N-Q 1 ctftnq.txt CHURCHILL TAX-FREE TRUST 9/30/06 FORM N-Q FORM N-Q QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY Investment Company Act file number: 811-5086 Churchill Tax-Free Trust (Exact Name of Registrant as Specified in Charter) 380 Madison Avenue, Suite 2300 New York, New York 10017 (Address of Principal Executive Offices)(Zip Code) Joseph P. DiMaggio, Chief Financial Officer and Treasurer 380 Madison Avenue, Suite 2300 New York, New York 10017 (Name and address of Agent for Service) Registrant's Telephone Number, including Area Code: (212) 697-6666 Date of fiscal year end: December 31, 2005 Date of reporting period: September 30, 2006 Item 1. Schedule of Investments. CHURCHILL TAX-FREE FUND OF KENTUCKY SCHEDULE OF INVESTMENTS September 30, 2006 (unaudited) Rating
Principal Moody's/ Amount General Obligation Bonds (3.5%) S&P Value (a) ---------------------------------------------------------------------------------------------------------------- Bowling Green, Kentucky $ 200,000 5.300%, 06/01/18 Aa3/NR $ 214,226 Hardin County, Kentucky 170,000 5.000%, 06/01/17 AMBAC Insured Aaa/NR 176,292 Lexington-Fayette Urban County Government, Kentucky 2,000,000 4.750%, 05/01/24 FGIC Insured Aaa/AAA 2,048,920 Lexington-Fayette Urban County, Kentucky Government Project Unlimited Tax 340,000 5.150%, 12/01/17 Aa2/AA+ 361,471 Louisville - Jefferson County, Kentucky Metro Government Unlimited Tax 1,590,000 5.000%, 11/01/19 Aa2/AA 1,715,833 1,825,000 5.000%, 11/01/20 Aa2/AA 1,962,860 Louisville, Kentucky Unlimited Tax 2,205,000 5.000%, 10/01/21 FGIC Insured Aaa/AAA 2,323,849 Warren County, Kentucky Judicial Unlimited Tax 345,000 5.100%, 09/01/17 AMBAC Insured Aaa/NR 369,440 365,000 5.150%, 09/01/18 AMBAC Insured Aaa/NR 391,236 ------------- Total General Obligation Bonds 9,564,127 ------------- Revenue Bonds (99.2%) ---------------------------------------------------------- State Agencies (28.4%) ---------------------------------------------------------- Kentucky Area Development District Financing 500,000 5.000%, 12/01/23 LOC Wachovia Bank NR/AA 524,550 Kentucky Asset/Liability Commission 500,000 4.500%, 10/01/22 FGIC Insured Aaa/AAA 514,535 Kentucky Infrastructure Authority 1,000,000 5.250%, 06/01/12 Aa3/A+ 1,067,480 635,000 5.250%, 06/01/12 Aa3/A+ 647,554 2,740,000 5.250%, 06/01/14 Aa3/A+ 2,920,073 1,235,000 5.250%, 08/01/17 NR/AA 1,351,670 230,000 5.000%, 06/01/21 Aa3/A+ 241,070 Kentucky State Property and Buildings Commission 4,000,000 5.375%, 02/01/14 FSA Insured (pre-refunded) Aaa/AAA 4,343,080 1,000,000 5.000%, 11/01/15 AMBAC Insured Aaa/AAA 1,081,540 3,775,000 5.375%, 08/01/16 (pre-refunded) Aaa/AAA 4,076,094 2,725,000 5.375%, 08/01/16 FSA Insured Aaa/AAA 2,922,372 3,905,000 5.125%, 09/01/16 (pre-refunded) Aa3/AAA 4,121,649 975,000 5.000%, 08/01/17 FSA Insured Aaa/AAA 1,024,774 6,155,000 5.125%, 09/01/17 (pre-refunded) Aa3/AAA 