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 811-6548
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Nuveen Select Tax-Free Income Portfolio
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(Exact name of registrant as specified in charter)
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Address of principal executive offices) (Zip code)
Kevin J. McCarthy
Nuveen Investments
333 West Wacker Drive
Chicago, IL 60606
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(Name and address of agent for service)
Registrant's telephone number, including area code: (312) 917-7700
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Date of fiscal year end: March 31
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Date of reporting period: March 31, 2009
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Form N-CSR is to be used by management investment companies to file reports with
the Commission not later than 10 days after the transmission to stockholders of
any report that is required to be transmitted to stockholders under Rule 30e-1
under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may
use the information provided on Form N-CSR in its regulatory, disclosure review,
inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR,
and the Commission will make this information public. A registrant is not
required to respond to the collection of information contained in Form N-CSR
unless the Form displays a currently valid Office of Management and Budget
("OMB") control number. Please direct comments concerning the accuracy of the
information collection burden estimate and any suggestions for reducing the
burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW,
Washington, DC 20549-0609. The OMB has reviewed this collection of information
under the clearance requirements of 44 U.S.C. ss. 3507.
ITEM 1. REPORTS TO STOCKHOLDERS.
ANNUAL REPORT | Nuveen Investments
March 31, 2009 | MUNICIPAL CLOSED-END FUNDS
[PHOTO OF: SMALL CHILD]
NUVEEN SELECT
TAX-FREE INCOME
PORTFOLIO
NXP
NUVEEN SELECT
TAX-FREE INCOME
PORTFOLIO 2
NXQ
NUVEEN SELECT
TAX-FREE INCOME
PORTFOLIO 3
NXR
NUVEEN CALIFORNIA
SELECT TAX-FREE
INCOME PORTFOLIO
NXC
NUVEEN NEW YORK
SELECT TAX-FREE
INCOME PORTFOLIO
NXN
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Chairman's
LETTER TO SHAREHOLDERS
[PHOTO OF ROBERT P. BREMNER] | Robert P. Bremner | Chairman of the Board
Dear Shareholders,
The problems in the U.S. financial system and the slowdown in global economic
activity continue to create a very difficult environment for the U.S. economy.
The administration, the Federal Reserve System and Congress have initiated a
variety of programs directed at restoring liquidity to the financial markets,
providing financial support for critical financial institutions and stimulating
economic activity. There are encouraging signs that these initiatives are
beginning to have a constructive impact. It is not possible to predict whether
the actions taken to date will be sufficient to restore more normal conditions
in the financial markets or enable the economy to stabilize and set a course
toward recovery. However, the speed and scope of the government's actions are
very encouraging and more importantly, reflect a commitment to act decisively to
meet the economic challenges we face.
The performance information in the attached report reflects the impact of many
negative forces at work in the equity and fixed income markets. The comments by
the portfolio managers describe the strategies being used to pursue your Fund's
long term investment goals. The financial markets continue to experience serious
dislocations and thorough research and strong investment disciplines have never
been more important in identifying risks and opportunities. I hope you will read
this information carefully.
Your Board is particularly sensitive to our shareholders' concerns in these
uncertain times. We believe that frequent and thorough communication is
essential in this regard and encourage you to visit the Nuveen website:
www.nuveen.com, for recent developments in all Nuveen funds. We also encourage
you to communicate with your financial consultant for answers to your questions
and to seek advice on your long term investment strategy in the current market
environment.
On behalf of myself and the other members of your Fund's Board, we look forward
to continuing to earn your trust in the months and years ahead.
Sincerely,
/s/ Robert P. Bremner
Robert P. Bremner
Chairman of the Nuveen Fund Board
May 22, 2009
Portfolio Managers' COMMENTS
Nuveen Investments Municipal Closed-End Funds | NXP, NXQ, NXR, NXC, NXN
Portfolio managers Tom Spalding, Scott Romans, and Cathryn Steeves examine
economic and municipal market conditions at the national and state levels, key
investment strategies, and the twelve-month performance of the Nuveen Select
Portfolios. With 34 years of investment experience, Tom has managed the three
national Portfolios since 1999. Scott, who joined Nuveen in 2000, has managed
NXC since 2003, while Cathryn, who has been with Nuveen since 1996, assumed
portfolio management responsibility for NXN in 2006.
WHAT FACTORS AFFECTED THE U.S. ECONOMY AND MUNICIPAL MARKET DURING THE
TWELVE-MONTH REPORTING PERIOD ENDED MARCH 31, 2009?
During this reporting period, downward pressure on the economy continued and
stress in the financial and credit markets led to increased price volatility for
most securities, reduced liquidity and a general flight to quality. In an effort
to improve overall economic conditions, the Federal Reserve (Fed) cut interest
rates, lowering the fed funds rate from 2.25% at the beginning of the period
(April 2008) to a target range of zero to 0.25%, its lowest level on record. In
March 2009, the Fed announced that, in addition to maintaining the target rate
at its current level, it would buy $300 billion in Treasury securities in an
effort to improve conditions in private credit markets and up to an additional
$750 billion of agency mortgage-backed securities to bolster the housing market.
The Fed's rate-cutting was in part a response to the decline in U.S. economic
growth, as measured by the U.S. gross domestic product (GDP), a closely watched
gauge of economic performance. Since posting growth of 2.8% in the second
quarter of 2008, GDP has contracted at annual rates of 0.5% in the third quarter
of 2008, 6.3% in the fourth quarter of 2008, and 6.1% in the first quarter of
2009, all of which adds up to the worst recession in 50 years (all GDP numbers
annualized). The deepening housing slump also continued to trouble the economy,
with the average home price falling 18.6% between February 2008 and February
2009. In the labor markets, March 2009 marked the fifteenth consecutive month of
job losses and the fourth straight month when employment losses topped 600,000,
bringing the total number of job losses since the economic recession began to
5.1 million. The national unemployment rate for March 2009 was 8.5%. Inflation
remained subdued, as the Consumer Price Index (CPI), reflecting large drops in
energy and transportation prices, fell 0.4% year-over-year as of March 2009. The
core CPI (which excludes food and energy) rose 1.8%. Both numbers were within
the Fed's unofficial objective of 2.0%.
During this period, the nation's financial institutions and markets--including
the municipal bond market--experienced significant turmoil. Reductions in demand
decreased relative valuations of municipal bonds across all credit ratings,
especially those with lower credit ratings and this generally reduced the Fund's
net asset values. As a result, some of these firms were unwilling to commit
their capital to purchase and to serve as a dealers for municipal bonds. The
reduction in dealer involvement in the market was accompanied by
Certain statements in this report are forward-looking statements. Discussions of
specific investments are for illustration only and are not intended as
recommendations of individual investments. The forward-looking statements and
other views expressed herein are those of the portfolio managers as of the date
of this report. Actual future results or occurrences may differ significantly
from those anticipated in any forward-looking statements and the views expressed
herein are subject to change at any time, due to numerous market and other
factors. The Funds disclaim any obligation to update publicly or revise any
forward-looking statements or views expressed herein.
4
significant net selling pressure by investors, particularly related to
lower-rated municipal bonds as institutional investors generally removed money
from the municipal bond market, at least in part because of their need to reduce
the leveraging of their municipal investments. This deleveraging was in part
driven in some measure by the overall reduction in the amount of financing
available for such leverage, the increased cost of such leverage financing and
the need to reduce leverage levels that had recently been increased due to the
decline in municipal bond prices.
Municipal bond prices were further negatively impacted by concerns that the need
for additional deleveraging and a supply overhang (i.e., a large backlog of new
issues that had been postponed) would cause selling pressure to persist. In
addition to falling prices, the municipal market was beset by market conditions
that contributed to greater price volatility, including wider credit spreads
(i.e., lower quality bonds fell in price more than higher quality bonds);
greatly reduced liquidity (i.e., the ability to sell bonds at prices close to
their carrying values), particularly for lower quality bonds; and a lack of
price transparency (i.e., the ability to accurately determine the price at which
a bond would likely trade).
In the municipal bond market, performance over this period was significantly
impacted by concerns about the credit markets, downgrades of municipal bond
insurers and the freeze-up of the auction rate market. The events created surges
of selling pressure as many municipal bond owners tried to sell holdings into a
market already experiencing a lack of liquidity. Combined with the Fed rate
cuts, this produced a steepening of the municipal yield curve. In this
environment, bonds with shorter maturities generally outperformed longer
maturity bonds and higher quality bonds tended to outperform lower quality
credits.
Over the twelve months ended March 31, 2009, municipal bond issuance nationwide
totaled $434.5 billion, a drop of 4% compared with the twelve-month period ended
March 31, 2008. While market conditions during this period impacted the demand
for municipal bonds, investors, especially from the retail sector, continued to
be attracted by the higher interest rates and yields of the municipal bond
market relative to taxable bonds.
HOW WERE ECONOMIC AND MARKET CONDITIONS IN CALIFORNIA AND NEW YORK DURING THIS
PERIOD?
Employment declines, especially in the construction, finance and manufacturing
sectors, far outpaced the modest gains reported in education/health services,
government and leisure and hospitality, the only sectors to report positive
growth. As of March 2009, California's unemployment rate was 11.2%, the highest
level on record, up from 6.4% in March 2008. On the positive side, the state's
economy remained relatively diverse, with technology providing recent economic
support, especially in the areas of renewable energy and medical equipment.
Because of its exposure to riskier, non-traditional mortgage products, the
state's housing market felt the full impact of the sub-prime mortgage crisis as
well as the downturn in the housing sector. Foreclosures in California, which
reached a rate twice the U.S. average, have driven reductions in home prices
throughout the state. According to the Standard & Poor's (S&P)/Case-Shiller home
price index of 20 major metropolitan areas, housing prices in San Francisco, Los
Angeles and San Diego fell 31.0%, 24.1% and 22.9%, respectively, between
February 2008 and February 2009, compared with an average decrease of 18.6%
nationwide. The severe decline in California's housing industry had
ramifications beyond the significant job losses in construction, as declining
home values
5
contributed to a sharp downturn in both consumer spending and government tax
revenues, with weaker tax collections forcing downward revisions to revenue
estimates from state and local governments.
The California legislature adopted a revised $130 billion fiscal 2009-2010 state
budget, closing the gap with $15 billion in spending cuts, $11.4 billion in new
borrowing, $12.8 billion in new taxes and $2 billion from federal stimulus
funds. The spending cuts were spread across a number of budget categories, with
the brunt being borne by K-14 education ($8.4 billion), health and human
services and state payrolls. Tax increases included a one-percent increase in
the state sales tax, increased vehicle license fees, a 0.5% surcharge on
personal income taxes, and a reduction in the dependent tax credit. However,
final approval of several elements of the budget remain subject to voter
approval, with a special election scheduled for May 19, 2009. In addition, delay
in passing the 2009-2010 budget exacerbated California's ongoing cashflow
problems, limiting the state's ability to borrow in the short-term markets to
smooth out uneven cashflows and meet priority payments, including debt service
on bonds. In March 2009, the California legislative analyst's office announced
that a new gap of $8 billion had opened in the state budget.
In February 2009, S&P downgraded its rating on California general obligation
(GO) bonds from A+ to A, while Moody's and Fitch lowered their California GO
ratings from A1 and A+ to A2 and A, respectively, in March 2009. For the twelve
months ended March 31, 2009, municipal issuance in California totaled $62.5
billion, a decrease of 12% from the twelve months ended March 31, 2008.
Although New York somewhat lagged the rest of the nation into the current
recession, the state has now experienced a sharp economic downturn characterized
by mounting job losses, a deteriorating housing market, and a virtual halt in
home construction. The loss of a significant number of manufacturing jobs has
impacted the economies of western and upstate New York, while downstate New
York, especially the New York City area, has been hard hit by financial services
layoffs. The state's retail and construction sectors suffered their biggest job
losses since the recession of 1990-1991, with only the education/health services
and government sectors managing to post minor employment gains. In March 2009,
unemployment in New York was 7.8%, the highest since mid-1993. The jobless rate
in the New York City metropolitan area was slightly higher, at 8.1% as of March
2009. Both rates remained below the March 2009 national unemployment figure of
8.5%. Housing markets across the state continued to weaken, although prices in
New York City fell less than the national average, according to the
S&P/Case-Shiller home price index. Between February 2008 and February 2009,
housing prices in New York City dropped 10.2%, compared with an average decrease
of 18.6% nationwide. Single-family housing starts in the state fell to an
all-time low in 2008, while multi-family starts declined to mid-1990s levels,
reflecting a sharp drop in construction in New York City.
The growing number of job losses in New York has translated into weaker income
growth, which in turn means less tax revenue for state and local governments.
According to the New York State Comptroller, Wall Street bonuses fell an
estimated 45% from a year ago, which meant approximately $1 billion less for the
state income tax revenues. New York has projected a cumulative budget deficit of
more than $15 billion. Proposals for closing this shortfall include tax
increases, spending cuts, and the use of some of the $41 billion in federal
stimulus funds that New York expects to receive, with the balance being used for
6
spending and tax relief. The state has already cut its payroll by about 3,000
employees through attrition and layoffs.
As of March 2009, New York state general obligation bonds were rated Aa3 by
Moody's, AA by S&P, and AA- by Fitch. All three rating agencies maintained
stable outlooks for the state. For the twelve months ended March 31, 2009,
municipal issuance in New York totaled $45.1 billion, an increase of 18.5% from
the previous twelve months.
WHAT KEY STRATEGIES WERE USED TO MANAGE THE NUVEEN SELECT PORTFOLIOS DURING THIS
REPORTING PERIOD?
During this period, as the municipal market was pressured by price volatility
and lack of liquidity, we continued to focus on finding bonds that offered
relative value and investing for the long term.
Our investment activity during this period was driven by opportunities created
by the market conditions of the past twelve months. This was true in both the
new issuance (or primary) municipal bond market and the secondary markets. In
the new issuance market, we were able to purchase bonds with better structures
(e.g., higher coupons, longer call protection). Examples of new issues we added
to NXC during this period included a BBB rated credit issued by Loma Linda
University Medical Center, which offered a coupon of 8.25% and a maturity date
of 2038, and bonds rated Aa3 issued by Santa Clara University with a coupon of
5.625% and a maturity date of 2037. In the secondary markets, we found bonds,
especially lower-rated issues, at extremely discounted prices as the result of
selling by some municipal market participants, particularly in November and
December 2008. We focused on purchasing credit and distressed situations, using
a fundamental approach to discover undervalued sectors and individual credits
with the potential to perform well over the long term. Many of the opportunities
we found during this period were in health care, a sector we follow closely and
know well, while the national Portfolios also added tobacco credits and revenue
bonds in weaker sectors that we believe are attractive candidates for a
performance rebound as the economic environment improves.
Some of the capital for new purchases was generated by a number of bond calls
during this period. In addition, we monitored the types of credits and bond
structures that were attractive to the retail market and took advantage of
strong bids to sell bonds into relatively consistent retail demand. The bonds we
sold tended to be higher quality credits, as these were the most in demand by
retail buyers. In NXC, we also lightened our position in California general
obligation bonds, due to their exposure to the state's ongoing economic
problems.
During this period, we continued to use inverse floating rate securities(1) in
all five of the Select Portfolios. We employ inverse floaters as part of our
management strategies for a variety of reasons, including duration(2) management
and income enhancement. As of March 31, 2009, the inverse floaters remained in
place in all five of these Portfolios. NXN, which generally saw less trading
activity during this period than the other Portfolios, did engage in some buying
and selling related to management of its inverse floater positions, generally
focusing on high quality bonds maturing in 10 to 25 years.
----------
(1) An inverse floating rate trust, also know as inverse floaters, is a
financial instrument designed to pay long-term tax-exempt interest at a rate
that varies inversely with a short-term tax-exempt interest rate index. For
Nuveen Funds, the index typically used is the Securities Industry and Financial
Markets (SIFM) Municipal Swap Index (previously referred to as the Bond Market
Association Index or BMA). Inverse floaters, including those inverse floating
rate securities in which the Portfolios invested during the reporting period,
are further defined within the Notes to Financial Statements and Glossary of
Terms Used in this Report sections of this report.
(2) Duration is a measure of a bond's price sensitivity as interest rates
change, with longer duration bonds displaying more sensitivity to these changes
than bonds with shorter durations.
7
HOW DID THE PORTFOLIOS PERFORM?
Individual results for the Nuveen Select Portfolios, as well as relevant index
and peer group information, are presented in the accompanying table.
Average Annual Total Returns on Net Asset Value
For periods ended 3/31/09
1-Year 5-Year 10-Year
National Portfolios
NXP -0.65% 3.06% 4.14%
NXQ -4.63% 1.86% 3.36%
NXR 0.34% 3.26% 4.05%
Lipper General and
Insured Unleveraged
Municipal Debt Funds
Average(3) -3.05% 2.26% 3.56%
Barclays Capital
Municipal Bond Index(4) 2.27% 3.21% 4.60%
S&P National Municipal
Bond Index(5) 0.04% 2.88% 4.40%
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California Portfolio
NXC -1.30% 2.69% 3.74%
Lipper CA
Municipal Debt Funds
Average(3) -11.04% 0.46% 3.41%
Barclays Capital
CA Municipal
Bond Index(4) 0.19% 2.91% 4.32%
S&P CA Municipal
Bond Index(5) -1.17% 2.74% 4.22%
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New York Portfolio
NXN 1.47% 2.99% 3.97%
Lipper NY
Municipal Debt Funds
Average(3) -9.62% 0.58% 3.71%
Barclays Capital NY
Municipal Bond Index(4) 2.61% 3.32% 4.65%
S&P NY Municipal
Bond Index(5) 1.21% 3.19% 4.59%
For the twelve months ended March 31, 2009, the total returns on net asset value
(NAV) for NXP and NXR exceeded the average return for the Lipper General and
Insured Unleveraged Municipal Debt Funds Average, while NXQ trailed this peer
group average. NXR also outperformed the Standard & Poor's (S&P) National
Municipal Bond Index, while NXP and NXQ lagged this benchmark. NXC outperformed
the Lipper California Municipal Debt Funds Average and performed in line with
the S&P California Municipal
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Past performance is not predictive of future results. Current performance may be
higher or lower than the data shown. Returns do not reflect the deduction of
taxes that shareholders may have to pay on Fund distributions or upon the sale
of Fund shares.
For additional information, see the individual Performance Overview for your
Portfolio in this report.
(3) Each of the Lipper Municipal Debt Funds Averages shown in this report are
calculated using the returns of all closed-end funds in their respective
categories for each period as follows: Lipper General and Insured Unleveraged
Average, 1-year, 8 funds; 5-year, 7 funds; and 10-year, 7 funds; Lipper
California Average, 1-year, 24 funds; 5-year, 23 funds; and 10-year, 12 funds;
and Lipper New York Average, 1-year, 17 funds; 5-year, 16 funds; and 10-year, 6
funds. Portfolio and Lipper returns assume reinvestment of dividends.
(4) The Barclays Capital (formerly Lehman Brothers) Municipal Bond Index is an
unleveraged, unmanaged national index containing a broad range of
investment-grade municipal bonds. The Barclays Capital Municipal Bond Indexes
for California and New York are also unleveraged and unmanaged and comprise a
broad range of municipal bonds issued in California and New York, respectively.
Results for the Barclays Capital indexes do not reflect any expenses.
(5) The Standard & Poor's (S&P) National Municipal Bond Index is an unleveraged,
market value-weighted index designed to measure the performance of the
investment-grade U.S. municipal bond market. The S&P Municipal Bond Indexes for
California and New York are also unleveraged and market value-weighted and
comprise a broad range of investment-grade municipal bonds issued in California
and New York, respectively.
8
Bond Index, while NXN exceeded both the Lipper New York Municipal Debt Funds
Average and the S&P New York Municipal Bond Index. All five of the Portfolios
under-performed the annual returns for their respective Barclays Capital
Municipal Bond Indexes for the period.
Key management factors that influenced the Portfolios' returns during this
period included duration and yield curve positioning, use of inverse floaters,
credit exposure and sector allocations, and individual security selection.
Over the course of this reporting period, the yield curve remained steep. Bonds
in the Barclays Capital Municipal Bond Index with maturities of two to eight
years, especially those maturing in approximately five years, benefited the most
from the interest rate environment during this period. Because they were less
sensitive to interest rate changes, these bonds generally outperformed credits
with longer maturities, with bonds having the longest maturities (22 years and
longer) posting a loss for the period. Although NXQ and NXC had slightly longer
durations than the other three Select Portfolios, all of the Portfolios tended
to be underweighted in the poorly performing longest part of the yield curve. As
a result, duration and yield curve positioning were positive contributors to
performance in all of the Portfolios during this period.
As mentioned earlier, all five of the Select Portfolios used inverse floaters
during this period to help manage duration and enhance income. In addition to
helping to support the Portfolios' income streams, the inverse floaters used in
NXN were a positive contributor to this Portfolio's annual return. However, the
inverse floaters used by NXP, NXQ, NXR and NXC had a negative impact on their
total return performance.
Credit was also a major factor in performance, as the positive contributions
from the Portfolios' duration and yield curve positioning were offset in some of
the Portfolios by their exposures to lower-rated credits during the past twelve
months. Because risk-averse investors generally sought higher quality
investments as disruptions in the financial markets deepened, bonds with higher
credit quality typically performed very well. At the same time, as credit
spreads widened, credits rated BBB or below and non-rated bonds generally posted
poor returns. Among the national Portfolios, NXR benefited from having the
heaviest weighting of AAA rated bonds and the fewest bonds rated BBB, while
NXQ's performance was negatively impacted by its holdings of more BBB and fewer
AAA bonds. NXP had the heaviest exposure to BBB and non-rated bonds among all of
these Portfolios, while NXN held the highest allocation of bonds rated AAA.
Nuveen's research capabilities continue to focus on discovering bonds that offer
value in each credit quality category, and our current allocations to
lower-rated bonds are consistent with our long-term positioning. We continue to
believe that lower-rated credits can offer attractive opportunities despite
their generally greater risks.
During this period, pre-refunded(6) bonds, which are backed by U.S. Treasury
securities, were one of the top performing segments of the market, due primarily
to their shorter effective maturities, higher credit quality and perceived
safety. Additional sectors of the market that generally contributed to the
Portfolios' returns included general obligation
----------
(6) Pre-refundings, also known as advance refundings or refinancings, occur
when an issuer sells new bonds and uses the proceeds to fund principal and
interest payments of older existing bonds. This process often results in lower
borrowing costs for bond issuers.
9
and other tax-backed bonds, water and sewer and education credits. In
particular, NXN's performance was boosted by its overweighting of the water and
sewer sector relative to the general municipal market.
Holdings that generally detracted from the Portfolios' performances included
industrial development revenue (IDR) bonds, which performed very poorly during
this period. The health care revenue sector also underperformed the overall
municipal market. In general, the Portfolios tended to have heavier exposures to
the health care sector than the market as a whole. Next to the IDR sector, zero
coupon bonds were among the worst performing categories in the municipal market,
as were lower-rated tobacco bonds backed by the 1998 master tobacco settlement
agreement.
Individual security selection was also a factor in the Portfolios' performances
during this period. In particular, NXQ's returns were negatively impacted by its
holdings of AMBAC-insured bonds issued for the Las Vegas monorail project, which
links various casinos on the Las Vegas strip. The project has struggled to build
ridership and turn a profit, and proposals to extend the monorail to McCarran
International Airport remain on hold. Also during this period, the Portfolios'
returns were impacted by insured holdings where the insurers backing the bonds
were downgraded, as these bonds then typically traded to their underlying (or
issuer) credit characteristics. In the market environment of the past twelve
months, insured bonds with weaker underlying credits rated BBB or non-rated,
originally purchased because of the higher yields they offered, generally
underperformed insured bonds with underlying credits rated AA.
RECENT DEVELOPMENTS REGARDING BOND INSURANCE COMPANIES
As mentioned above, another factor that had an impact on the Fund's performance
was its positions in bonds backed by municipal bond insurers that experienced
downgrades in their credit ratings. During the period covered by this report,
ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA (formerly XLCA) experienced one or
more rating reductions by at least one or more rating agencies. At the time this
report was prepared, there are no longer any bond insurers rated triple-A by all
three of the major rating agencies (Moody's Investor Service, S&P and Fitch) and
at least one rating agency has placed each of these insurers on "negative credit
watch," "credit outlook developing" or "rating withdrawn," which may presage one
or more rating reductions for such insurer or insurers in the future. As concern
increased about the balance sheets of these insurers, prices on bonds insured by
these companies - especially those bonds with weaker underlying credits -
declined, detracting from the Funds' performance. By the end of this period,
most insured bonds were being valued according to their fundamentals as if they
were uninsured. On the whole, the holdings of all of our Funds continued to be
well diversified not only between insured and uninsured bonds, but also within
the insured bond category. It is important to note that municipal bonds
historically have had a very low rate of default.
10
Dividend and Share Price INFORMATION
The dividends of NXP, NXQ, NXR, NXC and NXN remained stable throughout the
twelve-month reporting period ended March 31, 2009.
All of these Portfolios seek to pay stable dividends at rates that reflect each
Portfolio's past results and projected future performance. During certain
periods, each Portfolio may pay dividends at a rate that may be more or less
than the amount of net investment income actually earned by the Portfolio during
the period. If a Portfolio has cumulatively earned more than it has paid in
dividends, it holds the excess in reserve as undistributed net investment income
(UNII) as part of the Portfolio's NAV. Conversely, if a Portfolio has
cumulatively paid dividends in excess of its earnings, the excess constitutes
negative UNII that is likewise reflected in the Portfolio's NAV. Each Portfolio
will, over time, pay all of its net investment income as dividends to
shareholders. As of March 31, 2009, NXP and NXQ had positive UNII balances for
both tax purposes and financial statement purposes, while NXR, NXC, and NXN had
positive UNII balances for tax purposes and negative UNII balances for financial
statement purposes.
SHARE REPURCHASES AND SHARE PRICE INFORMATION
Each Fund intends to repurchase shares of its own common stock in the future at
such times and in such amounts as is deemed advisable. During the period covered
by this report, the Funds did not repurchase any of their common shares.
Any future repurchases will be reported to shareholders in the next annual or
semi-annual report.
As of March 31, 2009, the share prices of the Portfolios were trading at
premiums or discounts to their common share NAVs as shown in the accompanying
table:
3/31/09 Twelve-Month Average
+Premium/-Discount +Premium/-Discount
NXP +1.11% +0.38%
NXQ +4.04% +1.25%
NXR +1.42% -0.25%
NXC -9.37% -2.83%
NXN -2.17% -3.20%
11
NXP Performance OVERVIEW | Nuveen Select Tax-Free Income Portfolio
as of March 31, 2009
FUND SNAPSHOT
--------------------------------------------------------------------------------
Share Price 13.67
--------------------------------------------------------------------------------
Net Asset Value 13.52
--------------------------------------------------------------------------------
Premium/(Discount) to NAV 1.11%
--------------------------------------------------------------------------------
Market Yield 5.00%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(2) 6.94%
--------------------------------------------------------------------------------
Net Assets ($000) $ 222,114
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 11.64
--------------------------------------------------------------------------------
Modified Duration 5.67
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 3/19/92)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 0.89% -0.65%
--------------------------------------------------------------------------------
5-Year 4.23% 3.06%
--------------------------------------------------------------------------------
10-Year 3.93% 4.14%
--------------------------------------------------------------------------------
STATES
(as a % of total municipal bonds)
--------------------------------------------------------------------------------
Illinois 13.4%
--------------------------------------------------------------------------------
Colorado 12.3%
--------------------------------------------------------------------------------
South Carolina 8.6%
--------------------------------------------------------------------------------
Texas 8.0%
--------------------------------------------------------------------------------
Washington 7.8%
--------------------------------------------------------------------------------
Florida 7.6%
--------------------------------------------------------------------------------
Indiana 7.4%
--------------------------------------------------------------------------------
California 5.6%
--------------------------------------------------------------------------------
Nevada 5.3%
--------------------------------------------------------------------------------
New Jersey 2.5%
--------------------------------------------------------------------------------
New Mexico 2.2%
--------------------------------------------------------------------------------
Oklahoma 2.1%
--------------------------------------------------------------------------------
Wisconsin 2.0%
--------------------------------------------------------------------------------
Alaska 1.9%
--------------------------------------------------------------------------------
Other 13.3%
--------------------------------------------------------------------------------
INDUSTRIES
(as a % of total investments)
--------------------------------------------------------------------------------
U.S. Guaranteed 33.4%
--------------------------------------------------------------------------------
Health Care 21.7%
--------------------------------------------------------------------------------
Transportation 10.9%
--------------------------------------------------------------------------------
Tax Obligation/Limited 9.2%
--------------------------------------------------------------------------------
Utilities 9.2%
--------------------------------------------------------------------------------
Consumer Staples 5.1%
--------------------------------------------------------------------------------
Other 10.5%
--------------------------------------------------------------------------------
Credit Quality (as a % of total investments)(1)
[PIE CHART]
AAA/U.S.
Guaranteed 40%
AA 31%
A 14%
BBB 12%
BB or Lower 1%
N/R or N/A 2%
2008-2009 Monthly Tax-Free Dividends Per Share
[BAR CHART]
Apr $ 0.057
May 0.057
Jun 0.057
Jul 0.057
Aug 0.057
Sep 0.057
Oct 0.057
Nov 0.057
Dec 0.057
Jan 0.057
Feb 0.057
Mar 0.057
Share Price Performance -- Weekly Closing Price
[LINE CHART]
4/01/08 $ 14.26
14.24
14.26
14.27
14.28
14.54
14.84
14.88
14.76
14.64
14.64
14.08
13.74
13.83
14.2
13.89
13.99
13.996
14.35
14.35
14.1
14.25
14.29
14.2201
14.291
14.02
13.48
13.47
12.41
12.87
13.24
13.8
13.75
13.56
13.3
13.25
13.074
12.65
13.45
13.03
13.87
14
14
13.72
14.17
13.88
13.9599
13.3
13.97
13.83
13.66
13.6999
13.7
3/31/09 13.67
(1) The percentages shown in the foregoing chart may reflect the ratings on
certain bonds insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI, and SYNCORA as
of March 31, 2009. Please see the Portfolio Managers' Commentary for an
expanded discussion of the affect on the Fund of changes to the ratings of
certain bonds in the portfolio resulting from changes to the ratings of
the underlying insurers both during the period and after period end.
(2) Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a income tax rate of 28%. When comparing
this Fund to investments that generate qualified dividend income, the
Taxable-Equivalent Yield is lower.
12
NXQ Performance OVERVIEW | Nuveen Select Tax-Free Income Portfolio 2
as of March 31, 2009
Credit Quality (as a % of total investments)(1)
[PIE CHART]
AAA/U.S.
Guaranteed 40%
AA 31%
A 18%
BBB 10%
BB or Lower and N/R or N/A 1%
2008-2009 Monthly Tax-Free Dividends Per Share
[BAR CHART]
Apr $ 0.0555
May 0.0555
Jun 0.0555
Jul 0.0555
Aug 0.0555
Sep 0.0555
Oct 0.0555
Nov 0.0555
Dec 0.0555
Jan 0.0555
Feb 0.0555
Mar 0.0555
Share Price Performance -- Weekly Closing Price
[LINE CHART]
4/01/08 $ 13.84
13.91
14.27
14.26
14.24
14.35
14.45
14.37
14.35
14.25
14.01
13.67
13.46
13.71
13.8166
13.89
13.9
13.996
14
14.17
14.05
14.02
14.04
14.1
13.72
13.33
13.002
13.1
11.5701
11.91
12.56
12.66
13.12
13.11
11.93
12.6
12.06
11.37
12.49
12.63
13.4
13.64
13.2
13.11
13.37
13.51
13.34
13.19
13.27
12.85
13.05
12.74
13.28
3/31/09 13.144
FUND SNAPSHOT
--------------------------------------------------------------------------------
Share Price 13.14
--------------------------------------------------------------------------------
Net Asset Value 12.63
--------------------------------------------------------------------------------
Premium/(Discount) to NAV 4.04%
--------------------------------------------------------------------------------
Market Yield 5.07%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(2) 7.04%
--------------------------------------------------------------------------------
Net Assets ($000) $ 222,771
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 13.67
--------------------------------------------------------------------------------
Modified Duration 6.55
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 5/21/92)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 0.24% -4.63%
--------------------------------------------------------------------------------
5-Year 4.05% 1.86%
--------------------------------------------------------------------------------
10-Year 3.77% 3.36%
--------------------------------------------------------------------------------
STATES
(as a % of total municipal bonds)
--------------------------------------------------------------------------------
Illinois 14.2%
--------------------------------------------------------------------------------
Texas 12.2%
--------------------------------------------------------------------------------
Colorado 10.7%
--------------------------------------------------------------------------------
California 6.8%
--------------------------------------------------------------------------------
South Carolina 6.0%
--------------------------------------------------------------------------------
Indiana 4.0%
--------------------------------------------------------------------------------
New York 3.7%
--------------------------------------------------------------------------------
Iowa 3.5%
--------------------------------------------------------------------------------
Massachusetts 3.3%
--------------------------------------------------------------------------------
New Mexico 3.1%
--------------------------------------------------------------------------------
Nevada 3.1%
--------------------------------------------------------------------------------
Washington 3.1%
--------------------------------------------------------------------------------
Pennsylvania 2.6%
--------------------------------------------------------------------------------
Louisiana 2.5%
--------------------------------------------------------------------------------
Florida 2.4%
--------------------------------------------------------------------------------
New Jersey 1.8%
--------------------------------------------------------------------------------
Rhode Island 1.7%
--------------------------------------------------------------------------------
Ohio 1.6%
--------------------------------------------------------------------------------
Other 13.7%
--------------------------------------------------------------------------------
INDUSTRIES
(as a % of total investments)
--------------------------------------------------------------------------------
U.S. Guaranteed 25.2%
--------------------------------------------------------------------------------
Health Care 18.6%
--------------------------------------------------------------------------------
Transportation 12.7%
--------------------------------------------------------------------------------
Tax Obligation/Limited 10.7%
--------------------------------------------------------------------------------
Utilities 9.1%
--------------------------------------------------------------------------------
Tax Obligation/General 5.2%
--------------------------------------------------------------------------------
Consumer Staples 4.5%
--------------------------------------------------------------------------------
Other 14.0%
--------------------------------------------------------------------------------
(1) The percentages shown in the foregoing chart may reflect the ratings on
certain bonds insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as
of March 31, 2009. Please see the Portfolio Managers' Commentary for an
expanded discussion of the affect on the Fund of changes to the ratings of
certain bonds in the portfolio resulting from changes to the ratings of
the underlying insurers both during the period and after period end.
