-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, KKz2ur65wfBTwqFMlyodET1FOfKDfEmQzkNpQwkeQWP3dKly098QVyYBqSBppt8g rgDklenFb1dohx9D37/HUw== 0000950137-04-007344.txt : 20040830 0000950137-04-007344.hdr.sgml : 20040830 20040830143917 ACCESSION NUMBER: 0000950137-04-007344 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 4 CONFORMED PERIOD OF REPORT: 20040630 FILED AS OF DATE: 20040830 DATE AS OF CHANGE: 20040830 EFFECTIVENESS DATE: 20040830 FILER: COMPANY DATA: COMPANY CONFORMED NAME: VAN KAMPEN MUNICIPAL INCOME TRUST CENTRAL INDEX KEY: 0000818305 IRS NUMBER: 366866160 STATE OF INCORPORATION: MA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-05230 FILM NUMBER: 041005061 BUSINESS ADDRESS: STREET 1: VAN KAMPEN INVESTMENTS INC. STREET 2: 1221 AVENUE OF THE AMERICAS CITY: NEW YORK STATE: NY ZIP: 10020 BUSINESS PHONE: 2127625441 MAIL ADDRESS: STREET 1: VAN KAMPEN INVESTMENTS INC. STREET 2: 1221 AVENUE OF THE AMERICAS CITY: NEW YORK STATE: NY ZIP: 10020 FORMER COMPANY: FORMER CONFORMED NAME: VAN KAMPEN AMERICAN CAPITAL MUNICIPAL INCOME TRUST DATE OF NAME CHANGE: 19960102 FORMER COMPANY: FORMER CONFORMED NAME: VAN KAMPEN MERRITT MUNICIPAL INCOME TRUST DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: VAN KAMPEN MERRITT XEROX INSURED MUNIFUND DATE OF NAME CHANGE: 19880824 N-CSR 1 c86777nvcsr.txt ANNUAL REPORT ------------------------- OMB APPROVAL ------------------------- OMB Number: 3235-0570 Expires: October 31, 2006 Estimated average burden hours per response: 19.3 ------------------------- 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 811-5320 Van Kampen Municipal Income Trust ___________________________________________________________________________ (Exact name of registrant as specified in charter) 1221 Avenue of the Americas New York, New York 10020 ___________________________________________________________________________ (Address of principal executive offices) (Zip code) Ronald Robison 1221 Avenue of the Americas New York, New York 10020 ___________________________________________________________________________ (Name and address of agent for service) Registrant's telephone number, including area code: 212-762-4000 Date of fiscal year end: 6/30 Date of reporting period: 6/30/04 Item 1. Report to Shareholders. The Trust's annual report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940 is as follows: Welcome, Shareholder In this report, you'll learn about how your investment in Van Kampen Municipal Income Trust performed during the annual period. The portfolio management team will provide an overview of the market conditions and discuss some of the factors that affected investment performance during the reporting period. In addition, this report includes the trust's financial statements and a list of trust investments as of June 30, 2004. Market forecasts provided in this report may not necessarily come to pass. There is no assurance that the trust will achieve its investment objective. Trusts are subject to market risk, which is the possibility that the market values of securities owned by the trust will decline and that the value of trust shares may therefore be less than what you paid for them. Accordingly, you can lose money investing in this trust. Income may subject certain individuals to the federal Alternative Minimum Tax (AMT).
--------------------------------------------------------------------------------------- NOT FDIC INSURED OFFER NO BANK GUARANTEE MAY LOSE VALUE --------------------------------------------------------------------------------------- NOT INSURED BY ANY FEDERAL GOVERNMENT AGENCY NOT A DEPOSIT ---------------------------------------------------------------------------------------
Performance Summary as of 6/30/04
MUNICIPAL INCOME TRUST SYMBOL: VMT - --------------------------------------------------------- BASED ON AVERAGE ANNUAL BASED ON MARKET TOTAL RETURNS NAV PRICE Since Inception (08/26/88) 7.91% 6.57% 10-year 7.17 4.64 5-year 7.69 4.89 1-year 0.34 -1.63 - ---------------------------------------------------------
PERFORMANCE DATA QUOTED REPRESENTS PAST PERFORMANCE, WHICH IS NO GUARANTEE OF FUTURE RESULTS, AND CURRENT PERFORMANCE MAY BE LOWER OR HIGHER THAN THE FIGURES SHOWN. FOR THE MOST RECENT MONTH-END PERFORMANCE FIGURES, PLEASE VISIT VANKAMPEN.COM OR SPEAK WITH YOUR FINANCIAL ADVISOR. INVESTMENT RETURNS, NET ASSET VALUE (NAV) AND COMMON SHARE MARKET PRICE WILL FLUCTUATE AND TRUST SHARES, WHEN SOLD, MAY BE WORTH MORE OR LESS THAN THEIR ORIGINAL COST. The NAV per share is determined by dividing the value of the trust's portfolio securities, cash and other assets, less all liabilities, by the total number of common shares outstanding. The common share market price is the price the market is willing to pay for shares of the trust at a given time. Common share market price is influenced by a range of factors, including supply and demand and market conditions. Total return assumes an investment at the beginning of the period, reinvestment of all distributions for the period in accordance with the trust's dividend reinvestment plan, and sale of all shares at the end of the period. The Lehman Brothers Municipal Bond Index is broad-based statistical composite of municipal bonds. The index does not include any expenses, fees or sales charges, which would lower performance. The index is unmanaged and should not be considered an investment. It is not possible to invest directly in an index. Source for index performance: Lipper Inc. 1 Fund Report FOR THE 12-MONTH PERIOD ENDED JUNE 30, 2004 Van Kampen Municipal Income Trust is managed by the Adviser's Municipal Fixed Income team. Current members include Thomas Byron and Robert Wimmel, Vice Presidents of the Adviser; and John Reynoldson, Executive Director of the Adviser.(1) MARKET CONDITIONS The municipal-bond market continued to be volatile during the review period, driven by investors' widely varying expectations for the state of the economy. The period began with yields rising rapidly in the third quarter of 2003 on fears that the long-term period of low interest rates was likely to come to an end. Those fears abated somewhat in the fourth quarter of 2003 when it became apparent that employment growth remained anemic, thus easing the inflationary pressures that might otherwise induce the Federal Reserve Bank's Federal Open Market Committee (the Fed) to raise the target federal funds rate. Yields remained low through the first quarter of 2004 until April, when a surprisingly strong employment report for March spooked investors. This report, coupled with sustained high commodity (especially oil) prices, led the market to factor in a far more rapid rate hike by the Fed than had previously been expected. Yields continued to rise in May, when it became clear that most investors expected the Fed to act at its June 30, 2004 meeting. It did so, raising the federal funds rate by 25 basis points--the first rate hike since 2000. Supply of new municipal bonds in calendar 2003 hit record levels as municipalities moved to take advantage of historically low interest rates. Many cities and states moved to reduce expenditures by refinancing existing debt and replacing it with lower-yielding bonds. In other cases, municipalities attempted to meet current and future funding needs by issuing new debt. This activity slowed in 2004, though California continued to lead the nation in issuance thanks to its $11 billion deficit financing. The low interest rates that prevailed over much of the period also had an impact on the demand for municipal bonds. Retail and institutional investor activity slowed as holders of municipal bonds saw little reason to sell bonds purchased at higher yield levels and reinvest at historically low yields. However, the period was marked by rising activity among non-traditional investors, such as hedge funds and insurance companies seeking to take advantage of the attractiveness of municipal bonds relative to taxable securities. Additionally, investors' search for yield led to significant outperformance by lower-rated bonds with greater credit risk. Sectors such as health care, with a preponderance of lower-rated issues, performed particularly well. (1)Team members may change without notice at any time. 2 PERFORMANCE ANALYSIS Closed-end fund returns can be calculated upon either the market price or the net asset value (NAV) of its shares. NAV per share is determined by dividing the value of the trust's portfolio securities, cash and other assets, less all liabilities, by the total number of common shares outstanding, while market price reflects the supply and demand for the shares. As a result, the two returns can differ significantly. On both an NAV basis and a market-price basis, the trust underperformed its benchmark, the Lehman Brothers Municipal Bond Index. (See table below.) The trust often uses leverage to enhance its dividend to common shareholders. The trust borrows money at short-term rates through the issuance of preferred shares. The proceeds are typically reinvested in longer-term securities, taking advantage of the difference between short- and longer-term rates. With short- term rates at historic lows for much of the period, the difference between short and longer-term rates was relatively high. This made using leverage a beneficial approach during the period, and added to the trust's returns. As yields rose toward the end of the period, the prices of bonds declined. The trust's use of leverage magnified this negative price movement, which contributed to the portfolio's underperformance versus the benchmark, which is not leveraged. One of our primary strategies in managing the trust was to keep its duration (a measure of interest-rate sensitivity) below that of the benchmark. This posture was driven by a combination of our analysis of the macroeconomic environment as well as the level of interest rates, which for most of the period hovered at or near multi-decade lows. The combination of an improving economy and low interest rates led us to anticipate that the next significant shift in rates would likely be upward, and as a result would be more damaging for longer-duration paper. The portfolio's below-market interest-rate sensitivity hampered the trust's performance for most of the period as interest rates edged downward more often than they rose. That said, the approach was more beneficial in the final months of the period as interest rates rose in anticipation of the Fed's June 30(th) meeting, and the trust ended the period well-positioned for widely anticipated further rate increases. The trust's performance was also modestly hampered by its relatively high quality bias. Municipal-bond investors during the period responded to the improving economy by reducing the yield spreads between higher- and TOTAL RETURN FOR THE 12-MONTH PERIOD ENDED JUNE 30, 2004
- --------------------------------------------------------------- BASED ON BASED ON LEHMAN BROTHERS MUNICIPAL NAV MARKET PRICE BOND INDEX 0.34% -1.63% 0.76% - ---------------------------------------------------------------
Past performance is no guarantee of future results. Investment return, net asset value and common share market price will fluctuate and trust shares, when sold, may be worth more or less than their original cost. See Performance Summary for additional performance information and index definition. 3 lower-rated bonds (yield spreads reflect the premium demanded by investors to buy lower-rated bonds). As a result, lower-quality bonds outperformed, and the trust's high-quality bias held back returns somewhat. At the end of the period, the portfolio had 91 percent exposure to bonds rated AA or higher, two percentage points higher than at the beginning of the trust's fiscal year. The portfolio's trading activity during the period was well below traditional norms given our desire to avoid having to reinvest into securities with low yields. However, we were able to make selective relative-value trades among securities and sectors as they moved into and out of fair value. Many of these acquisitions were funded by the proceeds of bonds that were called away by their issuers during the period as a result of the low interest-rate environment. In other cases we sold bonds that met our performance objectives during the period. We reinvested this cash into securities that we believed had more promising total-return characteristics, especially those in the intermediate portion of the yield curve. Many of the intermediate securities we identified offered premium coupons. We also selectively added to the portfolio's holdings of longer-maturity paper that we believed would meet with strong retail demand in the near future. The trust's portfolio remained well diversified during the period, with its holdings spread across all major municipal bond sectors. This longstanding strategy can help to minimize the risk of over-concentration in any single sector, while also giving the portfolio exposure to many potential sources of return. The three largest sector exposures at the end of the period were general purpose at 20 percent of long-term investments, public building at 13 percent, and transportation at 11 percent. As mentioned above, the portfolio's below-market duration served it well when interest rates rose sharply in the final weeks of the period. While it is impossible to forecast with certainty how far interest rates are likely to rise, we do believe that the coming months are likely to offer significantly more opportunities to invest in securities with more attractive yield characteristics. TOP 5 SECTORS AS OF 6/30/04 RATING ALLOCATIONS AS OF 6/30/04 General Purpose 20.2% AAA/Aaa 83.1% Public Building 13.1 AA/Aa 7.7 Transportation 11.2 A/A 3.7 Water & Sewer 10.0 BBB/Baa 3.2 Public Education 9.6 Non-Rated 2.3
