nvcsrs
 
 
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: 811-21227
Eaton Vance Pennsylvania Municipal Bond Fund
(formerly, Eaton Vance Insured Pennsylvania Municipal Bond Fund)
Two International Place, Boston, Massachusetts 02110
(Address of Principal Executive Offices)
Maureen A. Gemma
Two International Place, Boston, Massachusetts 02110
(Name and Address of Agent for Services)
(617) 482-8260
(registrant’s Telephone Number)
September 30
Date of Fiscal Year End
March 31, 2010
Date of Reporting Period
 
 

 

 

Item 1. Reports to Stockholders

 

 

(PICTURE)

 

 

 
IMPORTANT NOTICES REGARDING PRIVACY,
DELIVERY OF SHAREHOLDER DOCUMENTS,
PORTFOLIO HOLDINGS AND PROXY VOTING
 
Privacy. The Eaton Vance organization is committed to ensuring your financial privacy. Each of the financial institutions identified below has in effect the following policy (Privacy Policy) with respect to nonpublic personal information about its customers:
 
  •  Only such information received from you, through application forms or otherwise, and information about your Eaton Vance fund transactions will be collected. This may include information such as name, address, social security number, tax status, account balances and transactions.
 
  •  None of such information about you (or former customers) will be disclosed to anyone, except as permitted by law (which includes disclosure to employees necessary to service your account). In the normal course of servicing a customer’s account, Eaton Vance may share information with unaffiliated third parties that perform various required services such as transfer agents, custodians and broker/dealers.
 
  •  Policies and procedures (including physical, electronic and procedural safeguards) are in place that are designed to protect the confidentiality of such information.
 
  •  We reserve the right to change our Privacy Policy at any time upon proper notification to you. Customers may want to review our Privacy Policy periodically for changes by accessing the link on our homepage: www.eatonvance.com.
 
Our pledge of privacy applies to the following entities within the Eaton Vance organization: the Eaton Vance Family of Funds, Eaton Vance Management, Eaton Vance Investment Counsel, Boston Management and Research, and Eaton Vance Distributors, Inc.
 
In addition, our Privacy Policy applies only to those Eaton Vance customers who are individuals and who have a direct relationship with us. If a customer’s account (i.e., fund shares) is held in the name of a third-party financial adviser/broker-dealer, it is likely that only such adviser’s privacy policies apply to the customer. This notice supersedes all previously issued privacy disclosures.
 
For more information about Eaton Vance’s Privacy Policy, please call 1-800-262-1122.
 
 
 
 
Delivery of Shareholder Documents. The Securities and Exchange Commission (the “SEC”) permits funds to deliver only one copy of shareholder documents, including prospectuses, proxy statements and shareholder reports, to fund investors with multiple accounts at the same residential or post office box address. This practice is often called “householding” and it helps eliminate duplicate mailings to shareholders.
 
Eaton Vance, or your financial adviser, may household the mailing of your documents indefinitely unless you instruct Eaton Vance, or your financial adviser, otherwise.
 
If you would prefer that your Eaton Vance documents not be householded, please contact Eaton Vance at 1-800-262-1122, or contact your financial adviser.
 
Your instructions that householding not apply to delivery of your Eaton Vance documents will be effective within 30 days of receipt by Eaton Vance or your financial adviser.
 
 
 
 
Portfolio Holdings. Each Eaton Vance Fund and its underlying Portfolio(s) (if applicable) will file a schedule of portfolio holdings on Form N-Q with the SEC for the first and third quarters of each fiscal year. The Form N-Q will be available on the Eaton Vance website at www.eatonvance.com, by calling Eaton Vance at 1-800-262-1122 or in the EDGAR database on the SEC’s website at www.sec.gov. Form N-Q may also be reviewed and copied at the SEC’s public reference room in Washington, D.C. (call 1-800-732-0330 for information on the operation of the public reference room).
 
 
 
 
Proxy Voting. From time to time, funds are required to vote proxies related to the securities held by the funds. The Eaton Vance Funds or their underlying Portfolios (if applicable) vote proxies according to a set of policies and procedures approved by the Funds’ and Portfolios’ Boards. You may obtain a description of these policies and procedures and information on how the Funds or Portfolios voted proxies relating to portfolio securities during the most recent 12 month period ended June 30, without charge, upon request, by calling 1-800-262-1122. This description is also available on the SEC’s website at www.sec.gov.

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
TABLE OF CONTENTS
         
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    7  
    8  
    9  
    10  
    11  
 
        
Financial Statements
     12  
 
        
Notice to Shareholders
     73  
 
        
Special Meeting of Shareholders
     74  
 
        
Board of Trustees’ Annual Approval of the Investment Advisory Agreements
     75  
 
        
Officers and Trustees
     79  

1

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
INVESTMENT UPDATE
Eaton Vance Municipal Bond Funds (the “Funds”) are closed-end funds traded on the NYSE Amex, which are designed to provide current income exempt from regular federal income tax, federal alternative minimum tax and, in state specific funds, state personal income taxes. On January 29, 2010, shareholders of the Funds approved a modification to each Fund’s 80 percent policy to eliminate the requirement to invest primarily in insured municipal obligations and to eliminate “Insured” from each Fund’s name. Under normal market conditions, the Funds are now required to invest at least 80 percent of net assets in municipal obligations rated A or better by Moody’s Investors Service, Inc., Standard & Poor’s Ratings Group or Fitch Ratings.
Economic and Market Conditions
During the six months ending March 31, 2010, the U.S. economy and the capital markets remained relatively stable, despite continued high unemployment and concerns over the U.S. budget. The economy grew at an annualized rate of 5.7% in the fourth quarter of 2009 and an estimated 3.2% in the first quarter of 2010, according to the U.S. Department of Commerce.
During the six-month period, the municipal bond market’s performance was relatively flat, with slightly negative returns in the fourth quarter of 2009 being offset by positive performance of just over 1% in the first quarter of 2010. For the period, the Barclays Capital Municipal Bond Index (the Index) — a broad-based index of municipal bonds — gained 0.28%.1 This performance followed one of the best calendar year periods for municipals in many years, however. Moreover, economic fundamentals continued to improve and demand for municipals remained strong.
The significant performance disparities among the municipal market’s segments, which became historically wide during 2008 and the first three quarters of 2009, began to dissipate during the six-month period. For the first time in almost two years, we witnessed a period in which there were not significant differences in muni performance by maturity, credit quality and sector. In the face of limited tax-exempt supply, due to the success of the Build America Bond program, demand from municipal investors remained positive during the period, though the gusto with which they purchased municipal funds waned from 2009 levels. We believe lighter inflows were likely driven by lower yields, a continuation of credit-related headline “noise” and investor preparation for tax bills in March and April.
Management Discussion
During the six months ending March 31, 2010, the Funds underperformed their respective benchmark indices at net asset value.1 Given the combination of our Funds’ objective of providing tax-exempt income and the municipal yield curve’s historically upward slope, our Funds generally hold longer-maturity bonds relative to the broad market and many of our competitors. Our bias toward long maturities was the basis for much of our significant relative outperformance in the first three quarters of 2009, though it detracted slightly from relative performance during the six-month period.
Management employed leverage in some of the Funds, through which additional exposure to the municipal market was achieved. Leverage has the impact of magnifying a Fund’s exposure to its underlying investments in both up and down markets.
As we move ahead, we recognize that many state and local governments face significant budget deficits that are driven primarily by a steep decline in tax revenues. We will continue to monitor any new developments as state and local officials formulate solutions to address these fiscal problems. As in all environments, we maintain our long-term perspective on the markets against the backdrop of relatively short periods of market volatility. We will continue to actively manage the Funds with the same income-focused, relative value approach we have always employed. We believe that this approach, which is based on credit research and decades of experience in the municipal market, will serve municipal investors well over the long term.

Fund shares are not insured by the FDIC and are not deposits or other obligations of, or guaranteed by, any depository institution. Shares are subject to investment risks, including possible loss of principal invested.
 
1   It is not possible to invest directly in an Index. The Indices’ total returns do not reflect expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Indices.
 
    Past performance is no guarantee of future results.

The views expressed throughout this report are those of the portfolio managers and are current only through the end of the period of the report as stated on the cover. These views are subject to change at any time based upon market or other conditions, and the investment adviser disclaims any responsibility to update such views. These views may not be relied on as investment advice and, because investment decisions for a fund are based on many factors, may not be relied on as an indication of trading intent on behalf of any Eaton Vance fund. Portfolio information provided in the report may not be representative of the Funds’ current or future investments and may change due to active management.

2

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
INVESTMENT UPDATE
As of February 19, 2010, Craig R. Brandon became the portfolio manager of Eaton Vance Massachusetts Municipal Bond Fund and Adam A. Weigold became the portfolio manager of Eaton Vance New Jersey Municipal Bond Fund. Mr. Brandon is a Vice President of Eaton Vance and manages other Eaton Vance municipal portfolios. He has been employed by Eaton Vance since 1998. Mr. Weigold is a Vice President of Eaton Vance and manages other Eaton Vance municipal portfolios. He has been employed by Eaton Vance since 1998.
A Note Regarding The Use Of Leverage
The Funds employ leverage through the issuance of Auction Preferred Shares (APS) and for certain funds, the use of residual interest bond (RIB) financing.1 Each Fund’s APS leverage percentage and RIB percentage leverage, if applicable, as of March 31, 2010, is reflected on the Fund-specific pages following this letter. The leverage created by APS and RIB investments provides an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of the common shares).
 
1   See Note 1H to the Financial Statements for more information on RIB investments.

3

 

Eaton Vance Municipal Bond Fund II as of March 31, 2010
PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION
Portfolio Manager: William H. Ahern, Jr., CFA
Performance1
         
NYSE Amex Symbol   EIV
Average Annual Total Returns (by market price)        
 
Six Months
     5.25 %
One Year
     28.15  
Five Years
     4.64  
Life of Fund (11/29/02)
     6.09  
         
Average Annual Total Returns (by net asset value)    
 
Six Months
     -2.43 %
One Year
     30.14  
Five Years
     2.11  
Life of Fund (11/29/02)
     4.47  
 
        
Premium/(Discount) to NAV
     11.93 %
Market Yields
         
Market Yield2
     6.99 %
Taxable-Equivalent Market Yield3
     10.75  
Index Performance4 (Average Annual Total Returns)
         
    Barclays Capital Long (22+) Municipal Bond Index  
 
Six Months
     -0.43 %
One Year
     17.35  
Five Years
     3.96  
Life of Fund (11/30/02)
     4.96  
Lipper Averages5 (Average Annual Total Returns)
         
Lipper General Municipal Debt Funds (Leveraged) Classification (by net asset value)    
 
Six Months
     0.39 %
One Year
     25.99  
Five Years
     3.83  
Life of Fund (11/30/02)
     5.19  
Rating Distribution*6
By total investments
(PIE CHART)
 
*   The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution as of 3/31/10 is as follows:
         
AAA
     32.5 %
AA
     35.7 %
A
     21.3 %
BBB
     8.5 %
CCC
     0.5 %
Not Rated
     1.5 %
Fund Statistics7
         
• Number of Issues:
     105  
• Average Maturity:
   26.1  years
• Average Effective Maturity:
   16.7  years
• Average Call Protection:
   9.0  years
• Average Dollar Price:
   $ 91.08  
• APS Leverage**:
     20.1 %
• RIB Leverage**:
     25.8 %

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or market price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. Fund performance during certain periods reflects the strong bond market performance and/or the strong performance of bonds held during those periods. This performance is not typical and may not be repeated. Bond values decline as interest rates rise. For performance as of the most recent month end, please refer to www.eatonvance.com.
 
**   APS leverage represents the liquidation value of the Fund’s Auction Preferred Shares (APS) outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and RIB Floating Rate Notes. RIB leverage represents the amount of Floating Rate Notes outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and Floating Rate Notes.
 
1   Six-month returns are cumulative. Other returns are presented on an average annual basis. Returns are historical and are calculated by determining the percentage change in market price or net asset value (as applicable) with all distributions reinvested. The Fund’s performance at market price will differ from its results at NAV. Although market price performance generally reflects investment results over time, during shorter periods, returns at market price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effects of APS outstanding and RIB investments, which are forms of investment leverage. Use of leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares). 2 The Fund’s market yield is calculated by dividing the last regular dividend per common share in the period (annualized) by the market price at the end of the period. 3 Taxable-equivalent figure assumes a maximum 35.00% federal income tax rate. A lower tax rate would result in a lower tax-equivalent figure. 4 It is not possible to invest directly in an Index. The Index’s total return does not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Index. Index performance is available as of month end only. 5 The Lipper Averages are the average annual total returns, at net asset value, of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper General Municipal Debt Funds (Leveraged) Classification (closed-end) contained 64, 62, 60 and 57 funds for the 6-month, 1-year, 5-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month end only. 6 Ratings are based on Moody’s, S&P or Fitch, as applicable. Credit ratings are based largely on the rating agency’s investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. If securities are rated differently by the rating agencies, the higher rating is applied. 7 Fund holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

4

 

Eaton Vance California Municipal Bond Fund II as of March 31, 2010
PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION
Portfolio Manager: Cynthia J. Clemson
Performance1
         
NYSE Amex Symbol   EIA
Average Annual Total Returns (by market price)        
 
Six Months
     0.90 %
One Year
     25.89  
Five Years
     2.25  
Life of Fund (11/29/02)
     4.02  
         
Average Annual Total Returns (by net asset value)    
 
Six Months
     -4.78 %
One Year
     25.30  
Five Years
     2.00  
Life of Fund (11/29/02)
     3.69  
 
        
Premium/(Discount) to NAV
     2.36 %
Market Yields
         
Market Yield2
     7.08 %
Taxable-Equivalent Market Yield3
     12.18  
Index Performance4 (Average Annual Total Returns)
                 
    Barclays Capital   Barclays Capital Long (22+)
    Municipal Bond Index   Municipal Bond Index
 
Six Months
     0.28 %     -0.43 %
One Year
     9.69       17.35  
Five Years
     4.58       3.96  
Life of Fund (11/30/02)
     4.75       4.96  
Lipper Averages5 (Average Annual Total Returns)
         
Lipper California Municipal Debt Funds Classification (by net asset value)    
 
Six Months
     -1.07 %
One Year
     22.22 %
Five Years
     3.03  
Life of Fund (11/30/02)
     4.44  
Rating Distribution*6
By total investments
(PIE CHART)
 
*   The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution as of 3/31/10 is as follows:
         
AAA
     26.6 %
AA
     42.8 %
A
     26.8 %
BBB
     2.5 %
Not Rated
     1.3 %
Fund Statistics7
         
• Number of Issues:
     64  
• Average Maturity:
   22.9  years
• Average Effective Maturity:
   15.2  years
• Average Call Protection:
   6.8  years
• Average Dollar Price:
   $ 86.08  
• APS Leverage**:
     31.6 %
• RIB Leverage**:
     11.8 %

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or market price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. Fund performance during certain periods reflects the strong bond market performance and/or the strong performance of bonds held during those periods. This performance is not typical and may not be repeated. Bond values decline as interest rates rise. For performance as of the most recent month end, please refer to www.eatonvance.com.
 
**   APS leverage represents the liquidation value of the Fund’s Auction Preferred Shares (APS) outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and RIB Floating Rate Notes. RIB leverage represents the amount of Floating Rate Notes outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and Floating Rate Notes.
 
1   Six-month returns are cumulative. Other returns are presented on an average annual basis. Returns are historical and are calculated by determining the percentage change in market price or net asset value (as applicable) with all distributions reinvested. The Fund’s performance at market price will differ from its results at NAV. Although market price performance generally reflects investment results over time, during shorter periods, returns at market price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effects of APS outstanding and RIB investments, which are forms of investment leverage. Use of leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares). 2 The Fund’s market yield is calculated by dividing the last regular dividend per common share in the period (annualized) by the market price at the end of the period. 3 Taxable-equivalent figure assumes a maximum 41.86% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. 4 It is not possible to invest directly in an Index. The Indices’ total returns do not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Indices. Index performance is available as of month end only. 5 The Lipper Averages are the average annual total returns, at net asset value, of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper California Municipal Debt Funds Classification (closed-end) contained 25, 24, 24 and 24 funds for the 6-month, 1-year, 5-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month end only. 6 Ratings are based on Moody’s, S&P or Fitch, as applicable. Credit ratings are based largely on the rating agency’s investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. If securities are rated differently by the rating agencies, the higher rating is applied. 7 Fund holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

5

 

Eaton Vance Massachusetts Municipal Bond Fund as of March 31, 2010
PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION
Portfolio Manager: Craig R. Brandon, CFA
Performance1
         
NYSE Amex Symbol   MAB
Average Annual Total Returns (by market price)        
 
Six Months
     -3.66 %
One Year
     29.09  
Five Years
     2.37  
Life of Fund (11/29/02)
     5.82  
         
Average Annual Total Returns (by net asset value)    
 
Six Months
     -2.82 %
One Year
     22.97  
Five Years
     3.84  
Life of Fund (11/29/02)
     5.37  
 
        
Premium/(Discount) to NAV
     3.13 %
Market Yields
         
Market Yield2
     5.89 %
Taxable-Equivalent Market Yield3
     9.57  
Index Performance4 (Average Annual Total Returns)
                 
    Barclays Capital   Barclays Capital Long (22+)
    Municipal Bond Index   Municipal Bond Index
 
Six Months
     0.28 %     -0.43 %
One Year
     9.69       17.35  
Five Years
     4.58       3.96  
Life of Fund (11/30/02)
     4.75       4.96  
Lipper Averages5 (Average Annual Total Returns)
         
Lipper Other States Municipal Debt Funds Classification (by net asset value)    
 
Six Months
     0.52 %
One Year
     19.03  
Five Years
     4.28  
Life of Fund (11/30/02)
     5.35  
Rating Distribution*6
By total investments
(PIE CHART)
 
*   The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution as of 3/31/10 is as follows:
         
AAA
     29.6 %
AA
    30.4 %
A
    28.0 %
BBB
    2.8 %
Not Rated
    9.2 %
Fund Statistics7
         
• Number of Issues:
     48  
• Average Maturity:
   25.3  years
• Average Effective Maturity:
   16.1  years
• Average Call Protection:
   11.4  years
• Average Dollar Price:
   $ 101.99  
• APS Leverage**:
     33.6 %
• RIB Leverage**:
     6.1 %

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or market price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. Fund performance during certain periods reflects the strong bond market performance and/or the strong performance of bonds held during those periods. This performance is not typical and may not be repeated. Bond values decline as interest rates rise. For performance as of the most recent month end, please refer to www.eatonvance.com.
 
**   APS leverage represents the liquidation value of the Fund’s Auction Preferred Shares (APS) outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and RIB Floating Rate Notes. RIB leverage represents the amount of Floating Rate Notes outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and Floating Rate Notes.
 
1   Six-month returns are cumulative. Other returns are presented on an average annual basis. Returns are historical and are calculated by determining the percentage change in market price or net asset value (as applicable) with all distributions reinvested. The Fund’s performance at market price will differ from its results at NAV. Although market price performance generally reflects investment results over time, during shorter periods, returns at market price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effects of APS outstanding and RIB investments, which are forms of investment leverage. Use of leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares). 2 The Fund’s market yield is calculated by dividing the last regular dividend per common share in the period (annualized) by the market price at the end of the period. 3 Taxable-equivalent figure assumes a maximum 38.45% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. 4 It is not possible to invest directly in an Index. The Indices’ total returns do not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Indices. Index performance is available as of month end only. 5 The Lipper Averages are the average annual total returns, at net asset value, of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Other States Municipal Debt Funds Classification (closed-end) contained 45, 45, 45 and 45 funds for the 6-month, 1-year, 5-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month end only. 6 Ratings are based on Moody’s, S&P or Fitch, as applicable. Credit ratings are based largely on the rating agency’s investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. If securities are rated differently by the rating agencies, the higher rating is applied. 7 Fund holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

6

 

Eaton Vance Michigan Municipal Bond Fund as of March 31, 2010
PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION
Portfolio Manager: William H. Ahern, Jr., CFA
Performance1
         
NYSE Amex Symbol   MIW
Average Annual Total Returns (by market price)        
 
Six Months
     5.20 %
One Year
     40.59  
Five Years
     2.45  
Life of Fund (11/29/02)
     5.73  
         
Average Annual Total Returns (by net asset value)    
 
Six Months
     -1.94 %
One Year
     21.16  
Five Years
     4.61  
Life of Fund (11/29/02)
     5.56  
 
        
Premium/(Discount) to NAV
     1.24 %
Market Yields
         
Market Yield2
     6.21 %
Taxable-Equivalent Market Yield3
     9.99  
Index Performance4 (Average Annual Total Returns)
                 
    Barclays Capital   Barclays Capital Long (22+)
    Municipal Bond Index   Municipal Bond Index
 
Six Months
     0.28 %     -0.43 %
One Year
     9.69       17.35  
Five Years
     4.58       3.96  
Life of Fund (11/30/02)
     4.75       4.96  
Lipper Averages5 (Average Annual Total Returns)
         
Lipper Michigan Municipal Debt Funds Classification (by net asset value)    
 
Six Months
     -1.02 %
One Year
     17.82  
Five Years
     3.84  
Life of Fund (11/30/02)
     5.06  
Rating Distribution*6
By total investments
(PIE CHART)
 
*   There were no special purpose vehicles in which the Fund held a residual interest as of 3/31/10.
Fund Statistics
         
• Number of Issues:
     40  
• Average Maturity:
   20.4  years
• Average Effective Maturity:
   10.9  years
• Average Call Protection:
   6.0  years
• Average Dollar Price:
   $ 92.12  
• APS Leverage**:
     38.7 %

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or market price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. Fund performance during certain periods reflects the strong bond market performance and/or the strong performance of bonds held during those periods. This performance is not typical and may not be repeated. Bond values decline as interest rates rise. For performance as of the most recent month end, please refer to www.eatonvance.com.
 
**   APS leverage represents the liquidation value of the Fund’s Auction Preferred Shares (APS) outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS.
 
1   Six-month returns are cumulative. Other returns are presented on an average annual basis. Returns are historical and are calculated by determining the percentage change in market price or net asset value (as applicable) with all distributions reinvested. The Fund’s performance at market price will differ from its results at NAV. Although market price performance generally reflects investment results over time, during shorter periods, returns at market price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effects of APS outstanding, which is a form of investment leverage. Use of leverage creates an opportunity for income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares). 2 The Fund’s market yield is calculated by dividing the last regular dividend per common share in the period (annualized) by the market price at the end of the period. 3 Taxable-equivalent figure assumes a maximum 37.83% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. 4 It is not possible to invest directly in an Index. The Indices’ total returns do not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Indices. Index performance is available as of month end only. 5 The Lipper Averages are the average annual total returns, at net asset value, of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Michigan Municipal Debt Funds Classification (closed-end) contained 5, 5, 5 and 5 funds for the 6-month, 1-year, 5-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month end only. 6 Ratings are based on Moody’s, S&P or Fitch, as applicable. Credit ratings are based largely on the rating agency’s investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. If securities are rated differently by the rating agencies, the higher rating is applied.

7

 

Eaton Vance New Jersey Municipal Bond Fund as of March 31, 2010
PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION
Portfolio Manager: Adam A. Weigold, CFA
Performance1
         
NYSE Amex Symbol   EMJ
Average Annual Total Returns (by market price)        
 
Six Months
     7.67 %
One Year
     36.38  
Five Years
     6.60  
Life of Fund (11/29/02)
     7.54  
         
Average Annual Total Returns (by net asset value)    
 
Six Months
     -2.95 %
One Year
     27.51  
Five Years
     4.38  
Life of Fund (11/29/02)
     5.92  
 
        
Premium/(Discount) to NAV
     11.79 %
Market Yields
         
Market Yield2
     5.99 %
Taxable-Equivalent Market Yield3
     10.33  
Index Performance4 (Average Annual Total Returns)
                 
    Barclays Capital   Barclays Capital Long (22+)
    Municipal Bond Index   Municipal Bond Index
 
Six Months
     0.28 %     -0.43 %
One Year
     9.69       17.35  
Five Years
     4.58       3.96  
Life of Fund (11/30/02)
     4.75       4.96  
Lipper Averages5 (Average Annual Total Returns)
         
Lipper New Jersey Municipal Debt Funds Classification (by net asset value)    
 
Six Months
     -0.07 %
One Year
     23.90  
Five Years
     4.18  
Life of Fund (11/30/02)
     5.56  
Rating Distribution*6
By total investments
(PIE CHART)
 
*   The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution as of 3/31/10 is as follows:
         
AAA
     29.0 %
AA
     43.3 %
A
     19.2 %
BBB
     8.5 %
Fund Statistics7
         
• Number of Issues:
     62  
• Average Maturity:
   22.3  years
• Average Effective Maturity:
   14.3  years
• Average Call Protection:
   10.5  years
• Average Dollar Price:
   $ 88.68  
• APS Leverage**:
     31.9 %
• RIB Leverage**:
     10.3 %

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or market price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. Fund performance during certain periods reflects the strong bond market performance and/or the strong performance of bonds held during those periods. This performance is not typical and may not be repeated. Bond values decline as interest rates rise. For performance as of the most recent month end, please refer to www.eatonvance.com.
 
**   APS leverage represents the liquidation value of the Fund’s Auction Preferred Shares (APS) outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and RIB Floating Rate Notes. RIB leverage represents the amount of Floating Rate Notes outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and Floating Rate Notes.
 
1   Six-month returns are cumulative. Other returns are presented on an average annual basis. Returns are historical and are calculated by determining the percentage change in market price or net asset value (as applicable) with all distributions reinvested. The Fund’s performance at market price will differ from its results at NAV. Although market price performance generally reflects investment results over time, during shorter periods, returns at market price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effects of APS outstanding and RIB investments, which are forms of investment leverage. Use of leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares). 2 The Fund’s market yield is calculated by dividing the last regular dividend per common share in the period (annualized) by the market price at the end of the period. 3 Taxable-equivalent figure assumes a maximum 41.99% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. 4 It is not possible to invest directly in an Index. The Indices’ total returns do not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Indices. Index performance is available as of month end only. 5 The Lipper Averages are the average annual total returns, at net asset value, of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper New Jersey Municipal Debt Funds Classification (closed-end) contained 12, 11, 11 and 11 funds for the 6-month, 1-year, 5-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month end only. 6 Ratings are based on Moody’s, S&P or Fitch, as applicable. Credit ratings are based largely on the rating agency’s investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. If securities are rated differently by the rating agencies, the higher rating is applied. 7 Fund holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

8

 

Eaton Vance New York Municipal Bond Fund II as of March 31, 2010
PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION
Portfolio Manager: Craig R. Brandon, CFA
Performance1
         
NYSE Amex Symbol   NYH
Average Annual Total Returns (by market price)        
 
Six Months
     5.56 %
One Year
     35.43  
Five Years
     5.59  
Life of Fund (11/29/02)
     6.31  
         
Average Annual Total Returns (by net asset value)    
 
Six Months
     -1.74 %
One Year
     29.22  
Five Years
     3.43  
Life of Fund (11/29/02)
     5.29  
 
        
Premium/(Discount) to NAV
     7.34 %
Market Yields
         
Market Yield2
     6.35 %
Taxable-Equivalent Market Yield3
     10.73  
Index Performance4 (Average Annual Total Returns)
                 
    Barclays Capital   Barclays Capital Long (22+)
    Municipal Bond Index   Municipal Bond Index
 
Six Months
     0.28 %     -0.43 %
One Year
     9.69       17.35  
Five Years
     4.58       3.96  
Life of Fund (11/30/02)
     4.75       4.96  
Lipper Averages5 (Average Annual Total Returns)
         
Lipper New York Municipal Debt Funds Classification (by net asset value)    
 
Six Months
     1.02 %
One Year
     22.22  
Five Years
     3.51  
Life of Fund (11/30/02)
     4.92  
Rating Distribution*6
By total investments
(PIE CHART)
 
*   The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution as of 3/31/10 is as follows:
         
AAA
     23.2 %
AA
     42.1 %
A
     23.8 %
BBB
     8.5 %
Not Rated
     2.4 %
Fund Statistics7
         
• Number of Issues:
     72  
• Average Maturity:
   23.4  years
• Average Effective Maturity:
   13.7  years
• Average Call Protection:
   8.7  years
• Average Dollar Price:
   $ 94.43  
• APS Leverage**:
     23.0 %
• RIB Leverage**:
     19.6 %

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or market price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. Fund performance during certain periods reflects the strong bond market performance and/or the strong performance of bonds held during those periods. This performance is not typical and may not be repeated. Bond values decline as interest rates rise. For performance as of the most recent month end, please refer to www.eatonvance.com.
 
**   APS leverage represents the liquidation value of the Fund’s Auction Preferred Shares (APS) outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and RIB Floating Rate Notes. RIB leverage represents the amount of Floating Rate Notes outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and Floating Rate Notes.
 
1   Six-month returns are cumulative. Other returns are presented on an average annual basis. Returns are historical and are calculated by determining the percentage change in market price or net asset value (as applicable) with all distributions reinvested. The Fund’s performance at market price will differ from its results at NAV. Although market price performance generally reflects investment results over time, during shorter periods, returns at market price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effects of APS outstanding and RIB investments, which are forms of investment leverage. Use of leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares). 2 The Fund’s market yield is calculated by dividing the last regular dividend per common share in the period (annualized) by the market price at the end of the period. 3 Taxable-equivalent figure assumes a maximum 40.83% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. 4 It is not possible to invest directly in an Index. The Indices’ total returns do not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Indices. Index performance is available as of month end only. 5 The Lipper Averages are the average annual total returns, at net asset value, of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper New York Municipal Debt Funds Classification (closed-end) contained 19, 18, 18 and 19 funds for the 6-month, 1-year, 5-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month end only. 6 Ratings are based on Moody’s, S&P or Fitch, as applicable. Credit ratings are based largely on the rating agency’s investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. If securities are rated differently by the rating agencies, the higher rating is applied. 7 Fund holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

9

 

Eaton Vance Ohio Municipal Bond Fund as of March 31, 2010
PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION
Portfolio Manager: William H. Ahern, Jr., CFA
Performance1
         
NYSE Amex Symbol   EIO
Average Annual Total Returns (by market price)        
 
Six Months
     4.53 %
One Year
     34.72  
Five Years
     3.15  
Life of Fund (11/29/02)
     4.77  
         
Average Annual Total Returns (by net asset value)    
 
Six Months
     -1.71 %
One Year
     27.96  
Five Years
     1.94  
Life of Fund (11/29/02)
     3.61  
 
        
Premium/(Discount) to NAV
     8.56 %
Market Yields
         
Market Yield2
     5.74 %
Taxable-Equivalent Market Yield3
     9.42  
Index Performance4 (Average Annual Total Returns)
                 
    Barclays Capital   Barclays Capital Long (22+)
    Municipal Bond Index   Municipal Bond Index
 
Six Months
     0.28 %     -0.43 %
One Year
     9.69       17.35  
Five Years
     4.58       3.96  
Life of Fund (11/30/02)
     4.75       4.96  
Lipper Averages5 (Average Annual Total Returns)
         
Lipper Other States Municipal Debt Funds Classification (by net asset value)    
 
Six Months
     0.52 %
One Year
     19.03  
Five Years
     4.28  
Life of Fund (11/30/02)
     5.35  
Rating Distribution*6
By total investments
(PIE CHART)
 
*   The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution as of 3/31/10 is as follows:
         
AAA
     37.5 %
AA
     20.8 %
A
     32.2 %
BBB
     3.6 %
Not Rated
     5.9 %
Fund Statistics7
         
• Number of Issues:
     55  
• Average Maturity:
   22.0  years
• Average Effective Maturity:
   13.5  years
• Average Call Protection:
   8.4  years
• Average Dollar Price:
   $ 89.03  
• APS Leverage**:
     33.6 %
• RIB Leverage**:
     4.6 %

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or market price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. Fund performance during certain periods reflects the strong bond market performance and/or the strong performance of bonds held during those periods. This performance is not typical and may not be repeated. Bond values decline as interest rates rise. For performance as of the most recent month end, please refer to www.eatonvance.com.
 
**   APS leverage represents the liquidation value of the Fund’s Auction Preferred Shares (APS) outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and RIB Floating Rate Notes. RIB leverage represents the amount of Floating Rate Notes outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and Floating Rate Notes. Floating Rate Notes in both calculations reflect the effect of RIBs purchased in secondary market transactions.
 
