AQUILA TAX-FREE TRUST OF ARIZONA

SCHEDULE OF INVESTMENTS

December 31, 2022

(unaudited)

 

Principal
Amount
  General Obligation Bonds (37.1%)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    City (4.7%)            
    Buckeye Jackrabbit Trail Sanitary Sewer Improvement District            
$199,000   6.250%, 01/01/29   NR/A-/NR   $202,158    
                 
    Gilbert Improvement District No. 20            
460,000   5.100%, 01/01/29   Aa1/AA-/NR   465,166    
                 
    Goodyear McDowell Road Commercial Corridor Improvement District            
840,000   3.250%, 01/01/27 BAMAC Insured   Aa2/AA/NR   857,119    
                 
    Mesa, Arizona            
425,000   4.000%, 07/01/32   Aa2/AA/AAA   444,686    
                 
    Phoenix, Arizona            
3,000,000   5.000%, 07/01/27   Aa1/AA+/AAA   3,296,790    
                 
    Tempe Improvement District (Pier Town Lake)            
1,000,000   5.000%, 01/01/29   Aa2/NR/NR   1,013,390    
                 
    Tucson, Arizona            
3,000,000   5.000%, 07/01/24   Aa3/AA/AAA   3,097,290    
    Total City       9,376,599    
                 
    Community College (0.8%)            
    Pinal Co. Community College District            
500,000   4.000%, 07/01/33   NR/AA-/NR   536,515    
1,000,000   3.000%, 07/01/34   NR/AA-/NR   972,920    
    Total Community College       1,509,435    
                 
    County (8.5%)            
    Maricopa Co. Daisy Mountain Fire District            
340,000   4.000%, 07/01/27 AGMC Insured   NR/AA/NR   353,488    
                 
    Maricopa Co. Special Health Care District            
2,500,000   5.000%, 07/01/25   Aa3/NR/AA-   2,636,025    
3,000,000   5.000%, 07/01/32   Aa3/NR/AA-   3,313,230    
1,500,000   5.000%, 07/01/34   Aa3/NR/AA-   1,630,320    
4,345,000   5.000%, 07/01/34   Aa3/NR/AA-   4,902,116    
                 
    Yavapai Co. Jail District            
1,180,000   5.000%, 07/01/30 BAMAC Insured   NR/AA/AA   1,325,175    
1,650,000   4.000%, 07/01/33 BAMAC Insured   NR/AA/AA   1,734,051    
                 
    Yuma Co. Free Library District            
1,000,000   4.000%, 07/01/29   Aa3/NR/AAA   1,032,120    
    Total County       16,926,525    
                 

 

 

 
 
 

 

 

Principal
Amount
  General Obligation Bonds (continued)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    School District (21.0%)            
    Gila Co. Unified School District No. 10 (Payson)            
$1,000,000   5.000%, 07/01/28   Aa2/NR/NR   $1,030,940    
                 
    Glendale Union High School District No. 205            
525,000   5.000%, 07/01/27 BAMAC Insured   NR/AA/NR   529,998    
                 
    Maricopa Co. Elementary School District No. 1 (Phoenix)            
500,000   4.000%, 07/01/31 BAMAC Insured   NR/AA/NR   521,925    
460,000   4.000%, 07/01/32 BAMAC Insured   NR/AA/NR   479,453    
                 
    Maricopa Co. Elementary School District No. 2 (Riverside)            
1,000,000   5.000%, 07/01/30 BAMAC Insured   NR/AA/NR   1,128,710    
                 
    Maricopa Co. Elementary School District No. 3 (Tempe)            
500,000   5.000%, 07/01/30   Aa1/NR/NR   543,935    
5,615,000   5.000%, 07/01/31   Aa1/NR/NR   6,243,038    
                 
    Maricopa Co. Elementary School District No. 8 (Osborn)            
500,000   5.000%, 07/01/31 AGMC Insured   NR/AA/NR   545,475    
                 
    Maricopa Co. Elementary School District No. 25 (Liberty)            
350,000   4.000%, 07/01/35 AGMC Insured   NR/AA/NR   365,673    
300,000   4.000%, 07/01/36 AGMC Insured   NR/AA/NR   310,662    
375,000   4.000%, 07/01/37 AGMC Insured   NR/AA/NR   385,826    
                 
