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Centennial California Tax Exempt Trust
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6803 South Tucson Way, Englewood, Colorado 80112
1.800.525.9310


Statement of Additional Information dated November 1, 2001 revised July 1, 2002.


         This Statement of Additional Information is not a prospectus.  This document contains additional information about the Trust
and supplements information in the Prospectus dated November 1, 2001.  It should be read together with the Prospectus, which may be
obtained by writing to the Trust's Transfer Agent, Shareholder Services, Inc., at P.O. Box 5143, Denver, Colorado 80217, or by
calling the Transfer Agent at the toll-free number shown above.

Contents
                                                                                                             Page
About the Trust
Additional Information about the Trust's Investment Policies and Risks............................................2
     The Trust's Investment Policies..............................................................................2
     Other Investment Strategies..................................................................................9
     Investment Restrictions.....................................................................................15

How the Trust is Managed.........................................................................................17
     Organization and History....................................................................................17
     Trustees and Officers of the Trust..........................................................................18
     The Manager...................................................................................................25
Service Plan.....................................................................................................27
Performance of the Trust.........................................................................................28


About Your Account

How To Buy Shares................................................................................................32
How To Sell Shares...............................................................................................33
How To Exchange Shares...........................................................................................34
Dividends and Taxes..............................................................................................36
Additional Information About the Trust...........................................................................38


Financial Information About the Trust

Independent Auditors' Report.....................................................................................39
Financial Statements.............................................................................................40


Appendix A: Description of Securities Ratings...................................................................A-1
Appendix B: Municipal Bond Industry Classifications.............................................................B-1






                                                                32
                                                                   2
A B O U T  T H E  T R U S T

Additional Information About the Trust's Investment Policies and Risks

The investment objective and the principal investment policies of the Trust are described in the Prospectus.  This Statement of
Additional Information contains supplemental information about those policies and the types of securities that the Trust's investment
manager, Centennial Asset Management Corporation (referred to as the "Manager"), will select for the Trust. Additional explanations
are also provided about the strategies the Trust may use to try to achieve its objective.

The Trust's Investment Policies. The composition of the Trust's portfolio and the techniques and strategies that the Trust's Manager
uses in selecting portfolio securities will vary over time.  The Trust is not required to use all of the investment techniques and
strategies described below at all times in seeking its goal.  It may use some of the special investment techniques and strategies at
some times or not at all.

         The Trust will not make investments with the objective of seeking capital growth.  However, the value of the securities held
by the Trust may be affected by changes in general interest rates.  Because the current value of debt securities varies inversely
with changes in prevailing interest rates, if interest rates increase after a security is purchased, that security would normally
decline in value.  Conversely, if interest rates decrease after a security is purchased, its value would rise.  However, those
fluctuations in value will not generally result in realized gains or losses to the Trust since the Trust does not usually intend to
dispose of securities prior to their maturity.  A debt security held to maturity is redeemable by its issuer at full principal value
plus accrued interest.

         The Trust may sell securities prior to their maturity, to attempt to take advantage of short-term market variations, or
because of a revised credit evaluation of the issuer or other considerations. The Trust may also do so to generate cash to satisfy
redemptions of Trust shares.  In such cases, the Trust may realize a capital gain or loss on the security.

         There are variations in the credit quality of municipal securities, both within a particular rating classification and
between classifications. These variations depend on numerous factors. The yields of municipal securities depend on a number of
factors, including general conditions in the municipal securities market, the size of a particular offering, the maturity of the
obligation and rating (if any) of the issue. These factors are discussed in greater detail below.

Municipal Securities.  The types of municipal securities in which the Trust may invest are described in the Prospectus under "About
the Trust's Investments." Municipal securities are generally classified as general obligation bonds, revenue bonds and notes. A
discussion of the general characteristics of these principal types of municipal securities follows below.

         |X|  Municipal Bonds.  We have classified municipal securities having a maturity (when the security is issued) of more than
one year as "municipal bonds." The principal classifications of long-term municipal bonds are "general obligation" and "revenue"
(including "industrial development") bonds. They may have fixed, variable or floating rates of interest, as described below.
         Some bonds may be "callable," allowing the issuer to redeem them before their maturity date. To protect bondholders,
callable bonds may be issued with provisions that prevent them from being called for a period of time.  Typically, that is 5 to 10
years from the issuance date.  When interest rates decline, if the call protection on a bond has expired, it is more likely that the
issuer may call the bond.  If that occurs, the Trust might have to reinvest the proceeds of the called bond in bonds that pay a lower
rate of return.

           |_|  General Obligation Bonds.  The basic security behind general obligation bonds is the issuer's pledge of its full faith
and credit and taxing power, if any, for the repayment of principal and the payment of interest. Issuers of general obligation bonds
include states, counties, cities, towns, and regional districts.  The proceeds of these obligations are used to fund a wide range of
public projects, including construction or improvement of schools, highways and roads, and water and sewer systems. The rate of taxes
that can be levied for the payment of debt service on these bonds may be limited or unlimited. Additionally, there may be limits as
to the rate or amount of special assessments that can be levied to meet these obligations.

           |_|  Revenue Bonds.  The principal security for a revenue bond is generally the net revenues derived from a particular
facility, group of facilities, or, in some cases, the proceeds of a special excise tax or other specific revenue source.  Revenue
bonds are issued to finance a wide variety of capital projects. Examples include electric, gas, water and sewer systems; highways,
bridges, and tunnels; port and airport facilities; colleges and universities; and hospitals.

         Although the principal security for these types of bonds may vary from bond to bond, many provide additional security in the
form of a debt service reserve fund that may be used to make principal and interest payments on the issuer's obligations.  Housing
finance authorities have a wide range of security, including partially or fully insured mortgages, rent subsidized and/or
collateralized mortgages, and/or the net revenues from housing or other public projects.  Some authorities provide further security
in the form of a state's ability (without obligation) to make up deficiencies in the debt service reserve fund.

           |_|  Industrial Development Bonds.  Industrial development bonds are considered municipal bonds if the interest paid is
exempt from federal income tax. They are issued by or on behalf of public authorities to raise money to finance various privately
operated facilities for business and manufacturing, housing, sports, and pollution control.  These bonds may also be used to finance
public facilities such as airports, mass transit systems, ports, and parking.  The payment of the principal and interest on such
bonds is dependent solely on the ability of the facility's user to meet its financial obligations and the pledge, if any, of real and
personal property financed by the bond as security for those payments.

           |_|  Private Activity Municipal Securities.  The Tax Reform Act of 1986 (the "Tax Reform Act") reorganized, as well as
amended, the rules governing tax exemption for interest on certain types of municipal securities.  The Tax Reform Act generally did
not change the tax treatment of bonds issued in order to finance governmental operations.  Thus, interest on general obligation bonds
issued by or on behalf of state or local governments, the proceeds of which are used to finance the operations of such governments,
continues to be tax-exempt.  However, the Tax Reform Act limited the use of tax-exempt bonds for non-governmental (private)
purposes.  More stringent restrictions were placed on the use of proceeds of such bonds.  Interest on certain private activity bonds
is taxable under the revised rules.  There is an exception for "qualified" tax-exempt private activity bonds, for example, exempt
facility bonds including certain industrial development bonds, qualified mortgage bonds, qualified Section 501(c)(3) bonds, and
qualified student loan bonds.  Normally, the Trust will not invest more than 20% of its total assets in private activity municipal
securities or other taxable investments.

         In addition, limitations as to the amount of private activity bonds which each state may issue were revised downward by the
Tax Reform Act, which will reduce the supply of such bonds.  The value of the Trust's portfolio could be affected if there is a
reduction in the availability of such bonds.

         Interest on certain private activity bonds issued after August 7, 1986, which continues to be tax-exempt, will be treated as
a tax preference item subject to the alternative minimum tax (discussed below) to which certain taxpayers are subject. The Trust may
hold municipal securities the interest on which (and thus a proportionate share of the exempt-interest dividends paid by the Trust)
will be subject to the federal alternative minimum tax on individuals and corporations.

         The federal alternative minimum tax is designed to ensure that all persons who receive income pay some tax, even if their
regular tax is zero.  This is accomplished in part by including in taxable income certain tax preference items that are used to
calculate alternative minimum taxable income.  The Tax Reform Act made tax-exempt interest from certain private activity bonds a tax
preference item for purposes of the alternative minimum tax on individuals and corporations.  Any exempt-interest dividend paid by a
regulated investment company will be treated as interest on a specific private activity bond to the extent of the proportionate
relationship the interest the investment company receives on such bonds bears to all its exempt interest dividends.

         In addition, corporate taxpayers subject to the alternative minimum tax may, under some circumstances, have to include
exempt-interest dividends in calculating their alternative minimum taxable income. That could occur in situations where the "adjusted
current earnings" of the corporation exceeds its alternative minimum taxable income.

         To determine whether a municipal security is treated as a taxable private activity bond, it is subject to a test for: (a) a
trade or business use and security interest, or (b) a private loan restriction. Under the trade or business use and security interest
test, an obligation is a private activity bond if: (i) more than 10% of the bond proceeds are used for private business purposes and
(ii) 10% or more of the payment of principal or interest on the issue is directly or indirectly derived from such private use or is
secured by the privately used property or the payments related to the use of the property. For certain types of uses, a 5% threshold
is substituted for this 10% threshold.

         The term "private business use" means any direct or indirect use in a trade or business carried on by an individual or
entity other than a state or municipal governmental unit.  Under the private loan restriction, the amount of bond proceeds that may
be used to make private loans is limited to the lesser of 5% or $5.0 million of the proceeds.  Thus, certain issues of municipal
securities could lose their tax-exempt status retroactively if the issuer fails to meet certain requirements as to the expenditure of
the proceeds of that issue or the use of the bond-financed





facility. The Trust makes no independent investigation of the users of such bonds or their use of proceeds of the bonds.  If the
Trust should hold a bond that loses its tax-exempt status retroactively, there might be an adjustment to the tax-exempt income
previously distributed to shareholders.

         Additionally, a private activity bond that would otherwise be a qualified tax-exempt private activity bond will not, under
Internal Revenue Code Section 147(a), be a qualified bond for any period during which it is held by a person who is a "substantial
user" of the facilities or by a "related person" of such a substantial user.  This "substantial user" provision applies primarily to
exempt facility bonds, including industrial development bonds. The Trust may invest in industrial development bonds and other private
activity bonds. Therefore, the Trust may not be an appropriate investment for entities which are "substantial users" (or persons
related to "substantial users") of such exempt facilities. Those entities and persons should consult their tax advisers before
purchasing shares of the Trust.

         A "substantial user" of such facilities is defined generally as a "non-exempt person who regularly uses part of a facility"
financed from the proceeds of exempt facility bonds.  Generally, an individual will not be a "related person" under the Internal
Revenue Code unless such individual or the individual's immediate family (spouse, brothers, sisters and immediate descendants) own
directly or indirectly in the aggregate more than 50% in value of the equity of a corporation or partnership which is a "substantial
user" of a facility financed from the proceeds of exempt facility bonds.

         |X|  Municipal Notes.  Municipal securities having a maturity (when the security is issued) of one year or less are generally
known as municipal notes. Municipal notes generally are used to provide for short-term working capital needs. Some of the types of
municipal notes the Trust can invest in are described below.

           |_|  Tax Anticipation Notes.  These are issued to finance working capital needs of municipalities.  Generally, they are
issued in anticipation of various seasonal tax revenue, such as income, sales, use or other business taxes, and are payable from
these specific future taxes.

           |_|  Revenue Anticipation Notes.  These are notes issued in expectation of receipt of other types of revenue, such as
federal revenues available under federal revenue-sharing programs.

           |_|  Bond Anticipation Notes.  Bond anticipation notes are issued to provide interim financing until long-term financing
can be arranged.  The long-term bonds that are issued typically also provide the money for the repayment of the notes.

           |_|  Construction Loan Notes.  These are sold to provide project construction financing until permanent financing can be
secured.  After successful completion and acceptance of the project, it may receive permanent financing through public agencies, such
as the Federal Housing Administration.






         |X|  Tax Exempt Commercial Paper.  This type of short-term obligation (usually having a maturity of 270 days or less) is
issued by a municipality to meet current working capital needs.

         |X|  Municipal Lease Obligations.  The Trust's investments in municipal lease obligations may be through certificates of
participation that are offered to investors by public entities. Municipal leases may take the form of a lease or an installment
purchase contract issued by a state or local government authority to obtain funds to acquire a wide variety of equipment and
facilities.

         Some municipal lease securities may be deemed to be "illiquid" securities. Their purchase by the Trust would be limited as
described below in "Illiquid Securities." From time to time the Trust may invest more than 5% of its net assets in municipal lease
obligations that the Manager has determined to be liquid under guidelines set by the Board of Trustees. Those guidelines require the
Manager to evaluate:
         |_|  the frequency of trades and price quotations for such securities;
         |_|  the number of dealers or other potential buyers willing to purchase or sell such securities;
         |_|  the availability of market-makers; and
         |_|  the nature of the trades for such securities.

         Municipal leases have special risk considerations. Although lease obligations do not constitute general obligations of the
municipality for which the municipality's taxing power is pledged, a lease obligation is ordinarily backed by the municipality's
covenant to budget for, appropriate and make the payments due under the lease obligation.  However, certain lease obligations contain
"non-appropriation" clauses which provide that the municipality has no obligation to make lease or installment purchase payments in
future years unless money is appropriated for that purpose on a yearly basis.  While the obligation might be secured by the lease, it
might be difficult to dispose of that property in case of a default.

         Projects financed with certificates of participation generally are not subject to state constitutional debt limitations or
other statutory requirements that may apply to other municipal securities.  Payments by the public entity on the obligation
underlying the certificates are derived from available revenue sources.  That revenue might be diverted to the funding of other
municipal service projects.  Payments of interest and/or principal with respect to the certificates are not guaranteed and do not
constitute an obligation of a state or any of its political subdivisions.

         In addition to the risk of "non-appropriation," municipal lease securities do not have as highly liquid a market as
conventional municipal bonds. Municipal leases, like other municipal debt obligations, are subject to the risk of non-payment of
interest or repayment of principal by the issuer. The ability of issuers of municipal leases to make timely lease payments may be
adversely affected in general economic downturns and as relative governmental cost burdens are reallocated among federal, state and
local governmental units.  A default in payment of income would result in a reduction of income to the Trust. It could also result in
a reduction in the value of the municipal lease and that, as well as a default in repayment of principal, could result in a decrease
in the net asset value of the Trust.  While the Trust holds such securities, the Manager will also evaluate the likelihood of a
continuing market for these securities and their credit quality.

Ratings of Securities - Portfolio Quality, Maturity and Diversification.  Under Rule 2a-7 of the Investment Company Act, the Trust
uses the amortized cost method to value its portfolio securities to determine the Trust's net asset value per share.  Rule 2a-7
imposes requirements for the maturity, quality and diversification of the securities which the Trust buys.  The Trust may purchase
only those securities that the Manager, under procedures approved by the Board of Trustees, has determined have minimal credit risk
and, as such, are "eligible securities".

         |_|  Quality.  Eligible securities are securities that have received a rating in one of the two highest short-term rating
categories by a rating organization.  Rating organizations are designated by the SEC.  Eligible securities may be "first tier" or
"second tier" securities.  First tier securities are those that have received a rating in the highest category for short term debt
obligations by at least two rating organizations.  If only one rating organization has rated the security, it must be rated in the
highest category for that rating organization.  U.S. government securities and securities issued by a registered money market mutual
fund are also first tier securities.

         The Trust may also buy second tier "conduit securities".  These eligible securities are securities rated by rating
organizations but are not first tier securities.  Conduit securities are municipal securities such as industrial development or
revenue bonds issued to finance non-government projects.  The payment of the principal and interest on a conduit security is not the
obligation of the municipal issuer, but is the obligation of another person who is ultimately responsible for the payment of
principal and interest, such as the user of the facility.  The Trust may not invest more than 5% of its total assets in second tier
conduit securities.

