendment/Interpretive Provisions

     The parties by mutual written agreement may amend this Agreement at any time. In addition, in connection with the operation of this Agreement, Price Associates and the Fund may agree from time to time on such provisions interpretive of or in addition to the provisions of this Agreement as may in their joint opinion be consistent with the general tenor of this Agreement. Any such interpretive or additional provisions are to be signed by all parties and annexed hereto, but no such provision shall contravene any applicable Federal or state law or regulation and no such interpretive or additional provision shall be deemed to be an amendment of this Agreement.

P. Further Assurances

     Each party agrees to perform such further acts and execute such further documents as are necessary to effectuate the purposes hereof.

Q. Maryland Law to Apply

     This Agreement shall be construed and the provisions thereof interpreted under and in accordance with the laws of Maryland.

R. Merger of Agreement

     This Agreement, including the attached Appendix and Schedule supersedes any prior agreement with respect to the subject hereof, whether oral or written.

S. Counterparts

     This Agreement may be executed by the parties hereto on any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instruments.

T. The Parties

     All references herein to "the Fund" are to each of the Funds listed on Appendix A individually or any class thereof, as if this Agreement were between such individual Fund and Price Associates. In the case of a series Fund or trust, all references to "the Fund" are to the individual series or portfolio of such Fund or trust, or to such Fund or trust on behalf of the individual series or portfolio, as appropriate. The "Fund" also includes any T. Rowe Price Funds that may be established after the execution of this Agreement. Any reference in this Agreement to "the parties" shall mean Price Associates and such other individual Fund as to which the matter pertains.

U. Directors, Trustees and Shareholders and Massachusetts Business Trust

     It is understood and is expressly stipulated that neither the holders of shares in the Fund nor any Directors or Trustees of the Fund shall be personally liable hereunder.

     With respect to any Fund which is a party to this Agreement and which is organized as a Massachusetts business trust, the term "Fund" means and refers to the trustees from time to time serving under the applicable trust agreement (Declaration of Trust) of such Trust as the same may be amended from time to time. It is expressly agreed that the obligations of any such Trust hereunder shall not be binding upon any of the trustees, shareholders, nominees, officers, agents or employees of the Trust, personally, but bind only the trust property of the Trust, as provided in the Declaration of Trust of the Trust. The execution and delivery of this Agreement has been authorized by the trustees and signed by an authorized officer of the Trust, acting as such, and neither such authorization by such Trustees nor such execution and delivery by such officer shall be deemed to have been made by any of them, but shall bind only the trust property of the Trust as provided in its Declaration of Trust.

V. Captions

     The captions in the Agreement are included for convenience of reference only and in no way define or limit any of the provisions hereof or otherwise affect their construction or effect.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their names and on their behalf under their seals by and through their duly authorized officers.

T. ROWE PRICE ASSOCIATES, INC.          T. ROWE PRICE FUNDS 

BY:/s/Henry H. Hopkins                  BY:/s/Joseph A. Carrier

DATED: March 16, 2006                   DATED: March 16, 2006

APPENDIX A

T. ROWE PRICE BALANCED FUND, INC.

T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. Rowe Price Blue Chip Growth Fund--Advisor Class
T. Rowe Price Blue Chip Growth Fund--R Class

T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund

T. ROWE PRICE CAPITAL APPRECIATION FUND
T. Rowe Price Capital Appreciation Fund--Advisor Class

T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.
T. Rowe Price Capital Opportunity Fund--Advisor Class
T. Rowe Price Capital Opportunity Fund--R Class

T. ROWE PRICE CORPORATE INCOME FUND, INC.

T. ROWE PRICE DEVELOPING TECHNOLOGIES FUND, INC.

T. ROWE PRICE DIVERSIFIED MID-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVERSIFIED SMALL-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. Rowe Price Dividend Growth Fund--Advisor Class

T. ROWE PRICE EQUITY INCOME FUND
T. Rowe Price Equity Income Fund--Advisor Class
T. Rowe Price Equity Income Fund--R Class

T. ROWE PRICE EQUITY SERIES, INC.
T. Rowe Price Blue Chip Growth Portfolio
T. Rowe Price Blue Chip Growth Portfolio-II
T. Rowe Price Equity Income Portfolio
T. Rowe Price Equity Income Portfolio-II
T. Rowe Price Equity Index 500 Portfolio
T. Rowe Price Health Sciences Portfolio
T. Rowe Price Health Sciences Portfolio-II
T. Rowe Price Mid-Cap Growth Portfolio
T. Rowe Price Mid-Cap Growth Portfolio-II
T. Rowe Price New America Growth Portfolio
T. Rowe Price Personal Strategy Balanced Portfolio

T. ROWE PRICE FINANCIAL SERVICES FUND, INC.

T. ROWE PRICE FIXED INCOME SERIES, INC.
T. Rowe Price Limited-Term Bond Portfolio
T. Rowe Price Limited-Term Bond Portfolio-II
T. Rowe Price Prime Reserve Portfolio

T. ROWE PRICE GLOBAL TECHNOLOGY FUND, INC.

T. ROWE PRICE GNMA FUND

T. ROWE PRICE GROWTH & INCOME FUND, INC.

T. ROWE PRICE GROWTH STOCK FUND, INC.
T. Rowe Price Growth Stock Fund--Advisor Class
T. Rowe Price Growth Stock Fund--R Class

T. ROWE PRICE HEALTH SCIENCES FUND, INC.

T. ROWE PRICE HIGH YIELD FUND, INC.
T. Rowe Price High Yield Fund--Advisor Class

T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index 500 Fund
T. Rowe Price Extended Equity Market Index Fund
T. Rowe Price Total Equity Market Index Fund

T. ROWE PRICE INFLATION PROTECTED BOND FUND, INC.

T. ROWE PRICE INSTITUTIONAL EQUITY FUNDS, INC.
T. Rowe Price Institutional Large-Cap Core Growth Fund
T. Rowe Price Institutional Large-Cap Growth Fund
T. Rowe Price Institutional Large-Cap Value Fund
T. Rowe Price Institutional Mid-Cap Equity Growth Fund
T. Rowe Price Institutional Small-Cap Stock Fund

T. ROWE PRICE INSTITUTIONAL INCOME FUNDS, INC.
T. Rowe Price Institutional Core Plus Fund
T. Rowe Price Institutional High Yield Fund

T. ROWE PRICE INSTITUTIONAL INTERNATIONAL FUNDS, INC.
T. Rowe Price Institutional Emerging Markets Equity Fund
T. Rowe Price Institutional Foreign Equity Fund

T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price Emerging Europe & Mediterranean Fund
T. Rowe Price Emerging Markets Bond Fund
T. Rowe Price Emerging Markets Stock Fund
T. Rowe Price European Stock Fund
T. Rowe Price Global Stock Fund
T. Rowe Price International Bond Fund
T. Rowe Price International Bond Fund--Advisor Class
T. Rowe Price International Discovery Fund
T. Rowe Price International Growth & Income Fund
T. Rowe Price International Growth & Income Fund--Advisor Class
T. Rowe Price International Growth & Income Fund--R Class
T. Rowe Price International Stock Fund
T. Rowe Price International Stock Fund--Advisor Class
T. Rowe Price International Stock Fund--R Class
T. Rowe Price Japan Fund
T. Rowe Price Latin America Fund
T. Rowe Price New Asia Fund

T. ROWE PRICE INTERNATIONAL INDEX FUND, INC.
T. Rowe Price International Equity Index Fund

T. ROWE PRICE INTERNATIONAL SERIES, INC.
T. Rowe Price International Stock Portfolio

T. ROWE PRICE MEDIA & TELECOMMUNICATIONS FUND, INC.

T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. Rowe Price Mid-Cap Growth Fund--Advisor Class
T. Rowe Price Mid-Cap Growth Fund--R Class

T. ROWE PRICE MID-CAP VALUE FUND, INC.
T. Rowe Price Mid-Cap Value Fund--Advisor Class
T. Rowe Price Mid-Cap Value Fund--R Class