(2) Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a income tax rate of 28%. When comparing
this Fund to investments that generate qualified dividend income, the
Taxable-Equivalent Yield is lower.
13
NXR Performance OVERVIEW | Nuveen Select Tax-Free Income Portfolio 3
as of March 31, 2009
FUND SNAPSHOT
--------------------------------------------------------------------------------
Share Price 13.57
--------------------------------------------------------------------------------
Net Asset Value 13.38
--------------------------------------------------------------------------------
Premium/(Discount) to NAV 1.42%
--------------------------------------------------------------------------------
Market Yield 4.73%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(2) 6.57%
--------------------------------------------------------------------------------
Net Assets ($000) $ 173,678
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 12.28
--------------------------------------------------------------------------------
Modified Duration 6.16
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 7/24/92)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year 3.51% 0.34%
--------------------------------------------------------------------------------
5-Year 5.03% 3.26%
--------------------------------------------------------------------------------
10-Year 4.35% 4.05%
--------------------------------------------------------------------------------
STATES
(as a % of total municipal bonds)
--------------------------------------------------------------------------------
Illinois 19.2%
--------------------------------------------------------------------------------
Texas 9.8%
--------------------------------------------------------------------------------
California 9.3%
--------------------------------------------------------------------------------
Colorado 7.1%
--------------------------------------------------------------------------------
Indiana 6.6%
--------------------------------------------------------------------------------
Florida 5.7%
--------------------------------------------------------------------------------
Iowa 5.7%
--------------------------------------------------------------------------------
North Carolina 4.4%
--------------------------------------------------------------------------------
Nevada 3.6%
--------------------------------------------------------------------------------
New York 3.3%
--------------------------------------------------------------------------------
South Carolina 3.3%
--------------------------------------------------------------------------------
New Mexico 2.8%
--------------------------------------------------------------------------------
Michigan 2.5%
--------------------------------------------------------------------------------
Pennsylvania 2.3%
--------------------------------------------------------------------------------
Other 14.4%
--------------------------------------------------------------------------------
INDUSTRIES
(as a % of total investments)
--------------------------------------------------------------------------------
U.S. Guaranteed 25.1%
--------------------------------------------------------------------------------
Health Care 19.0%
--------------------------------------------------------------------------------
Utilities 17.4%
--------------------------------------------------------------------------------
Tax Obligation/Limited 12.3%
--------------------------------------------------------------------------------
Transportation 7.4%
--------------------------------------------------------------------------------
Tax Obligation/General 5.3%
--------------------------------------------------------------------------------
Other 13.5%
--------------------------------------------------------------------------------
Credit Quality (as a % of total investments)(1)
[PIE CHART]
AAA/U.S.
Guaranteed 43%
AA 32%
A 16%
BBB 8%
BB or Lower and N/R or N/A 1%
2008-2009 Monthly Tax-Free Dividends Per Share
[BAR CHART]
Apr $ 0.0535
May 0.0535
Jun 0.0535
Jul 0.0535
Aug 0.0535
Sep 0.0535
Oct 0.0535
Nov 0.0535
Dec 0.0535
Jan 0.0535
Feb 0.0535
Mar 0.0535
Share Price Performance -- Weekly Closing Price
[LINE CHART]
4/01/08 $ 13.85
14.03
13.9
13.96
13.89
14.12
14.4
14.3
14.06
14.01
13.9
14
13.85
13.9999
13.7
13.72
13.71
13.9
13.88
13.97
13.92
13.9001
14.1599
14.25
14.08
13.65
13.06
13.28
11.97
12.15
12.79
12.97
12.99
12.97
12.29
12.7
12.47
11.91
12.84
13.08
13.77
13.955
13.74
13.6
13.86
13.8
13.98
13.57
13.75
13.48
13.62
13.388
13.69
3/31/09 13.5736
(1) The percentages shown in the foregoing chart may reflect the ratings on
certain bonds insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as
of March 31, 2009. Please see the Portfolio Managers' Commentary for an
expanded discussion of the affect on the Fund of changes to the ratings of
certain bonds in the portfolio resulting from changes to the ratings of
the underlying insurers both during the period and after period end.
(2) Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a income tax rate of 28%. When comparing
this Fund to investments that generate qualified dividend income, the
Taxable-Equivalent Yield is lower.
14
NXC Performance OVERVIEW | Nuveen California Select Tax-Free Income Portfolio
as of March 31, 2009
Credit Quality (as a % of total investments)(1)
[PIE CHART]
AAA/U.S.
Guaranteed 22%
AA 37%
A 27%
BBB 11%
N/R or N/A 3%
2008-2009 Monthly Tax-Free Dividends Per Share
[BAR CHART]
Apr $ 0.0555
May 0.0555
Jun 0.0555
Jul 0.0555
Aug 0.0555
Sep 0.0555
Oct 0.0555
Nov 0.0555
Dec 0.0555
Jan 0.0555
Feb 0.0555
Mar 0.0555
Share Price Performance -- Weekly Closing Price
[LINE CHART]
4/01/08 $ 14.0101
14.22
14
14
14.18
14.06
14.1675
14.25
14.45
14.45
14.3
14.2
14.012
14.06
14.12
13.99
13.697
13.75
14.39
14.4
14.01
13.81
14.03
14.18
14.23
13.5
13.2
13.99
10.8
11.8
12.89
12.89
12.91
12.8
12.15
11.75
12.15
11.54
11.9
11.49
12.62
12.81
12.55
12.43
12.76
13.07
13.36
12.36
12.54
12.05
12.2342
12.03
12.06
3/31/09 12
FUND SNAPSHOT
--------------------------------------------------------------------------------
Share Price 12.00
--------------------------------------------------------------------------------
Net Asset Value 13.24
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -9.37%
--------------------------------------------------------------------------------
Market Yield 5.55%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(2) 8.53%
--------------------------------------------------------------------------------
Net Assets ($000) $ 82,953
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 14.20
--------------------------------------------------------------------------------
Modified Duration 7.37
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 6/19/92)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year -10.34% -1.30%
--------------------------------------------------------------------------------
5-Year 1.80% 2.69%
--------------------------------------------------------------------------------
10-Year 2.61% 3.74%
--------------------------------------------------------------------------------
INDUSTRIES
(as a % of total investments)
--------------------------------------------------------------------------------
Tax Obligation/General 22.5%
--------------------------------------------------------------------------------
Tax Obligation/Limited 20.3%
--------------------------------------------------------------------------------
U.S. Guaranteed 14.5%
--------------------------------------------------------------------------------
Health Care 10.2%
--------------------------------------------------------------------------------
Education and Civic Organizations 9.7%
--------------------------------------------------------------------------------
Transportation 5.7%
--------------------------------------------------------------------------------
Utilities 5.3%
--------------------------------------------------------------------------------
Other 11.8%
--------------------------------------------------------------------------------
(1) The percentages shown in the foregoing chart may reflect the ratings on
certain bonds insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as
of March 31, 2009. Please see the Portfolio Managers' Commentary for an
expanded discussion of the affect on the Fund of changes to the ratings of
certain bonds in the portfolio resulting from changes to the ratings of
the underlying insurers both during the period and after period end.
(2) Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 34.9%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
15
NXN Performance OVERVIEW | Nuveen New York Select Tax-Free Income Portfolio
as of March 31, 2009
FUND SNAPSHOT
--------------------------------------------------------------------------------
Share Price 13.08
--------------------------------------------------------------------------------
Net Asset Value 13.37
--------------------------------------------------------------------------------
Premium/(Discount) to NAV -2.17%
--------------------------------------------------------------------------------
Market Yield 4.68%
--------------------------------------------------------------------------------
Taxable-Equivalent Yield(2) 6.97%
--------------------------------------------------------------------------------
Net Assets ($000) $ 52,268
--------------------------------------------------------------------------------
Average Effective Maturity on Securities (Years) 14.84
--------------------------------------------------------------------------------
Modified Duration 5.82
--------------------------------------------------------------------------------
AVERAGE ANNUAL TOTAL RETURN
(Inception 6/19/92)
--------------------------------------------------------------------------------
ON SHARE PRICE ON NAV
--------------------------------------------------------------------------------
1-Year -0.57% 1.47%
--------------------------------------------------------------------------------
5-Year 3.02% 2.99%
--------------------------------------------------------------------------------
10-Year 3.86% 3.97%
--------------------------------------------------------------------------------
INDUSTRIES
(as a % of total investments)
--------------------------------------------------------------------------------
Tax Obligation/Limited 16.7%
--------------------------------------------------------------------------------
Health Care 13.3%
--------------------------------------------------------------------------------
Water and Sewer 12.7%
--------------------------------------------------------------------------------
Long-Term Care 11.7%
--------------------------------------------------------------------------------
Education and Civic Organizations 9.8%
--------------------------------------------------------------------------------
Tax Obligation/General 8.6%
--------------------------------------------------------------------------------
Housing/Single Family 8.3%
--------------------------------------------------------------------------------
U.S. Guaranteed 6.2%
--------------------------------------------------------------------------------
Other 12.7%
--------------------------------------------------------------------------------
Credit Quality (as a % of total investments)(1)
[PIE CHART]
AAA/U.S.
Guaranteed 45%
AA 31%
A 13%
BBB 7%
BB or Lower 1%
N/R or N/A 3%
2008-2009 Monthly Tax-Free Dividends Per Share
[BAR CHART]
Apr $ 0.051
May 0.051
Jun 0.051
Jul 0.051
Aug 0.051
Sep 0.051
Oct 0.051
Nov 0.051
Dec 0.051
Jan 0.051
Feb 0.051
Mar 0.051
Share Price Performance -- Weekly Closing Price
[LINE CHART]
4/01/08 $ 13.84
13.79
13.57
13.78
13.5
13.68
13.78
14.09
13.69
13.76
13.73
13.51
13.59
13.6
13.68
13.69
13.82
13.65
13.66
13.72
13.85
13.63
13.8
13.909
13.553
12.8
12.81
12.414
12.62
11.45
12.37
12.27
12.65
12.4274
11.46
11.6625
11.6301
11.53
11.58
11.7
12.66
12.86
12.97
13.24
12.9499
13
13.28
12.634
12.85
12.7501
13.0099
13.2
13.33
3/31/09 13.08
(1) The percentages shown in the foregoing chart may reflect the ratings on
certain bonds insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as
of March 31, 2009. Please see the Portfolio Managers' Commentary for an
expanded discussion of the affect on the Fund of changes to the ratings of
certain bonds in the portfolio resulting from changes to the ratings of
the underlying insurers both during the period and after period end.
(2) Taxable-Equivalent Yield represents the yield that must be earned on a
fully taxable investment in order to equal the yield of the Fund on an
after-tax basis. It is based on a combined federal and state income tax
rate of 32.9%. When comparing this Fund to investments that generate
qualified dividend income, the Taxable-Equivalent Yield is lower.
16
Report of INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
TO THE BOARD OF TRUSTEES AND SHAREHOLDERS
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 2
NUVEEN SELECT TAX-FREE INCOME PORTFOLIO 3
NUVEEN CALIFORNIA SELECT TAX-FREE INCOME PORTFOLIO
NUVEEN NEW YORK SELECT TAX-FREE INCOME PORTFOLIO
We have audited the accompanying statements of assets and liabilities, including
the portfolios of investments, of Nuveen Select Tax-Free Income Portfolio,
Nuveen Select Tax-Free Income Portfolio 2, Nuveen Select Tax-Free Income
Portfolio 3, Nuveen California Select Tax-Free Income Portfolio and Nuveen New
York Select Tax-Free Income Portfolio, as of March 31, 2009, and the related
statements of operations for the year then ended, the statements of changes in
net assets for each of the two years in the period then ended and the financial
highlights for each of the five years in the period then ended. These financial
statements and financial highlights are the responsibility of the Funds'
management. Our responsibility is to express an opinion on these financial
statements and financial highlights based on our audits.
We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements and financial highlights are free of material misstatement. We were
not engaged to perform an audit of the Funds' internal control over financial
reporting. Our audits included consideration of internal control over financial
reporting as a basis for designing audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Funds' internal control over financial reporting.
Accordingly, we express no such opinion. An audit also includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements and financial highlights, assessing the accounting principles used
and significant estimates made by management and evaluating the overall
financial statement presentation. Our procedures included confirmation of
securities owned as of March 31, 2009, by correspondence with the custodian and
brokers. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial positions of
Nuveen Select Tax-Free Income Portfolio, Nuveen Select Tax-Free Income Portfolio
2, Nuveen Select Tax-Free Income Portfolio 3, Nuveen California Select Tax-Free
Income Portfolio and Nuveen New York Select Tax-Free Income Portfolio at March
31, 2009, the results of their operations for the year then ended, the changes
in their net assets for each of the two years in the period then ended and the
financial highlights for each of the five years in the period then ended in
conformity with US generally accepted accounting principles.
Ernst & Young LLP
Chicago, Illinois
May 22, 2009
17
NXP | Nuveen Select Tax-Free Income Portfolio
| Portfolio of INVESTMENTS
March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS - 97.7%
ALASKA - 1.8%
$ 2,475 Alaska Municipal Bond Bank Authority, General Obligation Bonds, 12/13 at 100.00 AA (4) $ 2,864,144
Series 2003E, 5.250%, 12/01/23 (Pre-refunded 12/01/13) - MBIA
Insured
2,500 Northern Tobacco Securitization Corporation, Alaska, Tobacco 6/14 at 100.00 Baa3 1,255,450
Settlement Asset-Backed Bonds, Series 2006A, 5.000%, 6/01/46
------------------------------------------------------------------------------------------------------------------------------------
4,975 Total Alaska 4,119,594
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 0.3%
5,915 Arkansas Development Finance Authority, Tobacco Settlement Revenue No Opt. Call Aa3 649,526
Bonds, Arkansas Cancer Research Center Project, Series 2006,
0.000%, 7/01/46 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 5.4%
2,000 Alameda Corridor Transportation Authority, California, Subordinate 10/17 at 100.00 A 1,413,880
Lien Revenue Bonds, Series 2004A, 0.000%, 10/01/25 - AMBAC Insured
3,325 California Department of Water Resources, Power Supply Revenue Bonds, 5/12 at 101.00 Aa3 3,618,431
Series 2002A, 6.000%, 5/01/14
1,000 California Statewide Community Development Authority, Revenue Bonds, 8/19 at 100.00 AA 1,013,600
Methodist Hospital Project, Series 2009, 6.750%, 2/01/38
3,000 Golden State Tobacco Securitization Corporation, California, Tobacco 6/13 at 100.00 AAA 3,530,280
Settlement Asset-Backed Bonds, Series 2003A-1, 6.750%, 6/01/39
(Pre-refunded 6/01/13)
1,130 Los Angeles Department of Water and Power, California, Waterworks 7/11 at 100.00 AA 1,074,415
Revenue Refunding Bonds, Series 2001A, 5.125%, 7/01/41 - FGIC
Insured
365 Los Angeles, California, Parking System Revenue Bonds, Series 1999A, 5/09 at 101.00 A+ 365,172
5.250%, 5/01/29 - AMBAC Insured
1,000 Moreno Valley Unified School District, Riverside County, California, No Opt. Call AA 427,770
General Obligation Bonds, Series 2007, 0.000%, 8/01/23 - MBIA
Insured
750 Tobacco Securitization Authority of Northern California, Tobacco 6/15 at 100.00 BBB 405,150
Settlement Asset-Backed Bonds, Series 2005A-1, 5.500%, 6/01/45
1,150 Woodside Elementary School District, San Mateo County, California, No Opt. Call AA+ 289,179
General Obligation Bonds, Series 2007, 0.000%, 10/01/30 - AMBAC
Insured
------------------------------------------------------------------------------------------------------------------------------------
13,720 Total California 12,137,877
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 12.1%
1,700 Colorado Health Facilities Authority, Revenue Bonds, Catholic Health 3/12 at 100.00 AA (4) 1,878,687
Initiatives, Series 2002A, 5.500%, 3/01/22 (ETM)
690 Colorado Health Facilities Authority, Revenue Bonds, Catholic Health 3/12 at 100.00 AA (4) 769,895
Initiatives, Series 2002A, 5.500%, 3/01/22 (Pre-refunded 3/01/12)
390 Colorado Water Resources and Power Development Authority, Small Water 11/10 at 100.00 N/R 384,907
Resources Revenue Bonds, Series 2000A, 5.800%, 11/01/20 - FGIC
Insured
8,225 Denver City and County, Colorado, Airport System Revenue Bonds, No Opt. Call A+ 8,867,372
Series 1991D, 7.750%, 11/15/13 (Alternative Minimum Tax)
18
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO (continued)
5,000 Denver City and County, Colorado, Airport System Revenue Refunding 11/11 at 100.00 AA- $ 5,019,650
Bonds, Series 2001A, 5.625%, 11/15/17 - FGIC Insured (Alternative
Minimum Tax)
3,000 Denver Convention Center Hotel Authority, Colorado, Senior Revenue 12/13 at 100.00 N/R (4) 3,382,170
Bonds, Convention Center Hotel, Series 2003A, 5.000%, 12/01/23
(Pre-refunded 12/01/13) - SYNCORA GTY Insured
500 Denver, Colorado, Airport System Revenue Refunding Bonds, Series 11/13 at 100.00 A+ 470,960
2003B, 5.000%, 11/15/33 - SYNCORA GTY Insured
5,000 E-470 Public Highway Authority, Colorado, Senior Revenue Bonds, 9/10 at 31.42 Aaa 1,537,700
Series 2000B, 0.000%, 9/01/28 (Pre-refunded 9/01/10) - MBIA Insured
12,500 E-470 Public Highway Authority, Colorado, Toll Revenue Bonds, Series 9/26 at 54.77 AA 983,000
2006A, 0.000%, 9/01/38 - MBIA Insured
3,160 Northwest Parkway Public Highway Authority, Colorado, Revenue Bonds, 6/11 at 102.00 A (4) 3,493,538
Senior Series 2001A, 5.500%, 6/15/20 (Pre-refunded 6/15/11) -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
40,165 Total Colorado 26,787,879
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.1%
60 District of Columbia, Revenue Bonds, Catholic University of America, 10/09 at 101.00 A 60,479
Series 1999, 5.625%, 10/01/29 - AMBAC Insured
205 District of Columbia, Revenue Bonds, Catholic University of America, 10/09 at 101.00 A (4) 212,036
Series 1999, 5.625%, 10/01/29 (Pre-refunded 10/01/09) - AMBAC
Insured
------------------------------------------------------------------------------------------------------------------------------------
265 Total District of Columbia 272,515
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 7.4%
2,000 Halifax Hospital Medical Center, Florida, Revenue Bonds, Series 2006, 6/16 at 100.00 BBB+ 1,460,480
5.375%, 6/01/46
5,000 Jacksonville Health Facilities Authority, Florida, Revenue Bonds, 11/12 at 101.00 Aa1 4,775,100
Ascension Health, Series 2002A, 5.250%, 11/15/32
10,000 JEA St. John's River Power Park System, Florida, Revenue Refunding 10/11 at 100.00 Aa2 10,273,999
Bonds, Issue 2, Series 2002-17, 5.000%, 10/01/17
------------------------------------------------------------------------------------------------------------------------------------
17,000 Total Florida 16,509,579
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 0.6%
1,330 Hawaii, Certificates of Participation, Kapolei State Office Building, 5/09 at 101.00 A 1,346,080
Series 1998A, 5.000%, 5/01/17 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 13.1%
1,965 Board of Trustees of Southern Illinois University, Housing and No Opt. Call AA- 1,165,933
Auxiliary Facilities System Revenue Bonds, Series 1999A, 0.000%,
4/01/20 - MBIA Insured
2,600 Chicago Heights, Illinois, General Obligation Corporate Purpose 6/09 at 100.00 AA- 2,617,888
Bonds, Series 1993, 5.650%, 12/01/17 - FGIC Insured
195 DuPage County Community School District 200, Wheaton, Illinois, 11/13 at 100.00 Aa3 209,432
General Obligation Bonds, Series 2003B, 5.250%, 11/01/20 - FSA
Insured
805 DuPage County Community School District 200, Wheaton, Illinois, 11/13 at 100.00 Aa3 (4) 922,369
General Obligation Bonds, Series 2003B, 5.250%, 11/01/20
(Pre-refunded 11/01/13) - FSA Insured
600 Illinois Educational Facilities Authority, Student Housing Revenue 5/12 at 101.00 Aaa 690,222
Bonds, Educational Advancement Foundation Fund, University Center
Project, Series 2002, 6.000%, 5/01/22 (Pre-refunded 5/01/12)
1,050 Illinois Finance Authority, Revenue Bonds, Loyola University of 7/17 at 100.00 Aa1 977,382
Chicago, Tender Option Bond Trust 1137, 9.208%, 7/01/46 (IF)
4,000 Illinois Finance Authority, Revenue Bonds, Northwestern Memorial 8/14 at 100.00 AA+ (4) 4,656,000
Hospital, Series 2004A, 5.500%, 8/15/43 (Pre-refunded 8/15/14)
19
NXP | Nuveen Select Tax-Free Income Portfolio (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 1,320 Illinois Health Facilities Authority, Revenue Bonds, Decatur Memorial 10/11 at 100.00 A $ 1,330,850
Hospital, Series 2001, 5.600%, 10/01/16
2,950 Illinois Health Facilities Authority, Revenue Bonds, Lake Forest 7/12 at 100.00 A- 3,000,504
Hospital, Series 2002A, 6.000%, 7/01/17
2,275 Illinois Health Facilities Authority, Revenue Refunding Bonds, 1/13 at 100.00 Baa1 2,280,369
Elmhurst Memorial Healthcare, Series 2002, 6.250%, 1/01/17
60 Illinois Health Facilities Authority, Revenue Refunding Bonds, No Opt. Call N/R (4) 60,143
Evangelical Hospitals Corporation, Series 1992B, 6.500%, 4/15/09
(ETM)
75 Illinois Health Facilities Authority, Revenue Refunding Bonds, 5/09 at 100.00 Baa1 65,069
Rockford Health System, Series 1997, 5.000%, 8/15/21 - AMBAC
Insured
3,125 Metropolitan Pier and Exposition Authority, Illinois, Revenue Bonds, No Opt. Call AA- 2,285,344
McCormick Place Expansion Project, Series 1992A, 0.000%, 6/15/17 -
FGIC Insured
810 Metropolitan Pier and Exposition Authority, Illinois, Revenue Bonds, No Opt. Call AAA 237,508
McCormick Place Expansion Project, Series 2002A, 0.000%, 6/15/30 -
MBIA Insured
5,000 Metropolitan Pier and Exposition Authority, Illinois, Revenue 6/12 at 101.00 AAA 5,146,200
Refunding Bonds, McCormick Place Expansion Project, Series 2002B,
5.000%, 6/15/21 - MBIA Insured
1,300 Schaumburg, Illinois, General Obligation Bonds, Series 2004B, 5.250%, 12/14 at 100.00 AA+ 1,310,036
12/01/34 - FGIC Insured Yorkville, Illinois, General Obligation
Debt Certificates, Series 2003:
1,000 5.000%, 12/15/19 (Pre-refunded 12/15/11) - RAAI Insured 12/11 at 100.00 BBB+ (4) 1,102,540
1,000 5.000%, 12/15/20 (Pre-refunded 12/15/11) - RAAI Insured 12/11 at 100.00 BBB+ (4) 1,102,540
------------------------------------------------------------------------------------------------------------------------------------
30,130 Total Illinois 29,160,329
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 7.2%
1,000 Franklin Community Multi-School Building Corporation, Marion County, 7/14 at 100.00 A (4) 1,141,350
Indiana, First Mortgage Revenue Bonds, Series 2004, 5.000%,
7/15/22 (Pre-refunded 7/15/14) - FGIC Insured
2,000 Indiana Health Facility Financing Authority, Hospital Revenue No Opt. Call AAA 2,285,380
Refunding Bonds, Columbus Regional Hospital, Series 1993, 7.000%,
8/15/15 - FSA Insured
1,000 Indiana Health Facility Financing Authority, Revenue Bonds, Community 3/17 at 100.00 BBB 758,520
Foundation of Northwest Indiana, Series 2007, 5.500%, 3/01/37
9,855 Indianapolis Local Public Improvement Bond Bank, Indiana, Waterworks 7/12 at 100.00 AAA 11,058,984
Project, Series 2002A, 5.125%, 7/01/21 (Pre-refunded 7/01/12) -
MBIA Insured
750 West Clark 2000 School Building Corporation, Clark County, Indiana, 1/15 at 100.00 AA+ 780,038
First Mortgage Bonds, Series 2005, 5.000%, 7/15/22 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
14,605 Total Indiana 16,024,272
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 1.4%
1,000 Iowa Tobacco Settlement Authority, Asset Backed Settlement Revenue 6/15 at 100.00 BBB 550,010
Bonds, Series 2005C, 5.375%, 6/01/38
4,000 Iowa Tobacco Settlement Authority, Tobacco Asset-Backed Revenue 6/17 at 100.00 BBB 2,500,480
Bonds, Series 2005B, 5.600%,6/01/34
------------------------------------------------------------------------------------------------------------------------------------
5,000 Total Iowa 3,050,490
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 0.5%
500 Lawrence, Kansas, Hospital Revenue Bonds, Lawrence Memorial Hospital, 7/16 at 100.00 A3 365,015
Series 2006, 4.875%, 7/01/36
750 Wamego, Kansas, Pollution Control Revenue Bonds, Kansas Gas and 6/14 at 100.00 AA- 645,795
Electric Company, Series 2004, 5.300%, 6/01/31 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
1,250 Total Kansas 1,010,810
------------------------------------------------------------------------------------------------------------------------------------
20
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
KENTUCKY - 0.5%
$ 1,100 Jefferson County, Kentucky, Health System Revenue Bonds, Alliant 4/09 at 101.00 AA (4) $ 1,114,366
Health System Inc., Series 1998, 5.125%, 10/01/18 - MBIA Insured
(ETM)
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 0.3%
1,000 Tobacco Settlement Financing Corporation, Louisiana, Tobacco 5/11 at 101.00 BBB 637,550
Settlement Asset-Backed Bonds, Series 2001B, 5.875%, 5/15/39
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 1.0%
500 Massachusetts Health and Educational Facilities Authority, Revenue 7/18 at 100.00 A3 393,530
Bonds, CareGroup Inc., Series 2008E-1, 5.000%, 7/01/28
20 Massachusetts Health and Educational Facilities Authority, Revenue 7/11 at 101.00 AA 21,562
Bonds, Partners HealthCare System Inc., Series 2001C, 6.000%,
7/01/17
480 Massachusetts Health and Educational Facilities Authority, Revenue 7/11 at 101.00 AAA 535,944
Bonds, Partners HealthCare System Inc., Series 2001C, 6.000%,
7/01/17 (Pre-refunded 7/01/11)
1,055 Massachusetts Turnpike Authority, Metropolitan Highway System Revenue 7/09 at 100.00 AA 823,628
Bonds, Senior Series 1997A, 5.000%, 1/01/37 - MBIA Insured
730 Massachusetts Turnpike Authority, Metropolitan Highway System Revenue 7/09 at 101.00 A 565,400
Bonds, Subordinate Series 1999A, 5.000%, 1/01/39 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
2,785 Total Massachusetts 2,340,064
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 1.6%
1,000 Michigan State Hospital Finance Authority, Hospital Revenue Bonds, 8/09 at 100.00 BB 755,290
Detroit Medical Center Obligated Group, Series 1998A, 5.125%,
8/15/18
2,900 Michigan State Hospital Finance Authority, Hospital Revenue Refunding 12/12 at 100.00 AA 2,753,956
Bonds, Trinity Health Credit Group, Series 2002C, 5.375%, 12/01/30
------------------------------------------------------------------------------------------------------------------------------------
3,900 Total Michigan 3,509,246
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 0.1%
230 Minnesota Housing Finance Agency, Single Family Mortgage Revenue 7/09 at 100.50 AA+ 231,877
Bonds, Series 1995A, 5.200%, 1/01/17
------------------------------------------------------------------------------------------------------------------------------------
MISSOURI - 0.7%
5,000 Kansas City Municipal Assistance Corporation, Missouri, Leasehold No Opt. Call AA- 1,520,150
Revenue Bonds, Series 2004B-1, 0.000%, 4/15/30 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 5.1%
2,500 Clark County, Nevada, Motor Vehicle Fuel Tax Highway Improvement 7/13 at 100.00 AA- 2,543,825
Revenue Bonds, Series 2003, 5.000%, 7/01/23 - AMBAC Insured
Director of Nevada State Department of Business and Industry,
Revenue Bonds, Las Vegas Monorail Project, First Tier, Series 2000:
2,360 0.000%, 1/01/21 - AMBAC Insured No Opt. Call A 389,943
4,070 0.000%, 1/01/22 - AMBAC Insured No Opt. Call A 576,963
6,025 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 A 2,066,274
1,500 Las Vegas Redevelopment Agency, Nevada, Tax Increment Revenue Bonds, 6/19 at 100.00 A 1,508,535
Series 2009A, 8.000%, 6/15/30
1,515 Reno, Nevada, Capital Improvement Revenue Bonds, Series 2002, 5.500%, 6/12 at 100.00 Baa1 1,450,991
6/01/21 - FGIC Insured
2,555 Reno, Nevada, Capital Improvement Revenue Bonds, Series 2002, 5.500%, 6/12 at 100.00 Baa1 (4) 2,883,829
6/01/21 (Pre-refunded 6/01/12) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
20,525 Total Nevada 11,420,360
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.2%
380 New Hampshire Housing Finance Authority, Single Family Mortgage 5/11 at 100.00 Aa2 375,425
Acquisition Bonds, Series 2001A, 5.600%, 7/01/21 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
21
NXP | Nuveen Select Tax-Free Income Portfolio (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 2.5%
$ 2,500 New Jersey Health Care Facilities Financing Authority, Revenue 7/13 at 100.00 Ba2 $ 1,510,700
Bonds, Somerset Medical Center, Series 2003, 5.500%, 7/01/23
Tobacco Settlement Financing Corporation, New Jersey, Tobacco
Settlement Asset-Backed Bonds, Series 2002:
1,460 5.750%, 6/01/32 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 1,582,114
1,000 6.000%, 6/01/37 (Pre-refunded 6/01/12) 6/12 at 100.00 AAA 1,143,820
2,500 Tobacco Settlement Financing Corporation, New Jersey, Tobacco 6/17 at 100.00 BBB 1,282,350
Settlement Asset-Backed Bonds, Series 2007-1A, 5.000%, 6/01/41
------------------------------------------------------------------------------------------------------------------------------------
7,460 Total New Jersey 5,518,984
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 2.2%
1,000 New Mexico Mortgage Finance Authority, Multifamily Housing Revenue 9/17 at 100.00 AAA 898,880
Bonds, St Anthony, Series 2007A, 5.250%, 9/01/42 (Alternative
Minimum Tax)
4,000 University of New Mexico, FHA-Insured Mortgage Hospital Revenue 7/14 at 100.00 AAA 3,910,320
Bonds, Series 2004, 4.625%, 7/01/25 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
5,000 Total New Mexico 4,809,200
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 1.2%
1,000 Dormitory Authority of the State of New York, FHA-Insured Mortgage 2/14 at 100.00 AAA 1,002,510
Revenue Bonds, Kaleida Health, Series 2004, 5.050%, 2/15/25
1,215 Dormitory Authority of the State of New York, Revenue Bonds, Mount 7/10 at 101.00 A3 1,243,735
Sinai NYU Health Obligated Group, Series 2000A, 6.500%, 7/01/17
385 Dormitory Authority of the State of New York, Revenue Bonds, Mount 7/10 at 101.00 A3 (4) 417,086
Sinai NYU Health Obligated Group, Series 2000A, 6.500%, 7/01/17
(Pre-refunded 7/01/10)
------------------------------------------------------------------------------------------------------------------------------------
2,600 Total New York 2,663,331
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 1.7%
1,000 North Carolina Eastern Municipal Power Agency, Power System Revenue 1/19 at 100.00 BBB+ 1,046,740
Bonds, Series 2008C, 6.750%, 1/01/24
2,195 North Carolina Eastern Municipal Power Agency, Power System Revenue 5/09 at 100.00 BBB+ 2,158,475
Refunding Bonds, Series 1993B, 5.500%, 1/01/21
500 Raleigh Durham Airport Authority, North Carolina, Airport Revenue 5/11 at 101.00 Aa3 514,625
Bonds, Series 2001A, 5.250%, 11/01/17 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
3,695 Total North Carolina 3,719,840
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 0.5%
1,500 Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco 6/17 at 100.00 BBB 826,620
Settlement Asset-Backed Revenue Bonds, Senior Lien, Series
2007A-2, 6.000%, 6/01/42
300 Lebanon, Ohio, Electric System Mortgage Revenue Bonds, Series 2001, 12/10 at 101.00 A (4) 326,034
5.500%, 12/01/17 (Pre-refunded 12/01/10) - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
1,800 Total Ohio 1,152,654
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 2.0%
1,000 Norman Regional Hospital Authority, Oklahoma, Hospital Revenue 9/16 at 100.00 BBB- 631,440
Bonds, Series 2005, 5.375%, 9/01/36
4,000 Oklahoma Development Finance Authority, Revenue Bonds, St. John 2/14 at 100.00 A 3,835,640
Health System, Series 2004, 5.000%, 2/15/24
------------------------------------------------------------------------------------------------------------------------------------
5,000 Total Oklahoma 4,467,080
------------------------------------------------------------------------------------------------------------------------------------
22
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 0.8%
$ 500 Pennsylvania Higher Educational Facilities Authority, Revenue Bonds, 7/13 at 100.00 BBB+ $ 413,885
Widener University, Series 2003, 5.250%, 7/15/24
700 Pennsylvania Turnpike Commission, Turnpike Revenue Bonds, Series 12/14 at 100.00 Aa3 711,508
2004A, 5.500%, 12/01/31 - AMBAC Insured
520 Pennsylvania, General Obligation Bonds, Second Series 2001, 5.000%, 9/11 at 101.00 AAA 575,104
9/15/20 (Pre-refunded 9/15/11) - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
1,720 Total Pennsylvania 1,700,497
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 8.4%
1,250 Dorchester County School District 2, South Carolina, Installment 12/14 at 100.00 AA- 1,288,663
Purchase Revenue Bonds, GROWTH, Series 2004, 5.250%, 12/01/20
10,000 Greenville County School District, South Carolina, Installment 12/12 at 101.00 AA (4) 11,735,199
Purchase Revenue Bonds, Series 2002, 5.875%, 12/01/19
(Pre-refunded 12/01/12)
1,500 Lexington County Health Service District, South Carolina, Hospital 11/13 at 100.00 A+ (4) 1,769,280
Revenue Refunding and Improvement Bonds, Series 2003, 6.000%,
11/01/18 (Pre-refunded 11/01/13)
520 South Carolina JOBS Economic Development Authority, Economic 11/12 at 100.00 A3 (4) 596,034
Development Revenue Bonds, Bon Secours Health System Inc., Series
2002A, 5.625%, 11/15/30 (Pre-refunded 11/15/12)
1,980 South Carolina JOBS Economic Development Authority, Economic 11/12 at 100.00 A- 1,735,490
Development Revenue Bonds, Bon Secours Health System Inc., Series
2002B, 5.625%, 11/15/30
1,540 Tobacco Settlement Revenue Management Authority, South Carolina, 5/12 at 100.00 BBB (4) 1,617,493
Tobacco Settlement Asset-Backed Bonds, Series 2001B, 6.000%,
5/15/22 (Pre-refunded 5/15/12)
------------------------------------------------------------------------------------------------------------------------------------
16,790 Total South Carolina 18,742,159
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 7.9%
5,000 Brazos River Harbor Navigation District, Brazoria County, Texas, 5/12 at 101.00 BBB- 4,046,100
Environmental Facilities Revenue Bonds, Dow Chemical Company
Project, Series 2002A-6, 6.250%, 5/15/33 (Mandatory put 5/15/17)
(Alternative Minimum Tax)
1,000 Dallas Area Rapid Transit, Texas, Senior Lien Sales Tax Revenue 12/11 at 100.00 AAA 1,102,230
Bonds, Series 2001, 5.000%, 12/01/31 (Pre-refunded 12/01/11) -
AMBAC Insured
360 Dallas-Fort Worth International Airport Public Facility Corporation, 5/09 at 100.00 AAA 360,101
Texas, Airport Hotel Revenue Bonds, Series 2001, 5.500%, 1/15/20 -
FSA Insured
2,300 Harris County Health Facilities Development Corporation, Texas, 11/13 at 100.00 AA- 2,117,265
Thermal Utility Revenue Bonds, TECO Project, Series 2003, 5.000%,
11/15/30 - MBIA Insured
1,550 Harris County-Houston Sports Authority, Texas, Junior Lien Revenue No Opt. Call AA- 280,163
Bonds, Series 2001H, 0.000%, 11/15/30 - MBIA Insured
3,470 Harris County-Houston Sports Authority, Texas, Senior Lien Revenue 11/30 at 61.17 AA 334,994
Refunding Bonds, Series 2001A, 0.000%, 11/15/38 - MBIA Insured
2,805 Harris County-Houston Sports Authority, Texas, Third Lien Revenue 11/24 at 52.47 AA 337,890
Bonds, Series 2004-A3., 0.000%, 11/15/35 - MBIA Insured
45 Irving Independent School District, Dallas County, Texas, General 2/12 at 100.00 AAA 45,176
Obligation Refunding Bonds, Series 2002A, 5.000%, 2/15/31
3,455 Irving Independent School District, Dallas County, Texas, General 2/12 at 100.00 AAA 3,822,474
Obligation Refunding Bonds, Series 2002A, 5.000%, 2/15/31
(Pre-refunded 2/15/12)
1,780 Leander Independent School District, Williamson and Travis Counties, 8/16 at 35.23 AAA 316,555
Texas, General Obligation Bonds, Series 2007, 0.000%, 8/15/37
23
NXP | Nuveen Select Tax-Free Income Portfolio (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS (continued)
$ 2,000 North Texas Thruway Authority, First Tier System Revenue Refunding 1/25 at 100.00 A2 $ 1,232,940
Bonds, Capital Appreciation Series 2008I, 0.000%, 1/01/43
2,000 Richardson Hospital Authority, Texas, Revenue Bonds, Richardson 12/13 at 100.00 Baa2 1,446,420
Regional Medical Center, Series 2004, 6.000%, 12/01/34
465 San Antonio, Texas, Water System Revenue Refunding Bonds, Series 5/12 at 100.00 AAA 532,574
1992, 6.000%, 5/15/16 (Pre-refunded 5/15/12) - MBIA Insured
1,750 Texas, General Obligation Bonds, Water Financial Assistance Program, 8/13 at 100.00 Aa1 1,470,018
Series 2003A, 5.125%, 8/01/42 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
27,980 Total Texas 17,444,900
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.4%
775 Utah State Building Ownership Authority, Lease Revenue Bonds, State 11/11 at 100.00 AA+ 809,263
Facilities Master Lease Program, Series 2001B, 5.250%, 5/15/24
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.4%
1,500 Fairfax County Economic Development Authority, Virginia, Residential 10/17 at 100.00 N/R 989,430
Care Facilities Mortgage Revenue Bonds, Goodwin House, Inc.,
Series 2007A, 5.125%, 10/01/42
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 7.6%
250 Energy Northwest, Washington, Electric Revenue Refunding Bonds, 7/12 at 100.00 Aaa 271,143
Columbia Generating Station - Nuclear Project 2, Series 2002C,
5.500%, 7/01/17 - MBIA Insured
3,610 Snohomish County Public Utility District 1, Washington, Generation No Opt. Call Aaa 3,917,680
System Revenue Bonds, Series 1989, 6.750%, 1/01/12 (ETM)
9,750 Washington State Healthcare Facilities Authority, Revenue Bonds, 10/11 at 100.00 AA 9,889,619
Sisters of Providence Health System, Series 2001A, 5.125%,
10/01/17 - MBIA Insured
2,245 Washington State Tobacco Settlement Authority, Tobacco Settlement 6/13 at 100.00 BBB 2,045,442
Asset-Backed Revenue Bonds, Series 2002, 6.500%, 6/01/26
2,115 Washington State, Motor Vehicle Fuel Tax General Obligation Bonds, No Opt. Call AA+ 789,403
Series 2003F, 0.000%, 12/01/27 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
17,970 Total Washington 16,913,287
------------------------------------------------------------------------------------------------------------------------------------
WEST VIRGINIA - 0.7%
1,075 Marshall County, West Virginia, Special Obligation Refunding Bonds, 5/09 at 100.00 AAA 1,119,193
Series 1992, 6.500%, 5/15/10 (ETM)
500 West Virginia Hospital Finance Authority, Revenue Bonds, United 6/16 at 100.00 A+ 385,430
Hospital Center Inc. Project, Series 2006A, 4.500%, 6/01/26 -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
1,575 Total West Virginia 1,504,623
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 2.0%
1,005 Badger Tobacco Asset Securitization Corporation, Wisconsin, Tobacco 6/12 at 100.00 BBB 1,087,068
Settlement Asset-Backed Bonds, Series 2002, 6.125%, 6/01/27
1,000 Wisconsin Health and Educational Facilities Authority, Revenue Bonds, 8/13 at 100.00 BBB+ 793,830
Wheaton Franciscan Services Inc., Series 2003A, 5.500%, 8/15/17
2,500 Wisconsin, General Obligation Refunding Bonds, Series 2003-3, 5.000%, 11/13 at 100.00 AA 2,539,775
11/01/26
------------------------------------------------------------------------------------------------------------------------------------
4,505 Total Wisconsin 4,420,673
------------------------------------------------------------------------------------------------------------------------------------
$ 267,645 Total Municipal Bonds (cost $223,579,176) 217,073,910
============------------------------------------------------------------------------------------------------------------------------
24
SHARES DESCRIPTION (1) VALUE
------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - 0.0%
AIRLINES - 0.0%
789 UAL Corporation, (5) $ 3,535
============------------------------------------------------------------------------------------------------------------------------
Total Common Stocks (cost $0) 3,535
----------------------------------------------------------------------------------------------------------------------
Total Long-Term Investments (cost $223,579,176) - 97.7% 217,077,445
----------------------------------------------------------------------------------------------------------------------
PRINCIPAL
AMOUNT (000) DESCRIPTION (1) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 1.1%
$ 2,330 State Street Bank Euro Dollar Time Deposit, 0.010%, 4/01/09 N/A $ 2,329,728
============------------------------------------------------------------------------------------------------------------------------
Total Short-Term Investments (cost $2,329,728) 2,329,728
----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $225,908,904) - 98.8% 219,407,173
----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.2% 2,707,235
----------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 222,114,408
======================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) Optional Call Provisions (not covered by the report of independent
registered public accounting firm): Dates (month and year) and prices of
the earliest optional call or redemption. There may be other call
provisions at varying prices at later dates. Certain mortgage-backed
securities may be subject to periodic principal paydowns.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
The Portfolio of Investments may reflect the ratings on certain bonds
insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as of March 31,
2009. Please see the Portfolio Managers' Commentary for an expanded
discussion of the affect on the Fund of changes to the ratings of certain
bonds in the portfolio resulting from changes to the ratings of the
underlying insurers both during the period and after period end.
