UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED
MANAGEMENT INVESTMENT COMPANIES
Investment Company Act file number: 811-05009
COLORADO BONDSHARES A TAX-EXEMPT FUND
(Exact name of registrant as specified in its charter)
1200 17TH STREET, SUITE 850
DENVER, COLORADO 80202-5808
(Address of principal executive offices) (Zip code)
FRED R. KELLY, JR.
1200 17TH STREET, SUITE 850
DENVER, COLORADO 80202-5808
(Name and address of agent for service)
Registrants telephone number, including area code: 303-572-6990
Date of fiscal year end: 09/30
Date of reporting period: 03/31/2018
ITEM 1. REPORT TO STOCKHOLDERS.
May 25, 2018
Dear Shareholders:
The most often asked questions we hear from shareholders are What happened with the dividend, what is happening with the dividend, and whats going to happen with the dividend? This fund has a long, established history of relatively high payouts to shareholders and this has continued since inception, despite economic fluctuations. However, we live in the fixed income world and this means that we are always in a trade off between generating income today and potentially losing principal tomorrow. To maximize earnings, we are forced to balance risk which comes in two forms.
The first is credit risk, which comes from the possibility that some of our bonds will experience difficulty paying us back on schedule. I am happy to report the amount of credit risk present in the portfolio has been reduced dramatically in the last couple of years due primarily to the refinancing of the bonds that presented the greatest risk. This process is ongoing, and we expect it to run its course in the next year or so. Less risk means less yield. The timing of this is most propitious because it positions us very well in case a new economic downturn comes about in the next couple of years.
The second type of risk is market risk which is the one you hear about most in the media. When we buy a bond, we commit to a fixed stream of income over a period of years. If todays interest rate is higher than yesterdays when we bought the bond, then that stream of income is less valuable to the holder which means the market value of the bond declines. This explains the inverse relationship between interest rates and price. To oversimplify an example, if interest rates rise by 1% and there are twenty years left to maturity, the price of the bond would go down by a little less than 20%. We rarely sell anything so we would recover the value eventually but it could theoretically take 20 years to recoup. The same bond could, at most, contribute a quarter of one percent to the annual income of the fund. One would not want to intentionally risk a 20% loss for a one quarter of one percent increase in income.
Our job is to choose from the many options available to attempt to engineer the optimum mix of holdings so as to maximize income with manageable risk to invested principal. This is not a perfect science and sometimes enough time elapses while we are shopping for the perfect fit to impair current income generation. We have long said that we would rather temporarily forego income and make it up tomorrow than risk a loss of principal today. This is just such a time when we are carrying more cash than we would, ideally, like. However, with the possible prospect of rising rates in the future a little extra cash
may come in handy. Maintaining high liquidity has had tremendous benefits for us in past years and we believe it will again.
Consider what has happened. During the Great Recession of 2008, short term investments in bonds barely offered any return. Today because of the actions of the Federal Reserve to normalize rates it is possible to earn a respectable yield without having to unduly extend maturities. Our average maturity, as adjusted by expected calls (duration), remains relatively short at 5.95 years, at period ended March 31, 2018. On the supply side however, the issuers are seeking to lock in low interest rates for the longest term possible. We applaud the issuers for establishing long term sources of capital which is positive for their long-term health and vitality. But we do not believe it to be in your best interest as shareholders to be locked in to a long-term investment without upside. We would rather they do it with someone elses money, not yours. Instead, we will when advisable defer making those commitments to a time when the advantage is more on our side of the equation. This is an opportunity to exercise discipline and perhaps leave the party a little early. We are confident that our approach will be the soundest in the long run but it will likely result in occasions when the dividend is temporarily below expectations. Just remember when that happens as it has in the last three months that we are not in any way changing our logic or approach but rather, in other words, its an anomaly, not the new norm. Simply put, that means stay tuned, folks we are working tirelessly to increase the income. For a detailed financial review of the six-month period, ended March 31, 2018, please see the attached semi-annual report.
Thank you for your interest and your questions. We truly appreciate your patronage.
Sincerely,
Fred R. Kelly, Jr.
Portfolio Manager
Officers and Trustees
George N. Donnelly, Chairman of the Board of Trustees, Interim President, Secretary, Treasurer and Trustee
Bruce G. Ely, Trustee
James R. Madden, Trustee
Fred R. Kelly, Jr., Portfolio Manager
Investment Adviser
Freedom Funds Management Company
Transfer, Shareholder Servicing, and Dividend Disbursing Agent
Freedom Funds Management Company
Distributor
Colorado Financial Service Corporation
Custodian of Portfolio Securities
UMB Bank, N.A.
Independent Registered Public Accounting Firm
EKS&H LLLP
Special Legal Counsel
Kutak Rock LLP
This report is submitted for the general information of the shareholders of Colorado BondShares A Tax-Exempt Fund. This report must be preceded or accompanied by a Prospectus of the Fund. The prospectus contains information concerning the investment policies and expenses of the portfolio in addition to other pertinent information. Shares of Colorado BondShares A Tax-Exempt Fund are not deposits or obligations of any bank, are not guaranteed by any bank, are not insured by the FDIC or any other agency, and involve investment risks, including possible loss of the principal amount invested.
Officers and Trustees of the Fund (unaudited)
The following table lists the trustees and officers of the Fund, together with their address, age, positions held with the Fund, the term of each office held and the length of time served in each office, principal business occupations during the past five years and other directorships, if any, held by each trustee and officer. Each trustee and officer has served in that capacity for the Fund continuously since originally elected or appointed. The Board supervises the business activities of the Fund. Each trustee serves as a trustee until termination of the Fund unless the Trustee dies, resigns, retires, or is removed. The Funds Statement of Additional Information includes more information about the trustees. Shareholders may call (800) 572-0069 to request a free copy.
Name, Address and Age |
Position held with |
Principal Occupation |
Other Directorships | |||
Non-Interested Trustees | ||||||
Bruce G. Ely 1200 17th Street, Suite 850 Denver CO 80202 Age: 67 |
Trustee since July 2002 | Mr. Ely was a Regional Director for Cutwater Asset Management, a wholly owned subsidiary of MBIA, Inc. until his retirement in September 2013. | None | |||
James R. Madden 1200 17th Street, Suite 850 Denver CO 80202 Age: 74 |
Trustee since September 2004 | Mr. Madden has owned Madden Enterprises, a real estate company that owns and leases commercial buildings and real estate, for the past thirty years. He is also a stockholder and director of The Community Bank in western Kansas. He has been a bank director for 25 years. | None | |||
Interested Trustees* | ||||||
George N. Donnelly 1200 17th Street, Suite 850 Denver CO 80202 Age: 71 |
Chairman of the Board of Trustees, Trustee since inception of the Fund in 1987 and Interim President, Secretary and Treasurer of the Fund since September 26, 2008 | Mr. Donnelly was a Senior Regional Vice President for Phoenix Life Insurance Company until his retirement in January 2010. | None |
*George N. Donnelly is an interested person of the Fund as defined in the Investment Company Act of 1940 (the 1940 Act) by virtue of his position as both an officer and a trustee of the Fund as described in the table above. None of the trustees nor the officers of the Fund have any positions with the Investment Adviser, the principal underwriter of the Fund, the distribution agent of the Fund, the service agent of the Fund or the custodian of the Fund, or any affiliates thereof. There is no family relationship between any officers and trustees of the Fund.
1
FUND EXPENSES (unaudited)
The following examples are intended to help you understand the ongoing costs (in dollars) of investing in the Fund and compare these costs with those of other mutual funds. The examples (actual and hypothetical 5% return) are based on an investment of $1,000 made at the beginning of the period shown and held for the entire period.
As a shareholder of Colorado BondShares A Tax-Exempt Fund (the Fund) you can incur two types of costs:
| Sales charges (front loads) on fund purchases and |
| Ongoing fund costs, including management fees, administrative services, and other fund expenses. All mutual funds have operating expenses. Operating expenses, which are deducted from the Funds gross income, directly reduce the investment return of the Fund. |
Actual Fund Expenses
The first line of the table below provides information about actual account values and actual expenses. You may use the information in this line, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = 8.6), then multiply the result by the number in the first line under the heading entitled Expenses Paid During Period to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The second line of the table below provides information about hypothetical account values and hypothetical expenses based on the Funds actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing cost of investing in the Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in shareholder reports of other funds.
Six Months Ended March 31, 2018
Colorado BondShares A Tax- Exempt Fund |
Beginning Account Value 10/01/17 |
Ending Account Value 03/31/18 |
Expenses Paid During Period(1) | ||||||||||||
Based on Actual Fund Return |
$ | 1,000.00 | $ | 1,025.38 | $ | 2.83 | |||||||||
Based on Hypothetical 5% Annual Return Before Expenses |
$ | 1,000.00 | $ | 1,022.20 | $ | 2.83 |
(1) | The expenses shown in this table are equal to the Funds annualized expense ratio of 0.56% for semi-annual year ended March 31, 2018, multiplied by the average account value over the period, multiplied by 182/365 to reflect the one-half year period. |
Please note that expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads), redemption fees or exchange fees. Therefore, the second line of the table is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if transactional costs were included, your costs would have been higher. You can find more information about the Funds expenses in the Financial Statements section of this report. For additional information on operating costs, please see the Funds prospectus.
2
CREDIT QUALITY (unaudited)
Colorado BondShares A Tax-Exempt Fund
Based on a Percentage of Total Net Assets as of March 31, 2018
SECTOR BREAKDOWN (unaudited)
Colorado BondShares A Tax-Exempt Fund
Based on a Percentage of Total Net Assets as of March 31, 2018
* Cash & equivalents include cash and receivables less liabilities.
** Short-term investments include securities with a maturity date or redemption feature of one year or less, as identified in the Schedule of Investments.