T. ROWE PRICE NEW AMERICA GROWTH FUND
T. Rowe Price New America Growth Fund--Advisor Class

T. ROWE PRICE NEW ERA FUND, INC.

T. ROWE PRICE NEW HORIZONS FUND, INC.

T. ROWE PRICE NEW INCOME FUND, INC.
T. Rowe Price New Income Fund--Advisor Class
T. Rowe Price New Income Fund--R Class

T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
T. Rowe Price Personal Strategy Balanced Fund
T. Rowe Price Personal Strategy Growth Fund
T. Rowe Price Personal Strategy Income Fund

T. ROWE PRICE PRIME RESERVE FUND, INC.

T. ROWE PRICE REAL ESTATE FUND, INC.
T. Rowe Price Real Estate Fund --Advisor Class 

T. ROWE PRICE RESERVE INVESTMENT FUNDS, INC.
T. Rowe Price Government Reserve Investment Fund
T. Rowe Price Reserve Investment Fund

T. ROWE PRICE RETIREMENT FUNDS, INC.
T. Rowe Price Retirement 2005 Fund
T. Rowe Price Retirement 2010 Fund
T. Rowe Price Retirement 2010 Fund--Advisor Class
T. Rowe Price Retirement 2010 Fund--R Class
T. Rowe Price Retirement 2015 Fund
T. Rowe Price Retirement 2020 Fund
T. Rowe Price Retirement 2020 Fund--Advisor Class
T. Rowe Price Retirement 2020 Fund--R Class
T. Rowe Price Retirement 2025 Fund
T. Rowe Price Retirement 2030 Fund
T. Rowe Price Retirement 2030 Fund--Advisor Class
T. Rowe Price Retirement 2030 Fund--R Class
T. Rowe Price Retirement 2035 Fund
T. Rowe Price Retirement 2040 Fund
T. Rowe Price Retirement 2040 Fund--Advisor Class
T. Rowe Price Retirement 2040 Fund--R Class
T. Rowe Price Retirement 2045 Fund
T. Rowe Price Retirement Income Fund
T. Rowe Price Retirement Income Fund--Advisor Class
T. Rowe Price Retirement Income Fund--R Class

T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. Rowe Price Science & Technology Fund--Advisor Class

T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. Rowe Price Short-Term Bond Fund--Advisor Class

T. ROWE PRICE SMALL-CAP STOCK FUND, INC.
T. Rowe Price Small-Cap Stock Fund--Advisor Class

T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. Rowe Price Small-Cap Value Fund--Advisor Class

T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
Spectrum International Fund

T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Florida Intermediate Tax-Free Fund
Georgia Tax-Free Bond Fund
Maryland Short-Term TaxFree Bond Fund
Maryland Tax-Free Bond Fund
Maryland Tax-Free Money Fund
New Jersey Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund

T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund
T. Rowe Price Summit GNMA Fund

T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Income Fund
T. Rowe Price Summit Municipal Intermediate Fund
T. Rowe Price Summit Municipal Money Market Fund

T. ROWE PRICE TAX-EFFICIENT FUNDS, INC.
T. Rowe Price Tax-Efficient Balanced Fund
T. Rowe Price Tax-Efficient Growth Fund
T. Rowe Price Tax-Efficient Multi-Cap Growth Fund

T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. Rowe Price Tax-Free Income Fund--Advisor Class

T. ROWE PRICE TAX-FREE INTERMEDIATE BOND FUND, INC.

T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.

T. ROWE PRICE U.S. BOND INDEX FUND, INC.

T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund

T. ROWE PRICE VALUE FUND, INC.
T. Rowe Price Value Fund--Advisor Class

AMENDMENT NO. 1

AGREEMENT

between

T. ROWE PRICE ASSOCIATES, INC.

and

THE T. ROWE PRICE FUNDS

for

FUND ACCOUNTING SERVICES

     The Agreement for Fund Accounting Services of January 1, 2006, between T. Rowe Price Associates, Inc. and each of the Parties listed on Appendix A thereto is hereby amended, as of February 7, 2006, by adding thereto T.Rowe Price International Funds, Inc., on behalf of T.Rowe Price Global Stock Fund--Advisor Class.

T. ROWE PRICE BALANCED FUND, INC.

T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. Rowe Price Blue Chip Growth Fund--Advisor Class
T. Rowe Price Blue Chip Growth Fund--R Class

T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund

T. ROWE PRICE CAPITAL APPRECIATION FUND
T. Rowe Price Capital Appreciation Fund--Advisor Class

T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.
T. Rowe Price Capital Opportunity Fund--Advisor Class
T. Rowe Price Capital Opportunity Fund--R Class

T. ROWE PRICE CORPORATE INCOME FUND, INC.

T. ROWE PRICE DEVELOPING TECHNOLOGIES FUND, INC.

T. ROWE PRICE DIVERSIFIED MID-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVERSIFIED SMALL-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. Rowe Price Dividend Growth Fund--Advisor Class

T. ROWE PRICE EQUITY INCOME FUND
T. Rowe Price Equity Income Fund--Advisor Class
T. Rowe Price Equity Income Fund--R Class

T. ROWE PRICE EQUITY SERIES, INC.
T. Rowe Price Blue Chip Growth Portfolio
T. Rowe Price Blue Chip Growth Portfolio-II
T. Rowe Price Equity Income Portfolio
T. Rowe Price Equity Income Portfolio-II
T. Rowe Price Equity Index 500 Portfolio
T. Rowe Price Health Sciences Portfolio
T. Rowe Price Health Sciences Portfolio-II
T. Rowe Price Mid-Cap Growth Portfolio
T. Rowe Price Mid-Cap Growth Portfolio-II
T. Rowe Price New America Growth Portfolio
T. Rowe Price Personal Strategy Balanced Portfolio

T. ROWE PRICE FINANCIAL SERVICES FUND, INC.

T. ROWE PRICE FIXED INCOME SERIES, INC.
T. Rowe Price Limited-Term Bond Portfolio
T. Rowe Price Limited-Term Bond Portfolio-II
T. Rowe Price Prime Reserve Portfolio

T. ROWE PRICE GLOBAL TECHNOLOGY FUND, INC.

T. ROWE PRICE GNMA FUND

T. ROWE PRICE GROWTH & INCOME FUND, INC.

T. ROWE PRICE GROWTH STOCK FUND, INC.
T. Rowe Price Growth Stock Fund--Advisor Class
T. Rowe Price Growth Stock Fund--R Class

T. ROWE PRICE HEALTH SCIENCES FUND, INC.

T. ROWE PRICE HIGH YIELD FUND, INC.
T. Rowe Price High Yield Fund--Advisor Class

T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index 500 Fund
T. Rowe Price Extended Equity Market Index Fund
T. Rowe Price Total Equity Market Index Fund

T. ROWE PRICE INFLATION PROTECTED BOND FUND, INC.

T. ROWE PRICE INSTITUTIONAL EQUITY FUNDS, INC.
T. Rowe Price Institutional Large-Cap Core Growth Fund
T. Rowe Price Institutional Large-Cap Growth Fund
T. Rowe Price Institutional Large-Cap Value Fund
T. Rowe Price Institutional Mid-Cap Equity Growth Fund
T. Rowe Price Institutional Small-Cap Stock Fund

T. ROWE PRICE INSTITUTIONAL INCOME FUNDS, INC.
T. Rowe Price Institutional Core Plus Fund
T. Rowe Price Institutional High Yield Fund

T. ROWE PRICE INSTITUTIONAL INTERNATIONAL FUNDS, INC.
T. Rowe Price Institutional Emerging Markets Equity Fund
T. Rowe Price Institutional Foreign Equity Fund

T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price Emerging Europe & Mediterranean Fund
T. Rowe Price Emerging Markets Bond Fund
T. Rowe Price Emerging Markets Stock Fund
T. Rowe Price European Stock Fund
T. Rowe Price Global Stock Fund
T. Rowe Price Global Stock Fund--Advisor Class
T. Rowe Price International Bond Fund
T. Rowe Price International Bond Fund--Advisor Class
T. Rowe Price International Discovery Fund
T. Rowe Price International Growth & Income Fund
T. Rowe Price International Growth & Income Fund--Advisor Class
T. Rowe Price International Growth & Income Fund--R Class
T. Rowe Price International Stock Fund
T. Rowe Price International Stock Fund--Advisor Class
T. Rowe Price International Stock Fund--R Class
T. Rowe Price Japan Fund
T. Rowe Price Latin America Fund
T. Rowe Price New Asia Fund