6,496,479 4,735,000 5.250%, 10/01/17 Aa3/A+ 5,028,096 1,250,000 5.500%, 11/01/17 FSA Insured Aaa/AAA 1,371,375 1,000,000 5.000%, 11/01/17 AMBAC Insured Aaa/AAA 1,075,090 165,000 5.375%, 02/01/18 FSA Insured (pre-refunded) Aaa/AAA 179,152 3,950,000 5.125%, 09/01/18 (pre-refunded) Aa3/AAA 4,169,146 6,000,000 5.250%, 10/01/18 Aa3/A+ 6,368,820 1,500,000 5.000%, 11/01/18 AMBAC Insured Aaa/AAA 1,607,820 4,000,000 5.375%, 10/01/19 MBIA Insured (pre-refunded) Aaa/AAA 4,329,320 1,925,000 5.000%, 10/01/19 Aa3/A+ 2,012,280 360,000 5.000%, 10/01/19 MBIA Insured (pre-refunded) Aaa/AAA 383,515 785,000 5.150%, 11/01/19 FSA Insured Aaa/AAA 843,749 3,000,000 5.000%, 11/01/19 FSA Insured Aaa/AAA 3,183,540 5,000,000 5.000%, 10/01/22 MBIA Insured (pre-refunded) Aaa/AAA 5,422,850 235,000 5.000%, 08/01/23 MBIA Insured (pre-refunded) Aaa/AAA 254,444 80,000 5.000%, 08/01/23 MBIA Insured (pre-refunded) Aaa/AAA 86,619 Kentucky State Property Buildings Community Revenues 7,200,000 5.000%, 08/01/21 FSA Insured Aaa/AAA 7,741,656 2,500,000 5.000%, 08/01/24 FSA Insured Aaa/AAA 2,678,450 ------------ Total State Agencies 78,068,842 ------------ County Agencies (4.7%) ---------------------------------------------------------- Jefferson County, Kentucky Capital Projects 570,000 5.250%, 06/01/13 MBIA Insured Aaa/AAA 587,282 520,000 5.250%, 06/01/14 MBIA Insured Aaa/AAA 535,766 3,370,000 5.375%, 06/01/18 MBIA Insured++ Aaa/AAA 3,474,908 1,640,000 5.375%, 06/01/22 MBIA Insured Aaa/AAA 1,689,954 5,935,000 5.500%, 06/01/28 MBIA Insured Aaa/AAA 6,111,507 Nelson County, Kentucky Court Facilities Project Revenue 185,000 5.000%, 06/01/21 Aa3/NR 195,138 Warren County, Kentucky Justice Center 365,000 4.300%, 09/01/22 MBIA Insured Aaa/NR 367,405 ------------ Total County Agencies 12,961,960 ------------ City / Municipality Obligations (0.4%) ---------------------------------------------------------- Jeffersontown, Kentucky Public Project Corp. 500,000 5.750%, 11/01/15 A3/NR 510,805 Shelbyville, Kentucky Certificates of Participation 625,000 5.000%, 10/01/22 A2/NR 654,950 ------------ Total City / Municipality Obligations 1,165,755 ------------ Hospitals (6.6%) ---------------------------------------------------------- Jefferson County, Kentucky Health Facilities Revenue 1,715,000 5.650%, 01/01/17 AMBAC Insured Aaa/AAA 1,756,915 2,200,000 5.250%, 05/01/17 NR/A 2,333,386 815,000 5.125%, 10/01/17 AMBAC Insured ETM Aaa/AAA 835,994 Jefferson County, Kentucky Revenue Medical Center Revenue 2,000,000 5.500%, 05/01/22 NR/A 2,146,920 Kentucky Economic Development Finance Authority 1,000,000 5.000%, 02/01/18 FSA Insured Aaa/AAA 1,028,280 Louisville - Jefferson County, Kentucky Medical Center Revenue 1,000,000 5.000%, 06/01/18 NR/A 1,068,000 Louisville-Jefferson County, Kentucky Metropolitan Government Health System Revenue (Norton) 7,590,000 5.000%, 10/01/26+ NR/A- 7,874,094 1,000,000 