3
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments
March 31, 2018 (unaudited)
Colorado Municipal Bonds 48.9% | Maturity |
Coupon |
Principal |
Value |
||||||||||||||
Colorado 100.0% | ||||||||||||||||||
ABERDEEN METROPOLITAN DISTRICT #1 |
12/1/2035 | 7.50 | % | $ | 1,600,000 | $ | 476,512 | |||||||||||
ANTHOLOGY WEST METROPOLITAN |
12/15/2037 | 6.00 | % | 6,440,000 | 6,367,099 | |||||||||||||
ARISTA METROPOLITAN DISTRICT |
12/1/2037 | 9.25 | % | 26,000,000 | 15,320,500 | |||||||||||||
BANNING LEWIS RANCH METROPOLITAN DISTRICT #3 SENIOR 2015A |
12/1/2045 | 6.13 | % | 1,775,000 | 1,716,354 | |||||||||||||
BOULDER COUNTY BOULDER COLLEGE OF |
10/15/2031 | 0.00 | % | 4,315,000 | 4,315,000 | |||||||||||||
BRAMMING FARM METROPOLITAN |
12/1/2044 | 6.00 | % | 2,025,000 | 2,056,246 | |||||||||||||
BRENNAN METROPOLITAN DISTRICT SUBORDINATE 2016B(g) |
12/15/2046 | 7.50 | % | 516,000 | 509,328 | |||||||||||||
BRENNAN METROPOLITIAN DISTRICT SENIOR 2016A |
12/1/2046 | 5.25 | % | 1,185,000 | 1,231,440 | |||||||||||||
BRIGHTON CROSSING METROPOLITAN DISTRICT #4 |
12/1/2023 | 7.00 | % | 8,000,000 | 8,104,000 | |||||||||||||
BRIGHTON CROSSING METROPOLITAN DISTRICT #4 SENIOR 2017A |
12/1/2037 | 5.00 | % | 525,000 | 539,763 | |||||||||||||
BRIGHTON CROSSING METROPOLITAN DISTRICT #4 SUBORDINATE 2017B(g) |
12/1/2047 | 7.00 | % | 670,000 | 659,025 | |||||||||||||
BROMLEY PARK METROPOLITAN DISTRICT #2 |
12/15/2037 | 7.00 | % | 11,175,000 | 11,178,353 | |||||||||||||
CASTLE OAKS METROPOLITAN DISTRICT #3 |
12/1/2044 | 6.25 | % | 2,860,000 | 3,267,722 | |||||||||||||
CASTLE OAKS METROPOLITAN DISTRICT #3 SERIES 2016 |
12/1/2045 | 5.50 | % | 2,345,000 | 2,633,834 | |||||||||||||
CASTLE OAKS METROPOLITAN DISTRICT #3 SERIES 2017 |
12/1/2037 | 5.00 | % | 3,275,000 | 3,295,600 | |||||||||||||
CECFA ABILITIES CONNECTION CHARTER SCHOOL |
4/1/2019 | 5.85 | % | 31,330,000 | 31,449,054 | |||||||||||||
CECFA ADDENBROOKE CLASSICAL ACADEMY CHARTER SCHOOL |
6/1/2021 | 4.50 | % | 18,045,000 | 17,902,625 | |||||||||||||
CECFA AMERICAN ACADEMY CHARTER SCHOOL |
12/1/2025 | 4.20 | % | 37,355,000 | 37,558,958 | |||||||||||||
CECFA AMERICAN ACADEMY CHARTER SCHOOL |
12/1/2026 | 4.05 | % | 27,570,000 | 26,533,644 | |||||||||||||
CECFA APEX CMNTY CHARTER SCHOOL |
7/1/2022 | 5.25 | % | 11,635,000 | 11,564,259 | |||||||||||||
CECFA MONARCH MONTESSORI CHARTER SCHOOL |
5/15/2020 | 5.50 | % | 8,620,000 | 8,620,690 |
4
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Colorado Municipal Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||
Colorado (Continued) | ||||||||||||||||||
CECFA PROSPECT RIDGE ACADEMY CHARTER SCHOOL |
3/15/2023 | 4.85 | % | $ | 21,330,000 | $ | 21,227,616 | |||||||||||
CECFA PROSPECT RIDGE ACADEMY CHARTER SCHOOL |
3/15/2023 | 5.00 | % | 13,500,000 | 13,512,015 | |||||||||||||
CECFA STARGATE CHARTER SCHOOL |
12/1/2020 | 5.40 | % | 41,380,000 | 41,376,690 | |||||||||||||
CECFA SWALLOW ACADEMY CHARTER SCHOOL |
11/15/2027 | 5.35 | % | 3,515,000 | 3,516,230 | |||||||||||||
CECFA THOMAS MACLAREN CHARTER SCHOOL |
6/1/2024 | 5.00 | % | 15,350,000 | 15,220,753 | |||||||||||||
CECFA UNION COLONY CHARTER SCHOOL |
12/1/2037 | 5.75 | % | 3,680,000 | 3,680,846 | |||||||||||||
CECFA UNION COLONY ELEMENTARY CHARTER SCHOOL |
3/1/2020 | 5.30 | % | 6,900,000 | 6,901,449 | |||||||||||||
CECFA UNIVERSITY LAB CHARTER SCHOOL #6 |
12/15/2019 | 2.50 | % | 500,000 | 501,235 | |||||||||||||
COLLIERS HILL METROPOLITAN DISTRICT #2 SUBORDINATE 2017B(g) |
12/15/2047 | 8.50 | % | 3,501,000 | 3,340,724 | |||||||||||||
COLORADO CENTRE METROPOLITAN DISTRICT SERIES 1992 I/O(f)(i)(j) |
1/1/2027 | 9.00 | % | 2,015,949 | 1,612,759 | |||||||||||||
COLORADO CENTRE METROPOLITAN DISTRICT SERIES 1992 P/O(e)(i) |
1/1/2027 | 0.00 | % | 2,016,986 | 1,603,625 | |||||||||||||
COLORADO CENTRE METROPOLITAN DISTRICT SERIES B(g)(i)(j) |
1/1/2032 | 0.00 | % | 6,490,174 | 3,407,341 | |||||||||||||
COLORADO CROSSING METROPOLITAN DISTRICT #2 |
12/1/2047 | 7.50 | % | 7,391,000 | 7,386,491 | |||||||||||||
COLORADO HOUSING & FINANCE |
12/1/2013 | 0.00 | % | 3,755,000 | 3,755,000 | |||||||||||||
COLORADO INTERNATIONAL CENTER METROPOLITAN DISTRICT #3 |
12/1/2031 | 4.63 | % | 635,000 | 606,146 | |||||||||||||
COLORADO SPRINGS URBAN RENEWAL AUTHORITY |
12/15/2030 | 6.75 | % | 2,224,000 | 2,101,257 | |||||||||||||
CONIFER METROPOLITAN DISTRICT(a) |
12/1/2033 | 0.00 | % | 1,550,000 | 620,000 | |||||||||||||
CONIFER METROPOLITAN DISTRICT(a) |
12/1/2032 | 0.00 | % | 1,450,000 | 580,000 | |||||||||||||
CONIFER METROPOLITAN DISTRICT(a) |
12/1/2030 | 0.00 | % | 10,000,000 | 4,000,000 | |||||||||||||
COPPERLEAF METROPOLITAN DISTRICT #3 |
12/1/2037 | 5.00 | % | 500,000 | 492,585 | |||||||||||||
COUNTRY CLUB HIGHLANDS METROPOLITAN DISTRICT |
12/1/2037 | 7.25 | % | 1,030,000 | 875,500 | |||||||||||||
CUCHARES RANCH METROPOLITAN DISTRICT |
12/1/2045 | 5.00 | % | 2,100,000 | 2,093,616 | |||||||||||||
DENVER WEST PROMENADE METROPOLITAN DISTRICT |
12/1/2031 | 5.13 | % | 500,000 | 505,270 |
5
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Colorado Municipal Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||
Colorado (Continued) | ||||||||||||||||||
DENVER WEST PROMENADE METROPOLITAN DISTRICT |
12/15/2046 | 6.00 | % | $ | 500,000 | $ | 456,265 | |||||||||||
ELBERT & HWY 86 COML METROPOLITAN DISTRICT |
12/1/2032 | 7.50 | % | 4,500,000 | 2,745,000 | |||||||||||||
ERIE FARM METROPOLITAN DISTRICT SERIES 2016A |
12/1/2045 | 5.50 | % | 2,000,000 | 2,033,260 | |||||||||||||
ERIE HIGHLANDS METROPOLITAN DISTRICT #1 SENIOR 2015A |
12/1/2045 | 5.75 | % | 2,620,000 | 2,662,732 | |||||||||||||
ERIE HIGHLANDS METROPOLITAN DISTRICT #1 SUBORDINATE 2015B |
12/15/2045 | 7.75 | % | 708,000 | 707,887 | |||||||||||||
FLATIRON MEADOWS METROPOLITAN DISTRICT |
12/1/2046 | 5.13 | % | 2,000,000 | 1,960,120 | |||||||||||||
FOREST TRACE METROPOLITAN DISTRICT #3 SUBORDINATE 2016B(g) |
12/15/2046 | 7.25 | % | 683,000 | 634,951 | |||||||||||||
FORT LUPTON GOLF COURSE(a) |
12/15/2037 | 0.00 | % | 620,000 | 15,500 | |||||||||||||
FRONTERRA VLG METROPOLITAN DISTRICT #2 |
12/1/2034 | 5.00 | % | 3,685,000 | 3,686,743 | |||||||||||||
GRANBY RANCH METROPOLITAN DISTRICT |
12/1/2036 | 6.75 | % | 2,000,000 | 1,989,260 | |||||||||||||
GREAT WESTERN PARK METROPOLITAN DISTRICT #2 SENIOR 2016A |
12/1/2026 | 4.00 | % | 585,000 | 572,393 | |||||||||||||
GREAT WESTERN PARK METROPOLITAN DISTRICT #2 SUBORDINATE 2016B |
12/15/2046 | 7.25 | % | 775,000 | 741,512 | |||||||||||||
GREEN GABLES METROPOLITAN DISTRICT #1 SENIOR 2016A |
12/1/2046 | 5.30 | % | 1,250,000 | 1,258,963 | |||||||||||||
GREEN GABLES METROPOLITAN DISTRICT #1 SUBORDINATE 2016B(g) |
12/15/2046 | 7.75 | % | 740,000 | 741,813 | |||||||||||||
HIGHLANDS METROPOLITAN DISTRICT #2 SENIOR 2016A |
12/1/2046 | 5.13 | % | 1,960,000 | 1,992,477 | |||||||||||||
HIGHLANDS METROPOLITAN DISTRICT #2 SUBORDINATE 2016B |
12/15/2046 | 7.50 | % | 1,269,000 | 1,270,104 | |||||||||||||
HYLAND VILLAGE METROPOLITAN DISTRICT |
12/1/2027 | 7.25 | % | 4,293,000 | 1,674,270 | |||||||||||||
JEFFCO BUSINESS CENTER METROPOLITAN DISTRICT #1(j) |
5/1/2020 | 8.00 | % | 1,006,000 | 905,400 | |||||||||||||
JEFFERSON CENTER METROPOLITAN DISTRICT #1 |
12/1/2026 | 4.75 | % | 2,269,000 | 2,283,022 | |||||||||||||
LEWIS POINTE METROPOLITAN DISTRICT JUNIOR LIEN 2017C(g) |
12/15/2047 | 9.00 | % | 536,000 | 332,368 | |||||||||||||
LEWIS POINTE METROPOLITAN DISTRICT SENIOR 2015A |
12/1/2044 | 6.00 | % | 2,590,000 | 2,606,162 |
6
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Colorado Municipal Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||
Colorado (Continued) | ||||||||||||||||||
LEYDEN ROCK METROPOLITAN DISTRICT SENIOR 2016A |
12/1/2033 | 4.38 | % | $ | 905,000 | $ | 902,412 | |||||||||||
LEYDEN ROCK METROPOLITAN DISTRICT SENIOR 2016A |
12/1/2025 | 4.00 | % | 500,000 | 508,375 | |||||||||||||
LEYDEN ROCK METROPOLITAN DISTRICT SENIOR 2016A |
12/1/2045 | 5.00 | % | 1,525,000 | 1,552,557 | |||||||||||||
LEYDEN ROCK METROPOLITAN DISTRICT SUBORDINATE 2016B(g) |
12/15/2045 | 7.25 | % | 1,195,000 | 1,176,239 | |||||||||||||
LEYDEN ROCK METROPOLITAN DISTRICT #10 JUNIOR LIEN 2017C(g) |
12/15/2049 | 10.75 | % | 1,025,000 | 1,010,261 | |||||||||||||
LITTLETON VILLAGE METROPOLITAN |