    Maricopa Co. Elementary School District No. 40 (Glendale)            
2,050,000   2.000%, 07/01/35 AGMC Insured   NR/AA/AA+   1,656,503    
                 
    Maricopa Co. Elementary School District No. 62 (Union)            
315,000   4.000%, 07/01/29 BAMAC Insured   NR/AA/NR   331,941    
580,000   4.000%, 07/01/32 BAMAC Insured   NR/AA/NR   610,989    
300,000   4.000%, 07/01/33 BAMAC Insured   NR/AA/NR   315,432    
375,000   4.000%, 07/01/34 BAMAC Insured   NR/AA/NR   393,720    
                 
    Maricopa Co. Elementary School District No. 65 (Littleton)            
125,000   3.000%, 07/01/35 BAMAC Insured   Aa3/AA/NR   112,006    
                 
    Maricopa Co. High School District No. 210 (Phoenix)            
500,000   4.000%, 07/01/26   Aa1/AA/AAA   516,255    
                 
    Maricopa Co. High School District No. 214 (Tolleson)            
200,000   3.000%, 07/01/35   Aaa/AA/NR   189,384    
                 
    Maricopa Co. Unified School District No. 4 (Mesa)            
4,000,000   5.000%, 07/01/29   Aa2/AA-/NR   4,557,240    
                 
    Maricopa Co. Unified School District No. 11 (Peoria)            
1,490,000   4.000%, 07/01/25   Aa3/AA-/NR   1,491,445    
675,000   4.500%, 07/01/33 AGMC Insured   Aa3/AA/NR   697,187    

 

 

 
 
 

 

 

Principal
Amount
  General Obligation Bonds (continued)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    School District (continued)            
    Maricopa Co. Unified School District No. 41 (Gilbert)            
$3,000,000   5.000%, 07/01/26   Aa1/AA-/NR   $3,234,360    
                 
    Maricopa Co. Unified School District No. 48 (Scottsdale)            
2,350,000   3.000%, 07/01/34   Aa1/AA/NR   2,304,034    
                 
    Maricopa Co. Unified School District No. 60 (Higley)            
1,615,000   5.000%, 07/01/29   Aa2/AA-/NR   1,664,500    
                 
    Maricopa Co. Unified School District No. 66 (Roosevelt)            
910,000   4.000%, 07/01/31 BAMAC Insured   A1/AA/NR   951,851    
                 
    Maricopa Co. Unified School District No. 69 (Paradise Valley)            
1,500,000   5.000%, 07/01/27   Aa1/NR/AAA   1,648,395    
425,000   4.000%, 07/01/35   Aa1/NR/AAA   443,942    
                 
    Maricopa Co. Unified School District No. 80 (Chandler)            
545,000   4.000%, 07/01/36   Aaa/AA/NR   560,827    
                 
    Maricopa Co. Unified School District No. 89 (Dysart)            
500,000   4.000%, 07/01/28   NR/A+/AAA   507,425    
                 
    Navajo Co. Unified School District No. 10 (Show Low)            
500,000   4.000%, 07/01/31 AGMC Insured   NR/AA/NR   521,495    
                 
    Navajo Co. Unified School District No. 32 (Blue Ridge)            
400,000   5.000%, 07/01/29 AGMC Insured   NR/AA/NR   434,272    
                 
    Pima Co. Unified School District No. 6 (Marana)            
955,000   5.000%, 07/01/25   NR/A/NR   965,266    
950,000   5.250%, 07/01/25 AGMC Insured   NR/AA/NR   961,362    
1,000,000   4.250%, 07/01/32 AGMC Insured   NR/AA/NR   1,034,010    
1,000,000   4.000%, 07/01/37 AGMC Insured   NR/AA/NR   1,021,080    
                 
    Pima Co. Unified School District No. 8 (Flowing Wells)            
1,000,000   4.500%, 07/01/37 AGMC Insured   NR/AA/NR   1,038,240    
250,000   4.000%, 07/01/28 BAMAC Insured   NR/AA/NR   264,425    
                 
    Pima Co. Unified School District No. 12 (Sunnyside)            
1,050,000   4.000%, 07/01/28 BAMAC Insured   NR/AA/NR   1,057,529    
                 