5.000%, 10/01/30+ NR/A- 1,032,560 ------------ Total Hospitals 18,076,149 ------------ Housing (9.8%) ---------------------------------------------------------- Kentucky Housing Corporation Housing Revenue 140,000 4.200%, 01/01/15 AMT Aaa/AAA 141,550 250,000 4.100%, 01/01/15 AMT Aaa/AAA 251,140 170,000 4.100%, 07/01/15 AMT Aaa/AAA 170,775 265,000 4.650%, 01/01/16 AMT Aaa/AAA 271,996 210,000 4.300%, 01/01/16 AMT Aaa/AAA 212,386 150,000 4.250%, 01/01/16 AMT Aaa/AAA 151,861 200,000 4.200%, 01/01/16 AMT Aaa/AAA 201,344 420,000 4.650%, 07/01/16 AMT Aaa/AAA 432,835 610,000 4.300%, 07/01/16 AMT Aaa/AAA 616,930 550,000 4.200%, 07/01/16 AMT Aaa/AAA 553,696 555,000 4.200%, 01/01/17 Aaa/AAA 558,985 100,000 5.125%, 07/01/17 Aaa/AAA 102,177 680,000 4.200%, 07/01/17 Aaa/AAA 684,882 470,000 4.800%, 01/01/18 AMT Aaa/AAA 482,634 285,000 4.250%, 01/01/18 Aaa/AAA 286,855 95,000 5.550%, 07/01/18 AMT Aaa/AAA 95,000 575,000 4.800%, 07/01/18 AMT Aaa/AAA 590,456 180,000 4.250%, 07/01/18 Aaa/AAA 181,172 920,000 5.600%, 07/01/20 AMT Aaa/AAA 920,000 900,000 4.800%, 07/01/20 AMT Aaa/AAA 917,802 1,150,000 5.350%, 01/01/21 AMT Aaa/AAA 1,186,777 6,285,000 5.450%, 07/01/22 AMT Aaa/AAA 6,554,627 4,065,000 5.250%, 07/01/22 AMT Aaa/AAA 4,201,828 245,000 5.200%, 07/01/22 Aaa/AAA 252,681 415,000 5.100%, 07/01/22 AMT Aaa/AAA 427,023 4,140,000 5.200%, 07/01/25 AMT Aaa/AAA 4,276,454 275,000 5.375%, 07/01/27 Aaa/AAA 285,065 570,000 5.550%, 07/01/33 Aaa/AAA 591,495 Kentucky Housing Multifamily Mortgage Revenue 1,325,000 5.000%, 06/01/35 AMT NR/AAA 1,364,114 ------------ Total Housing 26,964,540 ------------ Schools (26.5%) ---------------------------------------------------------- Beechwood, Kentucky Independent School District Finance Corp. 180,000 5.650%, 03/01/20 Aa3/NR 191,178 Berea, Kentucky Educational Facilities Revenue (Berea College) 1,000,000 4.125%, 06/01/25 Aaa/NR 987,770 Boone County, Kentucky School District Finance Corp. 1,730,000 4.125%, 08/01/22 XLCA Insured Aaa/NR 1,733,097 Boone County, Kentucky School District Finance Corp. School Building 660,000 5.000%, 06/01/15 Aa3/NR 679,305 285,000 5.700%, 02/01/16 Aa3/NR 304,078 140,000 4.750%, 06/01/20 FSA Insured Aaa/AAA 145,263 1,000,000 5.375%, 08/01/20 FSA Insured AAA/NR 1,063,450 1,580,000 4.500%, 08/01/23 FSA Insured Aaa/NR 1,633,199 Boyd County, Kentucky School District Finance Corp. 1,025,000 5.000%, 10/01/15 Aa3/NR 1,058,948 575,000 5.375%, 10/01/17 Aa3/NR 595,551 Bullitt County, Kentucky School District Finance Corp. 200,000 4.300%, 10/01/21 Aaa/NR 203,658 2,455,000 4.500%, 10/01/22 MBIA Insured Aaa/NR 2,553,593 2,590,000 4.500%, 10/01/23 MBIA Insured Aaa/NR 2,690,414 Christian County, Kentucky School District Finance Corp. 820,000 4.000%, 08/01/19 XLCA Insured Aaa/NR 819,147 855,000 4.000%, 08/01/20 XLCA Insured Aaa/NR 850,468 905,000 4.000%, 08/01/21 XLCA Insured Aaa/NR 896,964 1,465,000 4.000%, 08/01/22 