1   Six-month returns are cumulative. Other returns are presented on an average annual basis. Returns are historical and are calculated by determining the percentage change in market price or net asset value (as applicable) with all distributions reinvested. The Fund’s performance at market price will differ from its results at NAV. Although market price performance generally reflects investment results over time, during shorter periods, returns at market price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effects of APS outstanding and RIB investments, which are forms of investment leverage. Use of leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares). 2 The Fund’s market yield is calculated by dividing the last regular dividend per common share in the period (annualized) by the market price at the end of the period. 3 Taxable-equivalent figure assumes a maximum 39.06% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. 4 It is not possible to invest directly in an Index. The Indices’ total returns do not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Indices. Index performance is available as of month end only. 5 The Lipper Averages are the average annual total returns, at net asset value, of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Other States Municipal Debt Funds Classification (closed-end) contained 45, 45, 45 and 45 funds for the 6-month, 1-year, 5-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month end only. 6 Ratings are based on Moody’s, S&P or Fitch, as applicable. Credit ratings are based largely on the rating agency’s investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. If securities are rated differently by the rating agencies, the higher rating is applied. 7 Fund holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

10

 

Eaton Vance Pennsylvania Municipal Bond Fund as of March 31, 2010
PERFORMANCE INFORMATION AND PORTFOLIO COMPOSITION
Portfolio Manager: Adam A. Weigold, CFA
Performance1
         
NYSE Amex Symbol   EIP
Average Annual Total Returns (by market price)        
 
Six Months
     -2.79 %
One Year
     28.46  
Five Years
     4.84  
Life of Fund (11/29/02)
     6.03  
         
Average Annual Total Returns (by net asset value)    
 
Six Months
     -4.28 %
One Year
     26.06  
Five Years
     4.16  
Life of Fund (11/29/02)
     5.10  
 
        
Premium/(Discount) to NAV
     6.67 %
Market Yields
         
Market Yield2
     6.13 %
Taxable-Equivalent Market Yield3
     9.73  
Index Performance4 (Average Annual Total Returns)
                 
    Barclays Capital   Barclays Capital Long (22+)
    Municipal Bond Index   Municipal Bond Index
 
Six Months
     0.28 %     -0.43 %
One Year
     9.69       17.35  
Five Years
     4.58       3.96  
Life of Fund (11/30/02)
     4.75       4.96  
Lipper Averages5 (Average Annual Total Returns)
         
Lipper Pennsylvania Municipal Debt Funds Classification (by net asset value)    
 
Six Months
     0.01 %
One Year
     22.40 %
Five Years
     3.81  
Life of Fund (11/30/02)
     5.00  
Rating Distribution*6
By total investments
(PIE CHART)
 
*   The rating distribution presented above includes the ratings of securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements. Absent such securities, the Fund’s rating distribution as of 3/31/10 is as follows:
         
AAA
     23.0 %
AA
     27.2 %
A
     32.4 %
BBB
     3.5 %
Not Rated
     13.9 %
Fund Statistics7
         
• Number of Issues:
     62  
• Average Maturity:
   22.2  years
• Average Effective Maturity:
   14.4  years
• Average Call Protection:
   8.9  years
• Average Dollar Price:
   $ 91.99  
• APS Leverage**:
     34.7 %
• RIB Leverage**:
     4.6 %

Past performance is no guarantee of future results. Returns are historical and are calculated by determining the percentage change in net asset value or market price (as applicable) with all distributions reinvested. Investment return and principal value will fluctuate so that shares, when sold, may be worth more or less than their original cost. Performance is for the stated time period only; due to market volatility, the Fund’s current performance may be lower or higher than the quoted return. Fund performance during certain periods reflects the strong bond market performance and/or the strong performance of bonds held during those periods. This performance is not typical and may not be repeated. Bond values decline as interest rates rise. For performance as of the most recent month end, please refer to www.eatonvance.com.
 
**   APS leverage represents the liquidation value of the Fund’s Auction Preferred Shares (APS) outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and RIB Floating Rate Notes. RIB leverage represents the amount of Floating Rate Notes outstanding as of 3/31/10 as a percentage of the Fund’s net assets applicable to common shares plus APS and Floating Rate Notes.
 
1   Six-month returns are cumulative. Other returns are presented on an average annual basis. Returns are historical and are calculated by determining the percentage change in market price or net asset value (as applicable) with all distributions reinvested. The Fund’s performance at market price will differ from its results at NAV. Although market price performance generally reflects investment results over time, during shorter periods, returns at market price can also be affected by factors such as changing perceptions about the Fund, market conditions, fluctuations in supply and demand for the Fund’s shares, or changes in Fund distributions. Performance results reflect the effects of APS outstanding and RIB investments, which are forms of investment leverage. Use of leverage creates an opportunity for increased income but, at the same time, creates special risks (including the likelihood of greater volatility of net asset value and market price of common shares). 2 The Fund’s market yield is calculated by dividing the last regular dividend per common share in the period (annualized) by the market price at the end of the period. 3 Taxable-equivalent figure assumes a maximum 37.00% combined federal and state income tax rate. A lower tax rate would result in a lower tax-equivalent figure. 4 It is not possible to invest directly in an Index. The Indices’ total returns do not reflect the expenses that would have been incurred if an investor individually purchased or sold the securities represented in the Indices. Index performance is available as of month end only. 5 The Lipper Averages are the average annual total returns, at net asset value, of the funds that are in the same Lipper Classification as the Fund. It is not possible to invest in a Lipper Classification. Lipper Classifications may include insured and uninsured funds, as well as leveraged and unleveraged funds. The Lipper Pennsylvania Municipal Debt Funds Classification (closed-end) contained 9, 8, 8 and 8 funds for the 6-month, 1-year, 5-year and Life-of-Fund periods, respectively. Lipper Averages are available as of month end only. 6 Ratings are based on Moody’s, S&P or Fitch, as applicable. Credit ratings are based largely on the rating agency’s investment analysis at the time of rating and the rating assigned to any particular security is not necessarily a reflection of the issuer’s current financial condition. The rating assigned to a security by a rating agency does not necessarily reflect its assessment of the volatility of a security’s market value or of the liquidity of an investment in the security. If securities are rated differently by the rating agencies, the higher rating is applied. 7 Fund holdings information excludes securities held by special purpose vehicles in which the Fund holds a residual interest. See Note 1H to the Fund’s financial statements.

11

 

Eaton Vance Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
                     
Tax-Exempt Investments — 183.9%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Electric Utilities — 0.6%
 
$ 1,600     Sabine River Authority, TX, (TXU Energy Co. LLC), 5.20%, 5/1/28   $ 771,888      
 
 
            $ 771,888      
 
 
 
 
General Obligations — 3.0%
 
$ 3,500     New York, NY, 5.25%, 1/15/33(1)   $ 3,586,100      
 
 
            $ 3,586,100      
 
 
 
 
Hospital — 5.5%
 
$ 60     Camden County, NJ, Improvement Authority, (Cooper Health System), 5.00%, 2/15/25   $ 53,603      
  900     Camden County, NJ, Improvement Authority, (Cooper Health System), 5.00%, 2/15/35     741,249      
  750     Camden County, NJ, Improvement Authority, (Cooper Health System), 5.25%, 2/15/27     677,497      
  500     Hawaii Department of Budget and Finance, (Hawaii Pacific Health), 5.60%, 7/1/33     500,100      
  1,285     Highlands County, FL, Health Facilities Authority, (Adventist Health System), 5.25%, 11/15/36     1,288,482      
  1,850     Knox County, TN, Health, Educational and Housing Facilities Board, (Covenant Health), 0.00%, 1/1/38     334,961      
  5,000     Knox County, TN, Health, Educational and Housing Facilities Board, (Covenant Health), 0.00%, 1/1/39     852,200      
  960     Lehigh County, PA, General Purpose Authority, (Lehigh Valley Health Network), 5.25%, 7/1/32     953,693      
  1,440     Michigan Hospital Finance Authority, (Henry Ford Health System), 5.00%, 11/15/38     1,258,258      
 
 
            $ 6,660,043      
 
 
 
 
Industrial Development Revenue — 7.7%
 
$ 4,750     Liberty Development Corp., NY, (Goldman Sachs Group, Inc.), 5.25%, 10/1/35(1)   $ 4,810,382      
  4,790     St. John Baptist Parish, LA, (Marathon Oil Corp.), 5.125%, 6/1/37     4,517,257      
 
 
            $ 9,327,639      
 
 
 
 
Insured-Electric Utilities — 11.9%
 
$ 1,000     American Municipal Power-Ohio, Inc., OH, (Prairie State Energy), (AGC), 5.75%, 2/15/39   $ 1,061,240      
  12,430     Chelan County, WA, Public Utility District No. 1, (Columbia River), (NPFG), 0.00%, 6/1/23     6,514,190      
  2,900     JEA, FL, Electric System Revenue, (AGM), 5.00%, 10/1/34     2,900,696      
  2,400     Mississippi Development Bank, (Municipal Energy), (XLCA), 5.00%, 3/1/41     2,173,104      
  1,595     South Carolina Public Service Authority, (Santee Cooper), (BHAC), 5.50%, 1/1/38     1,728,996      
 
 
            $ 14,378,226      
 
 
 
 
Insured-Escrowed / Prerefunded — 0.1%
 
$ 35     Highlands County, FL, Health Facilities Authority, (Adventist Health System), (BHAC), Prerefunded to 11/15/16, 5.25%, 11/15/36   $ 41,085      
  82     Highlands County, FL, Health Facilities Authority, (Adventist Health System), (BHAC), Prerefunded to 11/15/16, 5.25%, 11/15/36(1)     95,691      
 
 
            $ 136,776      
 
 
 
 
Insured-General Obligations — 19.6%
 
$ 2,300     Butler County, KS, Unified School District No. 394, (AGM), 3.50%, 9/1/24   $ 2,251,930      
  12,165     Chabot-Las Positas, CA, Community College District, (AMBAC), 0.00%, 8/1/43     1,311,995      
  17,000     Coast Community College District, CA, (Election of 2002), (AGM), 0.00%, 8/1/33     3,856,280      
  2,765     District of Columbia, (FGIC), (NPFG), 4.75%, 6/1/33     2,779,848      
  1,500     Goodyear, AZ, (NPFG), 3.00%, 7/1/26     1,318,680      
  2,000     Los Angeles, CA, Unified School District, (AGC), 5.00%, 1/1/34     2,023,480      
  2,750     Palm Springs, CA, Unified School District, (Election of 2008), (AGC), 5.00%, 8/1/33     2,830,438      
  1,250     Philadelphia, PA, (AGC), 7.00%, 7/15/28     1,433,400      
  5,500     Washington, (AGM), 5.00%, 7/1/25(1)     5,860,305      
 
 
            $ 23,666,356      
 
 
 
 
Insured-Hospital — 27.8%
 
$ 1,750     Arizona Health Facilities Authority, (Banner Health), (BHAC), 5.375%, 1/1/32   $ 1,820,088      
  1,500     California Statewide Communities Development Authority, (Sutter Health), (AGM), 5.05%, 8/15/38(1)     1,508,055      
  1,695     Centre County, PA, Hospital Authority, (Mount Nittany Medical Center), (AGC), 6.125%, 11/15/39     1,764,275      
  450     Centre County, PA, Hospital Authority, (Mount Nittany Medical Center), (AGC), 6.25%, 11/15/44     468,036      
  2,200     Colorado Health Facilities Authority, (Catholic Health), (AGM), 5.10%, 10/1/41(1)     2,207,128      
  3,418     Highlands County, FL, Health Facilities Authority, (Adventist Health System), (BHAC), 5.25%, 11/15/36(1)     3,491,055      
  1,485     Highlands County, FL, Health Facilities Authority, (Adventist Health System), (BHAC), 5.25%, 11/15/36     1,516,527      

 
See notes to financial statements

12

 

 
Eaton Vance Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
Insured-Hospital (continued)
 
                     
$ 1,490     Highlands County, FL, Health Facilities Authority, (Adventist Health System), (NPFG), 5.00%, 11/15/35   $ 1,450,038      
  2,500     Illinois Finance Authority, (Children’s Memorial Hospital), (AGC), 5.25%, 8/15/47(1)     2,500,174      
  2,500     Indiana Health and Educational Facility Finance Authority, (Sisters of St. Francis Health Services), (AGM), 5.25%, 5/15/41(1)     2,551,025      
  2,090     Maricopa County, AZ, Industrial Development Authority, (Catholic Healthcare West), (BHAC), 5.25%, 7/1/32     2,153,306      
  1,000     New Jersey Health Care Facilities Financing Authority, (Hackensack University Medical Center), (AGC), 5.25%, 1/1/36(1)     1,025,510      
  1,385     New Jersey Health Care Facilities Financing Authority, (Meridian Health Center), Series II, (AGC), 5.00%, 7/1/38     1,394,196      
  500     New Jersey Health Care Facilities Financing Authority, (Meridian Health Center), Series V, (AGC), 5.00%, 7/1/38(1)     503,320      
  2,245     New Jersey Health Care Facilities Financing Authority, (Virtua Health), (AGC), 5.50%, 7/1/38     2,364,524      
  2,750     New York Dormitory Authority, (Health Quest Systems), (AGC), 5.125%, 7/1/37(1)     2,809,042      
  1,545     Washington Health Care Facilities Authority, (MultiCare Health System), (AGC), 6.00%, 8/15/39     1,644,390      
  2,300     Washington Health Care Facilities Authority, (Providence Health Care), (AGM), 5.25%, 10/1/33     2,375,923      
 
 
            $ 33,546,612      
 
 
 
 
Insured-Industrial Development Revenue — 1.1%
 
$ 1,340     Pennsylvania Economic Development Financing Authority, (Aqua Pennsylvania Inc. Project), (BHAC), 5.00%, 10/1/39   $ 1,375,684      
 
 
            $ 1,375,684      
 
 
 
 
Insured-Lease Revenue / Certificates of Participation — 9.1%
 
$ 1,000     Essex County, NJ, Improvement Authority, (NPFG), 5.50%, 10/1/30   $ 1,121,480      
  4,600     Hudson Yards Infrastructure Corp., NY, (NPFG), 4.50%, 2/15/47     3,987,740      
  875     New Jersey Economic Development Authority, (School Facilities Construction), (AGC), 5.50%, 12/15/34     953,435      
  3,250     San Diego County, CA, Water Authority, Certificates of Participation, (AGM), 5.00%, 5/1/38(1)     3,308,240      
  1,500     Tri-Creek Middle School Building Corp., IN, (AGM), 5.25%, 1/15/34(1)     1,565,415      
 
 
            $ 10,936,310      
 
 
 
Insured-Other Revenue — 3.1%
 
$ 2,540     Harris County-Houston, TX, Sports Authority, (NPFG), 0.00%, 11/15/34   $ 467,893      
  2,185     Massachusetts Development Finance Agency, (100 Cambridge Street Redevelopment), (NPFG), 5.125%, 2/1/34     2,110,492      
  1,000     New York, NY, Industrial Development Agency, (Yankee Stadium), (AGC), 7.00%, 3/1/49     1,151,430      
 
 
            $ 3,729,815      
 
 
 
 
Insured-Private Education — 5.4%
 
$ 2,000     Massachusetts Development Finance Agency, (Boston University), (AMBAC), (BHAC), 5.00%, 10/1/35   $ 2,045,320      
  2,500     Massachusetts Development Finance Agency, (Boston University), (XLCA), 6.00%, 5/15/59     2,798,125      
  1,555     Miami-Dade County, FL, Educational Facilities Authority, (University of Miami), (AMBAC), (BHAC), 5.00%, 4/1/31     1,597,483      
 
 
            $ 6,440,928      
 
 
 
 
Insured-Public Education — 3.3%
 
$ 3,900     University of South Alabama, (BHAC), 5.00%, 8/1/38   $ 4,012,164      
 
 
            $ 4,012,164      
 
 
 
 
Insured-Solid Waste — 1.0%
 
$ 740     Palm Beach County, FL, Solid Waste Authority, (BHAC), 5.00%, 10/1/24   $ 795,892      
  425     Palm Beach County, FL, Solid Waste Authority, (BHAC), 5.00%, 10/1/26     452,438      
 
 
            $ 1,248,330      
 
 
 
 
Insured-Special Tax Revenue — 13.4%
 
$ 5,350     Metropolitan Pier and Exposition Authority, IL, (McCormick Place Expansion), (NPFG), 0.00%, 12/15/34   $ 1,221,138      
  4,000     Metropolitan Pier and Exposition Authority, IL, (McCormick Place Expansion), (NPFG), 5.25%, 6/15/42(2)     4,045,480      
  3,000     Miami-Dade County, FL, Professional Sports Franchise Facilities, (AGC), 0.00%, 10/1/39     1,811,130      
  2,500     New York Convention Center Development Corp., Hotel Occupancy Tax, (AMBAC), 4.75%, 11/15/45     2,352,925      
  2,060     New York Convention Center Development Corp., Hotel Occupancy Tax, (AMBAC), 5.00%, 11/15/44     2,023,270      
  29,695     Puerto Rico Sales Tax Financing Corp., (AMBAC), 0.00%, 8/1/54     1,770,119      
  6,075     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/44     740,239      

 
See notes to financial statements

13

 

 
Eaton Vance Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
Insured-Special Tax Revenue (continued)
 
                     
$ 12,035     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45   $ 1,362,723      
  7,595     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/46     795,880      
 
 
            $ 16,122,904      
 
 
 
 
Insured-Student Loan — 2.1%
 
$ 2,395     Maine Educational Loan Authority, (AGC), 5.625%, 12/1/27   $ 2,489,531      
 
 
            $ 2,489,531      
 
 
 
 
Insured-Transportation — 28.4%
 
$ 1,585     Clark County, NV, (Las Vegas-McCarran International Airport), (AGM), 5.25%, 7/1/39   $ 1,605,383      
  7,800     E-470 Public Highway Authority, CO, (NPFG), 0.00%, 9/1/22     3,627,000      
  1,305     Manchester, NH, (Manchester-Boston Regional Airport), (AGM), 5.125%, 1/1/30     1,319,107      
  10,000     Maryland Transportation Authority, (AGM), 5.00%, 7/1/41(1)     10,527,400      
  1,000     Metropolitan Washington, D.C., Airports Authority, (BHAC), 5.00%, 10/1/24     1,082,910      
  535     Metropolitan Washington, D.C., Airports Authority, (BHAC), 5.00%, 10/1/29     560,974      
  4,260     Minneapolis and St. Paul, MN, Metropolitan Airports Commission, (FGIC), (NPFG), 4.50%, 1/1/32     4,184,300      
  13,885     Nevada Department of Business and Industry, (Las Vegas Monorail -1st Tier), (AMBAC), 0.00%, 1/1/20     2,463,893      
  1,040     New Jersey Transportation Trust Fund Authority, (AGC), 5.50%, 12/15/38     1,130,542      
  255     North Carolina Turnpike Authority, (Triangle Expressway System), (AGC), 5.50%, 1/1/29     272,116      
  290     North Carolina Turnpike Authority, (Triangle Expressway System), (AGC), 5.75%, 1/1/39     308,833      
  1,750     North Texas Tollway Authority, (BHAC), 5.75%, 1/1/48     1,847,702      
  5,555     Texas Turnpike Authority, (Central Texas Turnpike System), (AMBAC), 5.00%, 8/15/42     5,281,583      
 
 
            $ 34,211,743      
 
 
 
 
Insured-Water and Sewer — 14.9%
 
$ 1,490     Atlanta, GA, Water and Wastewater, (NPFG), 5.00%, 11/1/39   $ 1,434,304      
  670     Bossier City, LA, Utilities Revenue, (BHAC), 5.25%, 10/1/26     725,831      
  420     Bossier City, LA, Utilities Revenue, (BHAC), 5.25%, 10/1/27     452,806      
  660     Bossier City, LA, Utilities Revenue, (BHAC), 5.50%, 10/1/38     703,791      
  1,910     Chicago, IL, Wastewater Transmission Revenue, (BHAC), 5.50%, 1/1/38     2,027,255      
  1,250     District of Columbia Water and Sewer Authority, (AGC), 5.00%, 10/1/34(1)     1,269,900      
  435     Houston, TX, Utility System, (AGM), (BHAC), 5.00%, 11/15/33     449,446      
  2,205     New York, NY, Municipal Water Finance Authority, (BHAC), 5.75%, 6/15/40     2,488,960      
  10,145     Pearland, TX, Waterworks and Sewer Systems, (NPFG), 3.50%, 9/1/31     8,368,205      
 
 
            $ 17,920,498      
 
 
 
 
Insured-Water Revenue — 21.6%
 
$ 7,000     Contra Costa, CA, Water District, (AGM), 5.00%, 10/1/32(1)   $ 7,090,031      
  5,500     Los Angeles, CA, Department of Water and Power, (BHAC), (FGIC), 5.00%, 7/1/43(1)     5,533,880      
  1,000     Massachusetts Water Resources Authority, (AGM), 5.25%, 8/1/35     1,120,760      
  6,110     Massachusetts Water Resources Authority, (AMBAC), 4.00%, 8/1/40     5,395,069      
  6,750     Metropolitan Water District, CA, Water and Sewer Systems, (BHAC), (FGIC), 5.00%, 10/1/36(1)     6,881,153      
 
 
            $ 26,020,893      
 
 
 
 
Private Education — 1.3%
 
$ 1,000     Massachusetts Health and Educational Facilities Authority, (Harvard University), 5.50%, 11/15/36   $ 1,112,670      
  440     New York Dormitory Authority, (Rockefeller University), 5.00%, 7/1/40     465,168      
 
 
            $ 1,577,838      
 
 
 
 
Public Education — 1.3%
 
$ 1,500     University of Virginia, 5.00%, 6/1/40(3)   $ 1,581,615      
 
 
            $ 1,581,615      
 
 
 
 
Transportation — 0.8%
 
$ 420     Orlando-Orange County, FL, Expressway Authority, 5.00%, 7/1/35   $ 426,367      
  505     Orlando-Orange County, FL, Expressway Authority, 5.00%, 7/1/40     511,429      
 
 
            $ 937,796      
 
 
 

 
See notes to financial statements

14

 

 
Eaton Vance Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Water and Sewer — 0.9%
 
$ 205     Marco Island, FL, Utility System, 5.00%, 10/1/34(4)   $ 205,000      
  910     Marco Island, FL, Utility System, 5.00%, 10/1/40(4)     907,170      
 
 
            $ 1,112,170      
 
 
     
Total Tax-Exempt Investments — 183.9%
   
(identified cost $230,365,667)
  $ 221,791,859      
 
 
                     
                     
Short-Term Investments — 1.4%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
$ 1,694     State Street Bank and Trust Euro Time Deposit, 0.01%, 4/1/10   $ 1,694,494      
 
 
     
Total Short-Term Investments — 1.4%
   
(identified cost $1,694,494)
  $ 1,694,494      
 
 
     
Total Investments — 185.3%
   
(identified cost $232,060,161)
  $ 223,486,353      
 
 
             
Auction Preferred Shares Plus Cumulative Unpaid Dividends — (37.1)%
  $ (44,703,356 )    
 
 
             
Other Assets, Less Liabilities — (48.2)%
  $ (58,166,574 )    
 
 
             
Net Assets Applicable to Common Shares — 100.0%
  $ 120,616,423      
 
 
 
The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.
 
AGC - Assured Guaranty Corp.
 
AGM - Assured Guaranty Municipal Corp.
 
AMBAC - AMBAC Financial Group, Inc.
 
BHAC - Berkshire Hathaway Assurance Corp.
 
FGIC - Financial Guaranty Insurance Company
 
NPFG - National Public Finance Guaranty Corp.
 
XLCA - XL Capital Assurance, Inc.
 
At March 31, 2010, the concentration of the Fund’s investments in the various states, determined as a percentage of total investments, is as follows:
 
         
California
    15.4%  
New York
    10.6%  
Others, representing less than 10% individually
    74.0%  
 
The Fund invests primarily in debt securities issued by municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at March 31, 2010, 87.8% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 2.2% to 22.6% of total investments.
 
(1) Security represents the underlying municipal bond of an inverse floater (see Note 1H).
 
(2) Security (or a portion thereof) has been segregated to cover payable for when-issued securities.
 
(3) Security (or a portion thereof) has been pledged to cover margin requirements on open financial futures contracts.
 
(4) When-issued security.

 
See notes to financial statements

15

 

Eaton Vance California Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
                     
Tax-Exempt Investments — 176.5%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Electric Utilities — 1.5%
 
$ 675     Vernon, Electric System Revenue, 5.125%, 8/1/21   $ 700,718      
 
 
            $ 700,718      
 
 
 
 
Hospital — 15.1%
 
$ 1,330     California Health Facilities Financing Authority, (Catholic Healthcare West), 5.625%, 7/1/32   $ 1,353,115      
  1,445     California Health Facilities Financing Authority, (Cedars-Sinai Medical Center), 5.00%, 11/15/34     1,393,384      
  1,475     California Statewide Communities Development Authority, (Huntington Memorial Hospital), 5.00%, 7/1/35     1,386,338      
  500     California Statewide Communities Development Authority, (John Muir Health), 5.00%, 8/15/36     476,745      
  1,900     California Statewide Communities Development Authority, (Kaiser Permanente), 5.25%, 3/1/45     1,835,096      
  555     Washington Township Health Care District, 5.00%, 7/1/32     506,965      
 
 
            $ 6,951,643      
 
 
 
 
Insured-Electric Utilities — 9.0%
 
$ 1,475     Glendale Electric, (NPFG), 5.00%, 2/1/32   $ 1,485,355      
  1,500     Los Angeles Department of Water and Power, (AMBAC), (BHAC), 5.00%, 7/1/26(1)     1,587,210      
  1,000     Sacramento Municipal Utility District, (AGM), 5.00%, 8/15/27     1,057,380      
 
 
            $ 4,129,945      
 
 
 
 
Insured-Escrowed / Prerefunded — 8.3%
 
$ 1,025     California Infrastructure & Economic Development Bank, (Bay Area Toll Bridges), (AMBAC), Prerefunded to 1/1/28, 5.00%, 7/1/36   $ 1,189,195      
  3,130     Clovis Unified School District, (FGIC), (NPFG), Escrowed to Maturity, 0.00%, 8/1/20     2,173,409      
  395     Orange County Water District, Certificates of Participation, (NPFG), Escrowed to Maturity, 5.00%, 8/15/34     437,245      
 
 
            $ 3,799,849      
 
 
 
 
Insured-General Obligations — 46.2%
 
$ 740     Antelope Valley Community College District, (Election of 2004), (NPFG), 5.25%, 8/1/39   $ 758,034      
  7,125     Arcadia Unified School District, (AGM), 0.00%, 8/1/38     1,186,170      
  3,115     Arcadia Unified School District, (AGM), 0.00%, 8/1/40     456,534      
  3,270     Arcadia Unified School District, (AGM), 0.00%, 8/1/41     446,192      
  1,500     Carlsbad Unified School District, (Election of 2006), (NPFG), 5.25%, 8/1/32     1,586,790      
  19,350     Chabot-Las Positas Community College District, (AMBAC), 0.00%, 8/1/43     2,086,897      
  6,675     Coast Community College District, (Election of 2002), (AGM), 0.00%, 8/1/35     1,319,380      
  1,080     El Camino Hospital District, (NPFG), 4.45%, 8/1/36     999,454      
  2,350     Long Beach Unified School District, (Election of 1999), (AGM), 5.00%, 8/1/31     2,359,165      
  2,075     Los Angeles Community College District, (Election of 2001), (AGM), (FGIC), 5.00%, 8/1/32     2,106,664      
  1,000     Mount Diablo Unified School District, (AGM), 5.00%, 8/1/25     1,024,050      
  1,250     Palm Springs Unified School District, (Election of 2008), (AGC), 5.00%, 8/1/33     1,286,563      
  4,300     San Mateo County Community College District, (Election of 2001), (FGIC), (NPFG), 0.00%, 9/1/21     2,432,467      
  1,600     Santa Clara Unified School District, (Election of 2004), (AGM), 4.375%, 7/1/30     1,530,432      
  3,200     Union Elementary School District, (FGIC), (NPFG), 0.00%, 9/1/22     1,676,832      
 
 
            $ 21,255,624      
 
 
 
 
Insured-Hospital — 6.6%
 
$ 1,250     California Statewide Communities Development Authority, (Kaiser Permanente), (BHAC), 5.00%, 3/1/41(1)   $ 1,254,388      
  1,750     California Statewide Communities Development Authority, (Sutter Health), (AGM), 5.05%, 8/15/38(1)     1,759,397      
 
 
            $ 3,013,785      
 
 
 
 
Insured-Lease Revenue / Certificates of Participation — 16.6%
 
$ 3,520     California Public Works Board, (Department of General Services), (AMBAC), 5.00%, 12/1/27   $ 3,280,992      
  1,250     Puerto Rico Public Finance Corp., (AMBAC), Escrowed to Maturity, 5.50%, 8/1/27     1,501,075      
  1,750     San Diego County Water Authority, Certificates of Participation, (AGM), 5.00%, 5/1/38(1)     1,781,360      
  1,075     San Jose Financing Authority, (Civic Center), (AMBAC), 5.00%, 6/1/32     1,080,181      
 
 
            $ 7,643,608      
 
 
 
 
Insured-Private Education — 1.7%
 
$ 785     California Educational Facilities Authority, (Pepperdine University), (AMBAC), 5.00%, 12/1/32   $ 784,945      
 
 
            $ 784,945      
 
 
 
 
Insured-Public Education — 13.2%
 
$ 2,000     California State University, (AGM), (BHAC), 5.00%, 11/1/39(1)   $ 2,048,000      
  4,000     California State University, (AMBAC), 5.00%, 11/1/33(2)     4,023,880      
 
 
            $ 6,071,880      
 
 
 

 
See notes to financial statements

16

 

 
Eaton Vance California Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Insured-Special Assessment Revenue — 17.1%
 
$ 2,500     Cathedral City Public Financing Authority, (Housing Redevelopment), (NPFG), 5.00%, 8/1/33   $ 2,251,700      
  2,500     Cathedral City Public Financing Authority, (Tax Allocation Redevelopment), (NPFG), 5.00%, 8/1/33     2,251,700      
  1,000     Irvine Public Facility and Infrastructure Authority, (AMBAC), 5.00%, 9/2/26     924,940      
  1,795     Los Osos Community Services District, (Wastewater Assessment District No. 1), (NPFG), 5.00%, 9/2/33     1,568,632      
  945     Murrieta Redevelopment Agency Tax, (NPFG), 5.00%, 8/1/32     850,935      
 
 
            $ 7,847,907      
 
 
 
 
Insured-Special Tax Revenue — 12.0%
 
$ 2,195     Hesperia Public Financing Authority, (Redevelopment and Housing Projects), (XLCA), 5.00%, 9/1/37   $ 1,792,832      
  11,485     Puerto Rico Sales Tax Financing Corp., (AMBAC), 0.00%, 8/1/54     684,621      
  2,320     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/44     282,692      
  4,600     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45     520,858      
  2,905     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/46     304,415      
  245     Sacramento Area Flood Control Agency, (BHAC), 5.50%, 10/1/28     270,703      
  375     Sacramento Area Flood Control Agency, (BHAC), 5.625%, 10/1/37     408,671      
  260     San Francisco Bay Area Rapid Transportation District, Sales Tax Revenue, (AMBAC), 5.00%, 7/1/31     264,521      
  985     San Francisco Bay Area Rapid Transportation District, Sales Tax Revenue, (AMBAC), 5.125%, 7/1/36     1,001,716      
 
 
            $ 5,531,029      
 
 
 
 
Insured-Transportation — 2.0%
 
$ 3,520     San Joaquin Hills Transportation Corridor Agency, (NPFG), 0.00%, 1/15/27   $ 904,464      
 
 
            $ 904,464      
 
 
 
 
Insured-Utilities — 3.0%
 
$ 1,390     Los Angeles Department of Water and Power, (FGIC), (NPFG), 5.125%, 7/1/41   $ 1,397,937      
 
 
            $ 1,397,937      
 
 
 
 
Insured-Water Revenue — 18.2%
 
$ 1,235     Calleguas Las Virgines Public Financing Authority, (Municipal Water District), (BHAC), (FGIC), 4.75%, 7/1/37   $ 1,238,890      
  2,500     Contra Costa Water District, (AGM), 5.00%, 10/1/32(1)     2,532,264      
  100     East Bay Municipal Utility District, Water System Revenue, (AGM), (FGIC), 5.00%, 6/1/32     104,933      
  1,430     East Bay Municipal Utility District, Water System Revenue, (FGIC), (NPFG), 5.00%, 6/1/32     1,500,542      
  1,500     Los Angeles Department of Water and Power, (NPFG), 3.00%, 7/1/30     1,160,070      
  445     Riverside, Water Revenue, (AGM), 5.00%, 10/1/38     454,265      
  1,475     Santa Clara Valley Water District, (AGM), 3.75%, 6/1/28     1,350,658      
 
 
            $ 8,341,622      
 
 
 
 
Private Education — 3.6%
 
$ 750     California Educational Facilities Authority, (Claremont McKenna College), 5.00%, 1/1/39   $ 768,638      
  380     California Educational Facilities Authority, (Loyola Marymount University), 5.00%, 10/1/30     380,000      
  500     California Educational Facilities Authority, (Stanford University), 5.125%, 1/1/31(3)     500,920      
 
 
            $ 1,649,558      
 
 
 
 
Transportation — 2.4%
 
$ 1,075     Los Angeles Department of Airports, (Los Angeles International Airport), 5.00%, 5/15/35(4)   $ 1,097,210      
 
 
            $ 1,097,210      
 
 
     
Total Tax-Exempt Investments — 176.5%
   
(identified cost $85,917,520)
  $ 81,121,724      
 
 
                     
                     
Short-Term Investments — 1.2%
 
Principal Amount
 		               
(000’s omitted)       Description   Value      
 
 
$ 561     State Street Bank and Trust Euro Time Deposit, 0.01%, 4/1/10   $ 561,395      
 
 
     
Total Short-Term Investments — 1.2%
   
(identified cost $561,395)
  $ 561,395      
 
 
     
Total Investments — 177.7%
   
(identified cost $86,478,915)
  $ 81,683,119      
 
 
             
Auction Preferred Shares Plus Cumulative Unpaid Dividends — (55.9)%
  $ (25,702,251 )    
 
 
             
Other Assets, Less Liabilities — (21.8)%
  $ (10,003,524 )    
 
 
             
Net Assets Applicable to Common Shares — 100.0%
  $ 45,977,344      
 
 

 
See notes to financial statements

17

 

 
Eaton Vance California Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.
 
AGC - Assured Guaranty Corp.
 
