Form N-CSR FRANKLIN MUNICIPAL SECUR For: May 31
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT INVESTMENT
COMPANIES
Investment Company Act file number 811-06481
Franklin Municipal Securities Trust
(Exact name of registrant as specified in charter)
One Franklin Parkway, San Mateo, CA 94403-1906
(Address of principal executive offices) (Zip code)
Craig S. Tyle, One Franklin Parkway, San Mateo, CA 94403-1906
(Name and address of agent for service)
Registrants telephone number, including area code: 650 312-2000
Date of fiscal year end: 5/31
Date of reporting period: 5/31/20
Item 1. Reports to Stockholders.
Franklin California High Yield Municipal Fund
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Franklin Tennessee Municipal Bond Fund
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Sign up for electronic delivery at franklintempleton.com/edelivery
Internet Delivery of Fund Reports Unless You Request Paper Copies: Effective January 1, 2021, as permitted by the SEC, paper copies of the Funds shareholder reports will no longer be sent by mail, unless you specifically request them from the Fund or your financial intermediary. Instead, the reports will be made available on a website, and you will be notified by mail each time a report is posted and provided with a website link to access the report.
If you already elected to receive shareholder reports electronically, you will not be affected by this change and you need not take any action. If you have not signed up for electronic delivery, we would encourage you to join fellow shareholders who have. You may elect to receive shareholder reports and other communications electronically from the Fund by calling (800) 632-2301 or by contacting your financial intermediary.
You may elect to continue to receive paper copies of all your future shareholder reports free of charge by contacting your financial intermediary or, if you invest directly with a Fund, calling (800) 632-2301 to let the Fund know of your request. Your election to receive reports in paper will apply to all funds held in your account.
SHAREHOLDER LETTER
Not FDIC Insured | May Lose Value | No Bank Guarantee
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franklintempleton.com | Not part of the annual report | 1 |
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Annual Report | franklintempleton.com |
Municipal Bond Market Overview
1. Source: Investment Company Institute.
2. Source: Morningstar. Treasuries, if held to maturity, offer a fixed rate of return and a fixed principal value; their interest payments and principal are guaranteed.
See www.franklintempletondatasources.com for additional data provider information.
franklintempleton.com | Annual Report | 3 |
Franklin California High Yield Municipal Fund
1. The Fund may invest up to 100% of its assets in bonds whose interest payments are subject to federal alternative minimum tax. All or a significant portion of the income on these obligations may be subject to such tax. Distributions of capital gains are generally taxable. To avoid imposition of 28% backup withholding on all Fund distributions and redemption proceeds, U.S. investors must be properly certified on Form W-9 and non-U.S. investors on Form W-8BEN.
2. The distribution amount is the sum of all net investment income distributions for the period shown. Assumes shares were purchased and held for the entire accrual period. Since dividends accrue daily, your actual distributions will vary depending on the date you purchased your shares and any account activity. All Fund distributions will vary depending upon current market conditions, and past distributions are not indicative of future trends.
The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Funds Statement of Investments (SOI).
The SOI begins on page 22.
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FRANKLIN CALIFORNIA HIGH YIELD MUNICIPAL FUND
3. Source: Bureau of Labor Statistics
4. Source: Moodys Investors Service, State government US Medians State debt declined in 2019, but likely to grow in coming years, 5/12/20.
5. This does not indicate S&Ps rating of the Fund.
See www.franklintempletondatasources.com for additional data provider information.
franklintempleton.com | Annual Report | 5 |
FRANKLIN CALIFORNIA HIGH YIELD MUNICIPAL FUND
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FRANKLIN CALIFORNIA HIGH YIELD MUNICIPAL FUND
Performance Summary as of May 31, 2020
The performance tables and graphs do not reflect any taxes that a shareholder would pay on Fund dividends, capital gain distributions, if any, or any realized gains on the sale of Fund shares. Total return reflects reinvestment of the Funds dividends and capital gain distributions, if any, and any unrealized gains or losses. Your dividend income will vary depending on dividends or interest paid by securities in the Funds portfolio, adjusted for operating expenses of each class. Capital gain distributions are net profits realized from the sale of portfolio securities.
Performance as of 5/31/20
Cumulative total return excludes sales charges. Average annual total return includes maximum sales charges. Sales charges will vary depending on the size of the investment and the class of share purchased. The maximum is 3.75% and the minimum is 0%. Class A: 3.75% maximum initial sales charge; Advisor Class: no sales charges. For other share classes, visit franklintempleton.com.
Share Class | |
Cumulative Total Return |
1 |
|
Average Annual Total Return |
2 | ||
A3,4 |
||||||||
1-Year |
+0.43% | -3.33% | ||||||
5-Year |
+21.40% | +3.16% | ||||||
10-Year |
+74.42% | +5.32% | ||||||
Advisor |
||||||||
1-Year |
+0.68% | +0.68% | ||||||
5-Year |
+22.18% | +4.09% | ||||||
10-Year |
+76.23% | +5.83% |
Share Class | |
Distribution Rate |
5 |
|
Taxable Equivalent Distribution Rate |
6 |
|
30-Day Standardized Yield |
7 |
|
Taxable Equivalent 30-Day Standardized Yield |
6 | ||||
A |
3.03% | 6.46% | 2.66% | 5.67% | ||||||||||||
Advisor |
3.38% | 7.21% | 3.01% | 6.42% |
Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.