XLCA Insured Aaa/NR 1,446,321 1,525,000 4.125%, 08/01/23 XLCA Insured Aaa/NR 1,514,859 1,590,000 4.125%, 08/01/24 XLCA Insured Aaa/NR 1,575,070 Daviess County, Kentucky School District Finance Corp. 200,000 5.000%, 06/01/24 Aa3/NR 211,044 Fayette County, Kentucky School District Finance Corp. 5,000,000 4.250%, 04/01/23 FSA Insured Aaa/AAA 5,024,800 Floyd County, Kentucky School Building 680,000 4.375%, 10/01/22 Aa3/NR 689,343 Floyd County, Kentucky School Finance Corporation School Building 380,000 4.000%, 03/01/17 XLCA Insured Aaa/NR 383,553 1,320,000 4.000%, 03/01/23 XLCA Insured Aaa/NR 1,299,659 1,855,000 4.125%, 03/01/26 XLCA Insured Aaa/NR 1,839,028 Fort Thomas, Kentucky Independent School District Finance 785,000 4.375%, 04/01/21 Aa3/NR 801,210 Franklin County, Kentucky School District Finance Corp. 330,000 4.500%, 04/01/18 Aa3/NR 341,669 1,000,000 5.000%, 04/01/24 Aa3/NR 1,054,250 Graves County, Kentucky School Building Revenue 1,260,000 5.000%, 06/01/22 Aa3/NR 1,329,930 1,320,000 5.000%, 06/01/23 Aa3/NR 1,390,897 Hardin County, Kentucky School District Finance Corp. 1,475,000 4.000%, 02/01/19 AMBAC Insured Aaa/NR 1,473,510 Hickman County, Kentucky School District Finance Corp. School Building Revenue 250,000 5.000%, 06/01/24 Aa3/NR 263,805 Jefferson County, Kentucky School District Finance Corp. School Building 250,000 5.250%, 07/01/16 FSA Insured Aaa/AAA 264,020 150,000 5.000%, 04/01/20 FSA Insured Aaa/AAA 157,746 1,360,000 4.250%, 06/01/21 FSA Insured Aaa/AAA 1,376,660 Jessamine County, Kentucky School District Finance Corp. School Building Revenue 1,205,000 4.900%, 05/01/22 Aa3/NR 1,253,176 Kenton County, Kentucky School District 955,000 5.000%, 04/01/16 Aa3/NR 1,006,962 1,055,000 5.000%, 04/01/17 Aa3/NR 1,115,072 605,000 5.000%, 04/01/19 Aa3/NR 637,918 Kenton County, Kentucky School District Finance Corporatio 445,000 4.300%, 04/01/22 CIFG Insured Aaa/NR 453,344 4,250,000 5.000%, 06/01/22 MBIA Insured Aaa/NR 4,524,847 750,000 4.375%, 04/01/24 CIFG Insured Aaa/NR 765,488 325,000 4.400%, 04/01/26 CIFG Insured Aaa/NR 331,321 Kentucky Economic Development Finance Authority College Revenue Centre College 1,230,000 5.000%, 04/01/17 FSA Insured Aaa/AAA 1,306,395 1,675,000 5.000%, 04/01/19 FSA Insured Aaa/AAA 1,771,681 Larue County, Kentucky School District Finance Corp. 270,000 4.500%, 07/01/21 MBIA Insured Aaa/NR 275,756 470,000 4.500%, 07/01/22 MBIA Insured Aaa/NR 480,772 785,000 4.500%, 07/01/23 MBIA Insured Aaa/NR 801,736 Lexington-Fayette Urban County, Kentucky Government Project Transylvania University 1,320,000 5.125%, 08/01/18 MBIA Insured Aaa/AAA 1,367,071 Lexington-Fayette Urban County, Kentucky Government Project U.K. Library 725,000 5.000%, 11/01/15 MBIA Insured Aaa/AAA 759,307 300,000 5.000%, 11/01/20 MBIA Insured Aaa/AAA 313,272 Louisville & Jefferson County, Kentucky University of Louisville 500,000 5.000%, 