Subject to change daily. All percentages are as a percentage of long-term investments. Provided for informational purposes only and should not be deemed as a recommendation to buy securities in the sectors shown above. Securities are classified by sectors that represent broad groupings of related industries. Ratings allocation based upon ratings as issued by Standard and Poor's and Moody's, respectively. Van Kampen is a wholly owned subsidiary of a global securities firm which is engaged in a wide range of financial services including, for example, securities trading and brokerage activities, investment banking, research and analysis, financing and financial advisory services. 4 FOR MORE INFORMATION ABOUT PORTFOLIO HOLDINGS Each Van Kampen trust provides a complete schedule of portfolio holdings in its semiannual and annual reports within 60 days of the end of the trust's second and fourth fiscal quarters by filing the schedule electronically with the Securities and Exchange Commission (SEC). The semiannual reports are filed on Form N-CSRS and the annual reports are filed on Form N-CSR. Van Kampen also delivers the semiannual and annual reports to trust shareholders, and makes these reports available on its public web site, www.vankampen.com. In addition to the semiannual and annual reports that Van Kampen delivers to shareholders and makes available through the Van Kampen public web site, each fund files a complete schedule of portfolio holdings with the SEC for the trust's first and third fiscal quarters on Form N-Q. Van Kampen does not deliver the reports for the first and third fiscal quarters to shareholders, nor are the reports posted to the Van Kampen public web site. You may, however, obtain the Form N-Q filings (as well as the Form N-CSR and N-CSRS filings) by accessing the SEC's web site, http://www.sec.gov. You may also review and copy them at the SEC's Public Reference Room in Washington, DC. Information on the operation of the SEC's Public Reference Room may be obtained by calling the SEC at 1-202-942-8090. You can also request copies of these materials, upon payment of a duplicating fee, by electronic request at the SEC's e-mail address (publicinfo@sec.gov) or by writing the Public Reference section of the SEC, Washington, DC 20549-0102. In addition to filing a complete schedule of portfolio holdings with the SEC each fiscal quarter, each Van Kampen trust makes portfolio holdings information available by periodically providing the information on its public web site, www.vankampen.com. Each Van Kampen trust provides a complete schedule of portfolio holdings on the public web site on a calendar-quarter basis approximately 30 days after the close of the calendar quarter. Furthermore, each Van Kampen trust provides partial lists of its portfolio holdings (such as top 10 or top 15 trust holdings) to the public web site each with a delay of approximately 15 days. You may obtain copies of a trust's fiscal quarter filings, or its monthly or calendar-quarter web site postings, by contacting Van Kampen Client Relations at 1-800-847-2424. PROXY VOTING POLICIES AND PROCEDURES AND PROXY VOTING RECORD The trust's policies and procedures with respect to the voting of proxies relating to the trust's portfolio securities and information on how the trust voted proxies relating to portfolio securities during the most recent twelve-month period ended June 30 is available without charge, upon request, by calling 1-800-847-2424 or by visiting our web site at www.vankampen.com. This information is also available on the Securities and Exchange Commission's web site at http://www.sec.gov. 5 VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- MUNICIPAL BONDS 155.4% ALABAMA 2.0% $3,660 Alabama St Brd Ed Rev & Impt Southn Univ St Cmnty Rfdg (MBIA Insd)................. 5.250% 07/01/20 $ 3,845,562 1,865 Alabama St Univ Rev Gen Tuit & Fee Ser B (MBIA Insd)............................... 5.250 03/01/33 1,892,453 ------------- 5,738,015 ------------- ALASKA 1.9% 3,650 Alaska St Intl Arpt Rev Ser B (AMBAC Insd)..................................... 5.250 10/01/27 3,684,492 1,575 Matanuska-Susitna Boro, AK Ctf Part Pub Safety Bldg Lease (FSA Insd).............. 5.750 03/01/16 1,724,767 ------------- 5,409,259 ------------- ARIZONA 1.4% 1,000 Arizona Hlth Fac Auth Hosp John C Lincoln Hlth Network.............................. 6.375 12/01/37 1,021,930 3,000 Arizona St Trans Brd Excise Tax Maricopa Cnty Regl Area Rd Fd...................... 5.500 07/01/04 3,000,360 ------------- 4,022,290 ------------- CALIFORNIA 10.7% 4,500 California St (AMBAC Insd)................ 5.125 10/01/27 4,506,435 1,000 California St Dept Wtr Res Ctr Wtr Sys Ser X (FGIC Insd)............................. 5.000 12/01/29 992,140 1,000 California St Dept Wtr Res Pwr Ser A...... 6.000 05/01/15 1,108,050 1,000 California St Dept Wtr Res Pwr Ser A (AMBAC Insd).............................. 5.500 05/01/16 1,087,960 2,500 California St Dept Wtr Res Pwr Ser A (AMBAC Insd) (a).......................... 5.375 05/01/18 2,668,200 5,000 California St Univ Rev & Co Systemwide Ser A (AMBAC Insd)............................ 5.000 11/01/33 4,920,250 5,000 Contra Costa, CA Home Mtg Fin Auth Home Mtg Rev (Escrowed to Maturity) (MBIA Insd)..................................... * 09/01/17 2,551,950 4,000 Los Angeles, CA Dept Wtr & Pwr Ser A (FGIC Insd)..................................... 5.125 07/01/40 3,973,320 2,500 Los Angeles, CA Uni Sch Dist Ser A (FSA Insd)..................................... 5.250 07/01/20 2,627,150 2,000 Los Angeles, CA Wtr & Pwr Rev Pwr Sys Ser B (FSA Insd).............................. 5.000 07/01/28 1,982,060 1,500 Metropolitan Wtr Dist Southn CA Auth Ser B 1 (FGIC Insd)............................. 5.000 10/01/33 1,480,575 1,750 Palm Springs, CA Fin Auth Lease Rev Convention Ctr Proj Ser A (MBIA Insd)..... 5.500 11/01/35 1,835,470 1,000 Santa Clara Cnty, CA Brd Ed Rfdg (MBIA Insd)..................................... 5.000 04/01/25 999,030 ------------- 30,732,590 -------------
6 See Notes to Financial Statements VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- COLORADO 3.1% $1,000 Arapahoe Cnty, CO Cap Impt Tr Fd Hwy Rev E-470 Proj Ser B (Prerefunded @ 08/31/05)................................. 6.950% 08/31/20 $ 1,090,210 1,500 Arapahoe Cnty, CO Cap Impt Tr Fd Hwy Rev E-470 Proj Ser B (Prerefunded @ 08/31/05)................................. 7.000 08/31/26 1,636,170 3,405 Colorado Ed & Cultural Fac Impt Charter Sch Rfdg (XLCA Insd)...................... 5.250 12/01/23 3,495,198 550 Colorado Hlth Fac Auth Rev Catholic Hlth Initiatives............................... 5.250 09/01/21 557,991 1,000 Colorado Hlth Fac Auth Rev Catholic Hlth Initiatives Ser A......................... 5.500 03/01/32 1,017,750 1,000 El Paso Cnty, CO Ctf Part Detention Fac Proj Ser B (AMBAC Insd)................... 5.375 12/01/18 1,069,400 ------------- 8,866,719 ------------- CONNECTICUT 1.0% 1,750 Connecticut St Spl Oblig Pkg Rev Bradley Intl Arpt Ser A (ACA Insd) (AMT).......... 6.600 07/01/24 1,837,430 1,000 Hartford, CT Pkg Sys Rev Ser A............ 6.500 07/01/25 1,024,890 ------------- 2,862,320 ------------- DISTRICT OF COLUMBIA 1.0% 2,775 District of Columbia Hosp Rev Medlantic Hlthcare Ser A Rfdg (Escrowed to Maturity) (MBIA Insd)............................... 5.250 08/15/12 2,979,906 ------------- FLORIDA 9.0% 2,000 Escambia Cnty, FL Hlth Fac Auth Rev (AMBAC Insd)..................................... 5.950 07/01/20 2,079,800 1,000 Florida St Brd Ed Lottery Rev Ser A (FGIC Insd)..................................... 5.750 07/01/11 1,123,210 2,000 Florida St Dept Environmental Prot Preservtn Rev Ser A (FGIC Insd)........... 5.750 07/01/10 2,253,840 1,745 Hillsborough Cnty, FL Port Dist Tampa Port Auth Proj Ser A (MBIA Insd)............... 5.375 06/01/27 1,773,356 1,000 Jea, FL Elec Sys Rev Ser 3 Ser A.......... 5.500 10/01/41 1,018,090 1,000 Marion Cnty, FL Sch Brd Ctf (FSA Insd).... 5.250 06/01/18 1,061,730 1,500 Miami Beach, FL Stormwtr Rev (FGIC Insd)..................................... 5.250 09/01/25 1,531,770 1,720 Miami-Dade Cnty, FL Aviation Rev Miami Intl Arpt (FGIC Insd)..................... 5.375 10/01/32 1,733,536 3,000 Orange Cnty, FL Sch Brd Ctf Part Ser A (AMBAC Insd).............................. 5.250 08/01/14 3,267,510 4,000 Orange Cnty, FL Tourist Dev Tax Rev (AMBAC Insd)..................................... 5.625 10/01/14 4,401,360 2,000 Orange Cnty, FL Tourist Dev Tax Rev (AMBAC Insd)..................................... 5.500 10/01/31 2,067,820 1,090 Plantation, FL Impt Proj Rfdg (FSA Insd)..................................... 5.000 08/15/20 1,122,547
See Notes to Financial Statements 7 VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- FLORIDA (CONTINUED) $1,190 Polk Cnty FL Util Sys Rev (FGIC Insd)..... 5.250% 10/01/20 $ 1,256,390 1,115 Tallahassee, FL Lease Rev FL St Univ Proj Ser A (MBIA Insd)......................... 5.500 08/01/19 1,204,613 ------------- 25,895,572 ------------- GEORGIA 7.4% 4,023 Fulton Cnty, GA Lease Rev (Acquired 12/23/94, Cost $4,023,144) (b)............ 7.250 06/15/10 4,240,675 2,635 Georgia Muni Elec Auth Pwr Rev Ser A (MBIA Insd)..................................... 6.500 01/01/20 3,197,125 3,000 Georgia Muni Elec Auth Pwr Rev Ser B Rfdg (FGIC Insd)............................... 6.250 01/01/17 3,537,270 2,500 Georgia St Ser D.......................... 6.000 10/01/05 2,630,850 2,335 Georgia St Ser D.......................... 6.000 10/01/06 2,527,007 2,000 Municipal Elec Auth GA Combustion Turbine Proj Ser A (MBIA Insd).................... 5.250 11/01/22 2,075,720 800 Royston, GA Hosp Auth Hosp Rev Ctf Hlthcare Sys Inc.......................... 6.700 07/01/16 806,120 2,500 Royston, GA Hosp Auth Hosp Rev Ctf Hlthcare Sys Inc.......................... 6.500 07/01/27 2,427,500 ------------- 21,442,267 ------------- ILLINOIS 17.4% 4,000 Chicago, IL Brd Ed Chicago Sch Reform Ser A (AMBAC Insd)............................ 5.250 12/01/27 4,039,600 1,400 Chicago, IL Brd Ed Ser A (MBIA Insd)...... 5.500 12/01/28 1,452,276 2,250 Chicago, IL Neighborhoods Alive 21 Ser A (FGIC Insd)............................... 5.500 01/01/13 2,470,860 1,500 Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third Lien C-2 Rfdg (FSA Insd) (AMT)...... 5.250 01/01/30 1,490,610 1,500 Chicago, IL O'Hare Intl Arpt Rev Gen Arpt Third Lien C-2 Rfdg (XLCA Insd) (AMT)..... 5.250 01/01/34 1,487,760 1,000 Chicago, IL O'Hare Intl Arpt Rev Second Lien Passenger Fac Ser B (AMBAC Insd)..... 5.500 01/01/16 1,076,500 1,000 Chicago, IL Proj Ser C Rfdg (FGIC Insd)... 5.750 01/01/14 1,111,940 1,000 Chicago, IL Proj Ser C Rfdg (FGIC Insd)... 5.750 01/01/15 1,108,070 4,895 Chicago, IL Pub Bldg Comm Bldg Rev Ser A (Escrowed to Maturity) (MBIA Insd)........ * 01/01/07 4,568,210 1,000 Chicago, IL Ser B Rfdg (AMBAC Insd)....... 5.125 01/01/15 1,069,400 2,000 Chicago, IL Wastewtr Transmission Rev Second Lien (MBIA Insd)................... 5.750 01/01/25 2,131,900 1,960 Cook Cnty, IL Cmnty Cons Sch Dist (FSA Insd)..................................... 5.500 12/01/13 2,185,851 1,000 Cook Cnty, IL Ser A (FGIC Insd)........... 5.500 11/15/31 1,036,080 3,230 Cook Cnty, IL Ser A Rfdg (MBIA Insd)...... 5.625 11/15/16 3,507,166 2,310 Illinois Dev Fin Auth Rev Adventist Hlth Ser A (MBIA Insd)......................... 5.500 11/15/13 2,544,396
8 See Notes to Financial Statements VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- ILLINOIS (CONTINUED) $2,500 Illinois Dev Fin Auth Rev Adventist Hlth Ser A (MBIA Insd)......................... 5.500% 11/15/15 $ 2,728,675 1,335 Illinois Dev Fin Auth Rev Bradley Univ Proj (Prerefunded @ 08/01/09) (AMBAC Insd)..................................... 5.375 08/01/24 1,481,476 2,000 Illinois Ed Fac Auth Rev Lewis Univ....... 6.125 10/01/26 1,902,020 1,500 Illinois St First Ser (FGIC Insd)......... 5.375 11/01/14 1,633,215 1,900 Kendall, Kane & Will Cntys, IL Cmnty Unit Sch Dist No. 308 Ser B (FGIC Insd)........ 5.250 10/01/21 1,975,278 2,500 Metropolitan Pier & Expo Auth IL Dedicated St Tax Rev McCormick Pl Expn Ser A (MBIA Insd)..................................... 5.250 06/15/42 2,506,125 1,250 Sangamon Cnty, IL Ctf Part................ 10.000 12/01/06 1,460,675 7,455 Will Cnty, IL Fst Presv Dist Ser B (FGIC Insd)..................................... * 12/01/12 5,207,988 ------------- 50,176,071 ------------- INDIANA 3.4% 2,420 Brownsburg, IN Sch Bldg Corp First Mtg Brownsburg Cmnty Sch (MBIA Insd).......... 5.550 02/01/24 2,532,603 1,000 Clark Pleasant, IN Cmnty Sch First Mtg (AMBAC Insd).............................. 5.500 07/15/18 1,082,870 4,000 Indiana Hlth Fac Fin Auth Rev Deaconess Hosp Ser A (AMBAC Insd)................... 5.375 03/01/34 4,060,880 2,000 Indiana Trans Fin Auth Toll Rfdg (AMBAC Insd)..................................... 5.375 07/01/09 2,148,260 ------------- 9,824,613 ------------- KANSAS 2.7% 3,810 Kansas St Dev Fin Auth Rev KS Proj Ser N (AMBAC Insd).............................. 5.250 10/01/22 3,939,845 1,250 Kansas St Dev Fin Auth Rev KS St Proj (AMBAC Insd).............................. 5.500 03/01/16 1,358,737 2,235 Sedgwick Cnty, KA Uni Sch Dist No. 259 Wichita (MBIA Insd)....................... 5.500 09/01/11 2,468,334 ------------- 7,766,916 ------------- KENTUCKY 3.5% 2,190 Kenton Cnty, KY Arpt Brd Rev Cincinnati/Northn KY Intl Arpt Ser A Rfdg (MBIA Insd) (AMT)......................... 6.250 03/01/09 2,422,841 5,000 Kentucky St Ppty & Bldgs Commn Proj No. 74 Rfdg (Prerefunded 02/01/12) (FSA Insd).... 5.375 02/01/16 5,541,700 2,000 Kentucky St Tpk Auth Econ Dev Revitalization Proj Rfdg (FSA Insd)....... 5.500 07/01/07 2,165,600 ------------- 10,130,141 -------------
See Notes to Financial Statements 9 VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- LOUISIANA 3.2% $4,395 Ernest N Morial New Orleans LA Sr Sub Ser A (AMBAC Insd)............................ 5.250% 07/15/22 $ 4,566,361 3,000 Lafayette, LA Util Rev (MBIA Insd) (c).... 5.250 11/01/21 3,122,610 1,500 Louisiana St Ser A (FGIC Insd)............ 5.500 11/15/08 1,649,400 ------------- 9,338,371 ------------- MARYLAND 0.9% 2,180 Baltimore, MD Cap Apprec Ser A (FGIC Insd)..................................... * 10/15/09 1,669,945 1,000 Maryland St Hlth & Higher Ed Fac Auth Rev Medstar Hlth Rfdg......................... 5.500 08/15/33 950,580 ------------- 2,620,525 ------------- MASSACHUSETTS 4.3% 2,305 Massachusetts St College Bldg Auth Proj Rev Ser A (MBIA Insd)..................... 5.000 05/01/20 2,372,560 4,000 Massachusetts St Cons Ln Ser B (Prerefunded @ 03/01/12) (FSA Insd)....... 5.500 03/01/17 4,418,280 1,500 Massachusetts St Fed Hwy Gnt Antic Nt Ser A......................................... 5.750 06/15/15 1,679,025 1,000 Massachusetts St Indl Fin Agy Rev Higher Ed Hampshire College Proj (Prerefunded @ 10/01/07)................................. 5.625 10/01/12 1,042,300 2,000 Massachusetts St Spl Oblig Dedicated Tax Rev (FGIC Insd)........................... 5.000 01/01/34 1,971,160 1,000 Massachusetts St Wtr Res Auth Gen Ser A (MBIA Insd)............................... 5.000 08/01/28 989,600 ------------- 12,472,925 ------------- MICHIGAN 2.8% 1,000 Grand Rapids, MI Wtr Supply Sys Rfdg (FGIC Insd)..................................... 5.750 01/01/13 1,114,770 1,180 Hillsdale, MI Hosp Fin Auth Hosp Rev Hillsdale Cmnty Hlth Ctr.................. 5.750 05/15/18 1,173,781 1,000 Michigan Muni Bd Auth Rev Clean Wtr Rev Fd........................................ 5.250 10/01/18 1,065,490 1,000 Michigan St Strategic Fd Detroit Edison Co Proj C Rfdg (XLCA Insd) (AMT)............. 5.450 12/15/32 1,013,490 2,500 Michigan St Strategic Fd Detroit Edison Conv Rfdg (Variable Rate Coupon) (AMBAC Insd)..................................... 4.850 09/01/30 2,617,700 1,000 Michigan St Strategic Fd Detroit Edison Pollutn Ctl Ser B Rfdg (AMT).............. 5.650 09/01/29 1,003,010 ------------- 7,988,241 ------------- MISSISSIPPI 0.5% 1,500 Mississippi Hosp Equip & Fac MS Baptist Med Ctr Rfdg (MBIA Insd).................. 6.000 05/01/13 1,579,470 -------------
10 See Notes to Financial Statements VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- MISSOURI 2.7% $2,530 Bi-State Dev Agy MO IL Met Metrolink Cross Cnty Proj B (FSA Insd).................... 5.250% 10/01/18 $ 2,696,778 3,400 Missouri St Hwys & Trans Commn Rd Rev Ser A......................................... 5.500 02/01/08 3,704,742 1,250 Saint Charles, MO Ctf Part Ser B.......... 5.500 05/01/18 1,291,850 ------------- 7,693,370 ------------- NEVADA 1.5% 3,965 Clark Cnty, NV Bd Bk (FGIC Insd).......... 5.500 06/01/09 4,368,399 ------------- NEW JERSEY 2.6% 1,835 New Jersey St Ed Fac Auth Higher Ed Cap Impt Ser A (AMBAC Insd)................... 5.250 09/01/21 1,917,245 1,000 New Jersey St Trans Corp Cap Grant Antic Nt Ser B (AMBAC Insd)..................... 5.500 02/01/08 1,086,430 2,000 New Jersey St Trans Corp Ctf Fed Trans Admin Grants Ser A (AMBAC Insd)........... 5.500 09/15/13 2,230,360 2,095 New Jersey St Trans Tr Fd Auth Trans Sys Ser A..................................... 5.750 06/15/17 2,351,072 ------------- 7,585,107 ------------- NEW MEXICO 1.5% 4,000 Santa Fe, NM Gross Rcpt Tax Impt (AMBAC Insd)..................................... 5.250 06/01/13 4,357,080 ------------- NEW YORK 18.2% 3,000 Metropolitan Trans Auth NY Ser A Rfdg (AMBAC Insd).............................. 5.500 11/15/18 3,252,990 2,500 Metropolitan Trans Auth NY Ser A Rfdg (FGIC Insd)............................... 5.250 11/15/31 2,537,925 2,500 Nassau Cnty, NY Interim Fin Auth Sales Tax Secd Ser A (Prerefunded @ 11/15/10)....... 5.750 11/15/13 2,836,375 3,000 New York City Muni Fin Auth Wtr & Sew Sys Rev Ser A (AMBAC Insd).................... 5.000 06/15/35 2,956,680 5,700 New York City Muni Wtr Fin Auth Ser A (FSA Insd)..................................... 5.375 06/15/17 6,115,131 5,900 New York City Ser A....................... 7.000 08/01/04 5,927,789 4,500 New York City Ser B (AMBAC Insd).......... 7.250 08/15/07 5,091,840 445 New York City Ser C....................... 7.000 08/15/08 446,820 1,000 New York City Ser H....................... 5.750 03/15/13 1,093,800 6,930 New York City Trans Auth Trans Fac Livingston Plaza Proj Rfdg (Escrowed to Maturity) (FSA Insd)...................... 5.400 01/01/18 7,558,204 3,000 New York City Transitional Fin Auth Rev Future Tax Secd Ser A Rfdg (d)............ 5.500/14.000 11/01/26 3,301,470 3,000 New York St Dorm Auth Rev Hosp (MBIA Insd)..................................... 5.000 08/01/33 2,947,950