AGM - Assured Guaranty Municipal Corp.
 
AMBAC - AMBAC Financial Group, Inc.
 
BHAC - Berkshire Hathaway Assurance Corp.
 
FGIC - Financial Guaranty Insurance Company
 
NPFG - National Public Finance Guaranty Corp.
 
XLCA - XL Capital Assurance, Inc.
 
The Fund invests primarily in debt securities issued by California municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at March 31, 2010, 86.6% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 1.6% to 30.0% of total investments.
 
(1) Security represents the underlying municipal bond of an inverse floater (see Note 1H).
 
(2) Security (or a portion thereof) has been segregated to cover payable for when-issued securities.
 
(3) Security (or a portion thereof) has been pledged to cover margin requirements on open financial futures contracts.
 
(4) When-issued security.

 
See notes to financial statements

18

 

Eaton Vance Massachusetts Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
                     
Tax-Exempt Investments — 168.6%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Escrowed / Prerefunded — 5.2%
 
$ 500     Massachusetts Development Finance Agency, (Massachusetts College of Pharmacy), Prefunded to 7/31/13, 5.75%, 7/1/33   $ 575,625      
  600     Massachusetts Development Finance Agency, (Western New England College), Prefunded to 12/1/12, 6.125%, 12/1/32     684,630      
 
 
            $ 1,260,255      
 
 
 
 
Hospital — 4.7%
 
$ 775     Massachusetts Health and Educational Facilities Authority, (Dana-Farber Cancer Institute), 5.00%, 12/1/37   $ 781,456      
  370     Massachusetts Health and Educational Facilities Authority, (South Shore Hospital), 5.75%, 7/1/29     370,181      
 
 
            $ 1,151,637      
 
 
 
 
Insured-Electric Utilities — 4.8%
 
$ 1,095     Puerto Rico Electric Power Authority, (NPFG), 5.25%, 7/1/23   $ 1,158,258      
 
 
            $ 1,158,258      
 
 
 
 
Insured-Escrowed / Prerefunded — 6.0%
 
$ 2,900     Massachusetts College Building Authority, (NPFG), Escrowed to Maturity, 0.00%, 5/1/26   $ 1,469,894      
 
 
            $ 1,469,894      
 
 
 
 
Insured-General Obligations — 18.3%
 
$ 1,900     Massachusetts, (AMBAC), 5.50%, 8/1/30   $ 2,235,388      
  910     Milford, (AGM), 4.25%, 12/15/46     878,459      
  1,000     Revere, (AGC), 5.00%, 4/1/39     1,029,210      
  300     Tewksbury, (AGM), 4.625%, 3/15/27     316,746      
 
 
            $ 4,459,803      
 
 
 
 
Insured-Hospital — 2.1%
 
$ 260     Massachusetts Health and Educational Facilities Authority, (Cape Cod Healthcare, Inc.), (AGC), 5.00%, 11/15/25   $ 259,706      
  140     Massachusetts Health and Educational Facilities Authority, (Cape Cod Healthcare, Inc.), (AGC), 5.00%, 11/15/31     138,713      
  125     Massachusetts Health and Educational Facilities Authority, (Cape Cod Healthcare, Inc.), (AGC), 5.125%, 11/15/35     123,848      
 
 
            $ 522,267      
 
 
 
Insured-Lease Revenue / Certificates of Participation — 11.1%
 
$ 1,000     Plymouth County Correctional Facility, (AMBAC), 5.00%, 4/1/22   $ 1,028,690      
  495     Puerto Rico Public Buildings Authority, (CIFG), 5.25%, 7/1/36     482,571      
  1,000     Puerto Rico Public Finance Corp., (AMBAC), Escrowed to Maturity, 5.50%, 8/1/27     1,200,860      
 
 
            $ 2,712,121      
 
 
 
 
Insured-Other Revenue — 7.6%
 
$ 470     Massachusetts Development Finance Agency, (100 Cambridge Street Redevelopment), (NPFG), 5.125%, 2/1/34   $ 453,973      
  1,315     Massachusetts Development Finance Agency, (WGBH Educational Foundation), (AMBAC), 5.75%, 1/1/42     1,401,093      
 
 
            $ 1,855,066      
 
 
 
 
Insured-Private Education — 21.2%
 
$ 1,250     Massachusetts Development Finance Agency, (Boston College), (NPFG), 5.00%, 7/1/38   $ 1,288,213      
  1,105     Massachusetts Development Finance Agency, (Boston University), (XLCA), 6.00%, 5/15/59     1,236,771      
  750     Massachusetts Development Finance Agency, (College of the Holy Cross), (AMBAC), 5.25%, 9/1/32(1)     844,855      
  750     Massachusetts Development Finance Agency, (Massachusetts College of Pharmacy), (AGC), 5.00%, 7/1/35     763,800      
  1,000     Massachusetts Development Finance Agency, (Massachusetts College of Pharmacy), (AGC), 5.00%, 7/1/37     1,021,880      
 
 
            $ 5,155,519      
 
 
 
 
Insured-Public Education — 19.5%
 
$ 260     Massachusetts College Building Authority, (AGC), 5.00%, 5/1/33   $ 271,315      
  320     Massachusetts College Building Authority, (AGC), 5.00%, 5/1/38     331,498      
  700     Massachusetts College Building Authority, (XLCA), 5.50%, 5/1/39     786,464      
  1,000     Massachusetts Health and Educational Facilities Authority, (University of Massachusetts), (FGIC), (NPFG), 5.125%, 10/1/34     1,005,000      
  1,250     Massachusetts Health and Educational Facilities Authority, (Worcester City Campus Corp.), (FGIC), (NPFG), 4.75%, 10/1/36     1,218,725      
  1,150     Massachusetts Health and Educational Facilities Authority, (Worcester State College), (AMBAC), 5.00%, 11/1/32     1,139,201      
 
 
            $ 4,752,203      
 
 
 

 
See notes to financial statements

19

 

 
Eaton Vance Massachusetts Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Insured-Special Tax Revenue — 24.0%
 
$ 1,225     Martha’s Vineyard Land Bank, (AMBAC), 5.00%, 5/1/32   $ 1,240,998      
  750     Massachusetts, Special Obligation, Dedicated Tax Revenue, (FGIC), (NPFG), 5.50%, 1/1/29     849,375      
  305     Massachusetts Bay Transportation Authority, Assessment Bonds, (NPFG), 4.00%, 7/1/33     287,548      
  400     Massachusetts Bay Transportation Authority, Sales Tax Revenue, (NPFG), 5.50%, 7/1/28     473,144      
  2,000     Massachusetts School Building Authority, Dedicated Sales Tax Revenue, (AMBAC), 5.00%, 8/15/37     2,081,780      
  5,265     Puerto Rico Sales Tax Financing Corp., (AMBAC), 0.00%, 8/1/54     313,847      
  1,725     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/44     210,191      
  2,090     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45     236,651      
  1,325     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/46     138,847      
 
 
            $ 5,832,381      
 
 
 
 
Insured-Transportation — 5.3%
 
$ 1,300     Massachusetts Turnpike Authority, Metropolitan Highway System, (AMBAC), 5.00%, 1/1/39   $ 1,290,094      
 
 
            $ 1,290,094      
 
 
 
 
Insured-Water Revenue — 10.8%
 
$ 1,075     Massachusetts Water Resources Authority, (AGM), 5.00%, 8/1/32(2)   $ 1,096,382      
  560     Massachusetts Water Resources Authority, (AGM), 5.25%, 8/1/36     625,313      
  975     Massachusetts Water Resources Authority, (AMBAC), (BHAC), 4.00%, 8/1/40     915,427      
 
 
            $ 2,637,122      
 
 
 
 
Private Education — 21.1%
 
$ 750     Massachusetts Development Finance Agency, (Middlesex School), 5.00%, 9/1/33   $ 756,525      
  2,000     Massachusetts Health and Educational Facilities Authority, (Harvard University), 5.00%, 10/1/38(1)     2,111,900      
  750     Massachusetts Health and Educational Facilities Authority, (Harvard University), 5.50%, 11/15/36     834,503      
  1,350     Massachusetts Health and Educational Facilities Authority, (Massachusetts Institute of Technology), 5.00%, 7/1/38     1,423,291      
 
 
            $ 5,126,219      
 
 
 
Special Tax Revenue — 4.4%
 
$ 1,000     Massachusetts Bay Transportation Authority, Sales Tax Revenue, 5.00%, 7/1/35(3)   $ 1,058,750      
 
 
            $ 1,058,750      
 
 
 
 
Senior Living / Life Care — 2.5%
 
$ 745     Massachusetts Development Finance Agency, (Berkshire Retirement Community, Inc.), 5.15%, 7/1/31   $ 607,801      
 
 
            $ 607,801      
 
 
     
Total Tax-Exempt Investments — 168.6%
   
(identified cost $40,289,039)
  $ 41,049,390      
 
 
                     
                     
Short-Term Investments — 3.3%
 
Principal Amount
 		               
(000’s omitted)       Description   Value      
 
 
$ 793     State Street Bank and Trust Euro Time Deposit, 0.01%, 4/1/10   $ 792,537      
 
 
     
Total Short-Term Investments — 3.3%
   
(identified cost $792,537)
  $ 792,537      
 
 
     
Total Investments — 171.9%
   
(identified cost $41,081,576)
  $ 41,841,927      
 
 
             
Auction Preferred Shares Plus Cumulative Unpaid Dividends — (55.8)%
  $ (13,576,020 )    
 
 
             
Other Assets, Less Liabilities — (16.1)%
  $ (3,922,909 )    
 
 
             
Net Assets Applicable to Common Shares — 100.0%
  $ 24,342,998      
 
 
 
The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.
 
AGC - Assured Guaranty Corp.
 
AGM - Assured Guaranty Municipal Corp.
 
AMBAC - AMBAC Financial Group, Inc.
 
BHAC - Berkshire Hathaway Assurance Corp.
 
CIFG - CIFG Assurance North America, Inc.
 
FGIC - Financial Guaranty Insurance Company
 
NPFG - National Public Finance Guaranty Corp.
 
XLCA - XL Capital Assurance, Inc.
 
The Fund invests primarily in debt securities issued by Massachusetts municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to

 
See notes to financial statements

20

 

 
Eaton Vance Massachusetts Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
 
reduce the risk associated with such economic developments, at March 31, 2010, 76.1% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 1.2% to 32.7% of total investments.
 
(1) Security represents the underlying municipal bond of an inverse floater (see Note 1H).
 
(2) Security (or a portion thereof) has been segregated to cover payable for when-issued securities.
 
(3) When-issued security.

 
See notes to financial statements

21

 

Eaton Vance Michigan Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
                     
Tax-Exempt Investments — 157.8%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Electric Utilities — 2.9%
 
$ 620     Michigan Strategic Fund, (Detroit Edison Pollution Control), 5.45%, 9/1/29   $ 621,643      
 
 
            $ 621,643      
 
 
 
 
Escrowed / Prerefunded — 9.9%
 
$ 400     Michigan Hospital Finance Authority, (Chelsea Community Hospital), Prerefunded to 5/15/15, 5.00%, 5/15/30   $ 460,580      
  1,500     Michigan Hospital Finance Authority, (Sparrow Obligation Group), Prerefunded to 11/15/11, 5.625%, 11/15/36     1,630,320      
 
 
            $ 2,090,900      
 
 
 
 
Hospital — 7.7%
 
$ 1,000     Michigan Hospital Finance Authority, (Oakwood Hospital System), 5.75%, 4/1/32   $ 996,290      
  640     Michigan Hospital Finance Authority, (Trinity Health), 5.375%, 12/1/30     636,397      
 
 
            $ 1,632,687      
 
 
 
 
Insured-Electric Utilities — 7.3%
 
$ 500     Michigan Strategic Fund, (Detroit Edison Co.), (XLCA), 5.25%, 12/15/32   $ 499,300      
  1,000     Puerto Rico Electric Power Authority, (NPFG), 5.25%, 7/1/26     1,049,140      
 
 
            $ 1,548,440      
 
 
 
 
Insured-Escrowed / Prerefunded — 42.2%
 
$ 750     Detroit School District, (School Bond Loan Fund), (AGM), Prerefunded to 5/1/12, 5.125%, 5/1/31   $ 812,565      
  1,250     Detroit Sewer Disposal, (FGIC), Prerefunded to 7/1/11, 5.125%, 7/1/31     1,319,750      
  1,500     Lansing Building Authority, (NPFG), Prerefunded to 6/1/13, 5.00%, 6/1/29     1,676,325      
  1,150     Michigan Hospital Finance Authority, (St. John Health System), (AMBAC), Escrowed to Maturity, 5.00%, 5/15/28     1,156,072      
  1,750     Michigan House of Representatives, (AMBAC), Escrowed to Maturity, 0.00%, 8/15/22     1,028,562      
  2,615     Michigan House of Representatives, (AMBAC), Escrowed to Maturity, 0.00%, 8/15/23     1,455,117      
  1,300     Reed City Public Schools, (AGM), Prerefunded to 5/1/14, 5.00%, 5/1/29     1,480,050      
 
 
            $ 8,928,441      
 
 
 
Insured-General Obligations — 22.1%
 
$ 1,960     Grand Rapids and Kent County Joint Building Authority, (DeVos Place), (NPFG), 0.00%, 12/1/27(1)   $ 839,135      
  750     Greenville Public Schools, (NPFG), 5.00%, 5/1/25     774,338      
  1,330     Okemos Public School District, (NPFG), 0.00%, 5/1/19     889,344      
  1,000     Pinconning Area Schools, (AGM), 5.00%, 5/1/33     1,016,050      
  1,000     Royal Oak, (AGC), 6.25%, 10/1/28     1,149,130      
 
 
            $ 4,667,997      
 
 
 
 
Insured-Hospital — 6.5%
 
$ 500     Michigan Hospital Finance Authority, (Mid-Michigan Obligation Group), (AMBAC), 5.00%, 4/15/32   $ 475,015      
  975     Royal Oak Hospital Finance Authority, (William Beaumont Hospital), (NPFG), 5.25%, 11/15/35     900,178      
 
 
            $ 1,375,193      
 
 
 
 
Insured-Lease Revenue / Certificates of Participation — 8.2%
 
$ 1,000     Michigan Building Authority, (AGM), (FGIC), 0.00%, 10/15/29   $ 336,030      
  3,100     Michigan Building Authority, (FGIC), (NPFG), 0.00%, 10/15/30     906,688      
  495     Puerto Rico Public Buildings Authority, (CIFG), 5.25%, 7/1/36     482,571      
 
 
            $ 1,725,289      
 
 
 
 
Insured-Public Education — 15.1%
 
$ 750     Central Michigan University, (AMBAC), 5.05%, 10/1/32   $ 754,777      
  435     Ferris State University, (AGC), 5.125%, 10/1/33     451,539      
  750     Lake Superior State University, (AMBAC), 5.125%, 11/15/26     750,240      
  1,200     Wayne University, (NPFG), 5.00%, 11/15/37     1,227,408      
 
 
            $ 3,183,964      
 
 
 
 
Insured-Sewer Revenue — 2.0%
 
$ 500     Detroit Sewer Disposal System, (NPFG), 4.50%, 7/1/35   $ 430,325      
 
 
            $ 430,325      
 
 
 
 
Insured-Special Tax Revenue — 13.1%
 
$ 6,100     Puerto Rico Sales Tax Financing Corp., (AMBAC), 0.00%, 8/1/54   $ 363,621      
  1,465     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/44     178,510      
  1,670     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45     189,094      

 
See notes to financial statements

22

 

 
Eaton Vance Michigan Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
Insured-Special Tax Revenue (continued)
 
                     
$ 1,115     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/46   $ 116,841      
  1,000     Wayne Charter County, (Airport Hotel-Detroit Metropolitan Airport), (NPFG), 5.00%, 12/1/30     913,290      
  1,000     Ypsilanti Community Utilities Authority, (Sanitary Sewer System), (FGIC), (NPFG), 5.00%, 5/1/32     1,005,850      
 
 
            $ 2,767,206      
 
 
 
 
Insured-Utilities — 7.3%
 
$ 1,000     Lansing Board of Water and Light, (Water Supply, Steam and Electric Utility), (AGM), 5.00%, 7/1/25   $ 1,025,380      
  510     Lansing Board of Water and Light, (Water Supply, Steam and Electric Utility), (AGM), 5.00%, 7/1/26     521,465      
 
 
            $ 1,546,845      
 
 
 
 
Insured-Water Revenue — 11.5%
 
$ 1,425     Detroit Water Supply System, (FGIC), (NPFG), 5.00%, 7/1/30   $ 1,382,521      
  1,000     Grand Rapids Water Supply System, (AGC), 5.00%, 1/1/29     1,043,860      
 
 
            $ 2,426,381      
 
 
 
 
Private Education — 2.0%
 
$ 450     Michigan Higher Education Facilities Authority, (Hillsdale College), 5.00%, 3/1/35   $ 426,663      
 
 
            $ 426,663      
 
 
     
Total Tax-Exempt Investments — 157.8%
   
(identified cost $32,788,239)
  $ 33,371,974      
 
 
                     
                     
Short-Term Investments — 3.3%
 
Principal Amount
 		               
(000’s omitted)       Description   Value      
 
 
$ 699     State Street Bank and Trust Euro Time Deposit, 0.01%, 4/1/10   $ 698,907      
 
 
     
Total Short-Term Investments — 3.3%
   
(identified cost $698,907)
  $ 698,907      
 
 
     
Total Investments — 161.1%
   
(identified cost $33,487,146)
  $ 34,070,881      
 
 
             
Auction Preferred Shares Plus Cumulative Unpaid Dividends — (63.0)%
  $ (13,325,162 )    
 
 
             
Other Assets, Less Liabilities — 1.9%
  $ 402,647      
 
 
             
Net Assets Applicable to Common Shares — 100.0%
  $ 21,148,366      
 
 
 
The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.
 
AGC - Assured Guaranty Corp.
 
AGM - Assured Guaranty Municipal Corp.
 
AMBAC - AMBAC Financial Group, Inc.
 
CIFG - CIFG Assurance North America, Inc.
 
FGIC - Financial Guaranty Insurance Company
 
NPFG - National Public Finance Guaranty Corp.
 
XLCA - XL Capital Assurance, Inc.
 
The Fund invests primarily in debt securities issued by Michigan municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at March 31, 2010, 83.9% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 1.4% to 36.6% of total investments.
 
(1) Security (or a portion thereof) has been pledged to cover margin requirements on open financial futures contracts.

 
See notes to financial statements

23

 

Eaton Vance New Jersey Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
                     
Tax-Exempt Investments — 170.3%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Hospital — 10.0%
 
$ 180     Camden County Improvement Authority, (Cooper Health System), 5.00%, 2/15/35   $ 148,250      
  1,300     Camden County Improvement Authority, (Cooper Health System), 5.75%, 2/15/34     1,198,691      
  600     New Jersey Health Care Facilities Financing Authority, (Atlanticare Regional Medical Center), 5.00%, 7/1/37     593,784      
  250     New Jersey Health Care Facilities Financing Authority, (Hunterdon Medical Center), 5.125%, 7/1/35     238,905      
  1,425     New Jersey Health Care Facilities Financing Authority, (South Jersey Hospital), 5.00%, 7/1/46     1,351,513      
 
 
            $ 3,531,143      
 
 
 
 
Insured-Electric Utilities — 3.0%
 
$ 1,000     Puerto Rico Electric Power Authority, (NPFG), 5.25%, 7/1/26   $ 1,049,140      
 
 
            $ 1,049,140      
 
 
 
 
Insured-General Obligations — 39.1%
 
$ 2,415     Bayonne, (AGM), 0.00%, 7/1/23   $ 1,274,903      
  1,000     Bayonne, (AGM), 5.50%, 7/1/39     1,059,380      
  320     Delaware Township, Hunterdon County, (AGC), 5.00%, 10/15/35     336,563      
  340     Delaware Township, Hunterdon County, (AGC), 5.10%, 10/15/36     360,108      
  360     Delaware Township, Hunterdon County, (AGC), 5.15%, 10/15/37     381,935      
  382     Delaware Township, Hunterdon County, (AGC), 5.20%, 10/15/38     405,504      
  1,500     Egg Harbor Township School District, (AGM), 3.50%, 4/1/28     1,380,810      
  2,000     Hudson County Improvement Authority, (NPFG), 0.00%, 12/15/38     382,120      
  5,500     Irvington Township, (AGM), 0.00%, 7/15/26     2,568,335      
  2,590     Jackson Township School District, (NPFG), 2.50%, 6/15/27     2,065,344      
  1,000     Jersey City, (AGM), 5.00%, 1/15/29     1,054,470      
  700     Lakewood Township, (AGC), 5.75%, 11/1/31     788,774      
  1,115     Monroe Township Board of Education, Middlesex County, (AGC), 4.75%, 3/1/34     1,148,706      
  210     Nutley School District, (NPFG), 4.75%, 7/15/30     217,978      
  410     Nutley School District, (NPFG), 4.75%, 7/15/31     423,382      
 
 
            $ 13,848,312      
 
 
 
 
Insured-Hospital — 18.4%
 
$ 2,000     New Jersey Health Care Facilities Financing Authority, (Englewood Hospital), (NPFG), 5.00%, 8/1/31   $ 2,008,160      
  2,000     New Jersey Health Care Facilities Financing Authority, (Hackensack University Medical Center), (AGC), 5.25%, 1/1/36(1)     2,051,020      
  625     New Jersey Health Care Facilities Financing Authority, (Meridian Health Center), Series II, (AGC), 5.00%, 7/1/38     629,150      
  250     New Jersey Health Care Facilities Financing Authority, (Meridian Health Center), Series V, (AGC), 5.00%, 7/1/38(1)     251,660      
  1,500     New Jersey Health Care Facilities Financing Authority, (Virtua Health), (AGC), 5.50%, 7/1/38     1,579,860      
 
 
            $ 6,519,850      
 
 
 
 
Insured-Lease Revenue / Certificates of Participation — 19.2%
 
$ 1,000     Essex County Improvement Authority, (NPFG), 5.50%, 10/1/30   $ 1,121,480      
  445     Gloucester County Improvement Authority, (NPFG), 4.75%, 9/1/30     457,166      
  1,250     Middlesex County, Certificates of Participation, (NPFG), 5.00%, 8/1/31     1,262,600      
  1,300     New Jersey Economic Development Authority, (School Facilities Construction), (AGC), 5.50%, 12/15/34     1,416,532      
  500     New Jersey Economic Development Authority, (School Facilities Construction), (FGIC), (NPFG), 5.50%, 9/1/28     550,865      
  495     Puerto Rico Public Buildings Authority, (CIFG), 5.25%, 7/1/36     482,571      
  1,250     Puerto Rico Public Finance Corp., (AMBAC), Escrowed to Maturity, 5.50%, 8/1/27     1,501,075      
 
 
            $ 6,792,289      
 
 
 
 
Insured-Other Revenue — 4.5%
 
$ 1,500     Hudson County Improvement Authority, (Harrison Parking), (AGC), 5.25%, 1/1/39   $ 1,587,195      
 
 
            $ 1,587,195      
 
 
 
 
Insured-Public Education — 14.4%
 
$ 1,945     New Jersey Educational Facilities Authority, (College of New Jersey), (AGM), 5.00%, 7/1/35(1)   $ 2,005,871      
  500     New Jersey Educational Facilities Authority, (Montclair State University), (NPFG), 3.75%, 7/1/24     468,870      
  1,000     New Jersey Educational Facilities Authority, (Rowan University), (AGM), (FGIC), 3.00%, 7/1/27     816,070      
  465     New Jersey Educational Facilities Authority, (Rowan University), (AGM), (FGIC), 3.00%, 7/1/28     370,795      
  1,145     New Jersey Educational Facilities Authority, (William Paterson University), (AGC), 4.75%, 7/1/34     1,146,855      
  275     New Jersey Educational Facilities Authority, (William Paterson University), (AGC), 5.00%, 7/1/38     281,702      
 
 
            $ 5,090,163      
 
 
 

 
See notes to financial statements

24

 

 
Eaton Vance New Jersey Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Insured-Sewer Revenue — 2.1%
 
$ 1,975     Rahway Valley Sewerage Authority, (NPFG), 0.00%, 9/1/27   $ 741,454      
 
 
            $ 741,454      
 
 
 
 
Insured-Special Tax Revenue — 13.7%
 
$ 1,000     Garden State Preservation Trust, (AGM), 0.00%, 11/1/21   $ 615,990      
  500     Garden State Preservation Trust, (AGM), 5.80%, 11/1/21     578,085      
  1,000     New Jersey Economic Development Authority, (Motor Vehicle Surcharges), (BHAC), (NPFG), 5.00%, 7/1/27     1,031,170      
  2,390     New Jersey Economic Development Authority, (Motor Vehicle Surcharges), (XLCA), 0.00%, 7/1/26     1,011,830      
  1,120     New Jersey Economic Development Authority, (Motor Vehicle Surcharges), (XLCA), 0.00%, 7/1/27     444,472      
  7,675     Puerto Rico Sales Tax Financing Corp., (AMBAC), 0.00%, 8/1/54     457,507      
  1,520     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/44     185,212      
  3,005     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45     340,256      
  1,900     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/46     199,101      
 
 
            $ 4,863,623      
 
 
 
 
Insured-Transportation — 24.0%
 
$ 1,560     New Jersey Transportation Trust Fund Authority, (Transportation System), (AMBAC), (BHAC), 0.00%, 12/15/26   $ 670,301      
  3,235     New Jersey Transportation Trust Fund Authority, (Transportation System), (BHAC), (FGIC), 0.00%, 12/15/31     992,563      
  1,500     New Jersey Turnpike Authority, (AGM), (BHAC), 5.25%, 1/1/29     1,734,780      
  3,875     Port Authority of New York and New Jersey, (AGM), 5.00%, 11/1/27(1)     4,092,842      
  795     Port Authority of New York and New Jersey, (AGM), 5.00%, 8/15/33     828,780      
  180     South Jersey Transportation Authority, (AGC), 5.50%, 11/1/33     195,485      
 
 
            $ 8,514,751      
 
 
 
 
Insured-Water and Sewer — 6.7%
 
$ 4,500     Middlesex County Improvement Authority, (Perth Amboy), (AMBAC), 0.00%, 9/1/24   $ 1,815,345      
  970     Passaic Valley Sewerage Commissioners, (FGIC), (NPFG), 2.50%, 12/1/32     575,986      
 
 
            $ 2,391,331      
 
 
 
Lease Revenue / Certificates of Participation — 2.1%
 
$ 750     New Jersey Health Care Facilities Financing Authority, (Contract Hospital Asset Transportation Program), 5.25%, 10/1/38   $ 753,570      
 
 
            $ 753,570      
 
 
 
 
Private Education — 5.5%
 
$ 2,000     New Jersey Educational Facilities Authority, (Princeton University), 4.25%, 7/1/40(2)   $ 1,958,180      
 
 
            $ 1,958,180      
 
 
 
 
Other Revenue — 3.8%
 
$ 1,300     New Jersey Economic Development Authority, (Duke Farms Foundation), 5.00%, 7/1/48   $ 1,357,252      
 
 
            $ 1,357,252      
 
 
 
 
Transportation — 3.8%
 
$ 1,325     South Jersey Port Authority, (Marine Terminal), 5.10%, 1/1/33   $ 1,333,665      
 
 
            $ 1,333,665      
 
 
     
Total Tax-Exempt Investments — 170.3%
   
(identified cost $59,561,991)
  $ 60,331,918      
 
 
                     
                     
Short-Term Investments — 1.5%
 
Principal Amount
 		               
(000’s omitted)       Description   Value      
 
 
$ 556     State Street Bank and Trust Euro Time Deposit, 0.01%, 4/1/10   $ 555,683      
 
 
     
Total Short-Term Investments — 1.5%
   
(identified cost $555,683)
  $ 555,683      
 
 
     
Total Investments — 171.8%
   
(identified cost $60,117,674)
  $ 60,887,601      
 
 
             
Auction Preferred Shares Plus Cumulative Unpaid Dividends — (55.3)%
  $ (19,600,475 )    
 
 
             
Other Assets, Less Liabilities — (16.5)%
  $ (5,859,052 )    
 
 
             
Net Assets Applicable to Common Shares — 100.0%
  $ 35,428,074      
 
 

 
See notes to financial statements

25

 

 
Eaton Vance New Jersey Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.
 
AGC - Assured Guaranty Corp.
 
AGM - Assured Guaranty Municipal Corp.
 
AMBAC - AMBAC Financial Group, Inc.
 
BHAC - Berkshire Hathaway Assurance Corp.
 
CIFG - CIFG Assurance North America, Inc.
 
FGIC - Financial Guaranty Insurance Company
 
NPFG - National Public Finance Guaranty Corp.
 
XLCA - XL Capital Assurance, Inc.
 
The Fund invests primarily in debt securities issued by New Jersey municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at March 31, 2010, 84.4% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 0.8% to 30.2% of total investments.
 
(1) Security represents the underlying municipal bond of an inverse floater (see Note 1H).
 
(2) Security (or a portion thereof) has been pledged to cover margin requirements on open financial futures contracts.