06/01/19 AMBAC Insured Aaa/AAA 539,680 525,000 5.000%, 06/01/20 AMBAC Insured Aaa/AAA 565,063 Magoffin County, Kentucky School District 450,000 4.250%, 08/01/25 AMBAC Insured Aaa/NR 448,245 Meade County, Kentucky School District 490,000 4.250%, 09/01/26 MBIA Insured Aaa/NR 486,727 Oldham County, Kentucky School District Finance Corp. 900,000 5.000%, 05/01/19 MBIA Insured Aaa/NR 963,756 Scott County, Kentucky School Building 100,000 5.000%, 03/01/22 Aa3/NR 105,674 Scott County, Kentucky School District Finance Corp. 1,115,000 4.200%, 01/01/22 AMBAC Insured Aaa/NR 1,129,685 1,955,000 4.250%, 01/01/23 AMBAC Insured Aaa/NR 1,984,814 1,560,000 4.300%, 01/01/24 AMBAC Insured Aaa/NR 1,585,912 200,000 5.000%, 06/01/24 FSA Insured Aaa/NR 212,934 Spencer County, Kentucky School District Finance Corp. 1,415,000 5.000%, 07/01/19 FSA insured Aaa/NR 1,517,092 University Kentucky General Receipts 885,000 4.500%, 10/01/22 XLCA Insured Aaa/AAA 902,134 1,545,000 4.500%, 10/01/23 XLCA Insured Aaa/AAA 1,572,393 1,625,000 4.500%, 10/01/25 XLCA Insured Aaa/AAA 1,647,214 1,010,000 4.500%, 10/01/26 XLCA Insured Aaa/AAA 1,022,170 University of Kentucky Revenue 1,335,000 5.000%, 05/01/16 FGIC Insured (pre-refunded) Aaa/AAA 1,399,881 505,000 5.000%, 06/01/18 FSA insured Aaa/NR 527,947 Warren County, Kentucky School District Finance Corp. 295,000 4.125%, 02/01/23 MBIA Insured Aaa/NR 294,811 ------------ Total Schools 72,913,707 ------------ Transportation (10.6%) ---------------------------------------------------------- Kenton County, Kentucky Airport Board Airport Revenue 1,570,000 5.000%, 03/01/13 MBIA Insured AMT Aaa/AAA 1,662,473 750,000 5.625%, 03/01/14 MBIA Insured AMT Aaa/AAA 812,505 1,000,000 5.500%, 03/01/17 MBIA Insured AMT Aaa/AAA 1,082,840 2,230,000 5.500%, 03/01/18 MBIA Insured AMT Aaa/AAA 2,408,199 1,300,000 5.000%, 03/01/23 MBIA Insured AMT Aaa/AAA 1,351,194 Kentucky Interlocal School Transportation Authority 145,000 5.400%, 06/01/17 Aa3/A+ 145,808 400,000 6.000%, 12/01/20 Aa3/A+ 403,532 200,000 6.000%, 12/01/20 Aa3/A+ 201,766 300,000 5.800%, 12/01/20 Aa3/A+ 302,556 400,000 5.650%, 12/01/20 Aa3/A+ 403,312 350,000 5.600%, 12/01/20 Aa3/A+ 352,873 Kentucky State Turnpike Authority Economic Development & Resource Recovery Road Revenue 1,000,000 5.625%, 07/01/12 FSA Insured (pre-refunded) Aaa/AAA 1,080,570 200,000 5.625%, 07/01/13 FSA Insured (pre-refunded) Aaa/AAA 216,114 500,000 5.625%, 07/01/14 FSA Insured (pre-refunded) Aaa/AAA 540,285 450,000 5.250%, 07/01/15 FSA Insured (pre-refunded) Aaa/AAA 479,669 3,455,000 5.100%, 07/01/18 FSA Insured Aaa/AAA 3,643,401 Louisville-Jefferson County Regional Airport, Kentucky 2,000,000 5.750%, 07/01/15 FSA Insured AMT Aaa/AAA 2,178,920 2,000,000 5.500%, 07/01/15 FSA Insured AMT Aaa/AAA 2,181,780 1,650,000 5.750%, 07/01/17 FSA Insured AMT Aaa/AAA 1,790,134 1,000,000 5.250%, 07/01/18 FSA Insured AMT Aaa/AAA 1,065,860 