         The Trust may also buy unrated securities that the Manager determines are comparable in quality to a first or second tier
security by applying certain criteria established by the Board to determine its creditworthiness.  These criteria require a high
quality short term or long-term rating (depending on the security) from a rating organization.  Unrated securities the Trust may buy
include asset backed securities and securities subject to "demand features" or "guarantees".

         The Trust may purchase a security subject to a guarantee if the guarantee is an eligible security or a first tier security.
The trust may also purchase a security subject to a "conditional" demand feature if the demand feature is an eligible security and
the Manager has decided that the conditional demand feature meets the requirements imposed by Rule 2a-7.

         If a security's rating is downgraded, the Manager or the Board of Trustees may have to reassess the security's credit risk.
If a security is downgraded, the Manager or the Board of Trustees will promptly reassess whether the security continues to present
minimal credit risk, reassess the status of the security as an "eligible security," and take such actions as is appropriate. If the
Trust disposes of the security within five days of the Manager learning of the downgrade, the Manager will provide the Board of
Trustees with subsequent notice of such downgrade.  If a security is in default, or ceases to be an eligible security, or is
determined no longer to present minimal credit risks, the Board of Trustees must determine whether it would be in the best interests
of the Trust to dispose of the security.





         |_|  Diversification.  With respect to 75% of its total assets, the Trust cannot invest more than 5% of its total assets in
securities issued by one issuer.  It cannot invest more than 5% of its total assets in securities of one issuer unless the security
is a first tier security.  The Trust also cannot invest more than 1% of its total assets or $1.0 million, whichever is greater, in
second tier securities of one issuer.  For diversification purposes, the Trust is considered to have purchased the security
underlying a repurchase agreement if the repurchase agreement is fully collateralized.  For a refunded security, the Trust is
considered to have the U.S. government securities underlying the refunded security.  For conduit securities, the Trust considers the
issuer to be the person ultimately responsible for payment of the obligation.  If the Trust buys an asset backed security, the issuer
of the security is deemed to be the "special purpose" entity which issued the security.  A special purpose entity is an entity which
is organized solely for the purpose of issuing asset backed securities.  If the asset backed securities issued by the special purpose
entity include the obligations of another person or another special purpose entity and those obligations amount to 10% or more of the
asset backed securities the Trust buys, that other person or entity is considered to be the issuer of a pro rata percentage of the
asset backed security.

         The Trust may buy a security subject to a demand feature or guarantee.  In this case, with respect to 75% of its total
assets, the Trust may not invest more than 10% of its total assets in securities issued by or subject to demand features or
guarantees issued by the same issuer.  If the demand feature or guarantee is a second tier security, the Trust may not invest more
than 5% of its total assets in securities subject to demand features or guarantees from the same issuer.  And, the Trust may not
invest more than 10% of its total assets in securities issued by or subject to demand features or guarantees from the same issuer.
However, if the demand feature or guarantee is issued by a person who is a non-controlled person, the Trust does not have to limit
its investments to no more than 10% of its total assets in securities issued by or subject to demand features or guarantees from the
same issuer.

         |_|  Maturity.  The Trust must maintain a dollar-weighted average portfolio maturity of not more than 90 days, and the
maturity of any single security must not be in excess the maximum permitted maturity under Rule 2a-7 (or any other applicable rule)
which is currently 397 days from the date of purchase.  The Trust also may buy adjustable and floating rate securities, enter into
repurchase agreements and lend portfolio securities.  Rule 2a-7 defines how the maturities of these securities are determined.

         |_|  Demand Features and Guarantees.  Demand features and guarantees and some of their uses are described in the Prospectus.
The Trust also uses demand features and guarantees to satisfy the maturity, quality and diversifications requirements described
above.  The Trust considers the person which issues the demand feature as the person to whom the Trust will look for payment.  An
unconditional demand feature is considered a guarantee and the Trust looks to the person making the guarantee for payment of the
obligation of the underlying security.

         When the Trust buys municipal securities, it may obtain a demand feature from the seller to repurchase the securities that
entitles the Trust to achieve same day settlement from the repurchaser and to receive an exercise price equal to the amortized cost
of the underlying security plus accrued interest, if any, at the time of exercise.  Another type of demand feature purchased in
conjunction with a Municipal Security enables the Trust to sell the underlying security within a specified period of time at a fixed
exercise price.  The Trust may pay for demand features either separately in cash or by paying a higher price for the securities
acquired subject to the demand features.  The Trust will enter into these transactions only with banks and dealers which, in the
Manager's opinion, present minimal credit risks.  The Trust's purchases of demand features are subject to the provisions of Rule 2a-7
under the Investment Company Act because the Trust uses the amortized cost method to value its portfolio securities.

         The Trust's ability to exercise a demand feature or guarantee will depend on the ability of the bank or dealer to pay for
the securities if the demand feature or guarantee is exercised.  If the bank or dealer should default on its obligation, the Trust
might not be able to recover all or a portion of any loss sustained from having to sell the security elsewhere.  Demand features and
guarantees are not transferable by the Trust, and therefore terminate if the Trust sells the underlying security to a third party.
The Trust intends to enter into these arrangements to facilitate portfolio liquidity, although such arrangements may enable the Trust
to sell a security at a pre-arranged price which may be higher than the prevailing market price at the time the demand feature or
guarantee is exercised. Any considerations paid by the Trust for the demand feature (which increases the cost of the security and
reduces the yield otherwise available for the security) will be reflected on the Trust's books as unrealized depreciation while the
demand feature or guarantee is held, and a realized gain or loss when demand feature is exercised or expires.

Other Investment Strategies

Floating Rate/Variable Rate Obligations.  The Trust may invest in instruments with floating or variable interest rates.  The interest
rate on a floating rate obligation is based on a stated prevailing market rate, such as a bank's prime rate, the 90-day U.S. Treasury
Bill rate, the rate of return on commercial paper or bank certificates of deposit, or some other standard.  The rate on the
investment is adjusted automatically each time the market rate is adjusted.  The interest rate on a variable rate obligation is also
based on a stated prevailing market rate but is adjusted automatically at a specified interval.  Some variable rate or floating rate
obligations in which the Trust may invest have a demand feature entitling the holder to demand payment of an amount approximately
equal to the amortized cost of the instrument or the principal amount of the instrument plus accrued interest at any time, or at
specified intervals not exceeding the maximum time permitted under Rule 2a-7 (which is currently 397 days).  These notes may or may
not be backed by bank letters of credit.

         Variable rate demand notes may include master demand notes, which are obligations that permit the Trust to invest
fluctuating amounts in a note.  The amount may change daily without penalty, pursuant to direct arrangements between the Trust, as
the note purchaser, and the issuer of the note.  The interest rates on these notes fluctuate from time to time.  The issuer of this
type of obligation normally has a corresponding right in its discretion, after a given period, to prepay the outstanding principal
amount of the obligation plus accrued interest.  The issuer must give a specified number of days' notice to the holders of those
obligations.  Generally, the changes in the interest rate on those securities reduce the fluctuation in their market value.  As
interest rates decrease or increase, the potential for capital appreciation or depreciation is less than that for fixed-rate
obligations having the same maturity.

         Because these types of obligations are direct lending arrangements between the note purchaser and issuer of the note, these
instruments generally will not be traded.  Generally, there is no established secondary market for these types of obligations,
although they are redeemable from the issuer at face value.  Accordingly, where these obligations are not secured by letters of
credit or other credit support arrangements, the Trust's right to redeem them is dependent on the ability of the note issuer to pay
principal and interest on demand.  These types of obligations usually are not rated by credit rating agencies.  The Trust may invest
in obligations that are not rated only if the Manager determines at the time of investment that they are Eligible Securities.  The
Manager, on behalf of the Trust, will monitor the creditworthiness of the issuers of the floating and variable rate obligations in
the Trust's portfolio on an ongoing basis.  There is no limit on the amount of the Trust's assets that may be invested in floating
rate and variable rate obligations that meet the requirements of Rule 2a-7.

When-Issued and Delayed Delivery Transactions.  As stated in the Prospectus, the Trust may invest in municipal securities on a
"when-issued" or "delayed delivery" basis. Payment for and delivery of the securities shall not exceed 120 days from the date the
offer is accepted.  The purchase price and yield are fixed at the time the buyer enters into the commitment.  During the period
between the time of commitment and settlement, no payment is made by the Trust to the issuer and no interest accrues to the Trust
from this investment.  However, the Trust intends to be as fully invested as possible and will not invest in when-issued securities
if its income or net asset value will be materially adversely affected.  At the time the Trust makes the commitment to purchase a
municipal security on a when-issued basis, it will record the transaction on its books and reflect the value of the security in
determining its net asset value.  It will also segregate cash or other liquid high quality municipal securities equal in value to the
commitment for the when-issued securities. While when-issued securities may be sold prior to settlement date, the Trust intends to
acquire the securities upon settlement unless a prior sale appears desirable for investment reasons.  There is a risk that the yield
available in the market when delivery occurs may be higher than the yield on the security acquired.

Repurchase Agreements.  In a repurchase transaction, the Trust acquires a security from, and simultaneously resells it to, an
approved vendor (a U.S. commercial bank or the U.S. branch of a foreign bank having total domestic assets of at least $1 billion or a
broker-dealer with a net capital of at least $50 million and which has been designated a primary dealer in government securities).
The resale price exceeds the purchase price by an amount that reflects an agreed-upon interest rate effective for the period during
which the repurchase agreement is in effect.  The majority of these transactions run from day to day, and delivery pursuant to the
resale typically will occur within one to five days of the purchase.  Repurchase agreements are considered "loans" under the
Investment Company Act of 1940, as amended (the "Investment Company Act") collateralized by the underlying security.  The Trust's
repurchase agreements require that at all times while the repurchase agreement is in effect, the value of the collateral must equal
or exceed the repurchase price to fully collateralize the repayment obligation.  Additionally, the Manager will monitor the vendor's
creditworthiness to confirm that the vendor is financially sound and will continuously monitor the collateral's value.

Bank Loan Participation Agreements.  The Fund may invest in bank loan participation agreements, subject to the investment limitation
set forth in the Prospectus as to investments in illiquid securities.  Participation agreements provide an undivided interest in a
loan made by the bank issuing the participation interest in the proportion that the buyer's investment bears to the total principal
amount of the loan.  Under this type of arrangement, the issuing bank may have no obligation to the buyer other than to pay principal
and interest on the loan if and when received by the bank.  Thus, the Fund must look to the creditworthiness of the borrower, which
is obligated to make payments of principal and interest on the loan.  If the borrower fails to pay scheduled principal or interest
payments, the Fund may experience a reduction in income.

Loans of Portfolio Securities.  To attempt to increase its income, the Trust may lend its portfolio securities to qualified borrowers
(other than in repurchase transactions).  There are risks in connection with securities lending. The Trust might experience a delay
in receiving additional collateral to secure a loan, or a delay in recovery of the loaned securities. The Trust presently does not
intend to lend securities; but if it does, these loans cannot exceed 25% of the value of the Trust's total assets.  Income from
securities loans does not constitute exempt-interest income for the purpose of paying tax-exempt dividends.

         The Trust must receive collateral for a loan.  Under current applicable regulatory requirements (which are subject to
change), on each business day the loan collateral must be at least equal to the value of the loaned securities.  It must consist of
cash, bank letters of credit, securities of the U.S. government or its agencies or instrumentalities, or other cash equivalents in
which the Trust is permitted to invest.  To be acceptable as collateral, letters of credit must obligate a bank to pay amounts
demanded by the Trust if the demand meets the terms of the letter.  The terms of the letter of credit and the issuing bank both must
be satisfactory to the Trust.

         When it lends securities, the Trust receives amounts equal to the dividends or interest on the loaned securities.  It also
receives one or more of (a) negotiated loan fees, (b) interest on securities used as collateral, and (c) interest on short-term debt
securities purchased with the loan collateral. Either type of interest may be shared with the borrower.  The Trust may pay reasonable
finder's, administrative or other fees in connection with these loans.  The terms of the Trust's loans must meet applicable tests
under the Internal Revenue Code and must permit the Trust to reacquire loaned securities on five days' notice or in time to vote on
any important matter.

Special Risks of Investing Primarily in California Municipal Securities.  Because the Trust focuses its investments primarily on
California municipal securities, the value of its portfolio investments will be highly sensitive to events affecting the fiscal
stability of the State of California and its municipalities, authorities and other instrumentalities that issue securities.  There
have been a number of political developments, voter initiatives, state constitutional amendments and legislation in California in
recent years that may affect the ability of the State government and municipal governments to pay interest and repay principal on the
securities they have issued.  In addition, in recent years, the State of California has derived a significant portion of its revenues
from personal income and sales taxes.  Because the amount collected from these taxes is particularly sensitive to economic
conditions, the State's revenues have been volatile.

         It is not possible to predict the future impact of the legislation and economic considerations described below on the
long-term ability of the State of California or California municipal issuers to pay interest or repay principal on their
obligations.  In part that is because of possible inconsistencies in the terms of the various laws and Propositions and the
applicability of other statutes to these issues.  The budgets of California counties and local governments may be significantly
affected by state budget decisions beyond their control.  The information below about these conditions is only a brief summary, based
upon information the Trust has drawn from sources that it believes are reliable.

         o    Changes to the State Constitution.  Changes to the state constitution in recent years have raised general concerns about
the ability of the State and municipal governments in California to obtain sufficient revenues to pay their bond obligations.  In
1978, California voters approved Proposition 13, an amendment to the state constitution.  The Proposition added a new section to the
constitution that limits ad valorem taxes on real property and restricts the ability of local taxing entities to increase real
property taxes.  However, legislation enacted after Proposition 13 provided help to California municipal issuers to raise revenue to
pay their bond obligations.  During the severe recession California experienced from 1991 to 1993, the State legislature eliminated
significant components of its aid to local governments.  The State has since increased aid to local governments and reduced certain
mandates for local services.  Whether legislation will be enacted in the future to either increase or reduce the redistribution of
State revenues to local governments, or to make them less dependent on State budget decisions, cannot be predicted.  Even if
legislation increasing such redistribution is passed, it cannot be predicted whether in every instance it will provide sufficient
revenue for local municipal issuers to pay their bond obligations.

         Another amendment to the state constitution may also have an adverse impact on state and municipal bond obligations.  That
amendment restricts the state government from spending amounts in excess of appropriation limits imposed on each state and local
government entity.  If revenues exceed the appropriation limit, those revenues must be returned, in the form of a revision in the tax
rates or fee schedules.

         o    Voter Initiatives.  California voters have approved a number of initiatives that affect the ability of the state and
municipalities to finance their bond obligations.  In 1988, California voters approved Proposition 98, which requires a minimum level
of funding for public schools and community colleges.  In 1986, voters approved Proposition 62, which had a number of effects. One
requires that any special tax imposed by a local government must be approved by a two-thirds vote of the electorate.  In 1995, the
California Supreme Court upheld the constitutionality of that Proposition.  That created uncertainty as to the legality of certain
local taxes enacted by non-charter cities without voter approval. It is not possible to predict the eventual impact of that decision.

         In 1996, California voters approved Proposition 218.  That initiative applied the provisions of Proposition 62 to all
government entities, including cities having charters.  It requires that all taxes for general purposes be approved by a simple
majority of the popular vote, and that taxes for special purposes must be approved by a two-thirds majority vote.  Proposition 218
also limits the authority of local governments to impose property-related assessments, fees and charges.  It requires that such
assessments be limited to the special benefit conferred and prohibits their use for general governmental services.  The Proposition
enables voters to use their initiative powers to reduce or repeal previously-authorized taxes, assessments, fees and charges.

         o    Effect of other State Laws on Bond Obligations.  Some of the tax-exempt securities that the Trust can invest in may be
obligations payable solely from the revenues of a specific institution or secured by specific properties.  These are subject to
provisions of California law that could adversely affect the holders of such obligations.  For example, the revenues of California
health care institutions may be adversely affected by State laws, and California law limits the remedies of a creditor secured by a
mortgage or deed of trust on real property.  Debt obligations payable solely from revenues of health care institutions may also be
insured by the State but no guarantee exists that adequate reserve funds will be appropriated by the State legislature for such
purpose.

         o        The Effect of General Economic Conditions in the State.  The California economy and general financial condition
affect the ability of the State and local government to raise and redistribute revenues to assist issuers of municipal securities to
make timely payments on their obligations.  California is the most populous state in the nation with a total population estimated at
34 million.  California has a diverse economy, with major employment in the agriculture, manufacturing, high technology, services,
trade, entertainment and construction sectors.  After experiencing strong growth throughout much of the 1980s, from 1990-1993 the
State suffered through a severe recession, the worst since the 1930's, heavily influenced by large cutbacks in defense/aerospace
industries, military base closures and a major drop in real estate construction.