See Notes to Financial Statements 11 VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- NEW YORK (CONTINUED) $2,000 New York St Dorm Auth Rev Sch Dist Fin Pgm Ser D (MBIA Insd)......................... 5.500% 10/01/17 $ 2,175,680 3,000 New York St Urban Dev Corp Rev Personal Income Tax Ser C (FGIC Insd).............. 5.500 03/15/18 3,260,130 2,680 Port Auth NY & NJ Cons 119th Ser (FGIC Insd) (AMT)............................... 5.500 09/15/17 2,834,368 ------------- 52,337,152 ------------- NORTH CAROLINA 5.9% 2,000 Charlotte, NC Ctf Part Convention Fac Proj Ser A Rfdg................................ 5.500 08/01/19 2,169,640 3,000 North Carolina Eastn Muni Pwr Agy Pwr Sys Rev Ser D................................. 6.750 01/01/26 3,270,450 10,000 North Carolina Muni Pwr Agy No 1 Catawba Elec Rev Rfdg (MBIA Insd)................. 6.000 01/01/12 11,442,000 ------------- 16,882,090 ------------- OHIO 7.7% 1,000 Cleveland, OH Muni Sch Dist (FSA Insd) (c)....................................... 5.250 12/01/23 1,037,940 3,000 Columbus, OH City Sch Dist Sch Fac Constr & Impt (FSA Insd) (c)..................... 5.250 12/01/22 3,143,400 1,000 Cuyahoga Cnty, OH Hosp Fac Rev Canton Inc Proj...................................... 7.500 01/01/30 1,093,570 3,000 Franklin Cnty, OH Convention Fac Auth Tax & Lease Rev Antic Bds Rfdg (AMBAC Insd)... 5.250 12/01/19 3,166,890 2,660 Licking Heights, OH Loc Sch Dist (FGIC Insd)..................................... 5.250 12/01/23 2,767,331 1,000 Lorain Cnty, OH Hosp Rev Catholic Hlthcare.................................. 5.375 10/01/30 995,730 2,000 Lorain, OH City Sch Dist Classroom Fac Impt (MBIA Insd).......................... 5.250 12/01/20 2,118,560 1,925 Ohio Muni Elec Generation Agy Jt Venture Ctf Ben Int Rfdg (AMBAC Insd)............. 5.000 02/15/22 1,950,583 1,000 Ohio St Air Quality Dev Auth Rev JMG Fdg Ltd Part Proj Rfdg (AMBAC Insd) (AMT)..... 6.375 04/01/29 1,029,650 1,500 Ohio St Bldg Auth St Fac Admin Bldg Fd Proj A (FSA Insd)......................... 5.500 04/01/15 1,635,465 3,000 University Cincinnati OH Gen Ser A (FGIC Insd)..................................... 5.500 06/01/09 3,315,270 ------------- 22,254,389 ------------- OKLAHOMA 0.4% 1,000 Central, OK Trans & Pkg Auth Pkg Sys (AMBAC Insd).............................. 5.000 07/01/18 1,034,060 ------------- OREGON 2.5% 1,000 Clackamas Cnty, OR Sch Dist............... 5.500 06/01/10 1,113,700 1,350 Oregon Hlth Sciences Univ Insd Ser A (MBIA Insd)..................................... 5.250 07/01/22 1,403,946
12 See Notes to Financial Statements VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- OREGON (CONTINUED) $2,060 Oregon St Dept Admin Ser C Rfdg (MBIA Insd)..................................... 5.250% 11/01/17 $ 2,192,994 1,250 Portland, OR Cmnty College Dist Ser B..... 5.250 06/01/12 1,360,925 1,135 Portland, OR Swr Sys Rev Second Lien Ser A Rfdg (FSA Insd)........................... 5.250 06/01/19 1,200,773 ------------- 7,272,338 ------------- PENNSYLVANIA 8.0% 1,500 Allegheny Cnty, PA San Auth Swr (MBIA Insd)..................................... 5.500 12/01/30 1,563,780 1,000 Allegheny Cnty, PA Ser C-53 Rfdg (FGIC Insd)..................................... 5.500 11/01/14 1,099,050 1,000 Greensburg Salem, PA Sch Dist Rfdg (FGIC Insd)..................................... 5.375 09/15/15 1,084,130 2,000 Harrisburg, PA Auth Res Gtd Sub Ser D-2 (Variable Rate Coupon) (FSA Insd)......... 5.000 12/01/33 2,112,500 1,200 Harrisburg, PA Cap Apprec Nt Ser F Rfdg (AMBAC Insd).............................. * 09/15/14 757,332 4,000 Pennsylvania St Commn Tpk Rev Ser A (AMBAC Insd)..................................... 5.000 12/01/34 3,952,360 2,600 Philadelphia, PA Auth Indl Ser B (FSA Insd)..................................... 5.500 10/01/16 2,838,394 2,400 Philadelphia, PA Gas Wks Rev 1998 Gen Ordinance Fourth Ser (FSA Insd)........... 5.250 08/01/22 2,483,136 4,570 Pittsburgh, PA Ser A (AMBAC Insd)......... 5.500 09/01/16 4,881,674 2,000 Ridley Park, PA Hosp Auth Rev Taylor Hosp Ser A (Escrowed to Maturity).............. 6.000 12/01/13 2,241,560 ------------- 23,013,916 ------------- SOUTH CAROLINA 0.7% 1,000 Chesterfield Cnty, SC Sch Dist (FSA Insd)..................................... 5.375 03/01/18 1,068,800 1,000 South Carolina Jobs Econ Dev Auth Indl Rev Elec & Gas Co Proj Ser A (AMBAC Insd)..... 5.200 11/01/27 1,012,410 ------------- 2,081,210 ------------- SOUTH DAKOTA 0.3% 875 Deadwood, SD Ctf Part (ACA Insd).......... 6.375 11/01/20 917,735 ------------- TENNESSEE 1.8% 2,000 Johnson City, TN Hlth & Ed Fac Brd Hosp Rev First Mtg Mtn St Hlth Ser A Rfdg (MBIA Insd)..................................... 7.500 07/01/25 2,433,920 2,500 Memphis, TN (Prerefunded @ 10/01/06)...... 5.250 10/01/14 2,689,550 ------------- 5,123,470 ------------- TEXAS 15.0% 2,050 Austin, TX Wtr & Wastewtr Rfdg (MBIA Insd)..................................... 5.750 05/15/12 2,278,329 1,000 Austin, TX Wtr & Wastewtr Rfdg (MBIA Insd)..................................... 5.250 11/15/19 1,053,200
See Notes to Financial Statements 13 VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- TEXAS (CONTINUED) $ 750 Brazos Cnty, TX Hlth Fac Dev Oblig Grp.... 5.375% 01/01/32 $ 727,995 1,430 Cameron Cnty, TX Ctf Oblig (AMBAC Insd)... 5.750 02/15/15 1,563,519 1,500 Corpus Christi, TX Util Sys Rev Impt Rfdg (FSA Insd)................................ 5.250 07/15/19 1,573,725 2,000 Fort Worth, TX Wtr & Swr Rev Impt Rfdg.... 5.500 02/15/05 2,049,980 1,000 Harris Cnty, TX Hlth Fac Dev Mem Hermann Hlthcare Ser A............................ 6.375 06/01/29 1,082,990 2,000 Harris Cnty, TX Perm Impt & Rfdg.......... 5.000 10/01/11 2,127,780 4,820 Harris Cnty, TX Toll Rd (Prerefunded @ 08/15/09) (AMBAC Insd).................... * 08/15/18 2,166,156 1,000 Harris Cnty, TX Toll Rd (Prerefunded @ 08/15/09) (AMBAC Insd).................... * 08/15/21 365,590 2,105 Houston, TX Hotel Occupancy Tax & Spl Rev Convention & Entmt Ser B (AMBAC Insd)..... 5.750 09/01/15 2,322,868 95 Houston, TX Pub Impt Rfdg (FSA Insd)...... 5.750 03/01/15 104,631 905 Houston, TX Pub Impt Rfdg (Prerefunded 09/01/10) (FSA Insd)...................... 5.750 03/01/15 1,018,768 2,000 Houston, TX Wtr & Swr Sys Rev Jr Lien Ser B Rfdg (Escrowed to Maturity) (FGIC Insd)..................................... 6.250 12/01/05 2,122,920 1,500 Mesquite, TX Hlth Fac Dev Retirement Fac Christian A............................... 7.500 02/15/18 1,589,460 1,100 Metropolitan Hlth Fac Dev Corp TX Wilson N Jones Mem Hosp Proj....................... 7.200 01/01/21 1,067,033 1,000 North Cent TX Hlth Fac Dev Hosp Baylor Hlthcare Sys Proj Ser A................... 5.125 05/15/29 969,190 1,750 North Cent TX Hlth Fac Dev Hosp Childrens Med Ctr Dallas (AMBAC Insd)............... 5.250 08/15/32 1,756,178 2,805 Tarrant Regl Wtr Dist TX Wtr Impt Rfdg (FSA Insd)................................ 5.250 03/01/19 2,951,365 3,297 Texas Mun Pwr Agy Rev (AMBAC Insd)........ * 09/01/07 2,999,710 228 Texas Mun Pwr Agy Rev (Escrowed to Maturity) (AMBAC Insd).................... * 09/01/07 208,285 3,070 Texas St Pub Ppty Fin Corp Rev Mental Hlth & Retardation Rfdg (FSA Insd)............. 5.500 09/01/13 3,119,396 1,565 Texas St Univ Sys Fin Rev Rfdg (FSA Insd)..................................... 5.000 03/15/20 1,596,472 1,000 Texas Tech Univ Rev Fin Sys Seventh Ser (MBIA Insd)............................... 5.000 08/15/25 995,420 1,500 Texas Wtr Dev Brd Rev St Revolving Fd Sr Lien Ser B................................ 5.250 07/15/17 1,586,160 1,000 Trinity River Auth TX Rev Tarrant Cnty Wtr Proj Impt & Rfdg (MBIA Insd).............. 5.500 02/01/21 1,065,030 2,500 University TX Rev Fin Sys Ser B........... 5.250 08/15/20 2,630,325 ------------- 43,092,475 -------------
14 See Notes to Financial Statements VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) DESCRIPTION COUPON MATURITY VALUE - ---------------------------------------------------------------------------------------------- UTAH 0.4% $1,000 Salt Lake Cnty, UT College Rev Westminster College Proj.............................. 5.750% 10/01/27 $ 1,003,070 135 Utah St Hsg Fin Agy Single Family Mtg Ser B Class 2 (FHA/VA Insd) (AMT)............. 6.250 07/01/14 135,140 ------------- 1,138,210 ------------- WASHINGTON 6.6% 3,270 Central, WA Univ Sys Rev (FGIC Insd)...... 5.000 05/01/28 3,215,228 3,410 Clark Cnty, WA Pub Util Dist Rfdg (FSA Insd)..................................... 5.500 01/01/08 3,696,781 2,595 Clark Cnty, WA Pub Util Dist Rfdg (FSA Insd)..................................... 5.500 01/01/09 2,842,874 1,300 Energy Northwest WA Elec Rev Proj No 3 Ser A Rfdg (FSA Insd)......................... 5.500 07/01/17 1,396,993 4,400 King Cnty, WA Ser B Rfdg (MBIA Insd)...... 5.250 01/01/34 4,436,564 1,000 Spokane, WA Pub Fac Dist Hotel (MBIA Insd)..................................... 5.750 12/01/20 1,102,740 2,100 Spokane, WA Pub Fac Dist Hotel (MBIA Insd)..................................... 5.750 12/01/21 2,303,868 ------------- 18,995,048 ------------- WISCONSIN 2.1% 2,345 Appleton, WI Wtrwks Rev Rfdg (FGIC Insd)..................................... 5.375 01/01/19 2,492,829 3,500 Milwaukee, WI Redev Auth Rev Milwaukee Pub Schs (AMBAC Insd)......................... 5.125 08/01/22 3,574,550 ------------- 6,067,379 ------------- GUAM 1.0% 2,800 Guam Pwr Auth Rev Ser A (AMBAC Insd)...... 5.250 10/01/34 2,832,172 ------------- PUERTO RICO 0.3% 1,000 Puerto Rico Indl Tourist Ed Med & Environmental Ctl Fac Fin Auth Higher Ed Rev....................................... 5.375 02/01/19 1,013,780 ------------- TOTAL LONG-TERM INVESTMENTS 155.4% (Cost $428,587,805)......................................................... 447,905,591 SHORT-TERM INVESTMENTS 2.3% (Cost $6,600,000)........................................................... 6,600,000 ------------- TOTAL INVESTMENTS 157.7% (Cost $435,187,805)......................................................... 454,505,591
See Notes to Financial Statements 15 VAN KAMPEN MUNICIPAL INCOME TRUST PORTFOLIO OF INVESTMENTS -- JUNE 30, 2004 continued
PAR AMOUNT (000) VALUE - ---------------------------------------------------------------------------------------------- LIABILITIES IN EXCESS OF OTHER ASSETS (0.4%)................................. $ (1,266,830) PREFERRED SHARES (INCLUDING ACCRUED DISTRIBUTIONS) (57.3%)................... (165,055,109) ------------- NET ASSETS APPLICABLE TO COMMON SHARES 100.0%................................. $ 288,183,652 =============
Percentages are calculated as a percentage of net assets applicable to common shares. * Zero coupon bond (a) All or a portion of these securities have been physically segregated in connection with open futures contracts. (b) These securities are restricted and may be resold only in transactions exempt from registration which are normally those transactions with qualified institutional buyers. Restricted Securities comprise 1.47% of net assets applicable to common shares. (c) Security purchased on a when-issued or delayed delivery basis. (d) Security is a "step-up" bond where the coupon increases or steps up at a predetermined date. ACA--American Capital Access AMBAC--AMBAC Indemnity Corp. AMT--Alternative Minimum Tax FGIC--Financial Guaranty Insurance Co. FHA/VA--Federal Housing Administration/Department of Veterans Affairs FSA--Financial Security Assurance Inc. MBIA--Municipal Bond Investors Assurance Corp. XLCA--XL Capital Assurance Inc. 16 See Notes to Financial Statements VAN KAMPEN MUNICIPAL INCOME TRUST FINANCIAL STATEMENTS Statement of Assets and Liabilities June 30, 2004 ASSETS: Total Investments (Cost $435,187,805)....................... $454,505,591 Cash........................................................ 15,510 Receivables: Interest.................................................. 6,460,247 Investments Sold.......................................... 288,037 Other....................................................... 16,363 ------------ Total Assets............................................ 461,285,748 ------------ LIABILITIES: Payables: Investments Purchased..................................... 7,278,020 Investment Advisory Fee................................... 221,883 Income Distributions--Common Shares....................... 106,168 Variation Margin on Futures............................... 42,937 Other Affiliates.......................................... 15,989 Trustees' Deferred Compensation and Retirement Plans........ 262,364 Accrued Expenses............................................ 119,626 ------------ Total Liabilities....................................... 8,046,987 Preferred Shares (including accrued distributions).......... 165,055,109 ------------ NET ASSETS APPLICABLE TO COMMON SHARES...................... $288,183,652 ============ NET ASSET VALUE PER COMMON SHARE ($288,183,652 divided by 28,684,985 shares outstanding)............................ $ 10.05 ============ NET ASSETS CONSIST OF: Common Shares ($.01 par value with an unlimited number of shares authorized, 28,684,985 shares issued and outstanding).............................................. $ 286,850 Paid in Surplus............................................. 265,829,515 Net Unrealized Appreciation................................. 19,234,329 Accumulated Undistributed Net Investment Income............. 2,505,440 Accumulated Net Realized Gain............................... 327,518 ------------ NET ASSETS APPLICABLE TO COMMON SHARES...................... $288,183,652 ============ PREFERRED SHARES ($.01 par value, authorized 1,000,000 shares, 330 issued with liquidation preference of $500,000 per share)................................................ $165,000,000 ============ NET ASSETS INCLUDING PREFERRED SHARES....................... $453,183,652 ============
