-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, FGd0Ve5n0APhmnSpyycE0ZSA/tzHOP9f6N7VMhbgcmH6LLfxrXzVP9ke4ZTdgvUB 3iblNw+TlZbz75XTmklKig== 0000891804-04-001268.txt : 20040609 0000891804-04-001268.hdr.sgml : 20040609 20040609111237 ACCESSION NUMBER: 0000891804-04-001268 CONFORMED SUBMISSION TYPE: N-CSR PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20040331 FILED AS OF DATE: 20040609 EFFECTIVENESS DATE: 20040609 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NUVEEN CALIFORNIA SELECT TAX FREE INCOME PORTFOLIO CENTRAL INDEX KEY: 0000885732 IRS NUMBER: 363828111 STATE OF INCORPORATION: MA FILING VALUES: FORM TYPE: N-CSR SEC ACT: 1940 Act SEC FILE NUMBER: 811-06623 FILM NUMBER: 04855126 BUSINESS ADDRESS: STREET 1: 333 W WACKER DR CITY: CHICAGO STATE: IL ZIP: 60606 BUSINESS PHONE: 3129178200 FORMER COMPANY: FORMER CONFORMED NAME: NUVEEN INSURED CALIFORNIA SELECT TAX FREE INCOME PORTFOLIO DATE OF NAME CHANGE: 19920929 FORMER COMPANY: FORMER CONFORMED NAME: NUVEEN CALIFORNIA SELECT TAX FREE INCOME PORTFOLIO DATE OF NAME CHANGE: 19600201 N-CSR 1 file001.txt NUVEEN CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-CSR CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT COMPANIES Investment Company Act file number 811-6623 --------------------- Nuveen California Select Tax-Free Income Portfolio ------------------------------------------------------------------------------ (Exact name of registrant as specified in charter) Nuveen Investments 333 West Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------ (Address of principal executive offices) (Zip code) Jessica R. Droeger Nuveen Investments 333 West Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------ (Name and address of agent for service) Registrant's telephone number, including area code: (312) 917-7700 ------------------- Date of fiscal year end: March 31 ------------------ Date of reporting period: March 31, 2004 ------------------ Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles. A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. ss. 3507. ITEM 1. REPORTS TO STOCKHOLDERS. Nuveen Investments Municipal Closed-End Exchange-Traded Funds ANNUAL REPORT March 31, 2004 NUVEEN SELECT TAX-FREE INCOME PORTFOLIO NXP NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 2 NXQ NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 3 NXR NUVEEN CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO NXC NUVEEN NEW YORK SELECT TAX-FREE INCOME PORTFOLIO NXN Photo of: Man holding up small boy. Photo of: 2 women with 2 girls looking at seashells. DEPENDABLE, TAX-FREE INCOME BECAUSE IT'S NOT WHAT YOU EARN, IT'S WHAT YOU KEEP.(R) Logo: NUVEEN Investments FASTER INFORMATION RECEIVE YOUR NUVEEN FUND REPORT ELECTRONICALLY By registering for electronic delivery, you will receive an e-mail as soon as your Nuveen Fund information is available. Click on the link and you will be taken directly to the report. Your Fund report can be viewed and saved on your computer. Your report will arrive faster via e-mail than by traditional mail. Registering is easy and only takes a few minutes (see instructions at right). - -------------------------------------------------------------------------------- SOME COMMON CONCERNS: WILL MY E-MAIL ADDRESS BE DISTRIBUTED TO OTHER COMPANIES? No, your e-mail address is strictly confidential and will not be used for anything other than notification of shareholder information. WHAT IF I CHANGE MY MIND AND WANT TO RECEIVE INVESTOR MATERIALS THROUGH REGULAR MAIL DELIVERY AGAIN? If you decide you do not like receiving your reports electronically, it's a simple process to go back to regular mail delivery. - -------------------------------------------------------------------------------- IF YOUR NUVEEN FUND DIVIDENDS AND STATEMENTS COME FROM YOUR FINANCIAL ADVISOR OR BROKERAGE ACCOUNT, FOLLOW THE STEPS OUTLINED BELOW: 1 Go to WWW.INVESTORDELIVERY.COM and follow the simple instructions, using the address sheet that accompanied this report as a guide. 2 You'll be taken to a page with several options. Select the NEW ENROLLMENT-CREATE screen and follow the simple instructions. 3 Click Submit. Confirm the information you just entered is correct, then click Submit again. 4 You should get a confirmation e-mail within 24 hours. If you do not, go back through these steps to make sure all the information is correct. 5 Use this same process if you need to change your registration information or cancel internet viewing. IF YOUR NUVEEN FUND DIVIDENDS AND STATEMENTS COME DIRECTLY TO YOU FROM NUVEEN, FOLLOW THE STEPS OUTLINED BELOW: 1 Go to WWW.NUVEEN.COM 2 Select ACCESS YOUR ACCOUNT. Select the E-REPORT ENROLLMENT section. Click on Enrollment Today. 3 You'll be taken to a screen that asks for your Social Security number and e-mail address. Fill in this information, then click Enroll. 4 You should get a confirmation e-mail within 24 hours. If you do not, go back through these steps to make sure all the information is correct. 5 Use this same process if you need to change your registration information or cancel internet viewing. Logo: NUVEEN Investments Photo of: Timothy R. Schwertfeger Chairman of the Board Sidebar text: WE THINK THAT MUNICIPAL BOND INVESTMENTS LIKE YOUR NUVEEN FUND CAN BE IMPORTANT BUILDING BLOCKS IN A WELL-BALANCED PORTFOLIO. Dear SHAREHOLDER I am very pleased to report that for the period ended March 31, 2004, your Nuveen Fund continued to provide you with attractive monthly tax-free income. While tax-free income always is welcome, many of you may have begun to wonder whether interest rates will rise, and whether that possibility should cause you to adjust your holdings of tax-free municipal bond investments. We believe that these are questions that should be thought through with a clear focus on your long-term financial goals and not on day-to-day market movements. By maintaining a carefully balanced portfolio with the help of a trusted investment professional, you may be able to reduce your overall investment risk over the long-term, and give yourself a better chance to meet your ultimate financial goals. As you read through this report, please don't skip the inside front cover. I urge you to consider receiving future Fund reports and other Fund information by e-mail and the Internet. Not only will you be able to receive the information faster, but this also may help lower your Fund's expenses. Sign up is quick and easy. Since 1898, Nuveen Investments has offered financial products and solutions that incorporate careful research, diversification and the application of conservative risk-management principles. We are grateful that you have chosen us as a partner as you pursue your financial goals. We look forward to continuing to earn your trust in the months and years ahead. Sincerely, /s/ Timothy R. Schwertfeger Timothy R. Schwertfeger Chairman of the Board May 15, 2004 1 Nuveen Select Portfolios NXP, NXQ, NXR, NXC, NXN Portfolio Managers' COMMENTS Portfolio managers Tom Spalding, Scott Romans, and Paul Brennan review the market environment at the national and state levels, key investment strategies, and the annual performance of the Nuveen Select Tax-Free Income Portfolios. With 29 years of investment experience, Tom has managed NXP, NXQ, and NXR since 1999. Scott, who joined Nuveen in 2000, and Paul, who has 13 years of investment experience, assumed portfolio management responsibility for NXC and NXN, respectively, in January 2003. WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE REPORTING PERIOD ENDED MARCH 31, 2004? During this reporting period, the greatest influences on the national economy and the municipal market continued to be historically low interest rates, little movement in the reported rate of inflation and growing evidence of economic improvement. Since its last credit easing in June 2003, the Federal Reserve has maintained the fed funds rate at 1.0%, the lowest level since 1958. This accommodative monetary policy helped to spur GDP (gross domestic product) growth of 4.2% (annualized) in the first quarter of 2004, following a 3.1% rise in 2003. This generally favorable environment helped many municipal bonds perform well during the 12 months ended March 31, 2004. Nationally, municipal supply reached $382.7 billion in 2003, breaking the record set in 2002, although issuance slowed somewhat during the second half of 2003. Tighter supply continued into the first two months of 2004 before issuance picked up significantly in March. HOW WERE ECONOMIC AND MARKET CONDITIONS IN CALIFORNIA AND NEW YORK? In California, the political uncertainty surrounding the recall initiative served to further complicate the state's financial difficulties. The California economy remained hindered by the slow recovery of the technology sector, and the state continued to lose jobs in government, manufacturing, and business services. This was offset to some degree by California's strong housing market, which fueled growth in construction, financial services, and consumer spending, while increased defense spending had positive implications for the state's aerospace industry. In addition, California's $100 billion export industry was aided by the decline in the U.S. dollar over this period. Moody's and Fitch downgraded California's general obligation debt to Baa1/BBB from A3/A in December 2003. Standard & Poor's, which had downgraded the state in July 2003, kept its rating at BBB, and all three agencies maintained negative outlooks. However, in March 2004, California voters approved the issuance of $15 billion in economic recovery bonds as well as a resolution calling for future limits on spending and borrowing. Moody's and S&P subsequently revised their outlooks for California to stable and positive, respectively. New York continued to recover from financial problems triggered by the national economic downturn and deepened by the terrorist attacks of 2001. Although increased Wall Street activity and a rebounding tourism industry had positive implications for the state's economy and future tax revenues, New York continued to slightly lag the national pace of recovery during this reporting period. 2 New York was the largest issuer in the nation during the first three months of 2004, with $11 billion in new paper. In February 2004, Standard & Poor's (S&P) reconfirmed its rating of New York's general obligation debt at AA with a negative outlook, while Moody's and Fitch maintained their ratings of A2 with a stable outlook and AA-, respectively. As of March 31, 2004, New York City was rated A2/A/A+, by Moody's, S&P and Fitch, respectively, with all three rating agencies returning their outlooks for the city to stable from negative over the past year. California and New York continued to rank as the nation's largest issuers of municipal debt in 2003, with $58 billion (an increase of 18% over 2002) and $42 billion (a decline of 14%) in new bonds, respectively. For the first three months of 2004, however, California supply fell 37% from January-March 2003 levels, with total issuance of $10 billion. In New York, supply was more plentiful during the first three months of 2004, with $11 billion in new paper, an increase of 20% over January-March 2003. IN THIS ENVIRONMENT, WHAT KEY STRATEGIES WERE USED TO MANAGE THE PORTFOLIOS DURING THE 12 MONTHS ENDED MARCH 31, 2004? Over this reporting period, we continued to work on transitioning the Select Portfolios from their previous positioning with fixed termination dates, largely static portfolios, intermediate durations1 and, in the case of NXC and NXN, 100% insured portfolios. As part of this transition, one of our priorities during this period was duration management, with the goal of enhancing the Portfolios' performance potential and positioning them to produce potentially more consistent returns over time. To implement this strategy, we took advantage of attractive opportunities to sell bonds with shorter durations--pre-refunded bonds, bonds with short call dates, and bonds that mature in the next year or two--and reinvested the proceeds, as well as proceeds from called bonds, in bonds with longer durations to extend the Portfolios' durations. In keeping with the steepness of the municipal bond yield curve over this period, the majority of our purchase activity focused on securities in the long-intermediate part of the yield curve. In the national Portfolios, this meant bonds that mature in 20 to 25 years, while NXC and NXN focused on maturities of 15 to 20 years. In many cases, bonds in this area of the curve offered yields similar to those of longer-term bonds with less inherent interest rate risk. Over the course of this annual period, we were able to extend the durations of NXP, NXQ, and NXC, while the duration of NXN remained essen tially unchanged for the period ended March 31, 2004. NXR's duration shortened slightly. Although the heavy volume of municipal issuance during 2003 provided opportunities to make trades that would benefit the Portfolios, we saw supply soften in California and New York as well as at the national level during the last half of 2003. As noted earlier, tighter supply also continued into the first quarter of 2004 in the California market. This presented some challenges in finding securities that we believed had the potential to add value and that carried the types of structures and features we prefer. 1 Duration is a measure of a Portfolio's net asset value (NAV) volatility in reaction to interest rate movements. 3 For NXP, NXQ, and NXR, our emphasis was on maintaining the Portfolios' credit quality by purchasing high-quality bonds as credit spreads remained narrow, improving call exposure by reinvesting proceeds in issues with at least eight years of call protection, and watching both the primary and secondary markets for bonds that can help these Portfolios achieve their long-term objectives. For NXC, as we continued to work to diversify the credit quality of the Portfolio over this period, we were active buyers of bonds rated BBB, including toll roads, water and sewer, tobacco, and general obligation (GO) bonds. One of our strategies over the longer term has centered on purchasing and selling California GOs to take advantage of general market moves. In February 2004, we bought part of the $2 billion issuance of state GOs at an attractive yield, with the goal of modestly increasing NXC's exposure to this sector of the market. As California continues to work its way out of its current credit problems, we anticipate that the yield spreads on these bonds relative to national AAA credits with similar maturities may narrow, providing us with opportunities to sell some of these GO holdings at attractive prices in the future. While our objectives and management strategies were similar in NXN, the New York market did not provide as many lower-rated opportunities as California did over the past 12 months. As of March 31, 2004, NXN continued to have the highest percentage of bonds rated AAA/U.S guaranteed among these five Portfolios at 81%, down from 86% in March 2003. Of this 81%, more than two-thirds were insured. As with NXC, we used proceeds from the sale of pre-refunded bonds to purchase lower-rated securities as appropriate opportunities became available in the New York market during this period. HOW DID THE PORTFOLIOS PERFORM? Individual results for the Portfolios, as well as for relevant benchmarks, are presented in the accompanying table. TOTAL RETURNS ON NET ASSET VALUE For periods ended 3/31/04 (annualized) NATIONAL PORTFOLIOS 1-YEAR 5-YEAR 10-YEAR - --------------------------------------------------------- NXP 6.13% 5.24% 6.38% - --------------------------------------------------------- NXQ 6.31% 4.88% 6.11% - --------------------------------------------------------- NXR 6.13% 4.86% 6.25% - --------------------------------------------------------- Lehman Brothers Municipal Bond Index2 5.86% 6.00% 6.81% - --------------------------------------------------------- Lipper General and Insured Unleveraged Municipal Debt Funds average3 6.11% 4.73% 6.06% - --------------------------------------------------------- CALIFORNIA PORTFOLIO - --------------------------------------------------------- NXC 6.16% 4.80% 6.20% - --------------------------------------------------------- Lehman Brothers CA Tax- Exempt Bond Index2 5.88% 5.74% 6.87% - --------------------------------------------------------- Lipper CA Municipal Debt Funds average3 8.31% 6.12% 7.29% - --------------------------------------------------------- NEW YORK PORTFOLIO - --------------------------------------------------------- NXN 5.84% 4.97% 6.03% - --------------------------------------------------------- Lehman Brothers NY Tax- Exempt Bond Index2 5.73% 6.00% 6.91% - --------------------------------------------------------- Lipper NY Municipal Debt Funds average3 9.00% 6.25% 6.92% - --------------------------------------------------------- Data represents past performance which is no guarantee of future results. Current performance may be higher or lower than the performance shown. For additional information, see the individual Performance Overview for your Portfolio in this report. 2 The Lehman Brothers Municipal Bond Index is an unleveraged, unmanaged national index comprising a broad range of investment-grade municipal bonds. The Lehman Brothers Tax-Exempt Bond Indexes for California and New York are unleveraged, unmanaged indexes consisting of a broad range of municipal bonds issued in California and New York, respectively. Results for the Lehman indexes do not reflect any expenses. 3 The Lipper General and Insured Unleveraged Municipal Debt Funds category average is calculated using the returns of all closed-end exchange-traded funds in this category for each period as follows: 1 year, 9 funds; 5 years, 9; and 10 years, 9. The Lipper California Municipal Debt Funds category average is based on the returns of all closed-end exchange-traded funds in this category as follows: 1 year, 30 funds; 5 years, 18; and 10 years, 17. The Lipper New York Municipal Debt Funds category average is based on the returns of all closed-end exchange-traded funds in this category as follows: 1 year, 22 funds; 5 years, 11; and 10 years, 10. Portfolio and Lipper returns assume reinvestment of dividends. 4 For the 12 months ended March 31, 2004, the total returns of all five of the Select Portfolios outperformed their respective Lehman Brothers benchmarks. In addition to the duration management strategies discussed in the previous section, sector weightings and individual security selection were among the primary factors that influenced the Portfolios' performances over the 12 month period. For example, during this period, the healthcare sector, as measured by the Lehman Municipal Bond Index, ranked second in terms of performance, outperforming the market as a whole by approximately 120 basis points. Each of the Portfolios had a substantial allocation of healthcare bonds, ranging from 10% in NXN to 15% in NXC, 16% in NXQ, 17% in NXP, and 18% in NXR as of March 31, 2004, which benefited their performances. In addition, the past 12 month period saw increased market demand for high-yield paper, which caused credit spreads to narrow. In this environment, the Portfolios benefited from their holdings of lower-rated credits, as bonds rated BBB outperformed the market as a whole over this period. As of March 31, 2004, allocations of BBB bonds ranged from 4% in NXN, 7% in NXP, and 9% in NXR to 11% in NXQ and 14% in NXC. Among the lower-rated holdings making a positive contribution to the Portfolios' total annual returns were tobacco bonds, most of which were rated BBB over the majority of this reporting period. These bonds appreciated strongly during the last half of this period as the result of some favorable legal developments. Over this period, we maintained our exposure to tobacco-backed bonds at approximately 2% of NXP, 2% of NXN, and 5% of NXQ and NXR. In April 2004, following the end of this reporting period, Moody's announced a ratings downgrade on all tobacco securities that were not enhanced or additionally secured, based on an adverse ruling in a tobacco-related lawsuit in New York. As of April 21, 2004, the majority of the Portfolios' tobacco bond holdings were downgraded to Baa1, Baa2, or Baa3. It is important to note, however, that the other major credit agencies--S&P and Fitch--did not change their ratings based on the litigation cited by Moody's. We continue to closely monitor all of these tobacco holdings. HOW ABOUT THE PORTFOLIOS' DIVIDENDS AND SHARE PRICES? With call exposure affecting up to 28% of their portfolios during 2003, the Select Portfolios continued to face the need to reinvest proceeds from called bonds over the 12 months ended March 31, 2004. This meant that older bonds offering higher coupons had to be replaced with the bonds available in a market where interest rates remained at historically low levels. While we were able to maintain the dividend of NXR, the number of calls necessitated a single dividend cut in each of the four remaining Portfolios over the 12 month period. All of these Portfolios seek to pay stable dividends at rates that reflect each Portfolio's past results and projected future performance. During certain periods, each Portfolio may pay dividends at a rate 5 that may be more or less than the amount of net investment income actually earned by the Portfolio during the period. If a Portfolio has cumulatively earned more than it has paid in dividends, it holds the excess in reserve as undistributed net investment income (UNII) as part of the Portfolio's net asset value (NAV). Conversely, if a Portfolio has cumulatively paid dividends in excess of its earnings, the excess constitutes negative UNII that is likewise reflected in the Portfolio's NAV. Each Portfolio will, over time, pay all of its net investment income as dividends to shareholders. As of March 31, 2004, NXN had positive UNII, while NXQ, NXP, NXR, and NXC had negative UNII. At the close of this reporting period on March 31, 2004, all five Portfolios were trading at discounts to their common share NAVs (see charts on individual Performance Overview pages). HOW WERE THE PORTFOLIOS POSITIONED IN TERMS OF CREDIT QUALITY AND BOND CALLS AS OF MARCH 31, 2004? Given the current geopolitical and economic climate, we continued to believe that maintaining strong credit quality was a vital requirement. As of the end of March 2004, all five of the Select Portfolios continued to offer excellent credit quality, with allocations of bonds rated AAA/U.S. guaranteed and AA ranging from 69% in NXC, 71% in NXR, 76% in NXP, and 79% in NXQ to 96% in NXN. At the same time, NXC also had an increase in its holdings rated BBB or lower, due in part to the downgrade of California general obligation bonds by Moody's and Fitch in December 2003. We also purchased additional BBB bonds for the portfolio. As of March 31, 2004, potential call exposure for these Portfolios during 2004-2005 ranged from 13% in NXN, 14% in NXP and NXC to 19% in NXQ and NXR. The actual number of bond calls in all of the Portfolios depends largely on market interest rates. 