         The recession reduced State revenues while its health and welfare costs were increasing. Consequently, the State had a
lengthy period of budget imbalance. During the recession, the State legislature eliminated significant components of its aid to local
governments. With the end of the recession, the State's financial condition has improved, with a combination of better than expected
revenues, slowdown in growth of social welfare programs, and continued spending restraint. The accumulated budget deficit from the
recession years has been eliminated and no deficit borrowing has occurred at the end of the last five fiscal years. The State has
also increased aid to local governments and reduced certain mandates for local services.

         However, U.S. economic growth has been slower than expected since the Spring 2001. Stock prices, especially in the
high-technology sector, are lower than was projected in January 2001. While the energy crisis has not yet directly affected the
national or California economy, rising wholesale energy costs are expected to have a ripple effect throughout the western United
States. Additionally, it is still unclear what the effect of the terrorist attacks in New York and Washington, D.C. on September 11,
2001 will have on the California and the U.S. economy.

         Certain of the State's significant industries, such as high technology, are sensitive to economic disruptions in their
export markets and the State's rate of economic growth, therefore, could be adversely affected by any such disruption.  A significant
downturn in U.S. stock market prices could adversely affect California's economy by reducing household spending and business
investment, particularly in the important high technology sector.  Moreover, a large and increasing share of thee State's General
Fund revenue in the form of income and capital gains taxes is directly related to, and would be adversely affected by a significant
downturn in the performance of, the stock markets.

         In addition, it is impossible to predict the time, magnitude or location of a major earthquake or its effect on the
California economy.  In January 1994, a major earthquake struck the Los Angeles area, causing significant damage in a four county
area.  The possibility exists that another such earthquake could create a major dislocation of the California economy and
significantly affect state and local government budgets.

         On July 26, 2001, the Governor signed the 2001 Budget Act enacting the State's fiscal year 2001-02 budget.  The spending
plan projects General Fund revenues of $75.1 billion, a drop of $2.9 billion from revised 2000-01 estimates.  The 2001 Budget Act
includes General Fund expenditures of $78.8 billion, a reduction of $1.3 billion from the prior year, which could be accomplished
without serious program cuts because such a large part of the 2000 Budget Act was comprised of one-time expenditures.  The 2001
Budget Act also includes Special Fund expenditures of $21.3 billion and Bond Fund expenditures of $3.2 billion.  The Governor held
back $500 million as a set aside for litigation costs and vetoed almost $500 million in General Fund expenditures from the Budget
passed by the legislature.

         The State anticipates issuing approximately $5.7 billion of revenue anticipation notes during the fiscal year as part of its
cash management program.  The Department of Finance estimated in the 2001 Budget Act that the June 30, 2001 Special Fund for Economic
Uncertainties ("SFEU") balance, the budget reserve, will be approximately $6.3 billion, although this reserve has been virtually
entirely used to provide advances to support the Department of Water Resources power purchase program.  The 2001 Budget Act uses more
than half of the budget surplus as of June 30, 2001, but has a projected balance in the SFEU at June 30, 2002 of $2.6 billion.  The
2001 Budget Act assumes the $6.1 billion advanced by the General Fund to the Department of Water Resources for power purchases will
be repaid with interest.

         During the early 1990's recession  the State experienced reductions in the overall credit ratings assigned to its General
Obligation bonds by several major rating agencies.  In July 1994, the ratings of those bonds were downgraded from Aa to A1 by
Moody's, from A+ to A by Standard & Poor's and from AA to A by Fitch, the international rating agency.  The State's improved economy
and budget, however, have resulted in several upgrades in its general obligation bond ratings, although the energy crisis among other
things has caused its rating to be downgraded in the first half of 2001.  As of September 26, 2001, the State's general obligation
bonds were rated Aa3 by Moody's, A+ by Standard & Poor's, and AA by Fitch.  It is not presently possible to determine whether, or the
extent to which, Moody's S&P or Fitch will change such ratings in the future.  It should be noted that the creditworthiness of
obligations issued by local California issuers may be unrelated to the creditworthiness of obligations issued by the State, and there
is no obligation on the part of the State to make payment on such local obligations in the event of default.

         o        Financial Problems of Local Governments.  It is not possible to predict the future impact of the voter initiatives.
State constitutional amendments, legislation or economic considerations described above, or of such initiatives, amendments or
legislation that may be enacted in the future, on the long-term ability of California municipal issuers to pay interest or repay
principal on their obligations.  There is no assurance that any California issuer will make full or timely payments of principal or
interest or remain solvent.  For example, in December 1994, Orange County, California, together with its pooled investment funds,
which included investment funds from other local governments, filed for bankruptcy.  The County has since emerged from bankruptcy.
Los Angeles County, the nation's largest county, in the recent past has also experienced financial difficulty and its financial
condition will continue to be affected by the large number of County residents who are dependent on government services and by a
structural deficit in its health department.  Moreover, California's improved economy has caused Los Angeles County, and other local
governments, to come under increased pressure from public employee unions for improved compensation and retirement benefits.






Investment Restrictions

         |X|  What Are "Fundamental Policies?"  Fundamental policies are those policies that the Trust has adopted to govern its
investments that can be changed only by the vote of a "majority" of the Trust's outstanding voting securities.  Under the Investment
Company Act, a "majority" vote is defined as the vote of the holders of the lesser of:

         |_|  67% or more of the shares present or represented by proxy at a shareholder meeting, if the holders of more than 50% of
         the outstanding shares are present or represented by proxy, or
         |_|  more than 50% of the outstanding shares.

         The Trust's investment objective is a fundamental policy. Other policies described in the Prospectus or this Statement of
Additional Information are "fundamental" only if they are identified as such.  The Trust's Board of Trustees can change
non-fundamental policies without shareholder approval.  However, significant changes to investment policies will be described in
supplements or updates to the Prospectus or this Statement of Additional Information, as appropriate. The Trust's most significant
investment policies are described in the Prospectus.

|X|      Does the Trust Have Additional Fundamental Policies?  The following investment restrictions are fundamental policies of the
Trust.

         |_|  The Trust cannot make loans, except that the Trust, may purchase debt securities described in "Investment Objective and
Policies," and other securities substantially similar thereto, and repurchase agreements; and the Trust may lend its portfolio
securities as described in its investment policy stated above;

         |_|  The Trust cannot borrow money in excess of 10% of the value of its total assets or make any investment when borrowings
exceed 5% of the value of its total assets; it may borrow only as a temporary measure for extraordinary or emergency purposes; no
assets of the Trust may be pledged, mortgaged or assigned to secure a debt;

         |_|  The Trust cannot invest in commodities or commodity contracts, or invest in interests in oil, gas, or other mineral
exploration or development programs;

         |_|  The Trust cannot invest in real estate; however, the Trust may purchase Municipal Bonds or Notes secured by interests in
real estate;

         |_|  The Trust cannot make short sales of securities or purchase securities on margin, except for short-term credits
necessary for the clearance of purchases and sales of portfolio securities;

         |_|  The Trust cannot invest in or hold securities of any issuer if those officers and Trustees of the Trust or the Manager
individually owning more than 0.5% of the securities of such issuer together own more than 5% of the securities of such issuer;

         |_|  The Trust cannot underwrite securities of other companies;

         |_|  The Trust cannot invest in securities of other investment companies except as they may be acquired as part of a merger,
consolidation or acquisition of assets; or

|_|      The Trust cannot issue "senior securities," but this does not prohibit certain investment activities for which assets of the
Trust are designated as segregated, or margin, collateral or escrow arrangements are established, to cover the related obligations.

|_|      As a fundamental policy, The Trust cannot invest in any debt instrument having a maturity in excess of the time period
provided for in Rule 2a-7 of the Investment Company Act of 1940, or any other applicable rule, or in the case of a debt instrument
subject to a repurchase agreement or called for redemption, unless purchased subject to a demand feature which may not exceed the
time period provided for in Rule 2a-7, or any other applicable rule.

|_|      The Trust cannot invest 25% or more of its total assets in any one industry; however, for the purposes of this restriction,
municipal securities and U.S. government obligations are not considered to be part of any single industry.

         For purposes of the investment restrictions listed above, the identification of the "issuer" of a municipal security depends
on the terms and conditions of the security.  When the assets and revenues of an agency, authority, instrumentality or other
political subdivision are separate from those of the government creating the subdivision and the security is backed only by the
assets and revenues of the subdivision, such subdivision would be deemed to be the sole issuer.  Similarly, in the case of an
industrial development bond, if that bond is backed only by the assets and revenues of the nongovernmental user, then such
nongovernmental user would be deemed to be the sole issuer.  However, if in either case the creating government or some other entity
guarantees the security, such guarantee would be considered a separate security and would be treated as an issue of such government
or other agency. Conduit securities are deemed to be issued by the person ultimately responsible for payments of interest and
principal on the security.

         In applying the restrictions as to the Trust's investments, the Manager will consider a nongovernmental user of facilities
financed by industrial development bonds as being in a particular industry, despite the fact that there is no industry concentration
limitation as to municipal securities the Trust may own.  Although this application of the restriction is not technically a
fundamental policy of the Trust, it will not be changed without shareholder approval. Should any such change be made, the Prospectus
and/or Statement of Additional Information will be supplemented to reflect the change.

         Unless the Prospectus or this Statement of Additional Information states that a percentage restriction applies on an ongoing
basis, it applies only at the time the Trust makes an investment. The Trust need not sell securities to meet the percentage limits if
the value of the investment increases in proportion to the size of the Trust.

         For purposes of the Trust's policy not to concentrate its investments in securities of issuers, the Trust has adopted the
industry classifications set forth in Appendix B to this Statement of Additional Information.  This is not a fundamental policy.


How the Trust is Managed


Organization and History.  The Trust is an open-end, diversified management investment company organized as a Massachusetts business
trust in 1989, with an unlimited number of authorized shares of beneficial interest.


         The Trust is governed by a Board of Trustees, which is responsible for protecting the interests of shareholders under
Massachusetts law.  The Trustees meet periodically throughout the year to oversee the Trust's activities, review its performance, and
review the actions of the Manager. Although the Trust will not normally hold annual meetings of its shareholders, it may hold
shareholder meetings from time to time on important matters.  Shareholders of the Trust may have the right to call a meeting to
remove a Trustee or to take other action described in the Declaration of Trust.


         The Board of Trustees has an Audit Committee and a Review Committee.  Effective June 25, the members of the Audit Committee
are Edward L. Cameron (Chairman), William L. Armstrong, George C. Bowen and Robert J. Malone.  The Audit Committee held six meetings
during the Trust's fiscal year ended June 30, 2001.  The Audit Committee provides the Board with recommendations regarding the
selection of the Trust's independent auditor.  The Audit Committee also reviews the scope and results of audits and the audit fees
charged, reviews reports from the Trust's independent audit concerning the Trust's internal accounting procedures and controls and
selects and nominates for approval by the Board the independent Trustees, among other duties as set forth in the Committee's charter.

         Effective June 25, the members of the Review Committee are Jon S. Fossel (Chairman), Robert G. Avis, Sam Freedman, Beverly
L. Hamilton, and F. William Marshall, Jr. The Review Committee held six meetings during the fiscal year ended June 30, 2001.  The
Review Committee reviews reports and makes recommendations to the Board concerning the fees paid to the Trust's Transfer Agent and
the services provided to the Trust by the Transfer Agent.  The Review Committee also reviews policies and procedures adopted by the
Trust to comply with the Investment Company Act of 1940 and other applicable law, among other duties as set forth in the Committee's
charter.


         |X|  Classes of Shares. The Trust has a single class of shares of stock.  While that class has no designation, it is deemed
to be the equivalent of Class A for purposes of the shareholder account policies that apply to Class A shares of the Oppenheimer
funds.  Shares of the Trust are freely transferable.  Each share has one vote at shareholder meetings, with fractional shares voting
proportionally on matters submitted to a vote of shareholders.  There are no preemptive or conversion rights and shares participate
equally in the assets of the Trust upon liquidation.

         |X|  Meetings of Shareholders.  As a Massachusetts business trust, the Trust is not required to hold, and does not plan to
hold, regular annual meetings of shareholders. The Trust will hold meetings when required to do so by the Investment Company Act or
other applicable law.  It will also do so when a shareholder meeting is called by the Trustees or upon proper request of the
shareholders.


         Shareholders have the right, upon the declaration in writing or vote of two-thirds of the outstanding shares of the Trust,
to remove a Trustee.  The Trustees will call a meeting of shareholders to vote on the removal of a Trustee upon the written request
of the record holders of 10% of the outstanding shares of the Trust.  If the Trustees receive a request from at least 10 shareholders
stating that they wish to communicate with other shareholders to request a meeting to remove a Trustee, the Trustees will then either
make the shareholder lists of the Trust available to the applicants or mail their communication to all other shareholders at the
applicants' expense.  The shareholders making the request must have been shareholders for at least six months and must hold shares of
the Trust valued at $25,000 or more or constituting at least 1% of the outstanding shares of the Trust, whichever is less.  The
Trustees may also take other action as permitted by the Investment Company Act.

              |_| Shareholder and Trustee Liability.  The Declaration of Trust contains an express disclaimer of shareholder or
Trustee liability for the Trust's obligations.  It also provides for indemnification and reimbursement of expenses out of the Trust's
property for any shareholder held personally liable for its obligations.  The Declaration of Trust also states that upon request, the
Trust shall assume the defense of any claim made against a shareholder for any act or obligation of the Trust and shall satisfy any
judgment on that claim.  Massachusetts law permits a shareholder of a business trust (such as the Trust) to be held personally liable
as a "partner" under certain circumstances.  However, the risk that a Trust shareholder will incur financial loss from being held
liable as a "partner" of the Trust is limited to the relatively remote circumstances in which the Trust would be unable to meet its
obligations.

         The Trust's contractual arrangements state that any person doing business with the Trust (and each shareholder of the Trust)
agrees under the Declaration of Trust to look solely to the assets of the Trust for satisfaction of any claim or demand that may
arise out of any dealings with the Trust. Additionally, the Trustees and shareholders shall have no personal liability to any such
person, to the extent permitted by law.


Trustees and Officers of the Trust.  The Trust's Trustees and officers and their principal occupations and business affiliations
during the past five years are listed below.  Trustees denoted with an asterisk (*) below are deemed to be "interested persons" of
the Trust under the Investment Company Act.  All of the Trustees are also trustees, directors or managing general partners of the
following Board II Oppenheimer funds1:

Oppenheimer Cash Reserves                               Oppenheimer Select Managers
Oppenheimer Champion Income Fund                        Oppenheimer Senior Floating Rate Fund
Oppenheimer Capital Income Fund                         Oppenheimer Strategic Income Fund
Oppenheimer High Yield Fund                             Oppenheimer Total Return Fund, Inc.
Oppenheimer International Bond Fund                     Oppenheimer Variable Account Funds
Oppenheimer Integrity Funds                             Panorama Series Fund, Inc.
Oppenheimer Limited-Term Government Fund                Centennial America Fund, L. P.
Oppenheimer Main Street(R)Funds, Inc.                    Centennial California Tax Exempt Trust
Oppenheimer Main Street(R)Opportunity Fund               Centennial Government Trust
Oppenheimer Main Street(R)Small Cap Fund                 Centennial Money Market Trust
Oppenheimer Municipal Fund                              Centennial New York Tax Exempt Trust
Oppenheimer Real Asset Fund(R)                          Centennial Tax Exempt Trust

         Messrs. Murphy, Molleur, Wixted, Carbuto and
Zack, and Mses. Feld, and Ives who are officers of
the Trust, respectively hold the same offices with
the other Board II Oppenheimer funds.  As of October
9, 2001, the Trustees and officers of the Trust as a
group owned less than 1% of the outstanding shares of
the Fund.  The foregoing statement does not reflect
shares held of record by an employee benefit plan for
employees of OppenheimerFunds, Inc. other than shares
beneficially owned under that plan by the officers of
the Fund listed below.  Mr. Murphy is the trustee of
that plan.