 
See notes to financial statements

26

 

Eaton Vance New York Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
                     
Tax-Exempt Investments — 167.8%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Hospital — 2.3%
 
$ 750     Suffolk County Industrial Development Agency, (Huntington Hospital), 5.875%, 11/1/32   $ 754,320      
 
 
            $ 754,320      
 
 
 
 
Industrial Development Revenue — 2.5%
 
$ 220     Liberty Development Corp., (Goldman Sachs Group, Inc.), 5.25%, 10/1/35   $ 222,790      
  600     Liberty Development Corp., (Goldman Sachs Group, Inc.), 5.25%, 10/1/35(1)     607,627      
 
 
            $ 830,417      
 
 
 
 
Insured-Electric Utilities — 6.1%
 
$ 500     Long Island Power Authority, (BHAC), 5.50%, 5/1/33   $ 546,670      
  500     Long Island Power Authority, (BHAC), 6.00%, 5/1/33     572,240      
  910     New York Power Authority, (NPFG), 4.50%, 11/15/47(2)     901,956      
 
 
            $ 2,020,866      
 
 
 
 
Insured-Escrowed / Prerefunded — 1.8%
 
$ 1,385     New York Dormitory Authority, (Memorial Sloan-Kettering Cancer Center), (NPFG), Escrowed to Maturity, 0.00%, 7/1/30   $ 587,517      
 
 
            $ 587,517      
 
 
 
 
Insured-General Obligations — 26.0%
 
$ 535     Brentwood Union Free School District, (AGC), 4.75%, 11/15/23   $ 583,867      
  560     Brentwood Union Free School District, (AGC), 5.00%, 11/15/24     623,885      
  200     Freeport Union Free School District, (AGC), 4.00%, 4/1/23     205,560      
  200     Freeport Union Free School District, (AGC), 4.00%, 4/1/24     205,238      
  310     Hauppauge Union Free School District, (AGC), 4.00%, 7/15/24     313,082      
  250     Hoosic Valley Central School District, (AGC), 4.00%, 6/15/23     253,375      
  185     Longwood Central School District, Suffolk County, (AGC), 4.15%, 6/1/23     189,057      
  190     Longwood Central School District, Suffolk County, (AGC), 4.25%, 6/1/24     194,229      
  110     New Rochelle City School District, (AGC), 3.75%, 11/15/19     112,951      
  160     New Rochelle City School District, (AGC), 4.00%, 11/15/20     166,032      
  1,000     New York, (AGM), 5.00%, 4/1/22     1,066,500      
  1,795     New York Dormitory Authority, (School Districts Financing Program), (NPFG), 5.00%, 10/1/30     1,812,627      
  545     Oneida County, (AGC), 4.00%, 4/15/21     551,992      
  100     Plattsburgh, (AGC), 4.25%, 11/15/19     105,911      
  300     Plattsburgh, (AGC), 4.25%, 11/15/20     318,603      
  410     Sachem Central School District, (FGIC), (NPFG), 4.25%, 10/15/28     411,390      
  235     Syracuse, (AGC), 5.00%, 6/15/19     261,235      
  185     Wantagh Union Free School District, (AGC), 4.50%, 11/15/19     202,562      
  190     Wantagh Union Free School District, (AGC), 4.50%, 11/15/20     205,422      
  210     Wantagh Union Free School District, (AGC), 4.75%, 11/15/22     227,466      
  220     Wantagh Union Free School District, (AGC), 4.75%, 11/15/23     236,467      
  350     William Floyd Union Free School District, (AGC), 4.00%, 12/15/24     355,201      
 
 
            $ 8,602,652      
 
 
 
 
Insured-Hospital — 6.4%
 
$ 500     New York City Health and Hospitals Corp., (AGM), 5.50%, 2/15/20   $ 562,335      
  1,000     New York Dormitory Authority, (Health Quest Systems), (AGC), 5.125%, 7/1/37(1)     1,021,470      
  500     New York Dormitory Authority, (Hudson Valley Hospital Center), (AGM), (BHAC), 5.00%, 8/15/36     521,890      
 
 
            $ 2,105,695      
 
 
 
 
Insured-Housing — 3.0%
 
$ 1,000     New York City Housing Corp., (NPFG), 4.95%, 11/1/33   $ 1,013,040      
 
 
            $ 1,013,040      
 
 
 
 
Insured-Lease Revenue / Certificates of Participation — 10.7%
 
$ 2,330     Hudson Yards Infrastructure Corp., (NPFG), 4.50%, 2/15/47   $ 2,019,877      
  950     New York City Transitional Finance Authority, (BHAC), 5.50%, 7/15/38(3)     1,039,813      
  495     Puerto Rico Public Buildings Authority, (CIFG), 5.25%, 7/1/36     482,571      
 
 
            $ 3,542,261      
 
 
 

 
See notes to financial statements

27

 

 
Eaton Vance New York Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Insured-Other Revenue — 16.6%
 
$ 1,360     New York City Cultural Resource Trust, (American Museum of Natural History), (NPFG), 5.00%, 7/1/44   $ 1,385,418      
  2,500     New York City Cultural Resource Trust, (Museum of Modern Art), (AMBAC), (BHAC), 5.125%, 7/1/31(1)     2,548,450      
  1,720     New York City Industrial Development Agency, (Yankee Stadium), (NPFG), 4.75%, 3/1/46     1,555,740      
 
 
            $ 5,489,608      
 
 
 
 
Insured-Private Education — 33.9%
 
$ 1,440     New York Dormitory Authority, (Barnard College), (FGIC), (NPFG), 5.00%, 7/1/24   $ 1,506,686      
  1,925     New York Dormitory Authority, (Brooklyn Law School), (XLCA), 5.125%, 7/1/30     1,927,406      
  2,250     New York Dormitory Authority, (Fordham University), (AGC), (BHAC), 5.00%, 7/1/38(1)     2,348,730      
  85     New York Dormitory Authority, (Fordham University), (AGC), (BHAC), 5.00%, 7/1/38     88,730      
  1,000     New York Dormitory Authority, (New York University), (AMBAC), (BHAC), 5.00%, 7/1/31(1)     1,008,610      
  345     New York Dormitory Authority, (Pratt Institute), (AGC), 5.00%, 7/1/34     355,278      
  835     New York Dormitory Authority, (Pratt Institute), (AGC), 5.125%, 7/1/39     865,753      
  500     New York Dormitory Authority, (Skidmore College), (FGIC), (NPFG), 5.00%, 7/1/33     509,925      
  850     New York Dormitory Authority, (St. John’s University), (NPFG), 5.25%, 7/1/37     867,382      
  5,425     Oneida County Industrial Development Agency, (Hamilton College), (NPFG), 0.00%, 7/1/32     1,754,608      
 
 
            $ 11,233,108      
 
 
 
 
Insured-Public Education — 3.2%
 
$ 1,075     New York Dormitory Authority, (City University), (AMBAC), 5.25%, 7/1/30   $ 1,055,199      
 
 
            $ 1,055,199      
 
 
 
 
Insured-Special Tax Revenue — 15.8%
 
$ 690     New York Convention Center Development Corp., Hotel Occupancy Tax, (AMBAC), 4.75%, 11/15/45   $ 649,407      
  705     New York Convention Center Development Corp., Hotel Occupancy Tax, (AMBAC), 5.00%, 11/15/44     692,430      
  1,700     Puerto Rico Infrastructure Financing Authority, (AMBAC), 0.00%, 7/1/35     293,556      
  13,970     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/44     1,702,245      
  3,200     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45     362,336      
  2,105     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/46     220,583      
  575     Sales Tax Asset Receivables Corp., (AMBAC), 5.00%, 10/15/29     602,876      
  690     Sales Tax Asset Receivables Corp., (AMBAC), 5.00%, 10/15/32     715,033      
 
 
            $ 5,238,466      
 
 
 
 
Insured-Transportation — 20.8%
 
$ 2,000     Metropolitan Transportation Authority, (AGC), (FGIC), 5.25%, 11/15/31   $ 2,064,320      
  1,000     Metropolitan Transportation Authority, (AGM), (NPFG), 5.00%, 11/15/31     1,031,780      
  510     New York Thruway Authority, (AMBAC), 5.50%, 4/1/20     591,473      
  2,500     Port Authority of New York and New Jersey, (AGM), 5.00%, 11/1/27(1)     2,641,006      
  555     Triborough Bridge and Tunnel Authority, (NPFG), 5.00%, 11/15/32     564,235      
 
 
            $ 6,892,814      
 
 
 
 
Insured-Water and Sewer — 11.5%
 
$ 905     Nassau County Sewer and Storm Water Finance Authority, (BHAC), 5.375%, 11/1/28   $ 1,001,545      
  2,750     New York City Municipal Water Finance Authority, (Water and Sewer System), (AMBAC), (BHAC), 5.00%, 6/15/38(1)     2,798,648      
 
 
            $ 3,800,193      
 
 
 
 
Insured-Water Revenue — 1.1%
 
$ 350     Suffolk County Water Authority, (NPFG), 4.50%, 6/1/25   $ 357,521      
 
 
            $ 357,521      
 
 
 
 
Other Revenue — 0.9%
 
$ 1,100     Brooklyn Arena Local Development Corp., (Barclays Center), 0.00%, 7/15/31   $ 291,280      
 
 
            $ 291,280      
 
 
 
 
Private Education — 2.9%
 
$ 500     New York City Industrial Development Agency, (St. Francis College), 5.00%, 10/1/34   $ 477,575      
  460     New York Dormitory Authority, (Rockefeller University), 5.00%, 7/1/40     486,312      
 
 
            $ 963,887      
 
 
 

 
See notes to financial statements

28

 

 
Eaton Vance New York Municipal Bond Fund II as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Transportation — 2.3%
 
$ 350     Nassau County Bridge Authority, 5.00%, 10/1/35(4)   $ 354,568      
  65     Nassau County Bridge Authority, 5.00%, 10/1/40(4)     65,157      
  340     Triborough Bridge and Tunnel Authority, 5.00%, 11/15/37     354,970      
 
 
            $ 774,695      
 
 
     
Total Tax-Exempt Investments — 167.8%
   
(identified cost $55,729,736)
  $ 55,553,539      
 
 
                     
                     
Short-Term Investments — 2.5%
 
Principal Amount
 		               
(000’s omitted)       Description   Value      
 
 
$ 846     State Street Bank and Trust Euro Time Deposit, 0.01%, 4/1/10   $ 846,281      
 
 
     
Total Short-Term Investments — 2.5%
   
(identified cost $846,281)
  $ 846,281      
 
 
     
Total Investments — 170.3%
   
(identified cost $56,576,017)
  $ 56,399,820      
 
 
             
Auction Preferred Shares Plus Cumulative Unpaid Dividends — (40.0)%
  $ (13,250,161 )    
 
 
             
Other Assets, Less Liabilities — (30.3)%
  $ (10,042,266 )    
 
 
             
Net Assets Applicable to Common Shares — 100.0%
  $ 33,107,393      
 
 
 
The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.
 
AGC - Assured Guaranty Corp.
 
AGM - Assured Guaranty Municipal Corp.
 
AMBAC - AMBAC Financial Group, Inc.
 
BHAC - Berkshire Hathaway Assurance Corp.
 
CIFG - CIFG Assurance North America, Inc.
 
FGIC - Financial Guaranty Insurance Company
 
NPFG - National Public Finance Guaranty Corp.
 
XLCA - XL Capital Assurance, Inc.
 
The Fund invests primarily in debt securities issued by New York municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at March 31, 2010, 92.1% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 0.9% to 32.9% of total investments.
 
(1) Security represents the underlying municipal bond of an inverse floater (see Note 1H).
 
(2) Security (or a portion thereof) has been segregated to cover payable for when-issued securities.
 
(3) Security (or a portion thereof) has been pledged to cover margin requirements on open financial futures contracts.
 
(4) When-issued security.

 
See notes to financial statements

29

 

 
Eaton Vance Ohio Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
 
                     
Tax-Exempt Investments — 152.6%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
General Obligations — 1.7%
 
$ 500     County of Franklin, 5.00%, 12/1/27(1)   $ 543,540      
 
 
            $ 543,540      
 
 
 
 
Hospital — 4.5%
 
$ 500     Miami County, (Upper Valley Medical Center), 5.25%, 5/15/26   $ 500,305      
  1,000     Ohio Higher Educational Facilities Authority, (University Hospital Health Systems, Inc.), 4.75%, 1/15/46     901,800      
 
 
            $ 1,402,105      
 
 
 
 
Insured-Electric Utilities — 19.3%
 
$ 700     American Municipal Power-Ohio, Inc., (Prairie State Energy Campus), (AGC), 5.25%, 2/15/33   $ 729,260      
  2,750     Cleveland Public Power System, (NPFG), 0.00%, 11/15/27     1,061,747      
  1,000     Cleveland Public Power System, (NPFG), 0.00%, 11/15/38     194,990      
  1,670     Ohio Municipal Electric Generation Agency, (NPFG), 0.00%, 2/15/25     763,775      
  5,000     Ohio Municipal Electric Generation Agency, (NPFG), 0.00%, 2/15/27     2,011,600      
  755     Ohio Water Development Authority, (Dayton Power & Light), (FGIC), 4.80%, 1/1/34     739,643      
  500     Puerto Rico Electric Power Authority, (NPFG), 5.25%, 7/1/26     524,570      
 
 
            $ 6,025,585      
 
 
 
 
Insured-General Obligations — 41.7%
 
$ 320     Bowling Green City School District, (AGM), 5.00%, 12/1/34   $ 327,718      
  200     Brookfield Local School District, (AGM), 5.00%, 1/15/30     208,766      
  1,000     Cleveland Municipal School District, (AGM), 5.00%, 12/1/27     1,032,550      
  900     Clyde-Green Springs Exempted Village School District, (AGM), 4.50%, 12/1/31     895,014      
  1,575     Cuyahoga Community College District, (AMBAC), 5.00%, 12/1/32     1,602,310      
  1,000     Milford Exempt Village School District, (AGC), 5.25%, 12/1/36     1,051,800      
  1,400     Olentangy Local School District, (AGC), 5.00%, 12/1/36     1,463,378      
  280     Olentangy Local School District, (AGM), 4.50%, 12/1/32     277,822      
  385     Pickerington Local School District, (NPFG), 4.25%, 12/1/34     376,626      
  2,400     Plain School District, (FGIC), (NPFG), 0.00%, 12/1/27     907,248      
  750     St. Mary’s School District, (AGM), 5.00%, 12/1/35     765,068      
  500     Sylvania City School District, (AGC), 5.00%, 12/1/26     528,625      
  1,000     Sylvania City School District, (AGC), 5.00%, 12/1/32     1,031,520      
  500     Tecumseh School District, (FGIC), (NPFG), 4.75%, 12/1/31     502,045      
  2,000     Wapakoneta City School District, (AGM), 4.75%, 12/1/35     2,041,000      
 
 
            $ 13,011,490      
 
 
 
 
Insured-Hospital — 12.5%
 
$ 820     Hamilton County, (Cincinnati Children’s Hospital), (FGIC), (NPFG), 5.00%, 5/15/32   $ 798,541      
  1,500     Hamilton County, (Cincinnati Children’s Hospital), (FGIC), (NPFG), 5.125%, 5/15/28     1,503,495      
  440     Lorain County, (Catholic Healthcare Partners), (AGM), Variable Rate, 14.656%, 2/1/29(2)(3)(4)     463,320      
  1,250     Ohio Higher Educational Facility Commission, (University Hospital Health Systems, Inc.), (AMBAC), 4.75%, 1/15/46     1,127,250      
 
 
            $ 3,892,606      
 
 
 
 
Insured-Lease Revenue / Certificates of Participation — 4.8%
 
$ 495     Puerto Rico Public Buildings Authority, (CIFG), 5.25%, 7/1/36   $ 482,571      
  235     Puerto Rico Public Buildings Authority, Government Facilities Revenue, (XLCA), 5.25%, 7/1/36     229,099      
  1,000     Summit County, (Civic Theater Project), (AMBAC), 5.00%, 12/1/33     799,510      
 
 
            $ 1,511,180      
 
 
 
 
Insured-Public Education — 31.8%
 
$ 2,000     Cincinnati Technical and Community College, (AMBAC), 5.00%, 10/1/28   $ 1,959,820      
  1,000     Kent State University, (AGC), 5.00%, 5/1/26     1,054,450      
  360     Kent State University, (AGC), 5.00%, 5/1/29     372,470      
  2,000     Miami University, (AGM), (AMBAC), 3.25%, 9/1/26     1,697,400      
  500     Ohio University, (AGM), 5.00%, 12/1/33     513,115      
  1,170     Ohio University, (AGM), 5.25%, 12/1/23     1,237,930      
  1,000     University of Akron, (AGM), 5.00%, 1/1/38     1,031,680      
  1,000     University of Cincinnati, (AMBAC), 5.00%, 6/1/31     1,012,870      
  1,000     Youngstown State University, (AGC), 5.50%, 12/15/33     1,053,040      
 
 
            $ 9,932,775      
 
 
 

 
See notes to financial statements

30

 

 
Eaton Vance Ohio Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
 
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Insured-Sewer Revenue — 3.9%
 
$ 615     Marysville Wastewater Treatment System, (AGC), (XLCA), 4.75%, 12/1/46   $ 609,471      
  625     Marysville Wastewater Treatment System, (AGC), (XLCA), 4.75%, 12/1/47     619,000      
 
 
            $ 1,228,471      
 
 
 
 
Insured-Special Tax Revenue — 10.3%
 
$ 1,335     Hamilton County Sales Tax, (AMBAC), 0.00%, 12/1/23   $ 689,995      
  3,665     Hamilton County Sales Tax, (AMBAC), 0.00%, 12/1/24     1,779,064      
  8,430     Puerto Rico Sales Tax Financing Corp., (AMBAC), 0.00%, 8/1/54     502,512      
  1,525     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45     172,676      
  705     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/46     73,877      
 
 
            $ 3,218,124      
 
 
 
 
Insured-Transportation — 8.0%
 
$ 1,965     Cleveland Airport System, (AGM), 5.00%, 1/1/31   $ 1,966,710      
  500     Puerto Rico Highway and Transportation Authority, (AGC), (CIFG), 5.25%, 7/1/41(5)     514,808      
 
 
            $ 2,481,518      
 
 
 
 
Pooled Loans — 6.9%
 
$ 1,335     Cuyahoga County Port Authority, (Garfield Heights), 5.25%, 5/15/23   $ 983,268      
  1,140     Rickenbacker Port Authority, Oasbo Expanded Asset Pool Loan, 5.375%, 1/1/32(5)     1,182,362      
 
 
            $ 2,165,630      
 
 
 
 
Private Education — 7.2%
 
$ 850     Ohio Higher Educational Facilities Authority, (John Carroll University), 5.25%, 11/15/33   $ 852,720      
  1,000     Ohio Higher Educational Facilities Authority, (Oberlin College), 5.00%, 10/1/33     1,025,950      
  350     Ohio Higher Educational Facility Commission, (Kenyon College), 5.00%, 7/1/44     353,892      
 
 
            $ 2,232,562      
 
 
     
Total Tax-Exempt Investments — 152.6%
   
(identified cost $47,148,114)
  $ 47,645,586      
 
 
                     
                     
                     
                     
                     
Short-Term Investments — 3.2%
 
Principal Amount
 		               
(000’s omitted)       Description   Value      
 
 
$ 1,004     State Street Bank and Trust Euro Time Deposit, 0.01%, 4/1/10   $ 1,003,709      
 
 
     
Total Short-Term Investments — 3.2%
   
(identified cost $1,003,709)
  $ 1,003,709      
 
 
     
Total Investments — 155.8%
   
(identified cost $48,151,823)
  $ 48,649,295      
 
 
     
Auction Preferred Shares Plus Cumulative
   
Unpaid Dividends — (54.4)%
  $ (17,001,064 )    
 
 
             
Other Assets, Less Liabilities — (1.4)%
  $ (420,773 )    
 
 
             
Net Assets Applicable to Common Shares — 100.0%
  $ 31,227,458      
 
 
 
The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.
 
AGC - Assured Guaranty Corp.
 
AGM - Assured Guaranty Municipal Corp.
 
AMBAC - AMBAC Financial Group, Inc.
 
CIFG - CIFG Assurance North America, Inc.
 
FGIC - Financial Guaranty Insurance Company
 
NPFG - National Public Finance Guaranty Corp.
 
XLCA - XL Capital Assurance, Inc.
 
The Fund invests primarily in debt securities issued by Ohio municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at March 31, 2010, 84.9% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 2.1% to 25.6% of total investments.
 
(1) Security (or a portion thereof) has been pledged to cover margin requirements on open financial contracts.
 
(2) Security has been issued as a leveraged inverse floater bond. The stated interest rate represents the rate in effect at March 31, 2010.
 
(3) Security exempt from registration pursuant to Rule 144A under the Securities Act of 1933. These securities may be sold in certain transactions and remain exempt from registration, normally to qualified institutional buyers. At March 31, 2010, the aggregate value of these securities is $463,320 or 1.5% of the Fund’s net assets applicable to common shares.

 
See notes to financial statements

31

 

 
Eaton Vance Ohio Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
 
(4) Security is subject to a shortfall agreement which may require the Fund to pay amounts to a counterparty in the event of a significant decline in the market value of the security underlying the inverse floater. In case of a shortfall, the maximum potential amount of payments the Fund could ultimately be required to make under the agreement is $1,320,000. However, such shortfall payment would be reduced by the proceeds from the sale of the security underlying the inverse floater.
 
(5) Security represents the underlying municipal bond of an inverse floater (see Note 1H).

 
See notes to financial statements

32

 

Eaton Vance Pennsylvania Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited)
 
                     
Tax-Exempt Investments — 161.1%
 
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
 
Hospital — 10.9%
 
$ 500     Lancaster County Hospital Authority, (Lancaster General Hospital), 4.50%, 3/15/36   $ 461,815      
  1,455     Lehigh County General Purpose Authority, (Lehigh Valley Health Network), 5.25%, 7/1/32     1,445,441      
  750     Pennsylvania Higher Educational Facilities Authority, (UPMC Health System), 6.00%, 1/15/31     790,417      
  675     Pennsylvania Higher Educational Facilties Authority, (University of Pittsburgh Medical Center), 5.00%, 5/15/31     674,960      
  820     Philadelphia Hospitals and Higher Education Facilities Authority, (Children’s Hospital), 4.50%, 7/1/37     765,068      
 
 
            $ 4,137,701      
 
 
 
 
Insured-Electric Utilities — 7.2%
 
$ 1,990     Lehigh County Industrial Development Authority, (PPL Electric Utilities Corp.), (FGIC), (NPFG), 4.75%, 2/15/27   $ 1,964,886      
  750     Puerto Rico Electric Power Authority, (FGIC), (NPFG), 5.25%, 7/1/35     756,233      
 
 
            $ 2,721,119      
 
 
 
 
Insured-Escrowed / Prerefunded — 0.7%
 
$ 270     Southcentral General Authority, (Wellspan Health), (NPFG), Escrowed to Maturity, 5.25%, 5/15/31   $ 286,292      
 
 
            $ 286,292      
 
 
 
 
Insured-General Obligations — 31.7%
 
$ 1,650     Armstrong County, (NPFG), 5.40%, 6/1/31   $ 1,659,124      
  1,250     Bethlehem Area School District, (AGM), 5.25%, 1/15/25     1,327,550      
  660     Centennial School District, (AGM), 5.25%, 12/15/37     688,519      
  1,350     Central Greene School District, (AGM), 5.00%, 2/15/35     1,382,562      
  1,000     Erie School District, (AMBAC), 0.00%, 9/1/30     349,210      
  500     Harrisburg School District, (AGC), 5.00%, 11/15/33     515,490      
  2,555     McKeesport School District, (NPFG), 0.00%, 10/1/21     1,546,286      
  1,500     Norwin School District, (AGM), 3.25%, 4/1/27     1,288,530      
  1,500     Reading School District, (AGM), 5.00%, 3/1/35     1,538,265      
  1,000     Scranton School District, (AGM), 5.00%, 7/15/38     1,019,960      
  2,550     Shaler Area School District, (XLCA), 0.00%, 9/1/33     720,324      
 
 
            $ 12,035,820      
 
 
 
 
Insured-Hospital — 8.8%
 
$ 250     Allegheny County Hospital Development Authority, (UPMC Health System), (NPFG), 6.00%, 7/1/24   $ 285,985      
  500     Centre County Hospital Authority, (Mount Nittany Medical Center), (AGC), 6.25%, 11/15/44     520,040      
  1,620     Lehigh County General Purpose Authority, (Lehigh Valley Health Network), (AGM), 5.00%, 7/1/35(1)     1,610,709      
  1,000     Washington County Hospital Authority, (Washington Hospital), (AMBAC), 5.125%, 7/1/28     912,960      
 
 
            $ 3,329,694      
 
 
 
 
Insured-Industrial Development Revenue — 3.1%
 
$ 150     Pennsylvania Economic Development Financing Authority, (Aqua Pennsylvania, Inc. Project), (BHAC), 5.00%, 10/1/39   $ 153,995      
  1,000     Pennsylvania Economic Development Financing Authority, (Aqua Pennsylvania, Inc. Project), (BHAC), 5.00%, 10/1/39(1)     1,026,630      
 
 
            $ 1,180,625      
 
 
 
 
Insured-Lease Revenue / Certificates of Participation — 4.6%
 
$ 500     Commonwealth Financing Authority, (AGC), 5.00%, 6/1/31   $ 518,580      
  1,215     Philadelphia Authority for Industrial Development, (One Benjamin Franklin), (AGM), 4.75%, 2/15/27     1,244,597      
 
 
            $ 1,763,177      
 
 
 
 
Insured-Private Education — 12.9%
 
$ 1,000     Chester County Industrial Development Authority, Educational Facility, (Westtown School), (AMBAC), 5.00%, 1/1/31   $ 1,002,910      
  1,675     Pennsylvania Higher Educational Facilities Authority, (Drexel University), (NPFG), 5.00%, 5/1/37     1,692,839      
  1,755     Pennsylvania Higher Educational Facilities Authority, (Temple University), (NPFG), 4.50%, 4/1/36     1,689,889      
  500     Pennsylvania Higher Educational Facilities Authority, (University of the Sciences in Philadelphia), (AGC), 5.00%, 11/1/37     511,185      
 
 
            $ 4,896,823      
 
 
 
 
Insured-Public Education — 11.3%
 
$ 500     Lycoming County Authority, (Pennsylvania College of Technology), (AGC), 5.50%, 10/1/37   $ 521,000      
  1,200     Lycoming County Authority, (Pennsylvania College of Technology), (AMBAC), 5.25%, 5/1/32     1,134,024      
  1,000     Pennsylvania Higher Educational Facilities Authority, (Clarion University Foundation), (XLCA), 5.00%, 7/1/33     820,250      
  500     State Public School Building Authority, (Delaware County Community College), (AGM), 5.00%, 10/1/27     529,030      

 
See notes to financial statements

33

 

 
Eaton Vance Pennsylvania Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Principal Amount
 		               
(000’s omitted)       Security   Value      
 
 
Insured-Public Education (continued)
 
                     
$ 375     State Public School Building Authority, (Delaware County Community College), (AGM), 5.00%, 10/1/29   $ 392,610      
  875     State Public School Building Authority, (Delaware County Community College), (AGM), 5.00%, 10/1/32     904,715      
 
 
            $ 4,301,629      
 
 
 
 
Insured-Sewer Revenue — 17.0%
 
$ 300     Allegheny County Sanitation Authority, (BHAC), (FGIC), 5.00%, 12/1/32   $ 309,270      
  1,500     Allegheny County Sanitation Authority, (BHAC), (NPFG), 5.00%, 12/1/22     1,591,065      
  1,000     Ambridge Borough Municipal Authority, Sewer Revenue, (AGM), 4.60%, 10/15/41     941,660      
  1,920     Erie Sewer Authority, (AMBAC), 0.00%, 12/1/26     705,293      
  1,455     Erie Sewer Authority, Series A, (AMBAC), 0.00%, 12/1/25     572,775      
  2,155     Erie Sewer Authority, Series B, (AMBAC), 0.00%, 12/1/25     848,338      
  1,500     University Area Joint Authority, (NPFG), 5.00%, 11/1/26     1,501,965      
 
 
            $ 6,470,366      
 
 
 
 
Insured-Special Tax Revenue — 14.6%
 
$ 3,725     Pittsburgh and Allegheny County Public Auditorium Authority, (AMBAC), 5.00%, 2/1/29   $ 3,401,893      
  22,015     Puerto Rico Sales Tax Financing Corp., (AMBAC), 0.00%, 8/1/54     1,312,314      
  1,770     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/44     215,675      
  3,510     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/45     397,437      
  2,220     Puerto Rico Sales Tax Financing Corp., (NPFG), 0.00%, 8/1/46     232,634      
 
 
            $ 5,559,953      
 
 
 
 
Insured-Transportation — 20.6%
 
$ 2,000     Allegheny County Port Authority, (FGIC), (NPFG), 5.00%, 3/1/25   $ 2,028,000      
  1,000     Allegheny County Port Authority, (FGIC), (NPFG), 5.00%, 3/1/29     1,009,590      
  2,075     Pennsylvania Turnpike Commission, (AGM), 5.25%, 7/15/30     2,306,985      
  295     Philadelphia, Airport Revenue, (AGC), 5.375%, 6/15/29     310,529      
  2,100     Puerto Rico Highway and Transportation Authority, (AGC), (CIFG), 5.25%, 7/1/41(1)     2,162,191      
 
 
            $ 7,817,295      
 
 
 
Insured-Utilities — 2.2%
 
$ 915     Philadelphia Gas Works Revenue, (AMBAC), 5.00%, 10/1/37   $ 825,412      
 
 
            $ 825,412      
 
 
 
 
Insured-Water and Sewer — 0.4%
 
$ 150     Saxonburg Water and Sewer Authority, (AGC), 5.00%, 3/1/35   $ 151,677      
 
 
            $ 151,677      
 
 
 
 
Insured-Water Revenue — 3.6%
 
$ 1,500     Philadelphia Water and Wastewater, (AMBAC), 4.25%, 11/1/31   $ 1,373,955      
 
 
            $ 1,373,955      
 
 
 
 
Private Education — 10.7%
 
$ 625     Pennsylvania Higher Educational Facilities Authority, (Thomas Jefferson University), 5.00%, 3/1/40   $ 633,763      
  2,900     Pennsylvania Higher Educational Facilities Authority, (University of Pennsylvania), 4.75%, 7/15/35     2,915,428      
  500     Washington County Industrial Development Authority, (Washington and Jefferson College), 5.25%, 11/1/30     517,800      
 
 
            $ 4,066,991      
 
 
 
 
Senior Living / Life Care — 0.5%
 
$ 200     Montgomery County Industrial Development Authority, (Foulkeways at Gwynedd), 5.00%, 12/1/24   $ 192,736      
 
 
            $ 192,736      
 
 
 
 
Special Tax Revenue — 0.3%
 
$ 110     Virgin Islands Public Finance Authority, 6.75%, 10/1/37   $ 119,713      
 
 
            $ 119,713      
 
 
     
Total Tax-Exempt Investments — 161.1%
   
(identified cost $63,124,312)
  $ 61,230,978      
 
 
                     
                     
 

 
See notes to financial statements

34

 

 
Eaton Vance Pennsylvania Municipal Bond Fund as of March 31, 2010
 
PORTFOLIO OF INVESTMENTS (Unaudited) CONT’D
 
                     
Short-Term Investments — 1.8%
 
Principal Amount
 		               
(000’s omitted)       Description   Value      
 
 
$ 682     State Street Bank and Trust Euro Time Deposit, 0.01%, 4/1/10   $ 682,191      
 
 
     
Total Short-Term Investments — 1.8%
   
(identified cost $682,191)
  $ 682,191      
 
 
     
Total Investments — 162.9%
   
(identified cost $63,806,503)
  $ 61,913,169      
 
 
             
Auction Preferred Shares Plus Cumulative Unpaid Dividends — (57.2)%
  $ (21,726,632 )    
 
 
             
Other Assets, Less Liabilities — (5.7)%
  $ (2,175,912 )    
 
 
             
Net Assets Applicable to Common Shares — 100.0%
  $ 38,010,625      
 
 
 
The percentage shown for each investment category in the Portfolio of Investments is based on net assets applicable to common shares.
 
AGC - Assured Guaranty Corp.
 
AGM - Assured Guaranty Municipal Corp.
 
AMBAC - AMBAC Financial Group, Inc.
 
BHAC - Berkshire Hathaway Assurance Corp.
 
CIFG - CIFG Assurance North America, Inc.
 
FGIC - Financial Guaranty Insurance Company
 
NPFG - National Public Finance Guaranty Corp.
 
XLCA - XL Capital Assurance, Inc.
 
The Fund invests primarily in debt securities issued by Pennsylvania municipalities. The ability of the issuers of the debt securities to meet their obligations may be affected by economic developments in a specific industry or municipality. In order to reduce the risk associated with such economic developments, at March 31, 2010, 85.1% of total investments are backed by bond insurance of various financial institutions and financial guaranty assurance agencies. The aggregate percentage insured by an individual financial institution ranged from 2.5% to 27.2% of total investments.
 
(1) Security represents the underlying municipal bond of an inverse floater (see Note 1H).