T. ROWE PRICE INTERNATIONAL INDEX FUND, INC.
T. Rowe Price International Equity Index Fund

T. ROWE PRICE INTERNATIONAL SERIES, INC.
T. Rowe Price International Stock Portfolio

T. ROWE PRICE MEDIA & TELECOMMUNICATIONS FUND, INC.

T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. Rowe Price Mid-Cap Growth Fund--Advisor Class
T. Rowe Price Mid-Cap Growth Fund--R Class

T. ROWE PRICE MID-CAP VALUE FUND, INC.
T. Rowe Price Mid-Cap Value Fund--Advisor Class
T. Rowe Price Mid-Cap Value Fund--R Class

T. ROWE PRICE NEW AMERICA GROWTH FUND
T. Rowe Price New America Growth Fund--Advisor Class

T. ROWE PRICE NEW ERA FUND, INC.

T. ROWE PRICE NEW HORIZONS FUND, INC.

T. ROWE PRICE NEW INCOME FUND, INC.
T. Rowe Price New Income Fund--Advisor Class
T. Rowe Price New Income Fund--R Class

T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
T. Rowe Price Personal Strategy Balanced Fund
T. Rowe Price Personal Strategy Growth Fund
T. Rowe Price Personal Strategy Income Fund

T. ROWE PRICE PRIME RESERVE FUND, INC.

T. ROWE PRICE REAL ESTATE FUND, INC.
T. Rowe Price Real Estate Fund--Advisor Class

T. ROWE PRICE RESERVE INVESTMENT FUNDS, INC.
T. Rowe Price Government Reserve Investment Fund
T. Rowe Price Reserve Investment Fund

T. ROWE PRICE RETIREMENT FUNDS, INC.
T. Rowe Price Retirement 2005 Fund
T. Rowe Price Retirement 2010 Fund
T. Rowe Price Retirement 2010 Fund--Advisor Class
T. Rowe Price Retirement 2010 Fund--R Class
T. Rowe Price Retirement 2015 Fund
T. Rowe Price Retirement 2020 Fund
T. Rowe Price Retirement 2020 Fund--Advisor Class
T. Rowe Price Retirement 2020 Fund--R Class
T. Rowe Price Retirement 2025 Fund
T. Rowe Price Retirement 2030 Fund
T. Rowe Price Retirement 2030 Fund--Advisor Class
T. Rowe Price Retirement 2030 Fund--R Class
T. Rowe Price Retirement 2035 Fund
T. Rowe Price Retirement 2040 Fund
T. Rowe Price Retirement 2040 Fund--Advisor Class
T. Rowe Price Retirement 2040 Fund--R Class
T. Rowe Price Retirement 2045 Fund
T. Rowe Price Retirement Income Fund
T. Rowe Price Retirement Income Fund--Advisor Class
T. Rowe Price Retirement Income Fund--R Class

T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. Rowe Price Science & Technology Fund--Advisor Class

T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. Rowe Price Short-Term Bond Fund--Advisor Class

T. ROWE PRICE SMALL-CAP STOCK FUND, INC.
T. Rowe Price Small-Cap Stock Fund--Advisor Class

T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. Rowe Price Small-Cap Value Fund--Advisor Class

T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
Spectrum International Fund

T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Florida Intermediate Tax-Free Fund
Georgia Tax-Free Bond Fund
Maryland Short-Term TaxFree Bond Fund
Maryland Tax-Free Bond Fund
Maryland Tax-Free Money Fund
New Jersey Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund

T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund
T. Rowe Price Summit GNMA Fund

T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Income Fund
T. Rowe Price Summit Municipal Intermediate Fund
T. Rowe Price Summit Municipal Money Market Fund

T. ROWE PRICE TAX-EFFICIENT FUNDS, INC.
T. Rowe Price Tax-Efficient Balanced Fund
T. Rowe Price Tax-Efficient Growth Fund
T. Rowe Price Tax-Efficient Multi-Cap Growth Fund

T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. Rowe Price Tax-Free Income Fund--Advisor Class

T. ROWE PRICE TAX-FREE INTERMEDIATE BOND FUND, INC.

T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.

T. ROWE PRICE U.S. BOND INDEX FUND, INC.

T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund

T. ROWE PRICE VALUE FUND, INC.
T. Rowe Price Value Fund--Advisor Class

Attest:

/s/Patricia B. Lippert                  /s/Joseph A. Carrier
Patricia B. Lippert             By:     Joseph A. Carrier
Secretary                               Treasurer


Attest:                                 T. ROWE PRICE ASSOCIATES, INC.

/s/Barbara A. Van Horn                  /s/Henry H. Hopkins
Barbara A. Van Horn             By:     Henry H. Hopkins
Secretary                               Vice President

AMENDMENT NO. 2

AGREEMENT

between

T. ROWE PRICE ASSOCIATES, INC.

and

THE T. ROWE PRICE FUNDS

for

FUND ACCOUNTING SERVICES

     The Agreement for Fund Accounting Services of January 1, 2006, between T. Rowe Price Associates, Inc. and each of the Parties listed on Appendix A thereto is hereby amended, as of February 7, 2006 and April 19, 2006, by adding thereto T.Rowe Price Institutional International Funds, Inc., on behalf of T.Rowe Price Institutional Global Equity Fund.

T. ROWE PRICE BALANCED FUND, INC.

T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. Rowe Price Blue Chip Growth Fund--Advisor Class
T. Rowe Price Blue Chip Growth Fund--R Class

T. ROWE PRICE CALIFORNIA TAX-FREE INCOME TRUST
California Tax-Free Bond Fund
California Tax-Free Money Fund

T. ROWE PRICE CAPITAL APPRECIATION FUND
T. Rowe Price Capital Appreciation Fund--Advisor Class

T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.
T. Rowe Price Capital Opportunity Fund--Advisor Class
T. Rowe Price Capital Opportunity Fund--R Class

T. ROWE PRICE CORPORATE INCOME FUND, INC.

T. ROWE PRICE DEVELOPING TECHNOLOGIES FUND, INC.

T. ROWE PRICE DIVERSIFIED MID-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVERSIFIED SMALL-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVIDEND GROWTH FUND, INC.
T. Rowe Price Dividend Growth Fund--Advisor Class

T. ROWE PRICE EQUITY INCOME FUND
T. Rowe Price Equity Income Fund--Advisor Class
T. Rowe Price Equity Income Fund--R Class

T. ROWE PRICE EQUITY SERIES, INC.
T. Rowe Price Blue Chip Growth Portfolio
T. Rowe Price Blue Chip Growth Portfolio-II
T. Rowe Price Equity Income Portfolio
T. Rowe Price Equity Income Portfolio-II
T. Rowe Price Equity Index 500 Portfolio
T. Rowe Price Health Sciences Portfolio
T. Rowe Price Health Sciences Portfolio-II
T. Rowe Price Mid-Cap Growth Portfolio
T. Rowe Price Mid-Cap Growth Portfolio-II
T. Rowe Price New America Growth Portfolio
T. Rowe Price Personal Strategy Balanced Portfolio

T. ROWE PRICE FINANCIAL SERVICES FUND, INC.

T. ROWE PRICE FIXED INCOME SERIES, INC.
T. Rowe Price Limited-Term Bond Portfolio
T. Rowe Price Limited-Term Bond Portfolio-II
T. Rowe Price Prime Reserve Portfolio

T. ROWE PRICE GLOBAL TECHNOLOGY FUND, INC.

T. ROWE PRICE GNMA FUND

T. ROWE PRICE GROWTH & INCOME FUND, INC.

T. ROWE PRICE GROWTH STOCK FUND, INC.
T. Rowe Price Growth Stock Fund--Advisor Class
T. Rowe Price Growth Stock Fund--R Class