    Santa Cruz Co. Unified School District No. 35 (Santa Cruz Valley)            
300,000   3.000%, 07/01/36 AGMC Insured   NR/AA/NR   283,398    
    Total School District       41,854,148    

 

 

 
 
 

 

 

Principal
Amount
  General Obligation Bonds (continued)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    Special District (2.1%)            
    Eastmark Community Facilities District No. 1            
$345,000   4.000%, 07/15/33 AGMC Insured   NR/AA/NR   $357,644    
360,000   4.000%, 07/15/34 AGMC Insured   NR/AA/NR   372,607    
                 
    Estrella Mountain Ranch Community Facilities District            
155,000   5.000%, 07/15/32 AGMC Insured   NR/AA/NR   167,088    
                 
    Gladden Farms Phase II Community Facilities District            
300,000   5.000%, 07/15/47 BAMAC Insured   NR/AA/NR   311,184    
                 
    Goodyear Community Facilities Utilities District No. 1            
500,000   4.000%, 07/15/28   A1/A-/NR   505,515    
460,000   4.000%, 07/15/32   A1/A-/NR   473,570    
                 
    Merrill Ranch Community Facilities District #2            
680,000   6.750%, 07/15/38   NR/BBB/NR   692,451    
                 
    Verrado Community Facilities Utilities District No. 1            
500,000   6.000%, 07/15/33 144A   NR/NR/NR*   500,580    
                 
    Vistancia Community Facilities District            
850,000   4.000%, 07/15/25 BAMAC Insured   A1/AA/NR   872,117    
    Total Special District       4,252,756    
    Total General Obligation Bonds       73,919,463    
                 
    Revenue Bonds (55.9%)            
    Airport (7.1%)            
    Phoenix Civic Improvement Corp. Airport Bonds            
4,000,000   4.000%, 07/01/40   A1/A+/NR   3,879,560    
2,595,000   5.000%, 07/01/27 AMT   Aa3/AA-/NR   2,755,553    
185,000   5.000%, 07/01/30 AMT   Aa3/AA-/NR   195,286    
3,850,000   5.000%, 07/01/31 AMT   Aa3/AA-/NR   4,057,130    
2,900,000   5.000%, 07/01/31 AMT   Aa3/AA-/NR   3,087,427    
200,000   5.000%, 07/01/33 AMT   Aa3/AA-/NR   212,060    
    Total Airport       14,187,016    

 

 

 
 
 

 

 

Principal
Amount
  Revenue Bonds (continued)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    Charter Schools (3.9%)            
    Arizona Industrial Development Authority (Basis Schools)            
$240,000   5.000%, 07/01/37 State Enhanced   NR/AA-/NR   $249,362    
                 
    Arizona Industrial Development Authority (Candeo Schools)            
500,000   3.375%, 07/01/41 State Enhanced   NR/AA-/NR   417,015    
                 
    Arizona Industrial Development Authority (Equitable Schools)            
1,000,000   4.000%, 11/01/36   NR/A/NR   959,820    
2,000,000   4.000%, 11/01/38   NR/A/NR   1,883,440    
2,000,000   4.000%, 11/01/40   NR/A/NR   1,842,260    
                 
    Arizona Industrial Development Authority (Greathearts Academies)            
1,000,000   3.000%, 07/01/37 State Enhanced   NR/AA-/NR   840,490    
                 
    Maricopa Co. Industrial Development Authority (Great Hearts Arizona Projects)            
250,000   5.000%, 07/01/26 State Enhanced   NR/AA-/NR   262,535    
315,000   5.000%, 07/01/37 State Enhanced   NR/AA-/NR   327,159    
                 
    Phoenix Industrial Development Authority (Macombs Facility Project)            
315,000   5.000%, 07/01/33   NR/BBB-/NR   331,834    
325,000   4.000%, 07/01/34   NR/BBB-/NR   310,001    
315,000   4.000%, 07/01/35   NR/BBB-/NR   295,961    
    Total Charter Schools       7,719,877    
                 
    Excise Tax (7.3%)            
    Buckeye Excise Tax            
400,000   4.000%, 07/01/36   NR/AA/AA   410,684    
                 