 
See notes to financial statements

35

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS (Unaudited)
Statements of Assets and Liabilities
 
                                     
As of March 31, 2010   Municipal Fund II     California Fund II     Massachusetts Fund     Michigan Fund      
 
 
 
Assets
 
Investments —
                                   
Identified cost
  $ 232,060,161     $ 86,478,915     $ 41,081,576     $ 33,487,146      
Unrealized appreciation (depreciation)
    (8,573,808 )     (4,795,796 )     760,351       583,735      
 
 
Investments, at value
  $ 223,486,353     $ 81,683,119     $ 41,841,927     $ 34,070,881      
 
 
Interest receivable
  $ 2,875,464     $ 801,974     $ 535,449     $ 475,684      
Receivable for investments sold
    —       —       170,629       —      
Deferred debt issuance costs
    132,080       24,350       5,942       —      
 
 
Total assets
  $ 226,493,897     $ 82,509,443     $ 42,553,947     $ 34,546,565      
 
 
                                     
                                     
 
Liabilities
 
Payable for floating rate notes issued
  $ 57,365,000     $ 9,575,000     $ 2,460,000     $ —      
Payable for investments purchased
    2,254,979       —       1,036,064       —      
Payable for when-issued securities
    1,105,563       1,091,136       1,054,010       —      
Payable for variation margin on open financial futures contracts
    66,406       20,157       —       4,063      
Payable for open swap contracts
    79,232       42,983       20,336       16,198      
Payable to affiliates:
                                   
Investment adviser fee
    97,719       37,354       18,679       16,212      
Interest expense and fees payable
    135,847       21,558       6,491       —      
Accrued expenses
    69,372       41,660       39,349       36,564      
 
 
Total liabilities
  $ 61,174,118     $ 10,829,848     $ 4,634,929     $ 73,037      
 
 
Auction preferred shares at liquidation value plus cumulative unpaid dividends
  $ 44,703,356     $ 25,702,251     $ 13,576,020     $ 13,325,162      
 
 
Net assets applicable to common shares
  $ 120,616,423     $ 45,977,344     $ 24,342,998     $ 21,148,366      
 
 
                                     
                                     
 
Sources of Net Assets
 
Common shares, $0.01 par value, unlimited number of shares authorized
  $ 99,610     $ 38,714     $ 17,607     $ 15,120      
Additional paid-in capital
    141,176,086       54,853,852       24,946,069       21,415,488      
Accumulated net realized loss
    (13,624,000 )     (4,502,160 )     (1,497,045 )     (1,017,861 )    
Accumulated undistributed net investment income
    1,625,991       401,681       136,352       166,617      
Net unrealized appreciation (depreciation)
    (8,661,264 )     (4,814,743 )     740,015       569,002      
 
 
Net assets applicable to common shares
  $ 120,616,423     $ 45,977,344     $ 24,342,998     $ 21,148,366      
 
 
Auction Preferred Shares Issued and Outstanding (Liquidation preference of $25,000 per share)
    1,788       1,028       543       533      
 
 
                                     
                                     
 
Common Shares Outstanding
 
      9,961,028       3,871,379       1,760,651       1,511,977      
 
 
                                     
                                     
 
Net Asset Value Per Common Share
 
Net assets applicable to common shares ¸ common shares issued and outstanding
  $ 12.11     $ 11.88     $ 13.83     $ 13.99      
 
 

 
See notes to financial statements

36

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS (Unaudited) CONT’D
 
Statements of Assets and Liabilities
 
                                     
As of March 31, 2010   New Jersey Fund     New York Fund II     Ohio Fund     Pennsylvania Fund      
 
 
 
Assets
 
Investments —
                                   
Identified cost
  $ 60,117,674     $ 56,576,017     $ 48,151,823     $ 63,806,503      
Unrealized appreciation (depreciation)
    769,927       (176,197 )     497,472       (1,893,334 )    
 
 
Investments, at value
  $ 60,887,601     $ 56,399,820     $ 48,649,295     $ 61,913,169      
 
 
Interest receivable
  $ 624,607     $ 785,368     $ 632,192     $ 738,009      
Receivable for investments sold
    —       1,049,896       60,000       28,820      
Deferred debt issuance costs
    8,047       21,575       —       —      
 
 
Total assets
  $ 61,520,255     $ 58,256,659     $ 49,341,487     $ 62,679,998      
 
 
                                     
                                     
 
Liabilities
 
Payable for floating rate notes issued
  $ 6,346,000     $ 11,335,000     $ 1,010,000     $ 2,850,000      
Payable for when-issued securities
    —       415,750       —       —      
Payable for variation margin on open financial futures contracts
    30,469       14,063       20,156       —      
Payable for open swap contracts
    29,484       43,863       19,717       9,682      
Payable to affiliates:
                                   
Investment adviser fee
    27,253       26,066       23,156       29,618      
Interest expense and fees payable
    17,532       23,340       2,119       5,753      
Accrued expenses
    40,968       41,023       37,817       47,688      
 
 
Total liabilities
  $ 6,491,706     $ 11,899,105     $ 1,112,965     $ 2,942,741      
 
 
Auction preferred shares at liquidation value plus cumulative unpaid dividends
  $ 19,600,475     $ 13,250,161     $ 17,001,064     $ 21,726,632      
 
 
Net assets applicable to common shares
  $ 35,428,074     $ 33,107,393     $ 31,227,458     $ 38,010,625      
 
 
                                     
                                     
 
Sources of Net Assets
 
Common shares, $0.01 par value, unlimited number of shares authorized
  $ 25,781     $ 25,595     $ 25,224     $ 29,485      
Additional paid-in capital
    36,531,293       36,257,840       35,720,016       41,778,950      
Accumulated net realized loss
    (2,290,915 )     (3,286,440 )     (5,230,411 )     (2,309,134 )    
Accumulated undistributed net investment income
    297,793       313,688       238,830       414,340      
Net unrealized appreciation (depreciation)
    864,122       (203,290 )     473,799       (1,903,016 )    
 
 
Net assets applicable to common shares
  $ 35,428,074     $ 33,107,393     $ 31,227,458     $ 38,010,625      
 
 
Auction Preferred Shares Issued and Outstanding (Liquidation preference of $25,000 per share)
    784       530       680       869      
 
 
                                     
                                     
 
Common Shares Outstanding
 
      2,578,086       2,559,451       2,522,366       2,948,530      
 
 
                                     
                                     
 
Net Asset Value Per Common Share
 
Net assets applicable to common shares ¸ common shares issued and outstanding
  $ 13.74     $ 12.94     $ 12.38     $ 12.89      
 
 

 
See notes to financial statements

37

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS (Unaudited) CONT’D
 
 
Statements of Operations
 
                                     
For the Six Months Ended March 31, 2010   Municipal Fund II     California Fund II     Massachusetts Fund     Michigan Fund      
 
 
 
Investment Income
 
Interest
  $ 5,752,079     $ 2,113,111     $ 958,720     $ 859,381      
 
 
Total investment income
  $ 5,752,079     $ 2,113,111     $ 958,720     $ 859,381      
 
 
                                     
                                     
 
Expenses
 
Investment adviser fee
  $ 569,593     $ 219,383     $ 109,460     $ 95,142      
Trustees’ fees and expenses
    3,680       1,568       910       824      
Custodian fee
    50,327       19,142       12,941       12,158      
Transfer and dividend disbursing agent fees
    6,579       5,162       5,301       5,379      
Legal and accounting services
    26,298       17,847       14,153       13,114      
Printing and postage
    25,014       6,207       6,222       6,404      
Interest expense and fees
    216,166       37,443       8,266       —      
Preferred shares service fee
    33,472       19,245       10,165       9,977      
Miscellaneous
    29,648       22,606       19,294       18,692      
 
 
Total expenses
  $ 960,777     $ 348,603     $ 186,712     $ 161,690      
 
 
Deduct —
                                   
Reduction of custodian fee
  $ 246     $ 84     $ 90     $ 54      
Allocation of expenses to affiliate
    16,776       6,532       3,233       2,810      
 
 
Total expense reductions
  $ 17,022     $ 6,616     $ 3,323     $ 2,864      
 
 
                                     
Net expenses
  $ 943,755     $ 341,987     $ 183,389     $ 158,826      
 
 
                                     
Net investment income
  $ 4,808,324     $ 1,771,124     $ 775,331     $ 700,555      
 
 
                                     
                                     
 
Realized and Unrealized Gain (Loss)
 
Net realized gain (loss) —
                                   
Investment transactions
  $ 353,088     $ (76,816 )   $ (277,433 )   $ (130,235 )    
Financial futures contracts
    (37,940 )     24,593       —       (6,307 )    
Swap contracts
    220,800       83,792       38,676       33,144      
 
 
Net realized gain (loss)
  $ 535,948     $ 31,569     $ (238,757 )   $ (103,398 )    
 
 
Change in unrealized appreciation (depreciation) —
                                   
Investments
  $ (8,852,586 )   $ (4,489,696 )   $ (1,309,821 )   $ (1,124,090 )    
Financial futures contracts
    331,904       109,179       —       24,538      
Swap contracts
    259,576       152,316       72,372       56,901      
 
 
Net change in unrealized appreciation (depreciation)
  $ (8,261,106 )   $ (4,228,201 )   $ (1,237,449 )   $ (1,042,651 )    
 
 
                                     
Net realized and unrealized loss
  $ (7,725,158 )   $ (4,196,632 )   $ (1,476,206 )   $ (1,146,049 )    
 
 
Distributions to preferred shareholders —
                                   
From net investment income
  $ (86,599 )   $ (49,087 )   $ (25,832 )   $ (25,297 )    
 
 
                                     
Net decrease in net assets from operations
  $ (3,003,433 )   $ (2,474,595 )   $ (726,707 )   $ (470,791 )    
 
 

 
See notes to financial statements

38

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS (Unaudited) CONT’D
 
Statements of Operations
 
                                     
For the Six Months Ended March 31, 2010   New Jersey Fund     New York Fund II     Ohio Fund     Pennsylvania Fund      
 
 
 
Investment Income
 
Interest
  $ 1,489,511     $ 1,367,766     $ 1,265,089     $ 1,557,504      
 
 
Total investment income
  $ 1,489,511     $ 1,367,766     $ 1,265,089     $ 1,557,504      
 
 
                                     
                                     
 
Expenses
 
Investment adviser fee
  $ 159,301     $ 152,730     $ 135,842     $ 171,393      
Trustees’ fees and expenses
    1,210       1,171       1,072       1,279      
Custodian fee
    17,316       18,088       14,832       18,169      
Transfer and dividend disbursing agent fees
    5,729       5,112       5,062       5,034      
Legal and accounting services
    18,476       19,737       18,349       16,749      
Printing and postage
    8,925       9,344       4,864       10,457      
Interest expense and fees
    28,143       44,419       1,946       12,628      
Preferred shares service fee
    14,676       9,921       12,729       16,267      
Miscellaneous
    21,215       19,116       18,272       24,766      
 
 
Total expenses
  $ 274,991     $ 279,638     $ 212,968     $ 276,742      
 
 
Deduct —
                                   
Reduction of custodian fee
  $ 140     $ 213     $ 53     $ 118      
Allocation of expenses to affiliate
    4,638       4,503       4,002       5,053      
 
 
Total expense reductions
  $ 4,778     $ 4,716     $ 4,055     $ 5,171      
 
 
                                     
Net expenses
  $ 270,213     $ 274,922     $ 208,913     $ 271,571      
 
 
                                     
Net investment income
  $ 1,219,298     $ 1,092,844     $ 1,056,176     $ 1,285,933      
 
 
                                     
                                     
 
Realized and Unrealized Gain (Loss)
 
Net realized gain (loss) —
                                   
Investment transactions
  $ 106,532     $ (375,259 )   $ 21,927     $ (462,622 )    
Financial futures contracts
    —       18,330       (18,733 )     —      
Swap contracts
    56,172       56,253       54,281       127,382      
 
 
Net realized gain (loss)
  $ 162,704     $ (300,676 )   $ 57,475     $ (335,240 )    
 
 
Change in unrealized appreciation (depreciation) —
                                   
Investments
  $ (2,650,836 )   $ (1,641,311 )   $ (1,814,042 )   $ (2,815,904 )    
Financial futures contracts
    123,679       75,469       101,526       —      
Swap contracts
    104,899       164,780       64,811       164,483      
 
 
Net change in unrealized appreciation (depreciation)
  $ (2,422,258 )   $ (1,401,062 )   $ (1,647,705 )   $ (2,651,421 )    
 
 
                                     
Net realized and unrealized loss
  $ (2,259,554 )   $ (1,701,738 )   $ (1,590,230 )   $ (2,986,661 )    
 
 
Distributions to preferred shareholders —
                                   
From net investment income
  $ (38,046 )   $ (25,546 )   $ (32,910 )   $ (40,986 )    
 
 
                                     
Net decrease in net assets from operations
  $ (1,078,302 )   $ (634,440 )   $ (566,964 )   $ (1,741,714 )    
 
 

 
See notes to financial statements

39

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS (Unaudited) CONT’D
 
 
Statements of Changes in Net Assets
 
                                     
For the Six Months Ended March 31, 2010                            
Increase (Decrease) in Net Assets   Municipal Fund II     California Fund II     Massachusetts Fund     Michigan Fund      
 
From operations —
                                   
Net investment income
  $ 4,808,324     $ 1,771,124     $ 775,331     $ 700,555      
Net realized gain (loss) from investment transactions, financial futures contracts and swap contracts
    535,948       31,569       (238,757 )     (103,398 )    
Net change in unrealized appreciation (depreciation) from investments, financial futures contracts and swap contracts
    (8,261,106 )     (4,228,201 )     (1,237,449 )     (1,042,651 )    
Distributions to preferred shareholders —
                                   
From net investment income
    (86,599 )     (49,087 )     (25,832 )     (25,297 )    
 
 
Net decrease in net assets from operations
  $ (3,003,433 )   $ (2,474,595 )   $ (726,707 )   $ (470,791 )    
 
 
Distributions to common shareholders —
                                   
From net investment income
  $ (4,634,343 )   $ (1,653,222 )   $ (733,113 )   $ (656,945 )    
 
 
Total distributions to common shareholders
  $ (4,634,343 )   $ (1,653,222 )   $ (733,113 )   $ (656,945 )    
 
 
Capital share transactions —
                                   
Reinvestment of distributions to common shareholders
  $ 104,513     $ 24,778     $ 32,229     $ —      
 
 
Net increase in net assets from capital share transactions
  $ 104,513     $ 24,778     $ 32,229     $ —      
 
 
                                     
Net decrease in net assets
  $ (7,533,263 )   $ (4,103,039 )   $ (1,427,591 )   $ (1,127,736 )    
 
 
                                     
                                     
 
Net Assets Applicable to Common Shares
 
At beginning of period
  $ 128,149,686     $ 50,080,383     $ 25,770,589     $ 22,276,102      
 
 
At end of period
  $ 120,616,423     $ 45,977,344     $ 24,342,998     $ 21,148,366      
 
 
                                     
                                     
 
Accumulated undistributed net investment
income included in net assets applicable to
common shares
 
At end of period
  $ 1,625,991     $ 401,681     $ 136,352     $ 166,617      
 
 

 
See notes to financial statements

40

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS (Unaudited) CONT’D
 
Statements of Changes in Net Assets
 
                                     
For the Six Months Ended March 31, 2010                            
Increase (Decrease) in Net Assets   New Jersey Fund     New York Fund II     Ohio Fund     Pennsylvania Fund      
 
From operations —
                                   
Net investment income
  $ 1,219,298     $ 1,092,844     $ 1,056,176     $ 1,285,933      
Net realized gain (loss) from investment transactions, financial futures contracts and swap contracts
    162,704       (300,676 )     57,475       (335,240 )    
Net change in unrealized appreciation (depreciation) from investments, financial futures contracts and swap contracts
    (2,422,258 )     (1,401,062 )     (1,647,705 )     (2,651,421 )    
Distributions to preferred shareholders —
                                   
From net investment income
    (38,046 )     (25,546 )     (32,910 )     (40,986 )    
 
 
Net decrease in net assets from operations
  $ (1,078,302 )   $ (634,440 )   $ (566,964 )   $ (1,741,714 )    
 
 
Distributions to common shareholders —
                                   
From net investment income
  $ (1,172,276 )   $ (1,119,967 )   $ (948,017 )   $ (1,227,720 )    
 
 
Total distributions to common shareholders
  $ (1,172,276 )   $ (1,119,967 )   $ (948,017 )   $ (1,227,720 )    
 
 
Capital share transactions —
                                   
Reinvestment of distributions to common shareholders
  $ 50,630     $ 14,901     $ 32,332     $ 23,669      
 
 
Net increase in net assets from capital share transactions
  $ 50,630     $ 14,901     $ 32,332     $ 23,669      
 
 
                                     
Net decrease in net assets
  $ (2,199,948 )   $ (1,739,506 )   $ (1,482,649 )   $ (2,945,765 )    
 
 
                                     
                                     
 
Net Assets Applicable to Common Shares
 
At beginning of period
  $ 37,628,022     $ 34,846,899     $ 32,710,107     $ 40,956,390      
 
 
At end of period
  $ 35,428,074     $ 33,107,393     $ 31,227,458     $ 38,010,625      
 
 
                                     
                                     
 
Accumulated undistributed net investment
income included in net assets applicable to
common shares
 
At end of period
  $ 297,793     $ 313,688     $ 238,830     $ 414,340      
 
 

 
See notes to financial statements

41

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
Statements of Changes in Net Assets
 
                                     
For the Year Ended September 30, 2009                            
Increase (Decrease) in Net Assets   Municipal Fund II     California Fund II     Massachusetts Fund     Michigan Fund      
 
From operations —
                                   
Net investment income
  $ 9,377,413     $ 3,390,514     $ 1,583,454     $ 1,399,076      
Net realized loss from investment transactions, financial futures contracts and swap contracts
    (10,730,783 )     (3,248,977 )     (1,136,806 )     (480,219 )    
Net change in unrealized appreciation (depreciation) from investments, financial futures contracts and swap contracts
    28,703,972       9,442,700       5,497,042       3,670,791      
Distributions to preferred shareholders —
                                   
From net investment income
    (578,404 )     (325,864 )     (174,091 )     (170,213 )    
 
 
Net increase in net assets from operations
  $ 26,772,198     $ 9,258,373     $ 5,769,599     $ 4,419,435      
 
 
Distributions to common shareholders —
                                   
From net investment income
  $ (8,437,461 )   $ (2,954,634 )   $ (1,332,810 )   $ (1,152,527 )    
 
 
Total distributions to common shareholders
  $ (8,437,461 )   $ (2,954,634 )   $ (1,332,810 )   $ (1,152,527 )    
 
 
Capital share transactions —
                                   
Reinvestment of distributions to common shareholders
  $ 167,262     $ 58,277     $ 22,988     $ 1,776      
 
 
Net increase in net assets from capital share transactions
  $ 167,262     $ 58,277     $ 22,988     $ 1,776      
 
 
                                     
Net increase in net assets
  $ 18,501,999     $ 6,362,016     $ 4,459,777     $ 3,268,684      
 
 
                                     
                                     
 
Net Assets Applicable to Common Shares
 
At beginning of year
  $ 109,647,687     $ 43,718,367     $ 21,310,812     $ 19,007,418      
 
 
At end of year
  $ 128,149,686     $ 50,080,383     $ 25,770,589     $ 22,276,102      
 
 
                                     
                                     
 
Accumulated undistributed net investment
income included in net assets applicable to
common shares
 
At end of year
  $ 1,538,609     $ 332,866     $ 119,966     $ 148,304      
 
 

 
See notes to financial statements

42

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
Statements of Changes in Net Assets
 
                                     
For the Year Ended September 30, 2009                            
Increase (Decrease) in Net Assets   New Jersey Fund     New York Fund II     Ohio Fund     Pennsylvania Fund      
 
From operations —
                                   
Net investment income
  $ 2,382,638     $ 2,191,347     $ 2,130,212     $ 2,618,797      
Net realized loss from investment transactions, financial futures contracts and swap contracts
    (2,484,603 )     (2,557,907 )     (4,193,790 )     (1,622,894 )    
Net change in unrealized appreciation (depreciation) from investments, financial futures contracts and swap contracts
    9,526,226       7,911,044       8,199,680       7,883,733      
Distributions to preferred shareholders —
                                   
From net investment income
    (227,579 )     (168,414 )     (254,584 )     (210,410 )    
From net realized gain
    (40,658 )     —       —       (132,368 )    
 
 
Net increase in net assets from operations
  $ 9,156,024     $ 7,376,070     $ 5,881,518     $ 8,536,858      
 
 
Distributions to common shareholders —
                                   
From net investment income
  $ (2,106,960 )   $ (2,014,492 )   $ (1,729,034 )   $ (2,217,812 )    
From net realized gain
    (264,989 )     —       —       (803,880 )    
 
 
Total distributions to common shareholders
  $ (2,371,949 )   $ (2,014,492 )   $ (1,729,034 )   $ (3,021,692 )    
 
 
Capital share transactions —
                                   
Reinvestment of distributions to common shareholders
  $ 68,403     $ 26,563     $ 63,002     $ 28,342      
 
 
Net increase in net assets from capital share transactions
  $ 68,403     $ 26,563     $ 63,002     $ 28,342      
 
 
                                     
Net increase in net assets
  $ 6,852,478     $ 5,388,141     $ 4,215,486     $ 5,543,508      
 
 
                                     
                                     
 
Net Assets Applicable to Common Shares
 
At beginning of year
  $ 30,775,544     $ 29,458,758     $ 28,494,621     $ 35,412,882      
 
 
At end of year
  $ 37,628,022     $ 34,846,899     $ 32,710,107     $ 40,956,390      
 
 
                                     
                                     
 
Accumulated undistributed net investment
income included in net assets applicable to
common shares
 
At end of year
  $ 288,817     $ 366,357     $ 163,581     $ 397,113      
 
 

 
See notes to financial statements

43

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS (Unaudited) CONT’D
Statements of Cash Flows
 
                                     
For the Six Months Ended March 31, 2010                            
Cash Flows From Operating Activities   Municipal Fund II     California Fund II     New Jersey Fund     New York Fund II      
 
Net decrease in net assets from operations
  $ (3,003,433 )   $ (2,474,595 )   $ (1,078,302 )   $ (634,440 )    
Distributions to preferred shareholders
    86,599       49,087       38,046       25,546      
 
 
Net decrease in net assets from operations excluding distributions to preferred shareholders
  $ (2,916,834 )   $ (2,425,508 )   $ (1,040,256 )   $ (608,894 )    
Adjustments to reconcile net decrease in net assets from operations to net
cash provided by operating activities:
                                   
Investments purchased
    (13,873,404 )     (2,971,375 )     (4,120,303 )     (3,244,293 )    
Investments sold
    12,604,620       2,416,380       5,632,235       4,817,975      
Increase in short-term investments, net
    (1,694,494 )     (561,395 )     (555,683 )     (846,281 )    
Net accretion/amortization of premium (discount)
    (1,010,028 )     (480,714 )     (339,298 )     (139,669 )    
Amortization of deferred debt issuance costs
    11,078       4,373       243       4,750      
Decrease (increase) in interest receivable
    (62,414 )     (3,408 )     40,104       36,768      
Decrease (increase) in receivable for investments sold
    740,951       —       222,703       (1,049,896 )    
Decrease in receivable for variation margin on open financial futures contracts
    27,094       10,750       —       7,500      
Increase (decrease) in payable for investments purchased
    2,254,979       —       (1,356,300 )     —      
Increase in payable for when-issued securities
    1,105,563       1,091,136       —       415,750      
Increase in payable for variation margin on open financial futures contracts
    66,406       20,157       30,469       14,063      
Decrease in payable for open swap contracts
    (259,576 )     (152,316 )     (104,899 )     (164,780 )    
Increase in payable to affiliate for investment adviser fee
    14,539       3,879       3,446       3,425      
Decrease in interest expense and fees payable
    (43,106 )     (8,595 )     (4,245 )     (5,640 )    
Decrease in accrued expenses
    (36,050 )     (27,320 )     (15,822 )     (14,748 )    
Net change in unrealized (appreciation) depreciation from investments
    8,852,586       4,489,696       2,650,836       1,641,311      
Net realized (gain) loss from investments
    (353,088 )     76,816       (106,532 )     375,259      
 
 
Net cash provided by operating activities
  $ 5,428,822     $ 1,482,556     $ 936,698     $ 1,242,600      
 
 
                                     
                                     
 
Cash Flows From Financing Activities
 
Distributions paid to common shareholders, net of reinvestments
  $ (4,529,830 )   $ (1,628,444 )   $ (1,121,646 )   $ (1,105,066 )    
Cash distributions paid to preferred shareholders
    (86,692 )     (49,612 )     (38,126 )     (25,567 )    
Decrease in due to custodian
    (812,300 )     —       —       (111,967 )    
 
 
Net cash used in financing activities
  $ (5,428,822 )   $ (1,678,056 )   $ (1,159,772 )   $ (1,242,600 )    
 
 
                                     
Net decrease in cash
  $ —     $ (195,500 )   $ (223,074 )   $ —      
 
 
                                     
Cash at beginning of period
  $ —     $ 195,500     $ 223,074     $ —      
 
 
                                     
Cash at end of period
  $ —     $ —     $ —     $ —      
 
 
                                     
                                     
 
Supplemental disclosure of cash flow information:
 
Noncash financing activities not included herein consist of:
                                   
Reinvestment of dividends and distributions
  $ 104,513     $ 24,778     $ 50,630     $ 14,901      
Cash paid for interest and fees
    248,194       41,665       32,145       45,309      
 
 

 
See notes to financial statements

44

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    Municipal Fund II
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
   
    (Unaudited)     2009     2008     2007     2006     2005      
 
Net asset value — Beginning of period (Common shares)
  $ 12.880     $ 11.030     $ 15.470     $ 15.860     $ 15.310     $ 15.030      
 
 
                                                     
 
Income (Loss) From Operations
 
Net investment income(1)
  $ 0.483     $ 0.943     $ 1.037     $ 1.048     $ 1.058     $ 1.094      
Net realized and unrealized gain (loss)
    (0.779 )     1.813       (4.159 )     (0.383 )     0.605       0.359      
Distributions to preferred shareholders
                                                   
From net investment income
    (0.009 )     (0.058 )     (0.168 )     (0.303 )     (0.265 )     (0.169 )    
From net realized gain
    —       —       (0.117 )     —       —       — (2)    
 
 
Total income (loss) from operations
  $ (0.305 )   $ 2.698     $ (3.407 )   $ 0.362     $ 1.398     $ 1.284      
 
 
                                                     
 
Less Distributions to Common Shareholders
 
From net investment income
  $ (0.465 )   $ (0.848 )   $ (0.747 )   $ (0.752 )   $ (0.848 )   $ (1.001 )    
From net realized gain
    —       —       (0.286 )     —       —       (0.003 )    
 
 
Total distributions to common shareholders
  $ (0.465 )   $ (0.848 )   $ (1.033 )   $ (0.752 )   $ (0.848 )   $ (1.004 )    
 
 
                                                     
Net asset value — End of period (Common shares)
  $ 12.110     $ 12.880     $ 11.030     $ 15.470     $ 15.860     $ 15.310      
 
 
                                                     
Market value — End of period (Common shares)
  $ 13.560     $ 13.370     $ 11.650     $ 14.550     $ 15.310     $ 16.170      
 
 
                                                     
Total Investment Return on Net Asset Value(3)
    (2.43 )%(4)     26.08 %     (23.08 )%     2.43 %(5)     9.56 %     8.77 %    
 
 
                                                     
Total Investment Return on Market Value(3)
    5.25 %(4)     23.88 %     (13.61 )%     (0.20 )%(5)     0.13 %     16.51 %    
 
 

 
See notes to financial statements

45

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    Municipal Fund II
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
   
    (Unaudited)     2009     2008     2007     2006     2005      
 
 
 
Ratios/Supplemental Data
 
Net assets applicable to common shares, end of period (000’s omitted)
  $ 120,616     $ 128,150     $ 109,648     $ 153,612     $ 157,463     $ 151,937      
Ratios (as a percentage of average daily net assets applicable to common
shares):(6)
Expenses excluding interest and fees
    1.22 %(7)     1.28 %     1.09 %     1.00 %(8)     1.02 %     1.03 %    
Interest and fee expense(9)
    0.36 %(7)     0.87 %     0.93 %     0.99 %     0.91 %     0.62 %    
Total expenses before custodian fee reduction
    1.58 %(7)     2.15 %     2.02 %     1.99 %(8)     1.93 %     1.65 %    
Expenses after custodian fee reduction excluding interest and fees
    1.22 %(7)     1.27 %     1.05 %     0.99 %(8)     1.01 %     1.02 %    
Net investment income
    8.03 %(7)     9.05 %     7.40 %     6.62 %     6.87 %     7.11 %    
Portfolio Turnover
    6 %(4)     22 %     54 %     31 %     26 %     10 %    
 
 
The ratios reported above are based on net assets applicable to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:
Ratios (as a percentage of average daily net assets applicable to
common shares and preferred shares):(6)
Expenses excluding interest and fees
    0.89 %(7)     0.89 %     0.69 %     0.64 %(8)     0.65 %     0.65 %    
Interest and fee expense(9)
    0.26 %(7)     0.61 %     0.60 %     0.64 %     0.58 %     0.40 %    
Total expenses before custodian fee reduction
    1.15 %(7)     1.50 %     1.29 %     1.28 %(8)     1.23 %     1.05 %    
Expenses after custodian fee reduction excluding interest and fees
    0.89 %(7)     0.89 %     0.67 %     0.63 %(8)     0.64 %     0.65 %    
Net investment income
    5.85 %(7)     6.32 %     4.73 %     4.25 %     4.37 %     4.52 %    
 
 
Senior Securities:
                                                   
Total preferred shares outstanding
    1,788       1,788       1,788       3,500       3,500       3,500      
Asset coverage per preferred share(10)
  $ 92,461     $ 96,674     $ 86,356     $ 68,894     $ 69,992     $ 68,411      
Involuntary liquidation preference per preferred share(11)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
Approximate market value per preferred share(11)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
 
 
 
(1) Computed using average common shares outstanding.
 
(2) Equal to less than $0.001 per share.
 
(3) Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.
 
(4) Not annualized.
 
(5) During the year ended September 30, 2007, the investment adviser fully reimbursed the Fund for a realized loss on the disposal of an investment security which did not meet investment guidelines. The loss had no effect on total return.
 
(6) Ratios do not reflect the effect of dividend payments to preferred shareholders.
 
(7) Annualized.
 
(8) The investment adviser was allocated a portion of the Fund’s operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.
 
(9) Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).
 
(10) Calculated by subtracting the Fund’s total liabilities (not including the preferred shares) from the Fund’s total assets, and dividing the result by the number of preferred shares outstanding.
 
(11) Plus accumulated and unpaid dividends.

 
See notes to financial statements

46

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    California Fund II
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
   
    (Unaudited)     2009     2008     2007     2006     2005      
 
Net asset value — Beginning of period (Common shares)
  $ 12.940     $ 11.310     $ 15.020     $ 15.330     $ 14.810     $ 14.510      
 
 
                                                     
 
Income (Loss) From Operations
 
Net investment income(1)
  $ 0.458     $ 0.877     $ 0.983     $ 0.981     $ 0.989     $ 1.008      
Net realized and unrealized gain (loss)
    (1.078 )     1.601       (3.583 )     (0.301 )     0.547       0.360      
Distributions to preferred shareholders
                                                   
From net investment income
    (0.013 )     (0.084 )     (0.233 )     (0.282 )     (0.243 )     (0.145 )    
From net realized gain
    —       —       (0.053 )     —       —       —      
 
 
Total income (loss) from operations
  $ (0.633 )   $ 2.394     $ (2.886 )   $ 0.398     $ 1.293     $ 1.223      
 
 
                                                     
 
Less Distributions to Common Shareholders
 
From net investment income
  $ (0.427 )   $ (0.764 )   $ (0.693 )   $ (0.708 )   $ (0.773 )   $ (0.923 )    
From net realized gain
    —       —       (0.131 )     —       —       —      
 
 
Total distributions to common shareholders
  $ (0.427 )   $ (0.764 )   $ (0.824 )   $ (0.708 )   $ (0.773 )   $ (0.923 )    
 
 
                                                     
Net asset value — End of period (Common shares)
  $ 11.880     $ 12.940     $ 11.310     $ 15.020     $ 15.330     $ 14.810      
 
 
                                                     
Market value — End of period (Common shares)
  $ 12.160     $ 12.500     $ 10.250     $ 14.250     $ 14.635     $ 14.770      
 
 
                                                     
Total Investment Return on Net Asset Value(2)
    (4.78 )%(3)     23.06 %     (19.81 )%     2.75 %     9.15 %     8.65 %    
 
 
                                                     
Total Investment Return on Market Value(2)
    0.90 %(3)     31.17 %     (23.40 )%     2.11 %     4.49 %     7.84 %    
 
 

 
See notes to financial statements

47

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    California Fund II
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
   
    (Unaudited)     2009     2008     2007     2006     2005      
 
 
 
Ratios/Supplemental Data
 
Net assets applicable to common shares, end of period (000’s omitted)
  $ 45,977     $ 50,080     $ 43,718     $ 58,010     $ 59,199     $ 57,187      
Ratios (as a percentage of average daily net assets applicable to common shares):(4)
Expenses excluding interest and fees
    1.33 %(5)     1.51 %     1.23 %     1.11 %(6)     1.13 %     1.10 %    
Interest and fee expense(7)
    0.16 %(5)     0.37 %     0.42 %     0.50 %     0.48 %     0.31 %    
Total expenses before custodian fee reduction
    1.49 %(5)     1.88 %     1.65 %     1.61 %(6)     1.61 %     1.41 %    
Expenses after custodian fee reduction excluding interest and fees
    1.33 %(5)     1.50 %     1.19 %     1.09 %(6)     1.11 %     1.06 %    
Net investment income
    7.69 %(5)     8.23 %     7.11 %     6.42 %     6.66 %     6.81 %    
Portfolio Turnover
    3 %(3)     17 %     22 %     37 %     13 %     13 %    
 
 
The ratios reported above are based on net assets applicable to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:
Ratios (as a percentage of average daily net assets applicable to common shares
and preferred shares):(4)
Expenses excluding interest and fees
    0.85 %(5)     0.93 %     0.76 %     0.71 %(6)     0.71 %     0.69 %    
Interest and fee expense(7)
    0.10 %(5)     0.23 %     0.26 %     0.32 %     0.30 %     0.20 %    
Total expenses before custodian fee reduction
    0.95 %(5)     1.16 %     1.02 %     1.03 %(6)     1.01 %     0.89 %    
Expenses after custodian fee reduction excluding interest and fees
    0.85 %(5)     0.93 %     0.74 %     0.69 %(6)     0.70 %     0.67 %    
Net investment income
    4.94 %(5)     5.07 %     4.42 %     4.09 %     4.19 %     4.28 %    
 
 
Senior Securities:
                                                   
Total preferred shares outstanding
    1,028       1,028       1,028       1,350       1,350       1,350      
Asset coverage per preferred share(8)
  $ 69,727     $ 73,719     $ 67,578     $ 67,980     $ 68,858     $ 67,364      
Involuntary liquidation preference per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
Approximate market value per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
 
 
 
(1) Computed using average common shares outstanding.
 
(2) Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.
 
(3) Not annualized.
 
(4) Ratios do not reflect the effect of dividend payments to preferred shareholders.
 
(5) Annualized.
 
(6) The investment adviser was allocated a portion of the Fund’s operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.
 
(7) Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).
 
(8) Calculated by subtracting the Fund’s total liabilities (not including the preferred shares) from the Fund’s total assets, and dividing the result by the number of preferred shares outstanding.
 
(9) Plus accumulated and unpaid dividends.

 
See notes to financial statements

48

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    Massachusetts Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
   
    (Unaudited)     2009     2008     2007     2006     2005      
 
Net asset value — Beginning of period (Common shares)
  $ 14.660     $ 12.130     $ 15.090     $ 15.640     $ 15.100     $ 14.870      
 
 
                                                     
 
Income (Loss) From Operations
 
Net investment income(1)
  $ 0.441     $ 0.901     $ 0.981     $ 0.969     $ 0.983     $ 1.031      
Net realized and unrealized gain (loss)
    (0.839 )     2.486       (2.981 )     (0.540 )     0.613       0.290      
Distributions to preferred shareholders
                                                   
From net investment income
    (0.015 )     (0.099 )     (0.289 )     (0.293 )     (0.256 )     (0.143 )    
 
 
Total income (loss) from operations
  $ (0.413 )   $ 3.288     $ (2.289 )   $ 0.136     $ 1.340     $ 1.178      
 
 
                                                     
 
Less Distributions to Common Shareholders
 
From net investment income
  $ (0.417 )   $ (0.758 )   $ (0.671 )   $ (0.686 )   $ (0.800 )   $ (0.948 )    
 
 
Total distributions to common shareholders
  $ (0.417 )   $ (0.758 )   $ (0.671 )   $ (0.686 )   $ (0.800 )   $ (0.948 )    
 
 
                                                     
Net asset value — End of period (Common shares)
  $ 13.830     $ 14.660     $ 12.130     $ 15.090     $ 15.640     $ 15.100      
 
 
                                                     
Market value — End of period (Common shares)
  $ 14.260     $ 15.250     $ 13.780     $ 14.820     $ 16.090     $ 17.350      
 
 
                                                     
Total Investment Return on Net Asset Value(2)
    (2.82 )%(3)     28.42 %     (15.70 )%     0.88 %(4)     9.14 %     7.74 %    
 
 
                                                     
Total Investment Return on Market Value(2)
    (3.66 )%(3)     17.59 %     (2.46 )%     (3.72 )%(4)     (2.28 )%     18.23 %    
 
 

 
See notes to financial statements

49

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    Massachusetts Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
   
    (Unaudited)     2009     2008     2007     2006     2005      
 
 
 
Ratios/Supplemental Data
 
Net assets applicable to common shares, end of period (000’s omitted)
  $ 24,343     $ 25,771     $ 21,311     $ 26,476     $ 27,419     $ 26,441      
Ratios (as a percentage of average daily net assets applicable to common shares):(5)
Expenses excluding interest and fees
    1.44 %(6)     1.69 %     1.41 %     1.25 %(7)     1.29 %     1.25 %    
Interest and fee expense(8)
    0.07 %(6)     0.23 %     0.71 %     0.98 %     1.54 %     1.26 %    
Total expenses before custodian fee reduction
    1.51 %(6)     1.92 %     2.12 %     2.23 %(7)     2.83 %     2.51 %    
Expenses after custodian fee reduction excluding interest and fees
    1.44 %(6)     1.68 %     1.38 %     1.25 %(7)     1.26 %     1.24 %    
Net investment income
    6.38 %(6)     7.41 %     6.83 %     6.27 %     6.50 %     6.79 %    
Portfolio Turnover
    9 %(3)     43 %     12 %     15 %     15 %     11 %    
 
 
The ratios reported above are based on net assets applicable to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:
Ratios (as a percentage of average daily net assets applicable to common shares
and preferred shares):(5)
Expenses excluding interest and fees
    0.93 %(6)     1.03 %     0.88 %     0.81 %(7)     0.81 %     0.79 %    
Interest and fee expense(8)
    0.04 %(6)     0.14 %     0.45 %     0.62 %     0.97 %     0.80 %    
Total expenses before custodian fee reduction
    0.97 %(6)     1.17 %     1.33 %     1.43 %(7)     1.78 %     1.59 %    
Expenses after custodian fee reduction excluding interest and fees
    0.93 %(6)     1.03 %     0.87 %     0.80 %(7)     0.80 %     0.78 %    
Net investment income
    4.10 %(6)     4.53 %     4.27 %     3.99 %     4.10 %     4.29 %    
 
 
Senior Securities:
                                                   
Total preferred shares outstanding
    543       543       543       620       620       620      
Asset coverage per preferred share(9)
  $ 69,832     $ 72,462     $ 64,287     $ 67,711     $ 69,229     $ 67,649      
Involuntary liquidation preference per preferred share(10)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
Approximate market value per preferred share(10)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
 
 
 
(1) Computed using average common shares outstanding.
 