12/1/2045 | 5.38 | % | 1,700,000 | 1,706,868 | |||||||||||||
MARIN METROPOLITAN DISTRICT(a)(j) |
12/1/2028 | 0.00 | % | 17,485,000 | 3,000,076 | |||||||||||||
MARVELLA METROPOLITAN DISTRICT SENIOR 2016A |
12/1/2046 | 5.13 | % | 1,405,000 | 1,452,517 | |||||||||||||
MEADOWS METROPOLITAN DISTRICT #1(k) |
6/1/2029 | 8.00 | % | 11,580,000 | 11,877,259 | |||||||||||||
MEADOWS METROPOLITAN DISTRICT #2(k) |
6/1/2029 | 8.00 | % | 11,565,000 | 11,861,874 | |||||||||||||
MEADOWS METROPOLITAN DISTRICT #7(k) |
6/1/2029 | 8.00 | % | 11,515,000 | 11,810,590 | |||||||||||||
MIDCITIES METROPOLITAN DISTRICT #2 SUBORDINATE 2016B(g) |
12/15/2046 | 7.75 | % | 1,945,000 | 1,934,983 | |||||||||||||
MOUNT CARBON METROPOLITAN DISTRICT SERIES 2004A(g) |
6/1/2043 | 7.00 | % | 237,916 | 214,125 | |||||||||||||
MOUNT CARBON METROPOLITAN DISTRICT SERIES 2004B(g) |
6/1/2043 | 7.00 | % | 1,830,000 | 1,647,000 | |||||||||||||
MOUNT CARBON METROPOLITAN DISTRICT SERIES 2004C(e) |
6/1/2043 | 0.00 | % | 565,000 | 124,300 | |||||||||||||
MOUNTAIN SHADOWS METROPOLITAN DISTRICT SUBORDINATE 2016B(g) |
12/15/2046 | 7.50 | % | 1,800,000 | 1,807,308 | |||||||||||||
MOUNTAIN SHADOWS METROPOLITAN DISTRICT SUBORDINATE 2018C-1(g) |
12/15/2040 | 10.00 | % | 1,994,000 | 1,994,000 | |||||||||||||
MURPHY CREEK METROPOLITAN DISTRICT #3 |
12/1/2035 | 6.13 | % | 1,880,000 | 1,269,000 | |||||||||||||
MURPHY CREEK METROPOLITAN DISTRICT #3 |
12/1/2026 | 6.00 | % | 2,540,000 | 1,714,500 | |||||||||||||
NEU TOWNE METROPOLITAN DISTRICT |
12/1/2023 | 7.20 | % | 1,500,000 | 900,000 | |||||||||||||
NORTH PINE VISTAS METROPOLITAN DISTRICT #2 SENIOR 2016A |
12/1/2046 | 6.75 | % | 6,735,000 | 6,784,570 | |||||||||||||
NORTH PINE VISTAS METROPOLITAN DISTRICT #2 SUBORDINATE 2016B(g) |
12/15/2046 | 8.50 | % | 1,810,000 | 1,822,417 |
7
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Colorado Municipal Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||
Colorado (Continued) | ||||||||||||||||||
NORTH PINE VISTAS METROPOLITAN DISTRICT #3 SENIOR 2016A |
12/1/2036 | 6.00 | % | $ | 4,345,000 | $ | 4,372,982 | |||||||||||
NORTH PINE VISTAS METROPOLITAN DISTRICT #3 SUBORDINATE 2016B(g) |
12/15/2046 | 8.25 | % | 1,203,000 | 1,210,110 | |||||||||||||
OVERLOOK METROPOLITAN DISTRICT SENIOR 2016A |
12/1/2046 | 5.50 | % | 1,500,000 | 1,449,540 | |||||||||||||
PALISADE METROPOLITAN DISTRICT #2 |
12/1/2031 | 4.38 | % | 2,650,000 | 2,589,872 | |||||||||||||
PALISADE PARK NORTH METROPOLITAN DISTRICT #1 SENIOR 2016A |
12/1/2046 | 5.88 | % | 2,075,000 | 1,955,854 | |||||||||||||
PALISADE PARK NORTH METROPOLITAN DISTRICT #1 SUBORDINATE 2016B |
12/15/2046 | 8.00 | % | 525,000 | 500,619 | |||||||||||||
PARKER AUTOMOTIVE METROPOLITAN DISTRICT |
12/1/2045 | 5.00 | % | 2,088,000 | 1,962,908 | |||||||||||||
PIONEER METROPOLITAN DISTRICT #3(g) |
12/1/2046 | 6.50 | % | 5,236,000 | 4,846,756 | |||||||||||||
POTOMAC FARMS METROPOLITAN DISTRICT SERIES 2007A |
12/1/2037 | 7.25 | % | 2,340,000 | 2,216,776 | |||||||||||||
POTOMAC FARMS METROPOLITAN DISTRICT SERIES 2007B |
12/1/2023 | 7.63 | % | 311,000 | 295,574 | |||||||||||||
PROMENADE AT CASTLE ROCK METROPOLITAN DISTRICT #1 SERIES A |
12/1/2025 | 5.13 | % | 1,040,000 | 1,107,673 | |||||||||||||
PUBLIC FINANCE AUTHORITY COLO EARLY COLLEGES CHARTER SCHOOL SERIES 2016A |
7/1/2023 | 4.25 | % | 34,320,000 | 33,889,627 | |||||||||||||
PUBLIC FINANCE AUTHORITY WEST RIDGE ACADEMY CHARTER SCHOOL SERIES 2017A |
12/1/2021 | 5.50 | % | 9,345,000 | 9,357,709 | |||||||||||||
RAVENNA METROPOLITAN DISTRICT CONV CABS SUBORDINATE SERIES 2017B(j) |
12/15/2026 | 7.50 | % | 8,000,000 | 8,000,000 | |||||||||||||
REX RANCH METROPOLITAN DISTRICT SUBORDINATE 2018B(g) |
12/15/2047 | 7.88 | % | 445,000 | 445,000 | |||||||||||||
RICHARDS FARM METROPOLITAN DISTRICT #2 SENIOR SERIES 2015A |
12/1/2045 | 5.75 | % | 1,400,000 | 1,344,700 | |||||||||||||
RIVERDALE PEAKS II METROPOLITAN DISTRICT |
12/1/2035 | 6.50 | % | 1,135,000 | 295,100 | |||||||||||||
RIVERDALE PEAKS II METROPOLITAN DISTRICT |
12/1/2025 | 6.40 | % | 930,000 | 241,800 | |||||||||||||
ROUTT CNTY LID SERIES 2004A |
8/1/2024 | 6.50 | % | 363,000 | 364,405 | |||||||||||||
ROXBOROUGH VILLAGE METROPOLITAN DISTRICT SERIES 1993B I/O(f)(i)(j) |
12/31/2042 | 0.00 | % | 242,645 | 21,838 |
8
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Colorado Municipal Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||
Colorado (Continued) | ||||||||||||||||||
ROXBOROUGH VILLAGE METROPOLITAN DISTRICT SERIES 1993B P/O(e)(i)(j) |
12/31/2021 | 0.00 | % | $ | 169,939 | $ | 97,800 | |||||||||||
SIERRA RIDGE METROPOLITAN DISTRICT #2 SENIOR SERIES 2016A |
12/1/2031 | 4.50 | % | 1,000,000 | 983,910 | |||||||||||||
SIERRA RIDGE METROPOLITAN DISTRICT #2 SUBORDINATE SERIES 2016B(g) |
12/15/2046 | 7.63 | % | 1,500,000 | 1,471,860 | |||||||||||||
SILVER PEAKS METROPOLITAN DISTRICT #2 |
12/1/2036 | 5.75 | % | 500,000 | 452,245 | |||||||||||||
SOLARIS METROPOLITIAN DISTRICT #3 SUBORDINATE SERIES 2016B(g) |
12/15/2046 | 7.00 | % | 1,000,000 | 987,380 | |||||||||||||
SOLITUDE METROPOLITAN DISTRICT(j) |
12/1/2026 | 7.00 | % | 3,520,000 | 2,745,600 | |||||||||||||
SORREL RANCH METROPOLITAN DISTRICT |
12/1/2036 | 5.75 | % | 5,977,000 | 5,364,955 | |||||||||||||
SOUTHGLENN METROPOLITAN DISTRICT |
12/1/2021 | 3.00 | % | 1,433,000 | 1,425,348 | |||||||||||||
SOUTHSHORE METROPOLITAN DISTRICT #2 CONV CABS(d) |
12/1/2042 | 6.50 | % | 7,205,000 | 7,160,401 | |||||||||||||
SOUTHSHORE METROPOLITAN DISTRICT #2 SUBORDINATE SERIES 2017(g) |
12/15/2042 | 7.75 | % | 5,202,000 | 5,181,920 | |||||||||||||
ST VRAIN LAKES METROPOLITAN DISTRICT #2 SENIOR SERIES 2017A |
12/1/2037 | 5.00 | % | 1,500,000 | 1,503,735 | |||||||||||||
ST VRAIN LAKES METROPOLITAN DISTRICT #2 SUBORDINATE SERIES 2017B(g) |
12/15/2047 | 7.63 | % | 1,083,000 | 1,060,084 | |||||||||||||
STC METROPOLITAN DISTRICT #2 SENIOR SERIES 2015A |
12/1/2038 | 6.00 | % | 1,000,000 | 1,030,150 | |||||||||||||
STC METROPOLITAN DISTRICT #2 SUBORDINATE SERIES 2015B(g) |
12/15/2038 | 7.75 | % | 3,500,000 | 3,548,055 | |||||||||||||
STERLING RANCH COMMUNITY AUTHORITY BOARD SENIOR SERIES 2015A |
12/1/2035 | 5.50 | % | 2,195,000 | 2,239,690 | |||||||||||||
STERLING RANCH COMMUNITY AUTHORITY BOARD SENIOR SERIES 2015A |
12/1/2045 | 5.75 | % | 3,000,000 | 3,067,950 | |||||||||||||
STERLING RANCH COMMUNITY AUTHORITY BOARD SUBORDINATE SERIES 2015B(g) |
12/15/2045 | 7.75 | % | 1,045,000 | 1,055,795 | |||||||||||||
STONE RIDGE METROPOLITAN DISTRICT #2 |
12/1/2031 | 0.00 | % | 11,896,000 | 1,903,360 | |||||||||||||
TABLE MOUNTAIN METROPOLITAN DISTRICT SENIOR SERIES 2016A |
12/1/2045 | 5.25 | % | 1,615,000 | 1,683,944 | |||||||||||||
TABLE MOUNTAIN METROPOLITAN DISTRICT SUBORDINATE SERIES 2016B(g) |
12/15/2045 | 7.75 | % | 570,000 | 587,396 | |||||||||||||
TALLYNS REACH METROPOLITAN DISTRICT #3 |
11/1/2038 | 5.13 | % | 2,070,000 | 2,190,039 |
9
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Colorado Municipal Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||||
Colorado (Continued) | ||||||||||||||||||||
TALLYNS REACH METROPOLITIAN DISTRICT #3 SUBORDINATE SERIES 2016A(g) |
|
11/1/2038 | 6.75 | % | $ | 1,220,000 | $ | 1,221,244 | ||||||||||||
THE PLAZA METROPOLITAN DISTRICT #1 |
|
12/1/2040 | 5.00 | % | 5,350,000 | 5,531,472 | ||||||||||||||
UNITED W & S EAST CHERRY CREEK(c) |
|
11/15/2023 | 5.00 | % | 4,949,000 | 4,952,167 | ||||||||||||||
UNITED WATER & SAN DISTRICT ELBERT COUNTY(g) |
|
12/1/2023 | 6.00 | % | 5,342,000 | 5,307,491 | ||||||||||||||
UNITED WATER & SAN DISTRICT LUPTON LAKES |
|
3/1/2021 | 6.00 | % | 7,775,000 | 7,775,389 | ||||||||||||||
VALAGUA METROPOLITAN DISTRICT |
|
12/1/2037 | 7.75 | % | 11,500,000 | 2,300,000 | ||||||||||||||
VDW METROPOLITAN DISTRICT #2 SUBORDINATE SERIES 2016B(g) |
|
12/15/2045 | 7.25 | % | 1,934,000 | 1,859,850 | ||||||||||||||
VILLAS EASTLAKE RESERVOIR METROPOLITAN DISTRICT SUBORDINATE SERIES 2016B(g) |
|
12/15/2046 | 8.00 | % | 355,000 | 360,243 | ||||||||||||||
WESTOWN METROPOLITAN DISTRICT SENIOR SERIES 2017A |
|
12/1/2047 | 5.00 | % | 1,400,000 | 1,380,806 | ||||||||||||||
WHISPERING PINES METROPOLITAN DISTRICT #1 SENIOR SERIES 2017A |
|
12/1/2037 | 5.00 | % | 1,000,000 | 1,011,350 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado (amortized cost $609,099,052) |