See Notes to Financial Statements 17 VAN KAMPEN MUNICIPAL INCOME TRUST FINANCIAL STATEMENTS continued Statement of Operations For the Year Ended June 30, 2004 INVESTMENT INCOME: Interest.................................................... $ 22,270,447 ------------ EXPENSES: Investment Advisory Fee..................................... 2,777,232 Preferred Share Maintenance................................. 437,806 Trustees' Fees and Related Expenses......................... 86,857 Legal....................................................... 50,595 Custody..................................................... 27,954 Other....................................................... 281,608 ------------ Total Expenses.......................................... 3,662,052 ------------ NET INVESTMENT INCOME....................................... $ 18,608,395 ============ REALIZED AND UNREALIZED GAIN/LOSS: Realized Gain/Loss: Investments............................................... $ 1,540,592 Futures................................................... (50,998) ------------ Net Realized Gain........................................... 1,489,594 ------------ Unrealized Appreciation/Depreciation: Beginning of the Period................................... 38,927,157 ------------ End of the Period: Investments............................................. 19,317,786 Futures................................................. (83,457) ------------ 19,234,329 ------------ Net Unrealized Depreciation During the Period............... (19,692,828) ------------ NET REALIZED AND UNREALIZED LOSS............................ $(18,203,234) ============ DISTRIBUTIONS TO PREFERRED SHAREHOLDERS..................... $ (1,580,017) ============ NET DECREASE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM OPERATIONS................................................ $ (1,174,856) ============
18 See Notes to Financial Statements VAN KAMPEN MUNICIPAL INCOME TRUST FINANCIAL STATEMENTS continued Statements of Changes in Net Assets
FOR THE FOR THE YEAR ENDED YEAR ENDED JUNE 30, 2004 JUNE 30, 2003 ------------------------------ FROM INVESTMENT ACTIVITIES: Operations: Net Investment Income...................................... $ 18,608,395 $ 18,981,992 Net Realized Gain.......................................... 1,489,594 3,743,147 Net Unrealized Appreciation/Depreciation During the Period................................................... (19,692,828) 16,417,441 Distributions to Preferred Shareholders: Net Investment Income.................................... (1,580,017) (2,032,221) ------------ ------------ Change in Net Assets Applicable to Common Shares from Operations............................................... (1,174,856) 37,110,359 Distributions to Common Shareholders: Net Investment Income.................................... (17,210,089) (15,661,138) Net Realized Gain........................................ (1,325,170) -0- ------------ ------------ NET CHANGE IN NET ASSETS APPLICABLE TO COMMON SHARES FROM INVESTMENT ACTIVITIES.................................... (19,710,115) 21,449,221 NET ASSETS APPLICABLE TO COMMON SHARES: Beginning of the Period.................................... 307,893,767 286,444,546 ------------ ------------ End of the Period (Including accumulated undistributed net investment income of $2,505,440 and $2,784,043, respectively)............................................ $288,183,652 $307,893,767 ============ ============
See Notes to Financial Statements 19 VAN KAMPEN MUNICIPAL INCOME TRUST FINANCIAL HIGHLIGHTS THE FOLLOWING SCHEDULE PRESENTS FINANCIAL HIGHLIGHTS FOR ONE COMMON SHARE OF THE TRUST OUTSTANDING THROUGHOUT THE PERIODS INDICATED.
-------------------------------------- 2004 2003 2002 (e) -------------------------------------- NET ASSET VALUE, BEGINNING OF THE PERIOD............ $ 10.73 $ 9.99 $ 9.62 ---------- ---------- ---------- Net Investment Income............................. .65 .66 .70 Net Realized and Unrealized Gain/Loss............. (.62) .70 .31 Common Share Equivalent of Distributions Paid to Preferred Shareholders: Net Investment Income............................. (.06) (.07) (.11) ---------- ---------- ---------- Total from Investment Operations.................... (.03) 1.29 .90 Distributions Paid to Common Shareholders: Net Investment Income............................. (.60) (.55) (.53) Net Realized Gain................................. (.05) -0- -0- ---------- ---------- ---------- NET ASSET VALUE, END OF THE PERIOD.................. $ 10.05 $ 10.73 $ 9.99 ========== ========== ========== Common Share Market Price at End of the Period...... $ 8.87 $ 9.66 $ 8.85 Total Return (a).................................... -1.63% 15.76% 5.64% Net Assets Applicable to Common Shares at End of the Period (In millions).............................. $ 288.2 $ 307.9 $ 286.4 Ratio of Expenses to Average Net Assets Applicable to Common Shares (b).............................. 1.23% 1.21% 1.25% Ratio of Net Investment Income to Average Net Assets Applicable to Common Shares (b)................... 6.25% 6.35% 6.99% Portfolio Turnover.................................. 22% 35% 41% SUPPLEMENTAL RATIOS: Ratio of Expenses to Average Net Assets Including Preferred Shares (b).............................. .79% .78% .79% Ratio of Net Investment Income to Average Net Assets Applicable to Common Shares (c)................... 5.72% 5.67% 5.92% SENIOR SECURITIES: Total Preferred Shares Outstanding.................. 330 330 330 Asset Coverage Per Preferred Share (d).............. $1,373,451 $1,433,101 $1,368,316 Involuntary Liquidating Preference Per Preferred Share............................................. $ 500,000 $ 500,000 $ 500,000 Average Market Value Per Preferred Share............ $ 500,000 $ 500,000 $ 500,000
(a) Total return assumes an investment at the common share market price at the beginning of the period indicated, reinvestment of all distributions for the period in accordance with the Trust's dividend reinvestment plan, and sale of all shares at the closing common share market price at the end of the period indicated. (b) Ratios do not reflect the effect of distributions to preferred shareholders. (c) Ratios reflect the effect of distributions to preferred shareholders. (d) Calculated by subtracting the Trust's total liabilities (not including the preferred shares) from the Trust's total assets and dividing this by the number of preferred shares outstanding. (e) As required, effective July 1, 2001, the Trust has adopted the provisions of the AICPA Audit and Accounting Guide for Investment Companies and began accreting market discount on fixed income securities. The effect of this change for the year ended June 30, 2002 was to increase net investment income per share by $.01, decrease realized and unrealized gains and losses per share by $.01, and increase the ratio of net investment income to average net assets applicable to common shares by .04%. Per shares, supplemental data for the period prior to June 30, 2002 have not been restated to reflect this change in presentation. 20
YEAR ENDED JUNE 30, - --------------------------------------------------------------------------------------------- 2001 2000 1999 1998 1997 1996 1995 - --------------------------------------------------------------------------------------------- $ 8.99 $ 9.56 $ 10.26 $ 10.01 $ 9.76 $ 9.76 $ 9.92 ---------- ---------- ---------- ---------- ---------- ---------- ---------- .75 .81 .84 .89 .92 .94 .96 .66 (.55) (.70) .26 .26 .05 (.06) (.23) (.22) (.19) (.21) (.21) (.22) (.22) ---------- ---------- ---------- ---------- ---------- ---------- ---------- 1.18 .04 (.05) .94 .97 .77 .68 (.55) (.61) (.65) (.69) (.72) (.77) (.84) -0- -0- -0- -0- -0- -0- -0- ---------- ---------- ---------- ---------- ---------- ---------- ---------- $ 9.62 $ 8.99 $ 9.56 $ 10.26 $ 10.01 $ 9.76 $ 9.76 ========== ========== ========== ========== ========== ========== ========== $ 8.89 $ 8.6875 $ 9.625 $ 10.875 $ 10.875 $ 9.875 $ 11.125 8.88% -3.08% -5.68% 6.85% 18.32% -4.27% 8.59% $ 276.0 $ 258.0 $ 274.1 $ 292.3 $ 283.2 $ 273.7 $ 271.1 1.27% 1.32% 1.24% 1.23% 1.28% 1.31% 1.33% 7.94% 9.06% 8.23% 8.69% 9.25% 9.47% 9.85% 50% 54% 98% 103% 53% 29% 38% .79% .81% .79% .79% .80% .82% .83% 5.50% 6.59% 6.35% 6.64% 7.18% 7.26% 7.56% 330 330 330 330 330 330 330 $1,336,403 $1,281,820 $1,330,642 $1,385,892 $1,358,326 $1,329,390 $1,321,483 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000 $ 500,000
See Notes to Financial Statements 21 VAN KAMPEN MUNICIPAL INCOME TRUST NOTES TO FINANCIAL STATEMENTS -- JUNE 30, 2004 1. SIGNIFICANT ACCOUNTING POLICIES Van Kampen Municipal Income Trust (the "Trust") is registered as a diversified, closed-end management investment company under the Investment Company Act of 1940, as amended. The Trust's investment objective is to provide a high level of current income exempt from federal income tax, consistent with preservation of capital. The Trust commenced investment operations on August 26, 1988. Effective November 30, 2003, the Trust's investment adviser, Van Kampen Investment Advisory Corp. merged into its affiliate, Van Kampen Asset Management (the "Adviser"). The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. A. SECURITY VALUATION Municipal bonds are valued by independent pricing services or dealers using the mean of the bid and asked prices or, in the absence of market quotations, at fair value based upon yield data relating to municipal bonds with similar characteristics and general market conditions. Securities which are not valued by independent pricing services or dealers are valued at fair value using procedures established in good faith by the Board of Trustees. Futures contracts are valued at the settlement price established each day on the exchange on which they are traded. Short-term securities with remaining maturities of 60 days or less are valued at amortized cost, which is considered to approximate market value. B. SECURITY TRANSACTIONS Security transactions are recorded on a trade date basis. Realized gains and losses are determined on an identified cost basis. The Trust may purchase and sell securities on a "when-issued" or "delayed delivery" basis, with settlement to occur at a later date. The value of the security so purchased is subject to market fluctuations during this period. The Trust will segregate assets with the custodian having an aggregate value at least equal to the amount of the when-issued or delayed delivery purchase commitments until payment is made. At June 30, 2004, the Trust had $7,278,020 of when-issued or delayed delivery purchase commitments. C. INVESTMENT INCOME Interest income is recorded on an accrual basis. Bond premium is amortized and discount is accreted over the expected life of each applicable security. D. FEDERAL INCOME TAXES It is the Trust's policy to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute substantially all of its taxable income to its shareholders. Therefore, no provision for federal income taxes is required. 22 VAN KAMPEN MUNICIPAL INCOME TRUST NOTES TO FINANCIAL STATEMENTS -- JUNE 30, 2004 continued At June 30, 2004, the cost and related gross unrealized appreciation and depreciation are as follows: Cost of investments for tax purposes........................ $434,904,101 ============ Gross tax unrealized appreciation........................... $ 20,613,819 Gross tax unrealized depreciation........................... (1,012,329) ------------ Net tax unrealized appreciation on investments.............. $ 19,601,490 ============
E. DISTRIBUTION OF INCOME AND GAINS The Trust declares and pays monthly dividends from net investment income to common shareholders. Net realized gains, if any, are distributed annually to common shareholders. Distributions from net realized gains for book purposes may include short-term capital gains and gains on future transactions. All short-term capital gains and a portion of futures gains are included as ordinary income for tax purposes. The tax character of distributions paid during the years ended June 30, 2004 and 2003 was as follows:
2004 2003 Distributions paid from: Ordinary income........................................... $ 145,772 $18,900 Long-term capital gain.................................... 1,305,092 -0- ---------- ------- $1,450,864 $18,900 ========== =======
Due to inherent differences in the recognition of income, expenses, and realized gain/losses under accounting principles generally accepted in the United States of America and federal income tax purposes, permanent differences between book and tax basis reporting have been identified and appropriately reclassified on the Statement of Assets and Liabilities. A permanent difference relating to book to tax accretion differences totaling $96,892 was reclassified from accumulated undistributed net investment income to accumulated net realized gain. As of June 30, 2004, the component of distributable earnings on a tax basis were as follows: Undistributed ordinary income............................... $ 27,509 Undistributed long-term capital gain........................ 177,940
Net realized gains or losses may differ for financial and tax reporting purposes primarily as a result of gains or losses recognized for tax purposes on open futures contracts on June 30, 2004. 2. INVESTMENT ADVISORY AGREEMENT AND OTHER TRANSACTIONS WITH AFFILIATES Under the terms of the Trust's Investment Advisory Agreement, the Adviser provides investment advice and facilities to the Trust for an annual fee payable monthly of .60% of the average daily net assets of the Trust. 23 VAN KAMPEN MUNICIPAL INCOME TRUST NOTES TO FINANCIAL STATEMENTS -- JUNE 30, 2004 continued For the year ended June 30, 2004, the Trust recognized expenses of approximately $29,800 representing legal services provided by Skadden, Arps, Slate, Meagher & Flom LLP, counsel to the Trust, of which a trustee of the Trust is an affiliated person. Under separate Accounting Services and Legal Services agreements, the Adviser provides accounting and legal services to the Trust. The Adviser allocates the cost of such services to each trust. For the year ended June 30, 2004, the Trust recognized expenses of approximately $46,400 representing Van Kampen Investments Inc.'s or its affiliates' (collectively "Van Kampen") cost of providing accounting and legal services to the Trust, which are reported as part of "Other" and "Legal" expenses, respectively, in the Statement of Operations. Certain officers and trustees of the Trust are also officers and directors of Van Kampen. The Trust does not compensate its officers or trustees who are officers of Van Kampen. The Trust provides deferred compensation and retirement plans for its trustees who are not officers of Van Kampen. Under the deferred compensation plan, trustees may elect to defer all or a portion of their compensation to a later date. Benefits under the retirement plan are payable upon retirement for a ten-year period and are based upon each trustee's years of service to the Trust. The maximum annual benefit per trustee under the plan is $2,500. 3. INVESTMENT TRANSACTIONS During the period, the cost of purchases and proceeds from sales of investments, excluding short-term investments, were $102,409,833 and $103,256,563, respectively. 4. DERIVATIVE FINANCIAL INSTRUMENTS A derivative financial instrument in very general terms refers to a security whose value is "derived" from the value of an underlying asset, reference rate, or index. In order to seek to manage the interest rate exposure of the Trust's portfolio in a changing interest rate environment, the Trust may purchase or sell financial futures contracts or engage in transactions involving interest rate swaps, caps, floors, or collars. The Trust expects to enter into these transactions primarily as a hedge against anticipated interest rate or fixed-income market changes, for duration management or for risk management purposes, but may also enter into these transactions to generate additional income. All of the Trust's portfolio holdings, including derivative instruments, are marked to market each day with the change in value reflected in unrealized appreciation/depreciation. Upon disposition, a realized gain or loss is recognized accordingly, except when taking delivery of a security underlying a futures contract. In this instance, the recognition of gain or loss is postponed until the disposal of the security underlying the futures contract. Risks may arise as a result of the potential inability of the counterparties to meet the terms of their contracts or agreements. During the period, the Trust invested in futures contracts, a type of derivative. A futures contract is an arrangement involving the delivery of a particular asset on a specified future date at an agreed upon price. The Trust generally invests in exchange traded futures on U.S. Treasury Bonds and Notes and typically closes the contract prior to the delivery date. Upon entering into futures contracts, the Trust maintains an amount of cash or liquid securities with a value equal to a percentage of the contract amount with either a futures commission merchant pursuant to the rules and regulations promulgated under the 1940 Act, as amended, or with its custodian in an account in the broker's name. This amount is known as initial margin. During the period the futures contract is open, payments are received from or made to the broker based upon changes in the value of the contract (the variation margin). 24 VAN KAMPEN MUNICIPAL INCOME TRUST NOTES TO FINANCIAL STATEMENTS -- JUNE 30, 2004 continued The risk of loss associated with a futures contract is in excess of the variation margin reflected on the Statement of Assets and Liabilities. Transactions in futures contracts for the year ended June 30, 2004, were as follows:
CONTRACTS Outstanding at June 30, 2003................................ 70 Futures Opened.............................................. 277 Futures Closed.............................................. (276) ---- Outstanding at June 30, 2004................................ 71 ====
The futures contracts outstanding as of June 30, 2004, and the description and unrealized appreciation/depreciation are as follows:
UNREALIZED APPRECIATION/ CONTRACTS DEPRECIATION SHORT CONTRACTS: 10-Year U.S. Treasury Note--September 2004 (Current Notional Value of $109,328 per contract)......... 34 $(49,800) 5-Year U.S. Treasury Note--September 2004 (Current Notional Value of $108,688 per contract)......... 37 (33,657) -- -------- 71 $(83,457) == ========
5. PREFERRED SHARES The Trust has outstanding 330 shares of Rate Adjusted Tax-Exempt Shares ("Rates") in three series of 110 shares each. Dividends are cumulative and the dividend rate is currently reset every 28 days through an auction process. The average rate in effect on June 30, 2004 was 1.255%. During the year ended June 30, 2004, the rates ranged from 0.700% to 1.310%. The Trust pays annual fees equivalent to .25% of the preferred share liquidation value for the remarketing efforts associated with the preferred auctions. These fees are included as a component of "Preferred Share Maintenance" expense in the Statement of Operations. The Rates are redeemable at the option of the Trust in whole or in part at a price of $500,000 per share plus accumulated and unpaid dividends. The Trust is subject to certain asset coverage tests, and the Rates are subject to mandatory redemption if the tests are not met. 6. INDEMNIFICATIONS The Trust enters into contracts that contain a variety of indemnifications. The Trust's maximum exposure under these arrangements is unknown. However, the Trust has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote. 25 VAN KAMPEN MUNICIPAL INCOME TRUST REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Trustees and Shareholders of Van Kampen Municipal Income Trust: We have audited the accompanying statement of assets and liabilities of Van Kampen Municipal Income Trust (the "Trust"), including the portfolio of investments, as of June 30, 2004, the related statement of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended, and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Trust's management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. The Trust's financial highlights for the periods ended prior to June 30, 2000, were audited by other auditors whose report, dated August 5, 1999, expressed an unqualified opinion on those financial highlights. We conducted our audits in accordance with standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Our procedures included confirmation of securities owned as of June 30, 2004, by correspondence with the Trust's custodian and brokers; where replies were not received from brokers, we performed other auditing procedures. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements and financial highlights referred to above present fairly, in all material respects, the financial position of Van Kampen Municipal Income Trust as of June 30, 2004, the results of its operations for the year then ended, the changes in its net assets and the financial highlights for the respective stated periods, in conformity with accounting principles generally accepted in the United States of America. DELOITTE & TOUCHE LLP Chicago, Illinois August 9, 2004 26 VAN KAMPEN MUNICIPAL INCOME TRUST DIVIDEND REINVESTMENT PLAN The Trust offers a dividend reinvestment plan (the "Plan") pursuant to which Common Shareholders may elect to have dividends and capital gains distributions reinvested in Common Shares of the Trust. The Trust declares dividends out of net investment income, and will distribute annually net realized capital gains, if any. Common Shareholders may join or withdraw from the Plan at any time. If you decide to participate in the Plan, State Street Bank and Trust Company, as your Plan Agent, will automatically invest your dividends and capital gains distributions in Common Shares of the Trust for your account. HOW TO PARTICIPATE If you wish to participate and your shares are held in your own name, call 1-800-341-2929 for more information and a Plan brochure. If your shares are held in the name of a brokerage firm, bank, or other nominee, you should contact your nominee to see if it would participate in the Plan on your behalf. If you wish to participate in the Plan, but your brokerage firm, bank or nominee is unable to participate on your behalf, you should request that your shares be re-registered in your own name which will enable your participation in the Plan. HOW THE PLAN WORKS Participants in the Plan will receive the equivalent in Common Shares valued on the valuation date, generally at the lower of market price or net asset value, except as specified below. The valuation date will be the dividend or distribution payment date or, if that date is not a trading day on the national securities exchange or market system on which the Common Shares are listed for trading, the next preceding trading day. If the market price per Common Share on the valuation date equals or exceeds net asset value per Common Share on that date, the Trust will issue new Common Shares to participants valued at the higher of net asset value or 95% of the market price on the valuation date. In the foregoing situation, the Trust will not issue Common Shares under the Plan below net asset value. If net asset value per Common Share on the valuation date exceeds the market price per Common Share on that date, or if the Board of Trustees should declare a dividend or capital gains distribution payable to the Common Shareholders only in cash, participants in the Plan will be deemed to have elected to receive Common Shares from the Trust valued at the market price on that date. Accordingly, in this circumstance, the Plan Agent will, as agent for the participants, buy the Trust's Common Shares in the open market for the participants' accounts on or shortly after the payment date. If, before the Plan Agent has completed its purchases, the market price exceeds the net asset value per share of the Common Shares, the average per share purchase price paid by the Plan Agent may exceed the net asset value 27 VAN KAMPEN MUNICIPAL INCOME TRUST DIVIDEND REINVESTMENT PLAN continued of the Trust's Common Shares, resulting in the acquisition of fewer Common Shares than if the dividend or distribution had been paid in Common Shares issued by the Trust. All reinvestments are in full and fractional Common shares and are carried to three decimal places. Experience under the Plan may indicate that changes are desirable. Accordingly, the Trust reserves the right to amend or terminate the Plan as applied to any dividend or distribution paid subsequent to written notice of the change sent to all Common Shareholders of the Trust at least 90 days before the record date for the dividend or distribution. The Plan also may be amended or terminated by the Plan Agent by at least 90 days written notice to all Common Shareholders of the Trust. COSTS OF THE PLAN The Plan Agent's fees for the handling of the reinvestment of dividends and distributions will be paid by the Trust. However, each participant will pay a pro rata share of brokerage commissions incurred with respect to the Plan Agent's open market purchases in connection with the reinvestment of dividends and distributions. No other charges will be made to participants for reinvesting dividends or capital gains distributions, except for certain brokerage commissions, as described above. TAX IMPLICATIONS You will receive tax information annually for your personal records and to help you prepare your federal income tax return. The automatic reinvestment of dividends and capital gains distributions does not relieve you of any income tax which may be payable on dividends or distributions. RIGHT TO WITHDRAW Plan participants may withdraw at any time by calling 1-800-341-2929 or by writing State Street Bank and Trust Company, P.O. Box 8200, Boston, MA 02266-8200. If you withdraw, you will receive, without charge, a share certificate issued in your name for all full Common Shares credited to your account under the Plan and a cash payment will be made for any fractional Common Share credited to your account under the Plan. You may again elect to participate in the Plan at any time by calling 1-800-341-2929 or writing to the Trust at: Van Kampen Funds Inc. Attn: Closed-End Funds 2800 Post Oak Blvd. Houston, TX 77056 28 VAN KAMPEN MUNICIPAL INCOME TRUST BOARD OF TRUSTEES AND IMPORTANT ADDRESSES BOARD OF TRUSTEES DAVID C. ARCH J. MILES BRANAGAN JERRY D. CHOATE ROD DAMMEYER LINDA HUTTON HEAGY R. CRAIG KENNEDY HOWARD J KERR MITCHELL M. MERIN* JACK E. NELSON RICHARD F. POWERS, III* HUGO F. SONNENSCHEIN WAYNE W. WHALEN* - Chairman SUZANNE H. WOOLSEY INVESTMENT ADVISER VAN KAMPEN ASSET MANAGEMENT 1221 Avenue of the Americas New York, New York 10020 CUSTODIAN AND TRANSFER AGENT STATE STREET BANK AND TRUST COMPANY c/o EquiServe P.O. Box 43011 Providence, Rhode Island 02940-3011 LEGAL COUNSEL SKADDEN, ARPS, SLATE, MEAGHER & FLOM LLP 333 West Wacker Drive Chicago, Illinois 60606 INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM DELOITTE & TOUCHE LLP 180 North Stetson Avenue Chicago, Illinois 60601 For federal income tax purposes, the following information is furnished with respect to the distributions paid by the Trust during its taxable year ended June 30, 2004. The Trust designated 99.3% of the income distributions as a tax-exempt income distribution. The Trust designated and paid $1,305,092 as a long-term capital gain distribution. In January, the Trust provides tax information to shareholders for the preceding calendar year. * "Interested persons" of the Trust, as defined in the Investment Company Act of 1940, as amended. 29 VAN KAMPEN MUNICIPAL INCOME TRUST RESULTS OF SHAREHOLDER VOTES An Annual Meeting of Shareholders of the Trust was held on June 23, 2004, where shareholders voted on the election of trustees. 1) With regard to the election of the following trustees by common shareholders of the Trust:
# OF SHARES ------------------------------ IN FAVOR WITHHELD - ------------------------------------------------------------------------------------------ R. Craig Kennedy.......................................... 23,677,081 786,946 Jack E. Nelson............................................ 23,678,718 785,309 Richard F. Powers, III.................................... 23,689,661 774,366
2) With regard to the election of the following trustee by preferred shareholders of the Trust:
# OF SHARES ---------------------------- IN FAVOR WITHHELD - ------------------------------------------------------------------------------------------ Hugo F. Sonnenschein........................................ 223 --
The other trustees whose term did not expire in 2004 were: David C. Arch, J. Miles Branagan, Jerry D. Choate, Rod Dammeyer, Linda Hutton Heagy, Howard J Kerr, Mitchell M. Merin, Wayne W. Whalen, and Suzanne H. Woolsey. 30 VAN KAMPEN MUNICIPAL INCOME TRUST TRUSTEE AND OFFICER INFORMATION The business and affairs of the Trust are managed under the direction of the Trust's Board of Trustees and the Trust's officers appointed by the Board of Trustees. The tables below list the trustees and executive officers of the Trust and their principal occupations during the last five years, other directorships held by trustees and their affiliations, if any, with Van Kampen Investments Inc. ("Van Kampen Investments"), Van Kampen Asset Management ("Asset Management" or the "Adviser"), Van Kampen Funds Inc. (the "Distributor"), Van Kampen Advisors Inc., Van Kampen Exchange Corp. and Van Kampen Investor Services Inc. ("Investor Services"). The term "Fund Complex" includes each of the investment companies advised by the Adviser or its affiliates as of the date of this Statement of Additional Information. Trustees serve until reaching their retirement age or until their successors are duly elected and qualified. Officers are annually elected by the trustees. INDEPENDENT TRUSTEES
NUMBER OF TERM OF FUNDS IN OFFICE AND FUND POSITION(S) LENGTH OF COMPLEX NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE David C. Arch (59) Trustee Trustee Chairman and Chief 88 Trustee/Director/Managing Blistex Inc. since 1998 Executive Officer of General Partner of funds 1800 Swift Drive Blistex Inc., a consumer in the Fund Complex. Oak Brook, IL 60523 health care products manufacturer. Director of the Heartland Alliance, a nonprofit organization serving human needs based in Chicago. Director of St. Vincent de Paul Center, a Chicago based day care facility serving the children of low income families. Board member of the Illinois Manufacturers' Association. J. Miles Branagan (72) Trustee Trustee Private investor. 86 Trustee/Director/Managing 1632 Morning Mountain Road since 2003 Co-founder, and prior to General Partner of funds Raleigh, NC 27614 August 1996, Chairman, in the Fund Complex. Chief Executive Officer and President, MDT Corporation (now known as Getinge/Castle, Inc., a subsidiary of Getinge Industrier AB), a company which develops, manufactures, markets and services medical and scientific equipment.
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VAN KAMPEN MUNICIPAL INCOME TRUST TRUSTEE AND OFFICER INFORMATION continued NUMBER OF TERM OF FUNDS IN OFFICE AND FUND POSITION(S) LENGTH OF COMPLEX NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE Jerry D. Choate (65) Trustee Trustee Prior to January 1999, 86 Trustee/Director/Managing 33971 Selva Road since 2003 Chairman and Chief General Partner of funds Suite 130 Executive Officer of the in the Fund Complex. Dana Point, CA 92629 Allstate Corporation Director of Amgen Inc., a ("Allstate") and Allstate biotechnological company, Insurance Company. Prior and Director of Valero to January 1995, Energy Corporation, an President and Chief independent refining Executive Officer of company. Allstate. Prior to August 1994, various management positions at Allstate.