6 Nuveen Select Tax-Free Income Portfolio Performance OVERVIEW As of March 31, 2004 NXP Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 58% AA 18% A 16% BBB 7% BB or lower 1% FUND SNAPSHOT - -------------------------------------------------- Share Price $14.30 - -------------------------------------------------- Common Share Net Asset Value $14.85 - -------------------------------------------------- Premium/(Discount) to NAV -3.70% - -------------------------------------------------- Market Yield 5.12% - -------------------------------------------------- Taxable-Equivalent Yield1 7.11% - -------------------------------------------------- Net Assets ($000) $243,165 - -------------------------------------------------- Average Effective Maturity (Years) 14.66 - -------------------------------------------------- Duration 5.68 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 3/19/92) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 7.34% 6.13% - -------------------------------------------------- 5-Year 3.63% 5.24% - -------------------------------------------------- 10-Year 6.34% 6.38% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Healthcare 17% - -------------------------------------------------- Tax Obligation/Limited 16% - -------------------------------------------------- U.S. Guaranteed 15% - -------------------------------------------------- Transportation 14% - -------------------------------------------------- Utilities 10% - -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 Apr 0.062 May 0.062 Jun 0.062 Jul 0.062 Aug 0.062 Sep 0.061 Oct 0.061 Nov 0.061 Dec 0.061 Jan 0.061 Feb 0.061 Mar 0.061 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 4/1/03 13.86 13.9 13.95 13.9 14.14 14.07 14.13 14.6 14.42 14.49 14.5 14.51 14.28 13.76 13.41 13.84 13.6 13.5 13.51 13.85 13.9 13.82 13.98 13.88 13.7 13.75 13.7 13.61 13.72 13.66 13.77 13.5 13.49 13.65 13.78 13.92 13.94 13.9 14.1 14.43 14.2 14.07 14.08 14.36 14.23 3/31/04 14.29 1 Taxable-equivalent yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a federal income tax rate of 28%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 2 The Fund also paid shareholders capital gains and net ordinary income distributions in December 2003 of $0.1059 per share. 7 Nuveen Select Tax-Free Income Portfolio 2 Performance OVERVIEW As of March 31, 2004 NXQ Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 54% AA 25% A 9% BBB 11% BB or lower 1% FUND SNAPSHOT - -------------------------------------------------- Share Price $13.80 - -------------------------------------------------- Common Share Net Asset Value $14.56 - -------------------------------------------------- Premium/(Discount) to NAV -5.22% - -------------------------------------------------- Market Yield 5.09% - -------------------------------------------------- Taxable-Equivalent Yield1 7.07% - -------------------------------------------------- Net Assets ($000) $256,373 - -------------------------------------------------- Average Effective Maturity (Years) 17.16 - -------------------------------------------------- Duration 5.13 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 5/21/92) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 8.35% 6.31% - -------------------------------------------------- 5-Year 3.49% 4.88% - -------------------------------------------------- 10-Year 6.36% 6.11% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Transportation 16% - -------------------------------------------------- Healthcare 16% - -------------------------------------------------- Utilities 15% - -------------------------------------------------- Tax Obligation/Limited 13% - -------------------------------------------------- U.S. Guaranteed 10% - -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 Apr 0.0605 May 0.0605 Jun 0.0605 Jul 0.0605 Aug 0.0605 Sep 0.0585 Oct 0.0585 Nov 0.0585 Dec 0.0585 Jan 0.0585 Feb 0.0585 Mar 0.0585 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 4/1/03 13.36 13.36 13.44 13.38 13.53 13.68 13.8 13.87 14.03 14.03 14.05 14.01 13.89 13.75 13.18 13.31 13.04 13.02 13.06 13.2 13.15 13.23 13.2 13.15 13.15 13.14 13.13 13.18 13.24 13.18 13.25 13.2 13.21 13.27 13.45 13.45 13.53 13.5 13.55 13.73 13.67 13.65 13.76 13.79 13.79 3/31/04 13.82 1 Taxable-equivalent yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a federal income tax rate of 28%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 2 The Fund also paid shareholders capital gains and net ordinary income distributions in December 2003 of $0.0646 per share. 8 Nuveen Select Tax-Free Income Portfolio 3 Performance OVERVIEW As of March 31, 2004 NXR Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 44% AA 27% A 20% BBB 9% FUND SNAPSHOT - -------------------------------------------------- Share Price $13.56 - -------------------------------------------------- Common Share Net Asset Value $14.37 - -------------------------------------------------- Premium/(Discount) to NAV -5.64% - -------------------------------------------------- Market Yield 5.09% - -------------------------------------------------- Taxable-Equivalent Yield1 7.07% - -------------------------------------------------- Net Assets ($000) $186,358 - -------------------------------------------------- Average Effective Maturity (Years) 16.32 - -------------------------------------------------- Duration 5.19 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 7/24/92) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 9.96% 6.13% - -------------------------------------------------- 5-Year 3.68% 4.86% - -------------------------------------------------- 10-Year 6.18% 6.25% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Utilities 22% - -------------------------------------------------- Healthcare 18% - -------------------------------------------------- Tax Obligation/Limited 12% - -------------------------------------------------- Tax Obligation/General 8% - -------------------------------------------------- U.S. Guaranteed 8% - -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 Apr 0.0575 May 0.0575 Jun 0.0575 Jul 0.0575 Aug 0.0575 Sep 0.0575 Oct 0.0575 Nov 0.0575 Dec 0.0575 Jan 0.0575 Feb 0.0575 Mar 0.0575 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 4/1/03 12.98 12.97 13.05 13.14 13.21 13.31 13.45 13.57 13.77 13.76 13.66 13.64 13.56 13.05 13.05 13.02 12.77 12.77 12.85 12.87 12.92 12.94 13 12.87 12.8 13 12.97 12.92 12.89 13 13.02 13.06 12.92 13.11 13.29 13.33 13.4 13.26 13.55 13.59 13.45 13.51 13.67 13.68 13.61 3/31/04 13.55 1 Taxable-equivalent yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a federal income tax rate of 28%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 2 The Fund also paid shareholders capital gains and net ordinary income distributions in December 2003 of $0.0719 per share. 9 Nuveen California Select Tax-Free Income Portfolio Performance OVERVIEW As of March 31, 2004 NXC Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 66% AA 3% A 17% BBB 14% FUND SNAPSHOT - -------------------------------------------------- Share Price $14.06 - -------------------------------------------------- Common Share Net Asset Value $14.68 - -------------------------------------------------- Premium/(Discount) to NAV -4.22% - -------------------------------------------------- Market Yield 4.78% - -------------------------------------------------- Taxable-Equivalent Yield1 6.64% - -------------------------------------------------- Net Assets ($000) $91,864 - -------------------------------------------------- Average Effective Maturity (Years) 17.44 - -------------------------------------------------- Duration 6.69 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 6/19/92) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 9.14% 6.16% - -------------------------------------------------- 5-Year 3.42% 4.80% - -------------------------------------------------- 10-Year 5.83% 6.20% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Tax Obligation/General 22% - -------------------------------------------------- Transportation 15% - -------------------------------------------------- Healthcare 15% - -------------------------------------------------- Education and Civic Organizations 14% - -------------------------------------------------- Water and Sewer 11% - -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 Apr 0.057 May 0.057 Jun 0.057 Jul 0.057 Aug 0.057 Sep 0.056 Oct 0.056 Nov 0.056 Dec 0.056 Jan 0.056 Feb 0.056 Mar 0.056 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 4/1/03 13.86 13.9 13.95 13.9 14.14 14.07 14.13 14.6 14.42 14.49 14.5 14.51 14.28 13.76 13.41 13.84 13.6 13.5 13.51 13.85 13.9 13.82 13.98 13.88 13.7 13.75 13.7 13.61 13.72 13.66 13.77 13.5 13.49 13.65 13.78 13.92 13.94 13.9 14.1 14.43 14.2 14.07 14.08 14.36 14.23 3/31/04 14.29 1 Taxable-equivalent yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 34.5%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 2 The Fund also paid shareholders capital gains and net ordinary income distributions in December 2003 of $0.0540 per share. 10 Nuveen New York Select Tax-Free Income Portfolio Performance OVERVIEW As of March 31, 2004 NXN Pie Chart: CREDIT QUALITY AAA/U.S. Guaranteed 81% AA 15% BBB 4% FUND SNAPSHOT - -------------------------------------------------- Share Price $14.40 - -------------------------------------------------- Common Share Net Asset Value $14.57 - -------------------------------------------------- Premium/(Discount) to NAV -1.17% - -------------------------------------------------- Market Yield 4.67% - -------------------------------------------------- Taxable-Equivalent Yield1 6.49% - -------------------------------------------------- Net Assets ($000) $56,958 - -------------------------------------------------- Average Effective Maturity (Years) 17.61 - -------------------------------------------------- Duration 5.76 - -------------------------------------------------- AVERAGE ANNUAL TOTAL RETURN (Inception 6/19/92) - -------------------------------------------------- ON SHARE PRICE ON NAV - -------------------------------------------------- 1-Year 11.81% 5.84% - -------------------------------------------------- 5-Year 4.72% 4.97% - -------------------------------------------------- 10-Year 6.44% 6.03% - -------------------------------------------------- TOP FIVE SECTORS (as a % of total investments) - -------------------------------------------------- Tax Obligation/Limited 13% - -------------------------------------------------- Education and Civic Organizations 13% - -------------------------------------------------- Water and Sewer 12% - -------------------------------------------------- Healthcare 10% - -------------------------------------------------- Long-Term Care 9% - -------------------------------------------------- Bar Chart: 2003-2004 MONTHLY TAX-FREE DIVIDENDS PER SHARE2 Apr 0.057 May 0.057 Jun 0.057 Jul 0.057 Aug 0.057 Sep 0.057 Oct 0.057 Nov 0.057 Dec 0.057 Jan 0.057 Feb 0.057 Mar 0.056 Line Chart: SHARE PRICE PERFORMANCE Weekly Closing Price Past performance is not predictive of future results. 4/1/03 13.4 13.41 13.47 13.5 13.43 13.9 14.06 14.54 14.6 14.5 14.49 14.29 14.4 13.99 13.64 13.54 13.15 13.61 13.59 13.59 13.48 13.6 13.52 13.5 13.45 13.52 13.56 13.5 13.48 13.56 13.56 13.53 13.62 14.44 14.33 14.7 14.74 14.37 14.38 14.76 14.8 14.35 14.59 14.58 14.57 3/31/04 14.44 1 Taxable-equivalent yield represents the yield that must be earned on a fully taxable investment in order to equal the yield of the Fund on an after-tax basis. It is based on a combined federal and state income tax rate of 33.5%. For investments that generate qualified dividend income, the taxable-equivalent yield is lower. 2 The Fund also paid shareholders capital gains distributions in December 2003 of $0.0726 per share. 11 Report of INDEPENDENT AUDITORS THE BOARD OF TRUSTEES AND SHAREHOLDERS NUVEEN SELECT TAX-FREE INCOME PORTFOLIO NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 2 NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 3 NUVEEN CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO NUVEEN NEW YORK SELECT TAX-FREE INCOME PORTFOLIO We have audited the accompanying statements of assets and liabilities, including the portfolios of investments, of Nuveen Select Tax-Free Income Portfolio, Nuveen Select Tax-Free Income Portfolio 2, Nuveen Select Tax-Free Income Portfolio 3, Nuveen California Select Tax-Free Income Portfolio, and Nuveen New York Select Tax-Free Income Portfolio as of March 31, 2004, and the related statements of operations for the year then ended, the statements of changes in net assets for each of the two years in the period then ended and the financial highlights for each of the five years in the period then ended. These financial statements and financial highlights are the responsibility of the Trusts' management. Our responsibility is to express an opinion on these financial statements and financial highlights based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements and financial highlights are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and financial highlights. Our procedures included confirmation of investments owned as of March 31, 2004, by correspondence with the custodian and brokers or by other appropriate auditing procedures where replies from brokers were not received. 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 positions of Nuveen Select Tax-Free Income Portfolio, Nuveen Select Tax-Free Income Portfolio 2, Nuveen Select Tax-Free Income Portfolio 3, Nuveen California Select Tax-Free Income Portfolio, and Nuveen New York Select Tax-Free Income Portfolio at March 31, 2004, and the results of their operations for the year then ended, the changes in their 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 principles generally accepted in the United States. Ernst & Young LLP Chicago, Illinois May 14, 2004 12 Nuveen Select Tax-Free Income Portfolio (NXP) Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ ALASKA - 1.1% $ 2,475 Alaska Municipal Bond Bank Authority, General Obligation 12/13 at 100.00 AAA $ 2,668,372 Bonds, Series 2003E, 5.250%, 12/01/23 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 5.3% 3,325 California Department of Water Resources, Power Supply 5/12 at 101.00 A3 3,850,383 Revenue Bonds, Series 2002A, 6.000%, 5/01/14 3,000 California State Public Works Board, Lease Revenue 11/04 at 102.00 Aaa 3,162,210 Bonds, Department of Corrections, Soledad II State Prison, Series 1994A, 6.875%, 11/01/14 (Pre-refunded to 11/01/04) 1,450 California Statewide Community Development 8/04 at 100.00 A3 1,469,807 Authority, Hospital Revenue Certificates of Participation, Cedars-Sinai Medical Center, Series 1992, 6.500%, 8/01/15 200 Contra Costa County, California, Refunding Certificates 11/07 at 102.00 AAA 221,000 of Participation, Merrithew Memorial Hospital Replacement Project, Series 1997, 5.375%, 11/01/17 - MBIA Insured 3,000 Golden State Tobacco Securitization Corporation, 6/13 at 100.00 BBB 2,969,760 California, Tobacco Settlement Asset-Backed Bonds, Series 2003A-1, 6.750%, 6/01/39 1,130 Los Angeles Department of Water and Power, 7/11 at 100.00 AAA 1,168,533 California, Waterworks Revenue Refunding Bonds, Series 2001A, 5.125%, 7/01/41 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 13.1% 3,000 Colorado Health Facilities Authority, Revenue Bonds, 9/12 at 100.00 AA 3,174,270 Catholic Health Initiatives, Series 2002A, 5.500%, 3/01/22 1,000 Colorado Water Resources and Power Development 11/10 at 100.00 AAA 1,146,440 Authority, Small Water Resources Revenue Bonds, Series 2000A, 5.800%, 11/01/20 - FGIC Insured 5,000 Denver City and County, Colorado, Airport System 11/11 at 100.00 AAA 5,505,250 Revenue Refunding Bonds, Series 2001B, 5.625%, 11/15/17 (Alternative Minimum Tax) - FGIC Insured 10,750 Denver City and County, Colorado, Airport System No Opt. Call A 13,260,878 Revenue Bonds, Series 1991D, 7.750%, 11/15/13 (Alternative Minimum Tax) Denver Convention Center Hotel Authority, Colorado, Convention Center Hotel Senior Revenue Bonds, Series 2003A: 1,000 5.000%, 12/01/22 - XLCA Insured 12/13 at 100.00 AAA 1,053,620 3,000 5.000%, 12/01/23 - XLCA Insured 12/13 at 100.00 AAA 3,131,910 5,000 E-470 Public Highway Authority, Colorado, Senior 9/10 at 31.42 AAA 1,201,600 Revenue Bonds, Series 2000A, 0.000%, 9/01/28 - MBIA Insured 3,160 Northwest Parkway Public Highway Authority, 6/11 at 102.00 AAA 3,493,949 Colorado, Revenue Bonds, Senior Series 2001A, 5.500%, 6/15/20 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ DISTRICT OF COLUMBIA - 0.5% 1,000 District of Columbia, Hospital Revenue Refunding 8/06 at 102.00 AAA 1,108,240 Bonds, Medlantic Healthcare Group Issue, Series 1996A, 5.750%, 8/15/16 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 7.0% 250 Escambia County, Florida, Pollution Control Revenue 6/04 at 102.00 BBB 253,298 Bonds, Champion International Corporation Project, Series 1993, 5.875%, 6/01/22 (Alternative Minimum Tax) 10,000 JEA, St. John's River Power Park System, Florida, 10/11 at 100.00 AA 10,679,200 Revenue Refunding Bonds, Issue 2, Series 2002-17, 5.000%, 10/01/17 6,100 JEA, St. John's River Power Park System, Florida, No Opt. Call AA 6,115,494 Revenue Refunding Bonds, Issue 2, Series Nine, 5.250%, 10/01/21 13 Nuveen Select Tax-Free Income Portfolio (NXP) (continued) Portfolio of INVESTMENTS March 31, 2004 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ HAWAII - 0.6% $ 1,330 Hawaii, Certificates of Participation, Kapolei State 11/08 at 101.00 AAA $ 1,427,689 Office Building, Series 1998A, 5.000%, 5/01/17 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 13.2% Chicago Heights, Illinois, General Obligation Corporate Purpose Bonds, Series 1993: 3,820 5.650%, 12/01/15 - FGIC Insured 12/08 at 100.00 AAA 4,310,488 2,600 5.650%, 12/01/17 - FGIC Insured 12/08 at 100.00 AAA 2,930,200 2,500 Chicago, Illinois, Special Facility Revenue Refunding No Opt. Call N/R 775,000 Bonds, O'Hare International Airport, United Air Lines, Inc. Project, Series 2001C, 6.300%, 5/01/16# 1,000 Illinois Educational Facilities Authority, Revenue Bonds, 5/08 at 101.00 A 1,043,400 Midwestern University, Series 1998B, 5.500%, 5/15/18 - ACA Insured 1,960 Illinois Health Facilities Authority, Revenue Refunding No Opt. Call N/R*** 2,157,627 Bonds, Evangelical Hospitals Corporation, Series 1992B, 6.500%, 4/15/09 1,320 Illinois Health Facilities Authority, Revenue Bonds, 10/11 at 100.00 A 1,412,862 Decatur Memorial Hospital, Series 2001, 5.600%, 10/01/16 2,700 Illinois Health Facilities Authority, Revenue Bonds, 7/12 at 100.00 A- 3,016,764 Lake Forest Hospital, Series 2002A, 6.000%, 7/01/17 2,225 Illinois Health Facilities Authority, Revenue Refunding 1/13 at 100.00 A2 2,518,500 Bonds, Elmhurst Memorial Healthcare, Series 2002, 6.250%, 1/01/17 800 Illinois Housing Development Authority, Homeowner 2/10 at 100.00 AA 865,888 Mortgage Revenue Bonds, Series 2000D-3, 5.700%, 8/01/17 1,500 Illinois Housing Development Authority, Homeowner 7/10 at 100.00 AA 1,631,295 Mortgage Revenue Bonds, Series 1999G-1, 5.700%, 8/01/17 600 Illinois Educational Facilities Authority, Student Housing 5/12 at 101.00 Baa2 618,378 Revenue Bonds, Educational Advancement Foundation Fund, University Center Project, Series 2002, 6.000%, 5/01/22 2,000 Illinois, General Obligation Bonds, Series 1994, 8/04 at 102.00 Aa3*** 2,072,200 5.875%, 8/01/14 (Pre-refunded to 8/01/04) 3,125 Metropolitan Pier and Exposition Authority, Illinois, No Opt. Call AAA 1,725,156 McCormick Place Expansion Project Bonds, Series 1992A, 0.000%, 6/15/17 - FGIC Insured 5,000 Metropolitan Pier and Exposition Authority, Illinois, 6/12 at 101.00 AAA 5,292,700 Refunding Bonds, McCormick Place Expansion Project, Series 2002B, 5.000%, 6/15/21 - MBIA Insured Yorkville United City, Illinois, General Obligation Debt Certificates, Series 2003: 1,000 5.000%, 12/15/19 - RAAI Insured 12/11 at 100.00 AA 1,031,200 1,000 5.000%, 12/15/20 - RAAI Insured 12/11 at 100.00 AA 1,027,270 - ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 7.6% 5,000 Duneland School Building Corporation, Indiana, First 2/09 at 101.00 AAA 5,366,250 Mortgage Refunding Bonds, Series 1999, 5.125%, 2/01/18 - MBIA Insured 2,000 Indiana Health Facility Financing Authority, Hospital No Opt. Call AAA 2,529,740 Revenue Refunding Bonds, Columbus Regional Hospital, Series 1993, 7.000%, 8/15/15 - FSA Insured 9,855 Indianapolis Local Public Improvement Bond Bank, 7/12 at 100.00 AAA 10,517,749 Indiana, Waterworks Project, Series 2002A, 5.125%, 7/01/21 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ KANSAS - 1.7% 4,030 Wichita, Kansas, Revenue Bonds, CSJ Health System 5/04 at 100.00 A+*** 4,051,722 of Wichita, Inc., Series 1985-XXV, 7.200%, 10/01/15 - ------------------------------------------------------------------------------------------------------------------------------------ KENTUCKY - 1.9% 1,100 Jefferson County, Kentucky, Health System Revenue 10/08 at 101.00 AAA 1,161,336 Bonds, Alliant Health System, Inc., Series 1998, 5.125%, 10/01/18 - MBIA Insured 3,230 Lexington-Fayette Urban County Government, 11/04 at 102.00 AAA 3,401,771 Kentucky, Revenue