See page 9 for Performance Summary footnotes.
franklintempleton.com | Annual Report | 7 |
FRANKLIN CALIFORNIA HIGH YIELD MUNICIPAL FUND
PERFORMANCE SUMMARY
Total Return Index Comparison for a Hypothetical $10,000 Investment
Total return represents the change in value of an investment over the periods shown. It includes any applicable maximum sales charge, Fund expenses, account fees and reinvested distributions. The unmanaged indexes include reinvestment of any income or distributions. They differ from the Fund in composition and do not pay management fees or expenses. One cannot invest directly in an index.
Class A (6/1/105/31/20)
Advisor Class (6/1/105/31/20)
See page 9 for Performance Summary footnotes.
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FRANKLIN CALIFORNIA HIGH YIELD MUNICIPAL FUND
PERFORMANCE SUMMARY
Each class of shares is available to certain eligible investors and has different annual fees and expenses, as described in the prospectus.
All investments involve risks, including loss of principal. Because municipal bonds are sensitive to interest-rate movements, the Funds yield and share price will fluctuate with market conditions. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in the Fund adjust to a rise in interest rates, the Funds share price may decline. Because the Fund invests principally in a single state, it is subject to greater risk of adverse economic and regulatory changes in that state than a geographically diversified fund. Investments in lower-rated bonds include higher risk of default and loss of principal. Puerto Rico municipal bonds have been impacted by recent adverse economic and market changes, which may cause the Funds share price to decline. Changes in the credit rating of a bond, or in the credit rating or financial strength of a bonds issuer, insurer or guarantor, may affect the bonds value. The Fund may invest a significant part of its assets in municipal securities that finance similar types of projects, such as utilities, hospitals, higher education and transportation. A change that affects one project would likely affect all similar projects, thereby increasing market risk. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the marketin general, in ways that cannot necessarily be foreseen. The Funds prospectus also includes a description of the main investment risk.
1. Cumulative total return represents the change in value of an investment over the periods indicated.
2. Average annual total return represents the average annual change in value of an investment over the periods indicated. Return for less than one year, if any, has not been annualized.
3. Effective 9/10/18, Class A shares closed to new investors, were renamed Class A1 shares, and a new Class A share with a different expense structure became available.
Class A performance shown has been calculated as follows: (a) for periods prior to 9/10/18, a restated figure is used based on the Funds Class A1 performance that includes any Rule 12b-1 rate differential that exists between Class A1 and Class A; and (b) for periods after 9/10/18, actual Class A performance is used, reflecting all charges and fees applicable to that class.
4. Prior to 3/1/19, these shares were offered at a higher initial sales charge of 4.25%, thus actual returns (with sales charges) would have differed. Average annual total returns (with sales charges) have been restated to reflect the current maximum initial sales charge of 3.75%.
5. Distribution rate is based on an annualization of the respective classs May dividend and the maximum offering price (NAV for Advisor Class) per share on 5/31/20.
6. Taxable equivalent distribution rate and yield assume the published rates as of 12/19/19 for the maximum combined effective federal and California state personal income
tax rate of 53.10%, based on the federal income tax rate of 37.00% plus 3.80% Medicare tax.
7. The Funds 30-day standardized yield is calculated over a trailing 30-day period using the yield to maturity on bonds and/or the dividends accrued on stocks. It may not equal the Funds actual income distribution rate, which reflects the Funds past dividends paid to shareholders.
8. Source: Morningstar. The Bloomberg Barclays Municipal Bond Index is a market value-weighted index engineered for the long-term tax-exempt bond market. To be included in the index, bonds must be fixed rate, have at least one year to final maturity and be rated investment grade (Baa3/BBB- or higher) by at least two of the following agencies: Moodys, S&P and Fitch.
9. Figures are as stated in the Funds current prospectus and may differ from the expense ratios disclosed in the Your Funds Expenses and Financial Highlights sections in this report. In periods of market volatility, assets may decline significantly, causing total annual Fund operating expenses to become higher than the figures shown.
See www.franklintempletondatasources.com for additional data provider information.
franklintempleton.com | Annual Report | 9 |
FRANKLIN CALIFORNIA HIGH YIELD MUNICIPAL FUND
Your Funds Expenses
As a Fund shareholder, you can incur two types of costs: (1) transaction costs, including sales charges (loads) on Fund purchases and redemptions; and (2) ongoing Fund costs, including management fees, distribution and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses. The table below shows ongoing costs of investing in the Fund and can help you understand these costs and compare them with those of other mutual funds. The table assumes a $1,000 investment held for the six months indicated.