(2) Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.
 
(3) Not annualized.
 
(4) During the year ended September 30, 2007, the Fund realized a gain on the disposal of an investment security which did not meet investment guidelines. The gain was less than $0.01 per share and had no effect on total return.
 
(5) Ratios do not reflect the effect of dividend payments to preferred shareholders.
 
(6) Annualized.
 
(7) The investment adviser was allocated a portion of the Fund’s operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.
 
(8) Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).
 
(9) Calculated by subtracting the Fund’s total liabilities (not including the preferred shares) from the Fund’s total assets, and dividing the result by the number of preferred shares outstanding.
 
(10) Plus accumulated and unpaid dividends.

 
See notes to financial statements

50

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    Michigan Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
   
    (Unaudited)     2009     2008     2007     2006     2005      
 
Net asset value — Beginning of period (Common shares)
  $ 14.730     $ 12.570     $ 15.150     $ 15.430     $ 15.000     $ 14.840      
 
 
                                                     
                                                     
 
Income (Loss) From Operations
 
Net investment income(1)
  $ 0.463     $ 0.925     $ 0.975     $ 0.985     $ 0.991     $ 1.039      
Net realized and unrealized gain (loss)
    (0.752 )     2.110       (2.590 )     (0.309 )     0.462       0.233      
Distributions to preferred shareholders
                                                   
From net investment income
    (0.017 )     (0.113 )     (0.295 )     (0.288 )     (0.252 )     (0.164 )    
 
 
Total income (loss) from operations
  $ (0.306 )   $ 2.922     $ (1.910 )   $ 0.388     $ 1.201     $ 1.108      
 
 
                                                     
                                                     
 
Less Distributions to Common Shareholders
 
From net investment income
  $ (0.434 )   $ (0.762 )   $ (0.670 )   $ (0.668 )   $ (0.771 )   $ (0.948 )    
 
 
Total distributions to common shareholders
  $ (0.434 )   $ (0.762 )   $ (0.670 )   $ (0.668 )   $ (0.771 )   $ (0.948 )    
 
 
                                                     
Net asset value — End of period (Common shares)
  $ 13.990     $ 14.730     $ 12.570     $ 15.150     $ 15.430     $ 15.000      
 
 
                                                     
Market value — End of period (Common shares)
  $ 14.160     $ 13.900     $ 10.400     $ 14.030     $ 14.190     $ 16.200      
 
 
                                                     
Total Investment Return on Net Asset Value(2)
    (1.94 )%(3)     25.29 %     (12.66 )%(4)     2.81 %     8.44 %     7.52 %    
 
 
                                                     
Total Investment Return on Market Value(2)
    5.20 %(3)     42.90 %     (21.97 )%(4)     3.53 %     (7.67 )%     11.26 %    
 
 

 
See notes to financial statements

51

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    Michigan Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
   
    (Unaudited)     2009     2008     2007     2006     2005      
 
 
 
Ratios/Supplemental Data
 
Net assets applicable to common shares, end of period (000’s omitted)
  $ 21,148     $ 22,276     $ 19,007     $ 22,912     $ 23,335     $ 22,670      
Ratios (as a percentage of average daily net assets applicable to common shares):(5)
Expenses excluding interest and fees
    1.49 %(6)     1.70 %     1.49 %     1.29 %(7)     1.32 %     1.28 %    
Interest and fee expense(8)
    — (6)     —       0.54 %     0.98 %     0.90 %     0.60 %    
Total expenses before custodian fee reduction
    1.49 %(6)     1.70 %     2.03 %     2.27 %(7)     2.22 %     1.88 %    
Expenses after custodian fee reduction excluding interest and fees
    1.49 %(6)     1.69 %     1.48 %     1.27 %(7)     1.30 %     1.27 %    
Net investment income
    6.58 %(6)     7.30 %     6.72 %     6.43 %     6.62 %     6.88 %    
Portfolio Turnover
    — (3)     9 %     11 %     6 %     6 %     5 %    
 
 
The ratios reported above are based on net assets applicable to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:
Ratios (as a percentage of average daily net assets applicable to common shares
and preferred shares):(5)
Expenses excluding interest and fees
    0.92 %(6)     1.00 %     0.93 %     0.81 %(7)     0.83 %     0.81 %    
Interest and fee expense(8)
    — (6)     —       0.33 %     0.62 %     0.56 %     0.38 %    
Expenses before custodian fee reduction
    0.92 %(6)     1.00 %     1.26 %     1.43 %(7)     1.39 %     1.19 %    
Expenses after custodian fee reduction excluding interest and fees
    0.92 %(6)     1.00 %     0.92 %     0.80 %(7)     0.82 %     0.80 %    
Net investment income
    4.05 %(6)     4.30 %     4.16 %     4.06 %     4.15 %     4.32 %    
 
 
Senior Securities:
                                                   
Total preferred shares outstanding
    533       533       540       540       540       540      
Asset coverage per preferred share(9)
  $ 64,678     $ 66,794     $ 60,199     $ 67,442     $ 68,222     $ 66,986      
Involuntary liquidation preference per preferred share(10)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
Approximate market value per preferred share(10)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
 
 
 
(1) Computed using average common shares outstanding.
 
(2) Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.
 
(3) Not annualized.
 
(4) During the year ended September 30, 2008, the adviser fully reimbursed the Fund for a realized loss on the disposal of an investment security which did not meet investment guidelines. The loss had no effect on total return.
 
(5) Ratios do not reflect the effect of dividend payments to preferred shareholders.
 
(6) Annualized.
 
(7) The investment adviser was allocated a portion of the Fund’s operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.
 
(8) Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).
 
(9) Calculated by subtracting the Fund’s total liabilities (not including the preferred shares) from the Fund’s total assets, and dividing the result by the number of preferred shares outstanding.
 
(10) Plus accumulated and unpaid dividends.

 
See notes to financial statements

52

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    New Jersey Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
 		   
    (Unaudited)     2009     2008     2007     2006     2005      
 
Net asset value — Beginning of period (Common shares)
  $ 14.620     $ 11.980     $ 15.690     $ 15.840     $ 15.240     $ 14.990      
 
 
                                                     
                                                     
 
Income (Loss) From Operations
 
Net investment income(1)
  $ 0.473     $ 0.926     $ 0.982     $ 0.996     $ 1.002     $ 1.039      
Net realized and unrealized gain (loss)
    (0.883 )     2.740       (3.393 )     (0.150 )     0.671       0.330      
Distributions to preferred shareholders
                                                   
From net investment income
    (0.015 )     (0.088 )     (0.196 )     (0.286 )     (0.253 )     (0.159 )    
From net realized gain
    —       (0.016 )     (0.114 )     —       —       —      
 
 
Total income (loss) from operations
  $ (0.425 )   $ 3.562     $ (2.721 )   $ 0.560     $ 1.420     $ 1.210      
 
 
                                                     
                                                     
 
Less Distributions to Common Shareholders
 
From net investment income
  $ (0.455 )   $ (0.819 )   $ (0.706 )   $ (0.710 )   $ (0.820 )   $ (0.960 )    
From net realized gain
    —       (0.103 )     (0.283 )     —       —       —      
 
 
Total distributions to common shareholders
  $ (0.455 )   $ (0.922 )   $ (0.989 )   $ (0.710 )   $ (0.820 )   $ (0.960 )    
 
 
                                                     
Net asset value — End of period (Common shares)
  $ 13.740     $ 14.620     $ 11.980     $ 15.690     $ 15.840     $ 15.240      
 
 
                                                     
Market value — End of period (Common shares)
  $ 15.360     $ 14.730     $ 11.880     $ 14.790     $ 16.400     $ 16.240      
 
 
                                                     
Total Investment Return on Net Asset Value(2)
    (2.95 )%(3)     31.84 %     (18.15 )%     3.64 %     9.65 %     8.18 %    
 
 
                                                     
Total Investment Return on Market Value(2)
    7.67 %(3)     33.95 %     (13.88 )%     (5.66 )%     6.53 %     11.56 %    
 
 

 
See notes to financial statements

53

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
 
                                                     
    New Jersey Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
 		   
    (Unaudited)     2009     2008     2007     2006     2005      
 
 
 
Ratios/Supplemental Data
 
Net assets applicable to common shares, end of period (000’s omitted)
  $ 35,428     $ 37,628     $ 30,776     $ 40,262     $ 40,620     $ 39,032      
Ratios (as a percentage of average daily net assets applicable to common shares):(4)
Expenses excluding interest and fees
    1.37 %(5)     1.53 %     1.33 %     1.14 %(6)     1.19 %     1.15 %    
Interest and fee expense(7)
    0.16 %(5)     0.46 %     1.16 %     0.92 %     0.86 %     0.59 %    
Total expenses before custodian fee reduction
    1.53 %(5)     1.99 %     2.49 %     2.06 %(6)     2.05 %     1.74 %    
Expenses after custodian fee reduction excluding interest and fees
    1.37 %(5)     1.52 %     1.28 %     1.11 %(6)     1.16 %     1.14 %    
Net investment income
    6.88 %(5)     7.81 %     6.72 %     6.29 %     6.59 %     6.78 %    
Portfolio Turnover
    7 %(3)     39 %     48 %     27 %     22 %     15 %    
 
 
The ratios reported above are based on net assets applicable to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:
Ratios (as a percentage of average daily net assets applicable to common shares
and preferred shares):(4)
Expenses excluding interest and fees
    0.88 %(5)     0.93 %     0.84 %     0.73 %(6)     0.75 %     0.73 %    
Interest and fee expense(7)
    0.10 %(5)     0.28 %     0.73 %     0.59 %     0.55 %     0.38 %    
Total expenses before custodian fee reduction
    0.98 %(5)     1.21 %     1.57 %     1.32 %(6)     1.30 %     1.11 %    
Expenses after custodian fee reduction excluding interest and fees
    0.88 %(5)     0.92 %     0.81 %     0.72 %(6)     0.73 %     0.72 %    
Net investment income
    4.43 %(5)     4.75 %     4.24 %     4.05 %     4.18 %     4.31 %    
 
 
Senior Securities:
                                                   
Total preferred shares outstanding
    784       784       812       900       900       900      
Asset coverage per preferred share(8)
  $ 70,189     $ 72,996     $ 62,907     $ 69,751     $ 70,144     $ 68,375      
Involuntary liquidation preference per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
Approximate market value per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
 
 
 
(1) Computed using average common shares outstanding.
 
(2) Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.
 
(3) Not annualized.
 
(4) Ratios do not reflect the effect of dividend payments to preferred shareholders.
 
(5) Annualized.
 
(6) The investment adviser was allocated a portion of the Fund’s operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.
 
(7) Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).
 
(8) Calculated by subtracting the Fund’s total liabilities (not including the preferred shares) from the Fund’s total assets, and dividing the result by the number of preferred shares outstanding.
 
(9) Plus accumulated and unpaid dividends.

 
See notes to financial statements

54

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
                                                     
    New York Fund II
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
 		   
    (Unaudited)     2009     2008     2007     2006     2005      
 
Net asset value — Beginning of period (Common shares)
  $ 13.620     $ 11.530     $ 15.240     $ 15.760     $ 15.300     $ 14.910      
 
 
                                                     
                                                     
 
Income (Loss) From Operations
 
Net investment income(1)
  $ 0.427     $ 0.857     $ 0.938     $ 0.969     $ 0.990     $ 1.008      
Net realized and unrealized gain (loss)
    (0.659 )     2.087       (3.483 )     (0.256 )     0.542       0.462      
Distributions to preferred shareholders
                                                   
From net investment income
    (0.010 )     (0.066 )     (0.237 )     (0.209 )     (0.240 )     (0.148 )    
From net realized gain
    —       —       (0.049 )     (0.079 )     (0.015 )     —      
 
 
Total income (loss) from operations
  $ (0.242 )   $ 2.878     $ (2.831 )   $ 0.425     $ 1.277     $ 1.322      
 
 
                                                     
                                                     
 
Less Distributions to Common Shareholders
 
From net investment income
  $ (0.438 )   $ (0.788 )   $ (0.699 )   $ (0.697 )   $ (0.732 )   $ (0.932 )    
From net realized gain
    —       —       (0.180 )     (0.248 )     (0.085 )     —      
 
 
Total distributions to common shareholders
  $ (0.438 )   $ (0.788 )   $ (0.879 )   $ (0.945 )   $ (0.817 )   $ (0.932 )    
 
 
                                                     
Net asset value — End of period (Common shares)
  $ 12.940     $ 13.620     $ 11.530     $ 15.240     $ 15.760     $ 15.300      
 
 
                                                     
Market value — End of period (Common shares)
  $ 13.890     $ 13.610     $ 10.580     $ 14.440     $ 14.420     $ 14.570      
 
 
                                                     
Total Investment Return on Net Asset Value(2)
    (1.74 )%(3)     26.71 %     (19.25 )%     3.00 %     9.02 %     9.17 %    
 
 
                                                     
Total Investment Return on Market Value(2)
    5.56 %(3)     37.98 %     (21.80 )%     6.66 %     4.75 %     7.19 %    
 
 

 
See notes to financial statements

55

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
                                                     
    New York Fund II
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
 		   
    (Unaudited)     2009     2008     2007     2006     2005      
 
 
 
Ratios/Supplemental Data
 
Net assets applicable to common shares, end of period (000’s omitted)
  $ 33,107     $ 34,847     $ 29,459     $ 38,947     $ 40,263     $ 39,101      
Ratios (as a percentage of average daily net assets applicable to common shares):(4)
Expenses excluding interest and fees
    1.39 %(5)     1.51 %     1.33 %     1.16 %(6)     1.14 %     1.21 %    
Interest and fee expense(7)
    0.27 %(5)     0.63 %     0.46 %     0.46 %     0.42 %     0.28 %    
Total expenses before custodian fee reduction
    1.66 %(5)     2.14 %     1.79 %     1.62 %(6)     1.56 %     1.49 %    
Expenses after custodian fee reduction excluding interest and fees
    1.39 %(5)     1.50 %     1.28 %     1.14 %(6)     1.11 %     1.19 %    
Net investment income
    6.61 %(5)     7.67 %     6.67 %     6.24 %     6.48 %     6.60 %    
Portfolio Turnover
    6 %(3)     30 %     44 %     38 %     26 %     29 %    
 
 
The ratios reported above are based on net assets applicable to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:
Ratios (as a percentage of average daily net assets applicable to common shares
and preferred shares):(4)
Expenses excluding interest and fees
    1.00 %(5)     1.03 %     0.83 %     0.74 %(6)     0.72 %     0.77 %    
Interest and fee expense(7)
    0.19 %(5)     0.43 %     0.29 %     0.29 %     0.27 %     0.18 %    
Total expenses before custodian fee reduction
    1.19 %(5)     1.46 %     1.12 %     1.03 %(6)     0.99 %     0.95 %    
Expenses after custodian fee reduction excluding interest and fees
    1.00 %(5)     1.02 %     0.80 %     0.73 %(6)     0.71 %     0.76 %    
Net investment income
    4.72 %(5)     5.24 %     4.17 %     3.98 %     4.11 %     4.18 %    
 
 
Senior Securities:
                                                   
Total preferred shares outstanding
    530       530       530       900       900       900      
Asset coverage per preferred share(8)
  $ 87,467     $ 90,749     $ 80,583     $ 68,285     $ 69,746     $ 68,450      
Involuntary liquidation preference per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
Approximate market value per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
 
 
 
(1) Computed using average common shares outstanding.
 
(2) Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.
 
(3) Not annualized.
 
(4) Ratios do not reflect the effect of dividend payments to preferred shareholders.
 
(5) Annualized.
 
(6) The investment adviser was allocated a portion of the Fund’s operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.
 
(7) Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).
 
(8) Calculated by subtracting the Fund’s total liabilities (not including the preferred shares) from the Fund’s total assets, and dividing the result by the number of preferred shares outstanding.
 
(9) Plus accumulated and unpaid dividends.

 
See notes to financial statements

56

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
                                                     
    Ohio Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
 		   
    (Unaudited)     2009     2008     2007     2006     2005      
 
Net asset value — Beginning of period (Common shares)
  $ 12.980     $ 11.330     $ 14.970     $ 15.330     $ 14.830     $ 14.640      
 
 
                                                     
                                                     
 
Income (Loss) From Operations
 
Net investment income(1)
  $ 0.419     $ 0.846     $ 0.948     $ 0.966     $ 0.978     $ 1.006      
Net realized and unrealized gain (loss)
    (0.630 )     1.592       (3.665 )     (0.361 )     0.497       0.219      
Distributions to preferred shareholders
                                                   
From net investment income
    (0.013 )     (0.101 )     (0.298 )     (0.301 )     (0.263 )     (0.173 )    
 
 
Total income (loss) from operations
  $ (0.224 )   $ 2.337     $ (3.015 )   $ 0.304     $ 1.212     $ 1.052      
 
 
                                                     
                                                     
 
Less Distributions to Common Shareholders
 
From net investment income
  $ (0.376 )   $ (0.687 )   $ (0.625 )   $ (0.664 )   $ (0.712 )   $ (0.862 )    
 
 
Total distributions to common shareholders
  $ (0.376 )   $ (0.687 )   $ (0.625 )   $ (0.664 )   $ (0.712 )   $ (0.862 )    
 
 
                                                     
Net asset value — End of period (Common shares)
  $ 12.380     $ 12.980     $ 11.330     $ 14.970     $ 15.330     $ 14.830      
 
 
                                                     
Market value — End of period (Common shares)
  $ 13.440     $ 13.250     $ 11.250     $ 13.710     $ 14.600     $ 14.510      
 
 
                                                     
Total Investment Return on Net Asset Value(2)
    (1.71 )%(3)     22.05 %     (20.51 )%     2.17 %     8.58 %     7.29 %    
 
 
                                                     
Total Investment Return on Market Value(2)
    4.53 %(3)     25.48 %     (13.81 )%     (1.75 )%     5.69 %     1.11 %    
 
 

 
See notes to financial statements

57

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
                                                     
    Ohio Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
 		   
    (Unaudited)     2009     2008     2007     2006     2005      
 
 
 
Ratios/Supplemental Data
 
Net assets applicable to common shares, end of period (000’s omitted)
  $ 31,227     $ 32,710     $ 28,495     $ 37,617     $ 38,532     $ 37,255      
Ratios (as a percentage of average daily net assets applicable to common shares):(4)
Expenses excluding interest and fees
    1.32 %(5)     1.57 %     1.35 %     1.16 %(6)     1.19 %     1.18 %    
Interest and fee expense(7)
    0.01 %(5)     0.10 %     0.29 %     0.53 %     0.41 %     0.25 %    
Total expenses before custodian fee reduction
    1.33 %(5)     1.67 %     1.64 %     1.69 %(6)     1.60 %     1.43 %    
Expenses after custodian fee reduction excluding interest and fees
    1.32 %(5)     1.57 %     1.33 %     1.14 %(6)     1.16 %     1.16 %    
Net investment income
    6.73 %(5)     7.87 %     6.82 %     6.33 %     6.56 %     6.76 %    
Portfolio Turnover
    4 %(3)     18 %     22 %     30 %     16 %     8 %    
 
 
The ratios reported above are based on net assets applicable to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:
Ratios (as a percentage of average daily net assets applicable to common shares
and preferred shares):(4)
Expenses excluding interest and fees
    0.85 %(5)     0.95 %     0.83 %     0.74 %(6)     0.75 %     0.74 %    
Interest and fee expense(7)
    0.01 %(5)     0.06 %     0.18 %     0.34 %     0.26 %     0.16 %    
Total expenses before custodian fee reduction
    0.86 %(5)     1.01 %     1.01 %     1.08 %(6)     1.01 %     0.90 %    
Expenses after custodian fee reduction excluding interest and fees
    0.85 %(5)     0.95 %     0.82 %     0.72 %(6)     0.73 %     0.73 %    
Net investment income
    4.37 %(5)     4.77 %     4.19 %     4.03 %     4.14 %     4.26 %    
 
 
Senior Securities:
                                                   
Total preferred shares outstanding
    680       680       875       875       875       875      
Asset coverage per preferred share(8)
  $ 70,924     $ 73,104     $ 57,579     $ 67,991     $ 69,036     $ 67,586      
Involuntary liquidation preference per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
Approximate market value per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
 
 
 
(1) Computed using average common shares outstanding.
 
(2) Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.
 
(3) Not annualized.
 
(4) Ratios do not reflect the effect of dividend payments to preferred shareholders.
 
(5) Annualized.
 
(6) The investment adviser was allocated a portion of the Fund’s operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.
 
(7) Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).
 
(8) Calculated by subtracting the Fund’s total liabilities (not including the preferred shares) from the Fund’s total assets, and dividing the result by the number of preferred shares outstanding.
 
(9) Plus accumulated and unpaid dividends.

 
See notes to financial statements

58

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
                                                     
    Pennsylvania Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
 		   
    (Unaudited)     2009     2008     2007     2006     2005      
 
Net asset value — Beginning of period (Common shares)
  $ 13.900     $ 12.030     $ 15.270     $ 15.470     $ 14.930     $ 14.410      
 
 
                                                     
                                                     
 
Income (Loss) From Operations
 
Net investment income(1)
  $ 0.436     $ 0.889     $ 0.995     $ 0.995     $ 0.994     $ 1.019      
Net realized and unrealized gain (loss)
    (1.015 )     2.123       (3.047 )     (0.209 )     0.559       0.587      
Distributions to preferred shareholders
                                                   
From net investment income
    (0.014 )     (0.071 )     (0.236 )     (0.291 )     (0.266 )     (0.173 )    
From net realized gain
    —       (0.045 )     (0.076 )     —       —       —      
 
 
Total income (loss) from operations
  $ (0.593 )   $ 2.896     $ (2.364 )   $ 0.495     $ 1.287     $ 1.433      
 
 
                                                     
                                                     
 
Less Distributions to Common Shareholders
 
From net investment income
  $ (0.417 )   $ (0.753 )   $ (0.693 )   $ (0.695 )   $ (0.747 )   $ (0.913 )    
From net realized gain
    —       (0.273 )     (0.183 )     —       —       —      
 
 
Total distributions to common shareholders
  $ (0.417 )   $ (1.026 )   $ (0.876 )   $ (0.695 )   $ (0.747 )   $ (0.913 )    
 
 
                                                     
Net asset value — End of period (Common shares)
  $ 12.890     $ 13.900     $ 12.030     $ 15.270     $ 15.470     $ 14.930      
 
 
                                                     
Market value — End of period (Common shares)
  $ 13.750     $ 14.600     $ 13.400     $ 14.150     $ 15.020     $ 15.540      
 
 
                                                     
Total Investment Return on Net Asset Value(2)
    (4.28 )%(3)     27.36 %     (16.07 )%     3.44 %     9.00 %     10.01 %    
 
 
                                                     
Total Investment Return on Market Value(2)
    (2.79 )%(3)     20.09 %     0.88 %     (1.28 )%     1.68 %     10.15 %    
 
 

 
See notes to financial statements

59

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
FINANCIAL STATEMENTS CONT’D
 
 
 
Financial Highlights
 
Selected data for a common share outstanding during the periods stated
                                                     
    Pennsylvania Fund
    Six Months Ended
 		    Year Ended September 30,
    March 31, 2010
 		   
    (Unaudited)     2009     2008     2007     2006     2005      
 
 
 
Ratios/Supplemental Data
 
Net assets applicable to common shares, end of period (000’s omitted)
  $ 38,011     $ 40,956     $ 35,413     $ 44,955     $ 45,516     $ 43,920      
Ratios (as a percentage of average daily net assets applicable to common shares):(4)
Expenses excluding interest and fees
    1.34 %(5)     1.52 %     1.30 %     1.15 %(6)     1.18 %     1.16 %    
Interest and fee expense(7)
    0.07 %(5)     0.17 %     1.03 %     0.83 %     0.78 %     0.41 %    
Total expenses before custodian fee reduction
    1.41 %(5)     1.69 %     2.33 %     1.98 %(6)     1.96 %     1.57 %    
Expenses after custodian fee reduction excluding interest and fees
    1.34 %(5)     1.51 %     1.28 %     1.12 %(6)     1.15 %     1.15 %    
Net investment income
    6.67 %(5)     7.80 %     6.86 %     6.45 %     6.64 %     6.91 %    
Portfolio Turnover
    7 %(3)     8 %     28 %     24 %     22 %     19 %    
 
 
The ratios reported above are based on net assets applicable to common shares. The ratios based on net assets, including amounts related to preferred shares, are as follows:
Ratios (as a percentage of average daily net assets applicable to common shares
and preferred shares):(4)
Expenses excluding interest and fees
    0.86 %(5)     0.91 %     0.81 %     0.73 %(6)     0.74 %     0.73 %    
Interest and fee expense(7)
    0.04 %(5)     0.10 %     0.64 %     0.53 %     0.49 %     0.26 %    
Total expenses before custodian fee reduction
    0.90 %(5)     1.01 %     1.45 %     1.26 %(6)     1.23 %     0.99 %    
Expenses after custodian fee reduction excluding interest and fees
    0.86 %(5)     0.90 %     0.80 %     0.71 %(6)     0.72 %     0.72 %    
Net investment income
    4.27 %(5)     4.68 %     4.26 %     4.10 %     4.17 %     4.32 %    
 
 
Senior Securities:
                                                   
Total preferred shares outstanding
    869       869       1,040       1,040       1,040       1,040      
Asset coverage per preferred share(8)
  $ 68,743     $ 72,133     $ 59,091     $ 68,233     $ 68,770     $ 67,232      
Involuntary liquidation preference per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
Approximate market value per preferred share(9)
  $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000     $ 25,000      
 
 
 
(1) Computed using average common shares outstanding.
 
(2) Returns are historical and are calculated by determining the percentage change in net asset value or market value with all distributions reinvested.
 
(3) Not annualized.
 
(4) Ratios do not reflect the effect of dividend payments to preferred shareholders.
 
(5) Annualized.
 
(6) The investment adviser was allocated a portion of the Fund’s operating expenses (equal to less than 0.01% of average daily net assets for the year ended September 30, 2007). Absent this allocation, total return would be lower.
 
(7) Interest and fee expense relates to the liability for floating rate notes issued in conjunction with inverse floater securities transactions (see Note 1H).
 
(8) Calculated by subtracting the Fund’s total liabilities (not including the preferred shares) from the Fund’s total assets, and dividing the result by the number of preferred shares outstanding.
 
(9) Plus accumulated and unpaid dividends.

 
See notes to financial statements

60

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited)
 
1   Significant Accounting Policies
 
Eaton Vance Municipal Bond Fund II (formerly, Eaton Vance Insured Municipal Bond Fund II) (Municipal Fund II), Eaton Vance California Municipal Bond Fund II (formerly, Eaton Vance Insured California Municipal Bond Fund II) (California Fund II), Eaton Vance Massachusetts Municipal Bond Fund (formerly, Eaton Vance Insured Massachusetts Municipal Bond Fund) (Massachusetts Fund), Eaton Vance Michigan Municipal Bond Fund (formerly, Eaton Vance Insured Michigan Municipal Bond Fund) (Michigan Fund), Eaton Vance New Jersey Municipal Bond Fund (formerly, Eaton Vance Insured New Jersey Municipal Bond Fund) (New Jersey Fund), Eaton Vance New York Municipal Bond Fund II (formerly, Eaton Vance Insured New York Municipal Bond Fund II) (New York Fund II), Eaton Vance Ohio Municipal Bond Fund (formerly, Eaton Vance Insured Ohio Municipal Bond) (Ohio Fund) and Eaton Vance Pennsylvania Municipal Bond Fund (formerly, Eaton Vance Insured Pennsylvania Municipal Bond Fund) (Pennsylvania Fund), (each individually referred to as the Fund, and collectively, the Funds), are Massachusetts business trusts registered under the Investment Company Act of 1940, as amended (the 1940 Act), as non-diversified, closed-end management investment companies. Each Fund seeks to provide current income exempt from regular federal income tax, including alternative minimum tax, and, in state specific funds, taxes in its specified state.
 
The following is a summary of significant accounting policies of the Funds. The policies are in conformity with accounting principles generally accepted in the United States of America.
 
A  Investment Valuation — Debt obligations (including short-term obligations with a remaining maturity of more than sixty days) are generally valued on the basis of valuations furnished by third party pricing services, as derived from such services’ pricing models. Inputs to the models may include, but are not limited to, reported trades, executable bid and asked prices, broker/dealer quotations, prices or yields of securities with similar characteristics, benchmark curves or information pertaining to the issuer, as well as industry and economic events. The pricing services may use a matrix approach, which considers information regarding securities with similar characteristics to determine the valuation for a security. Short-term obligations, maturing in sixty days or less, are generally valued at amortized cost, which approximates market value. Financial futures contracts are valued at the closing settlement price established by the board of trade or exchange on which they are traded. Interest rate swaps are normally valued using valuations provided by a third party pricing service. Such pricing service valuations are based on the present value of fixed and projected floating rate cash flows over the term of the swap contract. Future cash flows are discounted to their present value using swap curves provided by electronic data services or by broker/dealers. Investments for which valuations or market quotations are not readily available or are deemed unreliable are valued at fair value using methods determined in good faith by or at the direction of the Trustees of a Fund in a manner that most fairly reflects the security’s value, or the amount that the Fund might reasonably expect to receive for the security upon its current sale in the ordinary course. Each such determination is based on a consideration of all relevant factors, which are likely to vary from one pricing context to another. These factors may include, but are not limited to, the type of security, the existence of any contractual restrictions on the security’s disposition, the price and extent of public trading in similar securities of the issuer or of comparable entities, quotations or relevant information obtained from broker-dealers or other market participants, information obtained from the issuer, analysts, and/or the appropriate stock exchange (for exchange-traded securities), an analysis of the entity’s financial condition, and an evaluation of the forces that influence the issuer and the market(s) in which the security is purchased and sold.
 
B  Investment Transactions and Related Income — Investment transactions for financial statement purposes are accounted for on a trade date basis. Realized gains and losses on investments sold are determined on the basis of identified cost. Interest income is recorded on the basis of interest accrued, adjusted for amortization of premium or accretion of discount.
 
C  Federal Taxes — Each Fund’s policy is to comply with the provisions of the Internal Revenue Code applicable to regulated investment companies and to distribute to shareholders each year substantially all of its taxable, if any, and tax-exempt net investment income, and all or substantially all of its net realized capital gains. Accordingly, no provision for federal income or excise tax is necessary. Each Fund intends to satisfy conditions which will enable it to designate distributions from the interest income generated by its investments in municipal obligations, which are exempt from regular federal income tax when received by each Fund, as exempt-interest dividends.
 
At September 30, 2009, the following Funds, for federal income tax purposes, had capital loss carryforwards which will reduce the respective Fund’s taxable income arising from future net realized gains on investment transactions, if any, to the extent permitted by the Internal Revenue Code, and thus will reduce the amount of distributions to shareholders, which would otherwise be necessary to relieve the Funds of any liability for federal income or excise tax. The amounts and expiration dates of the capital loss carryforwards are as follows:
 

61

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
                     
Fund   Amount     Expiration Date      
 
Municipal II
  $ 658,427       September 30, 2016      
      2,011,041       September 30, 2017      
                     
California II
  $ 52,500       September 30, 2016      
      1,365,711       September 30, 2017      
                     
Massachusetts
  $ 179,329       September 30, 2013      
      94,578       September 30, 2017      
                     
Michigan
  $ 384,407       September 30, 2013      
      1,883       September 30, 2016      
                     
New Jersey
  $ 244,927       September 30, 2017      
                     
New York II
  $ 41,818       September 30, 2016      
      1,233,356       September 30, 2017      
                     
Ohio
  $ 321,978       September 30, 2013      
      83,319       September 30, 2016      
      1,620,085       September 30, 2017      
 
Additionally, at September 30, 2009, the Municipal Fund II, California Fund II, Massachusetts Fund, Michigan Fund, New Jersey Fund, New York Fund II, Ohio Fund and Pennsylvania Fund had net capital losses of $11,660,513, $3,404,426, $1,057,708, $579,640, $2,262,820, $1,660,342, $3,402,294 and $1,901,230, respectively, attributable to security transactions incurred after October 31, 2008. These net capital losses are treated as arising on the first day of the Funds’ taxable year ending September 30, 2010.
 