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VAN KAMPEN MUNICIPAL INCOME TRUST TRUSTEE AND OFFICER INFORMATION continued NUMBER OF TERM OF FUNDS IN OFFICE AND FUND POSITION(S) LENGTH OF COMPLEX NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE Rod Dammeyer (63) Trustee Trustee President of CAC, L.L.C., 88 Trustee/Director/Managing CAC, L.L.C. since 1998 a private company General Partner of funds 4350 LaJolla Village Drive offering capital in the Fund Complex. Suite 980 investment and management Director of Stericycle, San Diego, CA 92122-6223 advisory services. Prior Inc., Ventana Medical to February 2001, Vice Systems, Inc., GATX Chairman and Director of Corporation and Trustee Anixter International, of The Scripps Research Inc., a global Institute and the distributor of wire, University of Chicago cable and communications Hospitals and Health connectivity products, Systems. Prior to April and IMC Global Inc., an 2004, Director of international company TheraSense, Inc. Prior to that mines, manufactures January 2004, Director of and sells essential crop TeleTech Holdings Inc. nutrients and feed and Arris Group, Inc. ingredients to farmers. Prior to May 2002, Prior to July 2000, Director of Peregrine Managing Partner of Systems Inc. Prior to Equity Group Corporate February 2001, Vice Investment (EGI), a Chairman and Director of company that makes Anixter International, private investments in Inc. and IMC Global Inc. other companies. Prior to July 2000, Director of Allied Riser Communications Corp., Matria Healthcare Inc., Transmedia Networks, Inc., CNA Surety, Corp. and Grupo Azcarero Mexico (GAM).
33
VAN KAMPEN MUNICIPAL INCOME TRUST TRUSTEE AND OFFICER INFORMATION continued NUMBER OF TERM OF FUNDS IN OFFICE AND FUND POSITION(S) LENGTH OF COMPLEX NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE Linda Hutton Heagy (56) Trustee Trustee Managing Partner of 86 Trustee/Director/Managing Heidrick & Struggles since 2003 Heidrick & Struggles, an General Partner of funds 233 South Wacker Drive executive search firm. in the Fund Complex. Suite 7000 Trustee on the University Chicago, IL 60606 of Chicago Hospitals Board, Vice Chair of the Board of the YMCA of Metropolitan Chicago and a member of the Women's Board of the University of Chicago. Prior to 1997, Partner of Ray & Berndtson, Inc., an executive recruiting firm. Prior to 1996, Trustee of The International House Board, a fellowship and housing organization for international graduate students. Prior to 1995, Executive Vice President of ABN AMRO, N.A., a bank holding company. Prior to 1992, Executive Vice President of La Salle National Bank. R. Craig Kennedy (52) Trustee Trustee Director and President of 86 Trustee/Director/Managing 1744 R Street, NW since 2003 the German Marshall Fund General Partner of funds Washington, D.C. 20009 of the United States, an in the Fund Complex. independent U.S. foundation created to deepen understanding, promote collaboration and stimulate exchanges of practical experience between Americans and Europeans. Formerly, advisor to the Dennis Trading Group Inc., a managed futures and option company that invests money for individuals and institutions. Prior to 1992, President and Chief Executive Officer, Director and member of the Investment Committee of the Joyce Foundation, a private foundation. Howard J Kerr (68) Trustee Trustee Prior to 1998, President 88 Trustee/Director/Managing 736 North Western Avenue since 1992 and Chief Executive General Partner of funds P.O. Box 317 Officer of Pocklington in the Fund Complex. Lake Forest, IL 60045 Corporation, Inc., an Director of the Lake investment holding Forest Bank & Trust. company. Director of the Marrow Foundation.
34
VAN KAMPEN MUNICIPAL INCOME TRUST TRUSTEE AND OFFICER INFORMATION continued NUMBER OF TERM OF FUNDS IN OFFICE AND FUND POSITION(S) LENGTH OF COMPLEX NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS OF INDEPENDENT TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE Jack E. Nelson (68) Trustee Trustee President of Nelson 86 Trustee/Director/Managing 423 Country Club Drive since 2003 Investment Planning General Partner of funds Winter Park, FL 32789 Services, Inc., a in the Fund Complex. financial planning company and registered investment adviser in the State of Florida. President of Nelson Ivest Brokerage Services Inc., a member of the NASD, Securities Investors Protection Corp. and the Municipal Securities Rulemaking Board. President of Nelson Sales and Services Corporation, a marketing and services company to support affiliated companies. Hugo F. Sonnenschein (63) Trustee Trustee President Emeritus and 88 Trustee/Director/Managing 1126 E. 59th Street since 1994 Honorary Trustee of the General Partner of funds Chicago, IL 60637 University of Chicago and in the Fund Complex. the Adam Smith Director of Winston Distinguished Service Laboratories, Inc. Professor in the Department of Economics at the University of Chicago. Prior to July 2000, President of the University of Chicago. Trustee of the University of Rochester and a member of its investment committee. Member of the National Academy of Sciences, the American Philosophical Society and a fellow of the American Academy of Arts and Sciences. Suzanne H. Woolsey, P.h.D. (62) Trustee Trustee Previously Chief 86 Trustee/Director/Managing 815 Cumberstone Road since 2003 Communications Officer of General Partner of funds Harwood, MD 20776 the National Academy of in the Fund Complex. Sciences/National Director of Fluor Corp., Research Council, an an engineering, independent, federally procurement and chartered policy construction institution, from 2001 to organization, since November 2003 and Chief January 2004 and Director Operating Officer from of Neurogen Corporation, 1993 to 2001. Director of a pharmaceutical company, the Institute for Defense since January 1998. Analyses, a federally funded research and development center, Director of the German Marshall Fund of the United States, Director of the Rocky Mountain Institute and Trustee of Colorado College. Prior to 1993, Executive Director of the Commission on Behavioral and Social Sciences and Education at the National Academy of Sciences/National Research Council. From 1980 through 1989, Partner of Coopers & Lybrand.
35 VAN KAMPEN MUNICIPAL INCOME TRUST TRUSTEE AND OFFICER INFORMATION continued INTERESTED TRUSTEES*
NUMBER OF TERM OF FUNDS IN OFFICE AND FUND POSITION(S) LENGTH OF COMPLEX NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS OF INTERESTED TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE Mitchell M. Merin* (50) Trustee, Trustee President and Chief 86 Trustee/Director/Managing 1221 Avenue of the Americas President since Executive Officer of General Partner of funds New York, NY 10020 and Chief 2003; funds in the Fund in the Fund Complex. Executive President Complex. Chairman, Officer and Chief President, Chief Executive Executive Officer and Officer Director of the Adviser since 2002 and Van Kampen Advisors Inc. since December 2002. Chairman, President and Chief Executive Officer of Van Kampen Investments since December 2002. Director of Van Kampen Investments since December 1999. Chairman and Director of Van Kampen Funds Inc. since December 2002. President, Director and Chief Operating Officer of Morgan Stanley Investment Management since December 1998. President and Director since April 1997 and Chief Executive Officer since June 1998 of Morgan Stanley Investment Advisors Inc. and Morgan Stanley Services Company Inc. Chairman, Chief Executive Officer and Director of Morgan Stanley Distributors Inc. since June 1998. Chairman since June 1998, and Director since January 1998 of Morgan Stanley Trust. Director of various Morgan Stanley subsidiaries. President of the Morgan Stanley Funds since May 1999. Previously Chief Executive Officer of Van Kampen Funds Inc. from December 2002 to July 2003, Chief Strategic Officer of Morgan Stanley Investment Advisors Inc. and Morgan Stanley Services Company Inc. and Executive Vice President of Morgan Stanley Distributors Inc. from April 1997 to June 1998. Chief Executive Officer from September 2002 to April 2003 and Vice President from May 1997 to April 1999 of the Morgan Stanley Funds.
36
VAN KAMPEN MUNICIPAL INCOME TRUST TRUSTEE AND OFFICER INFORMATION continued NUMBER OF TERM OF FUNDS IN OFFICE AND FUND POSITION(S) LENGTH OF COMPLEX NAME, AGE AND ADDRESS HELD WITH TIME PRINCIPAL OCCUPATION(S) OVERSEEN OTHER DIRECTORSHIPS OF INTERESTED TRUSTEE TRUST SERVED DURING PAST 5 YEARS BY TRUSTEE HELD BY TRUSTEE Richard F. Powers, III* (58) Trustee Trustee Advisory Director of 88 Trustee/Director/Managing 1 Parkview Plaza since 1999 Morgan Stanley. Prior to General Partner of funds P.O. Box 5555 December 2002, Chairman, in the Fund Complex. Oakbrook Terrace, IL 60181 Director, President, Chief Executive Officer and Managing Director of Van Kampen Investments and its investment advisory, distribution and other subsidiaries. Prior to December 2002, President and Chief Executive Officer of funds in the Fund Complex. Prior to May 1998, Executive Vice President and Director of Marketing at Morgan Stanley and Director of Dean Witter, Discover & Co. and Dean Witter Realty. Prior to 1996, Director of Dean Witter Reynolds Inc. Wayne W. Whalen* (64) Trustee Trustee Partner in the law firm 88 Trustee/Director/Managing 333 West Wacker Drive since 1988 of Skadden, Arps, Slate, General Partner of funds Chicago, IL 60606 Meagher & Flom LLP, legal in the Fund Complex. counsel to funds in the Fund Complex.
* Such trustee is an "interested person" (within the meaning of Section 2(a)(19) of the 1940 Act). Mr. Whalen is an interested person of certain funds in the Fund Complex by reason of his firm currently acting as legal counsel to such funds in the Fund Complex. Messrs. Merin and Powers are interested persons of funds in the Fund Complex and the Adviser by reason of their current or former positions with Morgan Stanley or its affiliates. 37 VAN KAMPEN MUNICIPAL INCOME TRUST TRUSTEE AND OFFICER INFORMATION continued OFFICERS
TERM OF OFFICE AND POSITION(S) LENGTH OF NAME, AGE AND HELD WITH TIME PRINCIPAL OCCUPATION(S) ADDRESS OF OFFICER TRUST SERVED DURING PAST 5 YEARS Stefanie V. Chang (37) Vice President and Officer Executive Director of Morgan Stanley Investment Management. 1221 Avenue of the Americas Secretary since 2003 Vice President of funds in the Fund Complex. New York, NY 10020 Joseph J. McAlinden (61) Executive Vice Officer Managing Director and Chief Investment Officer of Morgan 1221 Avenue of the Americas President and since 2002 Stanley Investment Advisors Inc., Morgan Stanley Investment New York, NY 10020 Chief Investment Management Inc. and Morgan Stanley Investments LP and Officer Director of Morgan Stanley Trust for over 5 years. Executive Vice President and Chief Investment Officer of funds in the Fund Complex. Managing Director and Chief Investment Officer of Van Kampen Investments, the Adviser and Van Kampen Advisors Inc. since December 2002. Ronald E. Robison (65) Executive Vice Officer Chief Executive Officer and Chairman of Investor Services. 1221 Avenue of the Americas President and since 2003 Executive Vice President and Principal Executive Officer of New York, NY 10020 Principal funds in the Fund Complex. Chief Administrative Officer and Executive Officer Managing Director of Morgan Stanley. Managing Director and Director of Morgan Stanley Investment Advisors Inc. and Morgan Stanley Services Company Inc. Chief Executive Officer and Director of Morgan Stanley Trust. Executive Vice President and Principal Executive Officer of the Morgan Stanley Funds. Director of Morgan Stanley SICAV. Previously, Chief Global Operations Officer and Managing Director of Morgan Stanley Investment Management Inc. John L. Sullivan (48) Vice President, Officer Director and Managing Director of Van Kampen Investments, 1 Parkview Plaza Chief Financial since 1998 the Adviser, Van Kampen Advisors Inc. and certain other P.O. Box 5555 Officer and subsidiaries of Van Kampen Investments. Vice President, Oakbrook Terrace, IL 60181 Treasurer Chief Financial Officer and Treasurer of funds in the Fund Complex. Head of Fund Accounting for Morgan Stanley Investment Management. Prior to December 2002, Executive Director of Van Kampen Investments, the Adviser and Van Kampen Advisors Inc.