    Buckeye Roosevelt Street Improvement District            
85,000   4.000%, 01/01/32   NR/A-/NR   85,408    
                 
    Cottonwood Pledged Revenue Obligations            
500,000   5.000%, 07/01/30 AGMC Insured   NR/AA/NR   525,970    
                 
    Flagstaff Pledged Revenue            
1,395,000   4.250%, 07/01/33   NR/AA/NR   1,459,616    
                 
    Gila Co. Pledged Revenue Obligations            
555,000   4.000%, 07/01/30   NR/AA/NR   588,256    
                 
    Marana Pledged Excise Tax            
275,000   4.000%, 07/01/30   NR/AA/NR   276,235    
                 
    Phoenix Civic Improvement Corp. (Civic Plaza)            
2,000,000   5.500%, 07/01/27 BHAC/FGIC Insured   Aa1/AA+/NR   2,230,960    
2,000,000   5.500%, 07/01/30 BHAC/FGIC Insured   Aa1/AA+/NR   2,360,200    
1,000,000   5.500%, 07/01/23 NPFG/FGIC Insured   Aa2/AA/NR   1,012,040    
2,300,000   5.500%, 07/01/33 NPFG/FGIC Insured   Aa2/AA/NR   2,785,691    
                 
    Santa Cruz Co. Jail District            
1,655,000   5.000%, 07/01/28 AGMC Insured   NR/AA/NR   1,784,504    
885,000   5.000%, 07/01/31 AGMC Insured   NR/AA/NR   946,596    
    Total Excise Tax       14,466,160    

 

 

 
 
 

 

 

Principal
Amount
  Revenue Bonds (continued)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    Healthcare (5.8%)            
    Maricopa Co. Industrial Development Authority (Banner Health)            
$   500,000   4.000%, 01/01/48   NR/AA-/AA-   $   460,435    
1,000,000   5.000%, 01/01/48   NR/AA-/AA-   1,028,080    
                 
    Maricopa Co. Industrial Development Authority (HonorHealth)            
2,250,000   4.125%, 09/01/38   A2/NR/A+   2,243,723    
                 
    Phoenix Industrial Development Authority (Mayo Clinic) VRDO***            
2,650,000   3.540%, 11/15/52   Aa2/AA/NR   2,650,000    
                 
    Pima Co. Industrial Development Authority (Tucson Medical Center)            
1,150,000   5.000%, 04/01/33   NR/A/NR   1,261,251    
880,000   4.000%, 04/01/37   NR/A/NR   851,022    
250,000   3.000%, 04/01/51   NR/A/NR   177,788    
                 
    Yavapai Co. Industrial Development Authority (Yavapai Regional Medical Center)            
1,000,000   5.250%, 08/01/33   A2/NR/A+   1,007,910    
                 
    Yuma Industrial Development Authority (Yuma Regional Medical Center)            
1,635,000   5.000%, 08/01/23   NR/A/NR   1,650,189    
200,000   5.000%, 08/01/32   NR/A/NR   203,166    
    Total Healthcare       11,533,564    
                 
    Higher Education (7.5%)            
    Arizona Board of Regents (Arizona State University System) Green Bonds            
1,500,000   5.000%, 07/01/36   Aa2/AA/NR   1,721,430    
                 
    Arizona Board of Regents (Arizona State University System) VRDO***            
5,630,000   3.550%, 07/01/34   Aa2/AA/NR   5,630,000    
                 
    Arizona Board of Regents (Northern Arizona University) Speed Stimulus Plan for Economic & Educational Development            
2,090,000   5.000%, 08/01/29 AGMC Insured   A1/AA/NR   2,344,249    
                 
    Arizona Board of Regents (University of Arizona System) Speed Stimulus Plan for Economic & Educational Development            
1,000,000   3.125%, 08/01/39   Aa3/A+/NR   842,650    
                 
    Arizona Board of Regents (University of Arizona System)            
105,000   4.000%, 06/01/38   Aa2/AA-/NR   106,274    
                 
    Arizona Industrial Development Authority (North Carolina Central University Student Housing)            
250,000   4.000%, 06/01/34 BAMAC Insured   Baa3/AA/NR   255,965    
700,000   4.000%, 06/01/39 BAMAC Insured   Baa3/AA/NR   691,999    
                 