|
655,700,609 | 586,469,057 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado Municipal Bonds |
|
$ | 655,700,609 | $ | 586,469,057 | |||||||||||||||
|
|
|
|
|||||||||||||||||
Short-Term Municipal Bonds 14.7% | ||||||||||||||||||||
Multi-State 79.6% |
||||||||||||||||||||
FREDDIE MAC VR (LOC 6) |
|
12/15/2045 | 1.66 | % | $ | 18,930,000 | $ | 18,930,000 | ||||||||||||
FREDDIE MAC VR (LOC 6) |
|
3/15/2049 | 1.66 | % | 35,060,000 | 35,060,000 | ||||||||||||||
FREDDIE MAC VR AMT (LOC 6) |
|
6/15/2036 | 1.68 | % | 27,655,000 | 27,655,000 | ||||||||||||||
FREDDIE MAC VR AMT TAX (LOC 6) |
|
5/15/2046 | 1.64 | % | 38,800,000 | 38,800,000 | ||||||||||||||
FREDDIE MAC VR AMT TAX (LOC 6) |
|
7/15/2050 | 1.64 | % | 9,730,000 | 9,730,000 | ||||||||||||||
SUNAMERICA TRUST CLASS A SERIES 2001-2 AMT TAX (LOC 6) |
|
7/1/2041 | 1.64 | % | 10,400,000 | 10,400,000 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Multi-State (amortized cost $140,575,000) |
|
140,575,000 | 140,575,000 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado 20.4% |
||||||||||||||||||||
BROOMFIELD URBAN RENEWAL AUTHORITY (LOC 1) |
|
12/1/2030 | 1.68 | % | 9,745,000 | 9,745,000 | ||||||||||||||
COLORADO HOUSING & FINANCE AUTHORITY SERIES 2007A (LOC 3) |
|
1/1/2032 | 1.65 | % | 2,800,000 | 2,800,000 |
10
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Short-Term Municipal Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||||
Colorado (Continued) | ||||||||||||||||||||
COLORADO HOUSING & FINANCE AUTHORITY (LOC 2) |
|
10/1/2038 | 1.52 | % | $ | 3,410,000 | $ | 3,410,000 | ||||||||||||
COLORADO HOUSING & FINANCE AUTHORITY (LOC 2) |
|
11/1/2034 | 1.52 | % | 1,090,000 | 1,090,000 | ||||||||||||||
COLORADO HOUSING & FINANCE AUTHORITY (LOC 4) |
|
11/1/2036 | 1.59 | % | 11,145,000 | 11,145,000 | ||||||||||||||
COLORADO SPRINGS UTILITIES (LOC 3) |
|
11/1/2041 | 1.62 | % | 1,300,000 | 1,300,000 | ||||||||||||||
LAFAYETTE CITY CTR GENERAL IMPROVEMENT DISTRICT |
|
12/1/2018 | 5.75 | % | 70,000 | 70,264 | ||||||||||||||
SHERIDAN REDEVLOPMENT AGENCY SERIES 2011A-1 (LOC 5) |
|
12/1/2029 | 1.65 | % | 6,400,000 | 6,400,000 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado (amortized cost $35,952,672) |
|
35,960,000 | 35,960,264 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Short-Term Municipal Bonds |
|
$ | 176,535,000 | $ | 176,535,264 | |||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado Capital Appreciation and Zero Coupon Bonds 5.1% | ||||||||||||||||||||
Colorado 100.0% |
||||||||||||||||||||
COLORADO HEALTH FACILITIES |
|
7/15/2020 | 0.00 | % | $ | 520,000 | $ | 496,116 | ||||||||||||
CONIFER METROPOLITAN DISTRICT(a)(d)(j) |
|
12/1/2031 | 0.00 | % | 7,470,000 | 3,352,312 | ||||||||||||||
FLYINGHORSE METROPOLITAN |
|
12/15/2042 | 8.00 | % | 15,725,000 | 13,868,192 | ||||||||||||||
PV WATER & SAN METROPOLITAN |
|
12/15/2037 | 0.00 | % | 14,000,000 | 2,940,000 | ||||||||||||||
RAVENNA METROPOLITAN DISTRICT CONV CABS SERIES 2017 SUPPLEMENTAL B(j) |
|
12/1/2024 | 0.00 | % | 490,000 | 346,072 | ||||||||||||||
RAVENNA METROPOLITAN DISTRICT CONV CABS SERIES 2017 SUPPLEMENTAL B(j) |
|
12/1/2023 | 0.00 | % | 325,000 | 241,157 | ||||||||||||||
RAVENNA METROPOLITAN DISTRICT CONV CABS SERIES 2017 SUPPLEMENTAL B(j) |
|
12/1/2022 | 0.00 | % | 170,000 | 132,530 | ||||||||||||||
RAVENNA METROPOLITAN DISTRICT CONV CABS SERIES 2017 SUPPLEMENTAL B(j) |
|
12/1/2021 | 0.00 | % | 15,000 | 12,286 | ||||||||||||||
RAVENNA METROPOLITAN DISTRICT CONV CABS SERIES 2017 SUPPLEMENTAL B(d)(j) |
|
12/1/2025 | 0.00 | % | 585,000 | 393,260 | ||||||||||||||
RAVENNA METROPOLITAN DISTRICT CONV CABS SERIES 2017A(d)(j) |
|
12/1/2046 | 0.00 | % | 33,685,000 | 31,995,697 |
11
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Colorado Capital Appreciation and Zero Coupon Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||||
Colorado (Continued) | ||||||||||||||||||||
STERLING RANCH METROPOLITAN DISTRICT #2 CONV CAB(d) |
|
12/1/2045 | 0.00 | % | $ | 6,685,000 | $ | 5,318,853 | ||||||||||||
WILDWING METROPOLITAN DISTRICT #1(d) |
|
12/1/2023 | 0.00 | % | 2,435,000 | 1,605,517 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado (amortized cost $70,719,244) |
|
82,105,000 | 60,701,993 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado Capital Appreciation And Zero Coupon Bonds (amortized cost $70,719,244) |
|
$ | 82,105,000 | $ | 60,701,993 | |||||||||||||||
|
|
|
|
|||||||||||||||||
Other Municipal Bonds 4.3% | ||||||||||||||||||||
South Dakota 34.4% |
||||||||||||||||||||
FLANDREAU SANTEE SIOUX TRIBE |
|
1/1/2036 | 5.75 | % | $ | 6,055,000 | $ | 5,508,900 | ||||||||||||
FLANDREAU SANTEE SIOUX TRIBE |
|
1/1/2031 | 5.50 | % | 3,565,000 | 3,276,092 | ||||||||||||||
FLANDREAU SANTEE SIOUX TRIBE |
|
1/1/2026 | 5.00 | % | 4,125,000 | 3,871,808 | ||||||||||||||
LOWER BRULE SIOUX TRIBE |
|
3/1/2025 | 5.88 | % | 1,390,000 | 1,364,063 | ||||||||||||||
OGLALA SIOUX TRIBE OF PINE RIDGE |
|
10/1/2024 | 5.50 | % | 1,985,000 | 1,995,997 | ||||||||||||||
OGLALA SIOUX TRIBE OF PINE RIDGE |
|
10/1/2022 | 5.00 | % | 1,560,000 | 1,558,674 | ||||||||||||||
|
|
|
|
|||||||||||||||||
South Dakota (amortized cost $18,661,622) |
|
18,680,000 | 17,575,533 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Puerto Rico 13.7% |
||||||||||||||||||||
COMMONWEALTH OF PUERTO RICO(a) |
|
7/1/2035 | 8.00 | % | 2,500,000 | 1,062,500 | ||||||||||||||
PUERTO RICO SALES TAX FINANCING CORP(d) |
|
8/1/2045 | 0.00 | % | 7,100,000 | 1,401,753 | ||||||||||||||
PUERTO RICO SALES TAX FINANCING CORP(d) |
|
8/1/2039 | 0.00 | % | 10,000,000 | 1,447,400 | ||||||||||||||
PUERTO RICO SALES TAX FINANCING CORP(d) |
|
8/1/2038 | 0.00 | % | 20,000,000 | 3,090,600 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Puerto Rico (amortized cost $9,128,584) |
|
39,600,000 | 7,002,253 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Oregon 11.2% |
||||||||||||||||||||
MULTNOMAH CITY HOSPITAL FACILITY ODD FELLOWS |
|
9/15/2020 | 5.45 | % | 6,345,000 | 5,710,500 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Oregon (amortized cost $6,345,000) |
|
6,345,000 | 5,710,500 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
South Carolina 11.1% |
||||||||||||||||||||
GREEN MIDLANDS CHARTER SCHOOL SENIOR SERIES 2016A |
|
12/1/2021 | 5.25 | % | 5,655,000 | 5,662,238 | ||||||||||||||
|
|
|
|
|||||||||||||||||
South Carolina (amortized cost $5,655,000) |
|
5,655,000 | 5,662,238 | |||||||||||||||||
|
|
|
|
12
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Other Municipal Bonds (Continued) | Maturity |
Coupon |
Principal |
Value |
||||||||||||||||
Multi-State 9.6% |
||||||||||||||||||||
FREDDIE MAC(g)(j) |
|
1/1/2037 | 9.75 | % | $ | 4,904,915 | $ | 4,904,915 | ||||||||||||
|
|
|
|
|||||||||||||||||
Multi-State (amortized cost $4,904,915) |
|
4,904,915 | 4,904,915 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Arizona 9.6% |
|
|||||||||||||||||||
HERITAGE ACADEMY CHARTER SCHOOL MARICOPA COUNTY |
|
7/1/2027 | 5.25 | % | 5,000,000 | 4,902,800 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Arizona (amortized cost $5,000,000) |
|
5,000,000 | 4,902,800 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Washington 6.9% |
|
|||||||||||||||||||
TACOMA CONSOLIDATED LID |
|
4/1/2043 | 5.75 | % | 3,495,000 | 3,509,469 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Washington (amortized cost $3,335,900) |
|
3,495,000 | 3,509,469 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Missouri 2.7% |
|
|||||||||||||||||||
KANSAS CITY INDL DEV AUTH |
|
1/1/2028 | 6.75 | % | 512,000 | 513,603 | ||||||||||||||
ST LOUIS INDL DEV AUTH SR HSG SENIOR SERIES 2005A |
|
5/1/2027 | 6.75 | % | 891,000 | 846,896 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Missouri (amortized cost $1,403,000) |
|
1,403,000 | 1,360,498 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Oklahoma 0.9% |
|
|||||||||||||||||||
HASKELL CNTY PUBLIC FAC. |
|
4/1/2024 | 5.25 | % | 450,000 | 461,853 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Oklahoma (amortized cost $450,000) |
|
450,000 | 461,853 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Other Municipal Bonds |
|
$ | 85,532,915 | $ | 51,090,060 | |||||||||||||||
|
|
|
|
|||||||||||||||||
13