38 Van Kampen Privacy Notice The Van Kampen companies and investment products* respect your right to privacy. We also know that you expect us to conduct and process your business in an accurate and efficient manner. To do so, we must collect and maintain certain nonpublic personal information about you. This is information we collect from you on applications or other forms, and from the transactions you conduct with us, our affiliates, or third parties. We may also collect information you provide when using our web site, and text files (also known as "cookies") may be placed on your computer to help us to recognize you and to facilitate transactions you initiate. We do not disclose any nonpublic personal information about you or any of our former customers to anyone, except as permitted by law. For instance, so that we may continue to offer you Van Kampen investment products and services that meet your investing needs, and to effect transactions that you request or authorize, we may disclose the information we collect to companies that perform services on our behalf, such as printers and mailers that assist us in the distribution of investor materials. These companies will use this information only for the services for which we hired them, and are not permitted to use or share this information for any other purpose. To protect your nonpublic personal information internally, we permit access to it only by authorized employees, and maintain physical, electronic and procedural safeguards to guard your nonpublic personal information. * Includes Van Kampen Investments Inc., Van Kampen Asset Management, Van Kampen Advisors Inc., Van Kampen Funds Inc., Van Kampen Investor Services Inc., Van Kampen System Inc. and Van Kampen Exchange Corp., as well as the many Van Kampen mutual funds and Van Kampen unit investment trusts. Van Kampen Funds Inc. 1 Parkview Plaza, P.O. Box 5555 Oakbrook Terrace, IL 60181-5555 www.vankampen.com (VAN KAMPEN INVESTMENTS LOGO) Copyright (C)2004 Van Kampen Funds Inc. All rights reserved. Member NASD/SIPC. 920, 919, 107 VMT ANR 8/04 RN04-01589P-Y06/04 Item 2. Code of Ethics. (a) The Trust has adopted a code of ethics (the "Code of Ethics") that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these individuals are employed by the Trust or a third party. (b) No information need be disclosed pursuant to this paragraph. (c) The Trust has amended its Code of Ethics during the period covered by the shareholder report presented in Item 1 hereto. (d) The Trust has not granted a waiver or an implicit waiver from a provision of its Code of Ethics. (e) Not applicable. (f) (1) The Trust's Code of Ethics is attached hereto as Exhibit 11A. (2) Not applicable. (3) Not applicable. Item 3. Audit Committee Financial Expert. The Trust's Board of Trustees has determined that it has three "audit committee financial experts" serving on its audit committee, each of whom are "independent" Trustees: J. Miles Branagan, Jerry Choate and R. Craig Kennedy. Under applicable securities laws, a person who is determined to be an audit committee financial expert will not be deemed an "expert" for any purpose, including without limitation for the purposes of Section 11 of the Securities Act of 1933, as a result of being designated or identified as an audit committee financial expert. The designation or identification of a person as an audit committee financial expert does not impose on such person any duties, obligations, or liabilities that are greater than the duties, obligations, and liabilities imposed on such person as a member of the audit committee and Board of Trustees in the absence of such designation or identification. Item 4. Principal Accountant Fees and Services. (a)(b)(c)(d) and (g). Based on fees billed for the periods shown:
2004 REGISTRANT COVERED ENTITIES(1) AUDIT FEES........................ $29,480 N/A NON-AUDIT FEES AUDIT-RELATED FEES...... $400 $230,000(2) TAX FEES................ $1,550(3) $0(4) ALL OTHER FEES.......... $0 $0(5) TOTAL NON-AUDIT FEES.............. $1,950 $230,000 TOTAL............................. $31,430 $230,000 2003 REGISTRANT COVERED ENTITIES(1) AUDIT FEES........................ $27,676 N/A NON-AUDIT FEES AUDIT-RELATED FEES...... $3,000 $95,000(2) TAX FEES................ $1,500(3) $0(4) ALL OTHER FEES.......... $0 $0(6) TOTAL NON-AUDIT FEES.............. $4,500 $95,000 TOTAL............................. $32,176 $95,000
N/A- Not applicable, as not required by Item 4. (1) Covered Entities include the Adviser (excluding sub-advisors) and any entity controlling, controlled by or under common control with the Adviser that provides ongoing services to the Registrant. (2) Audit-Related Fees represent assurance and related services provided that are reasonably related to the performance of the audit of the financial statements of the Covered Entities' and funds advised by the Adviser or its affiliates, specifically attestation services provided in connection with a SAS 70 Report. (3) Tax Fees represent tax advice and compliance services provided in connection with the review of the Registrant's tax. (4) Tax Fees represent tax advice services provided to Covered Entities, including research and identification of PFIC entities. (5) All Other Fees represent attestation services provided in connection with performance presentation standards. (6) All Other Fees represent attestation services provided in connection with performance presentation standards, general industry education seminars provided, and a regulatory review project performed. (e)(1) The audit committee's pre-approval policies and procedures are as follows: JOINT AUDIT COMMITTEE AUDIT AND NON-AUDIT SERVICES PRE-APPROVAL POLICY AND PROCEDURES OF THE VAN KAMPEN FUNDS AS ADOPTED JULY 23, 2003(1) 1. STATEMENT OF PRINCIPLES The Audit Committee of the Board is required to review and, in its sole discretion, pre-approve all Covered Services to be provided by the Independent Auditors to the Fund and Covered Entities in order to assure that services performed by the Independent Auditors do not impair the auditor's independence from the Fund.(2) The SEC has issued rules specifying the types of services that an independent auditor may not provide to its audit client, as well as the audit committee's administration of the engagement of the independent auditor. The SEC's rules establish two different approaches to pre-approving services, which the SEC considers to be equally valid. Proposed services either: may be pre-approved without consideration of specific case-by-case services by the Audit Committee ("general pre-approval"); or require the specific pre-approval of the Audit Committee ("specific pre-approval"). The Audit Committee believes that the combination of these two approaches in this Policy will result in an effective and efficient procedure to pre-approve services performed by the Independent Auditors. As set forth in this Policy, unless a type of service has received general pre-approval, it will require specific pre-approval by the Audit Committee (or by any member of the Audit Committee to which pre-approval authority has been delegated) if it is to be provided by the Independent Auditors. Any proposed services exceeding pre-approved cost levels or budgeted amounts will also require specific pre-approval by the Audit Committee. For both types of pre-approval, the Audit Committee will consider whether such services are consistent with the SEC's rules on auditor independence. The Audit Committee will also consider whether the Independent Auditors are best positioned to provide the most effective and efficient services, for reasons such as its familiarity with the Fund's business, people, culture, accounting systems, risk profile and other factors, and whether the service might enhance the Fund's ability to manage or control risk or improve audit quality. All such factors will be considered as a whole, and no one factor should necessarily be determinative. The Audit Committee is also mindful of the relationship between fees for audit and non-audit services in deciding whether to pre-approve any such services and may determine for each fiscal year, the appropriate ratio between the total amount of fees for Audit, Audit-related and Tax services for the Fund (including any Audit-related or Tax service fees for Covered Entities that were subject to pre-approval), and the total amount of fees for certain permissible non-audit services classified as All Other services for the Fund (including any such services for Covered Entities subject to pre-approval). The appendices to this Policy describe the Audit, Audit-related, Tax and All Other services that have the general pre-approval of the Audit Committee. The term of any general pre-approval is 12 months from the date of pre-approval, unless the Audit Committee considers and provides a different period and states otherwise. The Audit Committee will annually review and pre-approve the services that may be provided by the Independent Auditors without obtaining specific pre-approval - -------- (1) This Joint Audit Committee Audit and Non-Audit Services Pre-Approval Policy and Procedures (the "Policy"), adopted as of the date above, supercedes and replaces all prior versions that may have been adopted from time to time. (2) Terms used in this Policy and not otherwise defined herein shall have the meanings as defined in the Joint Audit Committee Charter. from the Audit Committee. The Audit Committee will add to or subtract from the list of general pre-approved services from time to time, based on subsequent determinations. The purpose of this Policy is to set forth the policy and procedures by which the Audit Committee intends to fulfill its responsibilities. It does not delegate the Audit Committee's responsibilities to pre-approve services performed by the Independent Auditors to management. The Fund's Independent Auditors have reviewed this Policy and believes that implementation of the Policy will not adversely affect the Independent Auditors' independence. 2. DELEGATION As provided in the Act and the SEC's rules, the Audit Committee may delegate either type of pre-approval authority to one or more of its members. The member to whom such authority is delegated must report, for informational purposes only, any pre-approval decisions to the Audit Committee at its next scheduled meeting. 3. AUDIT SERVICES The annual Audit services engagement terms and fees are subject to the specific pre-approval of the Audit Committee. Audit services include the annual financial statement audit and other procedures required to be performed by the Independent Auditors to be able to form an opinion on the Fund's financial statements. These other procedures include information systems and procedural reviews and testing performed in order to understand and place reliance on the systems of internal control, and consultations relating to the audit. The Audit Committee will monitor the Audit services engagement as necessary, but no less than on a quarterly basis, and will also approve, if necessary, any changes in terms, conditions and fees resulting from changes in audit scope, Fund structure or other items. In addition to the annual Audit services engagement approved by the Audit Committee, the Audit Committee may grant general pre-approval to other Audit services, which are those services that only the Independent Auditors reasonably can provide. Other Audit services may include statutory audits and services associated with SEC registration statements (on Forms N-1A, N-2, N-3, N-4, etc.), periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings. The Audit Committee has pre-approved the following Audit services. All other Audit services not listed below must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated): - Statutory audits or financial audits for the Fund - Services associated with SEC registration statements (including new funds), periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings (e.g., comfort letters for closed-end fund offerings, consents), and assistance in responding to SEC comment letters - Consultations by the Fund's management as to the accounting or disclosure treatment of transactions or events and/or the actual or potential impact of final or proposed rules, standards or interpretations by the SEC, FASB, or other regulatory or standard setting bodies (Note: Under SEC rules, some consultations may be "audit related" services rather than "audit" services) 4. AUDIT-RELATED SERVICES Audit-related services are assurance and related services that are reasonably related to the performance of the audit or review of the Fund's financial statements or, to the extent they are Covered Services, the Covered Entities' financial statements, or that are traditionally performed by the Independent Auditors. Because the Audit Committee believes that the provision of Audit-related services does not impair the independence of the auditor and is consistent with the SEC's rules on auditor independence, the Audit Committee may grant general pre-approval to Audit-related services. Audit-related services include, among others, accounting consultations related to accounting, financial reporting or disclosure matters not classified as "Audit services"; assistance with understanding and implementing new accounting and financial reporting guidance from rulemaking authorities; agreed-upon or expanded audit procedures related to accounting and/or billing records required to respond to or comply with financial, accounting or regulatory reporting matters; and assistance with internal control reporting requirements under Forms N-SAR and/or N-CSR. The Audit Committee has pre-approved the following Audit-related services. All other Audit-related services not listed below must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated): - Attest procedures not required by statute or regulation (including agreed upon procedures related to the Closed-End Fund asset coverage tests required by the rating agencies and/or lenders) - Due diligence services pertaining to potential fund mergers - Issuance of SAS-70 reports on internal controls of Morgan Stanley Trust Co. and MSIM Trade Operations - Consultations by the Fund's management as to the accounting or disclosure treatment of transactions or events and/or the actual or potential impact of final or proposed rules, standards or interpretations by the SEC, FASB, or other regulatory or standard-setting bodies (Note: Under SEC rules, some consultations may be "audit" services rather than "audit-related" services) - Information systems reviews not performed in connection with the audit (e.g., application data center and technical reviews) - General assistance with implementation of the requirements of SEC rules or listing standards promulgated pursuant to the Sarbanes-Oxley Act - Audit of record keeping services performed by Morgan Stanley Trust Fund related to the New Jersey State Retirement Plan 5. TAX SERVICES The Audit Committee believes that the Independent Auditors can provide Tax services to the Fund and, to the extent they are Covered Services, the Covered Entities, such as tax compliance, tax planning and tax advice without impairing the auditor's independence, and the SEC has stated that the Independent Auditors may provide such services. Hence, the Audit Committee believes it may grant general pre-approval to those Tax services that have historically been provided by the Independent Auditors, that the Audit Committee has reviewed and believes would not impair the independence of the Independent Auditors, and that are consistent with the SEC's rules on auditor independence. The Audit Committee will not permit the retention of the Independent Auditors in connection with a transaction initially recommended by the Independent Auditors, the sole business purpose of which may be tax avoidance and the tax treatment of which may not be supported in the Internal Revenue Code and related regulations. The Audit Committee will consult with Director of Tax or outside counsel to determine that the tax planning and reporting positions are consistent with this policy. Pursuant to the preceding paragraph, the Audit Committee has pre-approved the following Tax Services. All Tax services involving large and complex transactions not listed below must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated), including tax services proposed to be provided by the Independent Auditors to any executive officer or trustee/director/managing general partner of the Fund, in his or her individual capacity, where such services are paid for by the Fund (generally applicable only to internally managed investment companies): - U.S. federal, state and local tax planning and advice - U.S. federal, state and local tax compliance - International tax planning and advice - International tax compliance - Review of federal, state, local and international income, franchise, and other tax returns - Identification of Passive Foreign Investment Companies - Review of closed-end funds pro rata allocation of taxable income and capital gains to common and preferred shares. - Domestic and foreign tax planning, compliance, and advice - Assistance with tax audits and appeals before the IRS and similar state, local and foreign agencies - Tax advice and assistance regarding statutory, regulatory or administrative developments (e.g., excise tax reviews, evaluation of Fund's tax compliance function) - Review the calculations of taxable income from corporate actions including reorganizations related to bankruptcy filings and provide guidance related to the foregoing 6. ALL OTHER SERVICES The Audit Committee believes, based on the SEC's rules prohibiting the Independent Auditors from providing specific non-audit services, that other types of non-audit services are permitted. Accordingly, the Audit Committee believes it may grant general pre-approval to those permissible non-audit services classified as All Other services that it believes are routine and recurring services, would not impair the independence of the auditor and are consistent with the SEC's rules on auditor independence. The Audit Committee has pre-approved the following All Other services. Permissible All Other services not listed below must be specifically pre-approved by the Audit Committee (or by any member of the Audit Committee to which pre-approval has been delegated): - Risk management advisory services, e.g., assessment and testing of security infrastructure controls The following is a list of the SEC's prohibited non-audit services. The SEC's rules and relevant guidance should be consulted to determine the precise definitions of these services and the applicability of exceptions to certain of the prohibitions: - Bookkeeping or other services related to the accounting records or financial statements of the audit client - Financial information systems design and implementation - Appraisal or valuation services, fairness opinions or contribution-in-kind reports - Actuarial services - Internal audit outsourcing services - Management functions - Human resources - Broker-dealer, investment adviser or investment banking services - Legal services - Expert services unrelated to the audit 7. PRE-APPROVAL FEE LEVELS OR BUDGETED AMOUNTS Pre-approval fee levels or budgeted amounts for all services to be provided by the Independent Auditors will be established annually by the Audit Committee. Any proposed services exceeding these levels or amounts will require specific pre-approval by the Audit Committee. The Audit Committee is mindful of the overall relationship of fees for audit and non-audit services in determining whether to pre-approve any such services. For each fiscal year, the Audit Committee may determine the appropriate ratio between the total amount of fees for Audit, Audit-related, and Tax services for the Fund (including any Audit-related or Tax services fees for Covered Entities subject to pre-approval), and the total amount of fees for certain permissible non-audit services classified as All Other services for the Fund (including any such services for Covered Entities subject to pre-approval). 8. PROCEDURES All requests or applications for services to be provided by the Independent Auditors that do not require specific approval by the Audit Committee will be submitted to the Fund's Chief Financial Officer and must include a detailed description of the services to be rendered. The Fund's Chief Financial Officer will determine whether such services are included within the list of services that have received the general pre-approval of the Audit Committee. The Audit Committee will be informed on a timely basis of any such services rendered by the Independent Auditors. Requests or applications to provide services that require specific approval by the Audit Committee will be submitted to the Audit Committee by both the Independent Auditors and the Fund's Chief Financial Officer, and must include a joint statement as to whether, in their view, the request or application is consistent with the SEC's rules on auditor independence. The Audit Committee has designated the Fund's Chief Financial Officer to monitor the performance of all services provided by the Independent Auditors and to determine whether such services are in compliance with this Policy. The Fund's Chief Financial Officer will report to the Audit Committee on a periodic basis on the results of its monitoring. Both the Fund's Chief Financial Officer and management will immediately report to the chairman of the Audit Committee any breach of this Policy that comes to the attention of the Fund's Chief Financial Officer or any member of management. 9. ADDITIONAL REQUIREMENTS The Audit Committee has determined to take additional measures on an annual basis to meet its responsibility to oversee the work of the Independent Auditors and to assure the auditor's independence from the Fund, such as reviewing a formal written statement from the Independent Auditors delineating all relationships between the Independent Auditors and the Fund, consistent with Independence Standards Board No. 1, and discussing with the Independent Auditors its methods and procedures for ensuring independence. 