(4) Backed by an escrow or trust containing sufficient U.S. Government or U.S.
Government agency securities which ensure the timely payment of principal
and interest. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) On December 9, 2002, UAL Corporation ("UAL"), the holding company of
United Air Lines, Inc. ("United") filed for federal bankruptcy protection.
The Adviser determined that it was likely that United would not remain
current on their interest payment obligations with respect to the bonds
previously held and thus the Fund had stopped accruing interest on its UAL
bonds. On February 1, 2006, UAL emerged from federal bankruptcy with the
acceptance of its reorganization plan by the bankruptcy court. Under the
settlement agreement established to meet UAL's unsecured bond obligations,
the bondholders, including the Fund, received three distributions of UAL
common stock over the subsequent months, and the bankruptcy court
dismissed all unsecured claims of bondholders, including those of the
Fund. On May 5, 2006, the Fund liquidated such UAL common stock holdings.
On September 29, 2006 and May 30, 2007, the Fund received additional
distributions of 1,901 and 617 shares, respectively, of UAL common stock
as a result of its earlier ownership of the UAL bonds. The Fund liquidated
1,901 shares of such UAL common stock holdings on November 15, 2006. The
Fund received an additional distribution of 172 UAL common stock shares on
November 14, 2007. The remaining 789 shares of UAL common stock were still
held by the Fund at March 31, 2009.
N/A Not applicable.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
See accompanying notes to financial statements.
25
NXQ | Nuveen Select Tax-Free Income Portfolio 2
| Portfolio of INVESTMENTS
March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS - 98.6%
ARIZONA - 0.5%
$ 2,000 Salt Verde Financial Corporation, Arizona, Senior Gas Revenue Bonds, No Opt. Call A $ 1,178,140
Series 2007, 5.000%,12/01/37
------------------------------------------------------------------------------------------------------------------------------------
ARKANSAS - 1.4%
1,000 Fort Smith, Arkansas, Water and Sewer Revenue Refunding and 10/11 at 100.00 AAA 1,097,870
Construction Bonds, Series 2002A, 5.000%, 10/01/19 - FSA Insured
2,000 University of Arkansas, Fayetteville, Various Facilities Revenue 12/12 at 100.00 Aa3 1,969,840
Bonds, Series 2002, 5.000%, 12/01/32 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
3,000 Total Arkansas 3,067,710
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 6.7%
1,000 Alameda Corridor Transportation Authority, California, Subordinate 10/17 at 100.00 A 706,940
Lien Revenue Bonds, Series 2004A, 0.000%, 10/01/25 - AMBAC Insured
3,325 California Department of Water Resources, Power Supply Revenue Bonds, 5/12 at 101.00 Aa3 3,618,431
Series 2002A, 6.000%, 5/01/14
500 California State Public Works Board, Lease Revenue Refunding Bonds, 6/09 at 101.00 A- 504,080
Community Colleges Projects, Series 1998A, 5.250%, 12/01/16
2,000 California State Public Works Board, Lease Revenue Refunding Bonds, No Opt. Call Aa2 2,156,380
Various University of California Projects, Series 1993A, 5.500%,
6/01/14
60 California, General Obligation Bonds, Series 1997, 5.000%, 10/01/18 - 5/09 at 100.00 A+ 60,160
AMBAC Insured
2,500 California, General Obligation Bonds, Series 2005, 5.000%, 3/01/31 3/16 at 100.00 A 2,230,775
1,000 Golden State Tobacco Securitization Corporation, California, Enhanced 6/17 at 100.00 BBB 502,730
Tobacco Settlement Asset-Backed Bonds, Series 2007A-1, 5.125%,
6/01/47
3,200 Golden State Tobacco Securitization Corporation, California, Tobacco 6/13 at 100.00 AAA 3,765,632
Settlement Asset-Backed Bonds, Series 2003A-1, 6.750%, 6/01/39
(Pre-refunded 6/01/13)
1,195 Palmdale Elementary School District, Los Angeles County, California, No Opt. Call AAA 365,658
General Obligation Bonds, Series 2003, 0.000%, 8/01/28 - FSA
Insured
1,750 Tobacco Securitization Authority of Northern California, Tobacco 6/15 at 100.00 BBB 945,350
Settlement Asset-Backed Bonds, Series 2005A-1, 5.500%, 6/01/45
------------------------------------------------------------------------------------------------------------------------------------
16,530 Total California 14,856,136
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 10.6%
1,700 Colorado Health Facilities Authority, Revenue Bonds, Catholic Health 3/12 at 100.00 AA (4) 1,878,687
Initiatives, Series 2002A, 5.500%, 3/01/22 (ETM)
1,300 Colorado Health Facilities Authority, Revenue Bonds, Catholic Health 3/12 at 100.00 AA (4) 1,450,527
Initiatives, Series 2002A, 5.500%, 3/01/22 (Pre-refunded 3/01/12)
2,440 Denver City and County, Colorado, Airport System Revenue Bonds, No Opt. Call A+ 2,630,564
Series 1991D, 7.750%, 11/15/13 (Alternative Minimum Tax)
5,000 Denver City and County, Colorado, Airport System Revenue Refunding 11/11 at 100.00 AA- 5,019,648
Bonds, Series 2001A, 5.625%, 11/15/17 - FGIC Insured (Alternative
Minimum Tax)
26
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO (continued)
$ 1,555 Denver City and County, Colorado, Airport System Revenue Refunding 11/11 at 100.00 AA- $ 1,611,384
Bonds, Series 2001, 5.500%, 11/15/16 - FGIC Insured
3,000 Denver Convention Center Hotel Authority, Colorado, Senior Revenue 12/13 at 100.00 N/R (4) 3,382,170
Bonds, Convention Center Hotel, Series 2003A, 5.000%, 12/01/23
(Pre-refunded 12/01/13) - SYNCORA GTY Insured
2,000 Denver Convention Center Hotel Authority, Colorado, Senior Revenue 11/16 at 100.00 BBB- 1,225,420
Bonds, Convention Center Hotel, Series 2006, 4.750%, 12/01/35 -
SYNCORA GTY Insured
E-470 Public Highway Authority, Colorado, Senior Revenue Bonds,
Series 2000B:
5,100 0.000%, 9/01/24 - MBIA Insured No Opt. Call AA- 1,500,165
7,500 0.000%, 9/01/29 - MBIA Insured No Opt. Call AA- 1,352,100
4,000 0.000%, 9/01/33 - MBIA Insured No Opt. Call AA- 507,120
5,000 E-470 Public Highway Authority, Colorado, Senior Revenue Bonds, 9/10 at 31.42 Aaa 1,537,700
Series 2000B, 0.000%, 9/01/28 (Pre-refunded 9/01/10) - MBIA Insured
250 Northwest Parkway Public Highway Authority, Colorado, Revenue Bonds, 6/11 at 102.00 AAA 275,038
Senior Series 2001A, 5.250%, 6/15/41 (Pre-refunded 6/15/11) - FSA
Insured
1,100 University of Colorado Hospital Authority, Revenue Bonds, Series 11/11 at 100.00 A3 (4) 1,219,911
2001A, 5.600%, 11/15/31 (Pre-refunded 11/15/11)
------------------------------------------------------------------------------------------------------------------------------------
39,945 Total Colorado 23,590,434
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 2.4%
1,000 Hillsborough County Industrial Development Authority, Florida, 10/16 at 100.00 A3 743,100
Hospital Revenue Bonds, Tampa General Hospital, Series 2006,
5.250%, 10/01/41
1,500 Jacksonville, Florida, Guaranteed Entitlement Revenue Refunding and 10/12 at 100.00 AA- 1,510,515
Improvement Bonds, Series 2002, 5.000%, 10/01/21 - FGIC Insured
2,500 JEA, Florida, Electric System Revenue Bonds, Series 2006-3A, 5.000%, 4/15 at 100.00 AAA 2,389,550
10/01/41 - FSA Insured
625 Miami-Dade County Expressway Authority, Florida, Toll System Revenue 7/11 at 101.00 A3 608,438
Refunding Bonds, Series 2001, 5.125%, 7/01/29 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
5,625 Total Florida 5,251,603
------------------------------------------------------------------------------------------------------------------------------------
HAWAII - 0.5%
1,100 Hawaii, Certificates of Participation, Kapolei State Office Building, 5/09 at 101.00 A 1,113,299
Series 1998A, 5.000%, 5/01/17 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 14.0%
630 Chicago Metropolitan Housing Development Corporation, Illinois, 7/09 at 100.00 AA 631,266
FHA-Insured Section 8 Assisted Housing Development Revenue
Refunding Bonds, Series 1992, 6.800%, 7/01/17
590 Chicago, Illinois, Motor Fuel Tax Revenue Bonds, Series 2003A, 7/13 at 100.00 AA+ 584,289
5.000%, 1/01/33 - AMBAC Insured
1,665 Chicago, Illinois, Third Lien General Airport Revenue Bonds, O'Hare 1/16 at 100.00 AA- 1,555,227
International Airport, Series 2005A, 5.000%, 1/01/33 - FGIC Insured
600 Illinois Educational Facilities Authority, Student Housing Revenue 5/12 at 101.00 Aaa 690,222
Bonds, Educational Advancement Foundation Fund, University Center
Project, Series 2002, 6.000%, 5/01/22 (Pre-refunded 5/01/12)
1,050 Illinois Finance Authority, Revenue Bonds, Loyola University of 7/17 at 100.00 Aa1 977,382
Chicago, Tender Option Bond Trust 1137, 9.208%, 7/01/46 (IF)
2,185 Illinois Finance Authority, Revenue Bonds, YMCA of Southwest 9/15 at 100.00 Aa3 1,647,097
Illinois, Series 2005, 5.000%, 9/01/31 - RAAI Insured
2,255 Illinois Health Facilities Authority, Revenue Bonds, Lake Forest 7/12 at 100.00 A- 2,263,592
Hospital, Series 2002A, 6.250%, 7/01/22
27
NXQ | Nuveen Select Tax-Free Income Portfolio 2 (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 1,055 Illinois Health Facilities Authority, Revenue Bonds, Loyola 7/11 at 100.00 Baa2 (4) $ 1,154,771
University Health System, Series 2001A, 6.125%, 7/01/31
(Pre-refunded 7/01/11)
1,000 Illinois Housing Development Authority, Housing Finance Bonds, Series 1/15 at 100.00 A+ 890,510
2005E, 4.750%, 7/01/30 - FGIC Insured
5,700 Illinois, Sales Tax Revenue Bonds, First Series 2002, 5.000%, 6/15/22 6/13 at 100.00 AAA 5,951,938
45 Metropolitan Pier and Exposition Authority, Illinois, Revenue Bonds, 6/09 at 100.00 A1 45,113
McCormick Place Expansion Project, Series 1992A, 6.500%, 6/15/22
7,000 Metropolitan Pier and Exposition Authority, Illinois, Revenue 6/12 at 101.00 AAA 7,204,678
Refunding Bonds, McCormick Place Expansion Project, Series 2002B,
5.000%, 6/15/21 - MBIA Insured
5,045 Sauk Village, Illinois, General Obligation Alternate Revenue Source 12/12 at 100.00 A 4,202,889
Bonds, Tax Increment, Series 2002A, 5.000%, 6/01/22 - RAAI Insured
Sauk Village, Illinois, General Obligation Alternate Revenue Source
Bonds, Tax Increment, Series 2002B:
1,060 0.000%, 12/01/17 - RAAI Insured No Opt. Call A 647,395
1,135 0.000%, 12/01/18 - RAAI Insured No Opt. Call A 643,817
1,100 Schaumburg, Illinois, General Obligation Bonds, Series 2004B, 5.250%, 12/14 at 100.00 AA+ 1,108,492
12/01/34 - FGIC Insured
1,000 Yorkville, Illinois, General Obligation Debt Certificates, Series 12/11 at 100.00 BBB+ (4) 1,102,540
2003, 5.000%, 12/15/21 (Pre-refunded 12/15/11) - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
33,115 Total Illinois 31,301,218
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 4.0%
1,000 Franklin Community Multi-School Building Corporation, Marion County, 7/14 at 100.00 A (4) 1,141,350
Indiana, First Mortgage Revenue Bonds, Series 2004, 5.000%,
7/15/22 (Pre-refunded 7/15/14) - FGIC Insured
750 Indiana Health and Educational Facilities Financing Authority, No Opt. Call Aa1 679,763
Revenue Bonds, Ascension Health, Series 2006B-5, 5.000%, 11/15/36
1,000 Indiana Health Facility Financing Authority, Revenue Bonds, Community 3/17 at 100.00 BBB 758,520
Foundation of Northwest Indiana, Series 2007, 5.500%, 3/01/37
835 Indiana Housing Finance Authority, Single Family Mortgage Revenue 7/11 at 100.00 Aaa 810,401
Bonds, Series 2002C-2, 5.250%, 7/01/23 (Alternative Minimum Tax)
4,380 Indiana Municipal Power Agency, Power Supply System Revenue Bonds, 1/12 at 100.00 A+ 4,427,173
Series 2002A, 5.125%, 1/01/21 - AMBAC Insured
290 St. Joseph County Hospital Authority, Indiana, Revenue Bonds, 8/09 at 100.50 AA- 251,706
Memorial Health System, Series 1998A, 4.625%, 8/15/28 - MBIA
Insured
750 West Clark 2000 School Building Corporation, Clark County, Indiana, 1/15 at 100.00 AA+ 780,038
First Mortgage Bonds, Series 2005, 5.000%, 7/15/22 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
9,005 Total Indiana 8,848,951
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 3.5%
1,950 Iowa Finance Authority, Single Family Mortgage Revenue Bonds, Series 7/16 at 100.00 AAA 1,677,624
2007B, 4.800%, 1/01/37 (Alternative Minimum Tax)
1,000 Iowa Tobacco Settlement Authority, Asset Backed Settlement Revenue 6/15 at 100.00 BBB 550,010
Bonds, Series 2005C, 5.375%, 6/01/38
1,000 Iowa Tobacco Settlement Authority, Tobacco Asset-Backed Revenue 6/17 at 100.00 BBB 625,120
Bonds, Series 2005B, 5.600%,6/01/34
Iowa Tobacco Settlement Authority, Tobacco Settlement Asset-Backed
Revenue Bonds, Series 2001B:
1,000 5.300%, 6/01/25 (Pre-refunded 6/01/11) 6/11 at 101.00 AAA 1,076,810
3,500 5.600%, 6/01/35 (Pre-refunded 6/01/11) 6/11 at 101.00 AAA 3,830,295
------------------------------------------------------------------------------------------------------------------------------------
8,450 Total Iowa 7,759,859
------------------------------------------------------------------------------------------------------------------------------------
28
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 0.6%
$ 795 Lawrence, Kansas, Hospital Revenue Bonds, Lawrence Memorial Hospital, 7/16 at 100.00 A3 $ 580,374
Series 2006, 4.875%, 7/01/36
1,000 Salina, Kansas, Hospital Revenue Bonds, Salina Regional Medical 4/13 at 100.00 A1 787,900
Center, Series 2006, 4.500%, 10/01/26
------------------------------------------------------------------------------------------------------------------------------------
1,795 Total Kansas 1,368,274
------------------------------------------------------------------------------------------------------------------------------------
LOUISIANA - 2.5%
2,180 Louisiana Public Facilities Authority, Revenue Bonds, Baton Rouge 7/14 at 100.00 AA- 2,192,731
General Hospital, Series 2004, 5.250%, 7/01/24 - MBIA Insured
3,000 Louisiana Public Facilities Authority, Revenue Bonds, Tulane 7/12 at 100.00 A (4) 3,358,350
University, Series 2002A, 5.125%, 7/01/27 (Pre-refunded 7/01/12) -
AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
5,180 Total Louisiana 5,551,081
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 3.2%
3,000 Massachusetts Health and Educational Facilities Authority, Revenue 10/11 at 101.00 BBB+ 2,468,160
Bonds, Berkshire Health System, Series 2001E, 6.250%, 10/01/31
500 Massachusetts Health and Educational Facilities Authority, Revenue 7/18 at 100.00 A3 393,530
Bonds, CareGroup Inc., Series 2008E-1, 5.000%, 7/01/28
2,565 Massachusetts Turnpike Authority, Metropolitan Highway System Revenue 7/09 at 100.00 AA 2,002,470
Bonds, Senior Series 1997A, 5.000%, 1/01/37 - MBIA Insured
1,270 Massachusetts Water Resources Authority, General Revenue Bonds, No Opt. Call AA (4) 1,438,821
Series 1993C, 5.250%, 12/01/15 - MBIA Insured (ETM)
820 Massachusetts Water Resources Authority, General Revenue Bonds, No Opt. Call AA 923,837
Series 1993C, 5.250%, 12/01/15 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
8,155 Total Massachusetts 7,226,818
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 1.5%
545 Detroit, Michigan, General Obligation Bonds, Series 2003A, 5.250%, 4/13 at 100.00 Baa3 414,909
4/01/19 - SYNCORA GTY Insured
2,900 Michigan State Hospital Finance Authority, Hospital Revenue Refunding 12/12 at 100.00 AA 2,753,956
Bonds, Trinity Health Credit Group, Series 2002C, 5.375%, 12/01/30
250 Royal Oak Hospital Finance Authority, Michigan, Hospital Revenue 9/18 at 100.00 A1 267,615
Bonds, William Beaumont Hospital, Refunding Series 2009V, 8.250%,
9/01/39
------------------------------------------------------------------------------------------------------------------------------------
3,695 Total Michigan 3,436,480
------------------------------------------------------------------------------------------------------------------------------------
MINNESOTA - 0.6%
1,500 Minnesota Housing Finance Agency, Residential Housing Finance Bonds, 7/16 at 100.00 AA+ 1,277,955
Series 2007-I, 4.850%, 7/01/38 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 0.2%
500 Mississippi Development Bank, Revenue Bonds, Mississippi Municipal 3/16 at 100.00 Baa2 460,920
Energy Agency, Mississippi Power, Series 2006A, 5.000%, 3/01/21 -
SYNCORA GTY Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 3.1%
1,500 Clark County, Nevada, General Obligation Bank Bonds, Southern Nevada 6/11 at 100.00 AA+ (4) 1,638,060
Water Authority Loan, Series 2001, 5.300%, 6/01/19 (Pre-refunded
6/01/11) - FGIC Insured
29
NXQ | Nuveen Select Tax-Free Income Portfolio 2 (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEVADA (continued)
Director of Nevada State Department of Business and Industry,
Revenue Bonds, Las Vegas Monorail Project, First Tier, Series 2000:
$ 4,595 0.000%, 1/01/22 - AMBAC Insured No Opt. Call A $ 651,387
13,250 5.375%, 1/01/40 - AMBAC Insured 1/10 at 100.00 A 4,544,088
------------------------------------------------------------------------------------------------------------------------------------
19,345 Total Nevada 6,833,535
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 1.7%
2,500 New Jersey Health Care Facilities Financing Authority, Revenue 7/13 at 100.00 Ba2 1,510,700
Bonds, Somerset Medical Center, Series 2003, 5.500%, 7/01/23
Tobacco Settlement Financing Corporation, New Jersey, Tobacco
Settlement Asset-Backed Bonds, Series 2003:
1,000 6.375%, 6/01/32 (Pre-refunded 6/01/13) 6/13 at 100.00 AAA 1,150,980
1,010 6.250%, 6/01/43 (Pre-refunded 6/01/13) 6/13 at 100.00 AAA 1,193,265
------------------------------------------------------------------------------------------------------------------------------------
4,510 Total New Jersey 3,854,945
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 3.1%
1,000 New Mexico Mortgage Finance Authority, Multifamily Housing Revenue 9/17 at 100.00 AAA 898,880
Bonds, St Anthony, Series 2007A, 5.250%, 9/01/42 (Alternative
Minimum Tax)
University of New Mexico, FHA-Insured Mortgage Hospital Revenue
Bonds, Series 2004:
555 4.625%, 1/01/25 - FSA Insured 7/14 at 100.00 AAA 543,112
660 4.625%, 7/01/25 - FSA Insured 7/14 at 100.00 AAA 645,203
2,000 4.750%, 7/01/27 - FSA Insured 7/14 at 100.00 AAA 1,940,460
3,000 4.750%, 1/01/28 - FSA Insured 7/14 at 100.00 AAA 2,891,520
------------------------------------------------------------------------------------------------------------------------------------
7,215 Total New Mexico 6,919,175
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 3.7%
2,045 Dormitory Authority of the State of New York, Revenue Bonds, Mount 7/10 at 101.00 A3 2,093,364
Sinai NYU Health Obligated Group, Series 2000A, 6.500%, 7/01/17
655 Dormitory Authority of the State of New York, Revenue Bonds, Mount 7/10 at 101.00 A3 (4) 709,588
Sinai NYU Health Obligated Group, Series 2000A, 6.500%, 7/01/17
(Pre-refunded 7/01/10)
705 Dormitory Authority of the State of New York, State Personal Income 8/16 at 100.00 BBB+ 468,860
Tax Revenue Bonds, Tender Option Bond Trust 2846, 10.083%,
2/15/35 (IF)
1,000 New York City Municipal Water Finance Authority, New York, Water and 12/14 at 100.00 AAA 950,510
Sewerage System Revenue Bonds, Series 2008, Trust 1199, 8.696%,
6/15/36 - FSA Insured (IF)
3,000 New York State Tobacco Settlement Financing Corporation, Tobacco 6/11 at 100.00 AA- 3,069,030
Settlement Asset-Backed and State Contingency Contract-Backed
Bonds, Series 2003B-1C, 5.500%, 6/01/16
870 Triborough Bridge and Tunnel Authority, New York, Convention Center No Opt. Call AA- 910,612
Bonds, Series 1990E, 7.250%, 1/01/10
------------------------------------------------------------------------------------------------------------------------------------
8,275 Total New York 8,201,964
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 0.6%
1,155 Charlotte-Mecklenburg Hospital Authority, North Carolina, Healthcare 1/11 at 101.00 AA- 1,073,099
System Revenue Bonds, Carolinas Healthcare System, Series 2001A,
5.000%, 1/15/31
345 Charlotte-Mecklenburg Hospital Authority, North Carolina, Healthcare 1/11 at 101.00 Aa3 (4) 372,900
System Revenue Bonds, Carolinas Healthcare System, Series 2001A,
5.000%, 1/15/31 (Pre-refunded 1/15/11)
------------------------------------------------------------------------------------------------------------------------------------
1,500 Total North Carolina 1,445,999
------------------------------------------------------------------------------------------------------------------------------------
30
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 1.6%
Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco
Settlement Asset-Backed Revenue Bonds, Senior Lien, Series 2007A-2:
$ 55 5.125%, 6/01/24 6/17 at 100.00 BBB $ 39,408
2,000 5.375%, 6/01/24 6/17 at 100.00 BBB 1,475,240
680 5.875%, 6/01/30 6/17 at 100.00 BBB 414,304
775 5.750%, 6/01/34 6/17 at 100.00 BBB 444,060
2,180 5.875%, 6/01/47 6/17 at 100.00 BBB 1,163,597
------------------------------------------------------------------------------------------------------------------------------------
5,690 Total Ohio 3,536,609
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 1.4%
1,000 Norman Regional Hospital Authority, Oklahoma, Hospital Revenue 9/16 at 100.00 BBB- 631,440
Bonds, Series 2005, 5.375%, 9/01/36
3,000 Oklahoma Development Finance Authority, Revenue Bonds, Saint John 2/17 at 100.00 A 2,532,000
Health System, Series 2007, 5.000%, 2/15/42
------------------------------------------------------------------------------------------------------------------------------------
4,000 Total Oklahoma 3,163,440
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 2.5%
1,020 Carlisle Area School District, Cumberland County, Pennsylvania, 9/09 at 100.00 A1 (4) 1,039,666
General Obligation Bonds, Series 2004A, 5.000%, 9/01/20
(Pre-refunded 9/01/09) - FGIC Insured
1,000 Philadelphia Authority for Industrial Development, Pennsylvania, 7/11 at 101.00 AA- 987,850
Airport Revenue Bonds, Philadelphia Airport System Project,
Series 2001A, 5.500%, 7/01/17 - FGIC Insured (Alternative
Minimum Tax)
3,250 Philadelphia School District, Pennsylvania, General Obligation 2/12 at 100.00 AAA 3,634,443
Bonds, Series 2002A, 5.500%, 2/01/31 (Pre-refunded 2/01/12) - FSA
Insured
------------------------------------------------------------------------------------------------------------------------------------
5,270 Total Pennsylvania 5,661,959
------------------------------------------------------------------------------------------------------------------------------------
PUERTO RICO - 1.5%
1,035 Puerto Rico Housing Finance Authority, Capital Fund Program Revenue 12/13 at 100.00 AA+ 1,042,504
Bonds, Series 2003, 5.000%, 12/01/20
1,965 Puerto Rico Housing Finance Authority, Capital Fund Program Revenue 12/12 at 100.00 AAA 2,205,005
Bonds, Series 2003, 5.000%, 12/01/20 (Pre-refunded 12/01/12)
------------------------------------------------------------------------------------------------------------------------------------
3,000 Total Puerto Rico 3,247,509
------------------------------------------------------------------------------------------------------------------------------------
RHODE ISLAND - 1.7%
5,835 Rhode Island Tobacco Settlement Financing Corporation, Tobacco 6/12 at 100.00 BBB 3,766,142
Settlement Asset-Backed Bonds, Series 2002A, 6.250%, 6/01/42
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 5.9%
700 Dorchester County School District 2, South Carolina, Installment 12/14 at 100.00 AA- 721,651
Purchase Revenue Bonds, GROWTH, Series 2004, 5.250%, 12/01/20
620 Florence, South Carolina, Water and Sewerage Revenue Bonds, Series 3/10 at 101.00 A+ 644,912
2000, 5.750%, 3/01/20 - AMBAC Insured
4,000 Greenville County School District, South Carolina, Installment 12/12 at 101.00 AA (4) 4,694,078
Purchase Revenue Bonds, Series 2002, 5.875%, 12/01/19
(Pre-refunded 12/01/12)
2,500 Lexington County Health Service District, South Carolina, Hospital 11/13 at 100.00 A+ (4) 2,948,800
Revenue Refunding and Improvement Bonds, Series 2003, 6.000%,
11/01/18 (Pre-refunded 11/01/13)
Medical University Hospital Authority, South Carolina, FHA-Insured
Mortgage Revenue Bonds, Series 2004A:
500 5.250%, 8/15/20 - MBIA Insured 8/14 at 100.00 AA- 497,135
2,435 5.250%, 2/15/21 - MBIA Insured 8/14 at 100.00 AA- 2,401,884
31
NXQ | Nuveen Select Tax-Free Income Portfolio 2 (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA (continued)
$ 845 Piedmont Municipal Power Agency, South Carolina, Electric Revenue 1/10 at 100.00 AA- $ 748,518
Refunding Bonds, Series 1998A, 4.750%, 1/01/25 - MBIA Insured
475 The College of Charleston, Charleston South Carolina, Academic and 4/14 at 100.00 A2 442,904
Administrative Revenue Bonds, Series 2004B, 5.125%, 4/01/30 -
SYNCORA GTY Insured
------------------------------------------------------------------------------------------------------------------------------------
12,075 Total South Carolina 13,099,882
------------------------------------------------------------------------------------------------------------------------------------
SOUTH DAKOTA - 0.4%
1,000 South Dakota Health and Educational Facilities Authority, Revenue 11/14 at 100.00 AA- 863,400
Bonds, Sioux Valley Hospitals, Series 2004A, 5.250%, 11/01/34
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 12.0%
4,000 Brazos River Harbor Navigation District, Brazoria County, Texas, 5/12 at 101.00 BBB- 3,236,880
Environmental Facilities Revenue Bonds, Dow Chemical Company
Project, Series 2002A-6, 6.250%, 5/15/33 (Mandatory put 5/15/17)
(Alternative Minimum Tax)
1,500 Central Texas Regional Mobility Authority, Travis and Williamson 1/15 at 100.00 AA- 1,050,960
Counties, Toll Road Revenue Bonds, Series 2005, 5.000%, 1/01/45 -
FGIC Insured
1,000 Dallas Area Rapid Transit, Texas, Senior Lien Sales Tax Revenue 12/11 at 100.00 AAA 1,102,230
Bonds, Series 2001, 5.000%, 12/01/31 (Pre-refunded 12/01/11) -
AMBAC Insured
2,500 Harris County Health Facilities Development Corporation, Texas, No Opt. Call AA (4) 2,907,850
Hospital Revenue Bonds, Texas Children's Hospital, Series 1995,
5.500%, 10/01/16 - MBIA Insured (ETM)
3,000 Harris County Health Facilities Development Corporation, Texas, 11/13 at 100.00 AA- 2,761,650
Thermal Utility Revenue Bonds, TECO Project, Series 2003, 5.000%,
11/15/30 - MBIA Insured
6,610 Harris County-Houston Sports Authority, Texas, Junior Lien Revenue 11/31 at 53.78 AA- 472,946
Bonds, Series 2001H, 0.000%, 11/15/41 - MBIA Insured
2,000 Houston, Texas, Subordinate Lien Airport System Revenue Bonds, 7/12 at 100.00 AAA 2,002,440
Series 2002A, 5.625%, 7/01/20 - FSA Insured (Alternative Minimum
Tax)
3,125 Katy Independent School District, Harris, Fort Bend and Waller 2/12 at 100.00 AAA 3,450,813
Counties, Texas, General Obligation Bonds, Series 2002A, 5.000%,
2/15/32 (Pre-refunded 2/15/12)
1,400 Kerrville Health Facilities Development Corporation, Texas, Revenue No Opt. Call BBB- 1,072,484
Bonds, Sid Peterson Memorial Hospital Project, Series 2005,
5.375%, 8/15/35
90 Lewisville Independent School District, Denton County, Texas, 8/11 at 100.00 AAA 93,106
General Obligation Bonds, Series 2004, 5.000%, 8/15/23
910 Lewisville Independent School District, Denton County, Texas, 8/11 at 100.00 AAA 995,222
General Obligation Bonds, Series 2004, 5.000%, 8/15/23
(Pre-refunded 8/15/11)
335 Live Oak, Texas, General Obligation Bonds, Series 2004, 5.250%, 8/14 at 100.00 Baa1 338,122
8/01/20 - MBIA Insured
4,850 Sam Rayburn Municipal Power Agency, Texas, Power Supply System 10/12 at 100.00 A3 4,456,811
Revenue Refunding Bonds, Series 2002A, 5.500%, 10/01/17 - RAAI
Insured
1,000 San Antonio, Texas, Water System Revenue Bonds, Series 2005, 4.750%, 5/15 at 100.00 AA 939,450
5/15/37 - MBIA Insured
500 Texas Water Development Board, Senior Lien State Revolving Fund 7/10 at 100.00 AAA 523,975
Revenue Bonds, Series 2000A, 5.625%, 7/15/13
1,560 Texas, General Obligation Bonds, Water Financial Assistance Program, 8/13 at 100.00 Aa1 1,310,416
Series 2003A, 5.125%, 8/01/42 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
34,380 Total Texas 26,715,355
------------------------------------------------------------------------------------------------------------------------------------
UTAH - 0.7%
1,435 Salt Lake City and Sandy Metropolitan Water District, Utah, Water 7/14 at 100.00 Aa3 1,500,881
Revenue Bonds, Series 2004, 5.000%, 7/01/21 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
32
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
VERMONT - 1.3%
$ 2,895 Vermont Housing Finance Agency, Multifamily Housing Bonds, Series 8/09 at 100.00 AAA $ 2,898,908
1999C, 5.800%, 8/15/16 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
VIRGINIA - 0.6%
1,340 Metropolitan District of Columbia Airports Authority, Virginia, 10/10 at 100.00 AA- 1,191,421
Airport System Revenue Bonds, Series 1998B, 5.000%, 10/01/28 -
MBIA Insured (Alternative Minimum Tax)
250 Norfolk, Virginia, Water Revenue Bonds, Series 1995, 5.750%, 5/09 at 100.00 AA- 250,855
11/01/13 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
1,590 Total Virginia 1,442,276
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 3.1%
6,715 Washington State Healthcare Facilities Authority, Revenue Bonds, 10/11 at 100.00 AA 6,811,157
Sisters of Providence Health System, Series 2001A, 5.125%,
10/01/17 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.5%
1,000 Wisconsin Health and Educational Facilities Authority, Revenue 8/13 at 100.00 BBB+ 773,180
Bonds, Wheaton Franciscan Services Inc., Series 2003A, 5.500%,
8/15/18
2,575 Wisconsin Housing and Economic Development Authority, Home Ownership 3/12 at 100.00 AA 2,636,028
Revenue Bonds, Series 2002G, 4.850%, 9/01/17
------------------------------------------------------------------------------------------------------------------------------------
3,575 Total Wisconsin 3,409,208
------------------------------------------------------------------------------------------------------------------------------------
$ 267,900 Total Municipal Bonds (cost $241,815,191) 219,661,222
============------------------------------------------------------------------------------------------------------------------------
SHARES DESCRIPTION (1) VALUE
------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - 0.0%
AIRLINES - 0.0%
757 UAL Corporation, (5) $ 3,391
============------------------------------------------------------------------------------------------------------------------------
Total Common Stocks (cost $0) 3,391
----------------------------------------------------------------------------------------------------------------------
Total Long-Term Investments (cost $241,815,191) - 98.6% 219,664,613
----------------------------------------------------------------------------------------------------------------------
33
NXQ | Nuveen Select Tax-Free Income Portfolio 2 (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL
AMOUNT (000) DESCRIPTION (1) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.2%
$ 386 State Street Bank Euro Dollar Time Deposit, 0.010%, 4/01/09 N/A $ 385,936
============------------------------------------------------------------------------------------------------------------------------
Total Short-Term Investments (cost $385,936) 385,936
----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $242,201,127) - 98.8% 220,050,549
----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.2% 2,720,629
----------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 222,771,178
======================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) Optional Call Provisions (not covered by the report of independent
registered public accounting firm): Dates (month and year) and prices of
the earliest optional call or redemption. There may be other call
provisions at varying prices at later dates. Certain mortgage-backed
securities may be subject to periodic principal paydowns.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
The Portfolio of Investments may reflect the ratings on certain bonds
insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as of March 31,
2009. Please see the Portfolio Managers' Commentary for an expanded
discussion of the affect on the Fund of changes to the ratings of certain
bonds in the portfolio resulting from changes to the ratings of the
underlying insurers both during the period and after period end.