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
Colorado Taxable Certificates/Notes/Bonds 0.6% | Maturity |
Coupon |
Principal |
Value |
||||||||||||||||
Colorado 100.0% |
|
|||||||||||||||||||
PUBLIC FINANCE AUTHORITY COLO EARLY COLLEGES CHARTER SCHOOL SERIES 2016B TAX |
|
7/1/2023 | 5.75 | % | $ | 7,105,000 | $ | 6,840,623 | ||||||||||||
TABERNASH POLE CREEK NOTE(a)(j) |
|
9/30/2018 | 0.00 | % | 227,347 | 127,601 | ||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado (amortized cost $7,332,347) |
|
7,332,347 | 6,968,224 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Colorado Taxable Certificates/Notes/Bonds |
|
$ | 7,332,347 | $ | 6,968,224 | |||||||||||||||
|
|
|
|
|||||||||||||||||
Total investments, at value |
73.5 | % | $ | 881,764,598 | ||||||||||||||||
Other assets net of liabilities |
26.5 | % | 317,967,271 | |||||||||||||||||
|
|
|
|
|||||||||||||||||
Net assets |
100.0 | % | $ | 1,199,731,869 | ||||||||||||||||
|
|
|
|
14
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
(a) | Defaulted or non-income producing based upon the financial condition of the issuer (see note 2 in notes to financial statements). |
(b) | Originally issued as general obligation bonds but are now pre-refunded and are secured by an escrow fund consisting entirely of direct U.S. Government obligations. |
(c) | Represents securities whose blended characteristics are reflective of a zero coupon bond and a step rate bond. Interest rate shown represents effective yield at acquisition. |
(d) | Interest rate shown for capital appreciation and zero coupon bonds represents the effective yield at the date of acquisition. |
(e) | Principal-only certificate represents the right to receive the principal payments on the underlying debt security upon maturity. The price of this security is typically more volatile than that of coupon-bearing bonds of the same maturity. |
(f) | Interest-only certificate represents the right to receive semi-annual interest payments on the underlying debt security. The principal amount of the underlying security represents the notional amount on which current interest is calculated. The interest rate shown represents the effective yield at the date of acquisition. |
(g) | Interest rate disclosed for cash flow bond represents the effective yield at March 31, 2018. Income on this security is derived from the cash flow of the issuer. |
(h) | Represents current interest rate for a step rate bond. No step rate bonds were owned by the Fund at March 31, 2018. |
(i) | Terms of security have been restructured since the original issuance. The total face amount of all such restructured securities approximates $10,935,693 and a value of $6,743,364 or less than 1.0% of net assets, as of March 31, 2018. |
(j) | Securities valued at fair value (see note 2 in notes to financial statements). |
(k) | See note 7 in notes to financial statements for further information on purchase accrued interest related to these bonds. |
See accompanying notes to financial statements.
15
Colorado BondShares
A Tax-Exempt Fund
Schedule of Investments (unaudited) (Continued)
(LOC) | These securities are Variable Rate Demand Obligations (VRDO) with scheduled principal and interest payments that have a guaranteed liquidity provider in the form of a letter of credit. These obligations bear interest at a rate that resets daily or weekly (see note 2 in notes to financial statements). The numbered list below corresponds to the liquidity provider associated with the respective LOC. |
1. BNP Paribas
2. FHLB Topeka
3. US Bank, N. A.
4. Royal Bank of Canada
5. JPMorgan Chase Bank, N.A.
6. Freddie Mac
The following abbreviations are used in the descriptions of securities included in the Schedule of Investments:
CABS Capital Appreciation Bonds
CONV Convertible
I/O Interest Only
L/D Local Improvement District
P/O Principal Only
See accompanying notes to financial statements.
16
Colorado BondShares
A Tax-Exempt Fund
Statement of Assets and Liabilities
March 31, 2018 (unaudited)
ASSETS | ||||
Investments, at value (amortized cost 918,562,336) |
$ | 881,764,598 | ||
see accompanying schedule |
||||
Cash |
193,719,957 | |||
Interest receivable |
82,507,820 | |||
Purchase accrued interest (note 7) |
44,086,942 | |||
Receivable for shares of beneficial interest sold |
784,373 | |||
|
|
|||
TOTAL ASSETS |
1,202,863,690 | |||
|
|
|||
LIABILITIES | ||||
Payables and other liabilities: |
||||
Dividends payable |
1,996,250 | |||
Payable for shares of beneficial interest redeemed |
14,963 | |||
Management fees payable |
506,438 | |||
Accrued expenses payable |
614,170 | |||
|
|
|||
TOTAL LIABILITIES |
3,131,821 | |||
|
|
|||
NET ASSETS |
$ | 1,199,731,869 | ||
|
|
|||
COMPOSITION OF NET ASSETS |
||||
Paid-in capital |
$ | 1,230,240,934 | ||
Accumulated net realized gain |
6,288,674 | |||
Net unrealized depreciation of investments |
(36,797,739 | ) | ||
|
|
|||
NET ASSETS |
$ | 1,199,731,869 | ||
|
|
|||
NET ASSET PRICE AND REDEMPTION PRICE PER SHARE |
$ | 9.07 | ||
|
|
|||
MAXIMUM OFFERING PRICE PER SHARE |
$ | 9.52 | ||
|
|
See accompanying notes to financial statements.
17
Colorado BondShares
A Tax-Exempt Fund
Statement of Operations
For the Six Months Ended March 31, 2018 (unaudited)
INVESTMENT INCOME |
||||
Interest |
$ | 27,405,042 | ||
EXPENSES |
||||
Management fees (note 4) |
2,897,110 | |||
Custodian fees (note 5) |
45,654 | |||
Legal and auditing fees |
114,617 | |||
Portfolio pricing fees |
15,756 | |||
Registration fees |
5,697 | |||
Shareholders reports |
46,548 | |||
Transfer agency expenses (note 4) |
91,257 | |||
Trustees fees |
6,006 | |||
Other |
63,212 | |||
|
|
|||
Total expenses |
3,285,857 | |||
Custody credits (note 5) |
(33,351 | ) | ||
|
|
|||
Net expenses |
3,252,506 | |||
|
|
|||
NET INVESTMENT INCOME |
24,152,536 | |||
|
|
|||
REALIZED AND UNREALIZED GAIN ON INVESTMENTS |
||||
Net realized gain on investments |
6,396,853 | |||
Net unrealized depreciation on investments |
(1,665,897 | ) | ||
|
|
|||
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS |
4,730,956 | |||
|
|
|||
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS |
$ | 28,883,492 | ||
|
|
See accompanying notes to financial statements.
18
Colorado BondShares
A Tax-Exempt Fund
Statements of Changes in Net Assets
For the Periods Indicated
Six Months Ended March 31, 2018 |
Year Ended September 30, 2017 |
|||||||
(unaudited) | ||||||||
FROM OPERATIONS: |
||||||||
Net investment income |
$ | 24,152,536 | $ | 49,322,705 | ||||
Net realized gain on investments |
6,396,853 | 2,024,480 | ||||||
Unrealized depreciation on investments |
(1,665,897 | ) | (7,899,878 | ) | ||||
|
|
|
|
|||||
Net increase in net assets resulting from operations |
28,883,492 | 43,447,307 | ||||||
|
|
|
|
|||||
FROM DISTRIBUTIONS TO SHAREHOLDERS: (note 2) |
||||||||
Dividends to shareholders from net investment income |
(24,152,536 | ) | (49,322,705 | ) | ||||
Net realized gain to shareholders from investment transactions |
(2,461,987 | ) | (8,438,030 | ) | ||||
|
|
|
|
|||||
Total distributions to shareholders |
(26,614,523 | ) | (57,760,735 | ) | ||||
|
|
|
|
|||||
FROM BENEFICIAL INTEREST TRANSACTIONS: |
||||||||
Proceeds from sale of shares |
85,622,988 | 150,272,882 | ||||||
Reinvested dividends and distributions |
17,516,596 | 38,653,680 | ||||||
Redemption of shares |
(43,493,894 | ) | (98,802,502 | ) | ||||
|
|
|
|
|||||
Increase in net assets derived from beneficial interest transactions |
59,645,690 | 90,124,060 | ||||||
|
|
|
|
|||||
Net increase in net assets |
61,914,659 | 75,810,632 | ||||||
NET ASSETS: |
||||||||
Beginning of period |
1,137,817,210 | 1,062,006,578 | ||||||
|
|
|
|
|||||
End of period |
$ | 1,199,731,869 | $ | 1,137,817,210 | ||||
|
|
|
|
See accompanying notes to financial statements.
19
Colorado BondShares
A Tax-Exempt Fund
Financial Highlights
The financial highlights table is intended to help you understand the Funds financial performance. Certain information reflects financial results for a single Fund share. The total returns in the table represent the rate that an investor would have earned (or lost) on an investment in the Fund (assuming reinvestment of all dividends and distributions). Sales charges are not reflected in the total returns.