Bonds, University of Kentucky Alumni Association Project, Series 1994, 6.750%, 11/01/15 (Pre-refunded to 11/01/04) - MBIA Insured 14 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 0.2% $ 500 Massachusetts Health and Educational Facilities 7/11 at 101.00 AA- $ 563,925 Authority, Revenue Bonds, Partners HealthCare System, Inc., Series 2001C, 6.000%, 7/01/17 - ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 1.8% 665 City of Detroit, Michigan, Water Supply System 7/05 at 102.00 AAA 696,707 Revenue Bonds, Second Lien, Series 1995A, 5.500%, 7/01/25 - MBIA Insured 2,900 Michigan State Hospital Finance Authority, Revenue 12/12 at 100.00 AA- 3,030,500 Refunding Bonds, Trinity Health Credit Group, Series 2002C, 5.375%, 12/01/30 1,000 Michigan State Hospital Finance Authority, Hospital 8/08 at 101.00 Ba3 729,510 Revenue Bonds, Detroit Medical Center Obligated Group, Series 1998A, 5.125%, 8/15/18 - ------------------------------------------------------------------------------------------------------------------------------------ MINNESOTA - 0.3% 670 Minnesota Housing Finance Agency, Single Family 7/08 at 101.00 AA+ 705,068 Mortgage Revenue Bonds, Series 1995A, 5.200%, 1/01/17 - ------------------------------------------------------------------------------------------------------------------------------------ MISSISSIPPI - 1.6% 3,600 Calhoun County, Mississippi, Solid Waste Disposal 4/07 at 103.00 BBB 3,929,292 Revenue Bonds, Weyerhauser Company Project, Series 1992, 6.875%, 4/01/16 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 6.6% 2,500 Clark County, Nevada, Motor Vehicle Fuel Tax Highway 7/13 at 100.00 AAA 2,621,525 Improvement Revenue Bonds, Series 2003, 5.000%, 7/01/23 - AMBAC Insured State Department of Business and Industry, Director of Nevada, Revenue Bonds, Las Vegas Monorail Project, First Tier Series 2000: 2,360 0.000%, 1/01/21 - AMBAC Insured No Opt. Call AAA 1,031,957 3,500 0.000%, 1/01/22 - AMBAC Insured No Opt. Call AAA 1,439,165 6,025 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 AAA 6,394,935 4,070 Reno, Nevada, Capital Improvement Revenue Bonds, 6/12 at 100.00 AAA 4,491,815 Series 2002, 5.500%, 6/01/21 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 0.4% 985 New Hampshire Housing Finance Agency, Single Family 5/11 at 100.00 Aa2 1,047,144 Mortgage Acquisition Bonds, Series 2001A, 5.600%, 7/01/21 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 1.1% 2,500 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Baa2 2,583,050 Revenue Bonds, Somerset Medical Center, Series 2003, 5.500%, 7/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 3.5% 450 Long Island Power Authority, New York, Electric 6/08 at 101.00 AAA 474,498 System General Revenue Bonds, Series 1998A, 5.125%, 12/01/22 - FSA Insured 5,170 New York City, New York, General Obligation Bonds, 8/04 at 101.50 Aaa 5,337,301 Fiscal Series 1995A, 6.250%, 8/01/10 (Pre-refunded to 8/01/04) 1,000 Dormitory Authority of the State of New York, Revenue 7/04 at 102.00 AAA 1,023,070 Bonds, Columbia University, Series 1994A, 4.750%, 7/01/14 1,600 Dormitory Authority of the State of New York, Revenue 7/10 at 101.00 Ba1 1,642,512 Bonds, Mount Sinai NYU Health Obligated Group, Series 2000A, 6.500%, 7/01/17 - ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 0.8% 1,330 North Carolina Eastern Municipal Power Agency, Power No Opt. Call BBB 1,330,652 System Revenue Refunding Bonds, Series 1993B, 5.500%, 1/01/21 500 Raleigh Durham Airport Authority, North Carolina, 5/11 at 101.00 Aaa 549,120 Airport Revenue Bonds, Series 2001A, 5.250%, 11/01/17 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 0.7% 1,575 Ohio Housing Finance Agency, GNMA Mortgage-Backed 9/07 at 102.00 Aaa 1,684,100 Securities Program, Residential Mortgage Remarketed Revenue Bonds, Series 1997A-1, 6.050%, 9/01/17 (Alternative Minimum Tax) 15 Nuveen Select Tax-Free Income Portfolio (NXP) (continued) Portfolio of INVESTMENTS March 31, 2004 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 0.2% $ 500 Pennsylvania Higher Educational Facilities Authority, 7/13 at 100.00 BBB+ $ 510,835 Revenue Bonds, Widner University, Series 2003, 5.250%, 7/15/24 - ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 7.0% 10,000 Greenville County School District, South Carolina, 12/12 at 101.00 AA- 11,232,800 Installment Purchase Revenue Bonds, Series 2002, 5.875%, 12/01/19 1,500 Lexington County Health Service District, South Carolina, 11/13 at 100.00 A 1,679,100 Hospital Revenue Refunding and Improvement Bonds, Series 2003, 6.000%, 11/01/18 2,500 South Carolina JOBS Economic Development Authority, 11/12 at 100.00 A- 2,561,575 Revenue Bonds, Bon Secours Health System, Inc., Series 2002A, 5.625%, 11/15/30 1,500 Tobacco Settlement Revenue Management Authority, 5/11 at 101.00 BBB 1,429,110 South Carolina, Tobacco Settlement Asset-Backed Bonds, Series 2001B, 6.000%, 5/15/22 - ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 9.6% 5,000 Brazos River Harbor Navigation District, Brazoria 5/12 at 101.00 A- 5,668,150 County, Texas, Environmental Facilities Revenue Bonds, Dow Chemical Company Project, Series 2002A-6, 6.250%, 5/15/33 (Alternative Minimum Tax) (Mandatory put 5/15/17) 6,150 Dallas Independent School District, Dallas County, 2/12 at 100.00 AAA 6,649,380 Texas, General Obligation Refunding Bonds, Series 2002, 5.250%, 2/15/20 4,370 Harris County Health Facilities Development 6/04 at 100.00 A3*** 4,414,093 Corporation, Texas, Hospital Revenue Bonds, Memorial Hermann Healthcare System, Series 1992, 7.125%, 6/01/15 (Pre-refunded to 6/01/04) 2,300 Harris County Health Facilities Development 11/13 at 100.00 AAA 2,369,851 Corporation, Texas, Thermal Utility Revenue Bonds, TECO Project, Series 2003, 5.000%, 11/15/30 - MBIA Insured 3,500 Irving Independent School District, Dallas County, 2/12 at 100.00 AAA 3,613,575 Texas, General Obligation Refunding Bonds, Series 2002A, 5.000%, 2/15/31 San Antonio, Texas, Water System Revenue Refunding Bonds, Series 1992: 95 6.000%, 5/15/16 (Pre-refunded to 5/15/07) - MBIA Insured 5/07 at 100.00 AAA 107,062 465 6.000%, 5/15/16 - MBIA Insured No Opt. Call AAA 550,965 - ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 9.2% 5,700 Snohomish County Public Utility District 1, Washington, 7/04 at 100.00 Aaa 6,795,996 Generation System Revenue Bonds, Series 1989, 6.750%, 1/01/12 2,000 Washington State Tobacco Settlement Authority, 6/13 at 100.00 BBB 1,976,640 Tobacco Settlement Asset-Backed Revenue Bonds, Series 2002, 6.500%, 6/01/26 3,000 Washington State Healthcare Facilities Authority, 12/07 at 101.00 AAA 3,185,520 Revenue Bonds, Catholic Health Initiatives, Series 1997A, 5.125%, 12/01/17 - MBIA Insured 9,750 Washington State Healthcare Facilities Authority, 10/11 at 100.00 AAA 10,425,383 Revenue Bonds, Sisters of Providence Health System, Series 2001A, 5.125%, 10/01/17 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ WEST VIRGINIA - 0.9% 1,885 Marshall County, West Virginia, Special Obligation No Opt. Call AAA 2,203,166 Refunding Bonds, Series 1992, 6.500%, 5/15/10 - ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 1.5% 2,500 Wisconsin, General Obligation Refunding Bonds, 11/13 at 100.00 AA- 2,605,250 Series 2003-3, 5.000%, 11/01/26 1,000 Wisconsin Health and Educational Facilities Authority, 8/13 at 100.00 A 1,086,480 Revenue Bonds, Wheaton Franciscan Services, Inc., Series 2003A, 5.500%, 8/15/17 - ------------------------------------------------------------------------------------------------------------------------------------ $ 230,150 Total Long-Term Investments (cost $221,802,927) - 97.4% 236,890,176 =============----------------------------------------------------------------------------------------------------------------------- 16 PRINCIPAL MARKET AMOUNT (000) DESCRIPTION RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ SHORT-TERM INVESTMENTS - 0.8% $ 2,000 Nebraska Educational Finance Authority, Variable Rate VMIG-1 $ 2,000,000 Demand Revenue Refunding Bonds, Creighton University, Series 2001, 1.120%, 8/01/31+ - ------------------------------------------------------------------------------------------------------------------------------------ $ 2,000 Total Short-Term Investments (cost $2,000,000) 2,000,000 =============----------------------------------------------------------------------------------------------------------------------- Total Investments (cost $223,802,927) - 98.2% 238,890,176 -------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 1.8% 4,275,002 -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $ 243,165,178 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensures the timely payment of principal and interest. Such securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. # On December 9, 2002, UALCorporation, the holding company of United Air Lines, Inc. filed for federal bankruptcy protection. The Adviser determined that it was likely United would not remain current on their interest payment obligations with respect to these bonds and thus has stopped accruing interest. + Security has a maturity of more than one year, but has variable rate and demand features which qualify it as a short-term security. The rate disclosed is that currently in effect. This rate changes periodically based on market conditions or a specified market index. See accompanying notes to financial statements. 17
Nuveen Select Tax-Free Income Portfolio 2 (NXQ) Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ ARKANSAS - 1.6% $ 1,000 Fort Smith, Arkansas, Water and Sewer Revenue Refunding 10/11 at 100.00 AAA $ 1,067,050 and Construction Bonds, Series 2002A, 5.000%, 10/01/19 - FSA Insured 1,000 Sebastian County Health Facilities Board, Arkansas, 11/11 at 101.00 Baa1 1,017,580 Hospital Revenue Improvement Bonds, Sparks Regional Medical Center, Series 2001A, 5.250%, 11/01/21 2,000 University of Arkansas, Fayetteville, Various Facilities 12/12 at 100.00 Aaa 2,079,140 Revenue Bonds, Series 2002, 5.000%, 12/01/32 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 6.2% 3,325 California Department of Water Resources, Power Supply 5/12 at 101.00 A3 3,850,383 Revenue Bonds, Series 2002A, 6.000%, 5/01/14 2,000 California State Public Works Board, Lease Revenue No Opt. Call Aa2 2,295,140 Refunding Bonds, Various University of California Projects, Series 1993A, 5.500%, 6/01/14 5,000 California State Public Works Board, Lease Revenue 11/04 at 102.00 Aaa 5,270,350 Bonds, Department of Corrections, Soledad II State Prison, Series 1994A, 6.875%, 11/01/14 (Pre-refunded to 11/01/04) 500 California State Public Works Board, Lease Revenue 12/08 at 101.00 Baa2 523,850 Refunding Bonds, Various California Community College Projects, Series 1998A, 5.250%, 12/01/16 500 Contra Costa Water District, California, Water Revenue 10/07 at 100.00 AA 538,580 Refunding Bonds, Series 1997H, 5.000%, 10/01/17 500 Contra Costa County, California, Refunding Certificates 11/07 at 102.00 AAA 552,500 of Participation, Merrithew Memorial Hospital Replacement Project, Series 1997, 5.375%, 11/01/17 - MBIA Insured 3,000 Golden State Tobacco Securitization Corporation, California, 6/13 at 100.00 BBB 2,969,760 Tobacco Settlement Asset-Backed Bonds, Series 2003A-1, 6.750%, 6/01/39 - ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 7.8% 3,000 Colorado Health Facilities Authority, Revenue Bonds, 9/12 at 100.00 AA 3,174,270 Catholic Health Initiatives, Series 2002A, 5.500%, 3/01/22 5,000 Denver City and County, Colorado, Airport System Revenue , 11/11 at 100.00 AAA 5,505,250 Refunding Bonds, Series 2001B, 5.625% 11/15/17 (Alternative Minimum Tax) - FGIC Insured 3,185 Denver City and County, Colorado, Airport System No Opt. Call A 3,928,920 Revenue Bonds, Series 1991D, 7.750%, 11/15/13 (Alternative Minimum Tax) 3,000 Denver Convention Center Hotel Authority, Colorado, 12/13 at 100.00 AAA 3,131,910 Convention Center Hotel Senior Revenue Bonds, Series 2003A, 5.000%, 12/01/23 - XLCA Insured 5,000 E-470 Public Highway Authority, Colorado, Senior Revenue No Opt. Call AAA 1,777,600 Bonds, Series 2000B, 0.000%, 9/01/24 - MBIA Insured 5,000 E-470 Public Highway Authority, Colorado, Senior Revenue 9/10 at 31.42 AAA 1,201,600 Bonds, Series 2000A, 0.000%, 9/01/28 - MBIA Insured 250 Northwest Parkway Public Highway Authority, Colorado, 6/11 at 102.00 AAA 264,278 Revenue Bonds, Senior Series 2001A, 5.250%, 6/15/41 - FSA Insured 1,100 University of Colorado Hospital Authority, Hospital 11/11 at 100.00 A3 1,138,940 Revenue Bonds, Series 2001A, 5.600%, 11/15/31 - ------------------------------------------------------------------------------------------------------------------------------------ DISTRICT OF COLUMBIA - 0.2% 500 District of Columbia, Hospital Revenue Refunding Bonds, 8/06 at 102.00 AAA 554,120 Medlantic Healthcare Group Issue, Series 1996A, 5.750%, 8/15/16 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 2.4% 6,060 JEA, St. John's River Power Park System, Florida, Revenue No Opt. Call AA 6,075,392 Refunding Bonds, Issue 2, Series Nine, 5.250%, 10/01/21 18 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ HAWAII - 0.5% $ 1,100 Hawaii, Certificates of Participation, Kapolei State Office 11/08 at 101.00 AAA $ 1,180,795 Building, Series 1998A, 5.000%, 5/01/17 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 16.7% 8,420 Chicago Metropolitan Housing Development Corporation, 7/04 at 100.00 AA 8,463,616 Illinois, FHA-Insured Section 8 Housing Development Revenue Refunding Bonds, Series 1992, 6.800%, 7/01/17 2,400 Chicago, Illinois, Special Facility Revenue Refunding No Opt. Call N/R 744,000 Bonds, O'Hare International Airport, United Air Lines, Inc. Project, Series 2001C, 6.300%, 5/01/16# 250 Illinois Development Finance Authority, Economic 8/08 at 100.00 Baa2 263,337 Development Revenue Bonds, Latin School of Chicago Project, Series 1998, 5.200%, 8/01/11 Illinois Educational Facilities Authority, Revenue Refunding Bonds, Columbia College, Series 1992: 2,610 6.875%, 12/01/17 (Pre-refunded to 12/01/04) 12/04 at 100.00 N/R*** 2,710,276 1,140 6.875%, 12/01/17 12/04 at 100.00 BBB 1,156,735 3,000 Illinois Health Facilities Authority, Revenue Bonds, 5/04 at 102.00 AAA 3,066,780 Rush-Presbyterian St. Luke's Medical Center Obligated Group, Series 1993, 5.250%, 11/15/20 - MBIA Insured 805 Illinois Health Facilities Authority, Revenue Bonds, 7/11 at 100.00 Baa1 835,638 Loyola University Health System, Series 2001A, 6.125%, 7/01/31 2,255 Illinois Health Facilities Authority, Revenue Bonds, 7/12 at 100.00 A- 2,502,125 Lake Forest Hospital, Series 2002A, 6.250%, 7/01/22 1,900 Illinois Housing Development Authority, Homeowner 2/10 at 100.00 AA 2,056,484 Mortgage Revenue Bonds, Series 2000D-3, 5.700%, 8/01/17 600 Illinois Educational Facilities Authority, Student Housing 5/12 at 101.00 Baa2 618,378 Revenue Bonds, Educational Advancement Foundation Fund, University Center Project, Series 2002, 6.000%, 5/01/22 5,700 Illinois, Sales Tax Revenue Bonds, First 6/13 at 100.00 AAA 6,015,837 Series 2002, 5.000%, 6/15/22 45 Metropolitan Pier and Exposition Authority, Illinois, 6/04 at 101.00 A1 45,988 McCormick Place Expansion Project Bonds, Series 1992A, 6.500%, 6/15/22 7,000 Metropolitan Pier and Exposition Authority, Illinois, 6/12 at 101.00 AAA 7,409,780 McCormick Place Expansion Project Refunding Bonds, Series 2002B, 5.000%, 6/15/21 - MBIA Insured 5,045 Sauk Village, Illinois, General Obligation Alternate 12/12 at 100.00 AA 5,156,797 Revenue Source Bonds, Tax Increment, Series 2002A, 5.000%, 6/01/22 - RAAI Insured Sauk Village, Illinois, General Obligation Alternate Revenue Source Bonds, Tax Increment, Series 2002B: 1,060 0.000%, 12/01/17 - RAAI Insured No Opt. Call AA 530,466 1,135 0.000%, 12/01/18 - RAAI Insured No Opt. Call AA 530,919 1,000 Yorkville United City, Illinois, General Obligation Debt 12/11 at 100.00 AA 1,024,010 Certificates, Series 2003, 5.000%, 12/15/21 - RAAI Insured - ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 2.6% 4,380 Indiana Municipal Power Agency, Power Supply System 1/12 at 100.00 AAA 4,644,464 Revenue Bonds, Series 2002A, 5.125%, 1/01/21 - AMBAC Insured 1,840 Indiana Housing Finance Authority, Single Family Mortgage 7/11 at 100.00 Aaa 1,936,048 Revenue Bonds, Series 2002C-2, 5.250%, 7/01/23 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 1.5% Iowa Tobacco Settlement Authority, Tobacco Settlement Asset-Backed Revenue Bonds, Series 2001B: 1,000 5.300%, 6/01/25 6/11 at 101.00 BBB 867,610 3,500 5.600%, 6/01/35 6/11 at 101.00 BBB 2,972,690 - ------------------------------------------------------------------------------------------------------------------------------------ LOUISIANA - 1.2% 3,000 Louisiana Public Facilities Authority, Revenue Bonds, Tulane 7/12 at 100.00 AAA 3,152,520 University, Series 2002A, 5.125%, 7/01/27 - AMBAC Insured 19 Nuveen Select Tax-Free Income Portfolio 2 (NXQ) (continued) Portfolio of INVESTMENTS March 31, 2004 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 2.2% $ 3,000 Massachusetts Health and Educational Facilities Authority, 10/11 at 101.00 BBB+ $ 3,148,620 Revenue Bonds, Berkshire Health System, Series 2001E, 6.250%, 10/01/31 2,090 Massachusetts Water Resources Authority, General No Opt. Call AAA 2,383,290 Revenue Bonds, Series 1993C, 5.250%, 12/01/15 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 2.0% 2,900 Michigan State Hospital Finance Authority, Revenue 12/12 at 100.00 AA- 3,030,500 Refunding Bonds, Trinity Health Credit Group, Series 2002C, 5.375%, 12/01/30 2,000 Plymouth-Canton Community School District, Wayne 5/09 at 100.00 AA+ 2,066,180 and Washtenaw Counties, Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 1999, 4.750%, 5/01/18 - ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 5.7% 500 Clark County, Nevada, Limited Tax General Obligation 7/06 at 101.00 AAA 542,270 Las Vegas Convention and Visitors Authority Bonds, Series 1996, 5.500%, 7/01/17 - MBIA Insured 13,250 State Department of Business and Industry, Director 1/10 at 100.00 AAA 14,063,550 of Nevada, Revenue Bonds, Las Vegas Monorail Project, First Tier, Series 2000, 5.375%, 1/01/40 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ NEW JERSEY - 1.0% 2,500 New Jersey Health Care Facilities Financing Authority, 7/13 at 100.00 Baa2 2,583,050 Revenue Bonds, Somerset Medical Center, Series 2003, 5.500%, 7/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 6.1% 2,700 Dormitory Authority of the State of New York, Revenue 7/10 at 101.00 Ba1 2,771,739 Bonds, Mount Sinai NYU Health Obligated Group, Series 2000A, 6.500%, 7/01/17 4,000 New York State Medical Care Facilities Finance Agency, 2/05 at 102.00 AAA 4,276,480 FHA-Insured Mortgage Revenue Bonds, New York and Presbyterian Hospital, Series 1994A, 6.750%, 8/15/14 (Pre-refunded to 2/15/05) - AMBAC Insured 3,000 New York Tobacco Settlement Financing Corporation, 6/11 at 100.00 AA- 3,338,040 Tobacco Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003B-1C, 5.500%, 6/01/16 4,425 Triborough Bridge and Tunnel Authority, New York, No Opt. Call AA- 5,160,037 Convention Center Bonds, Series 1990E, 7.250%, 1/01/10 - ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 2.8% 1,500 Charlotte-Mecklenburg Hospital Authority, North 1/11 at 101.00 AA 1,528,470 Carolina, Healthcare System Revenue Bonds, Carolinas Healthcare System, Series 2001A, 5.000%, 1/15/31 5,500 North Carolina Eastern Municipal Power Agency, 7/04 at 101.00 BBB 5,547,465 Power System Revenue Bonds, Series 1993D, 5.600%, 1/01/16 - ------------------------------------------------------------------------------------------------------------------------------------ OHIO - 1.2% 2,800 Cuyahoga County, Ohio, Hospital Revenue Bonds, 8/05 at 102.00 AAA 3,047,968 Meridia Health System, Series 1995, 6.250%, 8/15/14 (Pre-refunded to 8/15/05) - ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 2.2% 1,000 Dauphin County General Authority, Pennsylvania, 2/09 at 101.00 AAA 1,061,070 Health System Revenue Bonds, Pinnacle Health System Project, Series 1999, 5.125%, 8/15/17 - MBIA Insured 1,000 Philadelphia Authority for Industrial Development, 7/11 at 101.00 AAA 1,086,680 Pennsylvania, Airport Revenue Bonds, Philadelphia Airport System Project, Series 2001A, 5.500%, 7/01/17 (Alternative Minimum Tax) - FGIC Insured 3,250 Philadelphia School District, Pennsylvania, General 2/12 at 100.00 AAA 3,510,195 Obligation Bonds, Series 2002A, 5.500%, 2/01/31 - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ PUERTO RICO - 1.2% 3,000 Puerto Rico Housing Finance Authority, Capital Fund 12/13 at 100.00 AA*** 3,202,410 Program Revenue Bonds, Series 2003, 5.000%, 12/01/20 - ------------------------------------------------------------------------------------------------------------------------------------ RHODE ISLAND - 1.8% 5,000 Rhode Island Tobacco Settlement Financing Corporation, 6/12 at 100.00 BBB 4,585,550 Tobacco Settlement Asset-Backed Bonds, Series 2002A, 6.250%, 6/01/42 20 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 6.4% $ 4,000 Greenville County School District, South Carolina, 12/12 at 101.00 AA- $ 4,493,120 Installment Purchase Revenue Bonds, Series 2002, 5.875%, 12/01/19 2,500 Lexington County Health Service District, South 11/13 at 100.00 A 2,798,500 Carolina, Hospital Revenue Refunding and Improvement Bonds, Series 2003, 6.000%, 11/01/18 8,350 South Carolina Public Service Authority, Revenue Refunding 1/06 at 102.00 AAA 9,022,593 Bonds, Santee Cooper Electric System, Series 1996A, 5.750%, 1/01/22 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 15.7% 3,275 Bexar County Health Facilities Development Corporation, 8/04 at 102.00 AAA 3,411,600 Texas, Hospital Revenue Bonds, Baptist Memorial Hospital System Project, Series 1994, 6.900%, 2/15/14 (Pre-refunded to 8/15/04) - MBIA Insured 4,000 Brazos River Harbor Navigation District, Brazoria 5/12 at 101.00 A- 4,534,520 County, Texas, Environmental Facilities Revenue Bonds, Dow Chemical Company Project, Series 2002A-6, 6.250%, 5/15/33 (Alternative Minimum Tax) (Mandatory put 5/15/17) 4,540 Cleveland Housing Corporation, Texas, FHA-Insured 7/04 at 100.00 AAA 4,547,400 Section 8 Assisted Mortgage Revenue Refunding Bonds, Series 1992C, 7.375%, 7/01/24 - MBIA Insured 4,550 Harris County-Houston Sports Authority, Texas, Junior 11/31 at 53.78 AAA 560,515 Lien Revenue Bonds, Series 2001H, 0.000%, 11/15/41 - MBIA Insured 2,500 Harris County Health Facilities Development Corporation, 10/05 at 102.00 AAA 2,864,750 Texas, Hospital Revenue Bonds, Texas Children's Hospital, Series 1995, 5.500%, 10/01/16 - MBIA Insured 3,000 Harris County Health Facilities Development Corporation, 11/13 at 100.00 AAA 3,091,110 Texas, Thermal Utility Revenue Bonds, TECO Project, Series 2003, 5.000%, 11/15/30 - MBIA Insured 2,000 Houston, Texas, Airport System, Subordinate Lien 7/12 at 100.00 AAA 2,173,300 Revenue Bonds, Series 2002A, 5.625%, 7/01/20 (Alternative Minimum Tax) - FSA Insured 3,125 Katy Independent School District, Harris, Fort Bend 2/12 at 100.00 AAA 3,226,188 and Waller Counties, Texas, General Obligation Bonds, Series 2002A, 5.000%, 2/15/32 4,750 Sam Rayburn Municipal Power Agency, Texas, Power 10/12 at 100.00 AA 5,171,658 Supply System Revenue Refunding Bonds, Series 2002A, 5.500%, 10/01/17 - RAAI Insured 8,900 Texas Turnpike Authority, Dallas North Tollway System 1/06 at 102.00 AAA 9,439,340 Revenue Bonds, President George Bush Turnpike, Series 1995, 5.250%, 1/01/23 - FGIC Insured 1,250 Texas Water Development Board, Senior Lien State 1/07 at 100.00 AAA 1,344,263 Revolving Fund Revenue Bonds, Series 1996B, 5.125%, 7/15/18 - ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 0.6% 1,435 Salt Lake City and Sandy Metropolitan Water District, 7/14 at 100.00 Aaa 1,531,576 Utah, Water Revenue Bonds, Series 2004, 5.000%, 7/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ VERMONT - 2.7% 3,000 Vermont Housing Finance Agency, Multifamily Housing 2/09 at 100.00 AAA 3,187,740 Bonds, Series 1999C, 5.800%, 8/15/16 - FSA Insured 3,600 Vermont Industrial Development Authority, Industrial 9/04 at 100.00 A 3,636,936 Development Revenue Refunding Bonds, Stanley Works, Inc. Project, Series 1992, 6.750%, 9/01/10 - ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 3.6% 2,000 Washington State Healthcare Facilities Authority, 12/07 at 101.00 AAA 2,123,680 Revenue Bonds, Catholic Health Initiatives, Series 1997A, 5.125%, 12/01/17 - MBIA Insured 6,715 Washington State Healthcare Facilities Authority, 10/11 at 100.00 AAA 7,180,148 Revenue Bonds, Sisters of Providence Health System, Series 2001A, 5.125%, 10/01/17 - MBIA Insured 21 Nuveen Select Tax-Free Income Portfolio 2 (NXQ) (continued) Portfolio of INVESTMENTS March 31, 2004 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 2.1% $ 4,000 Wisconsin Housing and Economic Development Authority, 3/12 at 100.00 AA $ 4,208,960 Home Ownership Revenue Bonds, Series 2002G, 4.850%, 9/01/17 1,000 Wisconsin Health and Educational Facilities Authority, 8/13 at 100.00 A 1,082,480 Revenue Bonds, Wheaton Franciscan Services, Inc., Series 2003A, 5.500%, 8/15/18 - ------------------------------------------------------------------------------------------------------------------------------------ $ 252,010 Total Long-Term Investments (cost $240,927,177) - 98.0% 251,365,847 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 2.0% 5,006,774 -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $ 256,372,621 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensures the timely payment of principal and interest. Such securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. # On December 9, 2002, UALCorporation, the holding company of United Air Lines, Inc. filed for federal bankruptcy protection. The Adviser determined that it was likely United would not remain current on their interest payment obligations with respect to these bonds and thus has stopped accruing interest. See accompanying notes to financial statements. 22
Nuveen Select Tax-Free Income Portfolio 3 (NXR) Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ ALABAMA - 0.3% $ 500 Marshall County Healthcare Authority, Alabama, Revenue 1/12 at 101.00 A- $ 550,050 Bonds, Series 2002A, 6.250%, 1/01/22 - ------------------------------------------------------------------------------------------------------------------------------------ CALIFORNIA - 6.6% 2,105 Azusa Unified School District, Los Angeles County, 7/12 at 100.00 AAA 2,311,985 California, General Obligation Bonds, Series 2002, 5.375%, 7/01/21 - FSA Insured 3,350 California Department of Water Resources, Power 5/12 at 101.00 A3 3,879,334 Supply Revenue Bonds, Series 2002A, 6.000%, 5/01/14 3,000 California State Public Works Board, Lease Revenue 11/04 at 102.00 Aaa 3,162,210 Bonds, Department of Corrections, Soledad II State Prison, Series 1994A, 6.875%, 11/01/14 (Pre-refunded to 11/01/04) 3,000 Golden State Tobacco Securitization Corporation, 6/13 at 100.00 BBB 2,969,760 California, Tobacco Settlement Asset-Backed Bonds, Series 2003A-1, 6.750%, 6/01/39 - ------------------------------------------------------------------------------------------------------------------------------------ COLORADO - 5.7% 4,000 Colorado Health Facilities Authority, Revenue Bonds, 9/12 at 100.00 AA 4,232,360 Catholic Health Initiatives, Series 2002A, 5.500%, 3/01/22 2,700 Denver City and County, Colorado, Airport System No Opt. Call A 3,330,639 Revenue Bonds, Series 1991D, 7.750%, 11/15/13 (Alternative Minimum Tax) 3,000 Denver Convention Center Hotel Authority, Colorado, 12/13 at 100.00 AAA 3,136,710 Convention Center Hotel Senior Revenue Bonds, Series 2003A, 5.000%, 12/01/24 - XLCA Insured - ------------------------------------------------------------------------------------------------------------------------------------ CONNECTICUT - 0.1% 250 Connecticut Health and Educational Facilities Authority, 7/04 at 100.00 AAA 253,163 Revenue Bonds, Bridgeport Hospital Issue, Series 1992A, 6.625%, 7/01/18 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ DISTRICT OF COLUMBIA - 0.9% 235 District of Columbia, General Obligation Refunding No Opt. Call AAA 282,519 Bonds, Series 1994A-1, 6.500%, 6/01/10 - MBIA Insured 1,305 District of Columbia, General Obligation Bonds, 6/04 at 101.00 AAA 1,328,412 Series 1993E, 6.000%, 6/01/13 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ FLORIDA - 5.0% 4,000 JEA, Florida, Subordinate Lien Electric System Revenue 10/07 at 100.00 AA- 4,011,520 Bonds, Series 2002D, 4.625%, 10/01/22 5,020 JEA, St. John's River Power Park System, Florida, 10/11 at 100.00 AA 5,330,838 Revenue Refunding Bonds, Series 2002-17, Issue 2, 5.000%, 10/01/18 - ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS - 21.7% 3,000 Bryant, Illinois, Pollution Control Revenue Refunding 8/04 at 100.00 A2 3,002,610 Bonds, Central Illinois Light Company Project, Series 1992, 6.500%, 2/01/18 2,435 Chicago Metropolitan Housing Development Corporation, 7/04 at 100.00 AA 2,519,008 Illinois, FHA-Insured Section 8 Housing Development Revenue Refunding Bonds, Series 1992, 6.850%, 7/01/22 2,550 Chicago, Illinois, FHA-Insured Mortgage Revenue 6/04 at 100.00 AAA 2,557,676 Bonds, Lakeview Towers Project, Series 1992, 6.600%, 12/01/20 700 Chicago, Illinois, Special Facility Revenue Refunding No Opt. Call N/R 217,000 Bonds, O'Hare International Airport, United Air Lines, Inc. Project, Series 2001C, 6.300%, 5/01/16# 1,930 Illinois Development Finance Authority, Revenue Bonds, 5/11 at 101.00 BBB+ 2,080,386 Midwestern University, Series 2001B, 5.750%, 5/15/16 1,500 Illinois Health Facilities Authority, Revenue Bonds, No Opt. Call N/R*** 1,814,595 Evangelical Hospitals Corporation, Series 1992C, 6.250%, 4/15/22 4,000 Illinois Health Facilities Authority, Revenue Bonds, 9/06 at 100.00 AAA 4,473,640 Franciscan Sisters Healthcare Corporation Project, Series 1992B, 6.625%, 9/01/13 (Pre-refunded to 9/01/06) - MBIA Insured 23 Nuveen Select Tax-Free Income Portfolio 3 (NXR) (continued) Portfolio of INVESTMENTS March 31, 2004 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ ILLINOIS (continued) $ 4,470 Illinois Health Facilities Authority, Remarketed Revenue 8/11 at 103.00 Aa1 $ 4,954,682 Bonds, University of Chicago Project, Series 1985A, 5.500%, 8/01/20 2,225 Illinois Health Facilities Authority, Revenue Refunding 1/13 at 100.00 A2 2,518,500 Bonds, Elmhurst Memorial Healthcare, Series 2002, 6.250%, 1/01/17 620 Illinois Housing Development Authority, Homeowner 2/10 at 100.00 AA 671,063 Mortgage Revenue Bonds, Series 2000D-3, 5.700%, 8/01/17 5,700 Illinois, Sales Tax Revenue Bonds, First 6/13 at 100.00 AAA 6,015,837 Series 2002, 5.000%, 6/15/22 2,000 Illinois, Sales Tax Revenue Bonds, Series 1997X, 6/07 at 101.00 AAA 2,212,280 5.600%, 6/15/17 6,000 Metropolitan Pier and Exposition Authority, Illinois, 6/12 at 101.00 AAA 6,351,240 Refunding Bonds, McCormick Place Expansion Project, Series 2002B, 5.000%, 6/15/21 - MBIA Insured 1,000 Yorkville United City, Illinois, General Obligation Debt 12/11 at 100.00 AA 1,020,110 Certificates, Series 2003, 5.000%, 12/15/22 - RAAI Insured - ------------------------------------------------------------------------------------------------------------------------------------ INDIANA - 4.6% 3,500 Indiana Health Facility Financing Authority, Hospital 9/11 at 100.00 A+ 3,612,630 Revenue Bonds, Methodist Hospital, Inc., Series 2001, 5.375%, 9/15/22 2,000 Indianapolis Local Public Improvement Bond Bank, 7/12 at 100.00 AAA 2,111,460 Indiana, Waterworks Project, Series 2002A, 5.250%, 7/01/33 - MBIA Insured 2,725 Warrick County, Indiana, Adjustable Rate Environmental 5/04 at 101.00 A- 2,768,055 Improvement Revenue Bonds, Southern Indiana Gas and Electric Company Project, Series 1993B, 6.000%, 5/01/23 (Alternative Minimum Tax) - ------------------------------------------------------------------------------------------------------------------------------------ IOWA - 2.9% Iowa Tobacco Settlement Authority, Tobacco Settlement Asset-Backed Revenue Bonds, Series 2001B: 3,500 5.300%, 6/01/25 6/11 at 101.00 BBB 3,036,635 2,850 5.600%, 6/01/35 6/11 at 101.00 BBB 2,420,619 - ------------------------------------------------------------------------------------------------------------------------------------ MASSACHUSETTS - 0.3% 500 Massachusetts Health and Educational Facilities 7/11 at 101.00 AA- 563,925 Authority, Revenue Bonds, Partners HealthCare System, Inc., Series 2001C, 6.000%, 7/01/17 - ------------------------------------------------------------------------------------------------------------------------------------ MICHIGAN - 9.4% 4,000 Michigan Housing Development Authority, Single 6/06 at 102.00 AA+ 4,212,680 Family Mortgage Revenue Bonds, Series 1996C, 5.950%, 12/01/17 235 Michigan State Hospital Finance Authority, Revenue 8/04 at 101.00 Ba3 196,389 Refunding Bonds, Detroit Medical Center Obligated Group, Series 1993A, 6.500%, 8/15/18 2,900 Michigan State Hospital Finance Authority, Revenue 12/12 at 100.00 AA- 3,030,500 Refunding Bonds, Trinity Health Credit Group, Series 2002C, 5.375%, 12/01/30 8,240 Michigan Housing Development Authority, Limited 9/04 at 101.00 AAA 8,396,890 Obligation Multifamily Housing Revenue Bonds, Greenwood Villa Project, Series 1992, 6.625%, 9/15/17 - FSA Insured 1,600 Plymouth-Canton Community School District, Wayne 5/09 at 100.00 AA+ 1,652,944 and Washtenaw Counties, Michigan, Unlimited Tax General Obligation School Building and Site Bonds, Series 1999, 4.750%, 5/01/18 - ------------------------------------------------------------------------------------------------------------------------------------ NEBRASKA - 2.0% 3,500 Nebraska Public Power District, General Revenue 1/13 at 100.00 AAA 3,639,300 Bonds, Series 2002B, 5.000%, 1/01/33 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ NEVADA - 4.9% 4,000 State Department of Business and Industry, Director 1/10 at 100.00 AAA 4,245,600 of Nevada, Revenue Bonds, Las Vegas Monorail Project, First Tier, Series 2000, 5.375%, 1/01/40 - AMBAC Insured 4,510 Reno, Nevada, Capital Improvement Revenue Bonds, 6/12 at 100.00 AAA 4,953,694 Series 2002, 5.500%, 6/01/22 - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ NEW HAMPSHIRE - 0.7% 1,205 New Hampshire Housing Finance Agency, Single Family 5/11 at 100.00 Aa2 1,281,023 Mortgage Acquisition Bonds, Series 2001A, 5.600%, 7/01/21 (Alternative Minimum Tax) 24 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ NEW YORK - 3.5% $ 2,335 Long Island Power Authority, New York, Electric System 9/11 at 100.00 A- $ 2,461,791 General Revenue Bonds, Series 2001A, 5.375%, 9/01/21 35 New York City, New York, General Obligation Bonds, 4/04 at 100.00 A 35,143 Series 1991B, 7.000%, 2/01/18 2,130 Dormitory Authority of the State of New York, Second No Opt. Call A3 2,518,192 General Resolution Consolidated Revenue Bonds, City University System, Series 1990C, 7.500%, 7/01/10 1,475 New York State Medical Care Facilities Finance Agency, 8/04 at 100.00 AAA 1,503,571 FHA-Insured Mortgage Program Revenue Bonds, Mount Sinai NYU Health Obligated Group, Series 1992C, 6.250%, 8/15/12 (Pre-refunded to 8/15/04) - ------------------------------------------------------------------------------------------------------------------------------------ NORTH CAROLINA - 4.3% 5,000 North Carolina Municipal Power Agency 1, Catawba 1/13 at 100.00 AAA 5,494,100 Electric Revenue Bonds, Series 2003A, 5.250%, 1/01/18 - MBIA Insured 2,345 Piedmont Triad Airport Authority, North Carolina, Airport 7/11 at 101.00 AAA 2,574,083 Revenue Bonds, Series 2001A, 5.250%, 7/01/16 - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ PENNSYLVANIA - 2.5% 2,435 Dauphin County Industrial Development Authority, No Opt. Call A- 3,039,221 Pennsylvania, Water Development Revenue Refunding Bonds, Dauphin Consolidated Water Supply Company, Series 1992B, 6.700%, 6/01/17 500 Pennsylvania Higher Educational Facilities Authority, 7/13 at 100.00 BBB+ 510,835 Revenue Bonds, Widner University, Series 2003, 5.250%, 7/15/24 1,000 Philadelphia Authority for Industrial Development, 7/11 at 101.00 AAA 1,086,680 Pennsylvania, Airport Revenue Bonds, Philadelphia Airport System Project, Series 2001A, 5.500%, 7/01/17 (Alternative Minimum Tax) - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ SOUTH CAROLINA - 2.3% 1,500 Lexington County Health Service District, 11/13 at 100.00 A 1,679,100 South Carolina, Hospital Revenue Refunding and Improvement Bonds, Series 2003, 6.000%, 11/01/18 2,500 South Carolina JOBS Economic Development Authority, 11/12 at 100.00 A- 2,561,575 Revenue Bonds, Bon Secours Health System, Inc., Series 2002A, 5.625%, 11/15/30 - ------------------------------------------------------------------------------------------------------------------------------------ TENNESSEE - 1.1% 2,000 Knox County Health, Educational and Housing Facilities 4/12 at 101.00 Baa2 2,093,560 Board, Tennessee, Hospital Facilities Revenue Bonds, Baptist Health System of East Tennessee, Inc., Series 2002, 6.375%, 4/15/22 - ------------------------------------------------------------------------------------------------------------------------------------ TEXAS - 13.9% 3,755 Grand Prairie Industrial Development Authority, 6/04 at 101.00 A- 3,807,044 Texas, Industrial Development Revenue Refunding Bonds, Baxter International, Inc. Project, Series 1992, 6.550%, 12/01/12 2,500 Harris County Health Facilities Development 10/04 at 101.00 AAA 2,591,675 Corporation, Texas, Hospital Revenue Bonds, Memorial Hermann Healthcare System, Series 1994, 6.375%, 10/01/17 (Pre-refunded to 10/01/04) - MBIA Insured 2,500 Harris County Health Facilities Development Corporation, 11/13 at 100.00 AAA 2,575,925 Texas, Thermal Utility Revenue Bonds, TECO Project, Series 2003, 5.000%, 11/15/30 - MBIA Insured 3,000 Houston, Texas, Airport System, Subordinate Lien 7/12 at 100.00 AAA 3,357,660 Revenue Bonds, Series 2002B, 5.500%, 7/01/18 3,125 Katy Independent School District, Harris, Fort Bend 2/12 at 100.00 AAA 3,226,188 and Waller Counties, Texas, General Obligation Bonds, Series 2002A, 5.000%, 2/15/32 5,000 North Central Texas Health Facilities Development 5/06 at 102.00 AA- 5,182,200 Corporation, Hospital Revenue Refunding Bonds, Baylor Healthcare System, Series 1995, 5.250%, 5/15/16 4,750 Sam Rayburn Municipal Power Agency, Texas, 10/12 at 100.00 AA 5,171,658 Power Supply System Revenue Refunding Bonds, Series 2002A, 5.500%, 10/01/17 - RAAI Insured - ------------------------------------------------------------------------------------------------------------------------------------ UTAH - 0.9% 1,710 Intermountain Power Agency, Utah, Power Supply 7/06 at 102.00 A+ 1,753,588 Revenue Refunding Bonds, Series 1996D, 5.000%, 7/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ WASHINGTON - 2.1% 3,880 Washington, General Obligation Bonds, No Opt. Call Aa1 3,880,850 Series 1993A, 4.500%, 10/01/18 25 Nuveen Select Tax-Free Income Portfolio 3 (NXR) (continued) Portfolio of INVESTMENTS March 31, 2004 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ WEST VIRGINIA - 1.4% $ 2,500 Berkeley County Building Commission, West Virginia, 5/04 at 101.00 BBB- $ 2,521,500 Hospital Revenue Bonds, City Hospital Project, Series 1992, 6.500%, 11/01/09 - ------------------------------------------------------------------------------------------------------------------------------------ WISCONSIN - 1.4% 2,500 Wisconsin, General Obligation Refunding Bonds, 11/13 at 100.00 AA- 2,605,250 Series 2003-3, 5.000%, 11/01/26 - ------------------------------------------------------------------------------------------------------------------------------------ $ 174,335 Total Long-Term Investments (cost $175,565,783) - 98.5% 183,541,860 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 1.5% 2,816,184 -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $ 186,358,044 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. *** Securities are backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities which ensures the timely payment of principal and interest. Such securities are normally considered to be equivalent to AAA rated securities. N/R Investment is not rated. # On December 9, 2002, UALCorporation, the holding company of United Air Lines, Inc. filed for federal bankruptcy protection. The Adviser determined that it was likely United would not remain current on their interest payment obligations with respect to these bonds and thus has stopped accruing interest. See accompanying notes to financial statements. 26
Nuveen California Select Tax-Free Income Portfolio (NXC) Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 2.1% $ 2,000 California County Tobacco Securitization Agency, 6/12 at 100.00 BBB $ 1,914,860 Tobacco Settlement Asset-Backed Revenue Bonds, Fresno County Tobacco Funding Corporation, Series 2002, 5.625%, 6/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 14.0% 1,000 California Educational Facilities Authority, Revenue 12/09 at 101.00 AAA 1,045,500 Bonds, Stanford University, Series 1999P, 5.000%, 12/01/23 750 California Educational Facilities Authority, Revenue 8/09 at 100.00 A1 790,943 Bonds, Pepperdine University, Series 2002A, 5.500%, 8/01/32 2,600 California Educational Facilities Authority, Revenue 11/11 at 100.00 A2 2,762,630 Bonds, University of the Pacific, Series 2002, 5.250%, 11/01/21 1,000 California Educational Facilities Authority, Revenue 10/12 at 100.00 A2 1,069,110 Bonds, University of San Diego, Series 2002A, 5.500%, 10/01/32 3,000 California Infrastructure Economic Development Bank, 10/11 at 101.00 A- 3,265,620 Revenue Bonds, J. David Gladstone Institutes Project, Series 2001, 5.500%, 10/01/19 2,000 California State Public Works Board, Lease Revenue 10/12 at 100.00 AAA 2,099,520 Bonds, University of California System, Series 2002A, 5.000%, 10/01/22 750 California Statewide Community Development 8/12 at 100.00 A 790,658 Authority, Student Housing Revenue Bonds, EAH - Irvine East Campus Apartments, LLC Project, Series 2002A, 5.500%, 8/01/22 - ACA Insured 1,000 Long Beach Bond Financing Authority, California, 11/11 at 101.00 AAA 1,059,080 Lease Revenue Refunding Bonds, Long Beach Aquarium of the South Pacific, Series 2001, 5.250%, 11/01/30 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 14.6% 2,500 California Health Facilities Financing Authority, Insured 4/04 at 101.00 AAA 2,557,800 Hospital Revenue Bonds, Scripps Memorial Hospital, Series 1992A, 6.400%, 10/01/12 - MBIA Insured 2,000 California Infrastructure Economic Development Bank, 8/11 at 102.00 A 2,090,360 Revenue Bonds, Kaiser Hospital Assistance LLC, Series 2001A, 5.550%, 8/01/31 1,880 California Statewide Community Development 6/07 at 101.00 AAA 2,067,267 Authority, Revenue Bonds, Los Angeles Orthopaedic Hospital Foundation, Series 2000, 5.500%, 6/01/17 - AMBAC Insured 1,500 California Statewide Community Development 11/09 at 102.00 BBB 1,535,550 Authority, Insured Mortgage Hospital Revenue Bonds, Mission Community Hospital, Series 2001, 5.375%, 11/01/26 4,000 California Statewide Community Development 6/13 at 100.00 AAA 4,394,840 Authority, Hospital Revenue Bonds, Monterey Peninsula Hospital, Series 2003B, 5.250%, 6/01/18 - FSA Insured 790 Central California Joint Powers Health Financing 8/04 at 100.00 Baa2 777,170 Authority, Certificates of Participation, Community Hospitals of Central California, Series 1993, 5.000%, 2/01/23 - ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 1.7% 1,500 ABAG Finance Authority for Non-Profit Corporations, 11/12 at 100.00 BBB 1,532,625 California, Insured Senior Living Revenue Bonds, Odd Fellows Home of California, Series 2003A, 5.200%, 11/15/22 - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 21.4% 2,000 Antelope Valley Union High School District, Los Angeles 8/12 at 101.00 AAA 2,088,580 County, California, General Obligation Bonds, Series 2002A, 5.000%, 2/01/27 - MBIA Insured 1,500 Beverly Hills Unified School District, Los Angeles 8/12 at 100.00 AA 1,560,540 County, California, General Obligation Bonds, Series 2002A, 5.000%, 8/01/26 California, General Obligation Bonds, Series 2003: 500 5.250%, 11/01/19 - RAAI Insured 11/13 at 100.00 AA 531,915 1,450 5.250%, 2/01/21 8/13 at 100.00 Baa1 1,516,845 27 Nuveen California Select Tax-Free Income Portfolio (NXC) (continued) Portfolio of INVESTMENTS March 31, 2004 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL (continued) $ 750 California, General Obligation