(4) Backed by an escrow or trust containing sufficient U.S. Government or U.S.
Government agency securities which ensure the timely payment of principal
and interest. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) On December 9, 2002, UAL Corporation ("UAL"), the holding company of
United Air Lines, Inc. ("United") filed for federal bankruptcy protection.
The Adviser determined that it was likely that United would not remain
current on their interest payment obligations with respect to the bonds
previously held and thus the Fund had stopped accruing interest on its UAL
bonds. On February 1, 2006, UAL emerged from federal bankruptcy with the
acceptance of its reorganization plan by the bankruptcy court. Under the
settlement agreement established to meet UAL's unsecured bond obligations,
the bondholders, including the Fund, received three distributions of UAL
common stock over the subsequent months, and the bankruptcy court
dismissed all unsecured claims of bond-holders, including those of the
Fund. On May 5, 2006, the Fund liquidated such UAL common stock holdings.
On September 29, 2006 and May 30, 2007, the Fund received additional
distributions of 1,825 and 592 shares, respectively, of UAL common stock
as a result of its earlier ownership of the UAL bonds. The Fund liquidated
the 1,825 shares of such UAL common stock holdings on November 15, 2006.
The Fund received an additional distribution of 165 UAL common stock
shares on November 14, 2007. The remaining 757 shares of UAL common stock
were still held by the Fund at March 31, 2009.
N/A Not applicable.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
See accompanying notes to financial statements.
34
NXR | Nuveen Select Tax-Free Income Portfolio 3
| Portfolio of INVESTMENTS
March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
MUNICIPAL BONDS - 98.7%
ALABAMA - 0.3%
$ 500 Marshall County Healthcare Authority, Alabama, Revenue Bonds, Series 1/12 at 101.00 A- $ 499,290
2002A, 6.250%, 1/01/22
------------------------------------------------------------------------------------------------------------------------------------
CALIFORNIA - 9.1%
2,105 Azusa Unified School District, Los Angeles County, California, 7/12 at 100.00 AAA 2,240,057
General Obligation Bonds, Series 2002, 5.375%, 7/01/21 - FSA
Insured
1,000 California County Tobacco Securitization Agency, Tobacco Settlement 12/18 at 100.00 Baa3 487,900
Asset-Backed Bonds, Los Angeles County Securitization Corporation,
Series 2006A, 0.000%, 6/01/36
1,000 California County Tobacco Securitization Agency, Tobacco Settlement 6/15 at 100.00 BBB 630,330
Asset-Backed Bonds, Sonoma County Tobacco Securitization
Corporation, Series 2005, 5.000%, 6/01/26
3,350 California Department of Water Resources, Power Supply Revenue Bonds, 5/12 at 101.00 Aa3 3,645,638
Series 2002A, 6.000%, 5/01/14
2,595 California Health Facilities Financing Authority, Revenue Bonds, 4/16 at 100.00 A+ 2,110,254
Kaiser Permanante System, Series 2006, 5.000%, 4/01/37
1,000 California Statewide Community Development Authority, Revenue Bonds, 8/19 at 100.00 AA 1,013,600
Methodist Hospital Project, Series 2009, 6.750%, 2/01/38
315 California Statewide Financing Authority, Tobacco Settlement No Opt. Call Baa3 230,366
Asset-Backed Bonds, Pooled Tobacco Securitization Program, Series
2002A, 5.625%, 5/01/29
Golden State Tobacco Securitization Corporation, California, Enhanced
Tobacco Settlement Asset-Backed Bonds, Series 2007A-1:
840 4.500%, 6/01/27 6/17 at 100.00 BBB 621,835
1,000 5.000%, 6/01/33 6/17 at 100.00 BBB 578,920
3,000 Golden State Tobacco Securitization Corporation, California, Tobacco 6/13 at 100.00 AAA 3,530,280
Settlement Asset-Backed Bonds, Series 2003A-1, 6.750%, 6/01/39
(Pre-refunded 6/01/13)
3,640 Rancho Mirage Redevelopment Agency, California, Tax Allocation Bonds, No Opt. Call AA- 513,022
Combined Whitewater and 1984 Project Areas, Series 2003A, 0.000%,
4/01/35 - MBIA Insured
250 Santa Ana Unified School District, Orange County, California, General 8/10 at 101.00 AA- 255,843
Obligation Bonds, Series 2000, 5.700%, 8/01/29 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
20,095 Total California 15,858,045
------------------------------------------------------------------------------------------------------------------------------------
COLORADO - 7.0%
1,540 Arkansas River Power Authority, Colorado, Power Revenue Bonds, Series 10/16 at 100.00 BBB 1,157,834
2006, 5.250%, 10/01/40 - SYNCORA GTY Insured
400 Colorado Department of Transportation, Certificates of Participation, 6/14 at 100.00 AA- 393,772
Series 2004, 5.000%, 6/15/34 - MBIA Insured
2,265 Colorado Health Facilities Authority, Revenue Bonds, Catholic Health 3/12 at 100.00 AA (4) 2,503,074
Initiatives, Series 2002A, 5.500%, 3/01/22 (ETM)
1,735 Colorado Health Facilities Authority, Revenue Bonds, Catholic Health 3/12 at 100.00 AA (4) 1,935,896
Initiatives, Series 2002A, 5.500%, 3/01/22 (Pre-refunded 3/01/12)
2,065 Denver City and County, Colorado, Airport System Revenue Bonds, No Opt. Call A+ 2,226,277
Series 1991D, 7.750%, 11/15/13 (Alternative Minimum Tax)
3,000 Denver Convention Center Hotel Authority, Colorado, Senior Revenue 12/13 at 100.00 N/R (4) 3,382,170
Bonds, Convention Center Hotel, Series 2003A, 5.000%, 12/01/24
(Pre-refunded 12/01/13) - SYNCORA GTY Insured
35
NXR | Nuveen Select Tax-Free Income Portfolio 3 (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
COLORADO (continued)
$ 2,485 E-470 Public Highway Authority, Colorado, Toll Revenue Bonds, Series 9/20 at 63.98 AA- $ 491,757
2004B, 0.000%, 9/01/28 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
13,490 Total Colorado 12,090,780
------------------------------------------------------------------------------------------------------------------------------------
CONNECTICUT - 0.1%
250 Connecticut Health and Educational Facilities Authority, Revenue 7/09 at 100.00 AA- 251,133
Bonds, Bridgeport Hospital Issue, Series 1992A, 6.625%, 7/01/18 -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
DISTRICT OF COLUMBIA - 0.3%
405 District of Columbia Tobacco Settlement Corporation, Tobacco 5/11 at 101.00 BBB 343,728
Settlement Asset-Backed Bonds, Series 2001, 6.250%, 5/15/24
15 District of Columbia, General Obligation Bonds, Series 1993E, 5/09 at 100.00 AAA 15,057
6.000%, 6/01/13 - MBIA Insured (ETM)
235 District of Columbia, General Obligation Refunding Bonds, Series No Opt. Call AA- 247,486
1994A-1, 6.500%, 6/01/10 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
655 Total District of Columbia 606,271
------------------------------------------------------------------------------------------------------------------------------------
FLORIDA - 5.6%
1,000 Hillsborough County Industrial Development Authority, Florida, 10/16 at 100.00 A3 743,100
Hospital Revenue Bonds, Tampa General Hospital, Series 2006,
5.250%, 10/01/41
5,020 JEA St. John's River Power Park System, Florida, Revenue Refunding 10/11 at 100.00 Aa2 5,127,527
Bonds, Issue 2, Series 2002-17, 5.000%, 10/01/18
4,000 JEA, Florida, Subordinate Lien Electric System Revenue Bonds, Series 5/09 at 100.00 Aa3 3,929,080
2002D, 4.625%, 10/01/22
------------------------------------------------------------------------------------------------------------------------------------
10,020 Total Florida 9,799,707
------------------------------------------------------------------------------------------------------------------------------------
GEORGIA - 0.2%
265 Atlanta, Georgia, Airport Facilities Revenue Bonds, Series 1990, No Opt. Call AA 256,414
0.000%, 1/01/10 - MBIA Insured (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS - 19.0%
105 Chicago Metropolitan Housing Development Corporation, Illinois, 7/09 at 100.00 AA 105,138
FHA-Insured Section 8 Assisted Housing Development Revenue
Refunding Bonds, Series 1992, 6.850%, 7/01/22
1,930 Illinois Development Finance Authority, Revenue Bonds, Midwestern 5/11 at 101.00 AAA 2,124,505
University, Series 2001B, 5.750%, 5/15/16 (Pre-refunded 5/15/11)
1,050 Illinois Finance Authority, Revenue Bonds, Loyola University of 7/17 at 100.00 Aa1 977,382
Chicago, Tender Option Bond Trust 1137, 9.208%, 7/01/46 (IF)
2,185 Illinois Finance Authority, Revenue Bonds, YMCA of Southwest 9/15 at 100.00 Aa3 1,647,097
Illinois, Series 2005, 5.000%, 9/01/31 - RAAI Insured
4,445 Illinois Health Facilities Authority, Remarketed Revenue Bonds, 8/11 at 103.00 Aa1 4,544,478
University of Chicago Project, Series 1985A, 5.500%, 8/01/20
1,500 Illinois Health Facilities Authority, Revenue Bonds, Evangelical No Opt. Call N/R (4) 1,810,830
Hospitals Corporation, Series 1992C, 6.250%, 4/15/22 (ETM)
2,225 Illinois Health Facilities Authority, Revenue Refunding Bonds, 1/13 at 100.00 Baa1 2,230,251
Elmhurst Memorial Healthcare, Series 2002, 6.250%, 1/01/17
205 Illinois Health Facilities Authority, Revenue Refunding Bonds, 5/09 at 100.00 Baa1 177,856
Rockford Health System, Series 1997, 5.000%, 8/15/21 - AMBAC
Insured
2,500 Illinois Housing Development Authority, Homeowner Mortgage Revenue 2/16 at 100.00 AA 2,309,775
Bonds, Series 2006C2, 5.050%, 8/01/27 (Alternative Minimum Tax)
5,700 Illinois, Sales Tax Revenue Bonds, First Series 2002, 5.000%, 6/15/22 6/13 at 100.00 AAA 5,951,939
2,000 Illinois, Sales Tax Revenue Bonds, Series 1997X, 5.600%, 6/15/17 6/09 at 100.00 AAA 2,015,460
1,000 Kankakee & Will Counties Community Unit School District 5, Illinois, No Opt. Call Aa3 485,310
General Obligation Bonds, Series 2006, 0.000%, 5/01/23 - FSA
Insured
36
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
ILLINOIS (continued)
$ 6,000 Metropolitan Pier and Exposition Authority, Illinois, Revenue 6/12 at 101.00 AAA $ 6,175,435
Refunding Bonds, McCormick Place Expansion Project, Series 2002B,
5.000%, 6/15/21 - MBIA Insured
1,300 Schaumburg, Illinois, General Obligation Bonds, Series 2004B, 12/14 at 100.00 AA+ 1,310,036
5.250%, 12/01/34 - FGIC Insured
1,000 Yorkville, Illinois, General Obligation Debt Certificates, Series 12/11 at 100.00 BBB+ (4) 1,102,540
2003, 5.000%, 12/15/22 (Pre-refunded 12/15/11) - RAAI Insured
------------------------------------------------------------------------------------------------------------------------------------
33,145 Total Illinois 32,968,032
------------------------------------------------------------------------------------------------------------------------------------
INDIANA - 6.5%
1,000 Franklin Community Multi-School Building Corporation, Marion County, 7/14 at 100.00 A (4) 1,141,350
Indiana, First Mortgage Revenue Bonds, Series 2004, 5.000%,
7/15/22 (Pre-refunded 7/15/14) - FGIC Insured
3,500 Indiana Health Facility Financing Authority, Hospital Revenue Bonds, 9/11 at 100.00 BBB 2,834,265
Methodist Hospitals Inc., Series 2001, 5.375%, 9/15/22
2,500 Indiana Health Facility Financing Authority, Hospital Revenue No Opt. Call AAA 2,856,725
Refunding Bonds, Columbus Regional Hospital, Series 1993, 7.000%,
8/15/15 - FSA Insured
2,000 Indianapolis Local Public Improvement Bond Bank, Indiana, Waterworks 7/12 at 100.00 AAA 2,252,260
Project, Series 2002A, 5.250%, 7/01/33 (Pre-refunded 7/01/12) -
MBIA Insured
2,295 Shelbyville Central Renovation School Building Corporation, Indiana, 7/15 at 100.00 AA+ 2,231,750
First Mortgage Bonds, Series 2005, 4.375%, 7/15/25 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
11,295 Total Indiana 11,316,350
------------------------------------------------------------------------------------------------------------------------------------
IOWA - 5.6%
2,745 Iowa Finance Authority, Health Facility Revenue Bonds, Care 7/16 at 100.00 BB+ 2,025,892
Initiatives Project, Series 2006A, 5.000%, 7/01/20
750 Iowa Tobacco Settlement Authority, Tobacco Asset-Backed Revenue 6/17 at 100.00 BBB 468,840
Bonds, Series 2005B, 5.600%, 6/01/34
Iowa Tobacco Settlement Authority, Tobacco Settlement Asset-Backed
Revenue Bonds, Series 2001B:
3,850 5.300%, 6/01/25 (Pre-refunded 6/01/11) 6/11 at 101.00 AAA 4,145,719
2,850 5.600%, 6/01/35 (Pre-refunded 6/01/11) 6/11 at 101.00 AAA 3,118,955
------------------------------------------------------------------------------------------------------------------------------------
10,195 Total Iowa 9,759,406
------------------------------------------------------------------------------------------------------------------------------------
KANSAS - 1.0%
Lawrence, Kansas, Hospital Revenue Bonds, Lawrence Memorial
Hospital, Series 2006:
1,425 5.125%, 7/01/26 7/16 at 100.00 A3 1,220,114
700 4.875%, 7/01/36 7/16 at 100.00 A3 511,021
------------------------------------------------------------------------------------------------------------------------------------
2,125 Total Kansas 1,731,135
------------------------------------------------------------------------------------------------------------------------------------
MAINE - 0.7%
125 Maine Health and Higher Educational Facilities Authority, Revenue 7/09 at 101.00 Aaa 127,526
Bonds, Series 1999B, 6.000%, 7/01/19 - MBIA Insured
1,075 Maine Health and Higher Educational Facilities Authority, Revenue 7/09 at 101.00 Aaa 1,099,822
Bonds, Series 1999B, 6.000%, 7/01/19 (Pre-refunded 7/01/09) -
MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
1,200 Total Maine 1,227,348
------------------------------------------------------------------------------------------------------------------------------------
MASSACHUSETTS - 0.8%
1,000 Massachusetts Development Finance Agency, Resource Recovery Revenue 6/09 at 102.00 BBB 889,200
Bonds, Ogden Haverhill Associates, Series 1998B, 5.200%, 12/01/13
(Alternative Minimum Tax)
15 Massachusetts Health and Educational Facilities Authority, Revenue 7/11 at 101.00 AA 16,171
Bonds, Partners Health Care System Inc., Series 2001C, 6.000%,
7/01/17
485 Massachusetts Health and Educational Facilities Authority, Revenue 7/11 at 101.00 AAA 541,527
Bonds, Partners Health Care System Inc., Series 2001C, 6.000%,
7/01/17 (Pre-refunded 7/01/11)
------------------------------------------------------------------------------------------------------------------------------------
1,500 Total Massachusetts 1,446,898
------------------------------------------------------------------------------------------------------------------------------------
37
NXR | Nuveen Select Tax-Free Income Portfolio 3 (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
MICHIGAN - 2.5%
$ 1,500 Detroit, Michigan, Sewer Disposal System Revenue Bonds, Second Lien, 7/16 at 100.00 AA- $ 1,129,920
Series 2006B, 4.625%, 7/01/34 - FGIC Insured
2,900 Michigan State Hospital Finance Authority, Hospital Revenue 12/12 at 100.00 AA 2,753,956
Refunding Bonds, Trinity Health Credit Group, Series 2002C,
5.375%, 12/01/30
235 Michigan State Hospital Finance Authority, Revenue Refunding Bonds, 8/09 at 100.00 BB 197,835
Detroit Medical Center Obligated Group, Series 1993A, 6.500%,
8/15/18
250 Royal Oak Hospital Finance Authority, Michigan, Hospital Revenue 9/18 at 100.00 A1 267,615
Bonds, William Beaumont Hospital, Refunding Series 2009V, 8.250%,
9/01/39
------------------------------------------------------------------------------------------------------------------------------------
4,885 Total Michigan 4,349,326
------------------------------------------------------------------------------------------------------------------------------------
MISSISSIPPI - 0.4%
725 Mississippi Hospital Equipment and Facilities Authority, Revenue 9/14 at 100.00 AA 700,401
Bonds, Baptist Memorial Healthcare, Series 2004B-1, 5.000%,
9/01/24
------------------------------------------------------------------------------------------------------------------------------------
NEBRASKA - 1.9%
3,500 Nebraska Public Power District, General Revenue Bonds, Series 2002B, 1/13 at 100.00 A1 3,354,225
5.000%, 1/01/33 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
NEVADA - 3.6%
4,095 Director of Nevada State Department of Business and Industry, 1/10 at 100.00 A 1,404,380
Revenue Bonds, Las Vegas Monorail Project, First Tier, Series
2000, 5.375%, 1/01/40 - AMBAC Insured
1,680 Reno, Nevada, Capital Improvement Revenue Bonds, Series 2002, 6/12 at 100.00 Baa1 1,594,757
5.500%, 6/01/22 - FGIC Insured
2,830 Reno, Nevada, Capital Improvement Revenue Bonds, Series 2002, 6/12 at 100.00 Baa1 (4) 3,194,221
5.500%, 6/01/22 (Pre-refunded 6/01/12) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
8,605 Total Nevada 6,193,358
------------------------------------------------------------------------------------------------------------------------------------
NEW HAMPSHIRE - 0.3%
480 New Hampshire Housing Finance Authority, Single Family Mortgage 5/11 at 100.00 Aa2 474,221
Acquisition Bonds, Series 2001A, 5.600%, 7/01/21 (Alternative
Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
NEW JERSEY - 1.6%
Tobacco Settlement Financing Corporation, New Jersey, Tobacco
Settlement Asset-Backed Bonds, Series 2003:
1,000 6.750%, 6/01/39 (Pre-refunded 6/01/13) 6/13 at 100.00 AAA 1,201,470
1,355 6.250%, 6/01/43 (Pre-refunded 6/01/13) 6/13 at 100.00 AAA 1,600,865
------------------------------------------------------------------------------------------------------------------------------------
2,355 Total New Jersey 2,802,335
------------------------------------------------------------------------------------------------------------------------------------
NEW MEXICO - 2.8%
1,000 New Mexico Mortgage Finance Authority, Multifamily Housing Revenue 9/17 at 100.00 AAA 898,880
Bonds, St Anthony, Series 2007A, 5.250%, 9/01/42 (Alternative
Minimum Tax)
4,000 University of New Mexico, FHA-Insured Mortgage Hospital Revenue 7/14 at 100.00 AAA 3,914,320
Bonds, Series 2004, 4.625%, 1/01/25 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
5,000 Total New Mexico 4,813,200
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK - 3.2%
815 Dormitory Authority of the State of New York, Second General No Opt. Call A1 842,979
Resolution Consolidated Revenue Bonds, City University System,
Series 1990C, 7.500%, 7/01/10
420 Dormitory Authority of the State of New York, State Personal Income 8/16 at 100.00 BBB+ 279,321
Tax Revenue Bonds, Tender Option Bond Trust 2846, 10.083%,
2/15/35 (IF)
2,335 Long Island Power Authority, New York, Electric System General 9/11 at 100.00 AAA 2,579,008
Revenue Bonds, Series 2001A, 5.375%, 9/01/21 (Pre-refunded
9/01/11)
35 New York City, New York, General Obligation Bonds, Series 1991B, 5/09 at 100.00 AA 35,156
7.000%, 2/01/18
38
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK (continued)
$ 1,850 New York State Tobacco Settlement Financing Corporation, Tobacco 6/10 at 100.00 AA- $ 1,878,120
Settlement Asset-Backed and State Contingency Contract-Backed
Bonds, Series 2003B-1C, 5.500%, 6/01/15
------------------------------------------------------------------------------------------------------------------------------------
5,455 Total New York 5,614,584
------------------------------------------------------------------------------------------------------------------------------------
NORTH CAROLINA - 4.4%
5,000 North Carolina Municipal Power Agency 1, Catawba Electric Revenue 1/13 at 100.00 AA- 5,101,799
Bonds, Series 2003A, 5.250%, 1/01/18 - MBIA Insured
2,345 Piedmont Triad Airport Authority, North Carolina, Airport Revenue 7/11 at 101.00 AAA 2,507,579
Bonds, Series 2001A, 5.250%, 7/01/16 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
7,345 Total North Carolina 7,609,378
------------------------------------------------------------------------------------------------------------------------------------
OHIO - 0.9%
Buckeye Tobacco Settlement Financing Authority, Ohio, Tobacco
Settlement Asset-Backed Revenue Bonds, Senior Lien, Series 2007A-2:
1,455 5.375%, 6/01/24 6/17 at 100.00 BBB 1,073,237
1,000 6.000%, 6/01/42 6/17 at 100.00 BBB 551,080
------------------------------------------------------------------------------------------------------------------------------------
2,455 Total Ohio 1,624,317
------------------------------------------------------------------------------------------------------------------------------------
OKLAHOMA - 1.7%
3,000 Oklahoma Development Finance Authority, Revenue Bonds, St. John 2/14 at 100.00 A 2,876,730
Health System, Series 2004, 5.000%, 2/15/24
------------------------------------------------------------------------------------------------------------------------------------
PENNSYLVANIA - 2.3%
2,435 Dauphin County Industrial Development Authority, Pennsylvania, Water No Opt. Call A- 2,588,722
Development Revenue Refunding Bonds, Dauphin Consolidated Water
Supply Company, Series 1992B, 6.700%, 6/01/17
500 Pennsylvania Higher Educational Facilities Authority, Revenue Bonds, 7/13 at 100.00 BBB+ 413,885
Widener University, Series 2003, 5.250%, 7/15/24
1,000 Philadelphia Authority for Industrial Development, Pennsylvania, 7/11 at 101.00 AA- 987,850
Airport Revenue Bonds, Philadelphia Airport System Project,
Series 2001A, 5.500%, 7/01/17 - FGIC Insured (Alternative Minimum
Tax)
------------------------------------------------------------------------------------------------------------------------------------
3,935 Total Pennsylvania 3,990,457
------------------------------------------------------------------------------------------------------------------------------------
SOUTH CAROLINA - 3.2%
1,500 Lexington County Health Service District, South Carolina, Hospital 11/13 at 100.00 A+ (4) 1,769,280
Revenue Refunding and Improvement Bonds, Series 2003, 6.000%,
11/01/18 (Pre-refunded 11/01/13)
1,500 Medical University Hospital Authority, South Carolina, FHA-Insured 8/14 at 100.00 AA- 1,491,405
Mortgage Revenue Bonds, Series 2004A, 5.250%, 8/15/20 - MBIA
Insured
520 South Carolina JOBS Economic Development Authority, Economic 11/12 at 100.00 A3 (4) 596,034
Development Revenue Bonds, Bon Secours Health System Inc., Series
2002A, 5.625%, 11/15/30 (Pre-refunded 11/15/12)
1,980 South Carolina JOBS Economic Development Authority, Economic 11/12 at 100.00 A- 1,735,490
Development Revenue Bonds, Bon Secours Health System Inc., Series
2002B, 5.625%, 11/15/30
------------------------------------------------------------------------------------------------------------------------------------
5,500 Total South Carolina 5,592,209
------------------------------------------------------------------------------------------------------------------------------------
SOUTH DAKOTA - 1.0%
1,010 South Dakota Health and Educational Facilities Authority, Revenue 7/12 at 101.00 A+ 846,592
Bonds, Avera Health, Series 2002, 5.125%, 7/01/27 - AMBAC Insured
1,000 South Dakota Health and Educational Facilities Authority, Revenue 11/14 at 100.00 AA- 863,400
Bonds, Sioux Valley Hospitals, Series 2004A, 5.250%, 11/01/34
------------------------------------------------------------------------------------------------------------------------------------
2,010 Total South Dakota 1,709,992
------------------------------------------------------------------------------------------------------------------------------------
TENNESSEE - 1.2%
2,000 Knox County Health, Educational and Housing Facilities Board, 4/12 at 101.00 A1 2,016,880
Tennessee, Hospital Revenue Bonds, Baptist Health System of East
Tennessee Inc., Series 2002, 6.375%, 4/15/22
------------------------------------------------------------------------------------------------------------------------------------
39
NXR | Nuveen Select Tax-Free Income Portfolio 3 (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TEXAS - 9.7%
$ 1,500 Central Texas Regional Mobility Authority, Travis and Williamson 1/15 at 100.00 AA- $ 1,050,960
Counties, Toll Road Revenue Bonds, Series 2005, 5.000%, 1/01/45 -
FGIC Insured
2,500 Harris County Health Facilities Development Corporation, Texas, 11/13 at 100.00 AA- 2,301,375
Thermal Utility Revenue Bonds, TECO Project, Series 2003, 5.000%,
11/15/30 - MBIA Insured
4,005 Harris County-Houston Sports Authority, Texas, Senior Lien Revenue 11/30 at 61.17 AA 386,643
Refunding Bonds, Series 2001A, 0.000%, 11/15/38 - MBIA Insured
3,000 Houston, Texas, Subordinate Lien Airport System Revenue Bonds, 7/12 at 100.00 AAA 3,247,860
Series 2002B, 5.500%, 7/01/18 - FSA Insured
3,125 Katy Independent School District, Harris, Fort Bend and Waller 2/12 at 100.00 AAA 3,450,813
Counties, Texas, General Obligation Bonds, Series 2002A, 5.000%,
2/15/32 (Pre-refunded 2/15/12)
4,750 Sam Rayburn Municipal Power Agency, Texas, Power Supply System 10/12 at 100.00 A3 4,364,918
Revenue Refunding Bonds, Series 2002A, 5.500%, 10/01/17 - RAAI
Insured
1,750 Texas, General Obligation Bonds, Water Financial Assistance Program, 8/13 at 100.00 Aa1 1,470,018
Series 2003A, 5.125%, 8/01/42 (Alternative Minimum Tax)
500 Victoria, Texas, General Obligation Bonds, Series 2001, 5.000%, 8/11 at 100.00 AA- 509,565
8/15/23 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
21,130 Total Texas 16,782,152
------------------------------------------------------------------------------------------------------------------------------------
WASHINGTON - 0.3%
510 Port of Seattle, Washington, Revenue Bonds, Series 2001A, 5.000%, 10/11 at 100.00 Aa2 503,304
4/01/31 - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
WISCONSIN - 1.5%
2,500 Wisconsin, General Obligation Refunding Bonds, Series 2003-3, 11/13 at 100.00 AA 2,539,775
5.000%, 11/01/26
------------------------------------------------------------------------------------------------------------------------------------
$ 186,125 Total Municipal Bonds (cost $176,313,479) 171,357,653
============------------------------------------------------------------------------------------------------------------------------
SHARES DESCRIPTION (1) VALUE
------------------------------------------------------------------------------------------------------------------------------------
COMMON STOCKS - 0.0%
AIRLINES - 0.0%
220 UAL Corporation, (5) $ 986
============------------------------------------------------------------------------------------------------------------------------
Total Common Stocks (cost $0) 986
----------------------------------------------------------------------------------------------------------------------
Total Long-Term Investments (cost $176,313,479) - 98.7% 171,358,639
----------------------------------------------------------------------------------------------------------------------
40
PRINCIPAL
AMOUNT (000) DESCRIPTION (1) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.2%
$ 319 State Street Bank Euro Dollar Time Deposit, 0.010%, 4/01/09 N/A $ 318,866
============------------------------------------------------------------------------------------------------------------------------
Total Short-Term Investments (cost $318,866) 318,866
----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $176,632,345) - 98.9% 171,677,505
----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.1% 2,000,052
----------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 173,677,557
======================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) Optional Call Provisions (not covered by the report of independent
registered public accounting firm): Dates (month and year) and prices of
the earliest optional call or redemption. There may be other call
provisions at varying prices at later dates. Certain mortgage-backed
securities may be subject to periodic principal paydowns.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
The Portfolio of Investments may reflect the ratings on certain bonds
insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as of March 31,
2009. Please see the Portfolio Managers' Commentary for an expanded
discussion of the affect on the Fund of changes to the ratings of certain
bonds in the portfolio resulting from changes to the ratings of the
underlying insurers both during the period and after period end.