For Fiscal Years Ended September 30 | ||||||||||||||||||||||||
3/31/2018 | 2017 | 2016 | 2015 | 2014 | 2013 | |||||||||||||||||||
For a share outstanding throughout the period | (unaudited) | |||||||||||||||||||||||
Net asset value, beginning of period |
$ | 9.05 | $ | 9.18 | $ | 9.14 | $ | 9.11 | $ | 9.00 | $ | 9.24 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Income From Investment Operations |
||||||||||||||||||||||||
Net investment income(1) |
0.19 | 0.41 | 0.39 | 0.37 | 0.41 | 0.39 | ||||||||||||||||||
Net gain or (loss) on investments (both realized and unrealized) |
0.04 | (0.06 | ) | 0.06 | 0.04 | 0.12 | (0.24 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Increase from investment operations |
0.23 | 0.35 | 0.45 | 0.41 | 0.53 | 0.15 | ||||||||||||||||||
Less Distributions |
||||||||||||||||||||||||
Dividends to shareholders from net investment income |
(0.19 | ) | (0.41 | ) | (0.39 | ) | (0.37 | ) | (0.41 | ) | (0.39 | ) | ||||||||||||
Distributions from realized capital gains |
(0.02 | ) | (0.07 | ) | (0.02 | ) | (0.01 | ) | (0.01 | ) | | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Distributions |
(0.21 | ) | (0.48 | ) | (0.41 | ) | (0.38 | ) | (0.42 | ) | (0.39 | ) | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net increase (decrease) in net asset value |
0.02 | (0.13 | ) | 0.04 | 0.03 | 0.11 | (0.24 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Net Asset Value, end of period |
$ | 9.07 | $ | 9.05 | $ | 9.18 | $ | 9.14 | $ | 9.11 | $ | 9.00 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Total Return, at Net Asset Value(2) |
2.51 | %+ | 4.03 | % | 5.07 | % | 4.48 | % | 6.06 | % | 1.58 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Ratios/Supplemental Data: |
||||||||||||||||||||||||
Ratios to average net assets: |
||||||||||||||||||||||||
Net investment income |
4.20 | %* | 4.54 | % | 4.29 | % | 4.03 | % | 4.52 | % | 4.23 | % | ||||||||||||
Total expenses |
0.57 | %* | 0.62 | % | 0.56 | % | 0.58 | % | 0.71 | % | 0.73 | % | ||||||||||||
Net expenses |
0.56 | %* | 0.61 | % | 0.55 | % | 0.58 | % | 0.70 | % | 0.73 | % | ||||||||||||
Net assets, end of period (000s) |
$ | 1,199,732 | $ | 1,137,817 | $ | 1,062,007 | $ | 921,523 | $ | 891,733 | $ | 872,586 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Portfolio turnover rate(3) |
10.48 | % | 8.77 | % | 16.77 | % | 19.06 | % | 11.36 | % | 8.21 | % | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
+ | not annualized |
* | annualized |
(1) | Net investment income per share was calculated using an average shares method. |
(2) | Assumes a hypothetical initial investment on the business day before the first day of the fiscal period, with all dividends reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Sales charges are not reflected in the total returns. |
(3) | The portfolio turnover rate is computed by dividing the lesser of purchases or sales of portfolio securities for a period by the monthly average of the value of portfolio securities owned during the period. Sales of securities include the proceeds of securities which have been called, or for which payment has been made through redemption or maturity. Securities with a maturity date of one year or less at the time of acquisition are excluded from the calculation. Cost of purchases and proceeds from sales of investment securities (excluding short-term securities) for the period ended March 31, 2018 were $76,679,691 and $125,081,996, respectively. |
See accompanying notes to financial statements.
20
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited)
(1) | Organization |
Colorado BondShares A Tax-Exempt Fund (the Fund) is registered under the Investment Company Act of 1940, as amended, as a diversified, open-end management company. The Funds investment objectives are to maximize income exempt from federal income taxes and from personal income taxes of the State of Colorado to the extent consistent with the preservation of capital and to seek opportunities for capital appreciation. The Funds investment adviser is Freedom Funds Management Company (Freedom Funds). The following is a summary of significant accounting policies consistently followed by the Fund.
(2) | Summary of Significant Accounting Policies |
These financial statements have been prepared in conformity with accounting principles generally accepted in the United States of America. This requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. These financial statements reflect all adjustments which are, in the opinion of management, necessary to present a fair statement of financial position and results of operations for the reporting period. The following summarizes the significant accounting policies of the Fund:
(a) | Investment Valuation and Risk |
Securities for which there is no last sales price are valued by an independent pricing service based on evaluated prices that considers such factors as transactions in bonds, quotations from bond dealers, market transactions in comparable securities and various relationships between securities, or are fair valued by management.
Securities for which market quotations are not readily available (or management considers otherwise are no longer valid or reliable) are valued at fair value determined in accordance with procedures approved by the Board of Trustees. This can occur in the event of, among other things, natural disasters, acts of terrorism, market disruptions, intra-day trading halts, and extreme market volatility. The determination of fair value involves subjective judgments. As a result, using fair value to price a security may result in a price materially different from the prices used by other mutual funds to determine net asset value or the price that may be realized upon the actual sale of the security. Short-term holdings are valued at current market quotations or amortized cost whichever management believes best approximates fair value.
Fixed-income securities owned by the Fund are subject to interest-rate risk, credit risk, prepayment risk and market risk. The Fund invests in not rated securities which, may be subject to a greater degree of credit risk and risk of loss of income and principal, and may be more sensitive to economic conditions than lower yielding, higher rated fixed income securities. The Fund concentrates its investments in Colorado and, therefore, may be impacted by specific events, issuers or factors affecting Colorado. The Fund has more credit risk related to the economic conditions of Colorado than a portfolio with a broader geographical diversification.
21
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
Accounting Standards Codification (ASC) 820 Fair Value Measurements and Disclosures establishes a fair value hierarchy that classifies securities based on valuation techniques used to measure fair value and distinguish between observable inputs (market data obtained from independent sources) and the reporting entities own assumptions, which are not readily observable to market participants. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3).
Level 1 Inputs: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.
Level 2 Inputs: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. If the asset or liability has a specified (contractual) term, a Level 2 input must be observable for substantially the full term of the asset or liability.
Level 3 Inputs: Significant unobservable inputs for the asset or liability including managements own assumptions. Unobservable inputs shall be used to measure fair value to the extent that observable inputs are not available.
The following table summarizes the valuation of the Funds investments as defined by ASC 820 hierarchy levels as of March 31, 2018:
Valuation Inputs Summary
Colorado Municipal Bonds |
Short-Term Municipal Bonds |
Colorado Capital Appreciation and Zero Coupon Bonds |
Other Municipal Bonds |
Colorado Taxable Certificates/ Notes/ Bonds |
Total Securities 3/31/2018 |
|||||||||||||||||||
Level 1 Securities |
| | | | | | ||||||||||||||||||
Level 2 Securities |
558,608,242 | 176,535,264 | 24,228,679 | 46,185,145 | 6,840,623 | 812,397,953 | ||||||||||||||||||
Level 3 Securities |
27,860,815 | | 36,473,314 | 4,904,915 | 127,601 | 69,366,645 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Totals |
586,469,057 | 176,535,264 | 60,701,993 | 51,090,060 | 6,968,224 | 881,764,598 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
22
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
Colorado Municipal Bonds |
Short-Term Municipal Bonds |
Colorado Capital Appreciation and Zero Coupon Bonds |
Other Municipal Bonds |
Colorado Taxable Certificates/ Notes/Bonds |
Totals | |||||||||||||||||||
Level 3 Beginning Balance September 30, 2017 |
19,880,977 | 20,300,000 | 5,524,040 | 4,904,915 | 1,934,119 | 52,544,051 | ||||||||||||||||||
Unrealized Losses |
(19,829 | ) | (5,067,929 | ) | (588,470 | ) | | | (5,676,227 | ) | ||||||||||||||
Unrealized Gains |
| | | | | | ||||||||||||||||||
Realized Losses |
| | | | | | ||||||||||||||||||
Realized Gains |
37,531 | 4,558,656 | 702,771 | | | 5,298,957 | ||||||||||||||||||
Purchases |
8,003,837 | | 33,121,003 | | | 41,124,839 | ||||||||||||||||||
Sales |
(41,701 | ) | (19,790,727 | ) | (2,286,030 | ) | | (1,806,518 | ) | (23,924,976 | ) | |||||||||||||
Transfers In to Level 3* |
1,604,173 | | | | | 1,604,173 | ||||||||||||||||||
Transfers Out of Level 3* |
(1,604,173 | ) | | | | | (1,604,173 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
Balance as of March 31, 2018 |
27,860,815 | | 36,473,314 | 4,904,915 | 127,601 | 69,366,645 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
* Transfers from Level 2 to Level 3 are because of a lack, or change of observable inputs or reduced market data reliability. Transfers from Level 3 to Level 2 are the result of observable inputs becoming available or increased market data reliability. The Funds policy is to recognize transfers into and out of Level 3 when management becomes aware of a change to significant observable input or market data reliability.
From September 30, 2017 to March 31, 2018, there were no Level 1 Securities.
Significant Unobservable Inputs Quantitative Disclosure
Level 3 Securities* |
Fair Value March 31, 2018 |
Valuation Technique(s)** |
Unobservable Inputs |
Low | High | Weighted Average |
||||||||||||||
Colorado Municipal Bonds |
27,860,815 | discounted cash flow | probability of default | 5.00% | 100.00% | 17.97% | ||||||||||||||
Short-Term Municipal Bonds |
| discounted cash flow | probability of default | 0.00% | 0.00% | 0.00% | ||||||||||||||
Colorado Capital Appreciation and Zero Coupon Bonds |
36,473,314 | discounted cash flow | probability of default | 10.00% | 100.00% | 18.27% | ||||||||||||||
Other Municipal Bonds |
4,904,915 | discounted cash flow | probability of default | 0.00% | 1.00% | 1.00% | ||||||||||||||
Colorado Taxable Bonds/Certificates/Notes |
127,601 | discounted cash flow | probability of default | 100.00% | 100.00% | 100.00% | ||||||||||||||
|
|
|||||||||||||||||||
Total Level 3 Securities at March 31, 2018 |
69,366,645 | |||||||||||||||||||
|
|
The significant unobservable inputs used in the fair value measurement of the Funds securities are collateral value, probability of default, and loss severity in the event of default. Any changes in unobservable inputs may result in substantial changes to fair value measurements.
* The inputs for these securities are not readily available or cannot be reasonably estimated and are generally those inputs described in note 2(a). The appropriateness of fair values for these securities is based on results of back testing, broker due diligence, unchanged price review and consideration of macro or security specific events.
** Other unobservable inputs used in the discounted cash flow technique include collateral value and loss severity. These unobservable inputs are specific to the characteristics of each security being valued.
23
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
(b) | Cash |
The Fund continually monitors its positions with, and the credit quality of, the financial institutions with which it invests. As of March 31, 2018, and periodically throughout the year, the Fund has maintained balances in various operating accounts in excess of federally insured limits.