James C. Swain, Chairman,  Chief Executive Officer and
Trustee, Age: 68.
6803 South Tucson Way, Englewood, Colorado 80112
Formerly Vice Chairman of OppenheimerFunds, Inc.
(until January 2, 2002) and President and a director
of Centennial Asset Management Corporation (the
Fund's Distributor) (until 1997). Oversees 41
portfolios in the OppenheimerFunds complex.

John V. Murphy, President, Age: 52.
498 Seventh Avenue, New York, New York  10018
Director (since November 2001) of the Manager;
Chairman, Chief Executive Officer and director (since
June 2001) and President (since September 2000) of
OppenheimerFunds, Inc. ("OFI"); President and a
trustee of other Oppenheimer funds; President and a
director (since July 2001) of Oppenheimer Acquisition
Corp. and of Oppenheimer Partnership Holdings, Inc.;
a director (since November 2001) of OppenheimerFunds
Distributor, Inc.; Chairman and a director (since
July 2001) of Shareholder Services, Inc. and of
Shareholder Financial Services, Inc.; President and a
director (since July 2001) of OppenheimerFunds Legacy
Program, a charitable trust program established by
OFI; a director of the following investment advisory
subsidiaries of OFI: OAM Institutional, Inc. (since
November 2001), HarbourView Asset Management
Corporation and OFI Private Investments, Inc. (since
July 2002); President (since November 1, 2001) and a
director (since July 2001) of Oppenheimer Real Asset
Management, Inc.; a director (since November 2001) of
Trinity Investment Management Corp. and Tremont
Advisers, Inc., investment advisory affiliates of
OFI; Executive Vice President (since February 1997)
of Massachusetts Mutual Life Insurance Company, OFI's
parent company; a director (since June 1995) of DBL
Acquisition Corporation; formerly Chief Operating
Officer (from September 2000 to June 2001) of OFI;
President and trustee (from November 1999 to November
2001) of MML Series Investment Fund and MassMutual
Institutional Funds, open-end investment companies; a
director (from September 1999 to August 2000) of C.M.
Life Insurance Company; President, Chief Executive
Officer and director (from September 1999 to August
2000) of MML Bay State Life Insurance Company; a
director (from June 1989 to June 1998) of Emerald
Isle Bancorp and Hibernia Savings Bank, wholly-owned
subsidiary of Emerald Isle Bancorp. A
director/trustee of 63 other investment companies in
the OppenheimerFunds complex.

William L. Armstrong, Trustee, Age: 65.
6803 South Tucson Way, Englewood, Colorado 80112
Chairman of the following private mortgage banking
companies: Cherry Creek Mortgage Company (since
1991), Centennial State Mortgage Company (since
1994), The El Paso Mortgage Company (since 1993),
Transland Financial Services, Inc. (since 1997);
Chairman of the following private companies: Great
Frontier Insurance (insurance agency) (since 1995)
and Ambassador Media Corporation (since 1984); a
director of the following public companies: Storage
Technology Corporation (computer equipment company)
(since 1991), Helmerich & Payne, Inc. (oil and gas
drilling/production company) (since 1992),
UNUMProvident (insurance company) (since 1991).
Formerly Director of International Family
Entertainment (television channel) (1992 - 1997) and
Natec Resources, Inc. (air pollution control
equipment and services company) (1991-1995), Frontier
Real Estate, Inc. (residential real estate brokerage)
(1994-1999), and Frontier Title (title insurance
agency) (1995-June 1999); a U.S. Senator (January
1979-January 1991). Oversees 41 portfolios in the
OppenheimerFunds complex.

Robert G. Avis, Trustee, Age: 70.
6803 South Tucson Way, Englewood, Colorado 80112
Formerly,   (until   February   2001)   Director   and
President  of  A.G.  Edwards  Capital,  Inc.  (General
Formerly  Mr.  Avis  held  the  following   positions:
Director and President of A.G. Edwards  Capital,  Inc.
(General  Partner  of  private  equity  funds)  (until
February   2001);   Chairman,   President   and  Chief
Executive  Officer  of  A.G.  Edwards  Capital,   Inc.
(until  March  2000);  Vice  Chairman  and Director of
A.G.  Edwards,  Inc. and Vice Chairman of A.G. Edwards
&  Sons,  Inc.  (its  brokerage  company   subsidiary)
(until - March 1999);  Chairman of A.G.  Edwards Trust
Company  and  A.G.E.   Asset  Management   (investment
advisor) (until - March 1999);  and a Director of A.G.
Edwards & Sons and A.G.  Edwards Trust Company  (until
- -  March  2000).   Oversees  41   portfolios   in  the
OppenheimerFunds complex.

George C. Bowen, Trustee, Age: 65.
6803 South Tucson Way, Englewood, Colorado 80112
Formerly (until April 1999) Mr. Bowen held the
following positions: Senior Vice President (from
September 1987) and Treasurer (from March 1985) of
OppenheimerFunds, Inc.; Vice President (from June
1983) and Treasurer (since March 1985) of
OppenheimerFunds Distributor, Inc.; Senior Vice
President (since February 1992), Treasurer (since
July 1991) Assistant Secretary and a director (since
December 1991) of OppenheimerFunds, Inc.; Vice
President (since October 1989) and Treasurer (since
April 1986) of HarbourView Asset Management
Corporation an investment advisory subsidiary of
OppenheimerFunds, Inc.; President, Treasurer and a
director of Centennial Capital Corporation (June 1989
- - January 1990), an investment advisory subsidiary of
the Manager; Vice President and Treasurer (since
August 1978) and Secretary (since April 1981) of
Shareholder Services, Inc., a transfer agent
subsidiary of OppenheimerFunds, Inc.; Vice President,
Treasurer and Secretary of Shareholder Financial
Services, Inc. (since November 1989), a transfer
agent subsidiary of OppenheimerFunds, Inc.; Assistant
Treasurer of Oppenheimer Acquisition Corp. (since
March 1998), OppenheimerFunds, Inc.'s parent
corporation; Treasurer of Oppenheimer Partnership
Holdings, Inc. (since November 1989), a holding
company subsidiary of OppenheimerFunds, Inc.; Vice
President and Treasurer of Oppenheimer Real Asset
Management, Inc. (since July 1996), an investment
advisory subsidiary of OppenheimerFunds, Inc.; Chief
Executive Officer and director of MultiSource
Services, Inc., a broker-dealer subsidiary of
OppenheimerFunds, Inc. (since March 1996); Treasurer
of OppenheimerFunds International Ltd. and
Oppenheimer Millennium Funds plc (since October
1997), offshore fund management subsidiaries of
OppenheimerFunds, Inc.. Oversees 41 portfolios in the
OppenheimerFunds complex.








Edward L. Cameron, Trustee, Age: 63.
6803 South Tucson Way, Englewood, Colorado 80112
Director of Genetic ID, Inc. and its  subsidiaries,  a
privately  held biotech  company (since March 2001); a
member  of The  Life  Guard of  Mount  Vernon,  George
Washington's  home  (since  June  2000).   Formerly  a
partner    with    PricewaterhouseCoopers    LLP   (an
accounting firm) (from 1974-1999) and Chairman,  Price
Waterhouse LLP Global Investment  Management  Industry
Services   Group   (from   1994-1998).   Oversees   41
portfolios in the OppenheimerFunds complex.

Jon S. Fossel, Trustee, Age: 60.
6803 South Tucson Way, Englewood, Colorado 80112
Chairman and Director of Rocky Mountain Elk
Foundation, a not-for-profit foundation (since 1998);
and a director of P.R. Pharmaceuticals, a privately
held company (since October 1999) and UNUMProvident
(insurance company) (since June 1, 2002). Formerly
Mr. Fossel held the following positions: Chairman and
a director (until October 1996) and President and
Chief Executive Officer (until October 1995) of
OppenheimerFunds, Inc.; President, Chief Executive
Officer and a director of Oppenheimer Acquisition
Corp., Shareholder Services, Inc. and Shareholder
Financial   Services,   Inc.   (until  October  1995).
Oversees  41   portfolios   in  the   OppenheimerFunds
complex.

Sam Freedman, Trustee, Age: 61.
6803 South Tucson Way, Englewood, Colorado 80112
Formerly  (until  October 1994) Mr.  Freedman held the
following  positions:  Chairman  and  Chief  Executive
Officer  of  OppenheimerFunds  Services  (from  August
1980);   Chairman,   Chief  Executive  Officer  and  a
director of  Shareholder  Services,  Inc. (from August
1980); Chairman,  Chief Executive Officer and director
of   Shareholder   Financial   Services,   Inc.  (from
November   1989);   Vice  President  and  director  of
Oppenheimer  Acquisition Corp. (from October 1990) and
a  director  of  the  Manager  (from  October   1990).
Oversees  41   portfolios   in  the   OppenheimerFunds
complex.

Richard F. Grabish*, Trustee, Age: 53.
6803 South Tucson Way, Englewood, Colorado 80112
Senior Vice President, Assistant Director of Sales
and Marketing (since March 1997), and Manager of
Private Client Services (since June 1985) for A.G.
Edwards & Sons, Inc. (broker/dealer and investment
firm). Chairman and Chief Executive Officer of A.G.
Edwards Trust Company (since March 2001); Director of
A.G. Edwards & Sons, Inc. (since March 1988).
Formerly (until March 1987) President and Vice
Chairman of A.G. Edwards Trust Company. Oversees 6
portfolios in the OppenheimerFunds complex.

Beverly L. Hamilton, Trustee, Age 55.
6803 South Tucson Way, Englewood, Colorado 80112
Director  of  MML  Services,   an  investment  company
(since April 1987),  America  Funds  Emerging  Markets
Growth Fund,  an  investment  company  (since  October
1991),  The  California   Endowment,   a  philanthropy
organization   (since  April  2002),   and   Community
Hospital  of  Monterey   Peninsula,   (since  February
2002),  a Trustee of Monterey  International  Studies,
an educational  organization  (since  February  2000),
and an advisor to Unilever  (Holland)'s  pension  fund
and to Credit  Suisse First  Boston's  Sprout  venture
capital  unit.  Mrs.  Hamilton also is a member of the
investment  committees of the Rockefeller  Foundation,
the  University  of Michigan  and  Hartford  Hospital.
Formerly,  Mrs. Hamilton held the following  position:
President ARCO Investment  Management  Company,  (from
February   1991  until   April   2000).   Oversees  40
portfolios in the OppenheimerFunds complex.

Robert J. Malone, Trustee,  Age 57.
6803 South Tucson Way, Englewood, Colorado 80112
Director of Jones  Knowledge,  Inc., a privately  held
company  (since 2001),  director of U.S.  Exploration,
Inc.,  (since 1997),  director of Colorado  UpLIFT,  a
non-profit  organization (since 1986) and a Trustee of
the  Gallagher   Family   Foundation,   (since  2000).
Formerly,  Mr.  Malone held the  following  positions:
Chairman  of U.S.  Bank  (formerly  Colorado  National
Bank) a subsidiary of U.S.  Bancorp (from July 1, 1996
until April 1, 1999);  Chairman of the Board and Chief
Executive  Officer  of  Colorado  National  Bank (from
December  18,  1992 until July 1,  1996);  director of
Commercial Assets, Inc. (from 1993 to 2000).  Oversees
40 portfolios in the OppenheimerFunds complex.

F. William Marshall, Jr., Trustee, Age: 59.
6803 South Tucson Way, Englewood, Colorado 80112
Trustee (since 1996) of MassMutual Institutional
Funds and of MML Series Investment Fund (open-end
investment companies). Formerly Chairman of SIS &
Family Bank, F.S.B. (formerly SIS Bank) (January 1999
- - July 1999); President, Chief Executive Officer and
Director of SIS Bankcorp., Inc. and SIS Bank
(formerly Springfield Institution for Savings) (May
1993 - December 1998); Executive Vice President of
Peoples Heritage Financial Group, Inc. (January 1999
- - July 1999); Chairman and Chief Executive Office of
Bank of Ireland First Holdings, Inc. and First New
Hampshire Banks (June 1990 - May 1993). Oversees 41
portfolios in the OppenheimerFunds complex.


Michael  A.  Carbuto,  Vice  President  and  Portfolio
Manager, Age: 46.
6803 South Tucson Way, Englewood, Colorado 80112
Vice President (since May 1988) of OppenheimerFunds,
Inc.; an officer and portfolio manager of other
Oppenheimer funds; formerly Vice President of the
Distributor (May 1988 - September 1999).


Robert G. Zack,  Vice  President and  Secretary,  Age:
53.
498 Seventh Avenue, New York, New York 10018
Senior Vice President (since May 1985) and General
Counsel (since February 2002) of OppenheimerFunds,
Inc.; Assistant Secretary of Shareholder Services,
Inc. (since May 1985), Shareholder Financial
Services, Inc. (since November 1989);
OppenheimerFunds International Ltd. and Oppenheimer
Millennium Funds plc (since October 1997); an officer
of other Oppenheimer funds; formerly, Acting General
Counsel (November 2001-February 2002) and Associate
General Counsel (1984 - October 2001).


Brian W. Wixted, Treasurer, Age: 42.
6803 South Tucson Way, Englewood, Colorado 80112
Senior Vice President and Treasurer (since March
1999) of OppenheimerFunds, Inc.; Treasurer (since
March 1999) of HarbourView Asset Management
Corporation, Shareholder Services, Inc., Oppenheimer
Real Asset Management Corporation, Shareholder
Financial Services, Inc. and Oppenheimer Partnership
Holdings, Inc., of OFI Private Investments, Inc.
(since March 2000) and of OppenheimerFunds
International Ltd. and Oppenheimer Millennium Funds
plc (since May 2000); Treasurer and Chief Financial
Officer (since May 2000) of Oppenheimer Trust
Company; Assistant Treasurer (since March 1999) of
Oppenheimer Acquisition Corp. and of the Manager; an
officer of other Oppenheimer funds; formerly
Principal and Chief Operating Officer, Bankers Trust
Company - Mutual Fund Services Division (March 1995 -
March 1999); Vice President and Chief Financial
Officer of CS First Boston Investment Management
Corp. (September 1991 - March 1995).


Denis R. Molleur, Assistant Secretary, Age: 44.
498 Seventh Avenue, New York, New York 10018
Vice President and Senior Counsel of
OppenheimerFunds, Inc. (since July 1999); an officer
of other Oppenheimer funds; formerly a Vice President
and Associate Counsel of OppenheimerFunds, Inc.
(September 1991 - July 1999).

Katherine P. Feld, Assistant Secretary, Age: 43.
498 Seventh Avenue, New York, New York 10018
Vice President and Senior Counsel of
OppenheimerFunds, Inc (since July 1999); Vice
President of OppenheimerFunds Distributor, Inc.
(since June 1990); an officer of other Oppenheimer
funds; formerly a Vice President and Associate
Counsel of OppenheimerFunds, Inc. (June 1990 - July
1999).

Kathleen T. Ives, Assistant Secretary, Age: 36.
6803 South Tucson Way, Englewood, CO 80112
Vice    President    and    Assistant    Counsel    of
OppenheimerFunds,  Inc (since June  1998);  an officer
of other  Oppenheimer  funds;  formerly  an  Assistant
Vice    President    and    Assistant    Counsel    of
OppenheimerFunds,  Inc. (August 1997 - June 1998); and
Assistant  Counsel of  OppenheimerFunds,  Inc. (August
1994 - August 1997).

o     Remuneration of Trustees. The officers of the
Trust are affiliated with the Manager and receive no
salary or fee from the Trust. The remaining Trustees
of the Trust received the compensation shown below.
The compensation from the Trust was paid during its
fiscal year ended June 30, 2001.  Mr. Swain was
affiliated with the Manager until January 2, 2002.
The compensation from all of the Board II Oppenheimer
funds includes the Trust and is compensation received
as a director, trustee, managing general partner or
member of a committee of the Board during the
calendar year 2000.