(4) Backed by an escrow or trust containing sufficient U.S. Government or U.S.
Government agency securities which ensure the timely payment of principal
and interest. Such investments are normally considered to be equivalent to
AAA rated securities.
(5) On December 9, 2002, UAL Corporation ("UAL"), the holding company of
United Air Lines, Inc. ("United") filed for federal bankruptcy protection.
The Adviser determined that it was likely that United would not remain
current on their interest payment obligations with respect to the bonds
previously held and thus the Fund had stopped accruing interest on its UAL
bonds. On February 1, 2006, UAL emerged from federal bankruptcy with the
acceptance of its reorganization plan by the bankruptcy court. Under the
settlement agreement established to meet UAL's unsecured bond obligations,
the bondholders, including the Fund, received three distributions of UAL
common stock over the subsequent months, and the bankruptcy court
dismissed all unsecured claims of bond-holders, including those of the
Fund. On May 5, 2006, the Fund liquidated such UAL common stock holdings.
On September 29, 2006 and May 30, 2007, the Fund received additional
distributions of 532 and 172 shares, respectively, of UAL common stock as
a result of its earlier ownership of the UAL bonds. The Fund liquidated
532 shares of such UAL common stock holdings on November 15, 2006. The
Fund received an additional distribution of 48 UAL common stock shares on
November 14, 2007. The remaining 220 shares of UAL common stock were still
held by the Fund at March 31, 2009.
N/A Not applicable.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
See accompanying notes to financial statements.
41
NXC | Nuveen California Select Tax-Free Income Portfolio
| Portfolio of INVESTMENTS
March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 3.6%
$ 200 California County Tobacco Securitization Agency, Tobacco Settlement 6/15 at 100.00 BBB $ 173,482
Asset-Backed Bonds, Sonoma County Tobacco Securitization
Corporation, Series 2005, 4.250%, 6/01/21
1,365 California County Tobacco Securitization Agency, Tobacco Settlement 6/12 at 100.00 BBB 1,246,750
Asset-Backed Revenue Bonds, Fresno County Tobacco Funding
Corporation, Series 2002, 5.625%, 6/01/23
4,045 Golden State Tobacco Securitization Corporation, California, 6/22 at 100.00 BBB 1,560,237
Enhanced Tobacco Settlement Asset-Backed Bonds, Series 2007A-2,
0.000%, 6/01/37
------------------------------------------------------------------------------------------------------------------------------------
5,610 Total Consumer Staples 2,980,469
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 9.7%
3,000 California Educational Facilities Authority, Revenue Bonds, Santa 4/18 at 100.00 Aa3 3,041,220
Clara University, Series 2008A, 5.625%, 4/01/37
45 California Educational Facilities Authority, Revenue Bonds, 10/15 at 100.00 A3 37,584
University of Redlands, Series 2005A, 5.000%, 10/01/35
1,000 California Educational Facilities Authority, Revenue Bonds, 10/12 at 100.00 A2 990,890
University of San Diego, Series 2002A, 5.500%, 10/01/32
California Educational Facilities Authority, Revenue Bonds,
University of the Pacific, Series 2006:
35 5.000%, 11/01/21 11/15 at 100.00 A2 33,226
45 5.000%, 11/01/25 11/15 at 100.00 A2 39,900
3,000 California Infrastructure Economic Development Bank, Revenue Bonds, 10/11 at 101.00 A- 3,061,590
J. David Gladstone Institutes, Series 2001, 5.500%, 10/01/19
1,000 Long Beach Bond Financing Authority, California, Lease Revenue 11/11 at 101.00 A 801,850
Refunding Bonds, Long Beach Aquarium of the South Pacific, Series
2001, 5.250%, 11/01/30 - AMBAC Insured
------------------------------------------------------------------------------------------------------------------------------------
8,125 Total Education and Civic Organizations 8,006,260
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 10.1%
110 California Health Facilities Financing Authority, Revenue Bonds, 4/16 at 100.00 A+ 89,452
Kaiser Permanante System, Series 2006, 5.000%, 4/01/37
965 California Health Facilities Financing Authority, Revenue Bonds, 11/16 at 100.00 AA- 696,604
Sutter Health, Series 2008, Trust 3146, 12.579%, 11/15/46 (IF)
2,000 California Infrastructure Economic Development Bank, Revenue Bonds, 8/11 at 102.00 A+ 1,804,720
Kaiser Hospital Assistance LLC, Series 2001A, 5.550%, 8/01/31
1,500 California Statewide Community Development Authority, Hospital 6/13 at 100.00 AAA 1,589,475
Revenue Bonds, Monterey Peninsula Hospital, Series 2003B, 5.250%,
6/01/18 - FSA Insured
1,500 California Statewide Community Development Authority, Insured 11/09 at 102.00 A+ 1,373,040
Mortgage Hospital Revenue Bonds, Mission Community Hospital,
Series 2001, 5.375%, 11/01/26
545 California Statewide Community Development Authority, Revenue Bonds, 8/16 at 100.00 A+ 475,082
Kaiser Permanente System, Series 2001C, 5.250%, 8/01/31
1,880 California Statewide Community Development Authority, Revenue Bonds, 6/09 at 100.00 A 1,843,190
Los Angeles Orthopedic Hospital Foundation, Series 2000, 5.500%,
6/01/17 - AMBAC Insured
540 Loma Linda, California, Hospital Revenue Bonds, Loma Linda 12/18 at 100.00 BBB 530,226
University Medical Center, Series 2008A, 8.250%, 12/01/38
------------------------------------------------------------------------------------------------------------------------------------
9,040 Total Health Care 8,401,789
------------------------------------------------------------------------------------------------------------------------------------
42
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 0.8%
$ 750 California Statewide Community Development Authority, Student 8/12 at 100.00 Baa1 $ 654,308
Housing Revenue Bonds, EAH - Irvine East Campus Apartments, LLC
Project, Series 2002A, 5.500%, 8/01/22 - ACA Insured
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 0.1%
115 California Housing Finance Agency, Home Mortgage Revenue Bonds, 2/16 at 100.00 Aa2 112,939
Series 2006H, 5.750%, 8/01/30 - FGIC Insured (Alternative Minimum
Tax)
------------------------------------------------------------------------------------------------------------------------------------
INDUSTRIALS - 1.8%
1,250 California Pollution Control Financing Authority, Solid Waste No Opt. Call BBB 1,106,538
Disposal Revenue Bonds, Republic Services Inc., Series 2002C,
5.250%, 6/01/23 (Mandatory put 12/01/17) (Alternative Minimum Tax)
500 California Pollution Control Financing Authority, Solid Waste 1/16 at 102.00 BBB 410,440
Disposal Revenue Bonds, Waste Management Inc., Series 2002A,
5.000%, 1/01/22 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,750 Total Industrials 1,516,978
------------------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 2.6%
1,500 ABAG Finance Authority for Non-Profit Corporations, California, 11/12 at 100.00 A+ 1,412,970
Insured Senior Living Revenue Bonds, Odd Fellows Home of
California, Series 2003A, 5.200%, 11/15/22
1,000 California Statewide Communities Development Authority, Revenue 12/17 at 100.00 Baa1 758,960
Bonds, Inland Regional Center Project, Series 2007, 5.250%,
12/01/27
------------------------------------------------------------------------------------------------------------------------------------
2,500 Total Long-Term Care 2,171,930
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 22.3%
750 California, General Obligation Bonds, Series 2004, 5.000%, 2/01/23 2/14 at 100.00 A 730,020
1,000 Fremont Unified School District, Alameda County, California, General 8/12 at 101.00 AA- 1,026,550
Obligation Bonds, Series 2002A, 5.000%, 8/01/21 - FGIC Insured
Golden West Schools Financing Authority, California, General
Obligation Revenue Refunding Bonds, School District Program,
Series 1999A:
4,650 0.000%, 8/01/16 - MBIA Insured No Opt. Call AA- 3,410,124
1,750 0.000%, 2/01/17 - MBIA Insured No Opt. Call AA- 1,235,028
2,375 0.000%, 8/01/17 - MBIA Insured No Opt. Call AA- 1,631,910
2,345 0.000%, 2/01/18 - MBIA Insured No Opt. Call AA- 1,551,804
Mountain View-Los Altos Union High School District, Santa Clara
County, California, General Obligation Capital Appreciation
Bonds, Series 1995C:
1,015 0.000%, 5/01/17 - MBIA Insured No Opt. Call Aa2 706,887
1,080 0.000%, 5/01/18 - MBIA Insured No Opt. Call Aa2 704,884
100 Roseville Joint Union High School District, Placer County, 8/15 at 100.00 AA- 97,995
California, General Obligation Bonds, Series 2006B, 5.000%,
8/01/27 - FGIC Insured
3,220 Sacramento City Unified School District, Sacramento County, 7/15 at 100.00 Aa3 3,178,043
California, General Obligation Bonds, Series 2005, 5.000%,
7/01/27 - MBIA Insured
1,500 San Diego Unified School District, San Diego County, California, 7/13 at 101.00 AAA 1,677,495
General Obligation Bonds, Series 2003E, 5.250%, 7/01/24 - FSA
Insured
2,565 Sunnyvale School District, Santa Clara County, California, General 9/15 at 100.00 AAA 2,571,874
Obligation Bonds, Series 2005A, 5.000%, 9/01/26 - FSA Insured
------------------------------------------------------------------------------------------------------------------------------------
22,350 Total Tax Obligation/General 18,522,614
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 20.2%
1,000 Bell Community Redevelopment Agency, California, Tax Allocation 10/13 at 100.00 BBB+ 827,350
Bonds, Bell Project Area, Series 2003, 5.625%, 10/01/33 - RAAI
Insured
3,500 California State Public Works Board, Lease Revenue Bonds, Department No Opt. Call AA- 4,058,351
of Corrections, Calipatria State Prison, Series 1991A, 6.500%,
9/01/17 - MBIA Insured
1,000 California State Public Works Board, Lease Revenue Bonds, Department 6/14 at 100.00 A- 956,410
of Mental Health, Coalinga State Hospital, Series 2004A, 5.500%,
6/01/23
43
NXC | Nuveen California Select Tax-Free Income Portfolio (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED (continued)
$ 120 Capistrano Unified School District, Orange County, California, 9/15 at 100.00 AA- $ 106,813
Special Tax Bonds, Community Facilities District, Series 2005,
5.000%, 9/01/24 - FGIC Insured
360 Chino Redevelopment Agency, California, Merged Chino Redevelopment 9/16 at 101.00 A 275,422
Project Area Tax Allocation Bonds, Series 2006, 5.000%, 9/01/38 -
AMBAC Insured
1,000 Fontana Public Financing Authority, California, Tax Allocation 10/15 at 100.00 A 817,460
Revenue Bonds, North Fontana Redevelopment Project, Series 2005A,
5.000%, 10/01/32 - AMBAC Insured
3,150 Golden State Tobacco Securitization Corporation, California, Tobacco 6/15 at 100.00 A2 2,308,478
Settlement Asset-Backed Revenue Bonds, Series 2005A, 5.000%,
6/01/45 - AMBAC Insured
Irvine, California, Unified School District, Community Facilities
District Special Tax Bonds, Series 2006A:
60 5.000%, 9/01/26 9/16 at 100.00 N/R 47,540
135 5.125%, 9/01/36 9/16 at 100.00 N/R 98,225
215 Los Angeles Community Redevelopment Agency, California, Lease 9/15 at 100.00 A2 180,465
Revenue Bonds, Manchester Social Services Project, Series 2005,
5.000%, 9/01/37 - AMBAC Insured
1,300 Orange County, California, Special Tax Bonds, Community Facilities 8/12 at 101.00 N/R 1,037,387
District 03-1 of Ladera Ranch, Series 2004A, 5.625%, 8/15/34
105 Rialto Redevelopment Agency, California, Tax Allocation Bonds, 9/15 at 100.00 A- 84,340
Merged Project Area, Series 2005A, 5.000%, 9/01/35 - SYNCORA GTY
Insured
130 Roseville, California, Certificates of Participation, Public 8/13 at 100.00 A 121,580
Facilities, Series 2003A, 5.000%, 8/01/25 - AMBAC Insured
605 Sacramento City Financing Authority, California, Lease Revenue No Opt. Call AA- 639,037
Refunding Bonds, Series 1993A, 5.400%, 11/01/20 - MBIA Insured
3,000 San Mateo County Transit District, California, Sales Tax Revenue 6/15 at 100.00 AA 3,137,310
Bonds, Series 2005A, 5.000%, 6/01/21 - MBIA Insured
225 San Mateo Union High School District, San Mateo County, California, 12/17 at 100.00 A 187,607
Certificates of Participation, Phase 1, Series 2007A, 5.000%,
12/15/30 - AMBAC Insured
1,000 Santa Clara County Board of Education, California, Certificates of 4/12 at 101.00 AA- 985,930
Participation, Series 2002, 5.000%, 4/01/25 - MBIA Insured
1,000 Travis Unified School District, Solano County, California, 9/16 at 100.00 N/R 849,550
Certificates of Participation, Series 2006, 5.000%, 9/01/26 -
FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
17,905 Total Tax Obligation/Limited 16,719,255
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 5.6%
1,150 Foothill/Eastern Transportation Corridor Agency, California, Toll 1/10 at 100.00 BBB- 762,646
Road Revenue Bonds, Series 1995A, 5.000%, 1/01/35
3,500 Los Angeles Harbors Department, California, Revenue Refunding Bonds, 8/11 at 100.00 AA 3,524,115
Series 2001B, 5.500%, 8/01/17 - AMBAC Insured (Alternative
Minimum Tax)
445 San Francisco Airports Commission, California, Revenue Bonds, San 5/09 at 101.00 AA 368,055
Francisco International Airport, Second Series 1999, Issue 23A,
5.000%, 5/01/30 - FGIC Insured (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
5,095 Total Transportation 4,654,816
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 14.4% (4)
400 Beverly Hills Unified School District, Los Angeles County, 8/12 at 100.00 AA (4) 449,584
California, General Obligation Bonds, Series 2002A, 5.000%,
8/01/26 (Pre-refunded 8/01/12)
California Department of Water Resources, Power Supply Revenue
Bonds, Series 2002A:
1,750 5.750%, 5/01/17 (Pre-refunded 5/01/12) 5/12 at 101.00 Aaa 2,008,598
2,000 5.125%, 5/01/19 (Pre-refunded 5/01/12) 5/12 at 101.00 Aaa 2,257,800
2,600 California Educational Facilities Authority, Revenue Bonds, 11/11 at 100.00 A2 (4) 2,876,640
University of the Pacific, Series 2002, 5.250%, 11/01/21
(Pre-refunded 11/01/11)
800 California, General Obligation Bonds, Series 2004, 5.125%, 2/01/27 2/14 at 100.00 AAA 917,912
(Pre-refunded 2/01/14)
44
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED (4) (continued)
$ 2,000 North Orange County Community College District, California, General 8/12 at 101.00 AA (4) $ 2,259,400
Obligation Bonds, Series 2002A, 5.000%, 8/01/22 (Pre-refunded
8/01/12) - MBIA Insured
1,000 Port of Oakland, California, Revenue Bonds, Series 2002M, 5.250%, 11/12 at 100.00 A+ (4) 1,137,130
11/01/20 (Pre-refunded 11/01/12) - FGIC Insured
------------------------------------------------------------------------------------------------------------------------------------
10,550 Total U.S. Guaranteed 11,907,064
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 5.3%
645 Long Beach Bond Finance Authority, California, Natural Gas Purchase No Opt. Call A 406,614
Revenue Bonds, Series 2007A, 5.500%, 11/15/37
200 Los Angeles Department of Water and Power, California, Power System 7/13 at 100.00 AA- 207,972
Revenue Bonds, Series 2003A-2, 5.000%, 7/01/21 - MBIA Insured
7,600 Merced Irrigation District, California, Certificates of 9/16 at 64.56 A 2,799,004
Participation, Water and Hydroelectric System Projects, Series
2008A, 0.000%, 9/01/23
215 Merced Irrigation District, California, Electric System Revenue 9/15 at 100.00 BBB- 152,674
Bonds, Series 2005, 5.125%, 9/01/31 - SYNCORA GTY Insured
780 Turlock Irrigation District, California, Revenue Refunding Bonds, No Opt. Call A1 818,618
Series 1992A, 6.250%, 1/01/12 - MBIA Insured
------------------------------------------------------------------------------------------------------------------------------------
9,440 Total Utilities 4,384,882
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 2.2%
150 Healdsburg Public Financing Authority, California, Wastewater 4/16 at 100.00 AA- 130,607
Revenue Bonds, Series 2006, 5.000%, 4/01/36 - MBIA Insured
250 Sacramento County Sanitation District Financing Authority, 6/16 at 100.00 AA 240,155
California, Revenue Bonds, Series 2006, 5.000%, 12/01/31 - FGIC
Insured
825 South Feather Water and Power Agency, California, Water Revenue 4/13 at 100.00 BBB 696,630
Certificates of Participation, Solar Photovoltaic Project,
Series 2003, 5.375%, 4/01/24
1,000 Woodbridge Irrigation District, California, Certificates of 7/13 at 100.00 A+ 779,420
Participation, Water Systems Project, Series 2003, 5.625%,
7/01/43
------------------------------------------------------------------------------------------------------------------------------------
2,225 Total Water and Sewer 1,846,812
------------------------------------------------------------------------------------------------------------------------------------
$ 95,455 Total Long-Term Investments (cost $85,391,002) - 98.7% 81,880,116
============------------------------------------------------------------------------------------------------------------------------
45
NXC | Nuveen California Select Tax-Free Income Portfolio (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL
AMOUNT (000) DESCRIPTION (1) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 0.4%
$ 295 State Street Bank Euro Dollar Time Deposit, 0.010%, 4/01/09 N/A $ 295,477
============------------------------------------------------------------------------------------------------------------------------
Total Short-Term Investments (cost $295,477) 295,477
----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $85,686,479) - 99.1% 82,175,593
----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 0.9% 777,513
----------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 82,953,106
======================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) Optional Call Provisions (not covered by the report of independent
registered public accounting firm): Dates (month and year) and prices of
the earliest optional call or redemption. There may be other call
provisions at varying prices at later dates. Certain mortgage-backed
securities may be subject to periodic principal paydowns.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
The Portfolio of Investments may reflect the ratings on certain bonds
insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as of March 31,
2009. Please see the Portfolio Managers' Commentary for an expanded
discussion of the affect on the Fund of changes to the ratings of certain
bonds in the portfolio resulting from changes to the ratings of the
underlying insurers both during the period and after period end.
(4) Backed by an escrow or trust containing sufficient U.S. Government or U.S.
Government agency securities which ensure the timely payment of principal
and interest. Such investments are normally considered to be equivalent to
AAA rated securities.
N/A Not applicable.
N/R Not rated.
(IF) Inverse floating rate investment.
See accompanying notes to financial statements.
46
NXN | Nuveen New York Select Tax-Free Income Portfolio
| Portfolio of INVESTMENTS
March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER DISCRETIONARY - 0.1%
$ 100 New York City Industrial Development Agency, New York, Liberty 9/15 at 100.00 BB+ $ 60,666
Revenue Bonds, IAC/InterActiveCorp, Series 2005, 5.000%, 9/01/35
------------------------------------------------------------------------------------------------------------------------------------
CONSUMER STAPLES - 1.3%
TSASC Inc., New York, Tobacco Asset-Backed Bonds, Series 2006:
430 4.750%, 6/01/22 6/16 at 100.00 BBB 318,170
540 5.000%, 6/01/26 6/16 at 100.00 BBB 374,971
------------------------------------------------------------------------------------------------------------------------------------
970 Total Consumer Staples 693,141
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS - 9.8%
100 Albany Industrial Development Agency, New York, Revenue Bonds, 7/17 at 100.00 BBB 75,273
Albany Law School, Series 2007A, 5.000%, 7/01/31
50 Albany Industrial Development Agency, New York, Revenue Bonds, 4/17 at 100.00 N/R 30,363
Brighter Choice Charter Schools, Series 2007A, 5.000%, 4/01/37
1,700 Amherst Industrial Development Agency, New York, Revenue Bonds, UBF 8/12 at 101.00 A 1,703,162
Faculty/Student Housing Corporation, University of Buffalo
Creekside Project, Series 2002A, 5.000%, 8/01/22 - AMBAC Insured
30 Cattaraugus County Industrial Development Agency, New York, Revenue 5/16 at 100.00 BBB- 22,569
Bonds, St. Bonaventure University, Series 2006, 5.000%, 5/01/23
430 Dormitory Authority of the State of New York, General Revenue 7/17 at 100.00 BBB+ 313,027
Bonds, Manhattan College, Series 2007A, 5.000%, 7/01/41 - RAAI
Insured
785 Dormitory Authority of the State of New York, Insured Revenue 7/12 at 100.00 BBB 768,931
Bonds, Iona College, Series 2002, 5.000%, 7/01/22 - SYNCORA GTY
Insured
50 Dormitory Authority of the State of New York, Lease Revenue Bonds, 7/15 at 100.00 AA- 49,807
State University Dormitory Facilities, Series 2004A, 5.000%,
7/01/29 - MBIA Insured
215 Dormitory Authority of the State of New York, Second General No Opt. Call A1 222,211
Resolution Consolidated Revenue Bonds, City University System,
Series 1990C, 7.500%, 7/01/10 - FGIC Insured
430 Dutchess County Industrial Development Agency, New York, Civic 8/17 at 100.00 Baa1 324,899
Facility Revenue Bonds, Bard College Project, Series 2007-A2,
4.500%, 8/01/36
100 Hempstead Town Industrial Development Agency, New York, Revenue 10/15 at 100.00 A 90,869
Bonds, Adelphi University, Civic Facility Project, Series 2005,
5.000%, 10/01/35
100 New York City Industrial Development Agency, New York, Civic 10/14 at 100.00 A- 84,219
Facility Revenue Bonds, St. Francis College, Series 2004,
5.000%, 10/01/34
500 New York City Industrial Development Agency, New York, Civic 2/11 at 100.00 A- 503,740
Facility Revenue Bonds, YMCA of Greater New York, Series 2002,
5.250%, 8/01/21
430 New York City Industrial Development Agency, New York, PILOT 1/17 at 100.00 A 319,942
Revenue Bonds, Queens Baseball Stadium Project, Series 2006,
4.750%, 1/01/42 - AMBAC Insured
590 New York City Industrial Development Authority, New York, PILOT 9/16 at 100.00 BBB- 403,961
Revenue Bonds, Yankee Stadium Project, Series 2006, 4.500%,
3/01/39 - FGIC Insured
200 Puerto Rico Industrial, Tourist, Educational, Medical and 8/09 at 101.00 BBB- 165,952
Environmental Control Facilities Financing Authority, Higher
Education Revenue Bonds, Ana G. Mendez University System,
Series 1999, 5.375%, 2/01/19
47
NXN | Nuveen New York Select Tax-Free Income Portfolio (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
EDUCATION AND CIVIC ORGANIZATIONS (continued)
$ 65 Seneca County Industrial Development Authority, New York, Revenue 10/17 at 100.00 BBB $ 44,225
Bonds, New York Chiropractic College, Series 2007, 5.000%, 10/01/27
------------------------------------------------------------------------------------------------------------------------------------
5,775 Total Education and Civic Organizations 5,123,150
------------------------------------------------------------------------------------------------------------------------------------
FINANCIALS - 0.7%
435 Liberty Development Corporation, New York, Goldman Sachs Headquarters No Opt. Call A1 371,142
Revenue Bonds Series 2007, 5.500%, 10/01/37
------------------------------------------------------------------------------------------------------------------------------------
HEALTH CARE - 13.3%
450 Dormitory Authority of the State of New York, FHA-Insured Mortgage 2/15 at 100.00 AA- 429,516
Revenue Bonds, Montefiore Hospital, Series 2004, 5.000%, 8/01/29 -
FGIC Insured
Dormitory Authority of the State of New York, Revenue Bonds, Lenox
Hill Hospital Obligated Group, Series 2001:
110 5.375%, 7/01/20 7/11 at 101.00 Ba1 88,580
100 5.500%, 7/01/30 7/11 at 101.00 Ba1 70,447
950 Dormitory Authority of the State of New York, Revenue Bonds, Memorial 7/16 at 100.00 AA 911,069
Sloan Kettering Cancer Center, Series 2006-1, 5.000%, 7/01/35
670 Dormitory Authority of the State of New York, Revenue Bonds, Memorial 7/13 at 100.00 AA 689,175
Sloan-Kettering Cancer Center, Series 2003-1, 5.000%, 7/01/21 -
MBIA Insured
405 Dormitory Authority of the State of New York, Revenue Bonds, New York 8/14 at 100.00 AAA 435,926
and Presbyterian Hospital, Series 2004A, 5.250%, 8/15/15 - FSA
Insured
1,680 Dormitory Authority of the State of New York, Revenue Bonds, Winthrop 7/11 at 101.00 A 1,722,689
South Nassau University Health System Obligated Group, Series
2001A, 5.250%, 7/01/17 - AMBAC Insured
1,195 Dormitory Authority of the State of New York, Revenue Bonds, Winthrop 7/11 at 101.00 A 1,158,361
South Nassau University Health System Obligated Group, Series
2001B, 5.250%, 7/01/17 - AMBAC Insured
500 Dormitory Authority of the State of New York, Revenue Bonds, 7/13 at 100.00 Baa1 390,445
Winthrop-South Nassau University Hospital Association, Series
2003A, 5.500%, 7/01/32
Madison County Industrial Development Agency, New York, Civic
Facility Revenue Bonds, Oneida Health System, Series 2007A:
100 5.250%, 2/01/27 No Opt. Call BBB- 75,689
90 5.500%, 2/01/32 No Opt. Call BBB- 66,968
750 New York City Health and Hospitals Corporation, New York, Health 2/13 at 100.00 A+ 758,160
System Revenue Bonds, Series 2003A, 5.250%, 2/15/21 - AMBAC Insured
245 New York City Industrial Development Agency, New York, Civic Facility 7/12 at 101.00 Ba2 169,542
Revenue Bonds, Staten Island University Hospital, Series 2002C,
6.450%, 7/01/32
------------------------------------------------------------------------------------------------------------------------------------
7,245 Total Health Care 6,966,567
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/MULTIFAMILY - 2.9%
1,000 New Hartford-Sunset Woods Funding Corporation, New York, FHA-Insured 8/12 at 101.00 AAA 1,029,650
Mortgage Revenue Bonds, Sunset Woods Apartments II Project, Series
2002, 5.350%, 2/01/20
250 New York City Housing Development Corporation, New York, Multifamily 5/14 at 100.00 AA 246,810
Housing Revenue Bonds, Series 2004A, 5.250%, 11/01/30
275 New York State Housing Finance Agency, Affordable Housing Revenue, 11/17 at 100.00 Aa2 251,185
Series 2007A, 5.250%, 11/01/38 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,525 Total Housing/Multifamily 1,527,645
------------------------------------------------------------------------------------------------------------------------------------
HOUSING/SINGLE FAMILY - 8.4%
2,000 New York State Mortgage Agency, Homeowner Mortgage Revenue Bonds, 10/11 at 100.00 Aa1 2,015,880
Series 101, 5.000%, 10/01/18 (Alternative Minimum Tax)
2,500 New York State Mortgage Agency, Mortgage Revenue Bonds, Thirty-First 4/11 at 100.00 Aaa 2,344,025
Series A, 5.300%, 10/01/31 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
4,500 Total Housing/Single Family 4,359,905
------------------------------------------------------------------------------------------------------------------------------------
48
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
LONG-TERM CARE - 11.7%
$ 1,890 Dormitory Authority of the State of New York, FHA-Insured Nursing 8/11 at 101.00 AA- $ 1,812,737
Home Mortgage Revenue Bonds, Norwegian Christian Home and Health
Center, Series 2001, 5.200%, 8/01/36 - MBIA Insured
100 Dormitory Authority of the State of New York, Non-State Supported 11/16 at 100.00 Aa3 93,329
Debt, Ozanam Hall of Queens Nursing Home Revenue Bonds, Series
2006, 5.000%, 11/01/31
50 Dormitory Authority of the State of New York, Revenue Bonds, 7/15 at 100.00 N/R 27,077
Providence Rest, Series 2005, 5.000%, 7/01/35 - ACA Insured
2,000 East Rochester Housing Authority, New York, FHA-Insured Mortgage 8/12 at 101.00 AAA 2,038,960
Revenue Refunding Bonds, Jewish Home of Rochester, Series 2002,
4.625%, 2/15/17
1,000 East Rochester Housing Authority, New York, Revenue Bonds, 12/12 at 103.00 AAA 1,016,650
GNMA/FHA-Secured Revenue Bonds, St. Mary's Residence Project,
Series 2002A, 5.375%, 12/20/22
980 New York City Industrial Development Agency, New York, GNMA 11/12 at 101.00 AA+ 884,205
Collateralized Mortgage Revenue Bonds, Eger Harbor House Inc.,
Series 2002A, 4.950%, 11/20/32
25 Suffolk County Industrial Development Agency, New York, Civic 7/16 at 100.00 N/R 20,062
Facility Revenue Bonds, Special Needs Facilities Pooled Program,
Series 2008-B1, 5.500%, 7/01/18
275 Yonkers Industrial Development Agency, New York, Civic Facilities 7/16 at 101.00 N/R 219,775
Revenue Bonds, Special Needs Facilities Pooled Program Bonds,
Series 2008-C1, 5.500%, 7/01/18
------------------------------------------------------------------------------------------------------------------------------------
6,320 Total Long-Term Care 6,112,795
------------------------------------------------------------------------------------------------------------------------------------
MATERIALS - 0.1%
90 Jefferson County Industrial Development Agency, New York, Solid Waste 12/13 at 100.00 BBB 59,566
Disposal Revenue Bonds, International Paper Company Project,
Series 2003A, 5.200%, 12/01/20 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/GENERAL - 8.6%
Clarkstown, Rickland County, New York, Various Purposes Serial Bonds,
Series 1992:
505 5.600%, 6/15/10 - AMBAC Insured No Opt. Call AAA 534,320
525 5.600%, 6/15/11 - AMBAC Insured No Opt. Call AAA 573,977
525 5.600%, 6/15/12 - AMBAC Insured No Opt. Call AAA 590,016
300 New York City, New York, General Obligation Bonds, Fiscal Series 8/14 at 100.00 AA 326,109
2004C, 5.250%, 8/15/16
200 New York City, New York, General Obligation Bonds, Fiscal Series 3/15 at 100.00 AA 206,016
2005J, 5.000%, 3/01/19 - FGIC Insured
1,000 New York City, New York, General Obligation Bonds, Fiscal Series 6/16 at 100.00 AA 999,050
2006J-1, 5.000%, 6/01/25
1,260 New York City, New York, General Obligation Bonds, Series D, 5.125%, 12/17 at 100.00 AA 1,267,535
12/01/25
------------------------------------------------------------------------------------------------------------------------------------
4,315 Total Tax Obligation/General 4,497,023
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED - 16.7%
600 Battery Park City Authority, New York, Senior Revenue Bonds, Series 11/13 at 100.00 AAA 629,310
2003A, 5.000%, 11/01/23
500 Erie County Industrial Development Agency, New York, School Facility 5/14 at 100.00 AAA 508,550
Revenue Bonds, Buffalo City School District, Series 2004, 5.750%,
5/01/26 - FSA Insured
500 Metropolitan Transportation Authority, New York, State Service 7/12 at 100.00 AA- 515,230
Contract Refunding Bonds, Series 2002A, 5.500%, 1/01/20 - MBIA
Insured
95 Nassau County Interim Finance Authority, New York, Sales Tax Secured 5/09 at 100.00 AAA 95,169
Revenue Bonds, Series 2001A-2, 5.125%, 11/15/21 - AMBAC Insured
New York City Sales Tax Asset Receivable Corporation, New York,
Dedicated Revenue Bonds, Local Government Assistance
Corporation, Series 2004A:
250 5.000%, 10/15/25 - MBIA Insured 10/14 at 100.00 AAA 257,200
200 5.000%, 10/15/26 - MBIA Insured 10/14 at 100.00 AAA 204,556
1,225 5.000%, 10/15/29 - AMBAC Insured 10/14 at 100.00 AAA 1,237,360
600 New York City Transitional Finance Authority, New York, Building Aid 1/17 at 100.00 AA- 573,888
Revenue Bonds, Fiscal Series 2007S-2, 5.000%, 1/15/28 - FGIC
Insured
670 New York City Transitional Finance Authority, New York, Future Tax 2/13 at 100.00 AAA 684,640
Secured Bonds, Fiscal Series 2003E, 5.000%, 2/01/23
49
NXN | Nuveen New York Select Tax-Free Income Portfolio (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
TAX OBLIGATION/LIMITED (continued)
$ 550 New York City Transitional Finance Authority, New York, Future Tax 11/17 at 100.00 AAA $ 555,330
Secured Bonds, Fiscal Series 2007C-1, 5.000%, 11/01/27
775 New York State Environmental Facilities Corporation, State Personal 12/17 at 100.00 AAA 788,074
Income Tax Revenue Bonds, Series 2008A, 5.000%, 12/15/26 (UB)
250 New York State Thruway Authority, Highway and Bridge Trust Fund 4/14 at 100.00 AA 261,920
Bonds, Second Genera1 Series 2004, 5.000%, 4/01/21 - MBIA Insured
145 New York State Thruway Authority, Highway and Bridge Trust Fund No Opt. Call AA 210,882
Bonds, Series 2005B, Trust 2800, 19.498%, 4/01/20 - AMBAC Insured
(IF)
425 New York State Thruway Authority, Highway and Bridge Trust Fund 10/17 at 100.00 AA 423,500
Bonds, Series 2007, 5.000%, 4/01/27
New York State Tobacco Settlement Financing Corporation, Tobacco
Settlement Asset-Backed and State Contingency Contract-Backed
Bonds, Series 2003A-1:
1,000 5.250%, 6/01/20 - AMBAC Insured 6/13 at 100.00 AA- 1,006,160
250 5.250%, 6/01/21 - AMBAC Insured 6/13 at 100.00 AA- 250,510
500 New York State Tobacco Settlement Financing Corporation, Tobacco 6/13 at 100.00 AA- 505,275
Settlement Asset-Backed and State Contingency Contract-Backed
Bonds, Series 2003B-1C, 5.500%, 6/01/21
15 Triborough Bridge and Tunnel Authority, New York, Convention Center No Opt. Call AA- 15,700
Bonds, Series 1990E, 7.250%, 1/01/10
------------------------------------------------------------------------------------------------------------------------------------
8,550 Total Tax Obligation/Limited 8,723,254
------------------------------------------------------------------------------------------------------------------------------------
TRANSPORTATION - 2.0%
180 Albany Parking Authority, New York, Revenue Bonds, Series 2001A, 7/11 at 101.00 BBB+ 177,811
5.625%, 7/15/25
500 Metropolitan Transportation Authority, New York, Transportation No Opt. Call AA- 531,925
Revenue Bonds, Series 2003A, 5.000%, 11/15/15 - FGIC Insured
100 New York State Thruway Authority, General Revenue Bonds, Series 7/15 at 100.00 AAA 98,595
2005G, 5.000%, 1/01/30 - FSA Insured
105 Port Authority of New York and New Jersey, Consolidated Revenue 6/15 at 101.00 AA- 104,429
Bonds, One Hundred Fortieth Series 2005, 5.000%, 12/01/31 -
SYNCORA GTY Insured
120 Port Authority of New York and New Jersey, Consolidated Revenue 8/17 at 100.00 AAA 118,157
Bonds, One Hundred Forty Eighth Series 2008, Trust 2920, 17.447%,
8/15/32 - FSA Insured (IF)
------------------------------------------------------------------------------------------------------------------------------------
1,005 Total Transportation 1,030,917
------------------------------------------------------------------------------------------------------------------------------------
U.S. GUARANTEED - 6.2% (4)
220 Albany Parking Authority, New York, Revenue Bonds, Series 2001A, 7/11 at 101.00 N/R (4) 245,606
5.625%, 7/15/25 (Pre-refunded 7/15/11)
1,080 Dormitory Authority of the State of New York, Judicial Facilities No Opt. Call AAA 1,289,185
Lease Revenue Bonds, Suffolk County Issue, Series 1986, 7.375%,
7/01/16 (ETM)
250 Dormitory Authority of the State of New York, Revenue Bonds, North 5/13 at 100.00 Aaa 287,563
Shore Long Island Jewish Group, Series 2003, 5.375%, 5/01/23
(Pre-refunded 5/01/13)
340 Suffolk County Water Authority, New York, Water Revenue Bonds, Series No Opt. Call AAA 370,114
1986V, 6.750%, 6/01/12 (ETM)
965 TSASC Inc., New York, Tobacco Asset-Backed Bonds, Series 2002-1, 7/12 at 100.00 AAA 1,064,144
5.500%, 7/15/24 (Pre-refunded 7/15/12)
------------------------------------------------------------------------------------------------------------------------------------
2,855 Total U.S. Guaranteed 3,256,612
------------------------------------------------------------------------------------------------------------------------------------
50
PRINCIPAL OPTIONAL CALL
AMOUNT (000) DESCRIPTION (1) PROVISIONS (2) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
UTILITIES - 3.4%
Long Island Power Authority, New York, Electric System General
Revenue Bonds, Series 2006A:
$ 570 5.000%, 12/01/23 - FGIC Insured 6/16 at 100.00 AA- $ 569,373
430 5.000%, 12/01/25 - FGIC Insured 6/16 at 100.00 AA- 424,229
500 New York State Energy Research and Development Authority, Pollution 3/11 at 100.00 AA- 485,420
Control Revenue Bonds, New York State Electric and Gas
Corporation, Series 2005A, 4.100%, 3/15/15 - MBIA Insured
250 Niagara County Industrial Development Agency, New York, Solid Waste 11/11 at 101.00 Baa2 234,018
Disposal Facility Revenue Bonds, American Ref-Fuel Company of
Niagara LP, Series 2001A, 5.450%, 11/15/26 (Mandatory put
11/15/12) (Alternative Minimum Tax)
60 Westchester County Industrial Development Agency, Westchester County, 6/09 at 100.00 BBB 59,895
New York, Resource Recovery Revenue Bonds, RESCO Company, Series
1996, 5.500%, 7/01/09 (Alternative Minimum Tax)
------------------------------------------------------------------------------------------------------------------------------------
1,810 Total Utilities 1,772,935
------------------------------------------------------------------------------------------------------------------------------------
WATER AND SEWER - 12.7%
2,500 New York City Municipal Water Finance Authority, New York, Water and 6/11 at 101.00 AAA 2,502,372
Sewerage System Revenue Bonds, Fiscal Series 2001C, 5.125%, 6/15/33
New York State Environmental Facilities Corporation, State Clean
Water and Drinking Water
Revolving Funds Revenue Bonds, New York City Municipal Water Finance
Authority Loan, Series 2002B:
2,000 5.250%, 6/15/19 6/12 at 100.00 AAA 2,098,960
2,000 5.000%, 6/15/27 6/12 at 100.00 AAA 2,018,120
------------------------------------------------------------------------------------------------------------------------------------
6,500 Total Water and Sewer 6,619,452
------------------------------------------------------------------------------------------------------------------------------------
$ 51,995 Total Long-Term Investments (cost $52,482,440) - 97.9% 51,174,770
============------------------------------------------------------------------------------------------------------------------------
51
NXN | Nuveen New York Select Tax-Free Income Portfolio (continued)
| Portfolio of INVESTMENTS March 31, 2009
PRINCIPAL
AMOUNT (000) DESCRIPTION (1) RATINGS (3) VALUE
------------------------------------------------------------------------------------------------------------------------------------
SHORT-TERM INVESTMENTS - 2.1%
$ 1,093 State Street Bank Euro Dollar Time Deposit, 0.010%, 4/01/09 N/A 1,092,572
============------------------------------------------------------------------------------------------------------------------------
Total Short-Term Investments (cost $1,092,572) 1,092,572
----------------------------------------------------------------------------------------------------------------------
Total Investments (cost $53,575,012) - 100.0% 52,267,342
----------------------------------------------------------------------------------------------------------------------
Floating Rate Obligations - (1.1)% (580,000)
----------------------------------------------------------------------------------------------------------------------
Other Assets Less Liabilities - 1.1% 580,645
----------------------------------------------------------------------------------------------------------------------
Net Assets - 100% $ 52,267,987
======================================================================================================================
(1) All percentages shown in the Portfolio of Investments are based on net
assets.