Bonds, Series 2004, 2/14 at 100.00 Baa1 $ 760,718 5.000%, 2/01/23 2,000 Fremont Unified School District, Alameda County, 8/12 at 101.00 AAA 2,140,720 California, General Obligation Bonds, Series 2002A, 5.000%, 8/01/21 - FGIC Insured Golden West Schools Financing Authority, California, Revenue Bonds, School District General Obligation Refunding Program, Series 1999A: 4,650 0.000%, 8/01/16 - MBIA Insured No Opt. Call AAA 2,687,514 1,750 0.000%, 2/01/17 - MBIA Insured No Opt. Call AAA 976,868 2,375 0.000%, 8/01/17 - MBIA Insured No Opt. Call AAA 1,295,966 2,345 0.000%, 2/01/18 - MBIA Insured No Opt. Call AAA 1,232,391 Mountain View-Los Altos Union High School District, Santa Clara County, California, General Obligation Capital Appreciation Bonds, Series 1995C: 1,015 0.000%, 5/01/17 - MBIA Insured No Opt. Call AAA 561,620 1,080 0.000%, 5/01/18 - MBIA Insured No Opt. Call AAA 562,572 2,000 North Orange County Community College District, 8/12 at 101.00 AAA 2,124,760 California, General Obligation Bonds, Series 2002A, 5.000%, 8/01/22 - MBIA Insured 1,500 San Diego Unified School District, San Diego County, 7/13 at 101.00 AAA 1,632,825 California, General Obligation Bonds, Series 2003E, 5.250%, 7/01/24 - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 9.4% 1,000 Bell Community Redevelopment Agency, California, 10/13 at 100.00 AA 1,070,620 Tax Allocation Bonds, Bell Project Area, Series 2003, 5.625%, 10/01/33 - RAAI Insured 3,500 California State Public Works Board, Lease Revenue No Opt. Call AAA 4,370,415 Bonds, Department of Corrections, Calipatria State Prison, Series 1991A, 6.500%, 9/01/17 - MBIA Insured 1,400 Golden State Tobacco Securitization Corporation, 6/13 at 100.00 Baa2 1,425,606 California, Enhanced Tobacco Settlement Asset-Backed Bonds, Series 2003B, 5.500%, 6/01/33 605 Sacramento City Financing Authority, California, Lease No Opt. Call AAA 695,938 Revenue Refunding Bonds, Series 1993A, 5.400%, 11/01/20 - MBIA Insured 1,000 Santa Clara County Board of Education, California, 4/12 at 101.00 AAA 1,043,820 Certificates of Participation, Series 2002, 5.000%, 4/01/25 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 15.1% 1,150 Foothill-Eastern Transportation Corridor Agency, 1/10 at 100.00 BBB- 1,072,318 California, Toll Road Revenue Bonds, Series 1995A, 5.000%, 1/01/35 5,000 Los Angeles Harbors Department, California, Revenue 8/11 at 100.00 AAA 5,414,500 Refunding Bonds, Series 2001B, 5.500%, 8/01/17 (Alternative Minimum Tax) - AMBAC Insured 3,675 Palm Springs Financing Authority, California, 7/04 at 100.00 AAA 3,687,458 Palm Springs Regional Airport Revenue Bonds, Series 1992, 6.000%, 1/01/12 (Alternative Minimum Tax) - MBIA Insured 1,000 Port of Oakland, California, Revenue Bonds, 11/12 at 100.00 AAA 1,088,130 Series 2002M, 5.250%, 11/01/20 - FGIC Insured 2,500 Port of Oakland, California, Revenue Bonds, 11/12 at 100.00 AAA 2,585,400 Series 2002N, 5.000%, 11/01/22 (Alternative Minimum Tax) - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 9.4% California Department of Water Resources, Power Supply Revenue Bonds, Series 2002A: 2,000 5.750%, 5/01/17 5/12 at 101.00 A3 2,238,700 2,000 5.125%, 5/01/19 5/12 at 101.00 A3 2,105,240 200 Los Angeles Department of Water and Power, California, 7/13 at 100.00 AAA 213,016 Power System Revenue Bonds, Series 2003A-2, 5.000%, 7/01/21 - MBIA Insured 2,550 M-S-R Public Power Agency, California, San Juan 7/04 at 100.00 AAA 2,627,520 Project Revenue Bonds, Series 1991E, 6.000%, 7/01/22 - MBIA Insured 1,225 Turlock Irrigation District, California, Revenue Refunding No Opt. Call AAA 1,458,828 Bonds, Series 1992A, 6.250%, 1/01/12 - MBIA Insured 28 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 11.0% $ 2,160 California Statewide Communities Development 10/11 at 101.00 AAA $ 2,311,956 Authority, Water and Wastewater Revenue Bonds, Pooled Financing Program, Cities of Calistoga, Pacific Grove, Pacifica and the United Water Conservation District, Series 2001B, 5.125%, 10/01/22 - FSA Insured 3,000 Contra Costa Water District, Contra Costa County, 10/04 at 102.00 AAA 3,048,930 California, Water Revenue Bonds, Series 2001G, 5.000%, 10/01/24 - MBIA Insured 2,800 Los Angeles, California, Wastewater System Revenue 6/08 at 101.00 AAA 2,901,136 Bonds, Series 1998A, 5.000%, 6/01/23 - FGIC Insured 825 South Feather Water and Power Agency, California, 4/13 at 100.00 BBB 810,131 Water Revenue Certificates of Participation, Solar Photovoltaic Project, Series 2003, 5.375%, 4/01/24 1,000 Woodbridge Irrigation District, California, Certificates 7/13 at 100.00 BBB+ 1,033,770 of Participation, Water Systems Project, Series 2003, 5.625%, 7/01/43 - ------------------------------------------------------------------------------------------------------------------------------------ $ 91,775 Total Long-Term Investments (cost $86,129,077) - 98.7% 90,630,799 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 1.3% 1,233,298 -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $ 91,864,097 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. See accompanying notes to financial statements. 29
Nuveen New York Select Tax-Free Income Portfolio (NXN) Portfolio of INVESTMENTS March 31, 2004
PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ CONSUMER STAPLES - 2.1% $ 1,235 TSASC, Inc., New York, Tobacco Asset-Backed Bonds, 7/12 at 100.00 BBB $ 1,207,435 Series 2002-1, 5.500%, 7/15/24 - ------------------------------------------------------------------------------------------------------------------------------------ EDUCATION AND CIVIC ORGANIZATIONS - 13.0% 1,700 Amherst Industrial Development Agency, New York, 8/12 at 101.00 AAA 1,802,000 Revenue Bonds, UBF Faculty/Student Housing Corporation, University of Buffalo Creekside Project, Series 2002A, 5.000%, 8/01/22 - AMBAC Insured 1,000 New York City Industrial Development Agency, 11/04 at 102.00 AAA 1,049,960 New York, Civic Facility Revenue Bonds, USTA National Tennis Center Incorporated Project, Series 1994, 6.375%, 11/15/14 - FSA Insured 570 Dormitory Authority of the State of New York, Second No Opt. Call AAA 680,039 General Resolution Consolidated Revenue Bonds, City University System, Series 1990C, 7.500%, 7/01/10 - FGIC Insured 1,425 Dormitory Authority of the State of New York, Insured 7/07 at 101.00 AAA 1,530,208 Revenue Bonds, Rochester Institute of Technology, Series 1997, 5.250%, 7/01/22 - MBIA Insured 1,430 Dormitory Authority of the State of New York, Revenue 7/11 at 101.00 AA- 1,481,866 Bonds, Upstate Community Colleges, Series 2002A, 5.000%, 7/01/23 785 Dormitory Authority of the State of New York, Insured 7/12 at 100.00 AAA 824,721 Revenue Bonds, Iona College, Series 2002, 5.000%, 7/01/22 - XLCA Insured - ------------------------------------------------------------------------------------------------------------------------------------ HEALTHCARE - 10.0% 750 New York City Health and Hospitals Corporation, 2/13 at 100.00 AAA 812,123 New York, Health System Revenue Bonds, Series 2003A, 5.250%, 2/15/21 - AMBAC Insured 250 New York City Industrial Development Agency, New York, 7/12 at 101.00 Baa3 259,383 Civic Facility Revenue Bonds, Staten Island University Hospital Project, Series 2002C, 6.450%, 7/01/32 500 Dormitory Authority of the State of New York, Revenue 7/13 at 100.00 Baa1 521,680 Bonds, Winthrop-South Nassau University Hospital Association, Series 2003A, 5.500%, 7/01/32 670 Dormitory Authority of the State of New York, Revenue 7/13 at 100.00 AAA 710,428 Bonds, Memorial Sloan Kettering Cancer Center, Series 2003-1, 5.000%, 7/01/21 - MBIA Insured 250 Dormitory Authority of the State of New York, Revenue 5/13 at 100.00 A3 261,690 Bonds, North Shore Long Island Jewish Group, Series 2003, 5.375%, 5/01/23 1,680 Dormitory Authority of the State of New York, Revenue 7/11 at 101.00 AAA 1,837,416 Bonds, Winthrop-South Nassau University Health System Obligated Group, Series 2001A, 5.250%, 7/01/17 - AMBAC Insured 1,195 Dormitory Authority of the State of New York, Revenue 7/11 at 101.00 AAA 1,306,972 Bonds, Winthrop-South Nassau University Health System Obligated Group, Series 2001B, 5.250%, 7/01/17 - AMBAC Insured - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/MULTIFAMILY - 8.2% 1,000 East Rochester Housing Authority, New York, Revenue 12/12 at 103.00 AAA 1,072,820 Bonds, GNMA/FHA Secured Revenue Bonds, St. Mary's Residence Project, Series 2002A, 5.375%, 12/20/22 1,285 New Hartford Housing Development Corporation, 7/04 at 100.00 AAA 1,287,352 New York, FHA-Insured Section 8 Mortgage Revenue Refunding Bonds, Village Point Apartments Project, Series 1992A, 7.375%, 1/01/24 - MBIA Insured 1,000 New Hartford-Sunset Woods Funding Corporation, 8/12 at 101.00 AAA 1,074,380 New York, FHA-Insured Mortgage Revenue Bonds, Sunset Woods Apartments II Project, Series 2002, 5.350%, 2/01/20 1,225 New York State Housing Finance Agency, FHA-Insured 8/04 at 100.00 AAA 1,234,923 Mortgage Multifamily Housing Revenue Bonds, Series 1992C, 6.450%, 8/15/14 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ HOUSING/SINGLE FAMILY - 8.2% 2,500 New York State Mortgage Agency, Mortgage Revenue 4/11 at 100.00 Aaa 2,578,675 Bonds, Thirty First Series A, 5.300%, 10/01/31 (Alternative Minimum Tax) 2,000 New York State Mortgage Agency, Homeowner 10/11 at 100.00 Aa1 2,117,860 Mortgage Revenue Bonds, Series 101, 5.000%, 10/01/18 (Alternative Minimum Tax) 30 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ LONG-TERM CARE - 9.2% $ 2,000 East Rochester Housing Authority, New York, 8/12 at 101.00 AAA $ 2,095,900 FHA-Insured Mortgage Revenue Refunding Bonds, Jewish Home of Rochester, Series 2002, 4.625%, 2/15/17 1,000 New York City Industrial Development Agency, 11/12 at 101.00 AA+ 1,021,940 New York, GNMA Collateralized Mortgage Revenue Bonds, Eger Harbor House, Inc. Project, Series 2002A, 4.950%, 11/20/32 2,000 Dormitory Authority of the State of New York, 8/11 at 101.00 AAA 2,103,100 FHA-Insured Mortgage Nursing Home Revenue Bonds, Norwegian Christian Home and Health Center, Series 2001, 5.200%, 8/01/36 - MBIA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/GENERAL - 6.5% Clarkstown, Rickland County, New York, Various Purpose Serial Bonds, Series 1992: 505 5.600%, 6/15/10 - AMBAC Insured No Opt. Call AAA 585,790 525 5.600%, 6/15/11 - AMBAC Insured No Opt. Call AAA 611,987 525 5.600%, 6/15/12 - AMBAC Insured No Opt. Call AAA 617,426 750 New York City, New York, General Obligation Bonds, 8/14 at 100.00 AAA 817,905 Fiscal Series 2004I, 5.000%, 8/01/17 (WI, settling 4/01/04) - MBIA Insured 1,000 West Islip Union Free School District, Suffolk County, 10/10 at 100.00 Aaa 1,077,670 New York, General Obligation Bonds, Series 2001, 5.000%, 10/01/17 - FSA Insured - ------------------------------------------------------------------------------------------------------------------------------------ TAX OBLIGATION/LIMITED - 12.9% 600 Battery Park City Authority, New York, Senior Revenue 11/13 at 100.00 AAA 634,374 Bonds, Series 2003A, 5.000%, 11/01/23 Metropolitan Transportation Authority, New York, State Service Contract Refunding Bonds, Series 2002A: 500 5.500%, 1/01/20 - MBIA Insured 7/12 at 100.00 AAA 556,685 500 5.000%, 7/01/30 - AMBAC Insured 7/12 at 100.00 AAA 520,360 1,000 Nassau County Interim Finance Authority, New York, 11/06 at 101.00 AAA 1,058,410 Sales Tax Secured Revenue Bonds, Series 2001A-2, 5.125%, 11/15/21 - AMBAC Insured 670 New York City Transitional Finance Authority, New York, 2/13 at 100.00 AA+ 704,378 Future Tax Secured Bonds, Fiscal Series 2003E, 5.000%, 2/01/23 50 New York State Thruway Authority, Highway and Bridge 4/05 at 102.00 AAA 52,534 Trust Fund Bonds, Series 1995A, 5.125%, 4/01/15 - MBIA Insured 750 New York State Thruway Authority, Highway and Bridge 4/13 at 100.00 AAA 811,732 Trust Fund Bonds, Second General, Series 2003, 5.250%, 4/01/23 - MBIA Insured 250 New York State Thruway Authority, Highway and Bridge 4/14 at 100.00 AAA 267,143 Trust Fund Bonds, Second General, Series 2004, 5.000%, 4/01/21 - MBIA Insured 1,000 New York State Urban Development Corporation, 3/13 at 100.00 AAA 1,115,540 State Personal Income Tax Revenue Bonds, State Facilities and Equipment, Series 2002C-1, 5.500%, 3/15/21 - FGIC Insured 1,000 New York Tobacco Settlement Financing Corporation, 6/13 at 100.00 AAA 1,098,710 Tobacco Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003A-1, 5.250%, 6/01/20 - AMBAC Insured 500 New York Tobacco Settlement Financing Corporation, 6/13 at 100.00 AA- 551,605 Tobacco Settlement Asset-Backed and State Contingency Contract-Backed Bonds, Series 2003B-1C, 5.500%, 6/01/21 - ------------------------------------------------------------------------------------------------------------------------------------ TRANSPORTATION - 5.6% 500 Metropolitan Transportation Authority, New York, No Opt. Call AAA 562,185 Transportation Revenue Bonds, Series 2003A, 5.000%, 11/15/15 - FGIC Insured 2,500 Port Authority of New York and New Jersey, 1/05 at 101.00 AAA 2,617,124 Consolidated Bonds, Ninety-Seventh Series, 6.500%, 7/15/19 (Alternative Minimum Tax) - FGIC Insured - ------------------------------------------------------------------------------------------------------------------------------------ U.S. GUARANTEED - 6.0% 1,420 Dormitory Authority of the State of New York, Judicial No Opt. Call AAA 1,803,570 Facilities Lease Revenue Bonds, Suffolk County Issue, Series 1986, 7.375%, 7/01/16 1,000 New York State Medical Care Facilities Finance Agency, 8/04 at 100.00 AAA 1,019,370 FHA-Insured Mortgage Program Revenue Bonds, Mount Sinai NYU Health Obligated Group, Series 1992C, 6.250%, 8/15/12 (Pre-refunded to 8/15/04) - MBIA Insured 485 Suffolk County Water Authority, New York, Water No Opt. Call AAA 585,480 Revenue Bonds, Series 1986V, 6.750%, 6/01/12 31 Nuveen New York Select Tax-Free Income Portfolio (NXN) (continued) Portfolio of INVESTMENTS March 31, 2004 PRINCIPAL OPTIONAL CALL MARKET AMOUNT (000) DESCRIPTION PROVISIONS* RATINGS** VALUE - ------------------------------------------------------------------------------------------------------------------------------------ UTILITIES - 5.6% $ 2,000 Long Island Power Authority, New York, Electric System 6/08 at 101.00 AAA $ 2,108,880 General Revenue Bonds, Series 1998A, 5.125%, 12/01/22 - FSA Insured 1,000 Long Island Power Authority, New York, Electric System 9/13 at 100.00 AAA 1,089,670 General Revenue Bonds, Series 2003C, 5.000%, 9/01/16 - CIFG Insured - ------------------------------------------------------------------------------------------------------------------------------------ WATER AND SEWER - 12.1% 2,500 New York City Municipal Water Finance Authority, 6/11 at 101.00 AA 2,610,400 New York, Water and Sewer System Revenue Bonds, Fiscal Series 2001C, 5.125%, 6/15/33 New York State Environmental Facilities Corporation, State Clean Water and Drinking Water Revolving Funds Revenue Bonds, New York City Municipal Water Finance Authority Loan, Series 2002B: 2,000 5.250%, 6/15/19 6/12 at 100.00 AAA 2,191,600 2,000 5.000%, 6/15/27 6/12 at 100.00 AAA 2,089,480 - ------------------------------------------------------------------------------------------------------------------------------------ $ 52,980 Total Long-Term Investments (cost $53,512,729) - 99.4% 56,632,879 =============----------------------------------------------------------------------------------------------------------------------- Other Assets Less Liabilities - 0.6% 324,823 -------------------------------------------------------------------------------------------------------------------- Net Assets - 100% $ 56,957,702 ==================================================================================================================== * Optional Call Provisions (not covered by the report of independent auditors): Dates (month and year) and prices of the earliest optional call or redemption. There may be other call provisions at varying prices at later dates. ** Ratings (not covered by the report of independent auditors): Using the higher of Standard & Poor's or Moody's rating. (WI) Security purchased on a when-issued basis. See accompanying notes to financial statements. 32
Statement of ASSETS AND LIABILITIES March 31, 2004
NEW YORK SELECT SELECT SELECT CALIFORNIA SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 SELECT TAX-FREE TAX-FREE (NXP) (NXQ) (NXR) (NXC) (NXN) - ------------------------------------------------------------------------------------------------------------------------------------ ASSETS Investments, at market value (cost $223,802,927, $240,927,177, $175,565,783, $86,129,077 and $53,512,729, respectively) $238,890,176 $251,365,847 $183,541,860 $90,630,799 $56,632,879 Cash -- 1,132,561 -- -- 395,983 Receivables: Interest 4,225,729 4,017,107 2,979,498 1,376,219 800,095 Investments sold 735,100 -- -- -- -- Other assets 59,908 63,718 44,934 21,714 12,655 - ------------------------------------------------------------------------------------------------------------------------------------ Total assets 243,910,913 256,579,233 186,566,292 92,028,732 57,841,612 - ------------------------------------------------------------------------------------------------------------------------------------ LIABILITIES Cash overdraft 567,586 -- 64,901 92,838 -- Payable for investments purchased -- -- -- -- 834,420 Accrued expenses: Management fees 50,746 64,222 47,122 23,636 14,629 Other 127,403 142,390 96,225 48,161 34,861 - ------------------------------------------------------------------------------------------------------------------------------------ Total liabilities 745,735 206,612 208,248 164,635 883,910 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets $243,165,178 $256,372,621 $186,358,044 $91,864,097 $56,957,702 ==================================================================================================================================== Shares outstanding 16,378,096 17,607,068 12,964,124 6,257,070 3,908,223 ==================================================================================================================================== Net asset value per share outstanding (net assets divided by shares outstanding) $ 14.85 $ 14.56 $ 14.37 $ 14.68 $ 14.57 ==================================================================================================================================== NET ASSETS CONSIST OF: - ------------------------------------------------------------------------------------------------------------------------------------ Common shares, $.01 par value per share $ 163,781 $ 176,071 $ 129,641 $ 62,571 $ 39,082 Paid-in surplus 227,635,042 245,690,697 178,372,582 87,121,715 53,622,239 Undistributed (Over-distribution of) net investment income (46,057) (373,447) (125,424) (114,580) 2,359 Accumulated net realized gain from investments 325,163 440,630 5,168 292,669 173,872 Net unrealized appreciation of investments 15,087,249 10,438,670 7,976,077 4,501,722 3,120,150 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets $243,165,178 $256,372,621 $186,358,044 $91,864,097 $56,957,702 ==================================================================================================================================== See accompanying notes to financial statements. 33
Statement of OPERATIONS Year Ended March 31, 2004
NEW YORK SELECT SELECT SELECT CALIFORNIA SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 SELECT TAX-FREE TAX-FREE (NXP) (NXQ) (NXR) (NXC) (NXN) - ------------------------------------------------------------------------------------------------------------------------------------ INVESTMENT INCOME $12,714,505 $13,353,220 $ 9,673,322 $4,582,462 $2,881,085 - ------------------------------------------------------------------------------------------------------------------------------------ EXPENSES Management fees 592,080 747,072 547,905 273,136 170,192 Shareholders' servicing agent fees and expenses 48,127 47,295 36,098 12,963 9,741 Custodian's fees and expenses 55,878 59,960 40,587 23,265 18,930 Trustees' fees and expenses 8,768 7,762 4,718 2,155 1,128 Professional fees 16,675 17,039 13,413 9,665 8,033 Shareholders' reports - printing and mailing expenses 68,054 71,553 38,327 19,061 17,896 Stock exchange listing fees 15,535 15,535 15,535 11,097 11,097 Investor relations expense 7,223 15,004 4,814 3,092 1,677 Other expenses 9,357 9,499 7,740 5,335 4,318 - ------------------------------------------------------------------------------------------------------------------------------------ Total expenses before custodian fee credit 821,697 990,719 709,137 359,769 243,012 Custodian fee credit (13,000) (13,590) (8,192) (7,327) (2,432) - ------------------------------------------------------------------------------------------------------------------------------------ Net expenses 808,697 977,129 700,945 352,442 240,580 - ------------------------------------------------------------------------------------------------------------------------------------ Net investment income 11,905,808 12,376,091 8,972,377 4,230,020 2,640,505 - ------------------------------------------------------------------------------------------------------------------------------------ REALIZED AND UNREALIZED GAIN FROM INVESTMENTS Net realized gain from investments 1,631,548 1,107,932 388,100 528,424 314,601 Change in net unrealized appreciation (depreciation) of investments 764,039 2,207,042 1,738,203 704,451 294,010 - ------------------------------------------------------------------------------------------------------------------------------------ Net gain from investments 2,395,587 3,314,974 2,126,303 1,232,875 608,611 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets from operations $14,301,395 $15,691,065 $11,098,680 $5,462,895 $3,249,116 ==================================================================================================================================== See accompanying notes to financial statements. 34
Statement of CHANGES IN NET ASSETS