T. ROWE PRICE HEALTH SCIENCES FUND, INC.

T. ROWE PRICE HIGH YIELD FUND, INC.
T. Rowe Price High Yield Fund--Advisor Class

T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index 500 Fund
T. Rowe Price Extended Equity Market Index Fund
T. Rowe Price Total Equity Market Index Fund

T. ROWE PRICE INFLATION PROTECTED BOND FUND, INC.

T. ROWE PRICE INSTITUTIONAL EQUITY FUNDS, INC.
T. Rowe Price Institutional Large-Cap Core Growth Fund
T. Rowe Price Institutional Large-Cap Growth Fund
T. Rowe Price Institutional Large-Cap Value Fund
T. Rowe Price Institutional Mid-Cap Equity Growth Fund
T. Rowe Price Institutional Small-Cap Stock Fund

T. ROWE PRICE INSTITUTIONAL INCOME FUNDS, INC.
T. Rowe Price Institutional Core Plus Fund
T. Rowe Price Institutional High Yield Fund

T. ROWE PRICE INSTITUTIONAL INTERNATIONAL FUNDS, INC.
T. Rowe Price Institutional Emerging Markets Equity Fund
T. Rowe Price Institutional Foreign Equity Fund
T. Rowe Price Institutional Global Equity Fund

T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price Emerging Europe & Mediterranean Fund
T. Rowe Price Emerging Markets Bond Fund
T. Rowe Price Emerging Markets Stock Fund
T. Rowe Price European Stock Fund
T. Rowe Price Global Stock Fund
T. Rowe Price Global Stock Fund--Advisor Class
T. Rowe Price International Bond Fund
T. Rowe Price International Bond Fund--Advisor Class
T. Rowe Price International Discovery Fund
T. Rowe Price International Growth & Income Fund
T. Rowe Price International Growth & Income Fund--Advisor Class
T. Rowe Price International Growth & Income Fund--R Class
T. Rowe Price International Stock Fund
T. Rowe Price International Stock Fund--Advisor Class
T. Rowe Price International Stock Fund--R Class
T. Rowe Price Japan Fund
T. Rowe Price Latin America Fund
T. Rowe Price New Asia Fund

T. ROWE PRICE INTERNATIONAL INDEX FUND, INC.
T. Rowe Price International Equity Index Fund

T. ROWE PRICE INTERNATIONAL SERIES, INC.
T. Rowe Price International Stock Portfolio

T. ROWE PRICE MEDIA & TELECOMMUNICATIONS FUND, INC.

T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. Rowe Price Mid-Cap Growth Fund--Advisor Class
T. Rowe Price Mid-Cap Growth Fund--R Class

T. ROWE PRICE MID-CAP VALUE FUND, INC.
T. Rowe Price Mid-Cap Value Fund--Advisor Class
T. Rowe Price Mid-Cap Value Fund--R Class

T. ROWE PRICE NEW AMERICA GROWTH FUND
T. Rowe Price New America Growth Fund--Advisor Class

T. ROWE PRICE NEW ERA FUND, INC.

T. ROWE PRICE NEW HORIZONS FUND, INC.

T. ROWE PRICE NEW INCOME FUND, INC.
T. Rowe Price New Income Fund--Advisor Class
T. Rowe Price New Income Fund--R Class

T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
T. Rowe Price Personal Strategy Balanced Fund
T. Rowe Price Personal Strategy Growth Fund
T. Rowe Price Personal Strategy Income Fund

T. ROWE PRICE PRIME RESERVE FUND, INC.

T. ROWE PRICE REAL ESTATE FUND, INC.
T. Rowe Price Real Estate Fund--Advisor Class

T. ROWE PRICE RESERVE INVESTMENT FUNDS, INC.
T. Rowe Price Government Reserve Investment Fund
T. Rowe Price Reserve Investment Fund

T. ROWE PRICE RETIREMENT FUNDS, INC.
T. Rowe Price Retirement 2005 Fund
T. Rowe Price Retirement 2010 Fund
T. Rowe Price Retirement 2010 Fund--Advisor Class
T. Rowe Price Retirement 2010 Fund--R Class
T. Rowe Price Retirement 2015 Fund
T. Rowe Price Retirement 2020 Fund
T. Rowe Price Retirement 2020 Fund--Advisor Class
T. Rowe Price Retirement 2020 Fund--R Class
T. Rowe Price Retirement 2025 Fund
T. Rowe Price Retirement 2030 Fund
T. Rowe Price Retirement 2030 Fund--Advisor Class
T. Rowe Price Retirement 2030 Fund--R Class
T. Rowe Price Retirement 2035 Fund
T. Rowe Price Retirement 2040 Fund
T. Rowe Price Retirement 2040 Fund--Advisor Class
T. Rowe Price Retirement 2040 Fund--R Class
T. Rowe Price Retirement 2045 Fund
T. Rowe Price Retirement Income Fund
T. Rowe Price Retirement Income Fund--Advisor Class
T. Rowe Price Retirement Income Fund--R Class

T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.
T. Rowe Price Science & Technology Fund--Advisor Class

T. ROWE PRICE SHORT-TERM BOND FUND, INC.
T. Rowe Price Short-Term Bond Fund--Advisor Class

T. ROWE PRICE SMALL-CAP STOCK FUND, INC.
T. Rowe Price Small-Cap Stock Fund--Advisor Class

T. ROWE PRICE SMALL-CAP VALUE FUND, INC.
T. Rowe Price Small-Cap Value Fund--Advisor Class

T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
Spectrum International Fund

T. ROWE PRICE STATE TAX-FREE INCOME TRUST
Florida Intermediate Tax-Free Fund
Georgia Tax-Free Bond Fund
Maryland Short-Term TaxFree Bond Fund
Maryland Tax-Free Bond Fund
Maryland Tax-Free Money Fund
New Jersey Tax-Free Bond Fund
New York Tax-Free Bond Fund
New York Tax-Free Money Fund
Virginia Tax-Free Bond Fund

T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund
T. Rowe Price Summit GNMA Fund

T. ROWE PRICE SUMMIT MUNICIPAL FUNDS, INC.
T. Rowe Price Summit Municipal Income Fund
T. Rowe Price Summit Municipal Intermediate Fund
T. Rowe Price Summit Municipal Money Market Fund

T. ROWE PRICE TAX-EFFICIENT FUNDS, INC.
T. Rowe Price Tax-Efficient Balanced Fund
T. Rowe Price Tax-Efficient Growth Fund
T. Rowe Price Tax-Efficient Multi-Cap Growth Fund

T. ROWE PRICE TAX-EXEMPT MONEY FUND, INC.

T. ROWE PRICE TAX-FREE HIGH YIELD FUND, INC.

T. ROWE PRICE TAX-FREE INCOME FUND, INC.
T. Rowe Price Tax-Free Income Fund--Advisor Class

T. ROWE PRICE TAX-FREE INTERMEDIATE BOND FUND, INC.

T. ROWE PRICE TAX-FREE SHORT-INTERMEDIATE FUND, INC.

T. ROWE PRICE U.S. BOND INDEX FUND, INC.

T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund

T. ROWE PRICE VALUE FUND, INC.
T. Rowe Price Value Fund--Advisor Class

Attest:

/s/Patricia B. Lippert                  /s/Joseph A. Carrier
Patricia B. Lippert             By:     Joseph A. Carrier
Secretary                               Treasurer


Attest:                                 T. ROWE PRICE ASSOCIATES, INC.