(2) Optional Call Provisions (not covered by the report of independent
registered public accounting firm): Dates (month and year) and prices of
the earliest optional call or redemption. There may be other call
provisions at varying prices at later dates. Certain mortgage-backed
securities may be subject to periodic principal paydowns.
(3) Ratings (not covered by the report of independent registered public
accounting firm): Using the higher of Standard & Poor's Group ("Standard &
Poor's") or Moody's Investor Service, Inc. ("Moody's") rating. Ratings
below BBB by Standard & Poor's or Baa by Moody's are considered to be
below investment grade.
The Portfolio of Investments may reflect the ratings on certain bonds
insured by ACA, AMBAC, FGIC, FSA, MBIA, RAAI and SYNCORA as of March 31,
2009. Please see the Portfolio Managers' Commentary for an expanded
discussion of the affect on the Fund of changes to the ratings of certain
bonds in the portfolio resulting from changes to the ratings of the
underlying insurers both during the period and after period end.
(4) Backed by an escrow or trust containing sufficient U.S. Government or U.S.
Government agency securities which ensure the timely payment of principal
and interest. Such investments are normally considered to be equivalent to
AAA rated securities.
N/A Not applicable.
N/R Not rated.
(ETM) Escrowed to maturity.
(IF) Inverse floating rate investment.
(UB) Underlying bond of an inverse floating rate trust reflected as a financing
transaction pursuant to the provisions of SFAS No. 140. See Notes to
Financial Statements, Footnote 1- Inverse Floating Rate Securities for
more information.
See accompanying notes to financial statements.
52
| Statement of ASSETS & LIABILITIES
March 31, 2009
SELECT SELECT SELECT CALIFORNIA NEW YORK
TAX-FREE TAX-FREE 2 TAX-FREE 3 SELECT TAX-FREE SELECT TAX-FREE
(NXP) (NXQ) _ (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
ASSETS
Investments, at value
(cost $225,908,904, $242,201,127, $176,632,345,
$85,686,479 and $53,575,012, respectively) $ 219,407,173 $ 220,050,549 $ 171,677,505 $ 82,175,593 $ 52,267,342
Interest receivable 3,679,583 3,759,065 2,746,633 1,136,239 796,649
Other assets 51,120 53,624 40,859 23,820 17,488
------------------------------------------------------------------------------------------------------------------------------------
Total assets 223,137,876 223,863,238 174,464,997 83,335,652 53,081,479
------------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
Floating rate obligations -- -- -- -- 580,000
Common share dividends payable 846,284 900,720 642,295 312,292 184,164
Accrued expenses:
Management fees 46,041 55,653 43,618 21,137 13,255
Other 131,143 135,687 101,527 49,117 36,073
------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 1,023,468 1,092,060 787,440 382,546 813,492
------------------------------------------------------------------------------------------------------------------------------------
Net assets $ 222,114,408 $ 222,771,178 $ 173,677,557 $ 82,953,106 $ 52,267,987
====================================================================================================================================
Shares outstanding 16,432,057 17,637,435 12,978,714 6,267,291 3,909,847
====================================================================================================================================
Net asset value per share outstanding $ 13.52 $ 12.63 $ 13.38 $ 13.24 $ 13.37
====================================================================================================================================
NET ASSETS CONSIST OF:
====================================================================================================================================
Shares, $.01 par value per share $ 164,321 $ 176,374 $ 129,787 $ 62,673 $ 39,098
Paid-in surplus 228,393,639 246,094,428 178,571,782 87,263,868 53,644,447
Undistributed (Over-distribution of)
net investment income 965,770 473,587 (81,861) (2,633) (49,080)
Accumulated net realized gain (loss) from (907,591) (1,822,633) 12,689 (859,916) (58,808)
investments
Net unrealized appreciation (depreciation)
of investments (6,501,731) (22,150,578) (4,954,840) (3,510,886) (1,307,670)
------------------------------------------------------------------------------------------------------------------------------------
Net assets $ 222,114,408 $ 222,771,178 $ 173,677,557 $ 82,953,106 $ 52,267,987
====================================================================================================================================
Authorized shares Unlimited Unlimited Unlimited Unlimited Unlimited
====================================================================================================================================
See accompanying notes to financial statements.
53
| Statement of OPERATIONS
Year Ended March 31, 2009
SELECT SELECT SELECT CALIFORNIA NEW YORK
TAX-FREE TAX-FREE 2 TAX-FREE 3 SELECT TAX-FREE SELECT TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
-----------------------------------------------------------------------------------------------------------------------------------
INVESTMENT INCOME $ 12,347,791 $ 12,747,234 $ 9,197,520 $ 4,492,902 $ 2,651,277
-----------------------------------------------------------------------------------------------------------------------------------
EXPENSES
Management fees 537,430 668,213 509,629 249,089 154,014
Shareholders' servicing agent fees and expenses 24,743 22,505 18,972 6,916 5,796
Interest expense on floating rate obligations -- 22,135 1,937 17,261 13,650
Custodian's fees and expenses 42,677 44,536 36,909 21,829 20,072
Trustees' fees and expenses 6,432 6,551 4,716 2,426 1,429
Professional fees 17,996 18,223 15,671 11,511 9,973
Shareholders' reports - printing and mailing
expenses 71,378 73,894 55,335 25,509 21,794
Stock exchange listing fees 9,266 9,218 9,208 9,209 9,204
Investor relations expense 37,568 37,943 28,310 12,754 8,389
Other expenses 9,020 9,386 8,057 6,528 5,379
-----------------------------------------------------------------------------------------------------------------------------------
Total expenses before custodian fee credit 756,510 912,604 688,744 363,032 249,700
Custodian fee credit (10,756) (12,616) (6,769) (8,165) (4,076)
-----------------------------------------------------------------------------------------------------------------------------------
Net expenses 745,754 899,988 681,975 354,867 245,624
-----------------------------------------------------------------------------------------------------------------------------------
Net investment income 11,602,037 11,847,246 8,515,545 4,138,035 2,405,653
-----------------------------------------------------------------------------------------------------------------------------------
REALIZED AND UNREALIZED GAIN (LOSS)
Net realized gain (loss) from investments 414,250 (157,525) 95,185 (777,009) (18,617)
Change in net unrealized appreciation
(depreciation) of investments (13,684,819) (22,829,917) (8,093,041) (4,560,505) (1,645,443)
-----------------------------------------------------------------------------------------------------------------------------------
Net realized and unrealized gain (loss) (13,270,569) (22,987,442) (7,997,856) (5,337,514) (1,664,060)
-----------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets from
operations $ (1,668,532) $ (11,140,196) $ 517,689 $ (1,199,479) $ 741,593
-----------------------------------------------------------------------------------------------------------------------------------
See accompanying notes to financial statements.
54
| Statement of CHANGES in NET ASSETS
SELECT TAX-FREE (NXP) SELECT TAX-FREE 2 (NXQ) SELECT TAX-FREE 3 (NXR)
---------------------------- ---------------------------- ----------------------------
YEAR YEAR YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED ENDED ENDED
3/31/09 3/31/08 3/31/09 3/31/08 3/31/09 3/31/08
--------------------------------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 11,602,037 $ 11,509,535 $ 11,847,246 $ 11,618,930 $ 8,515,545 $ 8,305,757
Net realized gain (loss) from:
Investments 414,250 147,459 (157,525) (288,340) 95,185 (48,471)
Forward swaps -- -- -- -- -- --
Change in net unrealized appreciation
(depreciation) of investments (13,684,819) (7,207,078) (22,829,917) (11,881,693) (8,093,041) (5,615,646)
--------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from operations (1,668,532) 4,449,916 (11,140,196) (551,103) 517,689 2,641,640
--------------------------------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (11,226,050) (11,213,242) (11,736,647) (11,242,116) (8,327,575) (8,322,967)
From accumulated net realized gains -- -- -- -- -- --
--------------------------------------------------------------------------------------------------------------------------------
Decrease in net assets from
distributions to shareholders (11,226,050) (11,213,242) (11,736,647) (11,242,116) (8,327,575) (8,322,967)
--------------------------------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from shares issued
to shareholders due to
reinvestment of distributions 515,396 182,700 403,746 -- 199,823 --
--------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from capital share transactions 515,396 182,700 403,746 -- 199,823 --
--------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (12,379,186) (6,580,626) (22,473,097) (11,793,219) (7,610,063) (5,681,327)
Net assets at the beginning of year 234,493,594 241,074,220 245,244,275 257,037,494 181,287,620 186,968,947
--------------------------------------------------------------------------------------------------------------------------------
Net assets at the end of year $ 222,114,408 $ 234,493,594 $ 222,771,178 $ 245,244,275 $ 173,677,557 $ 181,287,620
================================================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of year $ 965,770 $ 614,501 $ 473,587 $ 364,500 $ (81,861) $ (269,392)
================================================================================================================================
See accompanying notes to financial statements.
55
| Statement of CHANGES in NET ASSETS (continued)
CALIFORNIA SELECT TAX-FREE (NXC) NEW YORK SELECT TAX-FREE (NXN)
-------------------------------- ------------------------------
YEAR YEAR YEAR YEAR
ENDED ENDED ENDED ENDED
3/31/09 3/31/08 3/31/09 3/31/08
----------------------------------------------------------------------------------------------------------
OPERATIONS
Net investment income $ 4,138,035 $ 4,101,055 $ 2,405,653 $ 2,406,620
Net realized gain (loss) from:
Investments (777,009) (84,927) (18,617) (82,020)
Forward swaps -- -- -- 41,813
Change in net unrealized appreciation
(depreciation) of investments (4,560,505) (3,947,262) (1,645,443) (1,858,128)
----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from operations (1,199,479) 68,866 741,593 508,285
----------------------------------------------------------------------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS
From net investment income (4,172,698) (3,995,905) (2,392,826) (2,391,875)
From accumulated net realized gains -- (66,966) -- (47,290)
----------------------------------------------------------------------------------------------------------
Decrease in net assets from
distributions to shareholders (4,172,698) (4,062,871) (2,392,826) (2,439,165)
----------------------------------------------------------------------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from shares issued
to shareholders due to
reinvestment of distributions 101,344 40,911 10,984 11,240
----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
from capital share transactions 101,344 40,911 10,984 11,240
----------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets (5,270,833) (3,953,094) (1,640,249) (1,919,640)
Net assets at the beginning of year 88,223,939 92,177,033 53,908,236 55,827,876
----------------------------------------------------------------------------------------------------------
Net assets at the end of year $ 82,953,106 $ 88,223,939 $ 52,267,987 $ 53,908,236
==========================================================================================================
Undistributed (Over-distribution of)
net investment income at the
end of year $ (2,633) $ 34,049 $ (49,080) $ (61,907)
==========================================================================================================
See accompanying notes to financial statements.
56
| Notes to FINANCIAL STATEMENTS
1. GENERAL INFORMATION AND SIGNIFICANT ACCOUNTING POLICIES
The funds covered in this report and their corresponding New York Stock Exchange
symbols are Nuveen Select Tax-Free Income Portfolio (NXP), Nuveen Select
Tax-Free Income Portfolio 2 (NXQ), Nuveen Select Tax-Free Income Portfolio 3
(NXR), Nuveen California Select Tax-Free Income Portfolio (NXC) and Nuveen New
York Select Tax-Free Income Portfolio (NXN) (collectively, the "Funds"). The
Funds are registered under the Investment Company Act of 1940, as amended, as
closed-end, diversified management investment companies.
Each Fund seeks to provide stable dividends consistent with the preservation of
capital, exempt from regular federal and designated state income taxes, where
applicable, by investing primarily in a diversified portfolio of municipal
obligations.
The following is a summary of significant accounting policies followed by the
Funds in the preparation of their financial statements in accordance with US
generally accepted accounting principles.
Investment Valuation
The prices of municipal bonds in each Fund's investment portfolio are provided
by a pricing service approved by the Fund's Board of Trustees. Prices of forward
swap contracts are also provided by an independent pricing service approved by
each Fund's Board of Trustees. When market price quotes are not readily
available (which is usually the case for municipal securities), the pricing
service or, in the absence of a pricing service for a particular investment or
derivative instrument, the Board of Trustees of the Fund, or its designee, may
establish fair value using a wide variety of market data including yields or
prices of investments of comparable quality, type of issue, coupon, maturity and
rating, market quotes or indications of value from security dealers, evaluations
of anticipated cash flows or collateral, general market conditions and other
information and analysis, including the obligor's credit characteristics
considered relevant. Temporary investments in securities that have variable rate
and demand features qualifying them as short-term investments are valued at
amortized cost, which approximates value.
Investment Transactions
Investment transactions are recorded on a trade date basis. Realized gains and
losses from transactions are determined on the specific identification method.
Investments purchased on a when-issued/delayed delivery basis may have extended
settlement periods. Any investments so purchased are subject to market
fluctuation during this period. The Funds have instructed the custodian to
segregate assets with a current value at least equal to the amount of the
when-issued/delayed delivery purchase commitments. At March 31, 2009, there were
no such outstanding purchase commitments in any of the Funds.
Investment Income
Interest income, which includes the amortization of premiums and accretion of
discounts for financial reporting purposes, is recorded on an accrual basis.
Interest income also includes paydown gains and losses, if any.
Income Taxes
Each Fund is a separate taxpayer for federal income tax purposes. Each Fund
intends to distribute substantially all of its net investment income and net
capital gains to shareholders and to otherwise comply with the requirements of
Subchapter M of the Internal Revenue Code applicable to regulated investment
companies. Therefore, no federal income tax provision is required. Furthermore,
each Fund intends to satisfy conditions which will enable interest from
municipal securities, which is exempt from regular federal and designated state
income taxes, to retain such tax-exempt status when distributed to shareholders
of the Funds. Net realized capital gains and ordinary income distributions paid
by the Funds are subject to federal taxation.
57
| Notes to FINANCIAL STATEMENTS (continued)
For all open tax years and all major taxing jurisdictions, management of the
Funds has concluded that there are no significant uncertain tax positions that
would require recognition in the financial statements. Open tax years are those
that are open for examination by taxing authorities (i.e., generally the last
four tax year ends and the interim tax period since then). Furthermore,
management of the Funds is also not aware of any tax positions for which it is
reasonably possible that the total amounts of unrecognized tax benefits will
significantly change in the next twelve months.
Dividends and Distributions to Shareholders
Dividends from tax-exempt net investment income are declared monthly. Net
realized capital gains and/or market discount from investment transactions, if
any, are distributed to shareholders at least annually. Furthermore, capital
gains are distributed only to the extent they exceed available capital loss
carryforwards.
Distributions to shareholders of tax-exempt net investment income, net realized
capital gains and/or market discount, if any, are recorded on the ex-dividend
date. The amount and timing of distributions are determined in accordance with
federal income tax regulations, which may differ from US generally accepted
accounting principles.
Inverse Floating Rate Securities
Each Fund is authorized to invest in inverse floating rate securities. An
inverse floating rate security is created by depositing a municipal bond,
typically with a fixed interest rate, into a special purpose trust created by a
broker-dealer. In turn, this trust (a) issues floating rate certificates, in
face amounts equal to some fraction of the deposited bond's par amount or market
value, that typically pay short-term tax-exempt interest rates to third parties,
and (b) issues to a long-term investor (such as one of the Funds) an inverse
floating rate certificate (sometimes referred to as an "inverse floater") that
represents all remaining or residual interest in the trust. The income received
by the inverse floater holder varies inversely with the short-term rate paid to
the floating rate certificates' holders, and in most circumstances the inverse
floater holder bears substantially all of the underlying bond's downside
investment risk and also benefits disproportionately from any potential
appreciation of the underlying bond's value. The price of an inverse floating
rate security will be more volatile than that of the underlying bond because the
interest rate is dependent on not only the fixed coupon rate of the underlying
bond but also on the short-term interest paid on the floating rate certificates,
and because the inverse floating rate security essentially bears the risk of
loss of the greater face value of the underlying bond.
A Fund may purchase an inverse floating rate security in a secondary market
transaction without first owning the underlying bond (referred to as an
"externally-deposited inverse floater"), or instead by first selling a
fixed-rate bond to a broker-dealer for deposit into the special purpose trust
and receiving in turn the residual interest in the trust (referred to as a
"self-deposited inverse floater"). The inverse floater held by a Fund gives the
Fund the right (a) to cause the holders of the floating rate certificates to
tender their notes at par, and (b) to have the broker transfer the fixed-rate
bond held by the trust to the Fund, thereby collapsing the trust. An investment
in an externally-deposited inverse floater is identified in the Portfolio of
Investments as "(IF) - Inverse floating rate investment." An investment in a
self-deposited inverse floater is accounted for as a financing transaction in
accordance with Statement of Financial Accounting Standards No. 140 (SFAS No.
140) "Accounting for Transfers and Servicing of Financial Assets and
Extinguishment of Liabilities." In such instances, a fixed-rate bond deposited
into a special purpose trust is identified in the Portfolio of Investments as
"(UB) - Underlying bond of an inverse floating rate trust," with the Fund
accounting for the short-term floating rate certificates issued by the trust as
"Floating rate obligations" on the Statement of Assets and Liabilities. In
addition, the Fund reflects in "Investment Income" the entire earnings of the
underlying bond and the related interest paid to the holders of the short-term
floating rate certificates is recognized as "Interest expense on floating rate
obligations" on the Statement of Operations.
During the fiscal year ended March 31, 2009, each Fund invested in externally
deposited inverse floaters and/or self-deposited inverse floaters.
58
Each Fund may also enter into shortfall and forbearance agreements (sometimes
referred to as a "recourse trust" or "credit recovery swap") (such agreements
referred to herein as "Recourse Trusts") with a broker-dealer by which a Fund
agrees to reimburse the broker-dealer, in certain circumstances, for the
difference between the liquidation value of the fixed-rate bond held by the
trust and the liquidation value of the floating rate certificates issued by the
trust plus any shortfalls in interest cash flows. Under these agreements, a
Fund's potential exposure to losses related to or on inverse floaters may
increase beyond the value of a Fund's inverse floater investments as a Fund may
potentially be liable to fulfill all amounts owed to holders of the floating
rate certificates. At period end, any such shortfall is recognized as
"Unrealized depreciation on Recourse Trusts" on the Statement of Assets and
Liabilities.
At March 31, 2009, none of the Funds were invested in externally-deposited
Recourse Trusts.
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
-------------------------------------------------------------------------------------------------------------------------
Maximum exposure to Recourse Trusts $ -- $ -- $ -- $ -- $ --
=========================================================================================================================
The average floating rate obligations outstanding and average annual interest
rate and fees related to self-deposited inverse floaters during the fiscal year
ended March 31, 2009, were as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT
TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXQ) (NXR) (NXC) (NXN)
-------------------------------------------------------------------------------------------------------------------------
Average floating rate obligations $ 861,329 $ 81,986 $ 796,438 $663,521
Average annual interest rate and fees 2.57% 2.36% 2.17% 2.06%
=========================================================================================================================
Forward Swap Transactions
Each Fund is authorized to invest in forward interest rate swap transactions.
Each Fund's use of forward interest rate swap transactions is intended to help
the Fund manage its overall interest rate sensitivity, either shorter or longer,
generally to more closely align the Fund's interest rate sensitivity with that
of the broader municipal market. Forward interest rate swap transactions involve
each Fund's agreement with a counterparty to pay, in the future, a fixed or
variable rate payment in exchange for the counterparty paying the Fund a
variable or fixed rate payment, the accruals for which would begin at a
specified date in the future (the "effective date"). The amount of the payment
obligation is based on the notional amount of the forward swap contract and the
termination date of the swap (which is akin to a bond's maturity). The value of
the Fund's swap commitment would increase or decrease based primarily on the
extent to which long-term interest rates for bonds having a maturity of the
swap's termination date increases or decreases. The Funds may terminate a swap
contract prior to the effective date, at which point a realized gain or loss is
recognized. When a forward swap is terminated, it ordinarily does not involve
the delivery of securities or other underlying assets or principal, but rather
is settled in cash on a net basis. Each Fund intends, but is not obligated, to
terminate its forward swaps before the effective date. None of the Funds
invested in forward interest rate swap transactions during the fiscal year ended
March 31, 2009.
Market and Credit Risk
In the normal course of business each Fund may invest in financial instruments
and enter into financial transactions where risk of potential loss exists due to
changes in the market (market risk) or failure of the other party to the
transaction to perform (credit risk). Similar to credit risk, each Fund may be
exposed to counterparty risk, or the risk that an institution or other entity
with which the Fund has unsettled or open transactions will default. The
potential loss could exceed the value of the financial assets recorded on the
financial statements. Financial assets, which potentially expose each Fund to
credit risk, consist principally of cash due from counterparties on forward,
option and swap transactions. The extent of each Fund's exposure to credit and
counterparty risks in respect to these financial assets approximates their
carrying value as recorded on the Statement of Assets and Liabilities.
Each Fund helps manage credit risk by entering into agreements only with
counterparties Nuveen Asset Management (the "Adviser"), a wholly owned
subsidiary of Nuveen Investments Inc. ("Nuveen") believes have the financial
resources to honor their obligations and by having the Adviser monitor the
financial stability of the counterparties. Additionally, counterparties may be
required to pledge collateral daily (based on the daily valuation of the
financial asset) on behalf of each Fund with a value approximately equal to the
amount of any unrealized gain above a pre-determined threshold. Reciprocally,
when each Fund has an unrealized loss, the Funds have instructed the custodian
to pledge assets of the Funds as collateral with a value approximately equal to
the amount of the unrealized loss above a pre-determined threshold. Collateral
pledges are monitored and subsequently adjusted if and when the valuations
fluctuate, either up or down, by at least the predetermined threshold amount.
59
| Notes to FINANCIAL STATEMENTS (continued)
Zero Coupon Securities
Each Fund is authorized to invest in zero coupon securities. A zero coupon
security does not pay a regular interest coupon to its holders during the life
of the security. Tax-exempt income to the holder of the security comes from
accretion of the difference between the original purchase price of the security
at issuance and the par value of the security at maturity and is effectively
paid at maturity. Such securities are included in the Portfolios of Investments
with a 0.000% coupon rate in their description. The market prices of zero coupon
securities generally are more volatile than the market prices of securities that
pay interest periodically.
Custodian Fee Credit
Each Fund has an arrangement with the custodian bank whereby certain custodian
fees and expenses are reduced by net credits earned on each Fund's cash on
deposit with the bank. Such deposit arrangements are an alternative to overnight
investments. Credits for cash balances may be offset by charges for any days on
which a Fund overdraws its account at the custodian bank.
Indemnifications
Under the Funds' organizational documents, their Officers and Trustees are
indemnified against certain liabilities arising out of the performance of their
duties to the Funds. In addition, in the normal course of business, the Funds
enter into contracts that provide general indemnifications to other parties. The
Funds' maximum exposure under these arrangements is unknown as this would
involve future claims that may be made against the Funds that have not yet
occurred. However, the Funds have not had prior claims or losses pursuant to
these contracts and expect the risk of loss to be remote.
Use of Estimates
The preparation of financial statements in conformity with US generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities at the date of the
financial statements and the reported amounts of increases and decreases in net
assets from operations during the reporting period. Actual results may differ
from those estimates.
2. FAIR VALUE MEASUREMENTS
During the current fiscal period, the Funds adopted the provisions of Statement
of Financial Accounting Standards No. 157 (SFAS No. 157) "Fair Value
Measurements." SFAS No. 157 defines fair value, establishes a framework for
measuring fair value in generally accepted accounting principles, and expands
disclosure about fair value measurements. In determining the value of each
Fund's investments various inputs are used. These inputs are summarized in the
three broad levels listed below:
Level 1 - Quoted prices in active markets for identical securities.
Level 2 - Other significant observable inputs (including quoted prices for
similar securities, interest rates, prepayment speeds, credit
risk, etc.).
Level 3 - Significant unobservable inputs (including management's
assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not an indication of
the risk associated with investing in those securities.
60
The following is a summary of each Fund's fair value measurements as of March
31, 2009:
SELECT TAX-FREE (NXP) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
------------------------------------------------------------------------------------------------------------------------------------
Investments $ 2,333,263 $ 217,073,910 $ -- $ 219,407,173
====================================================================================================================================
SELECT TAX-FREE 2 (NXQ) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
------------------------------------------------------------------------------------------------------------------------------------
Investments $ 389,327 $ 219,661,222 $ -- $ 220,050,549
====================================================================================================================================
SELECT TAX-FREE 3 (NXR) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
------------------------------------------------------------------------------------------------------------------------------------
Investments $ 319,852 $ 171,357,653 $ -- $ 171,677,505
====================================================================================================================================
CALIFORNIA SELECT TAX-FREE (NXC) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
------------------------------------------------------------------------------------------------------------------------------------
Investments $ 295,477 $ 81,880,116 $ -- $ 82,175,593
====================================================================================================================================
NEW YORK SELECT TAX-FREE (NXN) LEVEL 1 LEVEL 2 LEVEL 3 TOTAL
------------------------------------------------------------------------------------------------------------------------------------
Investments $ 1,092,572 $ 51,174,770 $ -- $ 52,267,342
====================================================================================================================================
The following is a reconciliation of NXN's Level 3 investments held at the
beginning and end of the measurement period:
NEW YORK SELECT
TAX-FREE (NXN)
LEVEL 3
INVESTMENTS
------------------------------------------------------------------------------------------------------------------------------------
Balance at beginning of year $ 527,326
Gains (losses):
Net realized gains (losses) --
Net change in unrealized appreciation (depreciation) 122,674
Net purchases at cost (sales at proceeds) (650,000)
Net discounts (premiums) --
Net transfers in to (out of) at end of year fair value --
------------------------------------------------------------------------------------------------------------------------------------
Balance at end of year $ --
====================================================================================================================================
3. FUND SHARES
Share Repurchases
On July 30, 2008, the Funds' Board of Trustees approved a program under which
each Fund may repurchase an aggregate of up to approximately 10% of its
outstanding shares. The Funds did not repurchase any of their shares during the
fiscal year ended March 31, 2009.