Actual Fund Expenses
The table below provides information about actual account values and actual expenses in the columns under the heading Actual. In these columns the Funds actual return, which includes the effect of Fund expenses, is used to calculate the Ending Account Value for each class of shares. You can estimate the expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number in the row for your class of shares under the headings Actual and Expenses Paid During Period (if Actual Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50). In this illustration, the actual expenses paid this period are $64.50.
Hypothetical Example for Comparison with Other Funds
Under the heading Hypothetical in the table, information is provided about hypothetical account values and hypothetical expenses based on the Funds actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that expenses shown in the table are meant to highlight ongoing costs and do not reflect any transactional costs. Therefore, information under the heading Hypothetical is useful in comparing ongoing costs only, and will not help you compare total costs of owning different funds. In addition, if transactional costs were included, your total costs would have been higher.
Actual (actual return after expenses) |
Hypothetical (5% annual return before expenses) |
|||||||||||||||||
|
|
|||||||||||||||||
Share Class |
Beginning Account Value 12/1/19 |
Ending Account Value 5/31/20 |
Expenses Paid During 12/1/195/31/201, 2 |
Ending Account Value 5/31/20 |
Expenses Paid During Period 12/1/195/31/201, 2 |
Net Annualized Expense Ratio2 | ||||||||||||
|
|
|
| |||||||||||||||
A |
$1,000 | $977.50 | $3.91 | $1,021.05 | $3.99 | 0.79% | ||||||||||||
A1 |
$1,000 | $978.20 | $3.17 | $1,021.80 | $3.23 | 0.64% | ||||||||||||
C |
$1,000 | $974.90 | $5.88 | $1,019.05 | $6.01 | 1.19% | ||||||||||||
R6 |
$1,000 | $978.10 | $2.47 | $1,022.50 | $2.53 | 0.50% | ||||||||||||
Advisor |
$1,000 | $978.80 | $2.67 | $1,022.30 | $2.73 | 0.54% |
1. Expenses are equal to the annualized expense ratio for the six-month period as indicated abovein the far right columnmultiplied by the simple average account value over the period indicated, and then multiplied by 183/366 to reflect the one-half year period.
2. Reflects expenses after fee waivers and expense reimbursements, for Class R6.
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Annual Report | franklintempleton.com |
Franklin Tennessee Municipal Bond Fund
1. The Fund may invest up to 100% of its assets in bonds whose interest payments are subject to federal alternative minimum tax. All or a significant portion of the income on these obligations may be subject to such tax. Distributions of capital gains are generally taxable. To avoid imposition of 28% backup withholding on all Fund distributions and redemption proceeds, U.S. investors must be properly certified on Form W-9 and non-U.S. investors on Form W-8BEN.
2. The distribution amount is the sum of all net investment income distributions for the period shown. Assumes shares were purchased and held for the entire accrual period.
Since dividends accrue daily, your actual distributions will vary depending on the date you purchased your shares and any account activity. All Fund distributions will vary depending upon current market conditions, and past distributions are not indicative of future trends.
The dollar value, number of shares or principal amount, and names of all portfolio holdings are listed in the Funds Statement of Investments (SOI).
The SOI begins on page 44.
franklintempleton.com | Annual Report | 11 |
FRANKLIN TENNESSEE MUNICIPAL BOND FUND
3. Source: Bureau of Labor Statistics
4. Source: Moodys Investors Service, State government US Medians State debt declined in 2019, but likely to grow in coming years, 5/12/20.
5. This does not indicate S&Ps rating of the Fund.
See www.franklintempletondatasources.com for additional data provider information.
12 |
Annual Report | franklintempleton.com |
FRANKLIN TENNESSEE MUNICIPAL BOND FUND
Performance Summary as of May 31, 2020
The performance tables and graphs do not reflect any taxes that a shareholder would pay on Fund dividends, capital gain distributions, if any, or any realized gains on the sale of Fund shares. Total return reflects reinvestment of the Funds dividends and capital gain distributions, if any, and any unrealized gains or losses. Your dividend income will vary depending on dividends or interest paid by securities in the Funds portfolio, adjusted for operating expenses of each class. Capital gain distributions are net profits realized from the sale of portfolio securities.
Performance as of 5/31/20
Cumulative total return excludes sales charges. Average annual total return includes maximum sales charges. Sales charges will vary depending on the size of the investment and the class of share purchased. The maximum is 3.75% and the minimum is 0%. Class A: 3.75% maximum initial sales charge; Advisor Class: no sales charges. For other share classes, visit franklintempleton.com.