1,000,000 5.000%, 07/01/18 FSA Insured AMT Aaa/AAA 1,028,830 1,370,000 5.250%, 07/01/21 FSA Insured AMT Aaa/AAA 1,453,611 3,390,000 5.250%, 07/01/22 FSA Insured AMT Aaa/AAA 3,592,790 275,000 5.375%, 07/01/23 FSA Insured AMT Aaa/AAA 291,123 500,000 5.000%, 07/01/25 MBIA Insured AMT Aaa/AAA 514,245 ------------ Total Transportation 29,184,390 ------------ Utilities (12.2%) ---------------------------------------------------------- Bardstown, Kentucky 200,000 5.000%, 12/01/19 MBIA Insured Aaa/NR 211,722 Boone County, Kentucky Pollution Control Rev. - Dayton Power & Light 1,000,000 4.700%, 01/01/28 FGIC Insured Aaa/AAA 1,029,560 Campbell & Kenton Counties, Kentucky Sanitation Sewer District 100,000 5.000%, 08/01/24 FSA Insured Aaa/AAA 104,827 Kentucky Rural Water Finance Corp. 205,000 4.250%, 08/01/19 MBIA Insured NR/AAA 208,120 595,000 5.000%, 02/01/20 AMBAC Insured Aaa/AAA 629,540 210,000 4.250%, 08/01/20 MBIA Insured NR/AAA 212,516 200,000 4.375%, 08/01/22 MBIA Insured NR/AAA 203,428 240,000 4.500%, 08/01/23 MBIA Insured NR/AAA 246,125 200,000 4.500%, 02/01/24 MBIA Insured NR/AAA 204,028 255,000 4.500%, 08/01/24 MBIA Insured NR/AAA 260,888 290,000 4.500%, 08/01/27 MBIA Insured NR/AAA 295,293 245,000 4.600%, 08/01/28 MBIA Insured NR/AAA 251,025 315,000 4.625%, 08/01/29 MBIA Insured NR/AAA 322,862 Lexington-Fayette Urban County Government, Kentucky Sewer System 1,000,000 5.000%, 07/01/19 Aa3/AA 1,058,140 Louisville & Jefferson County, Kentucky Metropolitan Sewer District 1,000,000 5.000%, 05/15/12 FGIC Insured Aaa/AAA 1,032,920 2,565,000 5.375%, 05/15/17 MBIA Insured Aaa/AAA 2,790,925 2,180,000 5.000%, 05/15/18 FSA Insured Aaa/AAA 2,357,234 2,380,000 4.250%, 05/15/20 FSA Insured Aaa/AAA 2,405,609 2,510,000 4.250%, 05/15/21 FSA Insured Aaa/AAA 2,531,561 400,000 5.000%, 05/15/22 FGIC Insured Aaa/AAA 411,576 Louisville, Kentucky Waterworks Board Water System Revenue 1,000,000 5.250%, 11/15/16 FSA Insured Aaa/AAA 1,063,320 1,000,000 5.250%, 11/15/17 FSA Insured Aaa/AAA 1,062,140 2,530,000 5.250%, 11/15/18 FSA Insured Aaa/AAA 2,685,215 6,600,000 5.250%, 11/15/22 FSA Insured++ Aaa/AAA 6,991,974 2,415,000 5.250%, 11/15/24 FSA Insured Aaa/AAA 2,558,427 Northern Kentucky Water District 660,000 5.000%, 02/01/23 FGIC Insured Aaa/NR 690,367 Owensboro, Kentucky Electric and Power 1,555,000 5.000%, 01/01/20 FSA Insured Aaa/AAA 1,612,675 -------------- Total Utilities 33,432,017 -------------- Total Revenue Bonds 272,767,360 ------------ Total Investments (cost $274,549,591**) 102.7% 282,331,487 Other assets less liabilities (2.7) (7,447,276) -------------------------------------- Net Assets 100.0% $ 274,884,211 ====================================== Percent of Portfolio Distribution By Quality Rating (unaudited) Portfolio ---------------------------------------------------- --------- Aaa of Moody's or AAA of S&P 81.0 % Aa of Moody's or AA of S&P 16.6 A of Moody's or S&P 2.4 --------------------- 100.0 % =====================