Transactions in shares were as follows:
SELECT SELECT SELECT
TAX-FREE (NXP) TAX-FREE 2 (NXQ) TAX-FREE 3 (NXR)
----------------------- ----------------------- -----------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
3/31/09 3/31/08 3/31/09 3/31/08 3/31/09 3/31/08
------------------------------------------------------------------------------------------------------------------------------------
Shares issued to shareholders due to reinvestment of
distributions 37,396 12,459 30,367 -- 14,590 --
====================================================================================================================================
CALIFORNIA SELECT NEW YORK SELECT
TAX-FREE (NXC) TAX-FREE (NXN)
----------------------- -----------------------
YEAR ENDED YEAR ENDED YEAR ENDED YEAR ENDED
3/31/09 3/31/08 3/31/09 3/31/08
------------------------------------------------------------------------------------------------------------------------------------
Shares issued to shareholders due to reinvestment of
distributions 7,322 2,899 797 827
====================================================================================================================================
61
| Notes to FINANCIAL STATEMENTS (continued)
4. INVESTMENT TRANSACTIONS
Purchases and sales (including maturities but excluding short-term investments)
during the fiscal year ended March 31, 2009, were as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Purchases $ 25,240,211 $ 15,591,582 $ 8,862,796 $ 10,133,201 $ 355,191
Sales and maturities 26,124,020 14,559,043 8,949,089 12,512,808 2,079,946
====================================================================================================================================
5. INCOME TAX INFORMATION
The following information is presented on an income tax basis. Differences
between amounts for financial statement and federal income tax purposes are
primarily due to timing differences in recognizing taxable market discount,
timing differences in recognizing certain gains and losses on investment
transactions and the treatment of investments in inverse floating rate
transactions subject to SFAS No. 140, if any. To the extent that differences
arise that are permanent in nature, such amounts are reclassified within the
capital accounts on the Statement of Assets and Liabilities presented in the
annual report, based on their federal tax basis treatment; temporary differences
do not require reclassification. Temporary and permanent differences do not
impact the net asset values of the Funds.
At March 31, 2009, the cost of investments was as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Cost of investments $ 225,627,266 $ 242,027,256 $176,535,869 $ 85,683,703 $ 52,984,815
====================================================================================================================================
Gross unrealized appreciation and gross unrealized depreciation of investments
at March 31, 2009, were as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Gross unrealized:
Appreciation $ 11,918,622 $ 7,913,797 $ 6,803,154 $ 2,795,328 $ 939,716
Depreciation (18,138,715) (29,890,504) (11,661,518) (6,303,438) (2,238,881)
------------------------------------------------------------------------------------------------------------------------------------
Net unrealized appreciation (depreciation) of
investments $ (6,220,093) $ (21,976,707) $ (4,858,364) $ (3,508,110) $ (1,299,165)
====================================================================================================================================
62
The tax components of undistributed net tax-exempt income, net ordinary income
and net long-term capital gains at March 31, 2009, the Funds' tax year end, were
as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Undistributed net tax-exempt income* $ 1,360,903 $ 1,278,567 $ 516,027 $ 342,425 $ 141,820
Undistributed net ordinary income** 259,856 28 -- -- --
Undistributed net long-term capital gains -- -- 12,690 -- --
====================================================================================================================================
* Undistributed net tax-exempt income (on a tax basis) has not been reduced
for the dividend declared on March 3, 2009, paid on April 1, 2009.
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
The tax character of distributions paid during the Funds' tax years ended March
31, 2009 and March 31, 2008, was designated for purposes of the dividends paid
deduction as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
2009 (NXP) (NXQ) (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income*** $ 11,223,919 $ 11,734,961 $ 8,326,795 $ 4,172,291 $ 2,392,786
Distributions from net ordinary income** -- -- -- -- --
Distributions from net long-term capital gains**** -- -- -- -- --
====================================================================================================================================
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
2008 (NXP) (NXQ) (NXR) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Distributions from net tax-exempt income $ 11,212,532 $ 11,198,099 $ 8,322,967 $ 3,980,219 $ 2,392,058
Distributions from net ordinary income** -- -- -- -- --
Distributions from net long-term capital gains -- -- -- 66,849 47,064
====================================================================================================================================
** Net ordinary income consists of taxable market discount income and net
short-term capital gains, if any.
*** The Funds hereby designate these amounts paid during the fiscal year ended
March 31, 2009, as Exempt Interest Dividends.
**** The Funds designated as a long-term capital gain dividend, pursuant to the
Internal Revenue Code Section 852(b)(3), the amount necessary to reduce
earnings and profits of the Funds related to net capital gain to zero for
the tax year ended March 31, 2009.
At March 31, 2009, the Funds' tax year end, the following Funds had unused
capital loss carryforwards available for federal income tax purposes to be
applied against future capital gains, if any. If not applied, the carryforwards
will expire as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Expiration:
March 31, 2015 $ 907,591 $ 1,369,835 $ -- $ --
March 31, 2016 -- 7,597 34,855 40,192
March 31, 2017 -- 400,800 127,842 15,314
------------------------------------------------------------------------------------------------------------------------------------
Total $ 907,591 $ 1,778,232 $ 162,697 $ 55,506
====================================================================================================================================
The following Funds have elected to defer net realized losses from investments
incurred from November 1, 2008 through March 31, 2009, the Funds' tax year end,
("post-October losses") in accordance with federal income tax regulations.
Post-October losses are treated as having arisen on the first day of the
following fiscal year:
CALIFORNIA NEW YORK
SELECT SELECT SELECT
TAX-FREE 2 TAX-FREE TAX-FREE
(NXQ) (NXC) (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Post-October capital losses $ 44,402 $ 697,221 $ 3,303
====================================================================================================================================
63
| Notes to FINANCIAL STATEMENTS (continued)
6. MANAGEMENT FEES AND OTHER TRANSACTIONS WITH AFFILIATES
Each Fund's management fee is separated into two components - a complex-level
component, based on the aggregate amount of all fund assets managed by the
Adviser, and a specific fund-level component, based only on the amount of assets
within each individual Fund. This pricing structure enables Nuveen fund
shareholders to benefit from growth in the assets within each individual fund as
well as from growth in the amount of complex-wide assets managed by the Adviser.
The annual fund-level fee, payable monthly, for each Fund is based upon the
average daily net assets of each Fund as follows:
SELECT TAX-FREE 2 (NXQ)
SELECT TAX-FREE 3 (NXR)
CALIFORNIA SELECT TAX-FREE (NXC)
SELECT TAX-FREE (NXP) NEW YORK SELECT TAX-FREE (NXN)
AVERAGE DAILY NET ASSETS FUND-LEVEL FEE RATE FUND-LEVEL FEE RATE
------------------------------------------------------------------------------------
For the first $125 million .0500% .1000%
For the next $125 million .0375 .0875
For the next $250 million .0250 .0750
For the next $500 million .0125 .0625
====================================================================================
The annual complex-level fee, payable monthly, which is additive to the
fund-level fee, for all Nuveen sponsored funds in the U.S., is based on the
aggregate amount of total fund assets managed as stated in the following table.
As of March 31, 2009, the complex-level fee rate was .2000%.
The complex-level fee schedule is as follows:
COMPLEX-LEVEL ASSET BREAKPOINT LEVEL (1) EFFECTIVE RATE AT BREAKPOINT LEVEL
------------------------------------------------------------------------------------
$55 billion .2000%
$56 billion .1996
$57 billion .1989
$60 billion .1961
$63 billion .1931
$66 billion .1900
$71 billion .1851
$76 billion .1806
$80 billion .1773
$91 billion .1691
$125 billion .1599
$200 billion .1505
$250 billion .1469
$300 billion .1445
====================================================================================
(1) The complex-level fee component of the management fee for the funds is
calculated based upon the aggregate daily managed assets of all Nuveen
funds, with such daily managed assets defined separately for each fund in
its management agreement, but which generally includes assets attributable
to preferred stock issued by or borrowings (including the issuance of
commercial paper or notes) by such fund, but excludes assets attributable
to investments in other Nuveen funds.
64
The management fee compensates the Adviser for overall investment advisory and
administrative services and general office facilities. The Funds pay no
compensation directly to those of its Trustees who are affiliated with the
Adviser or to its Officers, all of whom receive remuneration for their services
to the Funds from the Adviser or its affiliates. The Board of Trustees has
adopted a deferred compensation plan for independent Trustees that enables
Trustees to elect to defer receipt of all or a portion of the annual
compensation they are entitled to receive from certain Nuveen advised funds.
Under the plan, deferred amounts are treated as though equal dollar amounts had
been invested in shares of select Nuveen advised funds.
7. NEW ACCOUNTING PRONOUNCEMENTS
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 161 (SFAS No. 161)
In March 2008, the FASB issued SFAS No. 161, "Disclosures about Derivative
Instruments and Hedging Activities." This standard is intended to enhance
financial statement disclosures for derivative instruments and hedging
activities and enable investors to understand: a) how and why a fund uses
derivative instruments, b) how derivative instruments and related hedge items
are accounted for, and c) how derivative instruments and related hedge items
affect a fund's financial position, results of operations and cash flows. SFAS
No. 161 is effective for financial statements issued for fiscal years and
interim periods beginning after November 15, 2008. As of March 31, 2009,
management does not believe the adoption of SFAS No. 161 will impact the
financial statement amounts; however, additional footnote disclosures may be
required about the use of derivative instruments and hedging items.
Financial Accounting Standards Board Staff Position No. 157-4 (FSP No. 157-4)
On April 9, 2009, the Financial Accounting Standards Board issued FSP No. 157-4,
"Determining Fair Value When the Volume and Level of Activity for the Asset or
Liability Have Significantly Decreased and Identifying Transactions That Are Not
Orderly." FSP No. 157-4 provides additional guidance for estimating fair value
in accordance with SFAS No. 157, "Fair Value Measurements," when the volume and
level of activity for the asset or liability have significantly decreased. FSP
No. 157-4 also requires additional disaggregation of the current SFAS No. 157
required disclosures. FSP No. 157-4 is effective for interim and annual
reporting periods ending after June 15, 2009, and shall be applied
prospectively. At this time, management is evaluating the implications of FSP
No. 157-4 and the impact it will have on the financial statement disclosures.
8. SUBSEQUENT EVENTS
Distributions to Shareholders
The Funds declared dividend distributions from their tax-exempt net investment
income which were paid on May 1, 2009, to shareholders of record on April 15,
2009, as follows:
CALIFORNIA NEW YORK
SELECT SELECT SELECT SELECT SELECT
TAX-FREE TAX-FREE 2 TAX-FREE 3 TAX-FREE TAX-FREE
(NXP) (NXQ) (NXR) (NXC) (NXN)
--------------------------------------------------------------------------------
Dividend per share $ .0570 $ .0555 $ .0535 $ .0555 $ .0510
================================================================================
65
| Financial HIGHLIGHTS
Selected data for a share outstanding throughout each period:
Investment Operations Less Distributions
----------------------------------- --------------------------------
Net Ending
Beginning Net Realized/ Net Net Ending
Net Asset Investment Unrealized Investment Capital Asset Market
Value Income Gain (Loss) Total Income Gains Total Value Value
------------------------------------------------------------------------------------------------------------------------------------
SELECT TAX-FREE (NXP)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 $ 14.30 $ .71 $ (.81) $ (.10) $ (.68) $ -- $ (.68) $ 13.52 $ 13.67
2008 14.72 .70 (.44) .26 (.68) -- (.68) 14.30 14.24
2007 14.62 .70 .08 .78 (.68) -- (.68) 14.72 14.85
2006 14.62 .70 (.02) .68 (.68) -- (.68) 14.62 14.21
2005 14.85 .70 (.12) .58 (.71) (.10) (.81) 14.62 13.50
SELECT TAX-FREE 2 (NXQ)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 13.93 .67 (1.30) (.63) (.67) -- (.67) 12.63 13.14
2008 14.60 .66 (.69) (.03) (.64) -- (.64) 13.93 13.79
2007 14.44 .66 .14 .80 (.64) -- (.64) 14.60 14.07
2006 14.38 .66 .06 .72 (.65) (.01) (.66) 14.44 13.37
2005 14.56 .67 (.13) .54 (.68) (.04) (.72) 14.38 13.08
====================================================================================================================================
66
Ratios/Supplemental Data
---------------------------------------------------
Ratios to Average Net Assets
Total Returns Before Credit
------------------- --------------------------------------
Based on Ending
Based on Net Net Expenses Expenses Net
Market Asset Assets Including Excluding Investment
Value* Value* (000) Interest(a) Interest(a) Income
---------------------------------------------------------------------------------------------------
SELECT TAX-FREE (NXP)
---------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 .89% (.65)% $ 222,114 .33% .33% 5.12%
2008 .61 1.83 234,494 .32 .32 4.83
2007 9.59 5.48 241,074 .31 .31 4.77
2006 10.41 4.74 239,406 .32 .32 4.72
2005 .17 4.00 239,460 .33 .33 4.76
SELECT TAX-FREE 2 (NXQ)
---------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 .24 (4.63) 222,771 .39 .38 5.08
2008 2.69 (.24) 245,244 .40 .36 4.58
2007 10.21 5.62 257,037 .37 .36 4.50
2006 7.39 5.12 254,205 .36 .36 4.51
2005 .11 3.82 253,158 .37 .37 4.68
===================================================================================================
Ratios/Supplemental Data
--------------------------------------------------
Ratios to Average Net Assets
After Credit**
--------------------------------------
Expenses Expenses Net Portfolio
Including Excluding Investment Turnover
Interest(a) Interest(a) Income Rate
----------------------------------------------------------------------------------------------------
SELECT TAX-FREE (NXP)
----------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 .33% .33% 5.12% 11%
2008 .31 .31 4.83 4
2007 .30 .30 4.78 2
2006 .31 .31 4.73 4
2005 .32 .32 4.77 11
SELECT TAX-FREE 2 (NXQ)
----------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 .39 .38 5.09 6
2008 .38 .34 4.60 7
2007 .36 .35 4.51 3
2006 .35 .35 4.52 11
2005 .36 .36 4.69 13
====================================================================================================
* Total Return Based on Market Value is the combination of changes in the
market price per share and the effect of reinvested dividend income and
reinvested capital gains distributions, if any, at the average price paid
per share at the time of reinvestment. The last dividend declared in the
period, which is typically paid on the first business day of the following
month, is assumed to be reinvested at the ending market price. The actual
reinvestment for the last dividend declared in the period may take place
over several days, and in some instances may not be based on the market
price, so the actual reinvestment price may be different from the price
used in the calculation. Total returns are not annualized.
Total Return Based on Net Asset Value is the combination of changes in net
asset value, reinvested dividend income at net asset value and reinvested
capital gains distributions at net asset value, if any. The last dividend
declared in the period, which is typically paid on the first business day
of the following month, is assumed to be reinvested at the ending net
asset value. The actual reinvest price for the last dividend declared in
the period may often be based on the Fund's market price (and not its net
asset value), and therefore may be different from the price used in the
calculation. Total returns are not annualized.
** After custodian fee credit, where applicable.
(a) Interest expense arises from the application of SFAS No. 140 to certain
inverse floating rate transactions entered into by the Fund as more fully
described in Footnote 1 - Inverse Floating Rate Securities.
See accompanying notes to financial statements.
67
| Financial HIGHLIGHTS (continued)
Selected data for a share outstanding throughout each period:
Investment Operations Less Distributions
------------------------------- -----------------------------
Net Ending
Beginning Net Realized/ Net Net Ending
Net Asset Investment Unrealized Investment Capital Asset Market
Value Income Gain (Loss) Total Income Gains Total Value Value
------------------------------------------------------------------------------------------------------------------------------------
SELECT TAX-FREE 3 (NXR)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 $ 13.98 $ .66 $ (.62) $ .04 $ (.64) $ -- $ (.64) $ 13.38 $ 13.57
2008 14.42 .64 (.44) .20 (.64) -- (.64) 13.98 13.75
2007 14.29 .64 .13 .77 (.64) -- (.64) 14.42 14.01
2006 14.22 .65 .06 .71 (.64) -- (.64) 14.29 13.45
2005 14.37 .66 (.11) .55 (.67) (.03) (.70) 14.22 12.82
CALIFORNIA SELECT TAX-FREE (NXC)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 14.09 .66 (.84) (.18) (.67) -- (.67) 13.24 12.00
2008 14.73 .66 (.65) .01 (.64) (.01) (.65) 14.09 14.08
2007 14.57 .64 .18 .82 (.64) (.02) (.66) 14.73 14.22
2006 14.54 .65 .09 .74 (.65) (.06) (.71) 14.57 13.56
2005 14.68 .66 (.09) .57 (.66) (.05) (.71) 14.54 13.40
====================================================================================================================================
68
Ratios/Supplemental Data
----------------------------------------------------
Ratios to Average Net Assets
Total Returns Before Credit
------------------- --------------------------------------
Based on Ending
Based on Net Net Expenses Expenses Net
Market Asset Assets Including Excluding Investment
Value* Value* (000) Interest(a) Interest(a) Income
-------------------------------------------------------------------------------------------------------------
SELECT TAX-FREE 3 (NXR)
-------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 3.51% .34% $ 173,678 .39% .39% 4.83%
2008 2.91 1.42 181,288 .38 .36 4.49
2007 9.15 5.51 186,969 .38 .37 4.43
2006 10.12 5.10 185,233 .37 .37 4.51
2005 (.17) 4.01 184,379 .38 .38 4.66
CALIFORNIA SELECT TAX-FREE (NXC)
-------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 (10.34) (1.30) 82,953 .43 .41 4.85
2008 3.68 .05 88,224 .44 .38 4.52
2007 9.89 5.72 92,177 .40 .39 4.37
2006 6.52 5.17 91,152 .38 .38 4.42
2005 .50 3.99 90,949 .39 .39 4.55
=============================================================================================================
Ratios/Supplemental Data
--------------------------------------------------
Ratios to Average Net Assets
After Credit**
--------------------------------------
Expenses Expenses Net Portfolio
Including Excluding Investment Turnover
Interest(a) Interest(a) Income Rate
-------------------------------------------------------------------------------------------------------------
SELECT TAX-FREE 3 (NXR)
-------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 .39% .39% 4.83% 5%
2008 .36 .35 4.50 2
2007 .36 .35 4.45 9
2006 .35 .35 4.52 6
2005 .37 .37 4.67 16
CALIFORNIA SELECT TAX-FREE (NXC)
-------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 .42 .40 4.86 12
2008 .43 .37 4.53 8
2007 .39 .38 4.38 16
2006 .37 .37 4.43 8
2005 .39 .39 4.56 13
=============================================================================================================
* Total Return Based on Market Value is the combination of changes in the
market price per share and the effect of reinvested dividend income and
reinvested capital gains distributions, if any, at the average price paid
per share at the time of reinvestment. The last dividend declared in the
period, which is typically paid on the first business day of the following
month, is assumed to be reinvested at the ending market price. The actual
reinvestment for the last dividend declared in the period may take place
over several days, and in some instances may not be based on the market
price, so the actual reinvestment price may be different from the price
used in the calculation. Total returns are not annualized.
Total Return Based on Net Asset Value is the combination of changes in net
asset value, reinvested dividend income at net asset value and reinvested
capital gains distributions at net asset value, if any. The last dividend
declared in the period, which is typically paid on the first business day
of the following month, is assumed to be reinvested at the ending net
asset value. The actual reinvest price for the last dividend declared in
the period may often be based on the Fund's market price (and not its net
asset value), and therefore may be different from the price used in the
calculation. Total returns are not annualized.
** After custodian fee credit, where applicable.
(a) Interest expense arises from the application of SFAS No. 140 to certain
inverse floating rate transactions entered into by the Fund as more fully
described in Footnote 1 - Inverse Floating Rate Securities.
See accompanying notes to financial statements.
69
| Financial HIGHLIGHTS (continued)
Selected data for a share outstanding throughout each period:
Investment Operations Less Distributions
------------------------------- -----------------------------
Net Ending
Beginning Net Realized/ Net Net Ending
Net Asset Investment Unrealized Investment Capital Asset Market
Value Income Gain (Loss) Total Income Gains Total Value Value
------------------------------------------------------------------------------------------------------------------------------------
NEW YORK SELECT TAX-FREE (NXN)
------------------------------------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 $ 13.79 $ .62 $ (.43) $ .19 $ (.61) $ -- $ (.61) $ 13.37 $ 13.08
2008 14.28 .62 (.49) .13 (.61) (.01) (.62) 13.79 13.79
2007 14.19 .61 .13 .74 (.61) (.04) (.65) 14.28 14.15
2006 14.28 .62 (.02) .60 (.62) (.07) (.69) 14.19 13.35
2005 14.57 .64 (.21) .43 (.66) (.06) (.72) 14.28 13.65
====================================================================================================================================
70
Ratios/Supplemental Data
--------------------------------------------------
Ratios to Average Net Assets
Total Returns Before Credit
------------------- --------------------------------------
Based on Ending
Based on Net Net Expenses Expenses Net
Market Asset Assets Including Excluding Investment
Value* Value* (000) Interest(a) Interest(a) Income
---------------------------------------------------------------------------------------------------------
NEW YORK SELECT TAX-FREE (NXN)
---------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 (.57)% 1.47% $ 52,268 .47% .45% 4.57%
2008 2.06 .94 53,908 .46 .43 4.35
2007 11.15 5.30 55,828 .46 .42 4.29
2006 2.84 4.19 55,473 .41 .41 4.28
2005 .05 3.10 55,817 .41 .41 4.48
=========================================================================================================
Ratios/Supplemental Data
--------------------------------------------------
Ratios to Average Net Assets
After Credit**
--------------------------------------
Expenses Expenses Net Portfolio
Including Excluding Investment Turnover
Interest(a) Interest(a) Income Rate
----------------------------------------------------------------------------------------------------------
NEW YORK SELECT TAX-FREE (NXN)
----------------------------------------------------------------------------------------------------------
Year Ended 3/31:
2009 .47% .44% 4.57% 1%
2008 .44 .41 4.37 20
2007 .45 .41 4.30 6
2006 .40 .40 4.29 13
2005 .41 .41 4.48 13
==========================================================================================================
* Total Return Based on Market Value is the combination of changes in the
market price per share and the effect of reinvested dividend income and
reinvested capital gains distributions, if any, at the average price paid
per share at the time of reinvestment. The last dividend declared in the
period, which is typically paid on the first business day of the following
month, is assumed to be reinvested at the ending market price. The actual
reinvestment for the last dividend declared in the period may take place
over several days, and in some instances may not be based on the market
price, so the actual reinvestment price may be different from the price
used in the calculation. Total returns are not annualized.
Total Return Based on Net Asset Value is the combination of changes in net
asset value, reinvested dividend income at net asset value and reinvested
capital gains distributions at net asset value, if any. The last dividend
declared in the period, which is typically paid on the first business day
of the following month, is assumed to be reinvested at the ending net
asset value. The actual reinvest price for the last dividend declared in
the period may often be based on the Fund's market price (and not its net
asset value), and therefore may be different from the price used in the
calculation. Total returns are not annualized.
** After custodian fee credit, where applicable.
(a) Interest expense arises from the application of SFAS No. 140 to certain
inverse floating rate transactions entered into by the Fund as more fully
described in Footnote 1 - Inverse Floating Rate Securities.
See accompanying notes to financial statements.
71
Board Members & Officers
The management of the Funds, including general supervision of the duties
performed for the Funds by the Adviser, is the responsibility of the Board
Members of the Funds. The number of board members of the Fund is currently set
at nine. None of the board members who are not "interested" persons of the Funds
(referred to herein as "independent board members") has ever been a director or
employee of, or consultant to, Nuveen or its affiliates. The names and business
addresses of the board members and officers of the Funds, their principal
occupations and other affiliations during the past five years, the number of
portfolios each oversees and other directorships they hold are set forth below.
NUMBER PRINCIPAL
YEAR FIRST OF PORTFOLIOS OCCUPATION(S)
NAME, ELECTED OR IN FUND COMPLEX INCLUDING OTHER
BIRTHDATE POSITION(S) HELD APPOINTED OVERSEEN BY DIRECTORSHIPS
& ADDRESS WITH THE FUNDS AND TERM(1) BOARD MEMBER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS:
o ROBERT P. BREMNER Private Investor and Management Consultant;
8/22/40 Chairman of Treasurer and Director, Humanities Council of
333 W. Wacker Drive the Board 1997 199 Washington D.C.
Chicago, IL 60606 and Board Member
o JACK B. EVANS President, The Hall-Perrine Foundation, a
10/22/48 private philanthropic corporation (since
333 W. Wacker Drive Board Member 1999 199 1996); Director and Vice Chairman, United
Chicago, IL 60606 Fire Group, a publicly held company; Member
of the Board of Regents for the State of Iowa
University System; Director, Gazette
Companies; Life Trustee of Coe College;
Director, Iowa College Foundation; Member of
the Advisory Council of the Department of
Finance in the Tippie College of Business,
University of Iowa; formerly, Director,
Alliant Energy; formerly, Director, Federal
Reserve Bank of Chicago; formerly, President
and Chief Operating Officer, SCI Financial
Group, Inc., a regional financial services
firm.
o WILLIAM C. HUNTER Dean, Tippie College of Business, University
3/6/48 of Iowa (since July 2006); Director (since
333 W. Wacker Drive Board Member 2004 199 2004) of Xerox Corporation; Director (since
Chicago, IL 60606 2005), Beta Gamma Sigma International Honor
Society; formerly, Dean and Distinguished
Professor of Finance, School of Business at
the University of Connecticut (2003-2006);
previously, Senior Vice President and
Director of Research at the Federal Reserve
Bank of Chicago (1995-2003); Director, SS&C
Technologies, Inc. (May 2005-October 2005);
formerly, Director (1997-2007), Credit
Research Center at Georgetown University.
o DAVID J. KUNDERT Director, Northwestern Mutual Wealth
10/28/42 Management Company; Retired (since 2004) as
333 W. Wacker Drive Board Member 2005 199 Chairman, JPMorgan Fleming Asset Management,
Chicago, IL 60606 President and CEO, Banc One Investment
Advisors Corporation, and President, One
Group Mutual Funds; prior thereto, Executive
Vice President, Banc One Corporation and
Chairman and CEO, Banc One Investment
Management Group; Member, Board of Regents,
Luther College; member of the Wisconsin Bar
Association; member of Board of Directors,
Friends of Boerner Botanical Gardens; member
of Investment Committee, Greater Milwaukee
Foundation.
o WILLIAM J. SCHNEIDER Chairman of Miller-Valentine Partners Ltd., a
9/24/44 real estate investment company; formerly,
333 W. Wacker Drive Board Member 1997 199 Senior Partner and Chief Operating Officer
Chicago, IL 60606 (retired, 2004) of Miller-Valentine Group;
member, University of Dayton Business School
Advisory Council; member, Dayton Philharmonic
Orchestra Association; formerly, member,
Business Advisory Council, Cleveland Federal
Reserve Bank; formerly, Director, Dayton
Development Coalition.
72
NUMBER PRINCIPAL
YEAR FIRST OF PORTFOLIOS OCCUPATION(S)
NAME, ELECTED OR IN FUND COMPLEX INCLUDING OTHER
BIRTHDATE POSITION(S) HELD APPOINTED OVERSEEN BY DIRECTORSHIPS
& ADDRESS WITH THE FUNDS AND TERM(1) BOARD MEMBER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
INDEPENDENT BOARD MEMBERS:
o JUDITH M. STOCKDALE Executive Director, Gaylord and Dorothy
12/29/47 Donnelley Foundation (since 1994); prior
333 W. Wacker Drive Board Member 1997 199 thereto, Executive Director, Great Lakes
Chicago, IL 60606 Protection Fund (from 1990 to 1994).
o CAROLE E. STONE Director, Chicago Board Options Exchange
6/28/47 (since 2006); Commissioner, New York State
333 W. Wacker Drive Board Member 2007 199 Commission on Public Authority Reform (since
Chicago, IL 60606 2005); formerly, Chair New York Racing
Association Oversight Board (2005-2007).
o TERENCE J. TOTH Director, Legal & General Investment
9/29/59 Management America, Inc. (since 2008);
333 W. Wacker Drive Board Member 2008 199 Managing Partner, Musso Capital Management
Chicago, IL 60606 (since 2008); Private Investor (since 2007);
CEO and President, Northern Trust Investments
(2004-2007); Executive Vice President,
Quantitative Management & Securities Lending
(2004-2007); prior thereto, various positions
with Northern Trust Company (since 1994);
Member: Goodman Theatre Board (since 2004),
Chicago Fellowship Boards (since 2005),
University of Illinois Leadership Council
Board (since 2007) and Catalyst Schools of
Chicago Board (since 2008); formerly, Member:
Northern Trust Mutual Funds Board
(2005-2007), Northern Trust Investments Board
(2004-2007), Northern Trust Japan Board
(2004-2007), Northern Trust Securities Inc.
Board (2003-2007) and Northern Trust Hong
Kong Board (1997-2004).
INTERESTED BOARD MEMBER:
o JOHN P. AMBOIAN(2) Chief Executive Officer (since July 2007) and
6/14/61 Director (since 1999) of Nuveen Investments,
333 W. Wacker Drive Board Member 2008 199 Inc.; Chief Executive Officer (since 2007) of
Chicago, IL 60606 Nuveen Asset Management, Rittenhouse Asset
Management, Nuveen Investments Advisors, Inc.
formerly, President (1999-2004) of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp.(3)
73
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
o GIFFORD R. ZIMMERMAN Managing Director (since 2002), Assistant
9/9/56 Chief Secretary and Associate General Counsel of
333 W. Wacker Drive Administrative 1988 199 Nuveen Investments, LLC; Managing Director,
Chicago, IL 60606 Officer Associate General Counsel and Assistant
Secretary, of Nuveen Asset Management and of
Symphony Asset Management LLC, (since 2003);
Vice President and Assistant Secretary of NWQ
Investment Management Company, LLC. (since
2002), Nuveen Investments Advisers Inc.
(since 2002), Tradewinds Global Investors,
LLC, and Santa Barbara Asset Management, LLC
(since 2006), Nuveen HydePark Group LLC and
Nuveen Investment Solutions, Inc. (since
2007); Managing Director (since 2004) and
Assistant Secretary (since 1994) of Nuveen
Investments, Inc.; formerly, Managing
Director (2002- 2004), General Counsel
(1998-2004) and Assistant Secretary of Nuveen
Advisory Corp. and Nuveen Institutional
Advisory Corp.(3); Chartered Financial
Analyst.
o WILLIAM ADAMS IV Executive Vice President of Nuveen
6/9/55 Investments, Inc.; Executive Vice President,
333 W. Wacker Drive Vice President 2007 125 U.S. Structured Products of Nuveen
Chicago, IL 60606 Investments, LLC, (since 1999), prior
thereto, Managing Director of Structured
Investments.
o MARK J.P. ANSON President and Executive Director of Nuveen
6/10/59 Investments, Inc. (since 2007); President of
333 W. Wacker Drive Vice President 2009 199 Nuveen Investments Institutional Services
Chicago, IL 60606 Group LLC (since 2007); previously, Chief
Executive Officer of the British Telecom
Pension Scheme (2006-2007) and Chief
Investment Officer of Calpers (1999-2006);
PhD, Chartered Financial Analyst, Chartered
Alternative Investment Analyst, Certified
Public Accountant, Certified Management
Accountant and Certified Internal Auditor.
o CEDRIC H. ANTOSIEWICZ Managing Director, (since 2004), previously,
1/11/62 Vice President (1993-2004) of Nuveen
333 W. Wacker Drive Vice President 2007 125 Investments, LLC.
Chicago, IL 60606
o NIZIDA ARRIAGA Vice President (since 2007) of Nuveen
6/1/68 Investments, LLC; previously, Portfolio
333 W. Wacker Drive Vice President 2009 199 Manager, Allstate Investments, LLC
Chicago, IL 60606 (1996-2006); Chartered Financial Analyst.
o MICHAEL T. ATKINSON Vice President (since 2002) of Nuveen
2/3/66 Vice President Investments, LLC.; Vice President of Nuveen
333 W. Wacker Drive and Assistant 2000 199 Asset Management (since 2005).
Chicago, IL 60606 Secretary
o MARGO L. COOK Executive Vice President (since Oct 2008) of
4/11/64 Nuveen Investments, Inc.; previously, Head of
333 W. Wacker Drive Vice President 2009 199 Institutional Asset Management (2007-2008) of
Chicago, IL 60606 Bear Stearns Asset Management; Head of
Institutional Asset Mgt (1986-2007) of Bank
of NY Mellon; Chartered Financial Analyst.
o LORNA C. FERGUSON Managing Director (since 2004), formerly,
10/24/45 Vice President of Nuveen Investments, LLC;
333 W. Wacker Drive Vice President 1998 199 Managing Director (since 2005) of Nuveen
Chicago, IL 60606 Asset Management; Managing Director
(2004-2005), formerly, Vice President
(1998-2004) of Nuveen Advisory Corp. and
Nuveen Institutional Advisory Corp.(3)
74
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
o STEPHEN D. FOY Vice President (since 1993) and Funds
5/31/54 Vice President Controller (since 1998) of Nuveen
333 W. Wacker Drive and Controller 1998 199 Investments, LLC; Vice President (since 2005)
Chicago, IL 60606 of Nuveen Asset Management; Certified Public
Accountant.
o WILLIAM T. HUFFMAN Chief Operating Officer, Municipal Fixed
5/7/69 Income (since 2008) of Nuveen Asset
333 W. Wacker Drive Vice President 2009 199 Management; previously, Chairman, President
Chicago, IL 60606 and Chief Executive Officer (2002 - 2007) of
Northern Trust Global Advisors, Inc. and
Chief Executive Officer (2007) of Northern
Trust Global Investments Limited; CPA.
o WALTER M. KELLY Senior Vice President (since 2008), Vice
2/24/70 Chief Compliance President (2006-2008) formerly, Assistant
333 W. Wacker Drive Officer and 2003 199 Vice President and Assistant General Counsel
Chicago, IL 60606 Vice President (2003-2006) of Nuveen Investments, LLC; Vice
President (since 2006) and Assistant
Secretary (since 2008) of Nuveen Asset
Management.
o DAVID J. LAMB Senior Vice President (since 2009), formerly,
3/22/63 Vice President (2000-2009) of Nuveen
333 W. Wacker Drive Vice President 2000 199 Investments, LLC; Vice President (since 2005)
Chicago, IL 60606 of Nuveen Asset Management; Certified Public
Accountant.
o TINA M. LAZAR Senior Vice President (since 2009), formerly,
8/27/61 Vice President of Nuveen Investments, LLC
333 W. Wacker Drive Vice President 2002 199 (1999-2009); Vice President of Nuveen Asset
Chicago, IL 60606 Management (since 2005).
o LARRY W. MARTIN Vice President, Assistant Secretary and
7/27/51 Vice President Assistant General Counsel of Nuveen
333 W. Wacker Drive and Assistant 1988 199 Investments, LLC; Vice President (since 2005)
Chicago, IL 60606 Secretary and Assistant Secretary of Nuveen
Investments, Inc.; Vice President (since
2005) and Assistant Secretary (since 1997) of
Nuveen Asset Management; Vice President and
Assistant Secretary of Nuveen Investments
Advisers Inc. (since 2002); NWQ Investment
Management Company, LLC (since 2002),
Symphony Asset Management LLC (since 2003),
Tradewinds Global Investors, LLC, Santa
Barbara Asset Management LLC (since 2006) and
of Nuveen HydePark Group, LLC and Nuveen
Investment Solutions, Inc. (since 2007);
formerly, Vice President and Assistant
Secretary of Nuveen Advisory Corp. and Nuveen
Institutional Advisory Corp.(3)
o KEVIN J. MCCARTHY Managing Director (since 2008), formerly,
3/26/66 Vice President Vice President (2007-2008), Nuveen
333 W. Wacker Drive and Secretary 2007 199 Investments, LLC; Managing Director (since
Chicago, IL 60606 2008), formerly, Vice President, and
Assistant Secretary, Nuveen Asset Management,
and Nuveen Investments Holdings, Inc.; Vice
President (since 2007) and Assistant
Secretary, Nuveen Investment Advisers Inc.,
Nuveen Investment Institutional Services
Group LLC, NWQ Investment Management Company,
LLC, Tradewinds Global Investors LLC, NWQ
Holdings, LLC, Symphony Asset Management LLC,
Santa Barbara Asset Management LLC, Nuveen
HydePark Group, LLC and Nuveen Investment
Solutions, Inc. (since 2007); prior thereto,
Partner, Bell, Boyd & Lloyd LLP (1997-2007).