                                              -------------------------- ------------------------------------------

                                                                                                                                                                               Total Compensation
                                                                                                                                                                                from all Board II
Trustee's Name                                                            Aggregate Compensation                                                                               Oppenheimer Funds2
and Other Positions                                                             from Trust1                                                                                        (41 Funds)

                                              -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------

   William L. Armstrong                                 $193                              $49,270
   Audit Committee Member

   ------------------------------------------ -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------
   Robert G. Avis                                       $226                              $72,000
   Review Committee Member
   ------------------------------------------ -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------

   George C. Bowen                                      $195                              $55,948
   Audit Committee Member

   ------------------------------------------ -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------
   Edward L. Cameron                                    $149                              $26,709
   Audit Committee Chairman
   ------------------------------------------ -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------
   Jon S. Fossel                                        $245                              $77,880
   Review Committee Chairman
                                              -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------
   Sam Freedman                                         $256                              $80,100
   Review Committee Member
                                              -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------
   Richard F. Grabish                                    $7                                 $0
                                              -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------

   Beverly Hamilton3                                    None                               None
   Review Committee Member

   ------------------------------------------ -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------

   C. Howard Kast4                                      $272                              $86,150

   ------------------------------------------ -------------------------- ------------------------------------------
                                              -------------------------- ------------------------------------------

   Robert M. Kirchner4                                  $246                              $76,950

   ------------------------------------------ -------------------------- ------------------------------------------
                                              -------------------------- ------------------------------------------

   Robert J. Malone3                                    None                               None
   Audit Committee Member

   ------------------------------------------ -------------------------- ------------------------------------------
   ------------------------------------------ -------------------------- ------------------------------------------

   F. William Marshall, Jr.                             $100                              $3,768
   Review Committee Member

   ------------------------------------------ -------------------------- ------------------------------------------

     * Effective July 1, 2000, William A. Baker and Ned M. Steel resigned as Trustees of the Trust and subsequently became Trustees
     Emeritus of the Trust. For the fiscal year ended June 30, 2001, Messrs. Baker and Steel each received $178 aggregate compensation
     from the Trust and for the calendar year ended December 31, 2000, they each received $63,999 total compensation from all Board II
     Oppenheimer funds.  Effective April 5, 2001, Raymond J. Kalinowski resigned as Trustee of the Trust.  For the fiscal year ended
     June 30, 2001, Mr. Kalinowski received $175 aggregate compensation from the Trust and for the calendar year ended December 31,
     2000, he received $73,500 total compensation from Board II Oppenheimer funds.

1.       For the Trust's fiscal year end June 30, 2001.
2.       For the 2000 calendar year.

3.       Mrs. Hamilton and Mr. Malone were elected as Directors/Trustees of the Board II Funds effective June 1, 2002 and therefore
         did not receive compensation from any of the Board II Funds during the Fund's fiscal year ended June 30, 2001or calendar
         year 2000.
4.       Effective July 1, 2002, Messrs. Kast and Kirchner retired as Directors/Trustees from the Board II funds.


         o    Deferred Compensation Plan for Trustees.  The Trustees have adopted a Deferred Compensation Plan for disinterested
Trustees that enables them to elect to defer receipt of all or a portion of the annual fees they are entitled to receive from the
Trust.  Under the plan, the compensation deferred by a Trustee is periodically adjusted as though an equivalent amount had been
invested in shares of one or more Oppenheimer funds selected by the Trustee.  The amount paid to the Trustee under this plan will be
determined based upon the performance of the selected funds.

         Deferral of fees of the Trustees under this plan will not materially affect the Trust's assets, liabilities or net income
per share.  This plan will not obligate the Trust to retain the services of any Trustee or to pay any particular level of
compensation to any Trustee.  Pursuant to an Order issued
by the Securities and Exchange Commission, the Trust may invest in the funds selected by any Trustee under this plan without
shareholder approval for the limited purpose of determining the value of the Trustees' deferred fee accounts.

         |X|  Major Shareholders.  As of October 9, 2001 the only person who owned of record or was known by the Trust to own
beneficially 5% or more of the Trust's outstanding retail shares was A.G. Edwards & Sons, Inc. ("Edwards"), 1 North Jefferson Avenue,
St. Louis, Missouri 63103, which owned 174,670,636.420 shares of the Trust which was 99.65% of the outstanding shares of the Trust on
that date, for accounts of its customers none of whom individually owned more than 5% of the outstanding shares.

The Manager.  The Manager, Centennial Asset Management Corporation, is wholly-owned by OppenheimerFunds, Inc., which is a
wholly-owned subsidiary of Oppenheimer Acquisition Corp., a holding company controlled by Massachusetts Mutual Life Insurance
Company.

         The portfolio manager of the Trust is principally responsible for the day-to-day management of the Trust's investment
portfolio.  Other members of the Manager's fixed-income portfolio department, particularly security analysts, traders and other
portfolio managers, have broad experience with fixed-income securities.  They provide the Trust's portfolio manager with research and
support in managing the Trust's investments.

         |X|  The Investment Advisory Agreement.  The Manager provides investment advisory and management services to the Trust under
an investment advisory agreement between the Manager and the Trust.  The Manager selects securities for the Trust's portfolio and
handles its day-to-day business.  The agreement requires the Manager, at its expense, to provide the Trust with adequate office
space, facilities and equipment.  It also requires the Manager to provide and supervise the activities of all administrative and
clerical personnel required to provide effective administration for the Trust.  Those responsibilities include the compilation and
maintenance of records with respect to its operations, the preparation and filing of specified reports, and composition of proxy
materials and registration statements for continuous public sale of shares of the Trust.

         Expenses not expressly assumed by the Manager under the investment advisory agreement are paid by the Trust.  The investment
advisory agreement lists examples of expenses paid by the Trust.  The major categories relate to interest, taxes, fees to
unaffiliated Trustees, legal and audit expenses, custodian and transfer agent expenses, share issuance costs, certain printing and
registration costs and non-recurring expenses, including litigation costs.  The management fees paid by the Trust to the Manager are
calculated at the rates described in the Prospectus.

- ------------------------- --------------------------------------------------------------------------------------------
Fiscal Year ending 6/30                 Management Fee Paid to Centennial Asset Management Corporation
- ------------------------- --------------------------------------------------------------------------------------------
- ------------------------- --------------------------------------------------------------------------------------------
          1999                                                     $841,379
- ------------------------- --------------------------------------------------------------------------------------------
- ------------------------- --------------------------------------------------------------------------------------------
          2000                                                     $802,750
- ------------------------- --------------------------------------------------------------------------------------------
- ------------------------- --------------------------------------------------------------------------------------------
          2001                                                     $832,185
- ------------------------- --------------------------------------------------------------------------------------------

         The Manager has undertaken that the total expenses of the Trust, in any fiscal year of the Trust, exclusive of taxes,
interest, brokerage commissions (if any) and non-recurring expenses, including litigation, shall not exceed 0.80% of the average
annual net assets of the Trust.  The payment of the management fee at the end of any month will be reduced so that there will not be
any accrued but unpaid liability under those expense limitations.  Any assumption of the Trust's expenses under this arrangement
lowers the Trust's overall expense ratio and increases its yield and total return during the time such expenses are assumed.  The
Manager reserves the right to vary the amount of expenses assumed or eliminate the assumption of expenses altogether. For the fiscal
years ended June 30, 1999, 2000, and 2001, the management fees payable by the Trust would have been $824,512, $802,750, and $776,093
with the Manager's voluntary expense assumption.  Those amounts reflect the effect of the expense assumptions of $16,867, $0 and
$39,225 for the fiscal years ended June 30, 1999, 2000 and 2001, respectively.  The expense assumption of $39,225 for the fiscal year
ended June 30, 2001 includes $16,035 that the Manager reimbursed the Trust for the fiscal year ended June 30, 2000.

      The  investment  advisory  agreement  states that in the  absence of willful  misfeasance,  bad faith,  gross  negligence  in the
performance of its duties or reckless disregard of its obligations and duties under the investment advisory  agreement,  the Manager is
not  liable for any loss  resulting  from a good  faith  error or  omission  on its part with  respect  to any of its duties  under the
agreement.

         |X|  The Distributor.  Under its General Distributor's agreement with the Trust, Centennial Asset Management Corporation acts
as the Trust's principal underwriter and Distributor in the continuous public offering of the Trust's shares.  The Distributor is not
obligated to sell a specific number of shares.  The Distributor bears the expenses normally attributable to sales, including
advertising and the cost of printing and mailing prospectuses, other than those furnished to existing shareholders. For other
distribution expenses paid by the Trust, see the section entitled "Service Plan" below. The Trust's Sub-Distributor is
OppenheimerFunds Distributor, Inc.

Portfolio Transactions.  Portfolio decisions are based upon recommendations and judgment of the Manager subject to the overall
authority of the Board of Trustees.  Most purchases made by the Trust are principal transactions at net prices, so the Trust incurs
little or no brokerage costs. The Trust deals directly with the selling or purchasing principal or market maker without incurring
charges for the services of a broker on its behalf unless the Manager determines that a better price or execution may be obtained by
using the services of a broker.  Purchases of portfolio securities from underwriters include a commission or concession paid by the
issuer to the underwriter, and purchases from dealers include a spread between the bid and asked prices.

         The Trust seeks to obtain prompt execution of orders at the most favorable net price.  If broker/dealers are used for
portfolio transactions, transactions may be directed to broker/dealers for their execution and research services.  The research
services provided by a particular broker may be useful only to one or more of the advisory accounts of the Manager and its
affiliates.  Investment research received for the commissions of those other accounts may be useful both to the Trust and one or more
of such other accounts.  Investment research services may be supplied to the Manager by a third party at the instance of a broker
through which trades are placed.  It may include information and analyses on particular companies and industries as well as market or
economic trends and portfolio strategy, receipt of market quotations for portfolio evaluations, information systems, computer
hardware and similar products and services.  If a research service also assists the Manager in a non-research capacity (such as
bookkeeping or other administrative functions), then only the percentage or component that provides assistance to the Manager in the
investment decision-making process may be paid in commission dollars.

         The research services provided by brokers broaden the scope and supplement the research activities of the Manager.  That
research provides additional views and comparisons for consideration, and helps the Manager obtain market information for the
valuation of securities held in the Trust's portfolio or being considered for purchase.

         Subject to applicable rules covering the Manager's activities in this area, sales of shares of the Trust and/or the other
investment companies managed by the Manager or distributed by the Distributor may also be considered as a factor in the direction of
transactions to dealers.  That must be done in conformity with the price, execution and other considerations and practices discussed
above.  Those other investment companies may also give similar consideration relating to the sale of the Trust's shares.  No
portfolio transactions will be handled by any securities dealer affiliated with the Manager.

         The Trust may experience high portfolio turnover that may increase the Trust's transaction costs.  However, since brokerage
commissions, if any, are small, high turnover does not have an appreciable adverse effect upon the income of the Trust.

Service Plan

The Trust has adopted a Service Plan for the shares.  The plan has been approved by a vote of the Board of Trustees, including a
majority of the Independent Trustees2, cast in person at a meeting called for the purpose of voting on that plan.

         Under the plan, the Manager and the Distributor may make payments to affiliates and, in their sole discretion, from time to
time, may use their own resources (at no direct cost to the Trust) to make payments to brokers, dealers or other financial
institutions for distribution and administrative services they perform.  The Manager may use its profits from the advisory fee it
receives from the Trust.  In their sole discretion, the Distributor and the Manager may increase or decrease the amount of payments
they make from their own resources to plan recipients.

         Unless a plan is terminated as described below, the plan continues in effect from year to year but only if the Trust's Board
of Trustees and its Independent Trustees specifically vote annually to approve its continuance.  Approval must be by a vote cast in
person at a meeting called for the purpose of voting on continuing the plan.  A plan may be terminated at any time by the vote of a
majority of the Independent Trustees or by the vote of the holders of a "majority" (as defined in the Investment Company Act) of the
outstanding shares of the Trust.

         The Board of Trustees and the Independent Trustees must approve all material amendments to a plan.  An amendment to increase
materially the amount of payments to be made under a plan must be approved by shareholders.  The approval must be by a "majority" (as
defined in the Investment Company Act) of the shares.

         While the plan is in effect, the Treasurer of the Trust shall provide separate written reports on the plan to the Board of
Trustees at least quarterly for its review.  The Reports shall detail the amount of all payments made under the plan and the purpose
for which the payments were made. Those reports are subject to the review and approval of the Independent Trustees.

         The plan states that while it is in effect, the selection and nomination of those Trustees of the Trust who are not
"interested persons" of the Trust is committed to the discretion of the Independent Trustees.  This does not prevent the involvement
of others in the selection and nomination process as long as the final decision as to selection or nomination is approved by a
majority of the Independent Trustees.

         Under the plan, no payment will be made to any recipient in any quarter in which the aggregate net asset value of all Trust
shares held by the recipient for itself and its customers does not exceed a minimum amount, if any, that may be set from time to time
by a majority of the Independent Trustees.  The Board of Trustees has set no minimum amount of assets to qualify for payments under
the plan.

         |X|  Service Plan Fees.  Under the service plan, the Distributor currently uses the fees it receives from the Trust to pay
brokers, dealers and other financial institutions (they are referred to as "recipients") for personal services and account
maintenance services they provide for their customers who hold shares.  The services include, among others, answering customer
inquiries about the Trust, assisting in establishing and maintaining accounts in the Trust, making the Trust's investment plans
available and providing other services at the request of the Trust or the Distributor. The service plan permits reimbursements to the
Distributor at a rate of up to 0.20% of average annual net assets of the shares.   The Distributor makes payments to plan recipients
quarterly at an annual rate not to exceed 0.20% of the average annual net assets consisting of shares held in the accounts of the
recipients or their customers.

         For the fiscal year ended June 30, 2001 payments under the plan totaled $327,340, all of which was paid by the Distributor
to recipients.  That included $16 paid to an affiliate of the Distributor's parent company. For the fiscal year ended June 30, 2001,
the Manager paid, in the aggregate, $496,898 in fees out of its own resources for distribution assistance. Any unreimbursed expenses
the Distributor incurs with respect to the shares in any fiscal quarter cannot be recovered in subsequent quarters.  The Distributor
may not use payments received under the plan to pay any of its interest expenses, carrying charges, or other financial costs, or
allocation of overhead.

Performance of the Trust

Explanation of Performance Terminology.  The Trust uses a variety of terms to illustrate its performance. These terms include
"yield," "compounded effective yield, " "tax-equivalent yield" and "average annual total return."  An explanation of how yields and
total returns are calculated is set forth below.  The charts below show the Trust's performance as of the Trust's most recent fiscal
year end.  You can obtain current performance information by calling the Trust's Transfer Agent at 1.800.525.9310.

         The Trust's illustrations of its performance data in advertisements must comply with rules of the Securities and Exchange
Commission.  Those rules describe the types of performance data that may be used and how it is to be calculated.  If the Trust shows
total returns in addition to its yields, the returns must be for the 1-, 5- and 10-year periods ending as of the most recent calendar
quarter prior to the publication of the advertisement (or its submission for publication).