(c) | Income Tax Information and Distributions to Shareholders |
The Fund intends to comply with the requirements of Subchapter M of the Internal Revenue Code, as amended, applicable to regulated investment companies and to distribute all its net investment income and any net realized gain on investments not offset by capital loss carryforwards to shareholders. The Fund distributes investment income monthly and due to the tax-exempt nature of its investments the income is generally non-taxable to the shareholders. The Fund distributes net realized capital gains, if any, to its shareholders at least annually. Income distributions and capital gain distributions are determined in accordance with income tax regulations, which may differ from generally accepted accounting principles. These differences are primarily due to the differing treatment of tax allocations.
Management has reviewed the Funds tax position for all open tax years. As of March 31, 2018, the Fund did not have a liability for any unrecognized tax benefits. The fund recognizes interest and penalties, if any, related to unrecognized tax benefits as income tax expense in the Statement of Operations. The Fund has no examinations in progress.
At March 31, 2018, the cost and unrealized appreciation (depreciation) of investments, as determined on a federal income tax basis , were as follows:
Cost of investments |
$ | 918,562,336 | ||
|
|
|||
Gross unrealized appreciation |
$ | 11,057,456 | ||
Gross unrealized depreciation |
(47,855,194 | ) | ||
|
|
|||
Net unrealized depreciation of investments |
$ | (36,797,738 | ) | |
|
|
For tax purposes, capital losses may be carried over to offset future capital gains, if any. Under the Regulated Investment Company Modernization Act of 2010, capital losses incurred by the Fund in taxable years beginning after December 22, 2010 are not subject to expiration and such losses retain their character as either short-term or long-term rather than being considered short-term as under previous law. Post-enactment capital losses must be fully utilized prior to utilizing any losses incurred in pre-enactment tax years.
(d) | Defaulted or Non-income Producing Investments |
The Fund discontinues the accrual of interest income on municipal bonds when the securities become delinquent as to payment of principal or interest, or when the Funds investment adviser determines that an
24
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
uncertainty exists as to the realization of all or a portion of the principal balance. The face amount of bonds for which the accrual of interest income has been discontinued approximates $63,372,347 and such bonds have a value of $23,767,989 or 1.98% of net assets as of March 31, 2018. These securities have been identified in the accompanying Schedule of Investments.
(e) | Investment Transactions and Revenue Recognition |
Investment transactions are accounted for on the date the investments are purchased or sold (trade date). Purchases and sales of securities, other than short-term securities, aggregated to $76,679,691 and $125,081,996, respectively.
Dividends to shareholders are declared each business day and paid monthly. Distributions to shareholders are recorded on the ex-dividend date. Realized gains and losses from investment transactions are calculated using the identified-cost basis, which is the same basis the Fund uses for federal income tax purposes. Interest income is recorded on the accrual basis.
Variable Rate Demand Obligations (VRDO) purchased by the Fund are floating rate obligations that have a nominal long-term maturity but have a coupon rate that is reset periodically (e.g., daily or weekly). The investor has the option to put the issue back to the trustee or tender agent at any time with specified (e.g., seven days) notice; accordingly, the Fund treats these obligations as short-term holdings. On March 31, 2018, the interest rates paid on these obligations ranged from 1.52% to 1.68%.
(f) | Classification of Distributions to Shareholders |
The character of distributions made during the year from net investment income or net realized gains may differ from its ultimate characterization for federal income tax purposes. Also, due to timing of dividend distributions, the fiscal year in which amounts are distributed may differ from the fiscal year in which the income or realized gain was recorded by the Fund.
(g) | Securities Purchased on a When-Issued Basis |
The Fund may purchase securities on a when-issued basis with payment and delivery scheduled for a future date. These transactions are subject to market fluctuations and may increase or decrease in value prior to the delivery date. The Fund maintains segregated assets with a value equal to or greater than the amount of its purchase commitments. The Fund did not have any when-issued securities at March 31, 2018.
25
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
(3) | Shares of Beneficial Interest |
The Fund has an unlimited number of no par value shares of beneficial interest authorized. Transactions in shares of beneficial interest were as follows:
Six Months Ended March 31, 2018 |
Year Ended September 30, 2017 |
|||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
(unaudited) | ||||||||||||||||
Shares sold |
9,471,049 | $ | 85,622,988 | 16,690,637 | $ | 150,272,882 | ||||||||||
Dividends reinvested |
1,937,119 | 17,516,596 | 4,302,757 | 38,653,680 | ||||||||||||
|
|
|
|
|
|
|
|
|||||||||
11,408,168 | 103,139,584 | 20,993,394 | 188,926,562 | |||||||||||||
Shares redeemed |
(4,809,944 | ) | (43,493,894 | ) | (10,993,823 | ) | (98,802,502 | ) | ||||||||
|
|
|
|
|
|
|
|
|||||||||
Net increase in shares outstanding |
6,598,224 | $ | 59,645,690 | 9,999,571 | $ | 90,124,060 | ||||||||||
|
|
|
|
|
|
|
|
(4) | Management Fees and Other Transactions with Affiliates |
Management fees paid to Freedom Funds were in accordance with the investment advisory agreement with the Fund, which provides for an annual fee equivalent to 0.5% of the net assets of the Fund. Freedom Funds pays all expense associated with advertising, marketing, and distributing the Funds shares and serves as the transfer agent, dividend disbursing agent, and registrar for the Fund. Freedom Funds provided certain transfer agency and shareholder services as part of the management fee arrangement for the period ended March 31, 2018. Transfer agency expenses on the Statement of Operations represent direct expenses charged to the Fund by third parties.
Allen Insurance, an affiliate of the investment adviser, acted as agent for the Fidelity Bond and the Errors and Omissions insurance policy maintained by the Fund and as a result received compensation in the form of commissions. The policies were provided by Travelers Insurance Company and all the commissions referred to above were paid by Travelers Insurance Company. Allen Insurance received no compensation directly from the assets of the Fund.
The Fund does not have any Trustees who are affiliated with the Advisor or Distributor. The Board of Trustees appointed a Chief Compliance Officer to the Fund in accordance with federal securities regulations. The Fund does not reimburse the Advisor for any compensation or fees associated with the Chief Compliance Officer.
26
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
(5) | Custody Credits |
Expenses paid indirectly by the Fund represent earnings credits on cash balances maintained with the Funds custodian bank, UMB Bank, N.A. The earnings credits resulted in offsetting custodian fees of $33,351 the period ended March 31, 2018.
(6) | Indemnification |
From time to time, the Fund may be involved in certain disputes and legal actions arising in the ordinary course of its business. While it is not feasible to predict or determine the outcome of these proceedings, in managements opinion, based on a review with legal counsel, none of these disputes or legal actions are expected to have a material impact on its financial position or results of operations. However, litigation is subject to inherent uncertainties, and an adverse result in these matters may arise from time to time that may harm the Funds business.
In the normal course of business, the Fund enters into contracts that contain a variety of representations, which provide general indemnifications. The Funds maximum exposure under these arrangements is unknown, as this would involve future claims that may be made against the Fund that have not yet occurred. However, based on experience, the Fund expects the risk of loss to be remote.
(7) | Purchase Accrued Interest |
Purchase accrued interest is typically a component of a municipal bond purchase and is paid on settlement date. The accrual period begins on the last interest payment date (or original issue date) and runs through the day immediately preceding the settlement date. The Fund has purchased three bonds from the Meadows Metropolitan Districts No. 1, 2 and 7 with an aggregate balance of purchase accrued of $44,026,872 (99.9% of the March 31, 2018 balance of $44,086,942). Approximately $68,609,321 of additional interest has accrued on the purchase accrued interest since its purchase in 2007. This additional accrued interest has been fair valued in accordance with ASC 820 at approximately $51,742,233 and is included in other assets net of liabilities in the Schedule of Investments. This amount bears interest at the rate of 7.999% and will be received over an uncertain period of years. The value of the Meadows bonds is contained within three separate line items of the financial statements, which all relate to a single set of bonds that cannot be sold separately.
(8) | Litigation |
The Fund is periodically involved in various legal proceedings. At March 31, 2018, the Fund has a litigation accrual of $448,345 for all pending litigation matters primarily for the purpose of paying lawyer fees. Possible additional amounts cannot be currently estimated but will be set aside as needed. Although there can be no assurances, based on information available, management believes that it is probable that the ultimate outcome of the action described below and other matters that are pending or threatened will not have a material effect on the Funds financial condition.
27
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
(a) | Marin Metropolitan District LTD Tax G.O. Series 2008 |
The Fund is the beneficial owner of bonds issued in 2008 (the Bonds) by Marin Metropolitan District (the District) as described more fully in the Funds most recent quarterly schedule of portfolio holdings for the period ended December 31, 2017 on Form N-Q that was filed with the Securities and Exchange Commission (SEC) on February 28, 2018. The original principal amount of Bonds was $30,485,000. The current principal amount of the Bonds is $17,485,000. The valuation of these Bonds as of September 30, 2017 was set forth in the schedule of investments included in the Funds above referenced 2017 shareholder report.
On June 1, 2011, Landmark Towers Association, Inc. (Landmark), a homeowner association, filed an action on behalf of its members entitled Landmark Towers Assn, et al. v. UMB Bank, et al., Case Number 2011-CV-1076 (the Landmark Litigation) in Arapahoe County District Court, Colorado (the District Court). The complaint filed in the Landmark Litigation sought a temporary restraining order, declaratory relief and permanent injunction against the District, the Fund, and UMB Bank (UMB), the trustee, alleging that the taxes imposed by the District, which were pledged to pay the Bonds, violated TABOR.
In August of 2011, Landmark sought to freeze approximately $13,000,000 in original proceeds from the sale of the Bonds to the Fund, which moneys were held by UMB as trustee. The District Court denied Landmarks efforts to freeze the $13,000,000 and allowed those moneys to be paid to the Fund, which reduced the principal amount of the Bonds to the current level. In July and August of 2013, the District Court held a bench trial regarding Landmarks claims for declaratory relief and permanent injunction. On September 6, 2013, the District Court issued an order (Sept. 6 Order) that the District was properly formed and that the election approving the taxes was proper, but nonetheless held that there were violations of TABOR relating to the property taxes. In particular, the District Court held that (1) bond proceeds were used to pay improper charges of the developer; (2) the taxes exceeded the maximum mill levy for debt service; and (3) the taxes did not benefit the Landmark taxpayers. After holding that the taxes did not provide a benefit to the Landmark taxpayers, the Court enjoined the District from imposing its taxes on the Landmark members for purposes of paying the Bonds (the Injunction). The Fund, the District, and UMB filed a motion for reconsideration of the Sept. 6 Order, which the District Court denied in an order dated October 31, 2013 (Oct. 31 Order). While the Fund was not found to be responsible for damages based on the asserted TABOR violations, the District Court on March 10, 2014, entered an order allowing Landmark to pursue claims for fraudulent transfer and constructive trust that could result in the Fund being ordered to pay some or all of the tax refund obligations of the District.
In August 2014, the District Court held a four-day trial on the newly asserted claims against the Fund, and on September 10, 2014, the District Court issued an order (the Sept. 10 Order) denying each of the new claims asserted against the Fund. Landmark, however, filed a post-trial motion for reconsideration of the Sept. 10 Order, which motion was denied on November 12, 2014.
