SEC Company Response from VANGUARD CALIFORNIA TAX-FREE FUNDS (CIK 0000783401) — Mar 10, 2005
VANGUARD CALIFORNIA TAX-FREE FUNDS (CIK 0000783401)
Date: March 10, 2005 · CIK: 0000783401 · Accession: 0000932471-05-000543
AI Filing Summary & Sentiment
Letter
[SHIP LOGO] [THE VANGUARD GROUP(R) LOGO] March 10, 2005 Christian Sandoe, Esq. Division of Investment Management U.S. Securities and Exchange Commission via electronic filing 450 Fifth Street, N.W., Fifth Floor Washington, D.C. 20549
Re: Vanguard New York Tax-Free Funds Vanguard Florida Tax-Free Fund Vanguard Massachusetts Tax-Exempt Funds Vanguard New Jersey Tax-Free Funds Vanguard New York Tax-Free Funds Vanguard Ohio Tax-Free Funds Vanguard Pennsylvania Tax-Free Funds
Dear Mr. Sandoe:
The following responds to your comments of March 9, 2005 on the post-effective amendment of the registration statement of each of the above-referenced registrants. You commented on Post-Effective Amendments for each registrant that were filed on January 21, 2005 pursuant to Rule 485(a).
Comment 1: Prospectus - Each Registrant -------------------------------------------------------------------------------- Comment: In each fund's prospectus, Vanguard provides the dollar weighted average maturity range. Please add the dollar weighted average maturity as of a particular date, for example, each fund's fiscal year end.
Response: We do not plan to add the requested disclosure. It is not required of us by Form N-1A, and while we agree that both the range and the figure as of the fiscal year end are informative, the latter is disclosed in each fund's shareholder report, where both existing and prospective investors can access it.
Comment 2: Prospectus - California Intermediate-Term Tax-Exempt Fund -------------------------------------------------------------------------------- Comment: The Primary Investment Strategies section states that the dollar-weighted average maturity for the Fund will be 6-12 years. Rule 35d-1 refers to 3-10 years for intermediate-term bond funds. <PAGE>
Response: The guide referred to in the adopting release for rule 35d-1 assumes, with respect to maturity, that bond funds come in three -- and only three -- categories: short-, intermediate-, and long-term. Although this is a common categorization, it is not the one Vanguard uses for its tax-exempt bond funds. Vanguard offers four such funds, which are managed to the following dollar-weighted average maturities:
Short-Term 1-2 years Limited-Term 2-6 Intermediate-Term 6-12 Long-Term 12-25
Where four categories are used, rather than three, we believe that any advantage gained by the application of the staff's uniform standard is outweighed by the disadvantages of placing a fund into an artificial -- and inappropriate -- maturity range.
Changing the maturity range for the Fund to 3-10 years would not be in shareholders' best interests because it would result in an overlap in the maturity range between Vanguard's Limited-Term and Intermediate-Term Tax-Exempt Funds. We think investors are better served with a menu of offerings in which the average maturities of the funds are clearly delineated and do not overlap.
We acknowledge that the staff should prevent funds from using names that are potentially misleading. But under any reasonable interpretation of the applicable guide and rule 35d-1, an average maturity range of 6-12 years qualifies as "intermediate-term." The name of Vanguard's California Intermediate-Term Tax-Exempt Fund is not misleading, especially when placed in the context of the other tax-exempt funds offered by Vanguard.
Comment 3: SAI - Investment Limitations -------------------------------------------------------------------------------- Comment: The SAI does not include a fundamental policy on industry concentration.
Response: The SEC has stated that "[t]he statement of policy required by section 8(b)(1) as to concentration is not applicable to investments in tax-exempt securities issued by governments or political subdivisions of governments since such issuers are not members of any industry.1" Accordingly, our state tax-free funds do not have a policy with respect to industry concentration. We do not plan to add anything to the SAI in response to this comment.
---------------------------------- 1 Investment Company Act Release No. 9785 (May 31, 1977). <PAGE>
Comment 4: Tandy requirements -------------------------------------------------------------------------------- Comment: The SEC is now requiring all registrants to provide at the end of response letters to registration statement comments, the following statements: o Each Fund is responsible for the adequacy and accuracy of the disclosure in the filing. o Staff comments or changes in response to staff comments in the filings reviewed by the staff do not foreclose the Commission from taking any action with respect to the filing. o Each Fund may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Response: As required by the SEC, we will provide the foregoing acknowledgements.
* * * * *
As required by the SEC, each Fund acknowledges that:
o The Fund is responsible for the adequacy and accuracy of the disclosure in the filing. o Staff comments or changes in response to staff comments in the filings reviewed by the staff do not foreclose the Commission from taking any action with respect to the filing. o The Fund may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Please contact me at (610) 669-1538 with any questions or comments regarding the above responses. Thank you.