As of March 31, 2010, the Funds had no uncertain tax positions that would require financial statement recognition, de-recognition, or disclosure. Each of the Funds’ federal tax returns filed in the 3-year period ended September 30, 2009 remains subject to examination by the Internal Revenue Service.
 
D  Expense Reduction — State Street Bank and Trust Company (SSBT) serves as custodian of the Funds. Pursuant to the respective custodian agreements, SSBT receives a fee reduced by credits, which are determined based on the average daily cash balance each Fund maintains with SSBT. All credit balances, if any, used to reduce each Fund’s custodian fees are reported as a reduction of expenses in the Statements of Operations.
 
E  Legal Fees — Legal fees and other related expenses incurred as part of negotiations of the terms and requirement of capital infusions, or that are expected to result in the restructuring of, or a plan of reorganization for, an investment are recorded as realized losses. Ongoing expenditures to protect or enhance an investment are treated as operating expenses.
 
F  Use of Estimates — The preparation of the financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of income and expense during the reporting period. Actual results could differ from those estimates.
 
G  Indemnifications — Under each Fund’s organizational documents, its officers and Trustees may be indemnified against certain liabilities and expenses arising out of the performance of their duties to each Fund. Under Massachusetts law, if certain conditions prevail, shareholders of a Massachusetts business trust, (such as a Fund) could be deemed to have personal liability for the obligations of the Fund. However, each Fund’s Declaration of Trust contains an express disclaimer of liability on the part of Fund shareholders and the By-laws provide that the Fund shall assume the defense on behalf of any Fund shareholders. Moreover, the By-laws also provide for indemnification out of Fund property of any shareholder held personally liable solely by reason of being or having been a shareholder for all loss or expense arising from such liability. Additionally, in the normal course of business, each Fund enters into agreements with service providers that may contain indemnification clauses. Each Fund’s maximum exposure under these arrangements is unknown as this would involve future claims that may be made against each Fund that have not yet occurred.
 
H  Floating Rate Notes Issued in Conjunction with Securities Held — The Funds may invest in inverse floating rate securities, also referred to as residual interest bonds, whereby a Fund may sell a fixed rate bond to a broker for cash. At the same time, the Fund buys a residual interest in the assets and cash flows of a Special-Purpose Vehicle (the SPV), (which is generally organized as a trust), set up by the broker, often referred to as an inverse floating rate obligation (Inverse Floater). The broker deposits a fixed rate bond into the SPV with the same CUSIP number as the fixed rate bond sold to the broker by the Fund, and which may have been, but is not required to be, the fixed rate bond purchased from the Fund (the Fixed Rate Bond). The SPV also issues floating rate notes (Floating Rate Notes) which are sold to third-parties.
 
The Inverse Floater held by a Fund gives the Fund the right (1) to cause the holders of the Floating Rate Notes to tender their notes at par, and (2) to have the broker transfer the Fixed Rate Bond held by the SPV to the Fund, thereby terminating the SPV. Should the Fund exercise such right, it would pay the broker the par amount due on the Floating Rate Notes and exchange the Inverse Floater for the underlying Fixed Rate Bond. Pursuant to generally accepted accounting principles for transfers and servicing of financial assets and extinguishment of liabilities, the Funds account for the transaction described above as a secured borrowing by including the Fixed Rate Bond in

62

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
their Portfolio of Investments and the Floating Rate Notes as a liability under the caption “Payable for floating rate notes issued” in their Statement of Assets and Liabilities. The Floating Rate Notes have interest rates that generally reset weekly and their holders have the option to tender their notes to the broker for redemption at par at each reset date. Interest expense related to the Funds’ liability with respect to Floating Rate Notes is recorded as incurred. The SPV may be terminated by the Fund, as noted above, or by the broker upon the occurrence of certain termination events as defined in the trust agreement, such as a downgrade in the credit quality of the underlying bond, bankruptcy of or payment failure by the issuer of the underlying bond, the inability to remarket Floating Rate Notes that have been tendered due to insufficient buyers in the market, or the failure by the SPV to obtain renewal of the liquidity agreement under which liquidity support is provided for the Floating Rate Notes up to one year. Structuring fees paid to the liquidity provider upon the creation of an SPV have been recorded as debt issuance costs and are being amortized as interest expense to the expected maturity of the related trust. At March 31, 2010, the amounts of the Funds’ Floating Rate Notes and related interest rates and collateral were as follows:
 
                         
              Collateral
 		     
    Floating
 		    Interest Rate
 		  for Floating
 		     
    Rate
 		    or Range of
 		  Rate
 		     
    Notes
 		    Interest
 		  Notes
 		     
Fund   Outstanding     Rates (%)   Outstanding      
 
Municipal II
  $ 57,365,000     0.29 – 0.33   $ 67,123,806      
California II
    9,575,000     0.29 – 0.31     10,962,619      
Massachusetts
    2,460,000     0.30 – 0.31     2,956,755      
Michigan
    —     —     —      
New Jersey
    6,346,000     0.29 – 0.33     8,401,393      
New York II
    11,335,000     0.29 – 0.31     12,974,541      
Ohio
    1,010,000     0.33 – 0.47     1,697,170      
Pennsylvania
    2,850,000     0.30 – 0.49     4,799,530      
 
For the six months ended March 31, 2010, the Funds’ average Floating Rate Notes outstanding and the average interest rate (annualized) including fees and amortization of deferred debt issuance costs were as follows:
 
                     
    Average
 		           
    Floating
 		           
    Rate
 		           
    Notes
 		    Average
 		     
Fund   Outstanding     Interest Rate      
 
Municipal II
  $ 57,365,000       0.76 %    
California II
    9,575,000       0.78      
Massachusetts
    2,460,000       0.67      
Michigan
    —       —      
New Jersey
    6,346,000       0.89      
New York II
    11,335,000       0.79      
Ohio
    1,010,000       0.39      
Pennsylvania
    2,088,462       1.21      
 
The Funds may enter into shortfall and forbearance agreements with the broker by which a Fund agrees to reimburse the broker, in certain circumstances, for the difference between the liquidation value of the Fixed Rate Bond held by the SPV and the liquidation value of the Floating Rate Notes, as well as any shortfalls in interest cash flows. The Funds had no shortfalls as of March 31, 2010.
 
The Funds may also purchase Inverse Floaters from brokers in a secondary market transaction without first owning the underlying fixed rate bond. Such transactions are not required to be treated as secured borrowings. Shortfall agreements, if any, related to Inverse Floaters purchased in a secondary market transaction are disclosed in the Portfolio of Investments. The Funds’ investment policies and restrictions expressly permit investments in Inverse Floaters. Inverse floating rate securities typically offer the potential for yields exceeding the yields available on fixed rate bonds with comparable credit quality and maturity. These securities tend to underperform the market for fixed rate bonds in a rising long-term interest rate environment, but tend to outperform the market for fixed rate bonds when long-term interest rates decline. The value and income of inverse floating rate securities are generally more volatile than that of a fixed rate bond. The Funds’ investment policies do not allow the Funds to borrow money except as permitted by the 1940 Act. Management believes that the Funds’ restrictions on borrowing money and issuing senior securities (other than as specifically permitted) do not apply to Floating Rate Notes issued by the SPV and included as a liability in the Funds’ Statement of Assets and Liabilities. As secured indebtedness issued by an SPV, Floating Rate Notes are distinct from the borrowings and senior securities to which the Funds’ restrictions apply. Inverse Floaters held by the Funds are securities exempt from registration under Rule 144A of the Securities Act of 1933.
 
I  Financial Futures Contracts — The Funds may enter into financial futures contracts. The Funds’ investment in financial futures contracts is designed for hedging against

63

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
changes in interest rates or as a substitute for the purchase of securities. Upon entering into a financial futures contract, a Fund is required to deposit with the broker, either in cash or securities, an amount equal to a certain percentage of the purchase price (initial margin). Subsequent payments, known as variation margin, are made or received by the Fund each business day, depending on the daily fluctuations in the value of the underlying security, and are recorded as unrealized gains or losses by the Fund. Gains (losses) are realized upon the expiration or closing of the financial futures contracts. Should market conditions change unexpectedly, the Fund may not achieve the anticipated benefits of the financial futures contracts and may realize a loss. Futures contracts have minimal counterparty risk as they are exchange traded and the clearinghouse for the exchange is substituted as the counterparty, guaranteeing counterparty performance.
 
J  Interest Rate Swaps — The Funds may enter into interest rate swap agreements to enhance return, to hedge against fluctuations in securities prices or interest rates, or as substitution for the purchase or sale of securities. Pursuant to these agreements, a Fund makes periodic payments at a fixed interest rate and, in exchange, receives payments based on the interest rate of a benchmark industry index. During the term of the outstanding swap agreement, changes in the underlying value of the swap are recorded as unrealized gains or losses. The value of the swap is determined by changes in the relationship between two rates of interest. A Fund is exposed to credit loss in the event of non-performance by the swap counterparty. Risk may also arise from movements in interest rates.
 
K  When-Issued Securities and Delayed Delivery Transactions — The Funds may purchase or sell securities on a delayed delivery or when-issued basis. Payment and delivery may take place after the customary settlement period for that security. At the time the transaction is negotiated, the price of the security that will be delivered is fixed. The Funds maintain security positions for these commitments such that sufficient liquid assets will be available to make payments upon settlement. Securities purchased on a delayed delivery or when-issued basis are marked-to-market daily and begin earning interest on settlement date. Losses may arise due to changes in the market value of the underlying securities or if the counterparty does not perform under the contract.
 
L  Statement of Cash Flows — The cash amount shown in the Statement of Cash Flows of a Fund is the amount included in the Fund’s Statement of Assets and Liabilities and represents the cash on hand at its custodian and does not include any short-term investments.
 
M  Interim Financial Statements — The interim financial statements relating to March 31, 2010 and for the six months then ended have not been audited by an independent registered public accounting firm, but in the opinion of the Funds’ management, reflect all adjustments, consisting only of normal recurring adjustments, necessary for the fair presentation of the financial statements.
 
2   Auction Preferred Shares
 
Each Fund issued Auction Preferred Shares (APS) on January 15, 2003 in a public offering. The underwriting discounts and other offering costs incurred in connection with the offering were recorded as a reduction of the paid-in capital of the common shares of each respective Fund. Dividends on the APS, which accrue daily, are cumulative at rates which are reset every seven days by an auction, unless a special dividend period has been set. If the APS auctions do not successfully clear, the dividend payment rate over the next period for the APS holders is set at a specified maximum applicable rate until such time as the APS auctions are successful. The maximum applicable rate on the APS is 110% (150% for taxable distributions) of the greater of the 1) “AA” Financial Composite Commercial Paper Rate or 2) Taxable Equivalent of the Short-Term Municipal Obligation Rate on the date of the auction. Series of APS are identical in all respects except for the reset dates of the dividend rates.
 
The number of APS issued and outstanding as of March 31, 2010 are as follows:
 
             
Fund   APS Issued and Outstanding      
 
Municipal II
           
Series A
    894      
Series B
    894      
California II
    1,028      
Massachusetts
    543      
Michigan
    533      
New Jersey
    784      
New York II
    530      
Ohio
    680      
Pennsylvania
    869      
 
The APS are redeemable at the option of each Fund at a redemption price equal to $25,000 per share, plus accumulated and unpaid dividends, on any dividend payment date. The APS are also subject to mandatory redemption at a redemption price equal to $25,000 per share, plus accumulated and unpaid dividends, if a Fund is in default for an extended period on its asset maintenance requirements with respect to the APS. If the dividends on the APS remain unpaid in an amount equal to two full years’ dividends, the holders of the APS as a class have the right to elect a majority of the Board of Trustees. In general, the holders of the APS and the common shares have equal voting rights of one vote per share, except that

64

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
the holders of the APS, as a separate class, have the right to elect at least two members of the Board of Trustees. The APS have a liquidation preference of $25,000 per share, plus accumulated and unpaid dividends. Each Fund is required to maintain certain asset coverage with respect to the APS as defined in the Funds’ By-laws and the 1940 Act. Each Fund pays an annual fee up to 0.15% of the liquidation value of the APS to broker-dealers as a service fee if the auctions are unsuccessful; otherwise, the annual fee is 0.25%.
 
3   Distributions to Shareholders
 
Each Fund intends to make monthly distributions of net investment income to common shareholders, after payment of any dividends on any outstanding APS. In addition, at least annually, each Fund intends to distribute all or substantially all of its net realized capital gains, (reduced by available capital loss carryforwards from prior years, if any). Distributions to common shareholders are recorded on the ex-dividend date. Distributions to preferred shareholders are recorded daily and are payable at the end of each dividend period. The dividend rates for APS at March 31, 2010, and the amount of dividends paid (including capital gains, if any) to APS shareholders, average APS dividend rates, and dividend rate ranges for the six months then ended were as follows:
 
                                 
    APS
 		    Dividends
 		    Average APS
 		    Dividend
 		   
    Dividend Rates at
 		    Paid to APS
 		    Dividend
 		    Rate
 		   
Fund   March 31, 2010     Shareholders     Rates     Ranges (%)    
 
Municipal II
                               
Series A
    0.46 %   $ 42,689       0.38 %   0.24 – 0.56    
Series B
    0.46       43,910       0.39     0.24 – 0.56    
California II
    0.46       49,087       0.38     0.24 – 0.56    
Massachusetts
    0.46       25,832       0.38     0.24 – 0.56    
Michigan
    0.44       25,297       0.38     0.26 – 0.50    
New Jersey
    0.44       38,046       0.39     0.26 – 0.62    
New York II
    0.44       25,546       0.39     0.26 – 0.58    
Ohio
    0.46       32,910       0.39     0.24 – 0.56    
Pennsylvania
    0.46       40,986       0.38     0.24 – 0.50    
 
Beginning February 13, 2008 and consistent with the patterns in the broader market for auction-rate securities, the Funds’ APS auctions were unsuccessful in clearing due to an imbalance of sell orders over bids to buy the APS. As a result, the dividend rates of the APS were reset to the maximum applicable rates. The table above reflects such maximum dividend rates for each series as of March 31, 2010.
 
The Funds distinguish between distributions on a tax basis and a financial reporting basis. Accounting principles generally accepted in the United States of America require that only distributions in excess of tax basis earnings and profits be reported in the financial statements as a return of capital. Permanent differences between book and tax accounting relating to distributions are reclassified to paid-in capital. For tax purposes, distributions from short-term capital gains are considered to be from ordinary income.
 
4   Investment Adviser Fee and Other Transactions with Affiliates
 
The investment adviser fee is earned by Eaton Vance Management (EVM) as compensation for investment advisory services rendered to each Fund. The fee is computed at an annual rate of 0.55% of each Fund’s average weekly gross assets and is payable monthly. Average weekly gross assets include the principal amount of any indebtedness for money borrowed, including debt securities issued by a Fund, and the amount of any outstanding APS issued by the Fund. Pursuant to a fee reduction agreement with EVM, average weekly gross assets are calculated by adding to net assets the liquidation value of a Fund’s APS then outstanding and the amount payable by the Fund to floating rate note holders, such adjustment being limited to the value of the APS outstanding prior to any APS redemptions by the Fund. EVM also serves as the administrator of each Fund, but receives no compensation.
 
In addition, EVM has contractually agreed to reimburse the Funds for fees and other expenses at an annual rate of 0.15% of average weekly gross assets of each Fund during the first five full years of its operations, 0.10% of a Fund’s average weekly gross assets in year six, and 0.05% in year seven. The Funds concluded their first seven full years of operations on November 29, 2009. For the six months ended March 31, 2010, the investment adviser fee and expenses contractually reduced by EVM were as follows:
 
                     
    Investment
 		    Expenses
 		     
Fund   Adviser Fee     Reduced by EVM      
 
Municipal II
  $ 569,593     $ 16,776      
California II
    219,383       6,532      
Massachusetts
    109,460       3,233      
Michigan
    95,142       2,810      
New Jersey
    159,301       4,638      
New York II
    152,730       4,503      
Ohio
    135,842       4,002      
Pennsylvania
    171,393       5,053      
 
Except for Trustees of the Funds who are not members of EVM’s organization, officers and Trustees receive remuneration for their services to the Funds out of the investment adviser fee. Trustees of the Funds who are not affiliated with the investment adviser may elect to defer receipt of all or a percentage of their annual fees in accordance with the terms of the Trustees Deferred

65

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
Compensation Plan. For the six months ended March 31, 2010, no significant amounts have been deferred. Certain officers and Trustees of the Funds are officers of EVM.
 
5   Purchases and Sales of Investments
 
Purchases and sales of investments, other than short-term obligations, for the six months ended March 31, 2010 were as follows:
 
                     
Fund   Purchases     Sales      
 
Municipal II
  $ 13,873,404     $ 12,604,620      
California II
    2,971,375       2,416,380      
Massachusetts
    5,208,028       3,564,552      
Michigan
    —       924,948      
New Jersey
    4,120,303       5,632,235      
New York II
    3,244,293       4,817,975      
Ohio
    1,762,271       1,839,196      
Pennsylvania
    4,531,063       4,310,947      
 
6   Common Shares of Beneficial Interest
 
Common shares issued pursuant to the Funds’ dividend reinvestment plan for the six months ended March 31, 2010 and the year ended September 30, 2009 were as follows:
 
                     
    Six Months Ended
 		           
    March 31, 2010
 		    Year Ended
 		     
Fund   (Unaudited)     September 30, 2009      
 
Municipal II
    8,364       15,775      
California II
    2,096       5,322      
Massachusetts
    2,250       1,835      
Michigan
    —       132      
New Jersey
    3,589       5,648      
New York II
    1,144       2,353      
Ohio
    2,583       5,911      
Pennsylvania
    1,779       2,397      
 
7   Federal Income Tax Basis of Investments
 
The cost and unrealized appreciation (depreciation) of investments of each Fund at March 31, 2010, as determined on a federal income tax basis, were as follows:
 
             
Municipal Fund II
           
 
 
Aggregate cost
  $ 174,926,958      
 
 
Gross unrealized appreciation
  $ 5,349,516      
Gross unrealized depreciation
    (14,155,121 )    
 
 
Net unrealized depreciation
  $ (8,805,605 )    
 
 
             
             
California Fund II
           
 
 
Aggregate cost
  $ 76,689,988      
 
 
Gross unrealized appreciation
  $ 1,982,273      
Gross unrealized depreciation
    (6,564,142 )    
 
 
Net unrealized depreciation
  $ (4,581,869 )    
 
 
             
             
Massachusetts Fund
           
 
 
Aggregate cost
  $ 38,589,511      
 
 
Gross unrealized appreciation
  $ 1,617,253      
Gross unrealized depreciation
    (824,837 )    
 
 
Net unrealized appreciation
  $ 792,416      
 
 
             
             
Michigan Fund
           
 
 
Aggregate cost
  $ 33,482,150      
 
 
Gross unrealized appreciation
  $ 1,557,039      
Gross unrealized depreciation
    (968,308 )    
 
 
Net unrealized appreciation
  $ 588,731      
 
 
             
             
New Jersey Fund
           
 
 
Aggregate cost
  $ 53,738,101      
 
 
Gross unrealized appreciation
  $ 2,542,850      
Gross unrealized depreciation
    (1,739,350 )    
 
 
Net unrealized appreciation
  $ 803,500      
 
 
             
             
New York Fund II
           
 
 
Aggregate cost
  $ 45,413,164      
 
 
Gross unrealized appreciation
  $ 1,851,199      
Gross unrealized depreciation
    (2,199,543 )    
 
 
Net unrealized depreciation
  $ (348,344 )    
 
 
             
             
Ohio Fund
           
 
 
Aggregate cost
  $ 48,061,282      
 
 
Gross unrealized appreciation
  $ 1,087,572      
Gross unrealized depreciation
    (1,509,559 )    
 
 
Net unrealized depreciation
  $ (421,987 )    
 
 
             
             

66

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
             
Pennsylvania Fund
           
 
 
Aggregate cost
  $ 61,017,067      
 
 
Gross unrealized appreciation
  $ 832,458      
Gross unrealized depreciation
    (2,786,356 )    
 
 
Net unrealized depreciation
  $ (1,953,898 )    
 
 
 
8   Financial Instruments
 
The Funds may trade in financial instruments with off-balance sheet risk in the normal course of their investing activities. These financial instruments may include financial futures contracts and interest rate swaps and may involve, to a varying degree, elements of risk in excess of the amounts recognized for financial statement purposes. The notional or contractual amounts of these instruments represent the investment a Fund has in particular classes of financial instruments and do not necessarily represent the amounts potentially subject to risk. The measurement of the risks associated with these instruments is meaningful only when all related and offsetting transactions are considered.
 
A summary of obligations under these financial instruments at March 31, 2010 is as follows:
 
                                         
Futures Contracts
 
                            Net
 		     
                            Unrealized
 		     
    Expiration
 		          Aggregate
 		          Appreciation
 		     
Fund   Date   Contracts   Position   Cost     Value     (Depreciation)      
 
Municipal II   6/10   61
U.S. 10-Year Treasury Note 		  Short   $ (7,062,442 )   $ (7,091,250 )   $ (28,808 )    
    6/10   101
U.S. 30-Year Treasury Bond 		  Short     (11,749,209 )     (11,728,625 )     20,584      
 
 
California II   6/10   43
U.S. 30-Year Treasury Bond 		  Short   $ (5,017,412 )   $ (4,993,376 )   $ 24,036      
 
 
Michigan   6/10   4
U.S. 10-Year Treasury Note 		  Short   $ (463,111 )   $ (465,000 )   $ (1,889 )    
    6/10   6
U.S. 30-Year Treasury Bond 		  Short     (700,104 )     (696,750 )     3,354      
 
 
New Jersey   6/10   65
U.S. 30-Year Treasury Bond 		  Short   $ (7,671,804 )   $ (7,548,125 )   $ 123,679      
 
 
New York II   6/10   30
U.S. 30-Year Treasury Bond 		  Short   $ (3,500,520 )   $ (3,483,750 )   $ 16,770      
 
 
Ohio   6/10   21
U.S. 10-Year Treasury Note 		  Short   $ (2,431,333 )   $ (2,441,250 )   $ (9,917 )    
    6/10   29
U.S. 30-Year Treasury Bond 		  Short     (3,373,586 )     (3,367,625 )     5,961      
 
 
 
                                 
Interest Rate Swaps
Municipal Fund II
 
          Annual
 		  Floating
 		  Effective Date/
 		         
    Notional
 		    Fixed Rate
 		  Rate
 		  Termination
 		  Net Unrealized
 		     
Counterparty   Amount     Paid By Fund   Paid To Fund   Date   Depreciation      
 
JPMorgan
Chase Co.  		  $ 3,000,000     4.609%   3-month
USD-LIBOR-BBA 		  June 15, 2010/
June 15, 2040 		  $ (21,718 )    
 
 
Merrill Lynch
Capital
Services, Inc.  		    3,000,000     4.665   3-month
USD-LIBOR-BBA 		  May 24, 2010/
May 24, 2040 		    (57,514 )    
 
 
                        $ (79,232 )    
 
 
                                 
                                 
California Fund II
 
          Annual
 		  Floating
 		  Effective Date/
 		         
    Notional
 		    Fixed Rate
 		  Rate
 		  Termination
 		  Net Unrealized
 		     
Counterparty   Amount     Paid By Fund   Paid To Fund   Date   Depreciation      
 
JPMorgan
Chase Co.  		  $ 1,137,500     4.609%   3-month
USD-LIBOR-BBA 		  June 15, 2010/
June 15, 2040 		  $ (8,235 )    
 
 
Merrill Lynch
Capital
Services, Inc.  		    1,812,500     4.665   3-month
USD-LIBOR-BBA 		  May 24, 2010/
May 24, 2040 		    (34,748 )    
 
 
                        $ (42,983 )    
 
 
                                 
                                 
Massachusetts Fund
 
          Annual
 		  Floating
 		  Effective Date/
 		         
    Notional
 		    Fixed Rate
 		  Rate
 		  Termination
 		  Net Unrealized
 		     
Counterparty   Amount     Paid By Fund   Paid To Fund   Date   Depreciation      
 
JPMorgan
Chase Co.  		  $ 525,000     4.609%   3-month
USD-LIBOR-BBA 		  June 15, 2010/
June 15, 2040 		  $ (3,801 )    
 
 
Merrill Lynch
Capital
Services, Inc.  		    862,500     4.665   3-month
USD-LIBOR-BBA 		  May 24, 2010/
May 24, 2040 		    (16,535 )    
 
 
                        $ (20,336 )    
 
 
                                 
                                 
Michigan Fund
 
          Annual
 		  Floating
 		  Effective Date/
 		         
    Notional
 		    Fixed Rate
 		  Rate
 		  Termination
 		  Net Unrealized
 		     
Counterparty   Amount     Paid By Fund   Paid To Fund   Date   Depreciation      
 
JPMorgan
Chase Co.  		  $ 450,000     4.609%   3-month
USD-LIBOR-BBA 		  June 15, 2010/
June 15, 2040 		  $ (3,258 )    
 
 
Merrill Lynch
Capital
Services, Inc.  		    675,000     4.665   3-month
USD-LIBOR-BBA 		  May 24, 2010/
May 24, 2040 		    (12,940 )    
 
 
                        $ (16,198 )    
 
 
                                 
                                 

67

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
                                 
New Jersey Fund
 
          Annual
 		  Floating
 		  Effective Date/
 		         
    Notional
 		    Fixed Rate
 		  Rate
 		  Termination
 		  Net Unrealized
 		     
Counterparty   Amount     Paid By Fund   Paid To Fund   Date   Depreciation      
 
JPMorgan
Chase Co.  		  $ 762,500     4.609%   3-month
USD-LIBOR-BBA 		  June 15, 2010/
June 15, 2040 		  $ (5,520 )    
 
 
Merrill Lynch
Capital
Services, Inc.  		    1,250,000     4.665   3-month
USD-LIBOR-BBA 		  May 24, 2010/
May 24, 2040 		    (23,964 )    
 
 
                        $ (29,484 )    
 
 
                                 
                                 
New York Fund II
 
          Annual
 		  Floating
 		  Effective Date/
 		         
    Notional
 		    Fixed Rate
 		  Rate
 		  Termination
 		  Net Unrealized
 		     
Counterparty   Amount     Paid By Fund   Paid To Fund   Date   Depreciation      
 
                                 
JPMorgan
Chase Co.  		  $ 762,500     4.609%   3-month
USD-LIBOR-BBA 		  June 15, 2010/
June 15, 2040 		  $ (5,520 )    
 
 
Merrill Lynch
Capital
Services, Inc.  		    2,000,000     4.665   3-month
USD-LIBOR-BBA 		  May 24, 2010/
May 24, 2040 		    (38,343 )    
 
 
                        $ (43,863 )    
 
 
                                 
                                 
Ohio Fund
 
          Annual
 		  Floating
 		  Effective Date/
 		         
    Notional
 		    Fixed Rate
 		  Rate
 		  Termination
 		  Net Unrealized
 		     
Counterparty   Amount     Paid By Fund   Paid To Fund   Date   Depreciation      
 
JPMorgan
Chase Co.  		  $ 737,500     4.609%   3-month
USD-LIBOR-BBA 		  June 15, 2010/
June 15, 2040 		  $ (5,339 )    
 
 
Merrill Lynch
Capital
Services, Inc.  		    750,000     4.665   3-month
USD-LIBOR-BBA 		  May 24, 2010/
May 24, 2040 		    (14,378 )    
 
 
                        $ (19,717 )    
 
 
                                 
                                 
Pennsylvania Fund
 
          Annual
 		  Floating
 		  Effective Date/
 		         
    Notional
 		    Fixed Rate
 		  Rate
 		  Termination
 		  Net Unrealized
 		     
Counterparty   Amount     Paid By Fund   Paid To Fund   Date   Depreciation      
 
Barclays
Bank PLC 		  $ 3,000,000     4.532%   3-month
USD-LIBOR-BBA 		  April 21, 2010/
July 27, 2039 		  $ (4,433 )    
 
 
JPMorgan
Chase Co.  		    725,000     4.609   3-month
USD-LIBOR-BBA 		  June 15, 2010/
June 15, 2040 		    (5,249 )    
 
 
                        $ (9,682 )    
 
 
 
The effective date represents the date on which a Fund and the counterparty to the interest rate swap contract begin interest payment accruals.
 
At March 31, 2010, the Funds had sufficient cash and/or securities to cover commitments under these contracts.
 
Each Fund is subject to interest rate risk in the normal course of pursuing its investment objectives. Because the Funds hold fixed rate bonds, the value of these bonds may decrease if interest rates rise. To hedge against this risk, each Fund may enter into interest rate swap contracts. The Funds may also purchase and sell U.S. Treasury futures contracts to hedge against changes in interest rates.
 
The Funds enter into interest rate swap contracts that may contain provisions whereby the counterparty may terminate the contract under certain conditions, including but not limited to a decline in a Fund’s net assets below a certain level over a certain period of time, which would trigger a payment by the Fund for those swaps in a liability position. At March 31, 2010, the fair value of interest rate swaps with credit-related contingent features in a net liability position was equal to the fair value of the liability derivative related to interest rate swaps included in the table below for each respective Fund. The value of securities pledged as collateral, if any, for open interest rate swap contracts at March 31, 2010 is disclosed in a note to each Fund’s Portfolio of Investments.
 
The non-exchange traded derivatives in which a Fund invests, including swap contracts, are subject to the risk that the counterparty to the contract fails to perform its obligations under the contract. At March 31, 2010, the maximum amount of loss the Funds would incur due to counterparty risk was equal to the fair value of the asset derivative related to interest rate swaps included in the table below for each respective Fund. Counterparties may be required to pledge collateral in the form of cash, U.S. Government securities or highly-rated bonds for the benefit of a Fund if the net amount due from the counterparty with respect to a derivative contract exceeds a certain threshold. The amount of collateral posted by the counterparties with respect to such contracts would also reduce the amount of any loss incurred.
 
The fair value of derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) and whose primary underlying risk exposure is interest rate risk at March 31, 2010 was as follows:
 
                     
    Fair Value
     
    Asset Derivative     Liability Derivative      
 
Municipal Fund II
                   
Futures Contracts
  $ 20,584 (1)   $ (28,808 )(2)    
Interest Rate Swaps
    —       (79,232 )(3)    
 
 
Total
  $ 20,584     $ (108,040 )    
 
 
California Fund II
                   
Futures Contracts
  $ 24,036 (1)   $ —      
Interest Rate Swaps
    —       (42,983 )(3)    
 
 
Total
  $ 24,036     $ (42,983 )    
 
 

68

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
                     
    Fair Value
     
    Asset Derivative     Liability Derivative      
 
Massachusetts Fund
                   
Futures Contracts
  $ —     $ —      
Interest Rate Swaps
    —       (20,336 )(3)    
 
 
Total
  $ —     $ (20,336 )    
 
 
Michigan Fund
                   
Futures Contracts
  $ 3,354 (1)   $ (1,889 )(2)    
Interest Rate Swaps
    —       (16,198 )(3)    
 
 
Total
  $ 3,354     $ (18,087 )    
 
 
New Jersey Fund
                   
Futures Contracts
  $ 123,679 (1)   $ —      
Interest Rate Swaps
    —       (29,484 )(3)    
 
 
Total
  $ 123,679     $ (29,484 )    
 
 
New York Fund II
                   
Futures Contracts
  $ 16,770 (1)   $ —      
Interest Rate Swaps
    —       (43,863 )(3)    
 
 
Total
  $ 16,770     $ (43,863 )    
 
 
Ohio Fund
                   
Futures Contracts
  $ 5,961 (1)   $ (9,917 )(2)    
Interest Rate Swaps
    —       (19,717 )(3)    
 
 
Total
  $ 5,961     $ (29,634 )    
 
 
Pennsylvania Fund
                   
Futures Contracts
  $ —     $ —      
Interest Rate Swaps
    —       (9,682 )(3)    
 
 
Total
  $ —     $ (9,682 )    
 
 
 
(1) Amount represents cumulative unrealized appreciation on futures contracts in the Futures Contracts table above. Only the current day’s variation margin on open futures contracts is reported within the Statement of Assets and Liabilities as Receivable or Payable for variation margin, as applicable.
 
(2) Amount represents cumulative unrealized depreciation on futures contracts in the Futures Contracts table above. Only the current day’s variation margin on open futures contracts is reported within the Statement of Assets and Liabilities as Receivable or Payable for variation margin, as applicable.
 
(3) Statement of Assets and Liabilities location: Payable for open swap contracts; Net unrealized appreciation (depreciation).
 
The effect of derivative instruments (not considered to be hedging instruments for accounting disclosure purposes) on the Statement of Operations and whose primary underlying risk exposure is interest rate risk for the six months ended March 31, 2010 was as follows:
 
                     
          Change in
 		     
          Unrealized
 		     
    Realized Gain
 		    Appreciation
 		     
    (Loss) on
 		    (Depreciation) on
 		     
    Derivatives
 		    Derivatives
 		     
    Recognized
 		    Recognized in
 		     
Fund   in Income(1)      Income(2)       
 
Municipal II
  $ 182,860     $ 591,480      
California II
    108,385       261,495      
Massachusetts
    38,676       72,372      
Michigan
    26,837       81,439      
New Jersey
    56,172       228,578      
New York II
    74,583       240,249      
Ohio
    35,548       166,337      
Pennsylvania
    127,382       164,483      
 
(1) Statement of Operations location: Net realized gain (loss) – Financial futures contracts and swap contracts.
 