Share Class | Cumulative Total Return1 |
Average Annual Total Return2 | ||||||
A3,4 |
||||||||
1-Year |
+2.54% | -1.31% | ||||||
5-Year |
+12.67% | +1.63% | ||||||
10-Year |
+35.97% | +2.73% | ||||||
Advisor5 |
||||||||
1-Year |
+2.79% | +2.79% | ||||||
5-Year |
+13.40% | +2.55% | ||||||
10-Year |
+36.80% | +3.18% |
Share Class | Distribution Rate6 |
Taxable Equivalent Distribution Rate7 |
30-Day Standardized Yield8 |
Taxable Equivalent 30-Day Standardized Yield7 |
||||||||||||
A |
2.36% | 4.05% | 1.32% | 2.27% | ||||||||||||
Advisor |
2.69% | 4.62% | 1.63% | 2.80% |
Performance data represent past performance, which does not guarantee future results. Investment return and principal value will fluctuate, and you may have a gain or loss when you sell your shares. Current performance may differ from figures shown. For most recent month-end performance, go to franklintempleton.com or call (800) 342-5236.
See page 15 for Performance Summary footnotes.
franklintempleton.com | Annual Report | 13 |
FRANKLIN TENNESSEE MUNICIPAL BOND FUND
PERFORMANCE SUMMARY
Total Return Index Comparison for a Hypothetical $10,000 Investment
Total return represents the change in value of an investment over the periods shown. It includes any applicable maximum sales charge, Fund expenses, account fees and reinvested distributions. The unmanaged indexes include reinvestment of any income or distributions. They differ from the Fund in composition and do not pay management fees or expenses. One cannot invest directly in an index.
Class A (6/1/105/31/20)
Advisor Class (6/1/105/31/20)
See page 15 for Performance Summary footnotes.
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Annual Report | franklintempleton.com |
FRANKLIN TENNESSEE MUNICIPAL BOND FUND
PERFORMANCE SUMMARY
Each class of shares is available to certain eligible investors and has different annual fees and expenses, as described in the prospectus.
All investments involve risks, including loss of principal. Because municipal bonds are sensitive to interest-rate movements, the Funds yield and share price will fluctuate with market conditions. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in the Fund adjust to a rise in interest rates, the Funds share price may decline. Because the Fund invests principally in a single state, it is subject to greater risk of adverse economic and regulatory changes in that state than a geographically diversified fund. Puerto Rico municipal bonds have been impacted by recent adverse economic and market changes, which may cause the Funds share price to decline. Changes in the credit rating of a bond, or in the credit rating or financial strength of a bonds issuer, insurer or guarantor, may affect the bonds value. The Fund may invest a significant part of its assets in municipal securities that finance similar types of projects, such as utilities, hospitals, higher education and transportation. A change that affects one project would likely affect all similar projects, thereby increasing market risk. Unexpected events and their aftermaths, such as the spread of deadly diseases; natural, environmental or man-made disasters; financial, political or social disruptions; terrorism and war; and other tragedies or catastrophes, can cause investor fear and panic, which can adversely affect the economies of many companies, sectors, nations, regions and the market in general, in ways that cannot necessarily be foreseen. The Funds prospectus also includes a description of the main investment risks.
1. Cumulative total return represents the change in value of an investment over the periods indicated.
2. Average annual total return represents the average annual change in value of an investment over the periods indicated. Return for less than one year, if any, has not been annualized.
3. Effective 9/10/18, Class A shares closed to new investors, were renamed Class A1 shares, and a new Class A share with a different expense structure became available.
Class A performance shown has been calculated as follows: (a) for periods prior to 9/10/18, a restated figure is used based on the Funds Class A1 performance that includes any Rule 12b-1 rate differential that exists between Class A1 and Class A; and (b) for periods after 9/10/18, actual Class A performance is used, reflecting all charges and fees applicable to that class.
4. Prior to 3/1/19, these shares were offered at a higher initial sales charge of 4.25%, thus actual returns (with sales charges) would have differed. Average annual total returns (with sales charges) have been restated to reflect the current maximum initial sales charge of 3.75%.
5. Effective 9/15/16, the Fund began offering Advisor class shares, which do not have sales charges or a Rule 12b-1 plan. Performance quotations for this class reflect the following methods of calculation: (a) For periods prior to 9/15/16, a restated figure is used based upon the Funds Class A performance, excluding the effect of Class As maximum initial sales charge, but reflecting the effect of the Class A Rule 12b-1 fees; and (b) for periods after 9/15/16, actual Advisor class performance is used reflecting all charges and fees applicable to that class.
6. Distribution rate is based on an annualization of the respective classs May dividend and the maximum offering price (NAV for Advisor Class) per share on 5/31/20.
7. Taxable equivalent distribution rate and yield assume the published rates as of 5/31/20 for the maximum combined effective federal and Tennessee state personal income tax rate of 41.80%, based on the federal income tax rate of 37.00% plus 3.80% Medicare tax.
8. The Funds 30-day standardized yield is calculated over a trailing 30-day period using the yield to maturity on bonds and/or the dividends accrued on stocks. It may not equal the Funds actual income distribution rate, which reflects the Funds past dividends paid to shareholders.
9. Source: Morningstar. The Bloomberg Barclays Municipal Bond Index is a market value weighted index engineered for the long-term tax-exempt bond market. To be included in the index, bonds must be fixed rate, have at least one year to final maturity and be rated investment grade (Baa3/BBB- or higher) by at least two of the following agencies: Moodys, S&P and Fitch.