Sincerely,
Judith L. Gaines
Associate Counsel
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[SHIP LOGO]
[THE VANGUARD GROUP(R) LOGO]
March 10, 2005
Christian Sandoe, Esq.
Division of Investment Management
U.S. Securities and Exchange Commission via electronic filing
450 Fifth Street, N.W., Fifth Floor
Washington, D.C. 20549
Re: Vanguard New York Tax-Free Funds
Vanguard Florida Tax-Free Fund
Vanguard Massachusetts Tax-Exempt Funds
Vanguard New Jersey Tax-Free Funds
Vanguard New York Tax-Free Funds
Vanguard Ohio Tax-Free Funds
Vanguard Pennsylvania Tax-Free Funds
Dear Mr. Sandoe:
The following responds to your comments of March 9, 2005 on the
post-effective amendment of the registration statement of each of the
above-referenced registrants. You commented on Post-Effective Amendments for
each registrant that were filed on January 21, 2005 pursuant to Rule 485(a).
Comment 1: Prospectus - Each Registrant
--------------------------------------------------------------------------------
Comment: In each fund's prospectus, Vanguard provides the dollar
weighted average maturity range. Please add the dollar
weighted average maturity as of a particular date, for
example, each fund's fiscal year end.
Response: We do not plan to add the requested disclosure. It is not
required of us by Form N-1A, and while we agree that both the
range and the figure as of the fiscal year end are
informative, the latter is disclosed in each fund's
shareholder report, where both existing and prospective
investors can access it.
Comment 2: Prospectus - California Intermediate-Term Tax-Exempt Fund
--------------------------------------------------------------------------------
Comment: The Primary Investment Strategies section states that the
dollar-weighted average maturity for the Fund will be 6-12
years. Rule 35d-1 refers to 3-10 years for intermediate-term
bond funds.
<PAGE>
Response: The guide referred to in the adopting release for rule 35d-1
assumes, with respect to maturity, that bond funds come in
three -- and only three -- categories: short-, intermediate-,
and long-term. Although this is a common categorization, it is
not the one Vanguard uses for its tax-exempt bond funds.
Vanguard offers four such funds, which are managed to the
following dollar-weighted average maturities:
Short-Term 1-2 years
Limited-Term 2-6
Intermediate-Term 6-12
Long-Term 12-25
Where four categories are used, rather than three, we believe
that any advantage gained by the application of the staff's
uniform standard is outweighed by the disadvantages of placing
a fund into an artificial -- and inappropriate -- maturity
range.
Changing the maturity range for the Fund to 3-10 years would
not be in shareholders' best interests because it would result
in an overlap in the maturity range between Vanguard's
Limited-Term and Intermediate-Term Tax-Exempt Funds. We think
investors are better served with a menu of offerings in which
the average maturities of the funds are clearly delineated and
do not overlap.
We acknowledge that the staff should prevent funds from using
names that are potentially misleading. But under any
reasonable interpretation of the applicable guide and rule
35d-1, an average maturity range of 6-12 years qualifies as
"intermediate-term." The name of Vanguard's California
Intermediate-Term Tax-Exempt Fund is not misleading,
especially when placed in the context of the other tax-exempt
funds offered by Vanguard.
Comment 3: SAI - Investment Limitations
--------------------------------------------------------------------------------
Comment: The SAI does not include a fundamental policy on industry
concentration.
Response: The SEC has stated that "[t]he statement of policy required by
section 8(b)(1) as to concentration is not applicable to
investments in tax-exempt securities issued by governments or
political subdivisions of governments since such issuers are
not members of any industry.1" Accordingly, our state tax-free
funds do not have a policy with respect to industry
concentration. We do not plan to add anything to the SAI in
response to this comment.
----------------------------------
1 Investment Company Act Release No. 9785 (May 31, 1977).
<PAGE>
Comment 4: Tandy requirements
--------------------------------------------------------------------------------
Comment: The SEC is now requiring all registrants to provide at the end
of response letters to registration statement comments, the
following statements:
o Each Fund is responsible for the adequacy and accuracy of
the disclosure in the filing.
o Staff comments or changes in response to staff comments in
the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the
filing.
o Each Fund may not assert staff comments as a defense in
any proceeding initiated by the Commission or any person
under the federal securities laws of the United States.
Response: As required by the SEC, we will provide the foregoing
acknowledgements.
* * * * *
As required by the SEC, each Fund acknowledges that:
o The Fund is responsible for the adequacy and accuracy of the disclosure in the
filing.
o Staff comments or changes in response to staff comments in the filings
reviewed by the staff do not foreclose the Commission from taking any action
with respect to the filing.
o The Fund may not assert staff comments as a defense in any proceeding
initiated by the Commission or any person under the federal securities laws of
the United States.
Please contact me at (610) 669-1538 with any questions or comments
regarding the above responses. Thank you.
Sincerely,
Judith L. Gaines
Associate Counsel
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