/s/Barbara A. Van Horn                  /s/Henry H. Hopkins
Barbara A. Van Horn             By:     Henry H. Hopkins
Secretary                               Vice President

EX-99.13 OTH CONTRCT

AGREEMENT

between

T. ROWE PRICE RETIREMENT PLAN SERVICES, INC.

and

T. ROWE PRICE FUNDS

TABLE
OF CONTENTS 



Page 

Article A       Terms of Appointment    2

Article B       Duties of RPS   2

Article C       Fees and Expenses       2

Article D       Representations and Warranties of RPS   2

Article E       Representations and Warranties of the Fund      3

Article F       Standard of Care/Indemnification        3

Article G       Dual Interests  6

Article H       Documentation   6

Article I       Recordkeeping/Confidentiality   8

Article J       Ownership of Software and Related Material      8

Article K       As Of Transactions      8
              1.        Reporting       9
              2.        Liability       10

Article L       Term and Termination of Agreement       12

Article M       Notice          12

Article N       Assignment      12

Article O       Amendment/Interpretive Provisions       13

Article P       Further Assurances      13

Article Q       Maryland Law to Apply   13

Article R       Merger of Agreement     13

Article S       Counterparts    13

Article T       The Parties     13


Article U       Directors, Trustees and Shareholders and Massachusetts Business Trust   14

Article V       Captions                14

SCHEDULE 1
APPENDIX A

     AGREEMENT, made as of the first day of January, 2006, by and between T. ROWE PRICE RETIREMENT PLAN SERVICES, INC., a Maryland corporation having its principal office and place of business at 100 East Pratt Street, Baltimore, Maryland 21202 ("RPS"), and EACH FUND WHICH IS LISTED ON APPENDIX A (as such Appendix may be amended from time to time) and which evidences its agreement to be bound hereby by executing a copy of this Agreement (each Fund hereinafter referred to as "the Fund") whose definition may be found in Article T;

     WHEREAS, the Funds are named investment options under various tax-sheltered plans, including, but not limited to, state and local government deferred compensation plans, 403(b) plans, and profit sharing, thrift, 401(k) and money purchase pension plans for self-employed individuals, professional partnerships and corporations (collectively referred to as "Retirement Plans"); and the Fund has determined that such investments of Retirement Plans in the Funds are in the best longterm interest of the Funds;

     WHEREAS, RPS has the capability of providing services, on behalf of the Fund, for the accounts of individuals ("Participants") participating in these Retirement Plans ("Retirement Accounts");

     WHEREAS, RPS represents that it is registered with the Securities and Exchange Commission as a Transfer Agent under Section 17A of the Securities Exchange Act of 1934 (the "'34 Act");

     WHEREAS, the Fund desires to contract with RPS to provide the functions and services described herein in connection with the Retirement Plans and Retirement Accounts; and

     WHEREAS, RPS may subcontract or jointly contract with other parties on behalf of the Funds to perform certain of the functions described herein.

     NOW THEREFORE, in consideration of the mutual covenants herein contained, the parties hereto agree as follows:

A. Terms of Appointment

      Subject to the terms and conditions set forth in this Agreement, the Fund hereby employs and appoints RPS to perform the services and functions described herein in connection with certain Retirement Plans and Retirement Accounts as agreed upon by the parties.

B. Duties of RPS

     RPS agrees that it will perform the services set forth on Schedule 1 of this Agreement in accordance with all rules and regulations, the Fund's then-current prospectus, and policies and procedures adopted by RPS.

C. Fees and Expenses

      For the services performed on Schedule 1 of this Agreement, the Fund shall pay the fees and expenses as mutually agreed upon by both parties.

D. Representations and Warranties of RPS

     RPS represents and warrants to the Fund that:

1. It is a corporation duly organized and existing and in good standing under the laws of Maryland.

2. It is duly qualified to carry on its business in Alaska, California, Colorado, District of Columbia, Florida, Illinois, Maryland, Massachusetts, New Jersey and Virginia.

3. It is empowered under applicable laws and by its charter and by-laws to enter into and perform this Agreement.

4. All requisite corporate proceedings have been taken to authorize it to enter into and perform this Agreement.

5. It has and will continue to have access to the necessary facilities, equipment and personnel to perform its duties and obligations under this Agreement.

6. It is registered with the Securities and Exchange Commission as a Transfer Agent pursuant to Section 17A of the '34 Act.

E. Representations and Warranties of the Fund

     The Fund represents and warrants to RPS that:

1. It is a corporation or business trust duly organized and existing and in good standing under the laws of Maryland, or Massachusetts, as the case may be.

2. It is empowered under applicable laws and by its Articles of Incorporation or Declaration of Trust, as the case may be, and By-Laws to enter into and perform this Agreement.

3. All proceedings required by said Articles of Incorporation or Declaration of Trust, as the case may be, and By-Laws have been taken to authorize it to enter into and perform this Agreement.

4. It is an investment company registered under the '40 Act.

5. A registration statement under the Securities Act of 1933 (the "'33 Act") is currently effective and will remain effective, and appropriate state securities law filing have been made and will continue to be made, with respect to all shares of the Fund being offered for sale.

F. Standard of Care/Indemnification

     Notwithstanding anything to the contrary in this Agreement:

1. RPS shall not be liable to the Fund for any act or failure to act by it or its agents or subcontractors on behalf of the Fund in carrying or attempting to carry out the terms and provisions of this Agreement provided RPS has acted in good faith and without negligence or willful misconduct and selected and monitored the performance of its agents and subcontractors with reasonable care.

2. The Fund shall indemnify and hold RPS harmless from and against all losses, costs, damages, claims, actions and expenses, including reasonable expenses for legal counsel, incurred by RPS resulting from: (i) any action or omission by RPS or its agents or subcontractors in the performance of their duties hereunder; (ii) RPS acting upon instructions reasonably believed by it to have been executed by a duly authorized officer of the Fund; or (iii) RPS acting upon information provided by the Fund in form and under policies agreed to by RPS and the Fund. RPS shall not be entitled to such indemnification in respect of actions or omissions constituting negligence or willful misconduct of RPS or where RPS has not exercised reasonable care in selecting or monitoring the performance of its agents or subcontractors.

3. Except as provided in Article K of this Agreement, RPS shall indemnify and hold harmless the Fund from all losses, costs, damages, claims, actions and expenses, including reasonable expenses for legal counsel, incurred by the Fund resulting from negligence or willful misconduct of RPS or which result from RPS' failure to exercise reasonable care in selecting or monitoring the performance of its agents or subcontractors. The Fund shall not be entitled to such indemnification in respect of actions or omissions constituting negligence or willful misconduct of such Fund or its agents or subcontractors; unless such negligence or misconduct is attributable to RPS.

4. In determining RPS' liability, an isolated error or omission will normally not be deemed to constitute negligence when it is determined that:

1. RPS had in place "appropriate procedures;"

1. the employees responsible for the error or omission had been reasonably trained and were being appropriately monitored; and

1. no evidence or circumstances have been produced to indicate that the individual who committed the error or omission was functioning in bad faith, gross negligence or willful misconduct at the time of the incident.

It is understood that RPS is not obligated to have in place separate procedures to prevent each and every conceivable type of error or omission. The term "appropriate procedures" shall mean procedures reasonably designed to prevent and detect errors and omissions. In determining the reasonableness of such procedures, weight will be given to such factors as are appropriate, including the prior occurrence of any similar errors or omissions when such procedures were in place and transfer agent industry standards in place at the time of the occurrence.

5. In the event either party is unable to perform its obligations under the terms of this Agreement because of acts of God, strikes or other causes reasonably beyond its control, such party shall not be liable to the other party for any loss, cost, damage, claims, actions or expense resulting from such failure to perform or otherwise from such causes.

6. In order that the indemnification provisions contained in this Article F shall apply, upon the assertion of a claim for which either party may be required to indemnify the other, the party seeking indemnification shall promptly notify the other party of such assertion, and shall keep the other party advised with respect to all developments concerning such claim. The party who may be required to indemnify shall have the option to participate with the party seeking indemnification in the defense of such claim, or to defend against said claim in its own name or in the name of the other party. The party seeking indemnification shall in no case confess any claim or make any compromise in any case in which the other party may be required to indemnify it except with the other party's prior written consent.

7. Neither party to this Agreement shall be liable to the other party for consequential damages under any provision of this Agreement.

G. Dual Interests

     It is understood that some person or persons may be directors, officers, or shareholders of both RPS and the Fund and that the existence of any such dual interest shall not affect the validity of this Agreement or of any transactions hereunder except as otherwise provided by a specific provision of applicable law.

H. Documentation

1. As requested by RPS, the Fund shall promptly furnish to RPS the following:

a. copy of the resolution of the Directors/Trustees of the Fund authorizing the appointment of RPS and the execution and delivery of this Agreement;

b. A copy of the Articles of Incorporation or Declaration of Trust, as the case may be, and By-Laws of the Fund and all amendments thereto;

c. An opinion of counsel for the Fund with respect to the validity of the stock, the number of Shares authorized, the status of redeemed Shares, and the number of Shares with respect to which a Registration Statement has been filed and is in effect; and

d. A copy of the Fund's current and new prospectuses and shareholder reports issued by the Fund.