The Fund filed a Notice of Appeal of the Sept. 6 Order and the Oct. 31 Order, including the Injunction.
28
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
On April 21, 2016, the Colorado Court of Appeals issued an Opinion (the April 2016 Opinion), in which it concluded that the TABOR election held for approving the Bonds and the Districts ad valorem property taxes was invalid because eligible electors were denied the right to vote in the election and that ineligible electors voted in the election. Based on those decisions, the Court of Appeals upheld the injunction against the District, prohibiting it from levying taxes for payment of the Bonds.
The April 2016 Opinion of the Colorado Court of Appeals also has created uncertainty in the Colorado public finance market in that it calls into question the process that is routinely used to qualify electors for special district elections in Colorado. Emergency legislation was introduced in the Colorado legislature to remove the uncertainty and any impact the April 2016 Opinion may have on other special district financings. The legislation was passed unanimously by the Colorado General Assembly and was signed by the Governor on May 18, 2016.
In a further effort to reduce any impact the April 2016 Opinion may have on the Colorado public finance market, the Fund filed a Petition for Rehearing with the Court of Appeals, asking it to withdraw a portion of the April 2016 Opinion as unnecessary. That Petition was filed on May 5, 2016, and was denied on May 12, 2016.
The Fund filed a petition with the Colorado Supreme Court to review the Court of Appeals Opinion on various grounds, and the Supreme Court granted the petition for review on November 7, 2016. On December 11, 2017, the Supreme Court reversed the Court of Appeals Opinion on the grounds that all claims challenging the election held by the District in 2007 were barred under C.R.S. § 1-11-213(4) (which requires an election contest to be filed no later than 10 days after the certification of the results of an election). The Supreme Court, however, remanded the case back to the Court of Appeals to decide issues that were not decided in the April 2016 Opinion.
On January 8, 2018, Landmark filed a Petition for Rehearing asking the Supreme Court to reconsider its decision to reverse the Court of Appeals April 2016 Opinion. On January 22, 2018, the Supreme Court denied the Petition for Rehearing.
The issues before the Court of Appeals upon remand include whether the due process rights of the District taxpayers were violated. If the Court of Appeals upholds the trial courts decision, the tax revenues pledged to pay the Bonds would be reduced. The Fund is confident that it will prevail upon remand to the Court of Appeals.
However, it is not possible to determine the direction, cost, duration or ultimate outcome of the Landmark Litigation. In addition, litigation is expensive and time consuming and, while the Fund fully intends to recover its costs, there can be no assurance that this will occur and there could be further adverse effects on dividend distributions and net asset values of the Fund while the matter is pending.
29
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
(b) | United Water & Sanitation District Ravenna Project Series 2009 (River Canyon Real Estate Investments, LLC Bankruptcy) |
On July 31, 2013 the U.S. Bankruptcy Court confirmed a Chapter 11 bankruptcy plan proffered by bankrupt developer River Canyon (associated with development within the Ravenna District). The Fund had opposed the plan because of the unfavorable treatment of creditors and participated in an appeal of the Bankruptcy Courts decision. The Fund was indirectly involved in a related case which was removed to the Douglas County District Court by the bankruptcy court to determine the validity of certain liens filed on the developers lots to secure the United Water Bonds (as defined below) owned by the Fund. All matters pending in Douglas County District Court have now been decided or settled. The Fund was actively involved in global settlement negotiations with the parties in an attempt to permanently resolve these matters without incurring additional legal expenses associated with a trial. On November 16, 2017, the United Water Bonds were restructured in their entirety by re-scheduling the past obligations of the district to provide for their future payment. This restructuring ends the need for further negotiations or litigation between the parties.
(c) | Ravenna Metropolitan District |
The Fund is the holder of approximately $11,380,000 of General Obligation Limited Tax Bonds, Series 2007 and Supplemental B Interest Registered Coupons (collectively the Ravenna Bonds) issued by Ravenna Metropolitan District (Ravenna). In addition, Ravenna also owes United Water and Sanitation District (United) approximately $6,875,000 arising under the Lease Purchase Agreement and related Water Services Agreement (collectively the Water Agreements). United in turn is obligated to the Fund pursuant to revenue bonds, Series 2007 issued by United to the Fund (the United Water Bonds), which United Water Bonds are payable from these revenue streams.
Ravenna filed a voluntary petition for bankruptcy under Chapter 9 of the United States Bankruptcy Code seeking relief under the United States Bankruptcy Code asserting that it is not generally able to pay its debts as they became due and that it will not be able to pay debts as they prospectively become due after the filing of its bankruptcy petition. The Fund challenged the eligibility of Ravenna to seek relief under the Bankruptcy Code, asserting, that Ravenna is generally able to pay its debts as they became due as such term is defined under the United States Bankruptcy Code and interpreted in accordance with applicable laws. A five day trial was held to the Court in late July, 2014.
On December 15, 2014, the Bankruptcy Court entered an order dismissing Ravennas bankruptcy case finding that Ravenna did not meet the eligibility requirements under the Bankruptcy Code to file a Chapter 9 petition and finding that Ravenna lacked good faith in filing the petition. Ravenna appealed the Bankruptcy Courts dismissal of its Chapter 9 petition and that appeal was pending before the 10th Circuit Bankruptcy Appellate Panel until December 2016 when the case was dropped.
The parties have been involved in a very lengthy court-supervised mediation overseen by the Tenth Circuit Bankruptcy Appellate Panel. On November 16, 2017, the United Water Bonds were restructured in their entirety by re-scheduling the past obligations of the district to provide for their future payment. This restructuring ends the need for further negotiations or litigation between the parties.
30
Colorado BondShares
A Tax-Exempt Fund
Notes to Financial Statements (unaudited) (Continued)
(9) | Subsequent Events |
Management has evaluated the possibility of subsequent events in the Funds financial statements through the date of issuance. Management has determined that there are no material events that would require recognition or disclosure in the Funds financial statements through this date.
31
Other Information (unaudited)
Proxy Voting Record
The Fund does not invest in equity securities. Accordingly, there were no matters relating to a portfolio security considered during the 12 months ended June 30, 2017 with respect to which the Fund was entitled to vote. Applicable regulations require us to inform you that the foregoing proxy voting information is available on the SEC website at http://www.sec.gov or you may call us at 1-800-572-0069.
Quarterly Statement of Investments
The Fund files a complete statement of investments with the Securities and Exchange Commission for the first and third quarters for each fiscal year on Form N-Q. Shareholders may view the filed Form N-Q by visiting the Commissions website at http://www.sec.gov. The filed form may also be viewed and copied at the Commissions Public Reference Room in Washington, DC. Information regarding the operations of the Public Reference Room may be obtained by calling 1-800-732-0330 or you may call us at 1-800-572-0069.
32
A Tax-Exempt Fund
SEMI-ANNUAL REPORT
March 31, 2018
ITEM 2. CODE OF ETHICS.
Not required in this filing.
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
Not required in this filing.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Not required in this filing.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
Not applicable.
ITEM 6. INVESTMENTS.
(a) Please see the Schedule of Investments contained in the Semi-Annual Report included under Item 1 of this Form N-CSR.
(b) Not applicable.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
The registrant has not adopted procedures by which shareholders may recommend nominees to the registrants board of trustees.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant has adopted and maintained disclosure controls and procedures (as such term is defined in Rules 30a-3(c) under the Investment Company Act of 1940, as amended (the Act)) that are designed to ensure that information required to be disclosed in the registrants reports under the Act, is recorded, processed, summarized and reported within the time periods required under the SECs rules and forms and that the information is accumulated and communicated to the registrants management, including its principal executive officer and principal financial officer to allow for timely decisions regarding required disclosure.
As required by Rule 30a-3(b) of the Act, the registrant carried out an evaluation under the supervision and with the participation of its management, including its principal executive officer and principal financial officer, of the effectiveness of the design and operation of the registrants disclosure controls and procedures within the 90-day period prior to the filing date of this report. Based on the foregoing, the registrants principal executive officer and principal financial officer have concluded that the registrants disclosure controls and procedures were effective, as of that date.
(b) There were no changes in the registrants internal control over financial reporting (as defined in Rule 30a-3(d) under the Act) during the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting.
ITEM 12. DISCLOSURE OF SECURITIES LENDING ACTIVITIES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
Not applicable.
ITEM 13. EXHIBITS.
(a)(2)(i) |
(99.302) Interim Presidents (Principal Executive Officer) Section 302 Certification |
(a)(2)(ii) |
(99.302) Interim Treasurers (Principal Financial Officer) Section 302 Certification |
(a)(3) Not applicable. |
(b) |
(99.906) Combined Interim President & Treasurer (Principal Executive Officer and Principal Financial Officer) Section 906 Certification |
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Colorado BondShares A Tax-Exempt Fund |
/s/ George N. Donnelly |
George N. Donnelly, |
Interim President, Secretary and Treasurer Date: June 6, 2018 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
/s/ George N. Donnelly |
George N. Donnelly, |
Interim President, Secretary and Treasurer (Principal Executive Officer and Principal Financial Officer) Date: June 6, 2018 |
EXHIBIT (a)(2)(i) |
99.302 CERT |
I, George N. Donnelly, certify that:
1. I have reviewed this report on Form N-CSR of Colorado BondShares A Tax-Exempt Fund;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer and I have disclosed to the registrants auditors and audit committee of the registrants board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
Date: June 6, 2018
/s/ George N. Donnelly George N. Donnelly |
Interim President |
(Principal Executive Officer) |
EXHIBIT (a)(2)(ii) | 99.302 CERT |
I, George N. Donnelly, certify that:
1. I have reviewed this report on Form N-CSR of Colorado BondShares A Tax-Exempt Fund;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting that occurred during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrants internal control over financial reporting; and
5. The registrants other certifying officer and I have disclosed to the registrants auditors and audit committee of the registrants board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
Date: June 6, 2018
/s/ George N. Donnelly George N. Donnelly |
Interim Treasurer |
(Principal Financial Officer) |
EXHIBIT (b) | 99.906 CERT |
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
The undersigned hereby certifies in his capacity as Treasurer and President, respectively, of COLORADO BONDSHARES A TAX-EXEMPT FUND (the Fund), that:
(a) | The Form N-CSR of the Fund for the period ended March 31, 2018 (the Report) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Act of 1934, as amended; and |
(b) | the information contained in the Report fairly presents, in all material respects, the financial condition and the results of operations of the Fund. |
SIGNED ORIGINAL OF THIS WRITTEN STATEMENT REQUIRED BY SECTION 906 HAS BEEN PROVIDED TO COLORADO BONDSHARES A TAX-EXEMPT FUND AND WILL BE RETAINED BY THE TRUST AND FURNISHED TO THE SECURITIES AND EXCHANGE COMMISSION OR ITS STAFF UPON REQUEST.
Colorado BondShares A Tax-Exempt Fund
Date: June 6, 2018
/s/ George N. Donnelly |
George N. Donnelly |
Interim President and Treasurer |
(Principal Executive Officer and Principal Financial Officer) |
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