10. Figures are as stated in the Funds current prospectus and may differ from the expense ratios disclosed in the Your Funds Expenses and Financial Highlights sections in this report. In periods of market volatility, assets may decline significantly, causing total annual Fund operating expenses to become higher than the figures shown.
See www.franklintempletondatasources.com for additional data provider information.
franklintempleton.com | Annual Report | 15 |
FRANKLIN TENNESSEE MUNICIPAL BOND FUND
Your Funds Expenses
As a Fund shareholder, you can incur two types of costs: (1) transaction costs, including sales charges (loads) on Fund purchases and redemptions; and (2) ongoing Fund costs, including management fees, distribution and service (12b-1) fees, and other Fund expenses. All mutual funds have ongoing costs, sometimes referred to as operating expenses. The table below shows ongoing costs of investing in the Fund and can help you understand these costs and compare them with those of other mutual funds. The table assumes a $1,000 investment held for the six months indicated.
Actual Fund Expenses
The table below provides information about actual account values and actual expenses in the columns under the heading Actual. In these columns the Funds actual return, which includes the effect of Fund expenses, is used to calculate the Ending Account Value for each class of shares. You can estimate the expenses you paid during the period by following these steps (of course, your account value and expenses will differ from those in this illustration): Divide your account value by $1,000 (if your account had an $8,600 value, then $8,600 ÷ $1,000 = 8.6). Then multiply the result by the number in the row for your class of shares under the headings Actual and Expenses Paid During Period (if Actual Expenses Paid During Period were $7.50, then 8.6 x $7.50 = $64.50). In this illustration, the actual expenses paid this period are $64.50.
Hypothetical Example for Comparison with Other Funds
Under the heading Hypothetical in the table, information is provided about hypothetical account values and hypothetical expenses based on the Funds actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Funds actual return. This information may not be used to estimate the actual ending account balance or expenses you paid for the period, but it can help you compare ongoing costs of investing in the Fund with those of other funds. To do so, compare this 5% hypothetical example for the class of shares you hold with the 5% hypothetical examples that appear in the shareholder reports of other funds.
Please note that expenses shown in the table are meant to highlight ongoing costs and do not reflect any transactional costs. Therefore, information under the heading Hypothetical is useful in comparing ongoing costs only, and will not help you compare total costs of owning different funds. In addition, if transactional costs were included, your total costs would have been higher.
Actual (actual return after expenses) |
Hypothetical (5% annual return before expenses) |
|||||||||||||||||||||||||||||||||||
Share Class |
Beginning Account Value 12/1/19 |
Ending Account Value 5/31/20 |
Expenses Paid During 12/1/195/31/201, 2 |
Ending Account Value 5/31/20 |
Expenses Paid During 12/1/195/31/201, 2 |
Net Annualized Expense Ratio2 | ||||||||||||||||||||||||||||||
A |
$1,000 | $1,008.80 | $4.67 | $1,020.35 | $4.70 | 0.93 | % | |||||||||||||||||||||||||||||
A1 |
$1,000 | $1,009.50 | $3.92 | $1,021.10 | $3.94 | 0.78 | % | |||||||||||||||||||||||||||||
R6 |
$1,000 | $1,010.20 | $3.27 | $1,021.75 | $3.29 | 0.65 | % | |||||||||||||||||||||||||||||
Advisor |
$1,000 | $1,010.00 | $3.42 | $1,021.60 | $3.44 | 0.68 | % |
1. Expenses are equal to the annualized expense ratio for the six-month period as indicated abovein the far right columnmultiplied by the simple average account value over the period indicated, and then multiplied by 183/366 to reflect the one-half year period.
2. Reflects expenses after fee waivers and expense reimbursements, for Class R6.
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Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
Financial Highlights
Franklin California High Yield Municipal Fund
Year Ended May 31, | ||||||||
2020 | 2019a | |||||||
Class A |
||||||||
Per share operating performance |
||||||||
(for a share outstanding throughout the year) |
||||||||
Net asset value, beginning of year |
$11.10 | $10.70 | ||||||
Income from investment operationsb: |
||||||||
Net investment incomec |
0.34 | 0.27 | ||||||
Net realized and unrealized gains (losses) |
(0.29 | ) | 0.41 | |||||
Total from investment operations |
0.05 | 0.68 | ||||||
Less distributions from: |
||||||||
Net investment income |
(0.34 | ) | (0.28 | ) | ||||
Net asset value, end of year |
$10.81 | $11.10 | ||||||
Total returnd |
0.43% | 6.56% | ||||||
Ratios to average net assetse |
||||||||
Expensesf |
0.80% | 0.83% | ||||||
Net investment income |
3.10% | 3.55% | ||||||
Supplemental data |
||||||||
Net assets, end of year (000s) |
$425,757 | $244,196 | ||||||
Portfolio turnover rate |
23.29% | 13.91% |
aFor the period September 10, 2018 (effective date) to May 31, 2019.
bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
cBased on average daily shares outstanding.
dTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
eRatios are annualized for periods less than one year.
fBenefit of expense reduction rounds to less than 0.01%.
franklintempleton.com | The accompanying notes are an integral part of these financial statements. | Annual Report | 17 |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL HIGHLIGHTS
Franklin California High Yield Municipal Fund (continued)
Year Ended May 31, | ||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||||||
Class A1 |
||||||||||||||||||||
Per share operating performance |
||||||||||||||||||||
(for a share outstanding throughout the year) |
||||||||||||||||||||
Net asset value, beginning of year |
$11.08 | $10.70 | $10.89 | $11.10 | $10.65 | |||||||||||||||
Income from investment operationsa: |
||||||||||||||||||||
Net investment incomeb |
0.36 | 0.40 | 0.39 | 0.40 | 0.41 | |||||||||||||||
Net realized and unrealized gains (losses) |
(0.29 | ) | 0.39 | (0.19 | ) | (0.22 | ) | 0.46 | ||||||||||||
Total from investment operations |
0.07 | 0.79 | 0.20 | 0.18 | 0.87 | |||||||||||||||
Less distributions from: |
||||||||||||||||||||
Net investment income |
(0.36 | ) | (0.41 | ) | (0.39 | ) | (0.39 | ) | (0.42 | ) | ||||||||||
Net asset value, end of year |
$10.79 | $11.08 | $10.70 | $10.89 | $11.10 | |||||||||||||||
Total returnc |
0.58% | 7.56% | 1.92% | 1.71% | 8.37% | |||||||||||||||
Ratios to average net assets |
||||||||||||||||||||
Expenses |
0.65% | d | 0.68% | d | 0.66% | 0.63% | 0.65% | |||||||||||||
Net investment income |
3.25% | 3.70% | 3.63% | 3.66% | 3.83% | |||||||||||||||
Supplemental data |
||||||||||||||||||||
Net assets, end of year (000s) |
$1,282,022 | $1,386,291 | $1,378,169 | $1,377,514 | $1,442,703 | |||||||||||||||
Portfolio turnover rate |
23.29% | 13.91% | 11.08% | 19.73% | 12.23% |
aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
bBased on average daily shares outstanding.
cTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable.
dBenefit of expense reduction rounds to less than 0.01%.
18 |
Annual Report | The accompanying notes are an integral part of these financial statements. | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL HIGHLIGHTS
Franklin California High Yield Municipal Fund (continued)
Year Ended May 31, | ||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||||||
Class C |
||||||||||||||||||||
Per share operating performance |
||||||||||||||||||||
(for a share outstanding throughout the year) |
||||||||||||||||||||
Net asset value, beginning of year |
$11.17 | $10.78 | $10.97 | $11.17 | $10.72 | |||||||||||||||
Income from investment operationsa: |
||||||||||||||||||||
Net investment incomeb |
0.30 | 0.34 | 0.33 | 0.34 | 0.36 | |||||||||||||||
Net realized and unrealized gains (losses) |
(0.30 | ) | 0.40 | (0.19 | ) | (0.21 | ) | 0.45 | ||||||||||||
Total from investment operations |
| 0.74 | 0.14 | 0.13 | 0.81 | |||||||||||||||
Less distributions from: |
||||||||||||||||||||
Net investment income |
(0.30 | ) | (0.35 | ) | (0.33 | ) | (0.33 | ) | (0.36 | ) | ||||||||||
Net asset value, end of year |
$10.87 | $11.17 | $10.78 | $10.97 | $11.17 | |||||||||||||||
Total returnc |
(0.04 | )% | 7.01% | 1.34% | 1.22% | 7.73% | ||||||||||||||
Ratios to average net assets |
||||||||||||||||||||
Expenses |
1.20% | d | 1.23% | d | 1.21% | 1.18% | 1.20% | |||||||||||||
Net investment income |
2.70% | 3.15% | 3.08% | 3.11% | 3.28% | |||||||||||||||
Supplemental data |
||||||||||||||||||||
Net assets, end of year (000s) |
$253,579 | $272,186 | $327,022 | $358,308 | $377,550 | |||||||||||||||
Portfolio turnover rate |
23.29% | 13.91% | 11.08% | 19.73% | 12.23% |
aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
bBased on average daily shares outstanding.
cTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable.
dBenefit of expense reduction rounds to less than 0.01%.