* Any security not rated (NR) by either credit rating service has been determined by the Manager to have sufficient quality to be ranked in the top four credit ratings if a credit rating was to be assigned by a rating service. ** See note b. + Security traded on a "when-issued" basis. ++ Security pledged as collateral for the Fund's when - issued commitments. PORTFOLIO ABBREVIATIONS: -------------------------------------------------------- AMBAC - American Municipal Bond Assurance Corp. AMT - Alternative Minimum Tax CIFG -CDC IXIS Financial Guaranty ETM - Escrowed To Maturity FGIC - Financial Guaranty Insurance Co. FSA - Financial Security Assurance LOC - Letter of Credit MBIA - Municipal Bond Investors Assurance NR - Not Rated XLCA - XL Capital Assurance See accompanying notes to financial statements. NOTES TO FINANCIAL STATEMENTS CHURCHILL TAX-FREE FUND OF KENTUCKY (a) Securities valuation policies and other investment related disclosures are hereby incorporated by reference in the annual and semi-annual reports previously filed with the Securities and Exchange Commission on Form N-CSR. (b) At September 30, 2006, the net unrealized appreciation on investments, based on cost for federal income tax purposes of $274,531,656 amounted to $7,799,831, which consisted of aggregate gross unrealized appreciation of $7,806,145 and aggregate gross unrealized depreciation of $6,314. Item 2. Controls and Procedures. (a) The Fund's principal financial and executive officers have evaluated the Fund's disclosure controls and procedures within 90 days of this filing and have concluded that the Fund's disclosure controls and procedures were effective, as of this date, in ensuring that information required to be disclosed by the Fund in this Form N-Q was timely recorded, processed, summarized and reported. (b) The Fund's principal chief financial and executive officers are aware of no change in the Fund's internal control over financial reporting that occurred during the Fund's latest fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Fund's internal control over financial reporting. Item 3. Exhibits. Filed as exhibits as part of this Form are separate certifications for each principal financial and executive officer of the registrant as required by Rule 30a-2(a) under the Act(17 CFR 270.30a-2(a)). 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. CHURCHILL TAX-FREE TRUST By: /s/ Diana P. Herrmann ------------------------------- Diana P. Herrmann President and Trustee November 27, 2006 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ Diana P. Herrmann --------------------------------- Diana P. Herrmann President and Trustee November 27, 2006 By: /s/ Joseph P. DiMaggio ----------------------------------- Chief Financial Officer and Treasurer November 27, 2006