     The delivery of any such document to either party hereto for the purpose of any other agreement to which the Fund and RPS are or were parties shall be deemed to be delivery for the purposes of this Agreement.

2. As requested by RPS, the Fund will also furnish to RPS from time to time the following documents:

a. Each resolution of the Board of Directors/Trustees of the Fund authorizing the original issue of its shares;

b. Each Registration Statement filed with the Securities and Exchange Commission and amendments and orders thereto in effect with respect to the sale of shares with respect to the Fund;

c. A certified copy of each amendment to the Articles of Incorporation or Declaration of Trust, and the ByLaws of the Fund;

d. Certified copies of each vote of the Board of Directors/Trustees authorizing officers to give instructions to the Fund; and

e. Such other documents or opinions which RPS, in its discretion, may reasonably deem necessary or appropriate in the proper performance of its duties under this Agreement.

3. RPS hereby agrees to establish and maintain facilities and procedures reasonably acceptable to the Fund for safekeeping of check forms and facsimile signature imprinting devices, if any, and for the preparation or use, and for keeping account of, such forms and devices.

I. Recordkeeping/Confidentiality

1. RPS shall keep records relating to the services to be performed hereunder, in the form and manner as it may deem advisable, provided that RPS shall keep all records in such form and in such manner as required by applicable law, including the '40 Act and the '34 Act.

2. RPS and the Fund agree that all books, records, information and data pertaining to the business of the other party which are exchanged or received pursuant to the negotiation or the carrying out of this Agreement shall remain confidential, and shall not be voluntarily disclosed to any other person, except: (a)after prior notification to and approval in writing by the other party hereto, which approval shall not be unreasonably withheld and may not be withheld where RPS or the Fund may be exposed to civil or criminal contempt proceedings for failure to comply; (b) when requested to divulge such information by duly constituted governmental authorities; (c) after so requested by the other party hereto; or (d) by the Administrator.

J. Ownership of Software and Related Material

     All computer programs, magnetic tapes, written procedures and similar items purchased and/or developed and used by RPS in performance of the Agreement shall be the property of RPS and will not become the property of the Fund.

K. As Of Transactions

     For purposes of this Article K, the term "Transaction" shall mean any single or "related transaction" (as defined below) involving the purchase or redemption of shares (including exchanges) processed at a time other than the time of the computation of the Fund's net asset value per share next computed after receipt of any such transaction order by RPS due to an act or omission of RPS. "As Of Processing" refers to the processing of these Transactions. All As Of Processing may only be performed in accordance with the requirements of Rule 22c-1 of the '40 Act. RPS is responsible for monitoring As Of Transactions procedures that set forth the circumstances under which As Of Transactions are permitted. If more than one Transaction ("Related Transaction") in the Fund is caused by or occurs as a result of the same act or omission, such transactions shall be aggregated with other transactions in the Fund and be considered as one Transaction.

1. Reporting

RPS shall:

a. Utilize a system to identify all Transactions, and shall compute the net effect of such Transactions upon the Fund on a daily, monthly and rolling 365 day basis. The monthly and rolling 365 day periods are hereinafter referred to as "Cumulative."

b. Supply to the Fund, from time to time as mutually agreed upon, a report summarizing the Transactions and the daily and Cumulative net effects of such Transactions both in terms of aggregate dilution and loss ("Dilution") or gain and negative dilution ("Gain") experienced by the Fund, and the impact such Gain or Dilution has had upon the Funds net asset value per share.

c. With respect to any Transaction which causes Dilution to the Fund of $100,000 or more, immediately provide the Fund: (i) a report identifying the Transaction and the Dilution resulting therefrom, (ii) the reason such Transaction was processed as described above, and (iii) the action that RPS has or intends to take to prevent the reoccurrence of such as of processing ("Report").

2. Liability

a. It will be the normal practice of the Fund not to hold RPS liable with respect to any Transaction which causes Dilution to any single Fund of less than $25,000. RPS will, however, closely monitor for each Fund the daily and Cumulative Gain/Dilution which is caused by Transactions of less than $25,000. When the Cumulative Dilution to any Fund exceeds 3/10 of 1% of net asset value per share, RPS, in consultation with counsel to the Fund, will make appropriate inquiry to determine whether it should take any remedial action. RPS will report to the Board of Directors/Trustees of the Fund ("Board"), as appropriate, any action it has taken.

b. Where a Transaction causes Dilution to a Fund equal to or greater than $25,000 ("Significant Transaction") but less than $100,000, RPS will review with Counsel to the Fund the circumstances surrounding the underlying Significant Transaction to determine whether the Significant Transaction was caused by or occurred as a result of a negligent act or omission by RPS. If it is determined that the Dilution is the result of a negligent action or omission by RPS, RPS and outside counsel for the Fund will negotiate settlement. All such Significant Transactions will be reported to the Audit Committee at least annually (unless the settlement fully compensates the Fund for any Dilution). Any Significant Transaction, however, causing Dilution in excess of the lesser of $100,000 or a penny per share will be promptly reported to the Board and resolved at the next scheduled Board Meeting. Settlement for Significant Transactions causing Dilution of $100,000 or more will not be entered into until approved by the Board. The factors to consider in making any determination regarding the settlement of a Significant Transaction would include but not be limited to:

i. Procedures and controls adopted by RPS to prevent As Of Processing;

ii. Whether such procedures and controls were being followed at the time of the Significant Transaction;

iii. The absolute and relative volume of all transactions processed by RPS on the day of the Significant Transaction;

iv. The number of Transactions processed by RPS during prior relevant periods, and the net Dilution/Gain as a result of all such Significant Transactions to the Fund and to all other Funds; and

v. The prior response of RPS to recommendations made by the Funds regarding improvement to RPS' As Of Processing procedures.

c. In determining RPS' liability with respect to a Significant Transaction, an isolated error or omission will normally not be deemed to constitute negligence when it is determined that:

1. RPS had in place "Appropriate Procedures" as defined in Section 4 of Article F of this Agreement (it is understood that RPS is not obligated to have in place separate procedures to prevent each and every conceivable type of error or omission);

1. the employees responsible for the error or omission had been reasonably trained and were being appropriately monitored; and

1. no evidence or circumstances have been produced to indicate that the individual who committed the error or omission was functioning in bad faith, gross negligence or willful misconduct at the time of the incident.

L. Term and Termination of Agreement

1. This Agreement shall run for a period of one (1) year from the date first written above and will be renewed from year to year thereafter unless terminated by either party as provided hereunder.

2. This Agreement may be terminated by the Funds upon one hundred twenty (120) days' prior written notice to RPS; and by RPS, upon three hundred sixty-five (365) days' prior written notice to the Fund.

3. Upon termination hereof, the Fund shall pay to RPS such compensation as may be due as of the date of such termination, and shall likewise reimburse for out-of-pocket expenses related to its services hereunder.

M. Notice

     Any notice as required by this Agreement shall be sufficiently given (i) when sent to an authorized person of the other party at the address of such party set forth above or at such other address as such party may from time to time specify in writing to the other party; or (ii) as otherwise agreed upon by appropriate officers of the parties hereto.

N. Assignment

     Neither this Agreement nor any rights or obligations hereunder may be assigned either voluntarily or involuntarily, by operation of law or otherwise, by either party without the prior written consent of the other party.

O. Amendment/Interpretive Provisions

     The parties by mutual written agreement may amend this Agreement at any time. In addition, in connection with the operation of this Agreement, RPS and the Fund may agree from time to time on such provisions interpretive of or in addition to the provisions of this Agreement as in their joint opinion may be consistent with the general tenor of this Agreement. Any such interpretive or additional provisions are to be signed by all parties and annexed hereto, but no such provision shall contravene any applicable federal or state law or regulation and no such interpretive or additional provision shall be deemed to be an amendment of this Agreement.