SELECT TAX-FREE (NXP) SELECT TAX-FREE 2 (NXQ) SELECT TAX-FREE 3 (NXR) ----------------------------- ------------------------------ --------------------------- YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 3/31/04 3/31/03 3/31/04 3/31/03 3/31/04 3/31/03 - ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 11,905,808 $ 12,666,221 $ 12,376,091 $ 13,377,076 $ 8,972,377 $ 9,450,682 Net realized gain from investments 1,631,548 2,175,032 1,107,932 2,738,597 388,100 2,127,842 Change in net unrealized appreciation (depreciation) of investments 764,039 3,681,890 2,207,042 (417,458) 1,738,203 (545,919) - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets from operations 14,301,395 18,523,143 15,691,065 15,698,215 11,098,680 11,032,605 - ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO SHAREHOLDERS From net investment income (12,405,127) (13,364,529) (12,700,072) (14,058,896) (9,009,179) (9,882,044) From accumulated net realized gains from investments (1,399,973) (2,764,623) (973,580) (3,171,385) (868,194) (850,958) - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets from distributions to shareholders (13,805,100) (16,129,152) (13,673,652) (17,230,281) (9,877,373) (10,733,002) - ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Net proceeds from shares issued to shareholders due to reinvestment of distributions -- -- -- -- -- -- - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets 496,295 2,393,991 2,017,413 (1,532,066) 1,221,307 299,603 Net assets at the beginning of year 242,668,883 240,274,892 254,355,208 255,887,274 185,136,737 184,837,134 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets at the end of year $243,165,178 $242,668,883 $256,372,621 $254,355,208 $186,358,044 $185,136,737 ==================================================================================================================================== Undistributed (Over-distribution of) net investment income at the end of year $ (46,057) $ 452,975 $ (373,447) $ (39,416) $ (125,424) $ (88,622) ==================================================================================================================================== See accompanying notes to financial statements. 35
Statement of CHANGES IN NET ASSETS (Unaudited) (continued)
CALIFORNIA SELECT TAX-FREE (NXC) NEW YORK SELECT TAX-FREE (NXN) -------------------------------- ------------------------------ YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 3/31/04 3/31/03 3/31/04 3/31/03 - ------------------------------------------------------------------------------------------------------------------------------------ OPERATIONS Net investment income $ 4,230,020 $ 4,423,162 $ 2,640,505 $ 2,739,961 Net realized gain from investments 528,424 919,407 314,601 630,086 Change in net unrealized appreciation (depreciation) of investments 704,451 728,613 294,010 1,060,980 - ------------------------------------------------------------------------------------------------------------------------------------ Net increase in net assets from operations 5,462,895 6,071,182 3,249,116 4,431,027 - ------------------------------------------------------------------------------------------------------------------------------------ DISTRIBUTIONS TO SHAREHOLDERS From net investment income (4,262,921) (4,592,689) (2,668,659) (2,742,795) From accumulated net realized gains from investments (310,999) (849,710) (322,333) (366,890) - ------------------------------------------------------------------------------------------------------------------------------------ Decrease in net assets from distributions to shareholders (4,573,920) (5,442,399) (2,990,992) (3,109,685) - ------------------------------------------------------------------------------------------------------------------------------------ CAPITAL SHARE TRANSACTIONS Net proceeds from shares issued to shareholders due to reinvestment of distributions -- -- 16,500 -- - ------------------------------------------------------------------------------------------------------------------------------------ Net increase (decrease) in net assets 888,975 628,783 274,624 1,321,342 Net assets at the beginning of year 90,975,122 90,346,339 56,683,078 55,361,736 - ------------------------------------------------------------------------------------------------------------------------------------ Net assets at the end of year $91,864,097 $90,975,122 $56,957,702 $56,683,078 ==================================================================================================================================== Undistributed (Over-distribution of) net investment income at the end of year $ (114,580) $ (75,837) $ 2,359 $ 30,688 ==================================================================================================================================== See accompanying notes to financial statements. 36
Notes to FINANCIAL STATEMENTS 1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES The Trusts covered in this report and their corresponding Common share New York Stock Exchange symbols are Nuveen Select Tax-Free Income Portfolio (NXP), Nuveen Select Tax-Free Income Portfolio 2 (NXQ), Nuveen Select Tax-Free Income Portfolio 3 (NXR), Nuveen California Select Tax-Free Income Portfolio (NXC) and Nuveen New York Select Tax-Free Income Portfolio (NXN). The Trusts are registered under the Investment Company Act of 1940, as amended, as closed-end, diversified management investment companies. Each Trust seeks to provide stable dividends consistent with the preservation of capital, exempt from regular federal and designated state income taxes, where applicable, by investing primarily in a diversified portfolio of municipal obligations. The following is a summary of significant accounting policies followed by the Trusts in the preparation of their financial statements in accordance with accounting principles generally accepted in the United States. Securities Valuation The prices of municipal bonds in each Trust's investment portfolio are provided by a pricing service approved by the Trust's Board of Trustees. When price quotes are not readily available (which is usually the case for municipal securities), the pricing service establishes fair market value based on yields or prices of municipal bonds of comparable quality, type of issue, coupon, maturity and rating, indications of value from securities dealers, evaluations of anticipated cash flows or collateral and general market conditions. If it is determined that market prices for a security are unavailable or inappropriate, the Board of Trustees of the Trusts, or its designee, may establish a fair value for the security. Temporary investments in securities that have variable rate and demand features qualifying them as short-term securities are valued at amortized cost, which approximates market value. Securities Transactions Securities transactions are recorded on a trade date basis. Realized gains and losses from such transactions are determined on the specific identification method. Securities purchased or sold on a when-issued or delayed delivery basis may have extended settlement periods. The securities so purchased are subject to market fluctuation during this period. The Trusts have instructed the custodian to segregate assets with a current value at least equal to the amount of the when-issued and delayed delivery purchase commitments. At March 31, 2004, New York Select Tax-Free (NXN) had an outstanding when-issued purchase commitment of $834,420. There were no such outstanding purchase commitments in any of the other Trusts. Investment Income Interest income, which includes the amortization of premiums and accretion of discounts for financial reporting purposes, is recorded on an accrual basis. Income Taxes Each Trust is a separate taxpayer for federal income tax purposes. Each Trust intends to comply with the requirements of the Internal Revenue Code applicable to regulated investment companies and to distribute all of its net investment income to its shareholders. Therefore, no federal income tax provision is required. Furthermore, each Trust intends to satisfy conditions which will enable interest from municipal securities, which is exempt from regular federal and designated state income taxes, where applicable, to retain such tax-exempt status when distributed to shareholders of the Trusts. All monthly tax-exempt income dividends paid during the fiscal year ended March 31, 2004, have been designated Exempt Interest Dividends. Dividends and Distributions to Shareholders Dividends from tax-exempt net investment income are declared monthly. Net realized capital gains and/or market discount from investment transactions, if any, are distributed to shareholders not less frequently than annually. Furthermore, capital gains are distributed only to the extent they exceed available capital loss carryforwards. 37 Notes to FINANCIAL STATEMENTS (continued) Distributions to shareholders of tax-exempt net investment income, net realized capital gains and/or market discount, if any, are recorded on the ex-dividend date. The amount and timing of distributions are determined in accordance with federal income tax regulations, which may differ from accounting principles generally accepted in the United States. Derivative Financial Instruments The Trusts are not authorized to invest in derivative financial instruments. Custodian Fee Credit Each Trust has an arrangement with the custodian bank whereby certain custodian fees and expenses are reduced by credits earned on each Trust's cash on deposit with the bank. Such deposit arrangements are an alternative to overnight investments. Indemnifications Under the Trusts' organizational documents, its Officers and Trustees are indemnified against certain liabilities arising out of the performance of their duties to the Trusts. In addition, in the normal course of business, the Trusts enter into contracts that provide general indemnifications to other parties. The Trusts' maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Trusts that have not yet occurred. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results may differ from those estimates. 2. FUND SHARES Transactions in Common shares were as follows:
SELECT SELECT SELECT TAX-FREE (NXP) TAX-FREE 2 (NXQ) TAX-FREE 3 (NXR) ----------------------- ----------------------- ----------------------- YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 3/31/04 3/31/03 3/31/04 3/31/03 3/31/04 3/31/03 - --------------------------------------------------------------------------------------------------------- Shares issued to shareholders due to reinvestment of distributions -- -- -- -- -- -- ========================================================================================================= CALIFORNIA SELECT NEW YORK SELECT TAX-FREE (NXC) TAX-FREE (NXN) ----------------------- ----------------------- YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED 3/31/04 3/31/03 3/31/04 3/31/03 - --------------------------------------------------------------------------------------------------------- Shares issued to shareholders due to reinvestment of distributions -- -- 1,154 -- =========================================================================================================
3. SECURITIES TRANSACTIONS Purchases and sales (including maturities) of investments in long-term municipal securities during the fiscal year ended March 31, 2004, were as follows:
CALIFORNIA NEW YORK SELECT SELECT SELECT SELECT SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE (NXP) (NXQ) (NXR) (NXC) (NXN) - --------------------------------------------------------------------------------------------------------- Purchases $37,515,280 $24,783,282 $10,055,292 $29,251,064 $11,433,307 Sales and maturities 38,823,150 26,664,100 10,832,900 27,001,829 8,980,045 =========================================================================================================
38 4. INCOME TAX INFORMATION The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing income on taxable market discount securities and timing differences in recognizing certain gains and losses on security transactions. At March 31, 2004, the cost of investments were as follows:
CALIFORNIA NEW YORK SELECT SELECT SELECT SELECT SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE (NXP) (NXQ) (NXR) (NXC) (NXN) - ---------------------------------------------------------------------------------------------------------- Cost of investments $223,489,078 $240,848,151 $175,500,669 $86,128,891 $53,508,150 ==========================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments at March 31, 2004, were as follows:
CALIFORNIA NEW YORK SELECT SELECT SELECT SELECT SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE (NXP) (NXQ) (NXR) (NXC) (NXN) - --------------------------------------------------------------------------------------------------------- Gross unrealized: Appreciation $17,435,869 $12,715,594 $8,929,552 $4,595,134 $3,147,206 Depreciation (2,034,771) (2,197,898) (888,361) (93,226) (22,477) - --------------------------------------------------------------------------------------------------------- Net unrealized appreciation of investments $15,401,098 $10,517,696 $8,041,191 $4,501,908 $3,124,729 =========================================================================================================
The tax components of undistributed net investment income and net realized gains at March 31, 2004, were as follows:
CALIFORNIA NEW YORK SELECT SELECT SELECT SELECT SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE (NXP) (NXQ) (NXR) (NXC) (NXN) - --------------------------------------------------------------------------------------------------------- Undistributed net tax-exempt income $639,159 $577,541 $554,901 $235,627 $216,645 Undistributed net ordinary income* 14,208 -- -- -- -- Undistributed net long-term capital gains 310,956 440,630 5,168 292,669 173,872 =========================================================================================================
* Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. The tax character of distributions paid during the fiscal years ended March 31, 2004 and March 31, 2003, was designated for purposes of the dividends paid deduction as follows:
CALIFORNIA NEW YORK SELECT SELECT SELECT SELECT SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE 2004 (NXP) (NXQ) (NXR) (NXC) (NXN) - ---------------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $12,087,037 $12,571,449 $8,945,252 $4,242,294 $2,672,502 Distributions from net ordinary income* 334,467 163,837 63,927 27,740 -- Distributions from net long-term capital gains 1,399,973 973,580 868,194 310,142 322,333 ========================================================================================================== CALIFORNIA NEW YORK SELECT SELECT SELECT SELECT SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE 2003 (NXP) (NXQ) (NXR) (NXC) (NXN) - ---------------------------------------------------------------------------------------------------------- Distributions from net tax-exempt income $13,511,932 $14,208,907 $9,995,343 $4,636,488 $2,754,516 Distributions from net ordinary income* 37,830 46,670 3,378 -- -- Distributions from net long-term capital gains 2,726,793 3,133,168 850,958 849,710 366,890 ==========================================================================================================
* Net ordinary income consists of taxable market discount income and net short-term capital gains, if any. 39 Notes to FINANCIAL STATEMENTS (continued) 5. MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES Under the Trusts' investment management agreements with Nuveen Institutional Advisory Corp. (the "Adviser"), a wholly owned subsidiary of Nuveen Investments, Inc., each Trust pays an annual management fee, payable monthly, at the rates set forth below, which are based upon the average daily net assets of each Trust as follows:
SELECT TAX-FREE 2 (NXQ) SELECT TAX-FREE 3 (NXR) CALIFORNIA SELECT TAX-FREE (NXC) AVERAGE DAILY NET ASSETS SELECT TAX-FREE (NXP) NEW YORK SELECT TAX-FREE (NXN) - --------------------------------------------------------------------------------------------------------- For the first $125 million .2500% .3000% For the next $125 million .2375 .2875 For the next $250 million .2250 .2750 For the next $500 million .2125 .2625 For the next $1 billion .2000 .2500 For net assets over $2 billion .1875 .2375 =========================================================================================================
The management fee compensates the Adviser for overall investment advisory and administrative services and general office facilities. The Trusts pay no compensation directly to those of its Trustees who are affiliated with the Adviser or to their officers, all of whom receive remuneration for their services to the Trusts from the Adviser or its affiliates. 6. INVESTMENT COMPOSITION At March 31, 2004, the revenue sources by municipal purpose, expressed as a percent of total investments, were as follows:
CALIFORNIA NEW YORK SELECT SELECT SELECT SELECT SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE (NXP) (NXQ) (NXR) (NXC) (NXN) - --------------------------------------------------------------------------------------------------------- Consumer Staples 3% 5% 5% 2% 2% Education and Civic Organizations 2 4 6 14 13 Healthcare 17 16 18 15 10 Housing/Multifamily -- 6 7 -- 8 Housing/Single Family 3 3 3 -- 8 Long-Term Care -- -- -- 1 9 Materials 4 2 -- -- -- Tax Obligation/General 10 6 8 22 7 Tax Obligation/Limited 16 13 12 10 13 Transportation 14 16 8 15 6 U.S. Guaranteed 15 10 8 -- 6 Utilities 10 15 22 10 6 Water and Sewer 6 3 3 11 12 Other -- 1 -- -- -- - --------------------------------------------------------------------------------------------------------- 100% 100% 100% 100% 100% =========================================================================================================
Certain investments owned by the Trusts are covered by insurance issued by several private insurers or are backed by an escrow or trust containing U.S. Government or U.S. Government agency securities, both of which ensure the timely payment of principal and interest in the event of default (53% for Select Tax-Free (NXP), 53% for Select Tax-Free 2 (NXQ), 37% for Select Tax-Free 3 (NXR), 65% for California Select Tax-Free (NXC), and 60% for New York Select Tax-Free (NXN)). Such insurance or escrow, however, does not guarantee the market value of the municipal securities or the value of any of the Trusts' shares. For additional information regarding each investment security, refer to the Portfolio of Investments of each Trust. 40 7. SUBSEQUENT EVENT - DISTRIBUTIONS TO SHAREHOLDERS The Trusts declared dividend distributions from their tax-exempt net investment income which were paid on May 3, 2004, to shareholders of record on April 15, 2004, as follows:
CALIFORNIA NEW YORK SELECT SELECT SELECT SELECT SELECT TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE (NXP) (NXQ) (NXR) (NXC) (NXN) - --------------------------------------------------------------------------------------------------------- Dividend per share $.0610 $.0585 $.0575 $.0560 $.0560 =========================================================================================================
41 Financial HIGHLIGHTS Selected data for a share outstanding throughout each year:
INVESTMENT OPERATIONS LESS DISTRIBUTIONS ----------------------------------- ---------------------------- NET REALIZED/ ENDING BEGINNING NET UNREALIZED NET NET ENDING NET ASSET INVESTMENT INVESTMENT INVESTMENT CAPITAL ASSET MARKET VALUE INCOME GAIN (LOSS) TOTAL INCOME GAINS TOTAL VALUE VALUE ================================================================================================================================== SELECT TAX-FREE (NXP) - ---------------------------------------------------------------------------------------------------------------------------------- Year Ended 3/31: 2004 $14.82 $.73 $ .15 $ .88 $(.76) $(.09) $(.85) $14.85 $14.3000 2003 14.67 .77 .37 1.14 (.82) (.17) (.99) 14.82 14.1500 2002 15.05 .88 (.38) .50 (.86) (.02) (.88) 14.67 13.8500 2001 14.89 .91 .15 1.06 (.90) -- (.90) 15.05 14.5000 2000 15.55 .90 (.66) .24 (.90) -- (.90) 14.89 13.6875 SELECT TAX-FREE 2 (NXQ) - ---------------------------------------------------------------------------------------------------------------------------------- Year Ended 3/31: 2004 14.45 .70 .19 .89 (.72) (.06) (.78) 14.56 13.8000 2003 14.53 .76 .14 .90 (.80) (.18) (.98) 14.45 13.4900 2002 14.89 .86 (.36) .50 (.84) (.02) (.86) 14.53 13.6600 2001 14.75 .87 .14 1.01 (.87) -- (.87) 14.89 14.1500 2000 15.41 .87 (.66) .21 (.87) -- (.87) 14.75 13.3750 SELECT TAX-FREE 3 (NXR) - ---------------------------------------------------------------------------------------------------------------------------------- Year Ended 3/31: 2004 14.28 .69 .16 .85 (.69) (.07) (.76) 14.37 13.5600 2003 14.26 .73 .12 .85 (.76) (.07) (.83) 14.28 13.0600 2002 14.53 .81 (.28) .53 (.80) -- (.80) 14.26 13.4200 2001 14.32 .81 .21 1.02 (.81) -- (.81) 14.53 13.7000 2000 14.98 .82 (.66) .16 (.82) -- (.82) 14.32 12.8750 CALIFORNIA SELECT TAX-FREE (NXC) - ---------------------------------------------------------------------------------------------------------------------------------- Year Ended 3/31: 2004 14.54 .68 .19 .87 (.68) (.05) (.73) 14.68 14.0600 2003 14.44 .71 .26 .97 (.73) (.14) (.87) 14.54 13.5900 2002 14.79 .78 (.34) .44 (.77) (.02) (.79) 14.44 14.2500 2001 14.57 .79 .23 1.02 (.79) (.01) (.80) 14.79 13.9400 2000 15.26 .79 (.67) .12 (.79) (.02) (.81) 14.57 13.7500 NEW YORK SELECT TAX-FREE (NXN) - ---------------------------------------------------------------------------------------------------------------------------------- Year Ended 3/31: 2004 14.51 .68 .14 .82 (.68) (.08) (.76) 14.57 14.4000 2003 14.17 .70 .43 1.13 (.70) (.09) (.79) 14.51 13.6000 2002 14.51 .73 (.33) .40 (.74) -- (.74) 14.17 13.7600 2001 14.31 .78 .20 .98 (.78) -- (.78) 14.51 14.0500 2000 14.92 .78 (.61) .17 (.78) -- (.78) 14.31 12.6875 ================================================================================================================================== RATIOS/SUPPLEMENTAL DATA -------------------------------------------------------------------------------------- TOTAL RETURNS BEFORE CREDIT AFTER CREDIT** ----------------------- -------------------------- ---------------------------- RATIO OF NET RATIO OF NET BASED ON ENDING RATIO OF INVESTMENT RATIO OF INVESTMENT BASED ON NET NET EXPENSES TO INCOME TO EXPENSES TO INCOME TO PORTFOLIO MARKET ASSET ASSETS AVERAGE AVERAGE AVERAGE AVERAGE TURNOVER VALUE* VALUE* (000) NET ASSETS NET ASSETS NET ASSETS NET ASSETS RATE ==================================================================================================================================== SELECT TAX-FREE (NXP) - ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 3/31: 2004 7.34% 6.13% $243,165 .34% 4.90% .33% 4.91% 16% 2003 9.51 7.84 242,669 .37 5.20 .36 5.21 35 2002 1.54 3.41 240,275 .38 5.89 .37 5.89 26 2001 12.63 7.32 246,475 .35 6.06 .35 6.07 2 2000 (11.09) 1.62 243,814 .36 5.97 .36 5.97 -- SELECT TAX-FREE 2 (NXQ) - ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 3/31: 2004 8.35 6.31 256,373 .39 4.86 .38 4.86 10 2003 6.01 6.33 254,355 .42 5.20 .41 5.21 46 2002 2.57 3.41 255,887 .43 5.79 .42 5.80 21 2001 12.46 7.04 262,144 .41 5.89 .40 5.90 2 2000 (10.38) 1.43 259,660 .40 5.82 .40 5.82 1 SELECT TAX-FREE 3 (NXR) - ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 3/31: 2004 9.96 6.13 186,358 .38 4.84 .38 4.85 6 2003 3.51 6.09 185,137 .42 5.09 .41 5.10 51 2002 3.84 3.70 184,837 .44 5.59 .42 5.60 9 2001 12.97 7.36 188,344 .47 5.66 .46 5.67 2 2000 (10.29) 1.11 185,671 .41 5.65 .41 5.65 -- CALIFORNIA SELECT TAX-FREE (NXC) - ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 3/31: 2004 9.14 6.16 91,864 .40 4.64 .39 4.65 30 2003 1.34 6.86 90,975 .43 4.84 .42 4.85 42 2002 7.95 3.03 90,346 .44 5.27 .43 5.28 12 2001 7.23 7.21 92,517 .43 5.38 .42 5.39 2 2000 (7.57) .90 91,166 .45 5.37 .45 5.38 3 NEW YORK SELECT TAX-FREE (NXN) - ------------------------------------------------------------------------------------------------------------------------------------ Year Ended 3/31: 2004 11.81 5.84 56,958 .43 4.65 .42 4.65 16 2003 4.73 8.17 56,683 .46 4.85 .45 4.86 35 2002 3.17 2.75 55,362 .49 5.04 .48 5.05 28 2001 17.36 7.02 56,679 .48 5.39 .47 5.40 3 2000 (11.18) 1.21 55,924 .50 5.36 .49 5.37 -- ====================================================================================================================================