75
NUMBER
OF PORTFOLIOS
NAME, YEAR FIRST IN FUND COMPLEX PRINCIPAL
BIRTHDATE POSITION(S) HELD ELECTED OR OVERSEEN OCCUPATION(S)
AND ADDRESS WITH THE FUNDS APPOINTED(4) BY OFFICER DURING PAST 5 YEARS
------------------------------------------------------------------------------------------------------------------------------------
OFFICERS OF THE FUNDS:
o JOHN V. MILLER Managing Director (since 2007), formerly,
4/10/67 Vice President 2007 199 Vice President (2002-2007) of Nuveen Asset
333 W. Wacker Drive Management and Nuveen Investments, LLC;
Chicago, IL 60606 Chartered Financial Analyst.
o GREGORY MINO Vice President of Nuveen Investments, LLC
1/4/71 Vice President 2009 199 (since 2008); previously, Director
333 W. Wacker Drive (2004-2007) and Executive Director
Chicago, IL 60606 (2007-2008) of UBS Global Asset Management;
previously, Vice President (2000-2003) and
Director (2003-2004) of Merrill Lynch
Investment Managers; Chartered Financial
Analyst.
o CHRISTOPHER M. Vice President, Nuveen Investments, LLC
ROHRBACHER (since 2008); Vice President and Assistant
8/1/71 Vice President Secretary, Nuveen Asset Management (since
333 W. Wacker Drive and Assistant 2008 199 2008); prior thereto, Associate, Skadden,
Chicago, IL 60606 Secretary Arps, Slate Meagher & Flom LLP (2002-2008).
o JAMES F. RUANE Vice President, Nuveen Investments, LLC
7/3/62 Vice President (since 2007); prior thereto, Partner,
333 W. Wacker Drive and Assistant 2007 199 Deloitte & Touche USA LLP (2005-2007),
Chicago, IL 60606 Secretary formerly, senior tax manager (2002-2005);
Certified Public Accountant.
o MARK L. WINGET Vice President, Nuveen Investments, LLC
12/21/68 Vice President (since 2008); Vice President and Assistant
333 W. Wacker Drive and Assistant 2008 199 Secretary, Nuveen Asset Management (since
Chicago, IL 60606 Secretary 2008); prior thereto, Counsel, Vedder Price
P.C. (1997-2007).
(1) Board Members serve three year terms. The Board of Trustees is divided
into three classes, Class I, Class II, and Class III, with each being
elected to serve until the third succeeding annual shareholders' meeting
subsequent to its election or thereafter in each case when its respective
successors are duly elected or appointed. The first year elected or
appointed represents the year in which the board member was first elected
or appointed to any fund in the Nuveen Complex.
(2) Mr. Amboian is an interested trustee because of his position with Nuveen
Investments, Inc. and certain of its subsidiaries, which are affiliates of
the Nuveen Funds.
(3) Nuveen Advisory Corp. and Nuveen Institutional Advisory Corp. were
reorganized into Nuveen Asset Management, effective January 1, 2005.
(4) Officers serve one year terms through July of each year. The year first
elected or appointed represents the year in which the Officer was first
elected or appointed to any fund in the Nuveen Complex.
76
Reinvest Automatically EASILY and CONVENIENTLY
NUVEEN MAKES REINVESTING EASY. A PHONE CALL IS ALL IT TAKES TO SET UP YOUR
REINVESTMENT ACCOUNT.
NUVEEN CLOSED-END FUNDS DIVIDEND REINVESTMENT PLAN
Your Nuveen Closed-End Fund allows you to conveniently reinvest dividends and/or
capital gains distributions in additional Fund shares.
By choosing to reinvest, you'll be able to invest money regularly and
automatically, and watch your investment grow through the power of tax-free
compounding. Just like dividends or distributions in cash, there may be times
when income or capital gains taxes may be payable on dividends or distributions
that are reinvested.
It is important to note that an automatic reinvestment plan does not ensure a
profit, nor does it protect you against loss in a declining market.
EASY AND CONVENIENT
To make recordkeeping easy and convenient, each month you'll receive a statement
showing your total dividends and distributions, the date of investment, the
shares acquired and the price per share, and the total number of shares you own.
HOW SHARES ARE PURCHASED
The shares you acquire by reinvesting will either be purchased on the open
market or newly issued by the Fund. If the shares are trading at or above net
asset value at the time of valuation, the Fund will issue new shares at the
greater of the net asset value or 95% of the then-current market price. If the
shares are trading at less than net asset value, shares for your account will be
purchased on the open market. If the Plan Agent begins purchasing Fund shares on
the open market while shares are trading below net asset value, but the Fund's
shares subsequently trade at or above their net asset value before the Plan
Agent is able to complete its purchases, the Plan Agent may cease open-market
purchases and may invest the uninvested portion of the distribution in
newly-issued Fund shares at a price equal to the greater of the shares' net
asset value or 95% of the shares' market value on the last business day
immediately prior to the purchase date. Dividends and distributions received to
purchase shares in the open market will normally be invested shortly after the
dividend payment date. No interest will be paid on dividends and distributions
awaiting reinvestment. Because the market price of the shares may increase
before purchases are completed, the average purchase price per share may exceed
the market price at the time of valuation, resulting in the acquisition of fewer
shares than if the dividend or distribution had been paid in shares issued by
the Fund. A pro rata portion of any applicable brokerage commissions on open
market purchases will be paid by Plan participants. These commissions usually
will be lower than those charged on individual transactions.
77
FLEXIBLE
You may change your distribution option or withdraw from the Plan at any time,
should your needs or situation change. Should you withdraw, you can receive a
certificate for all whole shares credited to your reinvestment account and cash
payment for fractional shares, or cash payment for all reinvestment account
shares, less brokerage commissions and a $2.50 service fee.
You can reinvest whether your shares are registered in your name, or in the name
of a brokerage firm, bank, or other nominee. Ask your investment advisor if his
or her firm will participate on your behalf. Participants whose shares are
registered in the name of one firm may not be able to transfer the shares to
another firm and continue to participate in the Plan.
The Fund reserves the right to amend or terminate the Plan at any time. Although
the Fund reserves the right to amend the Plan to include a service charge
payable by the participants, there is no direct service charge to participants
in the Plan at this time.
CALL TODAY TO START REINVESTING DIVIDENDS AND/OR DISTRIBUTIONS
For more information on the Nuveen Automatic Reinvestment Plan or to enroll in
or withdraw from the Plan, speak with your financial advisor or call us at (800)
257-8787.
78
Glossary of TERMS USED in this REPORT
o AUCTION RATE BOND: An auction rate bond is a security whose interest
payments are adjusted periodically through an auction process, which
process typically also serves as a means for buying and selling the bond.
Auctions that fail to attract enough buyers for all the shares offered for
sale are deemed to have "failed", with current holders receiving a
formula-based interest rate until the next scheduled auction.
o AVERAGE ANNUAL TOTAL RETURN: This is a commonly used method to express an
investment's performance over a particular, usually multi-year time
period. It expresses the return that would have been necessary each year
to equal the investment's actual cumulative performance (including change
in NAV or market price and reinvested dividends and capital gains
distributions, if any) over the time period being considered.
o AVERAGE EFFECTIVE MATURITY: The average of the number of years to maturity
of the bonds in a Fund's portfolio, computed by weighting each bond's time
to maturity (the date the security comes due) by the market value of the
security. This figure does not account for the likelihood of prepayments
or the exercise of call provisions unless an escrow account has been
established to redeem the bond before maturity. The market value weighting
for an investment in an inverse floating rate security is the value of the
portfolio's residual interest in the inverse floating rate trust, and does
not include the value of the floating rate securities issued by the trust.
o INVERSE FLOATERS: Inverse floating rate securities are created by
depositing a municipal bond, typically with a fixed interest rate, into a
special purpose trust created by a broker-dealer. This trust, in turn, (a)
issues floating rate certificates typically paying short-term tax-exempt
interest rates to third parties in amounts equal to some fraction of the
deposited bond's par amount or market value, and (b) issues an inverse
floating rate certificate (sometimes referred to as an "inverse floater")
to an investor (such as a Fund) interested in gaining investment exposure
to a long-term municipal bond. The income received by the holder of the
inverse floater varies inversely with the short-term rate paid to the
floating rate certificates' holders, and in most circumstances the holder
of the inverse floater bears substantially all of the underlying bond's
downside investment risk. The holder of the inverse floater typically also
benefits disproportionately from any potential appreciation of the
underlying bond's value. Hence, an inverse floater essentially represents
an investment in the underlying bond on a leveraged basis.
o DURATION: Duration is a measure of the expected period over which a bond's
principal and interest will be paid, and consequently is a measure of the
sensitivity of a bond's or bond Fund's value to changes when market
interest rates change. Generally, the longer a bond's or Fund's duration,
the more the price of the bond or Fund will change as interest rates
change.
o MARKET YIELD (ALSO KNOWN AS DIVIDEND YIELD OR CURRENT YIELD): An
investment's current annualized dividend divided by its current market
price.
o NET ASSET VALUE (NAV): A Fund's NAV per share is calculated by subtracting
the liabilities of the Fund from its total assets and then dividing the
remainder by the number of shares outstanding. Fund NAVs are calculated at
the end of each business day.
o TAXABLE-EQUIVALENT YIELD: The yield necessary from a fully taxable
investment to equal, on an after-tax basis, the yield of a municipal bond
investment.
o ZERO COUPON BOND: A zero coupon bond does not pay a regular interest
coupon to its holders during the life of the bond. Tax-exempt income to
the holder of the bond comes from accretion of the difference between the
original purchase price of the bond at issuance and the par value of the
bond at maturity and is effectively paid at maturity. The market prices of
zero coupon bonds generally are more volatile than the market prices of
bonds that pay interest periodically.
79
NOTES
80
NOTES
81
NOTES
82
| Other Useful INFORMATION
QUARTERLY PORTFOLIO OF INVESTMENTS AND PROXY VOTING INFORMATION
You may obtain (i) each Fund's quarterly portfolio of investments, (ii)
information regarding how the Funds voted proxies relating to portfolio
securities held during the twelve-month period ended June 30, 2008, and (iii) a
description of the policies and procedures that the Funds used to determine how
to vote proxies relating to portfolio securities without charge, upon request,
by calling Nuveen Investments toll-free at (800) 257-8787 or on Nuveen's website
at www.nuveen.com.
You may also obtain this and other Fund information directly from the Securities
and Exchange Commission ("SEC"). The SEC may charge a copying fee for this
information. Visit the SEC on-line at http://www.sec.gov or in person at the
SEC's Public Reference Room in Washington, D.C. Call the SEC at (202) 942-8090
for room hours and operation. You may also request Fund information by sending
an e-mail request to publicinfo@sec.gov or by writing to the SEC's Public
References Section at 100 F Street NE, Washington, D.C. 20549.
CEO CERTIFICATION DISCLOSURE
Each Fund's Chief Executive Officer has submitted to the New York Stock Exchange
(NYSE) the annual CEO certification as required by Section 303A.12(a) of the
NYSE Listed Company Manual.
Each Fund has filed with the SEC the certification of its Chief Executive
Officer and Chief Financial Officer required by Section 302 of the
Sarbanes-Oxley Act.
SHARE INFORMATION
Each Fund intends to repurchase shares of its own common stock in the future at
such times and in such amounts as is deemed advisable. During the period covered
by this report, the Funds did not repurchase any of their common shares.
Any future repurchases will be reported to shareholders in the next annual or
semi-annual report.
BOARD OF TRUSTEES
John P. Amboian
Robert P. Bremner
Jack B. Evans
William C. Hunter
David J. Kundert
William J. Schneider
Judith M. Stockdale
Carole E. Stone
Terence J. Toth
FUND MANAGER
Nuveen Asset Management
333 West Wacker Drive
Chicago, IL 60606
CUSTODIAN
State Street Bank & Trust Company
Boston, MA
TRANSFER AGENT AND
SHAREHOLDER SERVICES
State Street Bank & Trust Company
Nuveen Funds
P.O. Box 43071
Providence, RI 02940-3071
(800) 257-8787
LEGAL COUNSEL
Chapman and Cutler LLP
Chicago, IL
INDEPENDENT REGISTERED
PUBLIC ACCOUNTING FIRM
Ernst & Young LLP
Chicago, IL
83
Nuveen Investments:
SERVING INVESTORS FOR GENERATIONS
Since 1898, financial advisors and their clients have relied on Nuveen
Investments to provide dependable investment solutions. For the past century,
Nuveen Investments has adhered to the belief that the best approach to investing
is to apply conservative risk-management principles to help minimize volatility.
Building on this tradition, we today offer a range of high quality equity and
fixed-income solutions that are integral to a well-diversified core portfolio.
Our clients have come to appreciate this diversity, as well as our continued
adherence to proven, long-term investing principles.
WE OFFER MANY DIFFERENT INVESTING SOLUTIONS FOR OUR CLIENTS' DIFFERENT NEEDS.
Nuveen Investments is a global investment management firm that seeks to help
secure the long-term goals of institutions and high net worth investors as well
as the consultants and financial advisors who serve them. Nuveen Investments
markets its growing range of specialized investment solutions under the
high-quality brands of HydePark, NWQ, Nuveen, Santa Barbara, Symphony,
Tradewinds and Winslow Capital. In total, the Company managed $115 billion of
assets on March 31, 2009.
FIND OUT HOW WE CAN HELP YOU REACH YOUR FINANCIAL GOALS.
To learn more about the products and services Nuveen Investments offers, talk to
your financial advisor, or call us at (800) 257-8787. Please read the
information provided carefully before you invest. Be sure to obtain a
prospectus, where applicable. Investors should consider the investment objective
and policies, risk considerations, charges and expenses of the Fund carefully
before investing. The prospectus contains this and other information relevant to
an investment in the Fund. For a prospectus, please contact your securities
representative or Nuveen Investments, 333 W. Wacker Dr., Chicago, IL 60606.
Please read the prospectus carefully before you invest or send money.
Learn more about Nuveen Funds at: WWW.NUVEEN.COM/CEF
SHARE PRICES
FUND DETAILS
DAILY FINANCIAL NEWS
INVESTOR EDUCATION
INTERACTIVE PLANNING TOOLS
EAN-B-0309D
ITEM 2. CODE OF ETHICS.
As of the end of the period covered by this report, the registrant has adopted a
code of ethics that applies to the registrant's principal executive officer,
principal financial officer, principal accounting officer or controller, or
persons performing similar functions. There were no amendments to or waivers
from the Code during the period covered by this report. The registrant has
posted the code of ethics on its website at www.nuveen.com/CEF/Info/Shareholder.
(To view the code, click on Fund Governance and then click on Code of Conduct.)
ITEM 3. AUDIT COMMITTEE FINANCIAL EXPERT.
The registrant's Board of Directors or Trustees ("Board") determined that the
registrant has at least one "audit committee financial expert" (as defined in
Item 3 of Form N-CSR) serving on its Audit Committee. The registrant's audit
committee financial expert is Jack B. Evans, who is "independent" for purposes
of Item 3 of Form N-CSR.
Mr. Evans was formerly President and Chief Operating Officer of SCI Financial
Group, Inc., a full service registered broker-dealer and registered investment
adviser ("SCI"). As part of his role as President and Chief Operating Officer,
Mr. Evans actively supervised the Chief Financial Officer (the "CFO") and
actively supervised the CFO's preparation of financial statements and other
filings with various regulatory authorities. In such capacity, Mr. Evans was
actively involved in the preparation of SCI's financial statements and the
resolution of issues raised in connection therewith. Mr. Evans has also served
on the audit committee of various reporting companies. At such companies, Mr.
Evans was involved in the oversight of audits, audit plans, and the preparation
of financial statements. Mr. Evans also formerly chaired the audit committee of
the Federal Reserve Bank of Chicago.
ITEM 4. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
Nuveen Select Tax-Free Income Portfolio
The following tables show the amount of fees that Ernst & Young LLP, the Fund's
auditor, billed to the Fund during the Fund's last two full fiscal years. For
engagements with Ernst & Young LLP the Audit Committee approved in advance all
audit services and non-audit services that Ernst & Young LLP provided to the
Fund, except for those non-audit services that were subject to the pre-approval
exception under Rule 2-01 of Regulation S-X (the "pre-approval exception"). The
pre-approval exception for services provided directly to the Fund waives the
pre-approval requirement for services other than audit, review or attest
services if: (A) the aggregate amount of all such services provided constitutes
no more than 5% of the total amount of revenues paid by the Fund to its
accountant during the fiscal year in which the services are provided; (B) the
Fund did not recognize the services as non-audit services at the time of the
engagement; and (C) the services are promptly brought to the Audit Committee's
attention, and the Committee (or its delegate) approves the services before the
audit is completed.
The Audit Committee has delegated certain pre-approval responsibilities to its
Chairman (or, in his absence, any other member of the Audit Committee).
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE FUND
AUDIT FEES BILLED AUDIT-RELATED FEES TAX FEES ALL OTHER FEES
FISCAL YEAR ENDED TO FUND (1) BILLED TO FUND (2) BILLED TO FUND (3) BILLED TO FUND
------------------------------------------------------------------------------------------------------------------------------------
March 31, 2009 $ 15,019 $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
March 31, 2008 $ 14,420 $ 0 $ 500 $ 0
------------------------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------------------------
(1) "Audit Fees" are the aggregate fees billed for professional services for
the audit of the Fund's annual financial statements and services provided
in connection with statutory and regulatory filings or engagements.
(2) "Audit Related Fees" are the aggregate fees billed for assurance and
related services reasonably related to the performance of the audit or
review of financial statements and are not reported under "Audit Fees."
(3) "Tax Fees" are the aggregate fees billed for professional services for tax
advice, tax compliance, and tax planning.
SERVICES THAT THE FUND'S AUDITOR BILLED TO THE
ADVISER AND AFFILIATED FUND SERVICE PROVIDERS
The following tables show the amount of fees billed by Ernst & Young LLP to
Nuveen Asset Management ("NAM" or the "Adviser"), and any entity controlling,
controlled by or under common control with NAM that provides ongoing services to
the Fund ("Affiliated Fund Service Provider"), for engagements directly related
to the Fund's operations and financial reporting, during the Fund's last two
full fiscal years.
The tables also show the percentage of fees subject to the pre-approval
exception. The pre-approval exception for services provided to the Adviser and
any Affiliated Fund Service Provider (other than audit, review or attest
services) waives the pre-approval requirement if: (A) the aggregate amount of
all such services provided constitutes no more than 5% of the total amount of
revenues paid to Ernst & Young LLP by the Fund, the Adviser and Affiliated Fund
Service Providers during the fiscal year in which the services are provided that
would have to be pre-approved by the Audit Committee; (B) the Fund did not
recognize the services as non-audit services at the time of the engagement; and
(C) the services are promptly brought to the Audit Committee's attention, and
the Committee (or its delegate) approves the services before the Fund's audit is
completed.
FISCAL YEAR ENDED AUDIT-RELATED FEES TAX FEES BILLED TO ALL OTHER FEES
BILLED TO ADVISER AND ADVISER AND BILLED TO ADVISER
AFFILIATED FUND AFFILIATED FUND AND AFFILIATED FUND
SERVICE PROVIDERS SERVICE PROVIDERS SERVICE PROVIDERS
------------------------------------------------------------------------------------------------------------------
March 31, 2009 $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------
March 31, 2008 $ 0 $ 0 $ 0
------------------------------------------------------------------------------------------------------------------
Percentage approved 0% 0% 0%
pursuant to
pre-approval
exception
------------------------------------------------------------------------------------------------------------------
NON-AUDIT SERVICES
The following table shows the amount of fees that Ernst & Young LLP billed
during the Fund's last two full fiscal years for non-audit services. The Audit
Committee is required to pre-approve non-audit services that Ernst & Young LLP
provides to the Adviser and any Affiliated Fund Services Provider, if the
engagement related directly to the Fund's operations and financial reporting
(except for those subject to the pre-approval exception described above). The
Audit Committee requested and received information from Ernst & Young LLP about
any non-audit services that Ernst & Young LLP rendered during the Fund's last
fiscal year to the Adviser and any Affiliated Fund Service Provider. The
Committee considered this information in evaluating Ernst & Young LLP's
independence.
FISCAL YEAR ENDED TOTAL NON-AUDIT FEES
BILLED TO ADVISER AND
AFFILIATED FUND SERVICE TOTAL NON-AUDIT FEES
PROVIDERS (ENGAGEMENTS BILLED TO ADVISER AND
RELATED DIRECTLY TO THE AFFILIATED FUND SERVICE
TOTAL NON-AUDIT FEES OPERATIONS AND FINANCIAL PROVIDERS (ALL OTHER
BILLED TO FUND REPORTING OF THE FUND) ENGAGEMENTS) TOTAL
--------------------------------------------------------------------------------------------------------------------------------
March 31, 2009 $ 0 $ 0 $ 0 $ 0
March 31, 2008 $ 500 $ 0 $ 0 $ 500
"Non-Audit Fees billed to Adviser" for both fiscal year ends represent "Tax
Fees" billed to Adviser in their respective amounts from the previous table.
Audit Committee Pre-Approval Policies and Procedures. Generally, the Audit
Committee must approve (i) all non-audit services to be performed for the Fund
by the Fund's independent accountants and (ii) all audit and non-audit services
to be performed by the Fund's independent accountants for the Affiliated Fund
Service Providers with respect to operations and financial reporting of the
Fund. Regarding tax and research projects conducted by the independent
accountants for the Fund and Affiliated Fund Service Providers (with respect to
operations and financial reports of the Fund) such engagements will be (i)
pre-approved by the Audit Committee if they are expected to be for amounts
greater than $10,000; (ii) reported to the Audit Committee chairman for his
verbal approval prior to engagement if they are expected to be for amounts under
$10,000 but greater than $5,000; and (iii) reported to the Audit Committee at
the next Audit Committee meeting if they are expected to be for an amount under
$5,000.
ITEM 5. AUDIT COMMITTEE OF LISTED REGISTRANTS.
The registrant's Board has a separately designated Audit Committee established
in accordance with Section 3(a)(58)(A) of the Securities Exchange Act of 1934,
as amended (15 U.S.C. 78c(a)(58)(A)). The members of the audit committee are
Robert P. Bremner, Jack B. Evans, Terence J. Toth, William J. Schneider and
David J. Kundert.
ITEM 6. SCHEDULE OF INVESTMENTS.
See Portfolio of Investments in Item 1.
ITEM 7. DISCLOSURE OF PROXY VOTING POLICIES AND PROCEDURES FOR CLOSED-END
MANAGEMENT INVESTMENT COMPANIES.
The registrant invests its assets primarily in municipal bonds and cash
management securities. On rare occasions the registrant may acquire, directly or
through a special purpose vehicle, equity securities of a municipal bond issuer
whose bonds the registrant already owns when such bonds have deteriorated or are
expected shortly to deteriorate significantly in credit quality. The purpose of
acquiring equity securities generally will be to acquire control of the
municipal bond issuer and to seek to prevent the credit deterioration or
facilitate the liquidation or other workout of the distressed issuer's credit
problem. In the course of exercising control of a distressed municipal issuer,
NAM may pursue the registrant's interests in a variety of ways, which may entail
negotiating and executing consents, agreements and other arrangements, and
otherwise influencing the management of the issuer. NAM does not consider such
activities proxy voting for purposes of Rule 206(4)-6 under the 1940 Act, but
nevertheless provides reports to the registrant's Board on its control
activities on a quarterly basis.
In the rare event that a municipal issuer were to issue a proxy or that the
registrant were to receive a proxy issued by a cash management security, NAM
would either engage an independent third party to determine how the proxy should
be voted or vote the proxy with the consent, or based on the instructions, of
the registrant's Board or its representative. A member of NAM's legal department
would oversee the administration of the voting, and ensure that records were
maintained in accordance with Rule 206(4)-6, reports were filed with the SEC on
Form N-PX, and the results provided to the registrant's Board and made available
to shareholders as required by applicable rules.
ITEM 8. PORTFOLIO MANAGERS OF CLOSED-END MANAGEMENT INVESTMENT COMPANIES.
THE PORTFOLIO MANAGER
The following individual has primary responsibility for the day-to-day
implementation of the registrant's investment strategies:
NAME FUND
Thomas Spalding Nuveen Select Tax-Free Income Portfolio
Other Accounts Managed. In addition to managing the registrant, the portfolio
manager is also primarily responsible for the day-to-day portfolio management of
the following accounts:
NUMBER OF
PORTFOLIO MANAGER TYPE OF ACCOUNT MANAGED ACCOUNTS ASSETS
--------------------------------------------------------------------------------
Thomas Spalding Registered Investment Company 11 $8.23 billion
Other Pooled Investment Vehicles 0 $0
Other Accounts 5 $15 million
* Assets are as of March 31, 2009. None of the assets in these accounts are
subject to an advisory fee based on performance.
Compensation. Each portfolio manager's compensation consists of three basic
elements--base salary, cash bonus and long-term incentive compensation. The
compensation strategy is to annually compare overall compensation to the market
in order to create a compensation structure that is competitive and consistent
with similar financial services companies. As discussed below, several factors
are considered in determining each portfolio manager's total compensation. In
any year these factors may include, among others, the effectiveness of the
investment strategies recommended by the portfolio manager's investment team,
the investment performance of the accounts managed by the portfolio manager, and
the overall performance of Nuveen Investments, Inc. (the parent company of NAM).
Although investment performance is a factor in determining the portfolio
manager's compensation, it is not necessarily a decisive factor. The portfolio
manager's performance is evaluated in part by comparing manager's performance
against a specified investment benchmark. This fund-specific benchmark is a
customized subset (limited to bonds in each Fund's specific state and with
certain maturity parameters) of the S&P/Investortools Municipal Bond index, an
index comprised of bonds held by managed municipal bond fund customers of
Standard & Poor's Securities Pricing, Inc. that are priced daily and whose fund
holdings aggregate at least $2 million. As of April 30, 2009, the
S&P/Investortools Municipal Bond index was comprised of 52,532 securities with
an aggregate current market value of $1,047 billion.
Base salary. Each portfolio manager is paid a base salary that is set at a level
determined by NAM in accordance with its overall compensation strategy discussed
above. NAM is not under any current contractual obligation to increase a
portfolio manager's base salary.
Cash bonus. Each portfolio manager is also eligible to receive an annual cash
bonus. The level of this bonus is based upon evaluations and determinations made
by each portfolio manager's supervisors, along with reviews submitted by his
peers. These reviews and evaluations often take into account a number of
factors, including the effectiveness of the investment strategies recommended to
NAM's investment team, the performance of the accounts for which he serves as
portfolio manager relative to any benchmarks established for those accounts, his
effectiveness in communicating investment performance to stockholders and their
representatives, and his contribution to NAM's investment process and to the
execution of investment strategies. The cash bonus component is also impacted by
the overall performance of Nuveen Investments, Inc. in achieving its business
objectives.
Long-term incentive compensation. In connection with the acquisition of Nuveen
Investments, Inc., by a group of investors led by Madison Dearborn Partners in
November 2007, certain employees, including portfolio managers, received profit
interests in Nuveen's parent. These profit interests entitle the holders to
participate in the appreciation in the value of Nuveen beyond the issue date and
vest over five to seven years, or earlier in the case of a liquidity event.
Material Conflicts of Interest. Each portfolio manager's simultaneous management
of the Fund and the other accounts noted above may present actual or apparent
conflicts of interest with respect to the allocation and aggregation of
securities orders placed on behalf of the Fund and the other account. The
Adviser, however, believes that such potential conflicts are mitigated by the
fact that the Adviser has adopted several policies that address potential
conflicts of interest, including best execution and trade allocation policies
that are designed to ensure (1) that portfolio management is seeking the best
price for portfolio securities under the circumstances, (2) fair and equitable
allocation of investment opportunities among accounts over time and (3)
compliance with applicable regulatory requirements. All accounts are to be
treated in a non-preferential manner, such that allocations are not based upon
account performance, fee structure or preference of the portfolio manager. In
addition, the Adviser has adopted a Code of Conduct that sets forth policies
regarding conflicts of interest.
Beneficial Ownership of Securities. As of the March 31, 2009, the portfolio
manager beneficially owned the following dollar range of equity securities
issued by the Fund and other Nuveen Funds managed by NAM's municipal investment
team.
DOLLAR RANGE OF
EQUITY SECURITIES
BENEFICIALLY OWNED
DOLLAR RANGE IN THE REMAINDER OF
OF EQUITY NUVEEN FUNDS
SECURITIES MANAGED BY NAM'S
NAME OF PORTFOLIO BENEFICIALLY MUNICIPAL
MANAGER FUND OWNED IN FUND INVESTMENT TEAM
-----------------------------------------------------------------------------------------------------------
Thomas Spalding Nuveen Select Tax-Free Income Portfolio $0 $500,001-$1,000,000
PORTFOLIO MANAGER BIO:
Thomas Spalding, CFA is Vice President and Senior Investment Officer of Nuveen
Investments. He has direct investment responsibility for National Long Term
funds. He joined Nuveen in 1976 as assistant portfolio manager and has been the
portfolio manager of the Nuveen Municipal Value Fund, Nuveen's first closed-end
exchange traded fund, since its inception in 1987. Currently, he manages
investments for 12 Nuveen-sponsored investment companies.
ITEM 9. PURCHASES OF EQUITY SECURITIES BY CLOSED-END MANAGEMENT INVESTMENT
COMPANY AND AFFILIATED PURCHASERS.
Not applicable.
ITEM 10. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
There have been no material changes to the procedures by which shareholders may
recommend nominees to the registrant's Board implemented after the registrant
last provided disclosure in response to this item.
ITEM 11. CONTROLS AND PROCEDURES.
(a) The registrant's principal executive and principal financial officers,
or persons performing similar functions, have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act") (17 CFR 270.30a-3(c))) are effective, as of a date within
90 days of the filing date of this report that includes the disclosure
required by this paragraph, based on their evaluation of the controls
and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR
270.30a-3(b)) and Rules 13a-15(b) or 15d-15(b) under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")
(17 CFR 240.13a-15(b) or 240.15d-15(b)).
(b) There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) that occurred during the 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.
File the exhibits listed below as part of this Form. Letter or number the
exhibits in the sequence indicated.
(a)(1) Any code of ethics, or amendment thereto, that is the subject of the
disclosure required by Item 2, to the extent that the registrant intends to
satisfy the Item 2 requirements through filing of an exhibit: Not applicable
because the code is posted on registrant's website at www.nuveen.com/CEF/Info/
Shareholder and there were no amendments during the period covered by this
report. (To view the code, click on Fund Governance and then Code of Conduct.)
(a)(2) A separate certification for each principal executive officer and
principal financial officer of the registrant as required by Rule 30a-2(a) under
the 1940 Act (17 CFR 270.30a-2(a)) in the exact form set forth below: Ex-99.CERT
Attached hereto.
(a)(3) Any written solicitation to purchase securities under Rule 23c-1 under
the 1940 Act (17 CFR 270.23c-1) sent or given during the period covered by the
report by or on behalf of the registrant to 10 or more persons. Not applicable.
(b) If the report is filed under Section 13(a) or 15(d) of the Exchange Act,
provide the certifications required by Rule 30a-2(b) under the 1940 Act (17 CFR
270.30a-2(b)); Rule 13a-14(b) or Rule 15d-14(b) under the Exchange Act (17 CFR
240.13a-14(b) or 240.15d-14(b)), and Section 1350 of Chapter 63 of Title 18 of
the United States Code (18 U.S.C. 1350) as an exhibit. A certification furnished
pursuant to this paragraph will not be deemed "filed" for purposes of Section 18
of the Exchange Act (15 U.S.C. 78r), or otherwise subject to the liability of
that section. Such certification will not be deemed to be incorporated by
reference into any filing under the Securities Act of 1933 or the Exchange Act,
except to the extent that the registrant specifically incorporates it by
reference. Ex-99.906 CERT attached hereto.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
(Registrant) Nuveen Select Tax-Free Income Portfolio
-----------------------------------------------------------
By (Signature and Title) /s/ Kevin J. McCarthy
----------------------------------------------
Kevin J. McCarthy
Vice President and Secretary
Date: June 8, 2009
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Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By (Signature and Title) /s/ Gifford R. Zimmerman
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Gifford R. Zimmerman
Chief Administrative Officer
(principal executive officer)
Date: June 8, 2009
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By (Signature and Title) /s/ Stephen D. Foy
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Stephen D. Foy
Vice President and Controller
(principal financial officer)
Date: June 8, 2009
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