10. COVERED ENTITIES Covered Entities include the Fund's investment adviser(s) and any entity controlling, controlled by or under common control with the Fund's investment adviser(s) that provides ongoing services to the Fund(s). Beginning with non-audit service contracts entered into on or after May 6, 2003, the Fund's audit committee must pre-approve non-audit services provided not only to the Fund but also to the Covered Entities if the engagements relate directly to the operations and financial reporting of the Fund. This list of Covered Entities would include: - Van Kampen Investments, Inc. - Van Kampen Investment Advisory Corporation - Van Kampen Asset Management Inc. - Van Kampen Advisors Inc. - Van Kampen Funds Inc. - Van Kampen Trust Company - Van Kampen Investor Services Inc. - Van Kampen Management Inc. - Morgan Stanley Investment Management Inc. - Morgan Stanley Investments LP - Morgan Stanley Trust Company (e)(2) Beginning with non-audit service contracts entered into on or after May 6, 2003, the audit committee also is required to pre-approve services to Covered Entities to the extent that the services are determined to have a direct impact on the operations or financial reporting of the Registrant. 100% of such services were pre-approved by the audit committee pursuant to the Audit Committee's pre-approval policies and procedures (attached hereto). (f) Not applicable. (g) See table above. (h) The audit committee of the Board of Trustees has considered whether the provision of services other than audit services performed by the auditors to the Registrant and Covered Entities is compatible with maintaining the auditors' independence in performing audit services. Item 5. Audit Committee of Listed Registrants. Not applicable. Item 6. [Reserved.] Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. The Trust invests in exclusively non-voting securities and therefore this item is not applicable to the Trust. Item 8. Purchase of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. Not Applicable. Item 9. Submission of Matters to a Vote of Security Holders. Not Applicable. Item 10. Controls and Procedures (a) The Trust's principal executive officer and principal financial officer have concluded that the Trust's disclosure controls and procedures are sufficient to ensure that information required to be disclosed by the Trust in this Form N-CSR was recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms, based upon such officers' evaluation of these controls and procedures as of a date within 90 days of the filing date of the report. (b) There were no changes in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. Item 11. Exhibits. (a) The Code of Ethics for Principal Executive and Senior Financial Officers is attached hereto. (b)(1) A certification for the Principal Executive Officer of the registrant is attached hereto as part of EX-99.CERT. (b)(2) A certification for the Principal Financial Officer of the registrant is attached hereto as part of EX-99.CERT. 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. (Registrant) Van Kampen Municipal Income Trust By: /s/ Ronald E. Robison --------------------- Name: Ronald E. Robison Title: Principal Executive Officer Date: August 19, 2004 Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By: /s/ Ronald E. Robison --------------------- Name: Ronald E. Robison Title: Principal Executive Officer Date: August 19, 2004 By: /s/ James M. Dykas --------------------- Name: James M. Dykas Title: Principal Financial Officer Date: August 19, 2004 EX-99.CODE 2 c86777exv99wcode.txt CODE OF ETHICS CODE OF ETHICS FOR PRINCIPAL EXECUTIVE AND SENIOR FINANCIAL OFFICERS ADOPTED JULY 23, 2003, AS AMENDED AUGUST 11, 2004 I. This Code of Ethics (the "Code") for the investment companies within the Van Kampen complex identified in Exhibit A (collectively, "Funds" and each, a "Fund") applies to each Fund's Principal Executive Officer, President, Principal Financial Officer and Treasurer (or persons performing similar functions) ("Covered Officers" each of whom are set forth in Exhibit B) for the purpose of promoting: - honest and ethical conduct, including the ethical handling of actual or apparent conflicts of interest between personal and professional relationships. - full, fair, accurate, timely and understandable disclosure in reports and documents that a company files with, or submits to, the Securities and Exchange Commission ("SEC") and in other public communications made by the Fund; - compliance with applicable laws and governmental rules and regulations; - prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and - accountability for adherence to the Code. Each Covered Officer should adhere to a high standard of business ethics and should be sensitive to situations that may give rise to actual as well as apparent conflicts of interest. Any question about the application of the Code should be referred to the General Counsel or his/her designee (who is set forth in Exhibit C). II. COVERED OFFICERS SHOULD HANDLE ETHICALLY ACTUAL AND APPARENT CONFLICTS OF INTEREST OVERVIEW. A "conflict of interest" occurs when a Covered Officer's private interest interferes, or appears to interfere, with the interests of, or his service to, the Fund. For example, a conflict of interest would arise if a Covered Officer, or a member of his family, receives improper personal benefits as a result of his position with the Fund. Certain conflicts of interest arise out of the relationships between Covered Officers and the Fund and already are subject to conflict of interest provisions in the Investment Company Act of 1940 ("Investment Company Act") and the Investment Advisers Act of 1940 ("Investment Advisers Act"). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the Fund because of their status as "affiliated persons" (as defined in the Investment Company Act) of the Fund. The Fund's and its investment adviser's compliance programs and procedures are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside the parameters of this Code, unless or until the General Counsel determines that any violation of such programs and procedures is also a violation of this Code. Although typically not presenting an opportunity for improper personal benefit, conflicts may arise from, or as a result of, the contractual relationship between the Fund and its investment adviser of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the Fund or for the investment adviser, or for both), be involved in establishing policies and implementing decisions that will have different effects on the Fund and its investment adviser. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the Fund and the investment adviser and is consistent with the performance by the Covered Officers of their duties as officers of the Fund. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the Funds' Boards of Directors/Trustees ("Boards") that the Covered Officers may also be officers or employees of one or more other investment companies covered by this or other codes. Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the Fund. Each Covered Officer must not: - use his personal influence or personal relationships improperly to influence investment decisions or financial reporting by the Fund whereby the Covered Officer would benefit personally (directly or indirectly) to the detriment of the Fund; - cause the Fund to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit of the Fund; or - use material non-public knowledge of portfolio transactions made or contemplated for, or actions proposed to be taken by, the Fund to trade personally or cause others to trade personally in contemplation of the market effect of such transactions. Each Covered Officer must, at the time of signing this Code, report to the General Counsel all affiliations or significant business relationships outside the Morgan Stanley complex and must update the report annually. Conflict of interest situations should always be approved by the General Counsel and communicated to the relevant Fund or Fund's Board. Any activity or relationship that would present such a conflict for a Covered Officer would likely also present a conflict for the Covered Officer if an immediate member of the Covered Officer's family living in the same household engages in such an activity or has such a relationship. Examples of these include: - service or significant business relationships as a director on the board of any public or private company; - accepting directly or indirectly, anything of value, including gifts and gratuities in excess of $100 per year from any person or entity with which the Fund has current or prospective business dealings, not including occasional meals or tickets for theatre or sporting events or other similar entertainment; provided it is business-related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety; - any ownership interest in, or any consulting or employment relationship with, any of the Fund's service providers, other than its investment adviser, principal underwriter, or any affiliated person thereof; and - a direct or indirect financial interest in commissions, transaction charges or spreads paid by the Fund for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officer's employment, such as compensation or equity ownership. III. DISCLOSURE AND COMPLIANCE - Each Covered Officer should familiarize himself/herself with the disclosure and compliance requirements generally applicable to the Funds; - each Covered Officer must not knowingly misrepresent, or cause others to misrepresent, facts about the Fund to others, whether within or outside the Fund, including to the Fund's Directors/Trustees and auditors, or to governmental regulators and self-regulatory organizations; - each Covered Officer should, to the extent appropriate within his area of responsibility, consult with other officers and employees of the Funds and their investment advisers with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the Funds file with, or submit to, the SEC and in other public communications made by the Funds; and - it is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations. IV. REPORTING AND ACCOUNTABILITY Each Covered Officer must: - upon adoption of the Code (thereafter as applicable, upon becoming a Covered Officer), affirm in writing to the Boards that he has received, read and understands the Code; - annually thereafter affirm to the Boards that he has complied with the requirements of the Code; - not retaliate against any other Covered Officer, other officer or any employee of the Funds or their affiliated persons for reports of potential violations that are made in good faith; and - notify the General Counsel promptly if he/she knows or suspects of any violation of this Code. Failure to do so is itself a violation of this Code. The General Counsel is responsible for applying this Code to specific situations in which questions are presented under it and has the authority to interpret this Code in any particular situation. However, any waivers(3) sought by a Covered Officer must be considered by the Board of the relevant Fund or Funds. The Funds will follow these procedures in investigating and enforcing this Code: - the General Counsel will take all appropriate action to investigate any potential violations reported to him; - if, after such investigation, the General Counsel believes that no violation has occurred, the General Counsel is not required to take any further action; - any matter that the General Counsel believes is a violation will be reported to the relevant Fund's Audit Committee; - if the directors/trustees/managing general partners who are not "interested persons" as defined by the Investment Company Act (the "Independent Directors/Trustees/Managing General Partners") of the relevant Fund concur that a violation has occurred, they will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a - -------- (3) Item 2 of Form N-CSR defines "waiver" as "the approval by the registrant of a material departure from a provision of the code of ethics." recommendation to dismiss the Covered Officer or other appropriate disciplinary actions; - the Independent Directors/Trustees/Managing General Partners of the relevant Fund will be responsible for granting waivers of this Code, as appropriate; and - any changes to or waivers of this Code will, to the extent required, be disclosed as provided by SEC rules. V. OTHER POLICIES AND PROCEDURES This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act of 2002 and the rules and forms applicable to registered investment companies thereunder. Insofar as other policies or procedures of the Funds, the Funds' investment advisers, principal underwriters, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with the provisions of this Code unless any provision of this Code conflicts with any applicable federal or state law, in which case the requirements of such law will govern. The Funds' and their investment advisers' and principal underwriters' codes of ethics under Rule 17j-1 under the Investment Company Act and Morgan Stanley's Code of Ethics are separate requirements applying to the Covered Officers and others, and are not part of this Code. VI. AMENDMENTS Any amendments to this Code, other than amendments to Exhibits A, B or C, must be approved or ratified by a majority vote of the Board of each Fund, including a majority of Independent Directors/Trustees/Managing General Partners. VII. CONFIDENTIALITY All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the Independent Directors/Trustees/Managing General Partners of the relevant Fund or Funds and their counsel, the relevant Fund or Funds and their counsel and the relevant investment adviser and its counsel. VIII. INTERNAL USE The Code is intended solely for the internal use by the Funds and does not constitute an admission, by or on behalf of any Fund, as to any fact, circumstance, or legal conclusion I have read and understand the terms of the above Code. I recognize the responsibilities and obligations incurred by me as a result of my being subject to the Code. I hereby agree to abide by the above Code. - ------------------------- Date: -------------------- EXHIBIT A FUND LIST Van Kampen Series Fund, Inc. on behalf of its series Van Kampen American Value Fund Van Kampen Emerging Markets Debt Fund Van Kampen Emerging Markets Income Fund Van Kampen Emerging Markets Fund Van Kampen Equity Growth Fund Van Kampen Focus Equity Fund Van Kampen Global Equity Allocation Fund Van Kampen Global Value Equity Fund Van Kampen Growth and Income Fund II Van Kampen International Magnum Fund Van Kampen Japanese Equity Fund Van Kampen Global Franchise Fund Van Kampen U.S. Government Trust on behalf of its series Van Kampen U.S. Mortgage Fund Van Kampen Tax Free Trust on behalf of its series Van Kampen Insured Tax Free Income Fund Van Kampen Strategic Municipal Income Fund Van Kampen California Insured Tax Free Fund Van Kampen Municipal Income Fund Van Kampen Intermediate Term Municipal Income Fund Van Kampen New York Tax Free Income Fund Van Kampen California Municipal Income Fund Van Kampen Michigan Tax Free Income Fund Van Kampen Missouri Tax Free Income Fund Van Kampen Ohio Tax Free Income Fund Van Kampen Trust on behalf of its series Van Kampen High Yield Fund Van Kampen Managed Short Term Income Fund Van Kampen Equity Trust on behalf of its series Van Kampen Utility Fund Van Kampen Mid Cap Growth Fund Van Kampen Aggressive Growth Fund Van Kampen Small Cap Value Fund Van Kampen Select Growth Fund EXHIBIT A (CONT.) FUND LIST Van Kampen Small Company Growth Fund Van Kampen Small Cap Growth Fund Van Kampen Value Opportunities Fund Van Kampen Tax-Exempt Trust on behalf of its Series Van Kampen High Yield Municipal Fund Van Kampen Equity Trust II on behalf of its Series Van Kampen Technology Fund Van Kampen International Advantage Van Kampen Pennsylvania Tax Free Income Fund Van Kampen Tax Free Money Fund Van Kampen Comstock Fund Van Kampen Corporate Bond Fund Van Kampen Emerging Growth Fund Van Kampen Enterprise Fund Van Kampen Equity Income Fund Van Kampen Government Securities Fund Van Kampen Growth and Income Fund Van Kampen Harbor Fund Van Kampen High Income Corporate Bond Fund Van Kampen Limited Maturity Government Fund Van Kampen Pace Fund Van Kampen Real Estate Securities Fund Van Kampen Reserve Fund Van Kampen Exchange Fund Van Kampen Life Investment Trust on behalf of its Portfolios Aggressive Growth Portfolio Comstock Portfolio Emerging Growth Portfolio Enterprise Portfolio Government Portfolio Growth and Income Portfolio Money Market Portfolio Van Kampen Municipal Income Trust Van Kampen California Municipal Trust EXHIBIT A (CONT.) FUND LIST Van Kampen High Income Trust Van Kampen High Income Trust II Van Kampen Investment Grade Municipal Trust Van Kampen Municipal Trust Van Kampen California Quality Municipal Trust Van Kampen Florida Quality Municipal Trust Van Kampen New York Quality Municipal Trust Van Kampen Ohio Quality Municipal Trust Van Kampen Pennsylvania Quality Municipal Trust Van Kampen Trust for Insured Municipals Van Kampen Trust for Investment Grade Municipals Van Kampen Trust for Investment Grade California Municipals Van Kampen Trust for Investment Grade Florida Municipals Van Kampen Trust for Investment Grade New Jersey Municipals Van Kampen Trust for Investment Grade New York Municipals Van Kampen Trust for Investment Grade Pennsylvania Municipals Van Kampen Municipal Opportunity Trust Van Kampen Advantage Municipal Income Trust Van Kampen Advantage Pennsylvania Municipal Income Trust Van Kampen Strategic Sector Municipal Trust Van Kampen Value Municipal Income Trust Van Kampen California Value Municipal Income Trust Van Kampen Massachusetts Value Municipal Income Trust Van Kampen New York Value Municipal Income Trust Van Kampen Ohio Value Municipal Income Trust Van Kampen Pennsylvania Value Municipal Income Trust Van Kampen Municipal Opportunity Trust II Van Kampen Advantage Municipal Income Trust II Van Kampen Select Sector Municipal Trust Van Kampen Senior Loan Fund Van Kampen Senior Income Trust Van Kampen Bond Fund Van Kampen Income Trust EXHIBIT B COVERED OFFICERS Mitchell M. Merin -- President Ronald E. Robison -- Executive Vice President and Principal Executive Officer James M. Dykas -- Chief Financial Officer and Treasurer EXHIBIT C GENERAL COUNSEL'S DESIGNEE Amy Doberman EX-99.CERT 3 c86777exv99wcert.txt CERTIFICATION I, Ronald E. Robison, certify that: 1. I have reviewed this report on Form N-CSR of Van Kampen Municipal Income Trust; 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 registrant's other certifying officers 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) 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) [Omitted] c) evaluated the effectiveness of the registrant's 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 registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's 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 registrant's 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 registrant's internal controls over financial reporting. Date: August 19, 2004 /s/ Ronald E. Robison ------------------------- Principal Executive Officer I, James M. Dykas, certify that: 1. I have reviewed this report on Form N-CSR of Van Kampen Municipal Income Trust; 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 registrant's other certifying officers 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) 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) [Omitted] c) evaluated the effectiveness of the registrant's 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 registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer(s) and I have disclosed to the registrant's auditors and the audit committee of the registrant's 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 registrant's 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 registrant's internal controls over financial reporting. Date: August 19, 2004 /s/ James M. Dykas -------------------- Principal Financial Officer EX-99.906CERT 4 c86777exv99w906cert.txt 906 CERTIFICATION Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Name of Issuer: Van Kampen Municipal Income Trust In connection with the Report on Form N-CSR (the "Report") of the above-named issuer for the period ended June 30, 2004 that is accompanied by this certification, the undersigned hereby certifies that: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Issuer. Date: August 19, 2004 /s/ Ronald E. Robison --------------------- Ronald E. Robison Principal Executive Officer A signed original of this written statement required by Section 906 has been provided to Van Kampen Municipal Income Trust and will be retained by Van Kampen Municipal Income Trust and furnished to the Securities and Exchange Commission or its staff upon request. This written statement required by Section 906 is being furnished with this report, but not being filed as part of this Report. Certification Pursuant to 18 U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 Name of Issuer: Van Kampen Municipal Income Trust In connection with the Report on Form N-CSR (the "Report") of the above-named issuer for the period ended June 30, 2004 that is accompanied by this certification, the undersigned hereby certifies that: 1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Issuer. Date: August 19, 2004 /s/ James M. Dykas ------------------- James M. Dykas Principal Financial Officer A signed original of this written statement required by Section 906 has been provided to Van Kampen Municipal Income Trust and will be retained by Van Kampen Municipal Income Trust and furnished to the Securities and Exchange Commission or its staff upon request. This written statement required by Section 906 is being furnished with this report, but not being filed as part of this Report. -----END PRIVACY-ENHANCED MESSAGE-----