* Total Investment Return on Market Value is the combination of reinvested dividend income, reinvested capital gains distributions, if any, and changes in stock price per share. Total Return on Net Asset Value is the combination of reinvested dividend income at net asset value, reinvested capital gains distributions at net asset value, if any, and changes in net asset value per share. Total returns are not annualized. ** After custodian fee credit, where applicable. See accompanying notes to financial statements. 42-43 SPREAD Trustees AND OFFICERS The management of the Trusts, including general supervision of the duties performed for the Trusts by the Adviser, is the responsibility of the Board of Trustees of the Trusts. The number of trustees of the Trusts is currently set at twelve. None of the trustees who are not "interested" persons of the Trusts has ever been a director or employee of, or consultant to, Nuveen or its affiliates. The names and business addresses of the trustees and officers of the Trusts, their principal occupations and other affiliations during the past five years, the number of portfolios each oversees and other directorships they hold are set forth below.
NUMBER OF PORTFOLIOS IN POSITION(S) YEAR FIRST PRINCIPAL OCCUPATION(S) FUND COMPLEX NAME, BIRTHDATE HELD WITH ELECTED OR INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY AND ADDRESS THE TRUSTS APPOINTED(2) DURING PAST 5 YEARS TRUSTEE - ------------------------------------------------------------------------------------------------------------------------------------ TRUSTEE WHO IS AN INTERESTED PERSON OF THE TRUSTS: - ------------------------------------------------------------------------------------------------------------------------------------ Timothy R. Schwertfeger (1) Chairman of 1994 Chairman and Director (since 1996) of Nuveen 144 3/28/49 the Board Investments, Inc. and Nuveen Investments, LLC; Director 333 W. Wacker Drive and Trustee (since 1992) and Chairman (since 1996) of Nuveen Chicago, IL 60606 Advisory Corp. and Nuveen Institutional Advisory Corp.; Chairman and Director (since 1997) of Nuveen Asset Management, Inc.; Director (since 1996) of Institutional Capital Corporation; Chairman and Director (since 1999) of Rittenhouse Asset Management, Inc.; Chairman of Nuveen Investments Advisers Inc. (since 2002). TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE TRUSTS: - ------------------------------------------------------------------------------------------------------------------------------------ Robert P. Bremner Trustee 1997 Private Investor and Management Consultant. 144 8/22/40 333 W. Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Lawrence H. Brown Trustee 1993 Retired (1989) as Senior Vice President of The Northern 144 7/29/34 Trust Company; Director, Community Advisory Board for 333 W. Wacker Drive Highland Park and Highwood, United Way of the North Chicago, IL 60606 Shore (since 2002). - ------------------------------------------------------------------------------------------------------------------------------------ Jack B. Evans Trustee 1999 President, The Hall-Perrine Foundation, a private 144 10/22/48 philanthropic corporation (since 1996); Director, 333 W. Wacker Drive Alliant Energy; Director and Vice Chairman, United Chicago, IL 60606 Fire & Casualty Company; formerly Director, Federal Reserve Bank of Chicago; formerly, President and Chief Operating Officer, SCI Financial Group, Inc., a regional financial services firm. - ------------------------------------------------------------------------------------------------------------------------------------ William C. Hunter Trustee 2004 Dean and Distinguished Professor of Finance, School of 144 3/6/48 Business at the University of Connecticut; previously 333 W. Wacker Drive Senior Vice President and Director of Research at the Chicago, IL 60606 Federal Reserve Bank of Chicago (1995-2003); Director, Credit Research Center at Georgetown University; Director of Xerox Corporation (since 2004). - ------------------------------------------------------------------------------------------------------------------------------------ Anne E. Impellizzeri* Trustee 1994 Retired, formerly, Executive Director (since 1998) of 144 1/26/33 Manitoga (Center for Russel Wright's Design with Nature); 333 W. Wacker Drive prior thereto, President and Chief Executive Officer of Chicago, IL 60606 Blanton-Peale Institute (since 1990); prior thereto, Vice President, Metropolitan Life Insurance Co. - ------------------------------------------------------------------------------------------------------------------------------------ William L. Kissick* Trustee 1992 Professor Emeritus, School of Medicine and the Wharton 144 7/29/32 School of Management and former Chairman, Leonard Davis 333 W. Wacker Drive Institute of Health Economics, University of Chicago, IL 60606 Pennsylvania; Adjunct Professor, Health Policy and Management, Yale University. - ------------------------------------------------------------------------------------------------------------------------------------ Thomas E. Leafstrand* Trustee 1992 Retired; previously, Vice President in charge of 144 11/11/31 Municipal Underwriting and Dealer Sales at The Northern 333 W. Wacker Drive Trust Company. Chicago, IL 60606 44 NUMBER OF PORTFOLIOS IN POSITION(S) YEAR FIRST PRINCIPAL OCCUPATION(S) FUND COMPLEX NAME, BIRTHDATE HELD WITH ELECTED OR INCLUDING OTHER DIRECTORSHIPS OVERSEEN BY AND ADDRESS THE TRUSTS APPOINTED(2) DURING PAST 5 YEARS TRUSTEE - ------------------------------------------------------------------------------------------------------------------------------------ TRUSTEES WHO ARE NOT INTERESTED PERSONS OF THE TRUSTS (CONTINUED): - ------------------------------------------------------------------------------------------------------------------------------------ Peter R. Sawers* Trustee 1991 Adjunct Professor of Business and Economics, University 144 4/3/33 of Dubuque, Iowa; formerly (1991-2000) Adjunct 333 W. Wacker Drive Professor, Lake Forest Graduate School of Management, Chicago, IL 60606 Lake Forest, Illinois; prior thereto, Executive Director, Towers Perrin Australia, a management consulting firm; Chartered Financial Analyst; Certified Management Consultant; Director, Executive Service Corps of Chicago, a not-for-profit organization. - ------------------------------------------------------------------------------------------------------------------------------------ William J. Schneider Trustee 1997 Senior Partner and Chief Operating Officer, 144 9/24/44 Miller-Valentine Group, Vice President, Miller-Valentine 333 W. Wacker Drive Realty, a construction company; Chair, Miami Valley Chicago, IL 60606 Hospital; Chair, Dayton Development Coalition; formerly, Member, Community Advisory Board, National City Bank, Dayton, Ohio and Business Advisory Council, Cleveland Federal Reserve Bank. - ------------------------------------------------------------------------------------------------------------------------------------ Judith M. Stockdale Trustee 1997 Executive Director, Gaylord and Dorothy Donnelley 144 12/29/47 Foundation (since 1994); prior thereto, Executive 333 W. Wacker Drive Director, Great Lakes Protection Fund (from 1990 to 1994) Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Sheila W. Wellington* Trustee 1994 Clinical Professor of Management, Stern/NYU Business 144 2/24/32 School (since 2003); formerly, President (since 1993) 333 W. Wacker Drive of Catalyst (a not-for-profit organization focusing Chicago, IL 60606 on women's leadership development in business and the professions). NUMBER OF PORTFOLIOS IN POSITION(S) YEAR FIRST FUND COMPLEX NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY AND ADDRESS THE TRUSTS APPOINTED(3) DURING PAST 5 YEARS OFFICER - ------------------------------------------------------------------------------------------------------------------------------------ OFFICERS OF THE TRUSTS: - ------------------------------------------------------------------------------------------------------------------------------------ Gifford R. Zimmerman Chief 1988 Managing Director (since 2002), Assistant Secretary and 144 9/9/56 Administrative Associate General Counsel, formerly, Vice President and 333 W. Wacker Drive Officer Assistant General Counsel of Nuveen Investments, LLC; Chicago, IL 60606 Managing Director (since 2002), General Counsel and Assistant Secretary, formerly, Vice President of Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp.; Managing Director (since 2002), Assistant Secretary and Associate General Counsel, formerly, Vice President (since 2000), of Nuveen Asset Management, Inc. Assistant Secretary of Nuveen Investments, Inc. (since 1994); Assistant Secretary of NWQ Investment Management Company, LLC (since 2002); Vice President and Assistant Secretary of Nuveen Investments Advisers Inc. (since 2002); Managing Director, Associate General Counsel and Assistant Secretary of Rittenhouse Asset Management, Inc. (since 2003); Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Michael T. Atkinson Vice President 2000 Vice President (since 2002), formerly, Assistant Vice 144 2/3/66 and Assistant President (since 2000), previously, Associate of Nuveen 333 W. Wacker Drive Secretary Investments, LLC. Chicago, IL 60606 45 Trustees AND OFFICERS (CONTINUED) NUMBER OF PORTFOLIOS IN POSITION(S) YEAR FIRST FUND COMPLEX NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY AND ADDRESS THE TRUSTS APPOINTED(3) DURING PAST 5 YEARS OFFICER - ------------------------------------------------------------------------------------------------------------------------------------ OFFICERS OF THE TRUSTS (CONTINUED): - ------------------------------------------------------------------------------------------------------------------------------------ Paul L. Brennan Vice President 1999 Vice President (since 2002), formerly, Assistant Vice 128 11/10/66 President (since 1997), of Nuveen Advisory Corp.; prior 333 W. Wacker Drive thereto, portfolio manager of Flagship Financial Inc.; Chicago, IL 60606 Chartered Financial Analyst and Certified Public Accountant. - ------------------------------------------------------------------------------------------------------------------------------------ Peter H. D'Arrigo Vice President 1999 Vice President of Nuveen Investments, LLC (since 1999), 144 11/28/67 and Treasurer prior thereto, Assistant Vice President (since 1997); 333 W. Wacker Drive Vice President and Treasurer of Nuveen Investments, Chicago, IL 60606 Inc. (since 1999); Vice President and Treasurer of Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp (since 1999); Vice President and Treasurer of Nuveen Asset Management, Inc. (since 2002) and of Nuveen Investments Advisers Inc. (since 2002); Assistant Treasurer of NWQ Investment Management Company, LLC (since 2002); Vice President and Treasurer of Nuveen Rittenhouse Asset Management, Inc. (since 2003); Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Susan M. DeSanto Vice President 2001 Vice President of Nuveen Advisory Corp. (since 2001); 144 9/8/54 previously, Vice President of Van Kampen Investment 333 W. Wacker Drive Advisory Corp. (since 1998); Vice President of Nuveen Chicago, IL 60606 Institutional Advisory Corp. (since 2002); prior thereto, Assistant Vice President of Van Kampen Investment Advisory Corp. (since 1994). - ------------------------------------------------------------------------------------------------------------------------------------ Jessica R. Droeger Vice President 2000 Vice President (since 2002) and Assistant General 144 9/24/64 and Secretary Counsel (since 1998); formerly, Assistant Vice President 333 W. Wacker Drive (since 1998) of Nuveen Investments, LLC; Vice President Chicago, IL 60606 (since 2002) and Assistant Secretary (since 1998), formerly Assistant Vice President of Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. - ------------------------------------------------------------------------------------------------------------------------------------ Lorna C. Ferguson Vice President 1998 Managing Director (since 2004) formerly, Vice President 144 10/24/45 of Nuveen Investments, LLC; Managing Director (since 333 W. Wacker Drive 2004) formerly, Vice President (since 1998) of Nuveen Chicago, IL 60606 Advisory Corp. and Nuveen Institutional Advisory Corp. - ------------------------------------------------------------------------------------------------------------------------------------ William M. Fitzgerald Vice President 1995 Managing Director (since 2002) of Nuveen Investments, 144 3/2/64 LLC; Managing Director (since 2001), formerly Vice 333 W. Wacker Drive President of Nuveen Advisory Corp. and Nuveen Chicago, IL 60606 Institutional Advisory Corp. (since 1995); Managing Director of Nuveen Asset Management, Inc. (since 2001); Vice President of Nuveen Investment Advisers Inc. (since 2002); Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Stephen D. Foy Vice President 1998 Vice President (since 1993) and Funds Controller 144 5/31/54 and Controller (since 1998) of Nuveen Investments, LLC and Vice 333 W. Wacker Drive President and Funds Controller (since 1998) of Chicago, IL 60606 Nuveen Investments, Inc.; Certified Public Accountant. - ------------------------------------------------------------------------------------------------------------------------------------ J. Thomas Futrell Vice President 1988 Vice President of Nuveen Advisory Corp.; Chartered 128 7/5/55 Financial Analyst. 333 W. Wacker Drive Chicago, IL 60606 46 NUMBER OF PORTFOLIOS IN POSITION(S) YEAR FIRST FUND COMPLEX NAME, BIRTHDATE HELD WITH ELECTED OR PRINCIPAL OCCUPATION(S) OVERSEEN BY AND ADDRESS THE TRUSTS APPOINTED(3) DURING PAST 5 YEARS OFFICER - ------------------------------------------------------------------------------------------------------------------------------------ OFFICERS OF THE TRUSTS (CONTINUED): - ------------------------------------------------------------------------------------------------------------------------------------ Steven J. Krupa Vice President 1990 Vice President of Nuveen Advisory Corp. 128 8/21/57 333 W. Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ David J. Lamb Vice President 2000 Vice President (since 2000) of Nuveen Investments, 144 3/22/63 LLC, previously Assistant Vice President (since 1999); 333 W. Wacker Drive prior thereto, Associate of Nuveen Investments, LLC; Chicago, IL 60606 Certified Public Accountant. - ------------------------------------------------------------------------------------------------------------------------------------ Tina M. Lazar Vice President 2002 Vice President (since 1999), previously, Assistant Vice 144 8/27/61 President (since 1993) of Nuveen Investments, LLC. 333 W. Wacker Drive Chicago, IL 60606 - ------------------------------------------------------------------------------------------------------------------------------------ Larry W. Martin Vice President 1988 Vice President, Assistant Secretary and Assistant 144 7/27/51 and Assistant General Counsel of Nuveen Investments, LLC; Vice 333 W. Wacker Drive Secretary President and Assistant Secretary of Nuveen Advisory Chicago, IL 60606 Corp. and Nuveen Institutional Advisory Corp.; Assistant Secretary of Nuveen Investments, Inc. and (since 1997) Nuveen Asset Management, Inc.; Vice President (since 2000), Assistant Secretary and Assistant General Counsel (since 1998) of Rittenhouse Asset Management, Inc.; Vice President and Assistant Secretary of Nuveen Investments Advisers Inc. (since 2002); Assistant Secretary of NWQ Investment Management Company, LLC (since 2002). - ------------------------------------------------------------------------------------------------------------------------------------ John V. Miller Vice President 2003 Vice President (since 2003) previously, Assistant 128 4/10/67 Vice President (since 1999), prior thereto, credit 333 W. Wacker Drive analyst (since 1996) of Nuveen Advisory Corp.; Chicago, IL 60606 Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Edward F. Neild, IV Vice President 1996 Managing Director (since 2002) of Nuveen Investments, 144 7/7/65 LLC; Managing Director (since 1997), formerly Vice 333 W. Wacker Drive President (since 1996) of Nuveen Advisory Corp. and Chicago, IL 60606 Nuveen Institutional Advisory Corp.; Managing Director of Nuveen Asset Management, Inc. (since 1999). Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Daniel S. Solender Vice President 2003 Vice President of Nuveen Advisory Corp. (since 2003); 128 10/27/65 previously, Principal and portfolio manager with The 333 W. Wacker Drive Vanguard Group (1999-2003); prior thereto, Assistant Chicago, IL 60606 Vice President of the Nuveen Advisory Corp.; Chartered Financial Analyst. - ------------------------------------------------------------------------------------------------------------------------------------ Thomas C. Spalding Vice President 1982 Vice President of Nuveen Advisory Corp. and Nuveen 128 7/31/51 Institutional Advisory Corp.; Chartered Financial 333 W. Wacker Drive Analyst. Chicago, IL 60606