         Use of standardized performance calculations enables an investor to compare the Trust's performance to the performance of
other funds for the same periods. However, a number of factors should be considered before using the Trust's performance information
as a basis for comparisons with other investments:

o        Yields and total returns measure the performance of a hypothetical account in the Trust over various periods and do not show
         the performance of each shareholder's account. Your account's performance will vary from the model performance data if your
         dividends are received in cash, or you buy or sell shares during the period, or you bought your shares at a different time
         than the shares used in the model.
o        An investment in the Trust is not insured by the FDIC or any other government agency.
o        The Trust's yield is not fixed or guaranteed and will fluctuate.
o        Yields and total returns for any given past period represent historical performance information and are not, and should not
         be considered, a prediction of future yields or returns.

           |_|  Yields.  The Trust's current yield is calculated for a seven-day period of time as follows. First, a base period
return is calculated for the seven-day period by determining the net change in the value of a hypothetical pre-existing account
having one share at the beginning of the seven-day period.  The change includes dividends declared on the original share and
dividends declared on any shares purchased with dividends on that share, but such dividends are adjusted to exclude any realized or
unrealized capital gains or losses affecting the dividends declared.  Next, the base period return is multiplied by 365/7 to obtain
the current yield to the nearest hundredth of one percent.

         The compounded effective yield for a seven-day period is calculated by
         (1) adding 1 to the base period return (obtained as described above),
         (2) raising the sum to a power equal to 365 divided by 7, and
         (3) subtracting 1 from the result.

         The yield as calculated above may vary for accounts less than approximately $100 in value due to the effect of rounding off
each daily dividend to the nearest full cent.  The calculation of yield under either procedure described above does not take into
consideration any realized or unrealized gains or losses on the Trust's portfolio securities which may affect dividends.  Therefore,
the return on dividends declared during a period may not be the same on an annualized basis as the yield for that period.

         The Trust's "tax equivalent yield" adjusts the Trust's current yield, as calculated above, by a stated federal tax rate.
The tax equivalent yield is computed by dividing the tax-exempt portion of the Trust's current yield by one minus a stated income tax
rate and adding the result to the portion (if any) of the Trust's current yield that is not tax-exempt.  The tax equivalent yield may
be compounded as described above to provide a compounded effective tax equivalent yield.

         For taxpayers with income above certain levels, otherwise allowable itemized deductions are limited. The Trust's tax
equivalent yield for the seven-day period ended June 30, 2001 was 3.41%.  Its tax-equivalent compounded effective yield for the same
period was 3.43% for an investor in the highest federal tax bracket.

         The tax-equivalent yield may be used to compare the tax effects of income derived from the Trust with income from taxable
investments at the tax rates stated. Your tax bracket is determined by your federal and state taxable income (the net amount subject
to federal and state income tax after deductions and exemptions).  The tax-equivalent yield table assumes that the investor is taxed
at the highest bracket, regardless of whether a switch to non-taxable investments would cause a lower bracket to apply.  For
taxpayers with income above certain levels, otherwise allowable itemized deductions are limited. The Trust's tax equivalent yield for
the highest tax bracket for the seven-day period ended June 30, 2001 was 3.41%.  Its tax-equivalent compounded effective yield for
the same period was 3.43% for an investor in the highest tax bracket.

         o    Total Return Information.  There are different types of "total returns" to measure the Trust's performance. Total return
is the change in value of a hypothetical investment in the Trust over a given period, assuming that all dividends and capital gains
distributions are reinvested in additional shares and that the investment is redeemed at the end of the period.  The cumulative total
return measures the change in value over the entire period (for example, ten years).  An average annual total return shows the
average rate of return for each year in a period that would produce the cumulative total return over the entire period.  However,
average annual total returns do not show actual year-by-year performance.  The Trust uses standardized calculations for its total
returns as prescribed by the SEC.  The methodology is discussed below.

              |_| Average Annual Total Return.  The "average annual total return" of each class is an average annual compounded rate
of return for each year in a specified number of years.  It is the rate of return based on the change in value of a hypothetical
initial investment of $1,000 ("P" in the formula below) held for a number of years ("n") to achieve an Ending Redeemable Value ("ERV"
in the formula) of that investment, according to the following formula:

                 1/n
            (ERV)
            (---)   -1 = Average Annual Total Return
            ( P )


|_|      Cumulative Total Return.  The "cumulative total return" calculation measures the change in value of a hypothetical
investment of $1,000 over an entire period of years.  Its calculation uses some of the same factors as average annual total return,
but it does not average the rate of return on an annual basis.  Cumulative total return is determined as follows:



            ERV - P
            ------- = Total Return
               P


- ------------------------- ---------------------- ---------------------------------------------------------------------
         Yield            Compounded Effective                Average Annual Total Returns (at 6/30/01)
 (7 days ended 6/30/00)           Yield
                              (7 days ended
                                6/30/01)
- ------------------------- ---------------------- ---------------------------------------------------------------------
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------

                                                         1-Year                 5 Years             Life of Trust
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------

         1.87%                    1.88%                  2.74%                   2.69%                  2.64%
- ------------------------- ---------------------- ----------------------- ---------------------- ----------------------

         |X|  Other Performance Comparisons.  Yield information may be useful to investors in reviewing the Trust's performance.  The
Trust may make comparisons between its yield and that of other investments, by citing various indices such as The Bank Rate Monitor
National Index (provided by Bank Rate Monitor(TM)) which measures the average rate paid on bank money market accounts, NOW accounts and
certificates of deposits by the 100 largest banks and thrifts in the top ten metro areas.  When comparing the Trust's yield with that
of other investments, investors should understand that certain other investment alternatives such as certificates of deposit, U.S.
government securities, money market instruments or bank accounts may provide fixed yields and may be insured or guaranteed.

         From time to time, the Trust may include in its advertisements and sales literature performance information about the Trust
cited in other newspapers and periodicals, such as The New York Times, which may include performance quotations from other sources.

            From time to time the Trust may include in its advertisements and sales literature the total return performance of a hypothetical
investment account that includes shares of the Trust and other Oppenheimer funds. The combined account may be part of an illustration
of an asset allocation model or similar presentation. The account performance may combine total return performance of the Trust and
the total return performance of other Oppenheimer funds included in the account. Additionally, from time to time, the Trust's
advertisements and sales literature may include, for illustrative or comparative purposes, statistical data or other information
about general or specific market and economic conditions. That may include, for example,
o        information about the performance of certain securities or commodities markets or segments of those markets,
o        information about the performance of the economies of particular countries or regions,
o        the earnings of companies included in segments of particular industries, sectors, securities markets, countries or regions,
o        the availability of different types of securities or offerings of securities,
o        information relating to the gross national or gross domestic product of the United States or other countries or regions,
o        comparisons of various market sectors or indices to demonstrate performance, risk, or other characteristics of the Trust.







A B O U T  Y O U R  A C C O U N T

How to Buy Shares

Determination of Net Asset Value Per Share. The net asset value per share of the Trust is determined twice each day that the New York
Stock Exchange ("Exchange") is open, at 12:00 Noon and at 4:00 P.M, on each day that the Exchange is open, by dividing the value of
the Trust's net assets by the total number of shares outstanding. All references to time in this Statement of Additional Information
mean New York time.  The Exchange's most recent annual announcement (which is subject to change) states that it will close on New
Year's Day, Martin Luther King Jr. Day, Washington's Birthday, Good Friday, Memorial Day, Independence Day, Labor Day, Thanksgiving
Day and Christmas Day.  It may also close on other days.

         The Trust's Board of Trustees has adopted the amortized cost method to value the Trust's portfolio securities.  Under the
amortized cost method, a security is valued initially at its cost and its valuation assumes a constant amortization of any premium or
accretion of any discount, regardless of the impact of fluctuating interest rates on the market value of the security.  This method
does not take into consideration any unrealized capital gains or losses on securities.  While this method provides certainty in
valuing securities, in certain periods the value of a security determined by amortized cost may be higher or lower than the price the
Trust would receive if it sold the security.

         The Trust's Board of Trustees has established procedures reasonably designed to stabilize the Trust's net asset value at
$1.00 per share.  Those procedures include a review of the valuations of the Trust's portfolio holdings by the Board of Trustees, at
intervals it deems appropriate, to determine whether the Trust's net asset value calculated by using available market quotations
deviates from $1.00 per share based on amortized cost.

         The Board of Trustees will examine the extent of any deviation between the Trust's net asset value based upon available
market quotations and amortized cost. If the Trust's net asset value were to deviate from $1.00 by more than 0.5%, Rule 2a-7 requires
the Board of Trustees to consider what action, if any, should be taken. If they find that the extent of the deviation may cause a
material dilution or other unfair effects on shareholders, the Board of Trustees will take whatever steps it considers appropriate to
eliminate or reduce the dilution, including, among others, withholding or reducing dividends, paying dividends from capital or
capital gains, selling portfolio instruments prior to maturity to realize capital gains or losses or to shorten the average maturity
of the portfolio, or calculating net asset value per share by using available market quotations.

         During periods of declining interest rates, the daily yield on shares of the Trust may tend to be lower (and net investment
income and dividends higher) than those of a fund holding the identical investments as the Trust but which used a method of portfolio
valuation based on market prices or estimates of market prices. During periods of rising interest rates, the daily yield of the Trust
would tend to be higher and its aggregate value lower than that of an identical portfolio using market price valuation.


How to Sell Shares

The information below supplements the terms and conditions for redeeming shares set forth in the Prospectus.

Checkwriting.  When a check is presented to the Bank for clearance, the Bank will ask the Trust to redeem a sufficient number of full
and fractional shares in the shareholder's account to cover the amount of the check.  This enables the shareholder to continue
receiving dividends on those shares until the check is presented to the Trust.  Checks may not be presented for payment at the
offices of the Bank or the Trust's Custodian.  This limitation does not affect the use of checks for the payment of bills or to
obtain cash at other banks.  The Trust reserves the right to amend, suspend or discontinue offering checkwriting privileges at any
time without prior notice.

         In choosing to take advantage of the Checkwriting privilege, by signing the Account Application or by completing a
Checkwriting card, each individual who signs:
(1)      for individual accounts, represents that they are the registered owner(s) of the shares of the Trust in that account;
(2)      for accounts for corporations, partnerships, trusts and other entities, represents that they are an officer, general
              partner, trustee or other fiduciary or agent, as applicable, duly authorized to act on behalf of the registered
              owner(s);
(3)      authorizes the Trust, its Transfer Agent and any bank through which the Trust's drafts (checks) are payable to pay all
              checks drawn on the Trust account of such person(s) and to redeem a sufficient amount of shares from that account to
              cover payment of each check;
         (4)  specifically acknowledges that if they choose to permit checks to be honored if there is a single signature on checks
              drawn against joint accounts, or accounts for corporations, partnerships, trusts or other entities, the signature of any
              one signatory on a check will be sufficient to authorize payment of that check and redemption from the account, even if
              that account is registered in the names of more than one person or more than one authorized signature appears on the
              Checkwriting card or the Application, as applicable;
(5)      understands that the Checkwriting privilege may be terminated or amended at any time by the Trust and/or the Trust's bank;
              and
(6)      acknowledges and agrees that neither the Trust nor its bank shall incur any liability for that amendment or termination of
              checkwriting privileges or for redeeming shares to pay checks reasonably believed by them to be genuine, or for
              returning or not paying checks that have not been accepted for any reason.

Sending Redemption Proceeds by Federal Funds Wire.  The Federal Funds wire of redemptions proceeds may be delayed if the Trust's
custodian bank is not open for business on a day when the Trust would normally authorize the wire to be made, which is usually the
Trust's next regular business day following the redemption.  In those circumstances, the wire will not be transmitted until the next
bank business day on which the Trust is open for business.  No distributions will be paid on the proceeds of redeemed shares awaiting
transfer by Federal Funds wire


How to Exchange Shares
As stated in the Prospectus, direct shareholders can exchange shares of the Trust for Class A shares of any of the following eligible
funds:


Oppenheimer Bond Fund                                         Oppenheimer Municipal Bond Fund
Oppenheimer California Municipal Fund                         Oppenheimer New York Municipal Fund
Oppenheimer Capital Appreciation Fund                         Oppenheimer New Jersey Municipal Fund
Oppenheimer Capital Preservation Fund                         Oppenheimer Pennsylvania Municipal Fund
Oppenheimer Capital Income Fund                               Oppenheimer Quest Balanced Value Fund
Oppenheimer Champion Income Fund                              Oppenheimer Quest Capital Value Fund, Inc.
Oppenheimer Concentrated Growth Fund                          Oppenheimer Quest Global Value Fund, Inc.
Oppenheimer Convertible Securities Fund                       Oppenheimer Quest Opportunity Value Fund
Oppenheimer Developing Markets Fund                           Oppenheimer Quest Value Fund, Inc.
Oppenheimer Disciplined Allocation Fund                       Oppenheimer Real Asset Fund(R)
Oppenheimer Discovery Fund                                    Oppenheimer Real Estate Fund
Oppenheimer Emerging Growth Fund                              Oppenheimer Rochester National Municipals Fund
Oppenheimer Emerging Technologies Fund                        Oppenheimer Senior Floating Rate Fund
Oppenheimer Enterprise Fund                                   Oppenheimer Small Cap Value Fund
Oppenheimer Europe Fund                                       Oppenheimer Special Value Fund
Oppenheimer Global Fund                                       Oppenheimer Strategic Income Fund
Oppenheimer Global Growth & Income Fund                       Oppenheimer Total Return Fund, Inc.
Oppenheimer Gold & Special Minerals Fund                      Oppenheimer Trinity Core Fund
Oppenheimer Growth Fund                                       Oppenheimer Trinity Large Cap Growth Fund
Oppenheimer High Yield Fund                                   Oppenheimer Trinity Value Fund
Oppenheimer Intermediate Municipal Fund                       Oppenheimer U.S. Government Trust
Oppenheimer International Bond Fund                           Oppenheimer Value Fund
Oppenheimer International Growth Fund                         Limited-Term New York Municipal Fund
Oppenheimer International Small Company Fund                  Rochester Fund Municipals
Oppenheimer Limited-Term Government Fund                      OSM1- Gartmore Millennium Growth Fund II
Oppenheimer Main Street(R)Growth & Income Fund                 OSM1 - Jennison Growth Fund
Oppenheimer Main Street(R)Opportunity Fund                     OSM1 - Mercury Advisors S&P 500 Index
Oppenheimer Main Street(R)Small Cap Fund                       OSM1 - Mercury Advisors Focus Growth Fund
Oppenheimer MidCap Fund                                       OSM1 - QM Active Balanced Fund
Oppenheimer Multiple Strategies Fund                          OSM1 - Salomon Brothers All Cap Fund
and the following money market funds:


Centennial America Fund, L. P.                                Centennial New York Tax Exempt Trust
Centennial California Tax Exempt Trust                        Centennial Tax Exempt Trust
Centennial Government Trust                                   Oppenheimer Cash Reserves
Centennial Money Market Trust                                 Oppenheimer Money Market Fund, Inc.

1 - "OSM" stands for Oppenheimer Select Managers

         Shares of the Trust purchased without a sales charge may be exchanged for shares of an eligible fund offered with a sales
charge upon payment of the sales charge.  Shares of the Trust acquired by reinvestment of dividends or distributions from the Trust
or any of the other eligible funds (other than Oppenheimer Cash Reserves) or from any unit investment trust for which reinvestment
arrangements have been made with the Distributor may be exchanged at net asset value for shares of any of the eligible funds.

         |_|  Limits on Multiple Exchange Orders.  The Trust reserves the right to reject telephone or written exchange requests
submitted in bulk by anyone on behalf of more than one account. The Trust may accept requests for exchanges of up to 50 accounts per
day from representatives of authorized dealers that qualify for this privilege.

         |_|  Telephone Exchange Requests.  When exchanging shares by telephone, a direct shareholder must have an existing account in
the fund to which the exchange is to be made.  Otherwise, the investor must obtain a prospectus of that fund before the exchange
request may be submitted. If all telephone lines are busy (which might occur, for example, during periods of substantial market
fluctuations), shareholders might not be able to request exchanges by telephone and would have to submit written exchange requests.

         |_|  Processing Exchange Requests.  Shares to be exchanged are redeemed on the regular business day the Transfer Agent
receives an exchange request in proper form (the "Redemption Date").  Normally, shares of the fund to be acquired are purchased on
the Redemption Date, but such purchases may be delayed by either fund up to five business days if it determines that it would be
disadvantaged by an immediate transfer of the redemption proceeds.  The Trust reserves the right, in its discretion, to refuse any
exchange request that may disadvantage it (for example, if the receipt of multiple exchange requests from a dealer might require the
disposition of portfolio securities at a time or at a price that might be disadvantageous to the Trust).