P. Further Assurances

     Each party agrees to perform such further acts and execute such further documents as are necessary to effectuate the purposes hereof.

Q. Maryland Law to Apply

     This Agreement shall be construed and the provisions thereof interpreted under and in accordance with the laws of Maryland.

R. Merger of Agreement

     This Agreement, including the attached Schedule supersede any prior agreement with respect to the subject hereof, whether oral or written.

S. Counterparts

     This Agreement may be executed by the parties hereto in any number of counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.

T. The Parties

     All references herein to "the Fund" are to each of the Funds listed on Appendix A individually, as if this Agreement were between such individual Fund and RPS. In the case of a series Fund or trust, all references to "the Fund" are to the individual series or portfolio of such Fund or trust, or to such Fund or trust on behalf of the individual series or portfolio, as appropriate. The "Fund" also includes any T. Rowe Price Fund which may be established after the date of this Agreement. Any reference in this Agreement to "the parties" shall mean RPS and such other individual Fund as to which the matter pertains.

U. Directors, Trustees and Shareholders and Massachusetts Business Trust

     It is understood and is expressly stipulated that neither the holders of shares in the Fund nor any Directors or Trustees of the Fund shall be personally liable hereunder. With respect to any Fund which is a party to this Agreement and which is organized as a Massachusetts business trust, the term "Fund" means and refers to the trustees from time to time serving under the applicable trust agreement (Declaration of Trust) of such Trust as the same may be amended from time to time. It is expressly agreed that the obligations of any such Trust hereunder shall not be binding upon any of the trustees, shareholders, nominees, officers, agents or employees of the Trust, personally, but bind only the trust property of the Trust, as provided in the Declaration of Trust of the Trust. The execution and delivery of this Agreement has been authorized by the Trustees and signed by an authorized officer of the Trust, acting as such, and neither such authorization by such Trustees nor such execution and delivery by such officer shall be deemed to have been made by any of them, but shall bind only the trust property of the Trust as provided in its Declaration of Trust.

V. Captions

     The captions in the Agreement are included for convenience of reference only and in no way define or limit any of the provisions hereof or otherwise affect their construction or effect.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their names and on their behalf under their seals by and through their duly authorized officers.

T. ROWE PRICE RETIREMENT PLAN                    T. ROWE PRICE FUNDS SERVICES, INC.

BY:/s/Charles E. Vieth                           BY:/s/Joseph A. Carrier


DATED: March 22, 2006                            DATED: March 16, 2006

SCHEDULE 1

     RPS agrees that it will perform services on behalf of the Funds in accordance with procedures
developed and maintained by RPS, all applicable laws and the Funds then-current
prospectus. Such services include, but are not limited to, the following: 
- Establishing Participant Accounts
- - Processing Purchase and Redemption Orders
- - Receiving and Disbursing Settlement Proceeds
- - Assessing and Remitting Redemption Fees
- - Processing Exchange Orders
- - Processing Maintenance Requests in Participant Accounts
- - Processing Adjustments in Participant Accounts
- - Handling Returned Checks and ACH Debits
- - Processing Dividends, Distributions and Other Fund Corporate Actions Affecting Participant Accounts
- - Preparing and Filing Participant Tax Information
- - Monitoring and Enforcing the Funds Excessive Trading Policy
- - Complying with Procedures for Federal Tax Withholding
- - Responding to Correspondence relating to Participant Accounts
- - Maintaining Telephone, VRU and Computer Services to Service Participant Accounts
- - Distributing and Tabulating Fund Proxies
- - Preparing and Delivering Confirmations, Statements and Tax Forms to Participants
- - Delivering Prospectuses, Shareholder Reports and Other Required Mailings to Participants/Plans in the Fund, as required
- - Coordinating with Independent Public Accountants for Reviews and Audits
- - Maintaining Books and Records for the Funds
- - Maintaining and Providing Information Necessary for the Completion of Form NSAR & N-CSR
- - Furnishing Information to the Fund
- - Performing Bank Reconciliation Process
- - Performing such Other Services as Mutually Agreed Upon by Both Parties

APPENDIX A

T. ROWE PRICE BALANCED FUND, INC.

T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. Rowe Price Blue Chip Growth Fund--R Class

T. ROWE PRICE CAPITAL APPRECIATION FUND

T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.
T. Rowe Price Capital Opportunity Fund--R Class

T. ROWE PRICE CORPORATE INCOME FUND, INC.

T. ROWE PRICE DEVELOPING TECHNOLOGIES FUND, INC.

T. ROWE PRICE DIVERSIFIED MID-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVERSIFIED SMALL-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

T. ROWE PRICE EQUITY INCOME FUND
T. Rowe Price Equity Income Fund--R Class

T. ROWE PRICE FINANCIAL SERVICES FUND, INC.

T. ROWE PRICE GLOBAL TECHNOLOGY FUND, INC.

T. ROWE PRICE GNMA FUND

T. ROWE PRICE GROWTH & INCOME FUND, INC.

T. ROWE PRICE GROWTH STOCK FUND, INC.
T. Rowe Price Growth Stock Fund--R Class

T. ROWE PRICE HEALTH SCIENCES FUND, INC.

T. ROWE PRICE HIGH YIELD FUND, INC.

T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index 500 Fund
T. Rowe Price Extended Equity Market Index Fund
T. Rowe Price Total Equity Market Index Fund

T. ROWE PRICE INFLATION PROTECTED BOND FUND, INC.

T. ROWE PRICE INSTITUTIONAL EQUITY FUNDS, INC.
T. Rowe Price Institutional Large-Cap Core Growth Fund
T. Rowe Price Institutional Large-Cap Growth Fund
T. Rowe Price Institutional Large-Cap Value Fund
T. Rowe Price Institutional Mid-Cap Equity Growth Fund
T. Rowe Price Institutional Small-Cap Stock Fund

T. ROWE PRICE INSTITUTIONAL INCOME FUNDS, INC.
T. Rowe Price Institutional Core Plus Fund
T. Rowe Price Institutional High Yield Fund

T. ROWE PRICE INSTITUTIONAL INTERNATIONAL FUNDS, INC.
T. Rowe Price Institutional Emerging Markets Equity Fund
T. Rowe Price Institutional Foreign Equity Fund

T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price Emerging Europe & Mediterranean Fund
T. Rowe Price Emerging Markets Bond Fund
T. Rowe Price Emerging Markets Stock Fund
T. Rowe Price European Stock Fund
T. Rowe Price Global Stock Fund
T. Rowe Price International Bond Fund
T. Rowe Price International Discovery Fund
T. Rowe Price International Growth & Income Fund
T. Rowe Price International Growth & Income Fund--R Class
T. Rowe Price International Stock Fund
T. Rowe Price International Stock Fund--R Class
T. Rowe Price Japan Fund
T. Rowe Price Latin America Fund
T. Rowe Price New Asia Fund

T. ROWE PRICE INTERNATIONAL INDEX FUND, INC.
T. Rowe Price International Equity Index Fund

T. ROWE PRICE MEDIA & TELECOMMUNICATIONS FUND, INC.

T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. Rowe Price Mid-Cap Growth Fund--R Class

T. ROWE PRICE MID-CAP VALUE FUND, INC.
T. Rowe Price Mid-Cap Value Fund--R Class

T. ROWE PRICE NEW AMERICA GROWTH FUND

T. ROWE PRICE NEW ERA FUND, INC.

T. ROWE PRICE NEW HORIZONS FUND, INC.

T. ROWE PRICE NEW INCOME FUND, INC.
T. Rowe Price New Income Fund--R Class

T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
T. Rowe Price Personal Strategy Balanced Fund
T. Rowe Price Personal Strategy Growth Fund
T. Rowe Price Personal Strategy Income Fund