    Phoenix Industrial Development Authority (Downtown Phoenix Student Housing)            
200,000   5.000%, 07/01/26   Baa3/NR/NR   205,800    
400,000   5.000%, 07/01/33   Baa3/NR/NR   407,880    
1,250,000   5.000%, 07/01/42   Baa3/NR/NR   1,230,125    

 

 

 
 
 

 

 

Principal
Amount
  Revenue Bonds (continued)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    Higher Education (continued)            
    Phoenix Industrial Development Authority (Downtown Phoenix Student Housing II)            
$100,000   5.000%, 07/01/26   Baa3/NR/NR   $102,900    
250,000   5.000%, 07/01/27   Baa3/NR/NR   258,420    
150,000   5.000%, 07/01/28   Baa3/NR/NR   155,607    
200,000   5.000%, 07/01/30   Baa3/NR/NR   207,168    
300,000   5.000%, 07/01/32   Baa3/NR/NR   308,361    
                 
    Pima Co. Community College District            
500,000   4.000%, 07/01/38   Aa3/NR/AA-   505,790    
    Total Higher Education       14,974,618    
                 
    Housing (1.8%)            
    Arizona Industrial Development Authority Green Bond MTEB (Chandler Village Apartments Project)            
4,824,102   2.120%, 07/01/37 FNMA Insured Series 2020   Aaa/NR/NR   3,565,735    
                 
    Lease (2.5%)            
    Arizona Board of Regents (Northern Arizona University) COP            
600,000   5.000%, 09/01/27   A2/A/NR   601,038    
                 
    Nogales Municipal Development Authority, Inc.            
845,000   4.000%, 06/01/36   NR/AA-/NR   860,345    
615,000   5.000%, 06/01/28 AGMC Insured   NR/AA/NR   656,734    
810,000   4.000%, 06/01/33 AGMC Insured   NR/AA/NR   849,690    
2,000,000   4.000%, 06/01/39 AGMC Insured   NR/AA/NR   2,011,400    
                 
    State of Arizona COP            
100,000   5.000%, 09/01/27   Aa2/AA-/NR   105,610    
    Total Lease       5,084,817    
                 
    Pollution Control (0.7%)            
    Maricopa Co. Pollution Control (El Paso Electric Co.)            
375,000   3.600%, 02/01/40   Baa2/NR/BBB+   328,309    
250,000   3.600%, 04/01/40   Baa2/NR/BBB+   218,668    
                 
    Maricopa Co. Pollution Control (Southern California Edison Co.)            
1,000,000   2.400%, 06/01/35   A3/A-/BBB+   761,430    
    Total Pollution Control       1,308,407    
                 
    Resource Recovery (4.7%)            
    Chandler Industrial Development Authority (Intel Corporation Project)            
4,250,000   2.700%, 12/01/37 AMT (Mandatory Put Date 8/14/23)   A1/A+/NR   4,222,333    
3,000,000   5.000%, 09/01/52 AMT   A1/A+/NR   3,131,910    
                 
    Maricopa Co. Industrial Development Authority, (Waste Management Inc. Project)            
1,500,000   3.375%, 12/01/31 AMT (Mandatory Put Date 6/03/24)   NR/A-/NR   1,473,075    
                 
    Yavapai Co. Industrial Development Authority, (Waste Management Inc. Project)            
520,000   2.200%, 03/01/28 AMT (Mandatory Put Date 06/03/24)   NR/A-/NR   502,408    
    Total Resource Recovery       9,329,726    

 

 

 
 
 

 

 

Principal
Amount
  Revenue Bonds (continued)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    Sales Tax (3.3%)            
    Arizona Sports & Tourism Authority (Multipurpose Stadium Facility Project)            
$6,000,000   5.000%, 07/01/30 BAMAC Insured   A1/AA/A   $6,686,220    
                 
    Senior Living Facilities (1.1%)            
    Arizona Industrial Development Authority, Second Tier (Great Lakes Senior Living Communities)            
620,000   5.000%, 01/01/28   NR/CCC+/NR   494,735    
555,000   5.000%, 01/01/29   NR/CCC+/NR   436,530    
1,205,000   5.000%, 01/01/30   NR/CCC+/NR   922,500    
655,000   4.000%, 01/01/33   NR/CCC+/NR   415,624    
    Total Senior Living Facilities       2,269,389    
                 