         In connection with any exchange request, the number of shares exchanged may be less than the number requested if the
exchange or the number requested would include shares subject to a restriction cited in the Prospectus or this Statement of
Additional Information or would include shares covered by a share certificate that is not tendered with the request.  In those cases,
only the shares available for exchange without restriction will be exchanged.

         The different eligible funds available for exchange have different investment objectives, policies and risks.  A shareholder
should assure that the fund selected is appropriate for his or her investment and should be aware of the tax consequences of an
exchange.  For federal income tax purposes, an exchange transaction is treated as a redemption of shares of one fund and a purchase
of shares of another.  The Trust, the Distributor, the Sub-Distributor, and the Transfer Agent are unable to provide investment, tax
or legal advice to a shareholder in connection with an exchange request or any other investment transaction.

         The Trust may amend, suspend or terminate the exchange privilege at any time.  Although, the Trust may impose these changes
at any time, it will provide you with notice of those changes whenever it is required to do so by applicable law.  It may be required
to provide 60 days notice prior to materially amending or terminating the exchange privilege.  That 60-day notice is not required in
extraordinary circumstances.






Dividends and Taxes

Tax Status of the Trust's Dividends and Distributions. The Trust intends to qualify under the Internal Revenue Code during each
fiscal year to pay "exempt-interest dividends" to its shareholders. Exempt-interest dividends that are derived from net investment
income earned by the Trust on municipal securities will be excludable from gross income of shareholders for federal income tax
purposes.  The Trust will only be eligible to pay exempt-interest dividends if at the end of each calendar quarter at least 50
percent of the value of the Trust's total assets consists of such municipal securities.

         Net investment income includes the allocation of amounts of income from the municipal securities in the Trust's portfolio
that are free from federal income taxes.  This allocation will be made by the use of one designated percentage applied uniformly to
all income dividends paid during the Trust's tax year.  That designation will normally be made following the end of each fiscal year
as to income dividends paid in the prior year.  The percentage of income designated as tax-exempt may substantially differ from the
percentage of the Trust's income that was tax-exempt for a given period.

         A portion of the exempt-interest dividends paid by the Trust may be an item of tax preference for shareholders subject to
the alternative minimum tax.  The amount of any dividends attributable to tax preference items for purposes of the alternative
minimum tax will be identified when tax information is distributed by the Trust.

         A shareholder receiving a dividend from income earned by the Trust from one or more of the following sources treats the
dividend as a receipt of either ordinary income or long-term capital gain in the computation of gross income, regardless of whether
the dividend is reinvested:
(1)      certain taxable temporary investments (such as certificates of deposit, repurchase agreements, commercial paper and
              obligations of the U.S. government, its agencies and instrumentalities);
(2)      income from securities loans;
(3)      income or gains from options or futures; or
(4)      an excess of net short-term capital gain over net long-term capital loss from the Trust.

         The Trust's dividends will not be eligible for the dividends-received deduction for corporations.  Shareholders receiving
Social Security benefits should be aware that exempt-interest dividends are a factor in determining whether such benefits are subject
to federal income tax.  Losses realized by shareholders on the redemption of Trust shares within six months of purchase (which period
may be shortened by regulation) will be disallowed for federal income tax purposes to the extent of exempt-interest dividends
received on such shares.

         If the Trust qualifies as a "regulated investment company" under the Internal Revenue Code, it will not be liable for
federal income taxes on amounts paid by it as dividends and distributions. That qualification enables the Trust to "pass through" its
income and realized capital gains to shareholders without having to pay tax on them. The Trust qualified as a regulated investment
company in its last fiscal year and intends to qualify in future years, but reserves the right not to qualify.  The Internal Revenue
Code contains a number of complex tests to determine whether the Trust qualifies. The Trust might not meet those tests in a
particular year. If it does not qualify, the Trust will be treated for tax purposes as an ordinary corporation and will receive no
tax deduction for payments of dividends and distributions made to shareholders.

         In any year in which the Trust qualifies as a regulated investment company under the Internal Revenue Code, the Trust will
also be exempt from California corporate income and franchise taxes. It will also be qualified under California law to pay exempt
interest dividends that will be exempt from California personal income tax. That exemption applies to the extent that the Trust's
distributions are attributable to interest on California municipal securities and qualifying obligations of the United States
government, if at least 50% of the Trust's assets are invested in such obligations at the close of each quarter in its tax year.
Distributions from the Trust attributable to income from sources other than California municipal securities and U.S. government
obligations will generally be subject to California income tax as ordinary income.

         Distributions by the Trust from investment income and long- and short-term capital gains will generally not be excludable
from taxable income in determining California corporate franchise tax or income tax for corporate shareholders of the Trust.
Additionally, certain distributions paid to corporate shareholders of the Trust may be includable in income subject to the California
alternative minimum tax.

         Under the Internal Revenue Code, by December 31 each year the Trust must distribute 98% of its taxable investment income
earned from January 1 through December 31 of that year and 98% of its capital gains realized in the period from November 1 of the
prior year through October 31 of the current year. If it does not, the Trust must pay an excise tax on the amounts not distributed.
It is presently anticipated that the Trust will meet those requirements. However, the Trust's Board of Trustees and the Manager might
determine in a particular year that it would be in the best interest of shareholders not to make distributions at the required levels
and to pay the excise tax on the undistributed amounts.  That would reduce the amount of income or capital gains available for
distribution to shareholders.

Dividend Reinvestment in Another Trust.  Direct shareholders of the Trust may elect to reinvest all dividends and/or capital gains
distributions in Class A shares of any eligible fund listed above. To elect this option, the shareholder must notify the Transfer
Agent in writing and must have an existing account in the fund selected for reinvestment.  Otherwise, the shareholder first must
obtain a prospectus for that fund and an application from the Distributor to establish an account.  The investment will be made at
the close of business on the payable date of the dividend or distribution.






Additional Information About the Trust

The Distributor.  The Trust's shares are sold through dealers, brokers and other financial institutions that have a sales agreement
with the Sub-Distributor.  The Distributor and the Sub-Distributor also distribute shares of the other funds managed by the Manager
or an affiliate.

The Transfer Agent.  Shareholder Services, Inc. the Trust's Transfer Agent, is responsible for maintaining the Trust's shareholder
registry and shareholder accounting records, and for paying dividends and distributions to shareholders of the Trust.  It also
handles shareholder servicing and administrative functions.

The Custodian.  Citibank, N.A. is the Custodian of the Trust's assets.  The Custodian's responsibilities include safeguarding and
controlling the Trust's portfolio securities and handling the delivery of such securities to and from the Trust.  It will be the
practice of the Trust to deal with the Custodian in a manner uninfluenced by any banking relationship the Custodian may have with the
Manager and its affiliates.  The Trust's cash balances with the Custodian in excess of $100,000 are not protected by federal deposit
insurance.  Those uninsured balances at times may be substantial.

Independent Auditors.  Deloitte & Touche LLP are the independent auditors of the Trust.  They audit the Trust's financial statements
and perform other related audit services.  They also act as auditors for the Manager and OFI and for certain other funds advised by
the Manager and its affiliates.

Independent Auditors' Report

Centennial California Tax Exempt Trust


To the Shareholders and Board of Trustees of Centennial California Tax Exempt
Trust

We have audited the accompanying statement of assets and liabilities of Centen-
nial California Tax Exempt Trust, including the statement of investments, as of
June 30, 2001, and 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 pe-
riod 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 au-
dits.

We conducted our audits in accordance with auditing standards generally ac-
cepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the finan-
cial 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, 2001, by correspondence with the 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 Cen-
tennial California Tax Exempt Trust as of June 30, 2001, the results of its op-
erations for the year then ended, the changes in its 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, in conformity with accounting princi-
ples generally accepted in the United States of America.

Deloitte & Touche LLP

Denver, Colorado
July 23, 2001

12 Statement of Investments June 30, 2001 Centennial California Tax Exempt Trust

                                                          Principal    Value
                                                            Amount   See Note 1
                                                          ---------- ----------

Short-Term Tax Exempt Obligations--100.4%
California--100.4%
 CA Dept. of Water Resource Revenue Trust Receipts,
  3.10%(/1/)............................................. $7,500,000 $7,500,000
 CA HF FAU RB, Series 152, FSA Insured, 2.40%(/1/).......  4,500,000  4,500,000
 CA M-S-R PPA RB, San Juan Project, Sub. Lien, Series B,
  AMBAC Insured, 2.40%(/1/)..............................  2,800,000  2,800,000
 CA M-S-R PPA RRB, San Juan Project, Sub. Lien, Series E,
  MBIA Insured, 2.40%(/1/)...............................  3,600,000  3,600,000
 CA Municipal Securities Trust Receipts, Series JPMC3,
  MBIA Insured, 3.15%(/1/)...............................  7,500,000  7,500,000
 CA PCFAU RB, Chevron USA, Inc. Project, 3%,
  5/15/02(/2/)...........................................  4,300,000  4,300,000
 CA PCFAU SWD RR RB, Shell Martinez Refining, Series A,
  3%(/1/)................................................  1,400,000  1,400,000
 CA SCDAU MH RB, Greentree Sr. Apts. Project, Series P,
  2.60%(/1/).............................................  7,350,000  7,350,000
 CA Statewide CDC IDV RB, Propak California Corp., Series
  B, 2.60%(/1/)..........................................    530,000    530,000
 CA Statewide CDC RB, Fibrebond, Inc., 2.60%(/1/)........  1,175,000  1,175,000
 Los Angeles Cnty., CA Pension Obligation RB, Series B,
  AMBAC Insured, 2.50%(/1/)..............................  2,000,000  2,000,000
 Los Angeles, CA Power & Waterworks RRB, Subseries B-1,
  2.55%(/1/).............................................  3,600,000  3,600,000
 Los Angeles, CA USD ABN AMRO Munitops Certificates,
  Trust 1999-7, MBIA Insured, 2.60%(/1/)(/3/)............  5,000,000  5,000,000
 Los Angeles, CA Wastewater System ABN AMRO Munitops
  Certificates, Trust 1998-25, FGIC Insured, 2.60%(/1/)..  2,000,000  2,000,000
 Los Angeles, CA Water & Power Revenue Municipal Trust
  Certificates-ZTC-17, Cl. A, FSA Insured,
  2.48%(/1/)(/3/)........................................  3,900,000  3,900,000
 Oakland & Alameda Cntys., CA Coliseum Authority Lease
  RRB, Coliseum Project, Series C-1, 2.75%(/1/)..........  6,400,000  6,400,000
 Orange Cnty., CA Apartment Development RRB, Villas
  Aliento, Series E, 2.45%(/1/)..........................  6,500,000  6,500,000
 Orange Cnty., CA Apartment Development RRB, Villas La
  Paz, Series F, 2.45%(/1/)..............................  1,000,000  1,000,000
 Orange Cnty., CA FAU Teeter Plan RB, Series B, AMBAC
  Insured, 2.50%(/1/)....................................  1,600,000  1,600,000
 Orange Cnty., CA FAU Teeter Plan RB, Series C, AMBAC
  Insured, 2.50%(/1/)....................................  5,100,000  5,100,000
 Orange Cnty., CA IDAU RB, Control Air Conditioning
  Project-A, 2.60%(/1/)..................................  1,300,000  1,300,000
 Rancho Mirage, CA Joint Powers FA COP, Eisenhower
  Medical Center, Series B, MBIA Insured, 2.40%(/1/).....  4,500,000  4,500,000
 Sacramento Cnty., CA HAU MH RB, Shadowood Apts. Project,
  Issue A, 2.70%(/1/)....................................  8,000,000  8,000,000
 Sacramento, CA FAU RB, Prerefunded, 6.70%,
  11/1/01(/2/)...........................................    955,000    982,854
 San Bernardino Cnty., CA, MH RB, Somerset Apts., Series
  A, 2.45%(/1/)..........................................  2,495,000  2,495,000
 San Diego Cnty., CA Teeter Obligation Bonds, 2.80%,
  8/14/01................................................  7,800,000  7,800,000
 San Diego Cnty., CA Unified Port District RB, Lindberg
  Field, 3.10%, 8/20/01..................................  6,709,000  6,709,000
 San Diego, CA Water Utility Fund Net System ABN AMRO
  Munitops Certificates, Trust 1998-10, FGIC Insured,
  2.60%(/1/)(/3/)........................................  7,000,000  7,000,000

4 Statement of Investments June 30, 2001 (Continued) Centennial California Tax Exempt Trust

                                                      Principal      Value
                                                       Amount      See Note 1
                                                     -----------  ------------

Short-Term Tax Exempt Obligations (Continued)
California (Continued)
 San Francisco, CA Airport Commission RB, San
  Francisco International Airport, 2.55%, 7/16/01... $ 3,000,000  $  3,000,000
 San Francisco, CA Airport Commission RB, San
  Francisco International Airport, 2.60%, 8/24/01...  12,350,095    12,350,095
 Southeast RR FA, CA Lease RRB, Series A,
  2.60%(/1/)........................................   4,000,000     4,000,000
 Southern CA Metropolitan Water District RB, Series
  B, 2.45%(/1/).....................................   7,500,000     7,500,000
 Southern CA PAU RRB, Palo Verde Project, Series B,
  AMBAC Insured, 2.50%(/1/).........................   3,500,000     3,500,000
 University of CA Board of Regents RB, 2.60%,
  7/11/01...........................................  11,000,000    11,000,000
                                                                  ------------
Total Investments, at Value (Cost $157,891,949).....       100.4%  157,891,949
                                                                  ------------
Liabilities in Excess of Other Assets...............        (0.4)     (575,588)
                                                     -----------  ------------
Net Assets..........................................       100.0% $157,316,361
                                                     ===========  ============

To simplify the listings of securities, abbreviations are used per the table below: CDC--Community Development Corp. PAU--Power Authority COP--Certificates of Participation PCFAU--Pollution Control Finance FA--Facilities Authority Authority FAU--Finance Authority PPA--Public Power Agency HAU--Housing Authority RB--Revenue Bonds HF--Health Facilities RR--Resource Recovery IDV--Industrial Development RRB--Revenue Refunding Bonds IDAU--Industrial Development SCDAU--Statewide Communities Authority Development Authority MH--Multifamily Housing SWD--Solid Waste Disposal USD--Unified School District

1. Floating or variable rate obligation maturing in more than one year. The interest rate, which is based on specific, or an index of, market interest rates, is subject to change periodically and is the effective rate on June 30, 2001. This instrument may also have a demand feature which allows, on up to 30 days’ notice, the recovery of principal at any time, or at specified intervals not exceeding one year.

2. Put obligation redeemable at full face value on the date reported.

3. Represents securities sold under Rule 144A, which are exempt from registration under the Securities Act of 1933, as amended. These securities have been determined to be liquid under guidelines established by the Board of Trustees. These securities amount to $15,900,000 or 10.11% of the Trust’s net assets as of June 30, 2001.