franklintempleton.com | The accompanying notes are an integral part of these financial statements. | Annual Report | 19 |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL HIGHLIGHTS
Franklin California High Yield Municipal Fund (continued)
Year Ended May 31, | ||||||||||||
2020 | 2019 | 2018a | ||||||||||
Class R6 |
||||||||||||
Per share operating performance |
||||||||||||
(for a share outstanding throughout the year) |
||||||||||||
Net asset value, beginning of year |
$11.12 | $10.74 | $10.88 | |||||||||
Income from investment operationsb: |
||||||||||||
Net investment incomec |
0.38 | 0.41 | 0.35 | |||||||||
Net realized and unrealized gains (losses) |
(0.30 | ) | 0.39 | (0.15 | ) | |||||||
Total from investment operations |
0.08 | 0.80 | 0.20 | |||||||||
Less distributions from: |
||||||||||||
Net investment income |
(0.38 | ) | (0.42 | ) | (0.34 | ) | ||||||
Net asset value, end of year |
$10.82 | $11.12 | $10.74 | |||||||||
Total returnd |
0.63% | 7.66% | 1.84% | |||||||||
Ratios to average net assetse |
||||||||||||
Expenses before waiver and payments by affiliates and expense reduction |
0.52% | 0.57% | 0.55% | |||||||||
Expenses net of waiver and payments by affiliates and expense reduction |
0.51% | f | 0.55% | f | 0.53% | |||||||
Net investment income |
3.39% | 3.83% | 3.76% | |||||||||
Supplemental data |
||||||||||||
Net assets, end of year (000s) |
$26,741 | $21,214 | $13,004 | |||||||||
Portfolio turnover rate |
23.29% | 13.91% | 11.08% |
aFor the period August 1, 2017 (effective date) to May 31, 2018.
bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
cBased on average daily shares outstanding.
dTotal return is not annualized for periods less than one year.
eRatios are annualized for periods less than one year.
fBenefit of expense reduction rounds to less than 0.01%.
20 |
Annual Report | The accompanying notes are an integral part of these financial statements. | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL HIGHLIGHTS
Franklin California High Yield Municipal Fund (continued)
Year Ended May 31, | ||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||||||
Advisor Class |
||||||||||||||||||||
Per share operating performance |
||||||||||||||||||||
(for a share outstanding throughout the year) |
||||||||||||||||||||
Net asset value, beginning of year |
$11.11 | $10.73 | $10.91 | $11.12 | $10.67 | |||||||||||||||
Income from investment operationsa: |
||||||||||||||||||||
Net investment incomeb |
0.37 | 0.41 | 0.40 | 0.41 | 0.43 | |||||||||||||||
Net realized and unrealized gains (losses) |
(0.29 | ) | 0.39 | (0.18 | ) | (0.22 | ) | 0.45 | ||||||||||||
Total from investment operations |
0.08 | 0.80 | 0.22 | 0.19 | 0.88 | |||||||||||||||
Less distributions from: |
||||||||||||||||||||
Net investment income |
(0.37 | ) | (0.42 | ) | (0.40 | ) | (0.40 | ) | (0.43 | ) | ||||||||||
Net asset value, end of year |
$10.82 | $11.11 | $10.73 | $10.91 | $11.12 | |||||||||||||||
Total return |
0.68% | 7.64% | 2.10% | 1.80% | 8.46% | |||||||||||||||
Ratios to average net assets |
||||||||||||||||||||
Expenses |
0.55% | c | 0.58% | c | 0.56% | 0.53% | 0.55% | |||||||||||||
Net investment income |
3.35% | 3.80% | 3.73% | 3.76% | 3.93% | |||||||||||||||
Supplemental data |
||||||||||||||||||||
Net assets, end of year (000s) |
$903,694 | $889,990 | $748,355 | $720,890 | $635,463 | |||||||||||||||
Portfolio turnover rate |
23.29% | 13.91% | 11.08% | 19.73% | 12.23% |
aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
bBased on average daily shares outstanding.
cBenefit of expense reduction rounds to less than 0.01%.
franklintempleton.com | The accompanying notes are an integral part of these financial statements. | Annual Report | 21 |
FRANKLIN MUNICIPAL SECURITIES TRUST
Statement of Investments, May 31, 2020
Franklin California High Yield Municipal Fund
Principal Amount |
Value | |||||||
Municipal Bonds 93.2% |
||||||||
California 90.7% |
||||||||
ABAG Finance Authority for Nonprofit Corporations Revenue, Episcopal Senior Communities, Refunding, 6.125%, 7/01/41 |
$ | 7,500,000 | $ | 7,627,275 | ||||
Alameda Special Tax, CFD No. 13-1, Alameda Landing Public Improvements, 5.00%, 9/01/46 |
1,400,000 | 1,527,204 | ||||||
Artesia RDA Tax Allocation, |
||||||||