    Utility (5.3%)            
    Greater Arizona Development Authority Revenue            
500,000   5.000%, 08/01/28 AGMC Insured   A1/AA/NR   509,875    
                 
    Mesa Utility System            
5,000,000   5.000%, 07/01/36   Aa3/A+/NR   5,821,250    
                 
    Salt Verde Finance Corp. Gas Revenue            
3,000,000   5.250%, 12/01/28   A3/BBB+/NR   3,151,080    
                 
    Yuma Utility System            
1,000,000   4.000%, 07/01/34 BAMAC Insured   NR/AA/AA-   1,044,690    
    Total Utility       10,526,895    
                 
    Water/Sewer (4.9%)            
    Glendale Water & Sewer Revenue Refunding Senior Lien            
6,120,000   3.000%, 07/01/24   A1/AA/NR   6,142,093    
                 
    Phoenix Civic Improvement Corp. Wastewater Revenue            
1,500,000   5.500%, 07/01/24 NPFG/FGIC Insured   Aa2/AAA/NR   1,559,970    
                 
    Pima Co. Sewer System Revenue Refunding            
2,000,000   5.000%, 07/01/26   NR/AA/AA   2,156,240    
    Total Water/Sewer       9,858,303    
    Total Revenue Bonds       111,510,727    
                 
    Pre-Refunded Bonds (4.1%)††            
    Pre-Refunded General Obligation Bonds (0.7%)            
    City (0.1%)            
    Glendale, Arizona            
200,000   5.000%, 07/01/33   NR/AA/AAA   224,370    
                 
    School District (0.1%)            
    Maricopa Co. Elementary School District No. 28 (Kyrene Elementary)            
250,000   5.500%, 07/01/30   Aaa/AA/NR   253,158    

 

 

 
 
 

 

 

Principal
Amount
  Pre-Refunded Bonds (continued)   Ratings
Moody's, S&P
and Fitch
  Value   (a)
    Special District (0.5%)            
    Estrella Mountain Ranch Community Facilities District            
$845,000   5.000%, 07/15/32 AGMC Insured   NR/AA/NR   $927,751    
                 
    Goodyear Community Facilities Utilities District No. 1            
40,000   4.000%, 07/15/32   NR/NR/NR*   41,763    
    Total Special District       969,514    
    Total Pre-Refunded General Obligation Bonds       1,447,042    
                 
    Pre-Refunded Revenue Bonds (3.4%)            
    Excise Tax (0.2%)            
    Scottsdale Municipal Property Corp.            
375,000   5.000%, 07/01/34   Aa1/AAA/AA+   396,424    
                 
    Healthcare (2.5%)            
    Arizona Health Facilities Authority (Banner Health)            
2,000,000   5.000%, 01/01/44   NR/AA-/NR   2,042,360    
                 
    Maricopa Co. Hospital Revenue (Sun Health)            
705,000   5.000%, 04/01/25   NR/NR/NR*   716,999    
2,125,000   5.000%, 04/01/35   NR/NR/NR*   2,182,163    
    Total Healthcare       4,941,522    
                 
    Higher Education (0.7%)            
    Northern Arizona University Speed Stimulus Plan for Economic & Educational Development            
1,445,000   5.000%, 08/01/38   A2/A/NR   1,462,311    
    Total Pre-Refunded Revenue Bonds       6,800,257    
    Total Pre-Refunded Bonds       8,247,299    
    Total Municipal Bonds (cost $200,920,090)       193,677,489    
                 
Shares    Short-Term Investment (1.2%)            
                 
2,263,661   Dreyfus Treasury Obligations Cash Management -
Institutional Shares, 4.17%** (cost $2,263,661)
  Aaa-mf/AAAm/NR   2,263,661    
                 
    Total Investments
(cost $203,183,751-note b)
  98.3%   195,941,150    
    Other assets less liabilities   1.7   3,468,834    
    Net Assets   100.0%   $199,409,984    
                 