See accompanying Notes to Financial Statements. 5 Statement of Assets and Liabilities June 30, 2001 Centennial California Tax Exempt Trust

ASSETS
Investments, at value (Cost $157,891,949)--see accompanying
 statement......................................................  $157,891,949
Cash............................................................        16,360
Receivables and other assets:
 Shares of beneficial interest sold.............................       736,503
 Interest.......................................................       467,233
 Other..........................................................        18,273
                                                                  ------------
  Total assets..................................................   159,130,318
                                                                  ------------
LIABILITIES
Payables and other liabilities:
 Shares of beneficial interest redeemed.........................     1,593,769
 Service plan fees..............................................        86,905
 Dividends......................................................        78,801
 Shareholder reports............................................        27,342
 Other..........................................................        27,140
                                                                  ------------
  Total liabilities.............................................     1,813,957
                                                                  ------------
NET ASSETS......................................................  $157,316,361
                                                                  ============
COMPOSITION OF NET ASSETS
Paid-in capital.................................................  $157,320,269
Accumulated net realized gain (loss) on investment
 transactions...................................................        (3,908)
                                                                  ------------
NET ASSETS--applicable to 157,320,269 shares of beneficial
 interest outstanding...........................................  $157,316,361
                                                                  ============
NET ASSET VALUE, REDEMPTION PRICE AND OFFERING PRICE PER SHARE..         $1.00
                                                                         =====

See accompanying Notes to Financial Statements. 6 Statement of Operations For the Year Ended June 30, 2001 Centennial California Tax Exempt Trust

INVESTMENT INCOME
Interest............................................................ $5,860,637
                                                                     ----------
EXPENSES
Management fees.....................................................    832,185
Service plan fees...................................................    327,340
Registration and filing fees........................................     58,854
Transfer and shareholder servicing agent fees.......................     42,668
Custodian fees and expenses.........................................     41,761
Shareholder reports.................................................     24,903
Legal, auditing and other professional fees.........................     13,520
Trustees' compensation..............................................      2,422
Other...............................................................     47,994
                                                                     ----------
  Total expenses....................................................  1,391,647
   Less reduction to custodian expenses.............................    (23,042)
   Less reduction to excess expenses................................    (39,225)
                                                                     ----------
  Net expenses......................................................  1,329,380
                                                                     ----------
NET INVESTMENT INCOME...............................................  4,531,257
                                                                     ----------
NET REALIZED GAIN (LOSS) ON INVESTMENTS.............................     38,725
                                                                     ----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS................ $4,569,982
                                                                     ==========

See accompanying Notes to Financial Statements. 7 Statements of Changes in Net Assets Centennial California Tax Exempt Trust

                                                      Year Ended June 30,
                                                       2001          2000
                                                   ------------  ------------

OPERATIONS
Net investment income (loss)...................... $  4,531,257  $  4,121,252
Net realized gain (loss)..........................       38,725       (10,121)
                                                   ------------  ------------
Net increase (decrease) in net assets resulting
 from operations..................................    4,569,982     4,111,131
                                                   ------------  ------------
DIVIDENDS AND/OR DISTRIBUTIONS TO SHAREHOLDERS....   (4,531,257)   (4,121,252)
                                                   ------------  ------------
BENEFICIAL INTEREST TRANSACTIONS
Net increase (decrease) in net assets resulting
 from beneficial interest transactions............   (4,982,869)    6,431,149
                                                   ------------  ------------
NET ASSETS
Total increase (decrease).........................   (4,944,144)    6,421,028
Beginning of period...............................  162,260,505   155,839,477
                                                   ------------  ------------
End of period..................................... $157,316,361  $162,260,505
                                                   ============  ============

See accompanying Notes to Financial Statements. 8 Financial Highlights Centennial California Tax Exempt Trust

                                      Year Ended June 30,
                            2001      2000           1999           1998           1997
                          --------  --------       --------       --------       --------

PER SHARE OPERATING DATA
Net asset value,
 beginning of period....     $1.00     $1.00          $1.00          $1.00          $1.00
Income from investment
 operations--net
 investment income and
 net realized gain......       .03       .03            .02            .03            .03
Dividends and/or
 distributions to
 shareholders...........      (.03)     (.03)          (.02)          (.03)          (.03)
                          --------  --------       --------       --------       --------
Net asset value, end of
 period.................     $1.00     $1.00          $1.00          $1.00          $1.00
                          ========  ========       ========       ========       ========
TOTAL RETURN(/1/).......      2.74%     2.63%          2.41%          2.86%          2.81%
RATIOS/SUPPLEMENTAL DATA
Net assets, end of
 period (in thousands)..  $157,316  $162,261       $155,839       $155,832       $131,939
Average net assets (in
 thousands).............  $166,654  $160,351       $168,272       $160,317       $129,087
Ratios to average net
 assets:(/2/)
Net investment income...      2.72%     2.57%          2.38%          2.81%          2.78%
Expenses................      0.84%     0.83%          0.80%          0.80%(/3/)     0.82%(/3/)
Expenses, net of
 reduction to custodian
 expenses...............      0.82%     0.81%(/4/)     0.78%(/4/)     0.79%(/4/)     0.80%(/4/)
Expenses, net of
 reduction to excess
 expenses...............      0.81%      N/A            N/A            N/A            N/A

1. Assumes a $1,000 hypothetical initial investment on the business day before the first day of the fiscal period, with all dividends reinvested in additional shares on the reinvestment date, and redemption at the net asset value calculated on the last business day of the fiscal period. Total returns reflect changes in net investment income only. Total returns are not annualized for periods of less than one full year.

2. Annualized for periods of less than one full year. 3. Expense ratio reflects the reduction to custodian expenses. 4. Prior to June 30, 2001, this ratio reflected the combined net effect of reduction to excess and custodian expenses. See accompanying Notes to Financial Statements. 9 Notes to Financial Statements Centennial California Tax Exempt Trust 1. Significant Accounting Policies

Centennial California Tax Exempt Trust (the Trust) is registered under the Investment Company Act of 1940, as amended, as a non-diversified, open-end management investment company. The Trust’s investment objective is to seek the maximum current interest income exempt from federal and California personal income taxes for individual investors as is consistent with the preservation of capital. The Trust’s investment advisor is Centennial Asset Management Corporation (the Manager), a subsidiary of OppenheimerFunds, Inc. (OFI). The following is a summary of significant accounting policies consistently followed by the Trust.

Securities Valuation. Portfolio securities are valued on the basis of amortized cost, which approximates market value.

Federal Taxes. The Trust intends to continue to comply with provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its taxable income to shareholders. Therefore, no federal income or excise tax provision is required.

As of June 30, 2001, the Trust had available for federal income tax purposes an unused capital loss carryover as follows:

   Expiring
   --------

   2008       $3,769


Dividends and Distributions to Shareholders.  Dividends and distributions to
shareholders, which are determined in accordance with income tax regulations,
are recorded on the ex-dividend date.

Investment Income. There are certain risks arising from geographic
concentration in any state. Certain revenue or tax-related events in a state
may impair the ability of certain issuers of municipal securities to pay
principal and interest on their obligations.

Security Transactions. Security transactions are accounted for as of trade
date. Gains and losses on securities sold are determined on the basis of
identified cost.

Other. 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 income and
expenses during the reporting period. Actual results could differ from those
estimates.

10


Notes to Financial Statements (Continued)

Centennial California Tax Exempt Trust


2. Shares of Beneficial Interest

The Trust has authorized an unlimited number of no par value shares
of beneficial interest. Transactions in shares of beneficial interest
were as follows:

                          Year Ended June 30, 2001     Year Ended June 30, 2000
                         ---------------------------  ---------------------------
                            Shares        Amount         Shares        Amount
                         ------------  -------------  ------------  -------------

Sold....................  587,490,874  $ 587,490,874   568,522,086  $ 568,522,086
Dividends and/or
 distributions
 reinvested.............    4,550,870      4,550,870     3,943,530      3,943,530
Redeemed................ (597,024,613)  (597,024,613) (566,034,467)  (566,034,467)
                         ------------  -------------  ------------  -------------
Net increase
 (decrease).............   (4,982,869) $  (4,982,869)    6,431,149  $   6,431,149
                         ============  =============  ============  =============

3. Fees and Other Transactions with Affiliates

Management Fees. Management fees paid to the Manager were in accordance with the investment advisory agreement with the Trust which provides for a fee of 0.50% of the first $250 million of net assets; 0.475% of the next $250 million of net assets; 0.45% of the next $250 million of net assets; 0.425% of the next $250 million of net assets; and 0.40% of net assets in excess of $1 billion. The Manager has voluntarily undertaken to assume any expenses of the Trust in any fiscal year they exceed 0.80% of the Trust’s average annual net assets. The Manager reserves the right to amend or terminate that expense assumption at any time. The Trust’s management fee for the year ended June 30, 2001, was an annualized rate of 0.50%.

Transfer Agent Fees. Shareholder Services, Inc. (SSI) acts as the transfer and shareholder servicing agent for the Trust and for other registered investment companies. The Trust pays SSI an annual maintenance fee for each Trust shareholder account.

Service Plan Fees. Under an approved service plan, the Trust may expend up to 0.20% of its average annual net assets annually to reimburse the Manager, as distributor, for costs incurred in connection with the personal service and maintenance of accounts that hold shares of the Trust, including amounts paid to brokers, dealers, banks and other financial institutions.

11 A-3 Appendix A Description of Securities Ratings Below is a description of the two highest rating categories for Short Term Debt and Long Term Debt by the "Nationally-Recognized Statistical Rating Organizations" which the Manager evaluates in purchasing securities on behalf of the Fund. The ratings descriptions are based on information supplied by the ratings organizations to subscribers. SHORT TERM DEBT RATINGS. Moody's Investors Service, Inc. ("Moody's") The following rating designations for commercial paper (defined by Moody's as promissory obligations not having original maturity in excess of nine months), are judged by Moody's to be investment grade, and indicate the relative repayment capacity of rated issuers: Prime-1: Superior capacity for repayment. Capacity will normally be evidenced by the following characteristics: (a) leading market positions in well-established industries; (b) high rates of return on funds employed; (c) conservative capitalization structure with moderate reliance on debt and ample asset protection; (d) broad margins in earning coverage of fixed financial charges and high internal cash generation; and (e) well-established access to a range of financial markets and assured sources of alternate liquidity. Prime-2: Strong capacity for repayment. This will normally be evidenced by many of the characteristics cited above but to a lesser degree. Earnings trends and coverage ratios, while sound, will be more subject to variation. Capitalization characteristics, while still appropriate, may be more affected by external conditions. Ample alternate liquidity is maintained. Moody's ratings for state and municipal short-term obligations are designated "Moody's Investment Grade" ("MIG"). Short-term notes which have demand features may also be designated as "VMIG". These rating categories are as follows: MIG 1/VMIG 1: Denotes superior credit quality. Excellent protection is afforded by established cash flows, highly reliable liquidity support or demonstrated broad-based access to the market for refinancing. MIG 2/VMIG 2: Denotes strong credit quality. Margins of protection are ample although not as large as in the preceding group. Standard & Poor's Ratings Services, a division of The McGraw-Hill Companies, Inc. ("Standard and Poor's") - --------------------------------------------------------------------------------------------------------- The following ratings by Standard and Poor's for commercial paper (defined by Standard and Poor's as debt having an original maturity of no more than 365 days) assess the likelihood of payment: A-1: Obligation is rated in the highest category. The obligor's capacity to meet its financial commitment on the obligation is strong. Within this category, a plus (+) sign designation indicates the obligor's capacity to meet its financial obligation is extremely strong. A-2: Obligation is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher rating categories. However, the obligor's capacity to meet its financial commitment on the obligation is satisfactory. Standard and Poor's ratings for Municipal Notes due in 3 years or less: - ------------------------------------------------------------------------ SP-1: Strong capacity to pay principal and interest. An issue determined to possess a very strong capacity to pay debt service is given a (+) designation. SP-2: Satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and economic changes over the term of the notes. Standard and Poor's assigns "dual ratings" to all municipal debt issues that have a demand or double feature as part of their provisions. The first rating addresses the likelihood of repayment of principal and interest as due, and the second rating addresses only the demand feature. With short-term demand debt, Standard and Poor's note rating symbols are used with the commercial paper symbols (for example, "SP-1+/A-1+"). Fitch, Inc. ("Fitch") - --------------------- Fitch assigns the following short-term ratings to debt obligations that are payable on demand or have original maturities of generally up to three years, including commercial paper, certificates of deposit, medium-term notes, and municipal and investment notes: F1: Highest credit quality. Strongest capacity for timely payment of financial commitments. May have an added "+" to denote any exceptionally strong credit feature. F2: Good credit quality. A satisfactory capacity for timely payment of financial commitments, but the margin of safety is not as great as in the case of higher ratings. LONG TERM DEBT RATINGS. These ratings are relevant for securities purchased by the Fund with a remaining maturity of 397 days or less, or for rating issuers of short-term obligations. Moody's - ------- Bonds (including municipal bonds) are rated as follows: Aaa: Judged to be the best quality. They carry the smallest degree of investment risk and are generally referred to as "gilt edged." Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, the changes that can be expected are most unlikely to impair the fundamentally strong position of such issues. Aa: Judged to be of high quality by all standards. Together with the "Aaa" group, they comprise what are generally known as high-grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as with "Aaa" securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risk appear somewhat larger than that of "Aaa" securities. Moody's applies numerical modifiers "1", "2" and "3" in its "Aa" rating classification. The modifier "1" indicates that the obligation ranks in the higher end of its generic rating category; the modifier "2" indicates a mid-range ranking; and the modifier "3" indicates a ranking in the lower end of that generic rating category. Standard and Poor's - ------------------- Bonds (including municipal bonds maturing beyond 3 years) are rated as follows: AAA: Bonds rated "AAA" have the highest rating assigned by Standard & Poor's. The obligor's capacity to meet its financial commitment on the obligation is extremely strong. AA: Bonds rated "AA" differ from the highest rated obligations only in small degree. A strong capacity to meet its financial commitment on the obligation is very strong. Fitch - ----- AAA: Highest Credit Quality. "AAA" ratings denote the lowest expectation of credit risk. They are assigned only in the case of exceptionally strong capacity for timely payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events. AA: Very High Credit Quality. "AA" ratings denote a very low expectation of credit risk. They indicate a very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events. Because bonds rated in the "AAA" and "AA" categories are not significantly vulnerable to foreseeable future developments, short-term debt of these issuers is generally rated "F-1+".

                                                                B-1

                                                              Appendix B

                                                Municipal Bond Industry Classifications

Adult Living Facilities
Bond Anticipation Notes
Education
Electric Utilities
Gas Utilities
General Obligation
Higher Education
Highways/Railways
Hospital/Healthcare
Manufacturing, Durable Goods
Manufacturing, Non Durable Goods
Marine/Aviation Facilities
Multi-Family Housing
Municipal Leases
Non Profit Organization
Parking Fee Revenue
Pollution Control
Resource Recovery
Revenue Anticipation Notes
Sales Tax Revenue
Sewer Utilities
Single Family Housing
Special Assessment
Special Tax
Sports Facility Revenue
Student Loans
Tax Anticipation Notes
Tax & Revenue Anticipation Notes
Telephone Utilities
Water Utilities









                                                                33

- ---------------------------------------------------------------------------------------------------------------------------------------
Centennial California Tax Exempt Trust
- ---------------------------------------------------------------------------------------------------------------------------------------

Investment Advisor and Distributor
Centennial Asset Management Corporation
6803 South Tucson Way
Englewood, Colorado 80112

Sub-Distributor
OppenheimerFunds Distributor, Inc.
P.O. Box 5254
Denver, Colorado 80217

Transfer Agent
Shareholder Services, Inc.
P.O. Box 5143
Denver, Colorado 80217
1.800.525.9310

Custodian of Portfolio Securities
Citibank, N.A.
399 Park Avenue
New York, New York 10043

Independent Auditors
Deloitte & Touche LLP
555 Seventeenth Street
Denver, Colorado 80202

Legal Counsel
Myer, Swanson, Adams & Wolf, P.C.
1600 Broadway
Denver, Colorado 80202



PX0180.001.(rev)070102





- --------

1 PartnersMr. Grabish is only a Trustee of Centennial Money Market Trust, Centennial Tax Exempt Trust, Centennial Government Trust,
Centennial New York Tax Exempt Trust and Centennial California Tax Exempt Trust and a Managing General Partner of Centennial America
Fund, L.P.  Mr. Malone and Mrs. Hamilton are not Trustees of Oppenheimer Senior Floating Rate Fund.
2. In  accordance  with Rule 12b-1 of the  Investment  Company Act, the term  "Independent  Trustees" in this  Statement of  Additional
Information  refers  to those  Trustees  who are not  "interested  persons"  of the Fund and who do not  have any  direct  or  indirect
financial interest in the operation of any agreement under the plan.