T. ROWE PRICE PRIME RESERVE FUND, INC.

T. ROWE PRICE REAL ESTATE FUND, INC.

T. ROWE PRICE RETIREMENT FUNDS, INC.
T. Rowe Price Retirement 2005 Fund
T. Rowe Price Retirement 2010 Fund
T. Rowe Price Retirement 2010 Fund--R Class
T. Rowe Price Retirement 2015 Fund
T. Rowe Price Retirement 2020 Fund
T. Rowe Price Retirement 2020 Fund--R Class
T. Rowe Price Retirement 2025 Fund
T. Rowe Price Retirement 2030 Fund
T. Rowe Price Retirement 2030 Fund--R Class
T. Rowe Price Retirement 2035 Fund
T. Rowe Price Retirement 2040 Fund
T. Rowe Price Retirement 2040 Fund--R Class
T. Rowe Price Retirement 2045 Fund
T. Rowe Price Retirement Income Fund
T. Rowe Price Retirement Income Fund--R Class

T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

T. ROWE PRICE SHORT-TERM BOND FUND, INC.

T. ROWE PRICE SMALL-CAP STOCK FUND, INC.

T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
Spectrum International Fund

T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund
T. Rowe Price Summit GNMA Fund

T. ROWE PRICE U.S. BOND INDEX FUND, INC.

T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund

T. ROWE PRICE VALUE FUND, INC.

AMENDMENT NO. 1

AGREEMENT

Between

T. ROWE PRICE RETIREMENT PLAN SERVICES, INC.

and

EACH OF THE PARTIES INDICATED ON APPENDIX A

     The Retirement Plan Services Contract of January 1, 2006, between T. Rowe Price Retirement Plan Services, Inc. and each of the Parties listed on Appendix A thereto is hereby amended, as of April 19, 2006, by adding thereto T.Rowe Price Institutional International Funds, Inc., on behalf of T. Rowe Price Institutional Global Equity Fund.

T. ROWE PRICE BALANCED FUND, INC.

T. ROWE PRICE BLUE CHIP GROWTH FUND, INC.
T. Rowe Price Blue Chip Growth Fund--R Class

T. ROWE PRICE CAPITAL APPRECIATION FUND

T. ROWE PRICE CAPITAL OPPORTUNITY FUND, INC.
T. Rowe Price Capital Opportunity Fund--R Class

T. ROWE PRICE CORPORATE INCOME FUND, INC.

T. ROWE PRICE DEVELOPING TECHNOLOGIES FUND, INC.

T. ROWE PRICE DIVERSIFIED MID-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVERSIFIED SMALL-CAP GROWTH FUND, INC.

T. ROWE PRICE DIVIDEND GROWTH FUND, INC.

T. ROWE PRICE EQUITY INCOME FUND
T. Rowe Price Equity Income Fund--R Class

T. ROWE PRICE FINANCIAL SERVICES FUND, INC.

T. ROWE PRICE GLOBAL TECHNOLOGY FUND, INC.

T. ROWE PRICE GNMA FUND

T. ROWE PRICE GROWTH & INCOME FUND, INC.

T. ROWE PRICE GROWTH STOCK FUND, INC.
T. Rowe Price Growth Stock Fund--R Class

T. ROWE PRICE HEALTH SCIENCES FUND, INC.

T. ROWE PRICE HIGH YIELD FUND, INC.

T. ROWE PRICE INDEX TRUST, INC.
T. Rowe Price Equity Index 500 Fund
T. Rowe Price Extended Equity Market Index Fund
T. Rowe Price Total Equity Market Index Fund

T. ROWE PRICE INFLATION PROTECTED BOND FUND, INC.

T. ROWE PRICE INSTITUTIONAL EQUITY FUNDS, INC.
T. Rowe Price Institutional Large-Cap Core Growth Fund
T. Rowe Price Institutional Large-Cap Growth Fund
T. Rowe Price Institutional Large-Cap Value Fund
T. Rowe Price Institutional Mid-Cap Equity Growth Fund
T. Rowe Price Institutional Small-Cap Stock Fund

T. ROWE PRICE INSTITUTIONAL INCOME FUNDS, INC.
T. Rowe Price Institutional Core Plus Fund
T. Rowe Price Institutional High Yield Fund

T. ROWE PRICE INSTITUTIONAL INTERNATIONAL FUNDS, INC.
T. Rowe Price Institutional Emerging Markets Equity Fund
T. Rowe Price Institutional Foreign Equity Fund
T. Rowe Price Institutional Global Equity Fund

T. ROWE PRICE INTERNATIONAL FUNDS, INC.
T. Rowe Price Emerging Europe & Mediterranean Fund
T. Rowe Price Emerging Markets Bond Fund
T. Rowe Price Emerging Markets Stock Fund
T. Rowe Price European Stock Fund
T. Rowe Price Global Stock Fund
T. Rowe Price International Bond Fund
T. Rowe Price International Discovery Fund
T. Rowe Price International Growth & Income Fund
T. Rowe Price International Growth & Income Fund--R Class
T. Rowe Price International Stock Fund
T. Rowe Price International Stock Fund--R Class
T. Rowe Price Japan Fund
T. Rowe Price Latin America Fund
T. Rowe Price New Asia Fund

T. ROWE PRICE INTERNATIONAL INDEX FUND, INC.
T. Rowe Price International Equity Index Fund

T. ROWE PRICE MEDIA & TELECOMMUNICATIONS FUND, INC.

T. ROWE PRICE MID-CAP GROWTH FUND, INC.
T. Rowe Price Mid-Cap Growth Fund--R Class

T. ROWE PRICE MID-CAP VALUE FUND, INC.
T. Rowe Price Mid-Cap Value Fund--R Class

T. ROWE PRICE NEW AMERICA GROWTH FUND

T. ROWE PRICE NEW ERA FUND, INC.

T. ROWE PRICE NEW HORIZONS FUND, INC.

T. ROWE PRICE NEW INCOME FUND, INC.
T. Rowe Price New Income Fund--R Class

T. ROWE PRICE PERSONAL STRATEGY FUNDS, INC.
T. Rowe Price Personal Strategy Balanced Fund
T. Rowe Price Personal Strategy Growth Fund
T. Rowe Price Personal Strategy Income Fund

T. ROWE PRICE PRIME RESERVE FUND, INC.

T. ROWE PRICE REAL ESTATE FUND, INC.

T. ROWE PRICE RETIREMENT FUNDS, INC.
T. Rowe Price Retirement 2005 Fund
T. Rowe Price Retirement 2010 Fund
T. Rowe Price Retirement 2010 Fund--R Class
T. Rowe Price Retirement 2015 Fund
T. Rowe Price Retirement 2020 Fund
T. Rowe Price Retirement 2020 Fund--R Class
T. Rowe Price Retirement 2025 Fund
T. Rowe Price Retirement 2030 Fund
T. Rowe Price Retirement 2030 Fund--R Class
T. Rowe Price Retirement 2035 Fund
T. Rowe Price Retirement 2040 Fund
T. Rowe Price Retirement 2040 Fund--R Class
T. Rowe Price Retirement 2045 Fund
T. Rowe Price Retirement Income Fund
T. Rowe Price Retirement Income Fund--R Class

T. ROWE PRICE SCIENCE & TECHNOLOGY FUND, INC.

T. ROWE PRICE SHORT-TERM BOND FUND, INC.

T. ROWE PRICE SMALL-CAP STOCK FUND, INC.

T. ROWE PRICE SMALL-CAP VALUE FUND, INC.

T. ROWE PRICE SPECTRUM FUND, INC.
Spectrum Growth Fund
Spectrum Income Fund
Spectrum International Fund

T. ROWE PRICE SUMMIT FUNDS, INC.
T. Rowe Price Summit Cash Reserves Fund
T. Rowe Price Summit GNMA Fund

T. ROWE PRICE U.S. BOND INDEX FUND, INC.

T. ROWE PRICE U.S. TREASURY FUNDS, INC.
U.S. Treasury Intermediate Fund
U.S. Treasury Long-Term Fund
U.S. Treasury Money Fund

T. ROWE PRICE VALUE FUND, INC.

Attest:

/s/Patricia B. Lippert                          /s/Joseph A. Carrier
Patricia B. Lippert                     By:     Joseph A. Carrier
Secretary                                       Treasurer


Attest:                                 T. ROWE PRICE RETIREMENT PLAN
                                        SERVICES, INC.

/s/Barbara A. Van Horn                          /s/Henry H. Hopkins
Barbara A. Van Horn                     By:     Henry H. Hopkins
Secretary                                       Vice President