                 
        Percent of        
    Portfolio Distribution By Quality Rating   Investments†        
    Aaa of Moody's or AAA of S&P or Fitch   8.7%        
    Pre-refunded bonds††   4.3        
    Aa of Moody's or AA of S&P or Fitch   66.4        
    A of Moody's or S&P or Fitch   16.5        
    Baa of Moody's or BBB of S&P or Fitch   2.6        
    CCC of S&P   1.2        
    Not Rated*   0.3        
        100.0%        

 

 

 
 
 

 

 

    PORTFOLIO ABBREVIATIONS            
    AGMC - Assured Guaranty Municipal Corp.            
    AMT - Alternative Minimum Tax            
    BAMAC - Build America Mutual Assurance Co.            
    BHAC - Berkshire Hathaway Assurance Corp.            
    COP- Certificates of Participation            
    FGIC - Financial Guaranty Insurance Co.            
    FNMA - Federal National Mortgage Association            
    MTEB- Multifamily Tax-Exempt Mortgage-Backed Bonds            
    NPFG - National Public Finance Guarantee            
    NR - Not Rated            
    VRDO - Variable Rate Demand Obligation            

 

 

    *    Any security not rated ("NR") by any of the Nationally Recognized Statistical Rating Organizations ("NRSRO") has been determined by the Investment Adviser to have sufficient quality to be ranked in the top four credit ratings if a credit rating were to be assigned by  a NRSRO.    
    **    The rate is an annualized seven-day yield at period end.    
    *** Variable rate demand obligations (VRDOs) are payable upon demand within the same day for securities with daily liquidity or seven days for securities with weekly liquidity.    
    †     Where applicable, calculated using the highest rating of the three NRSRO.  Percentages in this table do not include the Short-Term Investment.    
    ††   Pre-refunded bonds are bonds for which U.S. Government Obligations usually have been placed in escrow to retire the bonds at their earliest call date.    
      Note: 144A – Private placement subject to SEC rule 144A, which modifies a two-year holding period requirement to permit qualified institutional buyers to trade these securities among themselves, thereby significantly improving the liquidity of these securities.    

 

 

See accompanying notes to financial statements.

 

 
 
 

 

 

AQUILA TAX-FREE TRUST OF ARIZONA

NOTES TO FINANCIAL STATEMENTS

December 31, 2022

(unaudited)

 

 

(a)Securities valuation policies and other investment related disclosures are hereby incorporated by reference in the annual and semi-annual reports previously filed with the Securities and Exchange Commission on Form N-CSR.

 

(b)At December 31, 2022, the net unrealized depreciation on investments, based on cost for federal income tax purposes of $202,689,633 amounted to $6,748,483, which consisted of aggregate gross unrealized appreciation of $2,505,953 and aggregate gross unrealized depreciation of $9,254,436.

 

(c)Fair Value Measurements: The Trust follows a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Trust’s own market assumptions (unobservable inputs). These inputs are used in determining the value of the Trust’s investments and are summarized in the following fair value hierarchy:

 

Level 1 –  Unadjusted quoted prices in inactive markets for identical assets or liabilities that the Trust has the ability to access.
   
Level 2 –  Observable inputs other than quoted prices included in level 1 that are observable for the asset or liability, either directly or indirectly. These inputs may include quoted prices for the identical instrument on an inactive market, prices for similar instruments, interest rates, prepayment speeds, credit risk, yield curves, default rates and similar data.
   
Level 3 –  Unobservable inputs for the asset or liability, to the extent relevant observable inputs are not available, representing the Trust’s own assumptions about the assumptions a market participant would use in valuing the asset or liability, and would be based on the best information available.

 

The inputs or methodology used for valuing securities are not an indication of the risk associated with investing in those securities.

 

The following is a summary of the valuation inputs, representing 100% of the Trust’s investments, used to value the Trust’s net assets as of December 31, 2022:

 

Valuation Inputs+   Investments in
Securities
Level 1 – Quoted Prices – Short-Term Investment $ 2,263,661
Level 2 – Other Significant Observable Inputs - Municipal Bonds   193,677,489
Level 3 – Significant Unobservable Inputs  
Total $ 195,941,150

 

+ See schedule of investments for a detailed listing of securities.