(2) Statement of Operations location: Change in unrealized appreciation (depreciation) – Financial futures contracts and swap contracts.
 
The average notional amounts of futures contracts and interest rate swaps outstanding during the six months ended March 31, 2010, which are indicative of the volume of these derivative types, were approximately as follows:
 
                     
    Average Notional Amount
     
    Futures
 		    Interest Rate
 		     
Fund   Contracts     Swaps      
 
Municipal II
  $ 17,029,000     $ 6,000,000      
California II
    4,300,000       2,950,000      
Massachusetts
    —       1,387,500      
Michigan
    1,057,000       1,125,000      
New Jersey
    929,000       2,012,500      
New York II
    3,000,000       2,762,500      
Ohio
    5,329,000       1,487,500      
Pennsylvania
    —       3,725,000      
 
9   Fair Value Measurements
 
Under generally accepted accounting principles for fair value measurements, a three-tier hierarchy to prioritize the assumptions, referred to as inputs, is used in valuation techniques to measure fair value. The three-tier hierarchy of inputs is summarized in the three broad levels listed below.
 
  •  Level 1 – quoted prices in active markets for identical investments
 
  •  Level 2 – other significant observable inputs (including quoted prices for similar investments, interest rates, prepayment speeds, credit risk, etc.)

69

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
 
  •  Level 3 – significant unobservable inputs (including a fund’s own assumptions in determining the fair value of investments)
 
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
 
At March 31, 2010, the inputs used in valuing the Funds’ investments, which are carried at value, were as follows:
 
                                 
Municipal Fund II  
    Quoted
 		                   
    Prices in
 		                   
    Active
 		    Significant
 		             
    Markets for
 		    Other
 		    Significant
 		       
    Identical
 		    Observable
 		    Unobservable
 		       
    Assets     Inputs     Inputs        
       
Asset Description   (Level 1)     (Level 2)     (Level 3)     Total  
   
Tax-Exempt Investments
  $ —     $ 221,791,859     $      —     $ 221,791,859  
Short-Term Investments
    —       1,694,494       —       1,694,494  
 
 
Total Investments
  $ —     $ 223,486,353     $ —     $ 223,486,353  
 
 
Futures Contracts
  $ 20,584     $ —     $ —     $ 20,584  
 
 
Total
  $ 20,584     $ 223,486,353     $ —     $ 223,506,937  
 
 
                                 
Liability Description
                               
 
 
Futures Contracts
  $ (28,808 )   $ —     $ —     $ (28,808 )
Interest Rate Swaps
    —       (79,232 )     —       (79,232 )
 
 
Total
  $ (28,808 )   $ (79,232 )   $ —     $ (108,040 )
 
 
 
                                 
California Fund II  
    Quoted
 		                   
    Prices in
 		                   
    Active
 		    Significant
 		             
    Markets for
 		    Other
 		    Significant
 		       
    Identical
 		    Observable
 		    Unobservable
 		       
    Assets     Inputs     Inputs        
       
Asset Description   (Level 1)     (Level 2)     (Level 3)     Total  
   
Tax-Exempt Investments
  $ —     $ 81,121,724     $      —     $ 81,121,724  
Short-Term Investments
    —       561,395       —       561,395  
 
 
Total Investments
  $ —     $ 81,683,119     $ —     $ 81,683,119  
 
 
Futures Contracts
  $ 24,036     $ —     $ —     $ 24,036  
 
 
Total
  $ 24,036     $ 81,683,119     $ —     $ 81,707,155  
 
 
                                 
Liability Description
                               
 
 
Interest Rate Swaps
  $ —     $ (42,983 )   $ —     $ (42,983 )
 
 
Total
  $ —     $ (42,983 )   $ —     $ (42,983 )
 
 
 
                                 
Massachusetts Fund  
    Quoted
 		                   
    Prices in
 		                   
    Active
 		    Significant
 		             
    Markets for
 		    Other
 		    Significant
 		       
    Identical
 		    Observable
 		    Unobservable
 		       
    Assets     Inputs     Inputs        
       
Asset Description   (Level 1)     (Level 2)     (Level 3)     Total  
   
Tax-Exempt Investments
  $      —     $ 41,049,390     $      —     $ 41,049,390  
Short-Term Investments
    —       792,537       —       792,537  
 
 
Total Investments
  $ —     $ 41,841,927     $ —     $ 41,841,927  
 
 
                                 
Liability Description
                               
 
 
Interest Rate Swaps
  $ —     $ (20,336 )   $ —     $ (20,336 )
 
 
Total
  $ —     $ (20,336 )   $ —     $ (20,336 )
 
 
 
                                 
Michigan Fund  
    Quoted
 		                   
    Prices in
 		                   
    Active
 		    Significant
 		             
    Markets for
 		    Other
 		    Significant
 		       
    Identical
 		    Observable
 		    Unobservable
 		       
    Assets     Inputs     Inputs        
       
Asset Description   (Level 1)     (Level 2)     (Level 3)     Total  
   
Tax-Exempt Investments
  $ —     $ 33,371,974     $      —     $ 33,371,974  
Short-Term Investments
    —       698,907       —       698,907  
 
 
Total Investments
  $ —     $ 34,070,881     $ —     $ 34,070,881  
 
 
Futures Contracts
  $ 3,354     $ —     $ –     $ 3,354  
 
 
Total
  $ 3,354     $ 34,070,881     $ —     $ 34,074,235  
 
 
                                 
Liability Description
                               
 
 
Futures Contracts
  $ (1,889 )   $ —     $ —     $ (1,889 )
Interest Rate Swaps
    —       (16,198 )     —       (16,198 )
 
 
Total
  $ (1,889 )   $ (16,198 )   $ —     $ (18,087 )
 
 
 

70

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
                                 
New Jersey Fund  
    Quoted
 		                   
    Prices in
 		                   
    Active
 		    Significant
 		             
    Markets for
 		    Other
 		    Significant
 		       
    Identical
 		    Observable
 		    Unobservable
 		       
    Assets     Inputs     Inputs        
       
Asset Description   (Level 1)     (Level 2)     (Level 3)     Total  
   
Tax-Exempt Investments
  $ —     $ 60,331,918     $      —     $ 60,331,918  
Short-Term Investments
    —       555,683       —       555,683  
 
 
Total Investments
  $ —     $ 60,887,601     $ —     $ 60,887,601  
 
 
Futures Contracts
  $ 123,679     $ —     $ —     $ 123,679  
 
 
Total
  $ 123,679     $ 60,887,601     $ —     $ 61,011,280  
 
 
                                 
Liability Description
                               
 
 
Interest Rate Swaps
  $ —     $ (29,484 )   $ —     $ (29,484 )
 
 
Total
  $ —     $ (29,484 )   $ —     $ (29,484 )
 
 
 
                                 
New York Fund II  
    Quoted
 		                   
    Prices in
 		                   
    Active
 		    Significant
 		             
    Markets for
 		    Other
 		    Significant
 		       
    Identical
 		    Observable
 		    Unobservable
 		       
    Assets     Inputs     Inputs        
       
Asset Description   (Level 1)     (Level 2)     (Level 3)     Total  
   
Tax-Exempt Investments
  $ —     $ 55,553,539     $      —     $ 55,553,539  
Short-Term Investments
    —       846,281       —       846,281  
 
 
Total Investments
  $ —     $ 56,399,820     $ —     $ 56,399,820  
 
 
Futures Contracts
  $ 16,770     $ —     $ —     $ 16,770  
 
 
Total
  $ 16,770     $ 56,399,820     $ —     $ 56,416,590  
 
 
                                 
Liability Description
                               
 
 
Interest Rate Swaps
  $ —     $ (43,863 )   $ —     $ (43,863 )
 
 
Total
  $ —     $ (43,863 )   $ —     $ (43,863 )
 
 
 
                                 
Ohio Fund  
    Quoted
 		                   
    Prices in
 		                   
    Active
 		    Significant
 		             
    Markets for
 		    Other
 		    Significant
 		       
    Identical
 		    Observable
 		    Unobservable
 		       
    Assets     Inputs     Inputs        
       
Asset Description   (Level 1)     (Level 2)     (Level 3)     Total  
   
Tax-Exempt Investments
  $ —     $ 47,645,586     $      —     $ 47,645,586  
Short-Term Investments
    —       1,003,709       —       1,003,709  
 
 
Total Investments
  $ —     $ 48,649,295     $ —     $ 48,649,295  
 
 
Futures Contracts
  $ 5,961     $ —     $ —     $ 5,961  
 
 
Total
  $ 5,961     $ 48,649,295     $ —     $ 48,655,256  
 
 
                                 
Liability Description
                               
 
 
Futures Contracts
  $ (9,917 )   $ —     $ —     $ (9,917 )
Interest Rate Swaps
    —       (19,717 )     —       (19,717 )
 
 
Total
  $ (9,917 )   $ (19,717 )   $ —     $ (29,634 )
 
 
 
                                 
Pennsylvania Fund  
    Quoted
 		                   
    Prices in
 		                   
    Active
 		    Significant
 		             
    Markets for
 		    Other
 		    Significant
 		       
    Identical
 		    Observable
 		    Unobservable
 		       
    Assets     Inputs     Inputs        
       
Asset Description   (Level 1)     (Level 2)     (Level 3)     Total  
   
Tax-Exempt Investments
  $      —     $ 61,230,978     $      —     $ 61,230,978  
Short-Term Investments
    —       682,191       —       682,191  
 
 
Total Investments
  $ —     $ 61,913,169     $ —     $ 61,913,169  
 
 
                                 
Liability Description
                               
 
 
Interest Rate Swaps
  $ —     $ (9,682 )   $ —     $ (9,682 )
 
 
Total
  $ —     $ (9,682 )   $ —     $ (9,682 )
 
 
 
The Funds held no investments or other financial instruments as of September 30, 2009 whose fair value was determined using Level 3 inputs.
 
10   Name Change
 
Effective February 1, 2010, the names of Eaton Vance Municipal Bond Fund II, Eaton Vance California Municipal Bond Fund II, Eaton Vance Massachusetts Municipal Bond Fund, Eaton Vance Michigan Municipal Bond Fund, Eaton Vance New Jersey Municipal Bond Fund, Eaton Vance New York Municipal Bond Fund II, Eaton Vance Ohio Municipal Bond Fund and Eaton Vance Pennsylvania Municipal Bond Fund were changed from Eaton Vance Insured Municipal Bond Fund II, Eaton Vance Insured

71

 

 
Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTES TO FINANCIAL STATEMENTS (Unaudited) CONT’D
 
California Municipal Bond Fund II, Eaton Vance Insured Massachusetts Municipal Bond Fund, Eaton Vance Insured Michigan Municipal Bond Fund, Eaton Vance Insured New Jersey Municipal Bond Fund, Eaton Vance Insured New York Municipal Bond Fund II, Eaton Vance Insured Ohio Municipal Bond Fund and Eaton Vance Insured Pennsylvania Municipal Bond Fund, respectively. The name changes resulted from a modification to each Fund’s 80 percent policy to eliminate the requirement to invest primarily in insured municipal obligations, which was approved by the Funds’ shareholders.

72

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
 
NOTICE TO SHAREHOLDERS (Unaudited)
 
 
At a joint Special Meeting of Shareholders held on January 29, 2010, shareholders of the Funds approved a modification to each Fund’s 80 percent policy to eliminate the requirement to invest primarily in insured municipal obligations. Effective February 1, 2010, the Funds are required, under normal market conditions, to invest at least 80 percent of net assets in municipal obligations rated A or better by Moody’s, S&P or Fitch and each Fund eliminated “Insured” from its name. For purposes of the Funds’ 80 percent requirement, the rating of insured obligations will be deemed to be the higher of the claims-paying rating of the insurer and the rating of the underlying issue.

73

 

Eaton Vance Municipal Bond Funds as of March 31, 2010
 
SPECIAL MEETING OF SHAREHOLDERS (Unaudited)
 
The Funds held a joint Special Meeting of Shareholders on January 29, 2010. The following action was taken by the shareholders of each Fund:
 
Item 1: To approve a modification to each Fund’s investment policy to eliminate the requirement that the Fund invest at least 80 percent of its net assets in municipal obligations that are insured as to the payment of principal and interest.
 
                             
    Number of Shares      
    For     Against     Abstain      
 
 
Municipal Bond Fund II:
    4,539,103       686,564       197,725      
California Municipal Bond Fund II:
    1,794,683       326,964       64,030      
Massachusetts Municipal Bond Fund:
    814,949       195,598       24,107      
Michigan Municipal Bond Fund:
    638,976       157,791       25,675      
New Jersey Municipal Bond Fund:
    1,120,887       175,042       50,653      
New York Municipal Bond Fund II:
    1,026,793       202,655       52,457      
Ohio Municipal Bond Fund:
    1,089,835       205,273       70,505      
Pennsylvania Municipal Bond Fund:
    1,348,242       212,063       48,444      
 
Results are rounded to the nearest whole number.

74

 

Eaton Vance Municipal Bond Funds 
 
BOARD OF TRUSTEES’ ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS
 
Overview of the Contract Review Process
 
The Investment Company Act of 1940, as amended (the “1940 Act”), provides, in substance, that each investment advisory agreement between a fund and its investment adviser will continue in effect from year to year only if its continuance is approved at least annually by the fund’s board of trustees, including by a vote of a majority of the trustees who are not “interested persons” of the fund (“Independent Trustees”), cast in person at a meeting called for the purpose of considering such approval.
 
At a meeting of the Boards of Trustees (each a “Board”) of the Eaton Vance group of mutual funds (the “Eaton Vance Funds”) held on April 27, 2009, the Board, including a majority of the Independent Trustees, voted to approve continuation of existing advisory and sub-advisory agreements for the Eaton Vance Funds for an additional one-year period. In voting its approval, the Board relied upon the affirmative recommendation of the Contract Review Committee of the Board (formerly the Special Committee), which is a committee comprised exclusively of Independent Trustees. Prior to making its recommendation, the Contract Review Committee reviewed information furnished for a series of meetings of the Contract Review Committee held in February, March and April 2009. Such information included, among other things, the following:
 
Information about Fees, Performance and Expenses
 
  •  An independent report comparing the advisory and related fees paid by each fund with fees paid by comparable funds;
  •  An independent report comparing each fund’s total expense ratio and its components to comparable funds;
  •  An independent report comparing the investment performance of each fund to the investment performance of comparable funds over various time periods;
  •  Data regarding investment performance in comparison to relevant peer groups of funds and appropriate indices;
  •  Comparative information concerning fees charged by each adviser for managing other mutual funds and institutional accounts using investment strategies and techniques similar to those used in managing the fund;
  •  Profitability analyses for each adviser with respect to each fund;
 
Information about Portfolio Management
 
  •  Descriptions of the investment management services provided to each fund, including the investment strategies and processes employed, and any changes in portfolio management processes and personnel;
  •  Information concerning the allocation of brokerage and the benefits received by each adviser as a result of brokerage allocation, including information concerning the acquisition of research through “soft dollar” benefits received in connection with the funds’ brokerage, and the implementation of a soft dollar reimbursement program established with respect to the funds;
  •  Data relating to portfolio turnover rates of each fund;
  •  The procedures and processes used to determine the fair value of fund assets and actions taken to monitor and test the effectiveness of such procedures and processes;
 
Information about each Adviser
 
  •  Reports detailing the financial results and condition of each adviser;
  •  Descriptions of the qualifications, education and experience of the individual investment professionals whose responsibilities include portfolio management and investment research for the funds, and information relating to their compensation and responsibilities with respect to managing other mutual funds and investment accounts;
  •  Copies of the Codes of Ethics of each adviser and its affiliates, together with information relating to compliance with and the administration of such codes;
  •  Copies of or descriptions of each adviser’s proxy voting policies and procedures;
  •  Information concerning the resources devoted to compliance efforts undertaken by each adviser and its affiliates on behalf of the funds (including descriptions of various compliance programs) and their record of compliance with investment policies and restrictions, including policies with respect to market-timing, late trading and selective portfolio disclosure, and with policies on personal securities transactions;
  •  Descriptions of the business continuity and disaster recovery plans of each adviser and its affiliates;
 
Other Relevant Information
 
  •  Information concerning the nature, cost and character of the administrative and other non-investment management services provided by Eaton Vance Management and its affiliates;
  •  Information concerning management of the relationship with the custodian, subcustodians and fund accountants by each adviser or the funds’ administrator; and

75

 

 
Eaton Vance Municipal Bond Funds 
 
BOARD OF TRUSTEES’ ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS CONT’D
 
  •  The terms of each advisory agreement.
 
In addition to the information identified above, the Contract Review Committee considered information provided from time to time by each adviser throughout the year at meetings of the Board and its committees. Over the course of the twelve-month period ended April 30, 2009, the Board met eighteen times and the Contract Review Committee, the Audit Committee, the Governance Committee, the Portfolio Management Committee and the Compliance Reports and Regulatory Matters Committee, each of which is a Committee comprised solely of Independent Trustees, met seven, five, six, six and six times, respectively. At such meetings, the Trustees received, among other things, presentations by the portfolio managers and other investment professionals of each adviser relating to the investment performance of each fund and the investment strategies used in pursuing the fund’s investment objective.
 
For funds that invest through one or more underlying portfolios, the Board considered similar information about the portfolio(s) when considering the approval of advisory agreements. In addition, in cases where the fund’s investment adviser has engaged a sub-adviser, the Board considered similar information about the sub-adviser when considering the approval of any sub-advisory agreement.
 
The Contract Review Committee was assisted throughout the contract review process by Goodwin Procter LLP, legal counsel for the Independent Trustees. The members of the Contract Review Committee relied upon the advice of such counsel and their own business judgment in determining the material factors to be considered in evaluating each advisory and sub-advisory agreement and the weight to be given to each such factor. The conclusions reached with respect to each advisory and sub-advisory agreement were based on a comprehensive evaluation of all the information provided and not any single factor. Moreover, each member of the Contract Review Committee may have placed varying emphasis on particular factors in reaching conclusions with respect to each advisory and sub-advisory agreement.
 
Results of the Process
 
Based on its consideration of the foregoing, and such other information as it deemed relevant, including the factors and conclusions described below, the Contract Review Committee concluded that the continuance of the investment advisory agreements of the following funds:
 
  •  Eaton Vance Insured Municipal Bond Fund II
  •  Eaton Vance Insured California Municipal Bond Fund II
  •  Eaton Vance Insured Massachusetts Municipal Bond Fund
  •  Eaton Vance Insured Michigan Municipal Bond Fund
  •  Eaton Vance Insured New Jersey Municipal Bond Fund
  •  Eaton Vance Insured New York Municipal Bond Fund II
  •  Eaton Vance Insured Ohio Municipal Bond Fund
  •  Eaton Vance Insured Pennsylvania Municipal Bond Fund
 
(the “Funds”), each with Eaton Vance Management (the “Adviser”), including their fee structures, is in the interests of shareholders and, therefore, the Contract Review Committee recommended to the Board approval of each agreement. The Board accepted the recommendation of the Contract Review Committee as well as the factors considered and conclusions reached by the Contract Review Committee with respect to each agreement. Accordingly, the Board, including a majority of the Independent Trustees, voted to approve continuation of the investment advisory agreement for each Fund.
 
Nature, Extent and Quality of Services
 
In considering whether to approve the investment advisory agreements of the Funds, the Board evaluated the nature, extent and quality of services provided to the Funds by the Adviser.
 
The Board considered the Adviser’s management capabilities and investment process with respect to the types of investments held by each Fund, including the education, experience and number of its investment professionals and other personnel who provide portfolio management, investment research, and similar services to the Funds, and recent changes in the identity of such personnel with respect to certain Funds. In particular, the Board evaluated, where relevant, the abilities and experience of such investment personnel in analyzing factors such as credit risk, tax efficiency, and special considerations relevant to investing in municipal bonds. The Board considered the Adviser’s large municipal bond team, which includes portfolio managers and credit specialists who provide services to

76

 

 
Eaton Vance Municipal Bond Funds 
 
BOARD OF TRUSTEES’ ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS CONT’D
 
the Funds. The Board also took into account the resources dedicated to portfolio management and other services, including the compensation paid to recruit and retain investment personnel, and the time and attention devoted to each Fund by senior management.
 
The Board also reviewed the compliance programs of the Adviser and relevant affiliates thereof. Among other matters, the Board considered compliance and reporting matters relating to personal trading by investment personnel, selective disclosure of portfolio holdings, late trading, frequent trading, portfolio valuation, business continuity and the allocation of investment opportunities. The Board also evaluated the responses of the Adviser and its affiliates to requests from regulatory authorities such as the Securities and Exchange Commission and the Financial Industry Regulatory Authority.
 
The Board considered shareholder and other administrative services provided or managed by Eaton Vance Management and its affiliates, including transfer agency and accounting services. The Board evaluated the benefits to shareholders of investing in a fund that is a part of a large family of funds.
 
The Board considered the Adviser’s recommendations for Board action and other steps taken in response to the unprecedented dislocations experienced in the capital markets over recent periods, including sustained periods of high volatility, credit disruption and government intervention. In particular, the Board considered the Adviser’s efforts and expertise with respect to each of the following matters as they relate to the Funds and/or other funds within the Eaton Vance family of funds: (i) negotiating and maintaining the availability of bank loan facilities and other sources of credit used for investment purposes or to satisfy liquidity needs; (ii) establishing the fair value of securities and other instruments held in investment portfolios during periods of market volatility and issuer-specific disruptions; and (iii) the ongoing monitoring of investment management processes and risk controls. In addition, the Board considered the Adviser’s actions with respect to the Auction Preferred Shares (“APS”) issued by the Funds, including the Adviser’s efforts to seek alternative forms of debt and other leverage that may over time reduce financing costs associated with APS and enable the Funds to restore liquidity for APS holders.
 
After consideration of the foregoing factors, among others, the Board concluded that the nature, extent and quality of services provided by the Adviser, taken as a whole, are appropriate and consistent with the terms of the respective investment advisory agreements.
 
Fund Performance
 
The Board compared each Fund’s investment performance to a relevant universe of similarly managed funds identified by an independent data provider and appropriate benchmark indices. The Board reviewed comparative performance data for the one-, three-, and five-year periods ended September 30, 2008 for each Fund in operation over such periods. The Board considered the impact of extraordinary market conditions during 2008 on each Fund’s performance relative to its peer universe in light of, among other things, the Adviser’s strategy of generating current income through investments in higher quality (including insured) municipal bonds with longer maturities. On the basis of the foregoing and other relevant information, the Board concluded that, under the circumstances, the performance of each Fund was satisfactory.
 
Management Fees and Expenses
 
The Board reviewed contractual investment advisory fee rates, including any administrative fee rates, payable by each Fund (referred to collectively as “management fees”). As part of its review, the Board considered each Fund’s management fee and total expense ratio for the year ended September 30, 2008, as compared to a group of similarly managed funds selected by an independent data provider.
 
After reviewing the foregoing information, and in light of the nature, extent and quality of the services provided by the Adviser, the Board concluded with respect to each Fund that the management fees charged to the Fund for advisory and related services and the total expense ratio of the Fund are reasonable.
 
Profitability
 
The Board reviewed the level of profits realized by the Adviser and relevant affiliates thereof in providing investment advisory and administrative services to each Fund and to all Eaton Vance Funds as a group. The Board considered the level of profits realized with and without regard to revenue sharing or other payments by the Adviser and its affiliates to third parties in respect of distribution services. The Board also considered other direct or indirect benefits received by the Adviser in connection with its relationship with the Funds.

77

 

 
Eaton Vance Municipal Bond Funds 
 
BOARD OF TRUSTEES’ ANNUAL APPROVAL OF THE INVESTMENT ADVISORY AGREEMENTS CONT’D
 
The Board concluded that, in light of the foregoing factors and the nature, extent and quality of the services rendered, the profits realized by the Adviser and its affiliates are reasonable.
 
Economies of Scale
 
In reviewing management fees and profitability, the Board also considered the extent to which the Adviser and its affiliates, on the one hand, and each Fund, on the other hand, can expect to realize benefits from economies of scale as the assets of the Fund increase. The Board acknowledged the difficulty in accurately measuring the benefits resulting from the economies of scale with respect to the management of any specific fund or group of funds. The Board also considered the fact that none of the Funds is continuously offered and concluded that, in light of the level of the Adviser’s profits with respect to each Fund, the implementation of breakpoints in the advisory fee schedule is not appropriate at this time. Based upon the foregoing, the Board concluded that the benefits from economies of scale are currently being shared equitably by the Adviser and its affiliates and each Fund.

78

 

Eaton Vance Municipal Bond Funds 
 
OFFICERS AND TRUSTEES
 
 
     
Officers
Cynthia J. Clemson
President of EIA, MIW,
NYH, EIO and EIP;
Vice President of
MAB, EIV and EMJ

Thomas M. Metzold
President of MAB, EIV and EMJ;
Vice President of EIA and EIP

William H. Ahern, Jr.
Vice President of MIW, EIV and EIO

Craig R. Brandon
Vice President of EIA and NYH

Adam A. Weigold
Vice President of EIP

Barbara E. Campbell
Treasurer

Maureen A. Gemma
Secretary and Chief Legal Officer

Paul M. O’Neil
Chief Compliance Officer
  
Trustees
Ralph F. Verni
Chairman

Benjamin C. Esty

Thomas E. Faust Jr.

Allen R. Freedman

William H. Park

Ronald A. Pearlman

Helen Frame Peters

Heidi L. Steiger

Lynn A. Stout
 
 
Number of Employees
Each Fund is organized as a Massachusetts business trust and is registered under the Investment Company Act of 1940, as amended, as a non-diversified, closed-end management investment company and has no employees.
 
Number of Shareholders
As of March 31, 2010, our records indicate that there are 66, 25, 18, 22, 22, 36, 48 and 94 registered shareholders for Municipal Bond Fund II, California Municipal Bond Fund II, Massachusetts Municipal Bond Fund, Michigan Municipal Bond Fund, New Jersey Municipal Bond Fund, New York Municipal Bond Fund II, Ohio Municipal Bond Fund and Pennsylvania Municipal Bond Fund, respectively, and approximately 4,334, 1,329, 803, 893, 1,275, 1,209, 1,358 and 1,698 shareholders owning the Fund shares in street name, such as through brokers, banks and financial intermediaries for Municipal Bond Fund II, California Municipal Bond Fund II, Massachusetts Municipal Bond Fund, Michigan Municipal Bond Fund, New Jersey Municipal Bond Fund, New York Municipal Bond Fund II, Ohio Municipal Bond Fund and Pennsylvania Municipal Bond Fund, respectively.
 
If you are a street name shareholder and wish to receive Fund reports directly, which contain important information about a Fund, please write or call:
 
Eaton Vance Distributors, Inc.
Two International Place
Boston, MA 02110
1-800-262-1122
 
                 
NYSE Amex symbols
               
                 
Municipal Bond Fund II
  EIV   New Jersey Municipal Bond Fund   EMJ    
California Municipal Bond Fund II
  EIA   New York Municipal Bond Fund II   NYH    
Massachusetts Municipal Bond Fund
  MAB   Ohio Municipal Bond Fund   EIO    
Michigan Municipal Bond Fund
  MIW   Pennsylvania Municipal Bond Fund   EIP    

79

 

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Investment Adviser and Administrator of
Eaton Vance Municipal Bond Funds
Eaton Vance Management
Two International Place
Boston, MA 02110
 
 
 
Custodian
State Street Bank and Trust Company
200 Clarendon Street
Boston, MA 02116
 
 
 
Transfer Agent
American Stock Transfer & Trust Company
59 Maiden Lane
Plaza Level
New York, NY 10038
 
 
 
 
 
Eaton Vance Municipal Bond Funds
Two International Place
Boston, MA 02110

 

1557-5/10 CE-8IMBIISRC

 

Item 2. Code of Ethics
The registrant has adopted a code of ethics applicable to its Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer. The registrant undertakes to provide a copy of such code of ethics to any person upon request, without charge, by calling 1-800-262-1122.
Item 3. Audit Committee Financial Expert
The registrant’s Board has designated William H. Park, an independent trustee, as its audit committee financial expert. Mr. Park is a certified public accountant who is the Vice Chairman of Commercial Industrial Finance Corp (specialty finance company). Previously, he served as President and Chief Executive Officer of Prizm Capital Management, LLC (investment management firm), as Executive Vice President and Chief Financial Officer of United Asset Management Corporation (an institutional investment management firm) and as a Senior Manager at Price Waterhouse (now PricewaterhouseCoopers) (an independent registered public accounting firm).
Item 4. Principal Accountant Fees and Services
Not required in this filing.
Item 5. Audit Committee of Listed registrants
Not required in this filing.
Item 6. Schedule of Investments
Please see schedule of investments contained in the Report to Stockholders included under Item 1 of this Form N-CSR.
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies
The Board of Trustees of the Trust has adopted a proxy voting policy and procedure (the “Fund Policy”), pursuant to which the Trustees have delegated proxy voting responsibility to the Fund’s investment adviser and adopted the investment adviser’s proxy voting policies and procedures (the “Policies”) which are described below. The Trustees will review the Fund’s proxy voting records from time to time and will annually consider approving the Policies for the upcoming year. In the event that a conflict of interest arises between the Fund’s shareholders and the investment adviser, the administrator, or any of their affiliates or any affiliate of the Fund, the investment adviser will generally refrain from voting the proxies related to the companies giving rise to such conflict until it consults with the Board’s Special Committee except as contemplated under the Fund Policy. The Board’s Special Committee will instruct the investment adviser on the appropriate course of action.
The Policies are designed to promote accountability of a company’s management to its shareholders and to align the interests of management with those shareholders. An independent proxy voting service (“Agent”), currently Institutional Shareholder Services, Inc., has been retained to assist in the voting of proxies through the provision of vote analysis, implementation and recordkeeping and disclosure services. The investment adviser will generally vote proxies through the Agent. The Agent is required to vote all proxies and/or refer then back to the investment adviser pursuant to the Policies. It is generally the policy of the investment adviser to vote in accordance with the recommendation of the Agent. The Agent shall refer to the investment adviser proxies relating to mergers and restructurings, and the disposition of assets, termination, liquidation and mergers contained in mutual fund proxies. The investment adviser will normally vote against anti-takeover measures and other proposals designed to limit the ability of shareholders to act on possible transactions, except in the case of closed-end management investment companies. The investment adviser generally supports management on social and environmental proposals. The investment adviser may abstain from voting from time to time where it determines that the costs associated with voting a proxy outweighs the benefits derived from exercising the right to vote or the economic effect on shareholders interests or the value of the portfolio holding is indeterminable or insignificant.
In addition, the investment adviser will monitor situations that may result in a conflict of interest between the Fund’s shareholders and the investment adviser, the administrator, or any of their affiliates or any affiliate of the Fund by maintaining a list of significant existing and prospective corporate clients. The investment adviser’s personnel responsible for reviewing and voting proxies on behalf of the Fund will report any proxy received or expected to be received from a company included on that

 

 

list to the personal of the investment adviser identified in the Policies. If such personnel expects to instruct the Agent to vote such proxies in a manner inconsistent with the guidelines of the Policies or the recommendation of the Agent, the personnel will consult with members of senior management of the investment adviser to determine if a material conflict of interests exists. If it is determined that a material conflict does exist, the investment adviser will seek instruction on how to vote from the Special Committee.
Information on how the Fund voted proxies relating to portfolio securities during the most recent 12 month period ended June 30 is available (1) without charge, upon request, by calling 1-800-262-1122, and (2) on the Securities and Exchange Commission’s website at http://www.sec.gov.
Item 8. Portfolio Managers of Closed-End Management Investment Companies
Not required in this filing.
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers.
No such purchases this period.
Item 10. Submission of Matters to a Vote of Security Holders.
No Material Changes.
Item 11. Controls and Procedures
(a) It is the conclusion of the registrant’s principal executive officer and principal financial officer that the effectiveness of the registrant’s current disclosure controls and procedures (such disclosure controls and procedures having been evaluated within 90 days of the date of this filing) provide reasonable assurance that the information required to be disclosed by the registrant has been recorded, processed, summarized and reported within the time period specified in the Commission’s rules and forms and that the information required to be disclosed by the registrant has been accumulated and communicated to the registrant’s principal executive officer and principal financial officer in order to allow timely decisions regarding required disclosure.
(b) There have been no changes in the registrant’s internal controls over financial reporting during the second fiscal quarter of the period covered by this report that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 12. Exhibits
     
(a)(1)
  Registrant’s Code of Ethics – Not applicable (please see Item 2).
 
    
(a)(2)(i)
  Treasurer’s Section 302 certification.
 
    
(a)(2)(ii)
  President’s Section 302 certification.
 
    
(b)
  Combined Section 906 certification.

 

 

Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Eaton Vance Pennsylvania Municipal Bond Fund
         
By:
  /s/ Cynthia J. Clemson
 
Cynthia J. Clemson 		   
 
  President    
 
        
Date:
  May 7, 2010    
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
         
By:
  /s/ Barbara E. Campbell
 
Barbara E. Campbell 		   
 
  Treasurer    
 
        
Date:
  May 7, 2010    
 
        
By:
  /s/ Cynthia J. Clemson    
 
       
 
  Cynthia J. Clemson    
 
  President    
 
        
Date:
  May 7, 2010