* Trustee will be retiring on June 30, 2004. (1) Mr. Schwertfeger is an "interested person" of the Trusts, as defined in the Investment Company Act of 1940, because he is an officer and trustee of the Adviser. (2) Trustees serve an indefinite term until his/her successor is elected. The year first elected or appointed represents the year in which the Trustee was first elected or appointed to any fund in the Nuveen Complex. (3) Officers serve one year terms through July of each year. The year first elected or appointed represents the year in which the Officer was first elected or appointed to any fund in the Nuveen Complex. 47 Build Your Wealth AUTOMATICALLY Sidebar text: NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET UP YOUR REINVESTMENT ACCOUNT. NUVEEN CLOSED-END EXCHANGE-TRADED FUNDS DIVIDEND REINVESTMENT PLAN Your Nuveen Closed-End Exchange-Traded Fund allows you to conveniently reinvest dividends and/or capital gains distributions in additional fund shares. By choosing to reinvest, you'll be able to invest money regularly and automatically, and watch your investment grow through the power of tax-free compounding. Just like dividends or distributions in cash, there may be times when income or capital gains taxes may be payable on dividends or distributions that are reinvested. It is important to note that an automatic reinvestment plan does not ensure a profit, nor does it protect you against loss in a declining market. EASY AND CONVENIENT To make recordkeeping easy and convenient, each month you'll receive a statement showing your total dividends and distributions, the date of investment, the shares acquired and the price per share, and the total number of shares you own. HOW SHARES ARE PURCHASED The shares you acquire by reinvesting will either be purchased on the open market or newly issued by the Fund. If the shares are trading at or above net asset value at the time of valuation, the Fund will issue new shares at the then-current market price. If the shares are trading at less than net asset value, shares for your account will be purchased on the open market. Dividends and distributions received to purchase shares in the open market will normally be invested shortly after the dividend payment date. No interest will be paid on dividends and distributions awaiting reinvestment. Because the market price of shares may increase before purchases are completed, the average purchase price per share may exceed the market price at the time of valuation, resulting in the acquisition of fewer shares than if the dividend or distribution had been paid in shares issued by the Fund. A pro rata portion of any applicable brokerage commissions on open market purchases will be paid by Plan participants. These commissions usually will be lower than those charged on individual transactions. FLEXIBILITY You may change your distribution option or withdraw from the Plan at any time, should your needs or situation change. Should you withdraw, you can receive a certificate for all whole shares credited to your reinvestment account and cash payment for fractional shares, or cash payment for all reinvestment account shares, less brokerage commissions and a $2.50 service fee. You can reinvest whether your shares are registered in your name, or in the name of a brokerage firm, bank, or other nominee. Ask your investment advisor if his or her firm will participate on your behalf. Participants whose shares are registered in the name of one firm may not be able to transfer the shares to another firm and continue to participate in the Plan. The Fund reserves the right to amend or terminate the Plan at any time. Although the Fund reserves the right to amend the Plan to include a service charge payable by the participants, there is no direct service charge to participants in the Plan at this time. For more information on the Nuveen Automatic Reinvestment Plan or to enroll in or withdraw from the Plan, speak with your financial advisor or call us at (800) 257-8787. 48 Fund INFORMATION BOARD OF TRUSTEES Robert P. Bremner Lawrence H. Brown Jack B. Evans William C. Hunter Anne E. Impellizzeri William L. Kissick Thomas E. Leafstrand Peter R. Sawers William J. Schneider Timothy R. Schwertfeger Judith M. Stockdale Sheila W. Wellington FUND MANAGER Nuveen Institutional Advisory Corp. 333 West Wacker Drive Chicago, IL 60606 CUSTODIAN State Street Bank & Trust Boston, MA TRANSFER AGENT AND SHAREHOLDER SERVICES State Street Bank & Trust Nuveen Funds P.O. Box 43071 Providence, RI 02940-3071 (800) 257-8787 LEGAL COUNSEL Chapman and Cutler LLP Chicago, IL INDEPENDENT AUDITORS Ernst & Young LLP Chicago, IL PROXY VOTING POLICIES AND PROCEDURES A description of the policies and procedures that the Funds use to determine how to vote proxies relating to portfolio securities is available (i) without charge, upon request, by calling Nuveen Investments at (800) 257-8787; and (ii) on the Commission's website at http://www.sec.gov. GLOSSARY OF TERMS USED IN THIS REPORT Average Annual Total Return: This is a commonly used method to express an investment's performance over a particular, usually multi-year time period. It expresses the return (including change in NAV and reinvested dividends) that would have been necessary on an annual basis to equal the investment's actual performance over the time period being considered. Average Effective Maturity: The average of all the maturities of the bonds in a fund's portfolio, computed by weighting each maturity date (the date the security comes due) by the market value of the security. This figure does not account for the likelihood of prepayments or the exercise of call provisions. Leverage-Adjusted Duration: Duration is a measure of a bond or bond fund's sensitivity to changes in interest rates. Generally, the longer a bond or fund's duration, the more the price of the bond or fund will change as interest rates change. Leverage-adjusted duration takes into account the leveraging process for a Fund and therefore is generally longer than the duration of the actual portfolio of individual bonds that make up the Fund. Market Yield (also known as Dividend Yield or Current Yield): An investment's current annualized dividend divided by its current market price. Net Asset Value (NAV): A fund's NAV is calculated by subtracting the liabilities of the fund from its total assets and then dividing the remainder by the number of shares outstanding. Fund NAVs are calculated at the end of each business day. Taxable-Equivalent Yield: The yield necessary from a fully taxable investment to equal, on an after-tax basis, the yield of a municipal bond investment. - --------- Each Fund intends to repurchase shares of its own common or preferred stock in the future at such times and in such amounts as is deemed advisable. No shares were repurchased during the period ended March 31, 2004. Any future repurchases will be reported to shareholders in the next annual or semiannual report. 49 Serving Investors FOR GENERATIONS Since 1898, financial advisors and their clients have relied on Nuveen Investments to provide dependable investment solutions. For the past century, Nuveen Investments has adhered to the belief that the best approach to investing is to apply conservative risk-management principles to help minimize volatility. Building on this tradition, we today offer a range of high quality equity and fixed-income solutions that are integral to a well-diversified core portfolio. Our clients have come to appreciate this diversity, as well as our continued adherence to proven, long-term investing principles. Managing $90 billion in assets, Nuveen Investments offers access to a number of different asset classes and investing solutions through a variety of products. Nuveen Investments markets its capabilities under four distinct brands: Nuveen, a leader in tax-free investments; NWQ, a leader in value-style equities; Rittenhouse, a leader in growth-style equities; and Symphony, a leading institutional manager of market-neutral alternative investment portfolios. To learn more about the products and services Nuveen Investments offers and for a prospectus, where applicable, talk to your financial advisor, or call us at (800) 257-8787. Please read the information carefully before you invest. Distributed by NUVEEN INVESTMENTS, LLC | 333 West Wacker Drive | Chicago, Illinois 60606 | www.nuveen.com EAN-B-0304D ITEM 2. CODE OF ETHICS. As of the end of the period covered by this report, the registrant has adopted a code of ethics that applies to the registrant's principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions. The registrant has posted such code of ethics on its website at www.nuveen.com/etf. ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT. During the reporting period, the registrant's board of directors determined that the registrant had at least one "audit committee financial expert" (as defined in Item 3 of Form N-CSR) serving on its Audit Committee. The registrant's audit committee financial expert for the reporting period was William E. Bennett, who is "independent" for purposes of Item 3 of Form N-CSR. Although Mr. Bennett served as the audit committee financial expert for the reporting period he unexpectedly resigned from the Board effective April 30, 2004. The Nominating and Governance Committee has begun to evaluate existing Audit Committee Members to determine whether any qualify as audit committee financial experts. In addition, the Nominating and Governance Committee has begun a search for a new board member that would be a suitable replacement for Mr. Bennett. Mr. Bennett was formerly Executive Vice President and Chief Credit Officer of First Chicago Corporation and its principal subsidiary, The First National Bank of Chicago. As part of his role as Chief Credit Officer, Mr. Bennett set policy as to accrual of assets/loans; designated performing/non-performing assets; set the level of reserves against the credit portfolo; and determined the carrying value of credit related assets and exposure. Among other things, Mr. Bennett was also responsible for the oversight of the internal analysis function including setting ground rules for the review and preparation of financial analysis and financial statements for use in making credit and risk decisions for financial analysis and financial statements for use in making credit and risk decisions for clients. Mr. Bennett has significant experience reviewing, analyzing and evaluating financial statements of domestic and international companies in a variety of industries with complex accounting issues. ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES. NUVEEN CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO FORM N-CSR DISCLOSURE RE: AUDIT FEES The following table shows the amount of fees that Ernst & Young LLP, the Fund's auditor, billed to the Fund during the Fund's last two full fiscal years. For engagements with Ernst & Young LLP entered into on or after May 6, 2003, the Audit Committee approved in advance all audit services and non-audit services that Ernst & Young LLP provided to the Fund, except for those non-audit services that were subject to the pre-approval exception under Rule 2-01 of Regulation S-X (the "pre-approval exception"). The pre-approval exception for services provided directly to the Fund waives the pre-approval requirement for services other than audit, review or attest services if: (A) the aggregate amount of all such services provided constitutes no more than 5% of the total amount of revenues paid by the Fund during the fiscal year in which the services are provided; (B) the Fund did not recognize the services as non-audit services at the time of the engagement; and (C) the services are promptly brought to the Audit Committee's attention, and the Committee (or its delegate) approves the services before the audit is completed. The Audit Committee has delegated certain pre-approval responsibilities to its Chairman (or, in his absence, any other member of the Audit Committee). SERVICES THAT THE FUND'S AUDITOR BILLED TO THE FUND
AUDIT FEES BILLED AUDIT-RELATED FEES TAX FEES ALL OTHER FEES FISCAL YEAR ENDED TO FUND BILLED TO FUND BILLED TO FUND BILLED TO FUND ============================================================================================================================= March 31, 2004 $ 7,419 $ 0 $ 364 $ 0 - ----------------------------------------------------------------------------------------------------------------------------- Percentage approved N/A 0% 0% 0% pursuant to pre-approval exception - ----------------------------------------------------------------------------------------------------------------------------- March 31, 2003 $ 6,747 $ 0 $ 350 $ 0 - ----------------------------------------------------------------------------------------------------------------------------- Percentage approved N/A 0% 0% 0% pursuant to pre-approval exception - -----------------------------------------------------------------------------------------------------------------------------
The above "Tax Fees" were billed for professional services for tax advice, tax compliance and tax planning. SERVICES THAT THE FUND'S AUDITOR BILLED TO THE ADVISER AND AFFILIATED FUND SERVICE PROVIDERS The following table shows the amount of fees billed by Ernst & Young LLP to Nuveen Institutional Advisory Corp. ("NIAC" or the "Adviser"), and any entity controlling, controlled by or under common control with NIAC ("control Affiliate") that provides ongoing services to the Fund ("Affiliated Fund Service Provider"), for engagements directly related to the Fund's operations and financial reporting, during the Fund's last two full fiscal years. The table also shows the percentage of fees subject to the pre-approval exception. The pre-approval exception for services provided to the Adviser and any Affiliated Fund Service Provider (other than audit, review or attest services) waives the pre-approval requirement if: (A) the aggregate amount of all such services provided constitutes no more than 5% of the total amount of revenues paid to Ernst & Young LLP by the Fund, the Adviser and Affiliated Fund Service Providers during the fiscal year in which the services are provided that would have to be pre-approved by the Audit Committee; (B) the Fund did not recognize the services as non-audit services at the time of the engagement; and (C) the services are promptly brought to the Audit Committee's attention, and the Committee (or its delegate) approves the services before the Fund's audit is completed.
FISCAL YEAR ENDED AUDIT-RELATED FEES TAX FEES BILLED TO ALL OTHER FEES BILLED TO ADVISER AND ADVISER AND BILLED TO ADVISER AFFILIATED FUND AFFILIATED FUND AND AFFILIATED FUND SERVICE PROVIDERS SERVICE PROVIDERS SERVICE PROVIDERS ======================================================================================================== March 31, 2004 $ 0 $ 0 $ 0 - -------------------------------------------------------------------------------------------------------- Percentage approved 0% 0% 0% pursuant to pre-approval exception - -------------------------------------------------------------------------------------------------------- March 31, 2003 $ 0 $ 0 $ 0 - -------------------------------------------------------------------------------------------------------- Percentage approved N/A N/A N/A pursuant to pre-approval exception - --------------------------------------------------------------------------------------------------------
NON-AUDIT SERVICES The following table shows the amount of fees that Ernst & Young LLP billed during the Fund's last two full fiscal years for non-audit services. For engagements entered into on or after May 6, 2003, the Audit Committee is required to pre-approve non-audit services that Ernst & Young LLP provides to the Adviser and any Affiliated Fund Services Provider, if the engagement related directly to the Fund's operations and financial reporting (except for those subject to the de minimis exception described above). The Audit Committee requested and received information from Ernst & Young LLP about any non-audit services that Ernst & Young LLP rendered during the Fund's last fiscal year to the Adviser and any Affiliated Fund Service Provider. The Committee considered this information in evaluating Ernst & Young LLP independence.
FISCAL YEAR ENDED TOTAL NON-AUDIT FEES BILLED TO ADVISER AND AFFILIATED FUND SERVICE TOTAL NON-AUDIT FEES PROVIDERS (ENGAGEMENTS BILLED TO ADVISER AND RELATED DIRECTLY TO THE AFFILIATED FUND SERVICE TOTAL NON-AUDIT FEES OPERATIONS AND FINANCIAL PROVIDERS (ALL OTHER BILLED TO FUND REPORTING OF THE FUND) ENGAGEMENTS) TOTAL =================================================================================================================== March 31, 2004 $ 364 $ 0 $ 0 $ 364 March 31, 2003 $ 350 $ 0 $ 0 $ 350
Audit Committee Pre-Approval Policies and Procedures. Generally, the audit committee must approve (i) all non-audit services to be performed for the Fund by the Fund's independent accountants and (ii) all audit and non-audit services to be performed by the Fund's independent accountants for the Affiliated Fund Service Providers with respect to operations and financial reporting of the Fund. Regarding tax and research projects conducted by the independent accountants for the Fund and Affiliated Fund Service Providers (with respect to operations and financial reports of the Fund) such engagements will be (i) pre-approved by the audit committee if they are expected to be for amounts greater than $10,000; (ii) reported to the audit committee chairman for his verbal approval prior to engagement if they are expected to be for amounts under $10,000 but greater than $5,000; and (iii) reported to the audit committee at the next audit committee meeting if they are expected to be for an amount under $5,000. ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS. Not applicable at this time. ITEM 6. SCHEDULE OF INVESTMENTS. Not applicable at this time. ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END MANAGEMENT INVESTMENT COMPANIES. In the rare event that a municipal issuer held by the Fund were to issue a proxy or that the Fund were to receive a proxy issued by a cash management security, Nuveen Advisory Corp. (the "Adviser") would either engage an independent third party to determine how the proxy should be voted or vote the proxy with the consent, or based on the instructions, of the Fund's Board of Directors or Trustees or its representative. In the case of a conflict of interest, the proxy would be submitted to the applicable Fund's Board to determine how the proxy should be voted. A member of the Adviser's legal department would oversee the administration of the voting, and ensure that records were maintained in accordance with Rule 204-2(c)(2) under the Investment Advisers Act of 1940 (17 CFR 275.204-2(c)(2)), reports were filed with the SEC on Form N-PX, and the results were provided to the Board of Directors or Trustees and made available to shareholders as required by applicable rules. ITEM 8. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT COMPANY AND AFFILIATED PURCHASERS. Not applicable at this time. ITEM 9. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. In the event of a vacancy on the Board, the nominating and governance committee receives suggestions from various sources as to suitable candidates. Suggestions should be sent in writing to Lorna Ferguson, Vice President for Board Relations, Nuveen Investments, 333 West Wacker Drive, Chicago, IL 60606. The nominating and governance committee sets appropriate standards and requirements for nominations for new directors and reserves the right to interview all candidates and to make the final selection of any new directors. ITEM 10. CONTROLS AND PROCEDURES. (a) The registrant's principal executive and principal financial officers, or persons performing similar functions, have concluded that the registrant's disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940, as amended (the "1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")(17 CFR 240.13a-15(b) or 240.15d-15(b)). (b) There were no changes in the registrant's internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act (17 CFR 270.30a-3(d)) that occurred during the registrant's last fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting. ITEM 11. EXHIBITS. File the exhibits listed below as part of this Form. Letter or number the exhibits in the sequence indicated. (a)(1) Any code of ethics, or amendment thereto, that is the subject of the disclosure required by Item 2, to the extent that the registrant intends to satisfy the Item 2 requirements through filing of an exhibit: Not applicable because posted on registrant's website at www.nuveen.com/etf. (a)(2) A separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: Ex-99.CERT Attached hereto. (a)(3) Any written solicitation to purchase securities under Rule 23c-1 under the 1940 Act (17 CFR 270.23c-1) sent a giver during the period covered by the report by or on behalf of the registrant to 10 or more persons. Not applicable at this time. (b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act, provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR 270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR 240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished pursuant to this paragraph will not be deemed "filed" for purposes of Section 18 of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of that section. Such certification will not be deemed to be incorporated by reference into any filing under the Securities Act of 1933 or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference. Ex-99.906 CERT attached hereto. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. (Registrant) Nuveen California Select Tax-Free Income Portfolio ----------------------------------------------------------- By (Signature and Title)* /s/ Jessica R. Droeger ---------------------------------------------- Jessica R. Droeger Vice President and Secretary Date: June 9, 2004 ------------------------------------------------------------------- Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated. By (Signature and Title)* /s/ Gifford R. Zimmerman ---------------------------------------------- Gifford R. Zimmerman Chief Administrative Officer (Principal Executive Officer) Date: June 9, 2004 ------------------------------------------------------------------- By (Signature and Title)* /s/ Stephen D. Foy ---------------------------------------------- Stephen D. Foy Vice President and Controller (Principal Financial Officer) Date: June 9, 2004 ------------------------------------------------------------------- * Print the name and title of each signing officer under his or her signature. EX-99.CERT 2 file002.txt CERTIFICATIONS CERTIFICATION I, Gifford R. Zimmerman, certify that: 1. I have reviewed this report on Form N-CSR of Nuveen California Select Tax-Free Income Portfolio; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: June 9, 2004 /s/ Gifford R. Zimmerman ------------------------- -------------------------------- Chief Administrative Officer (Principal Executive Officer) CERTIFICATION I, Stephen D. Foy, certify that: 1. I have reviewed this report on Form N-CSR of Nuveen California Select Tax-Free Income Portfolio; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) for the registrant and have: (a) designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; (b) evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and (c) disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal half-year (the registrant's second fiscal half-year in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): (a) all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize, and report financial information; and (b) any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: June 9, 2004 /s/ Stephen D. Foy ------------------------- -------------------------------- Vice President and Controller (Principal Financial Officer) EX-99.906CERT 3 file003.txt CERTIFICATIONS Certification Pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002; provided by the Chief Executive Officer and Chief Financial Officer, based on each such officer's knowledge and belief. The undersigned officers of Nuveen California Select Tax-Free Income Portfolio (the "Fund"), certify that, to the best of each such officer's knowledge and belief: 1. The Form N-CSR of the Fund for the period ended March 31, 2004 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and 2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Fund. Date: June 9, 2004 ----------------------- /s/ Gifford R. Zimmerman --------------------- Chief Administrative Officer (Chief Executive Officer) /s/ Stephen D. Foy --------------------- Vice President, Controller (Chief Financial Officer) -----END PRIVACY-ENHANCED MESSAGE-----