Artesia Redevelopment Project Area, 5.50%, 6/01/42 |
6,355,000 | 6,361,609 | ||||||
Artesia Redevelopment Project Area, 5.70%, 6/01/42 |
2,755,000 | 2,758,609 | ||||||
Housing Set-Aside, Artesia Redevelopment Project Area, 7.70%, 6/01/46 |
3,115,000 | 3,126,619 | ||||||
Azusa Special Tax, |
||||||||
Community Facilities District No. 2005-1, Rosedale, Improvement Area No. 2, Assured Guaranty Insured, 5.00%, 9/01/44 |
1,500,000 | 1,825,290 | ||||||
Community Facilities District No. 2005-1, Rosedale, Improvemnet Area No. 2, Assured Gauranty Insured, 5.00%, 9/01/49 |
2,100,000 | 2,542,386 | ||||||
Baldwin Park USD, GO, Los Angeles County, Capital Appreciation, Election of 2006, BAM Insured, zero cpn., Pre-Refunded, 8/01/42 |
10,000,000 | 2,720,700 | ||||||
Bay Area Toll Authority Toll Bridge Revenue, San Francisco Bay Area, Subordinate, Series S-4, Pre-Refunded, 5.25%, 4/01/53 |
15,000,000 | 17,137,050 | ||||||
Beaumont Special Tax, |
||||||||
CFD No. 2016-1, Fairway Canyon, 5.00%, 9/01/44 |
300,000 | 331,803 | ||||||
CFD No. 2016-1, Fairway Canyon, 5.00%, 9/01/49 |
400,000 | 440,284 | ||||||
Beaumont USD, GO, Riverside County, Election of 2008, Series C, AGMC Insured, Pre-Refunded, 6.00%, 8/01/41 |
1,925,000 | 2,056,362 | ||||||
California Community Housing Agency Essential Housing Revenue, |
||||||||
Serenity at Larkspur, Series A, 5.00%, 2/01/50 |
46,525,000 | 48,551,629 | ||||||
Verdant at Green Valley Project, Series A, 5.00%, 8/01/49 |
18,000,000 | 18,751,140 | ||||||
California Community Housing Agency Workforce Housing Revenue, Annadel Apartments, Series A, 5.00%, 4/01/49 |
27,050,000 | 28,144,984 | ||||||
California County Tobacco Securitization Agency Tobacco Settlement Revenue, Asset-Backed, Los Angeles County Securitization Corp., 5.70%, 6/01/46 |
3,000,000 | 3,001,560 | ||||||
California Health Facilities Financing Authority Revenue, |
||||||||
Adventist Health System/West, Refunding, Series A, 4.00%, 3/01/39 |
9,000,000 | 9,571,770 | ||||||
California-Nevada Methodist Homes, Refunding, California Mortgage Insured, 5.00%, 7/01/45 |
4,500,000 | 5,150,880 | ||||||
Childrens Hospital Los Angeles, Refunding, Series A, 4.00%, 8/15/49 |
3,375,000 | 3,511,451 | ||||||
El Camino Hospital, 4.00%, 2/01/42 |
6,500,000 | 7,003,100 | ||||||
El Camino Hospital, 5.00%, 2/01/42 |
5,000,000 | 5,825,550 | ||||||
Lucile Salter Packard Childrens Hospital at Stanford, Series A, 5.00%, 8/15/43 |
7,160,000 | 7,943,304 | ||||||
Sutter Health, Refunding, Series B, 5.00%, 11/15/46 |
26,925,000 | 31,134,993 | ||||||
California HFA Municipal Certificates Revenue, Class A, Series 2, 4.00%, 3/20/33 |
55,652 | 56,874 | ||||||
California Infrastructure and Economic Development Bank Revenue, Goodwill Industries of Sacramento Valley and Northern Nevada Project, Series A, 5.00%, 1/01/47 |
10,360,000 | 8,112,294 | ||||||
California Municipal Finance Authority Education Revenue, |
||||||||
American Heritage Education Foundation Project, Refunding, Series A, 5.00%, 6/01/36 |
3,000,000 | 3,180,450 | ||||||
Literacy First Charter Schools Project, Series A, 5.00%, 12/01/39 |
1,145,000 | 1,220,078 | ||||||
Literacy First Charter Schools Project, Series A, 5.00%, 12/01/49 |
2,775,000 | 2,919,106 | ||||||
California Municipal Finance Authority Mobile Home Park Revenue, |
||||||||
Caritas Affordable Housing Inc. Projects, Senior, Series A, 5.00%, 8/15/30 |
1,000,000 | 1,103,320 | ||||||
Caritas Affordable Housing Inc. Projects, Senior, Series A, 5.25%, 8/15/39 |
1,200,000 | 1,307,304 | ||||||
Caritas Affordable Housing Inc. Projects, Senior, Series A, 5.25%, 8/15/49 |
3,500,000 | 3,781,295 | ||||||
Royal York Estates, Series A, 4.00%, 2/15/55. |
2,375,000 | 1,948,521 |
22 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
California Municipal Finance Authority Mobile Home Park Revenue, (continued) |
||||||||
Windsor Mobile Country Club, Series A, Pre-Refunded, 5.625%, 11/15/33 |
$ | 1,000,000 | $ | 1,180,880 | ||||
Windsor Mobile Country Club, Series A, Pre-Refunded, 6.00%, 11/15/48 |
4,000,000 | 4,768,840 | ||||||
California PFAR, |
||||||||
Henry Mayo Newhall Hospital, Refunding, 5.00%, 10/15/37 |
1,100,000 | 1,209,296 | ||||||
Henry Mayo Newhall Hospital, Refunding, 5.00%, 10/15/47 |
5,000,000 | 5,400,350 | ||||||
University Housing, NCCD Claremont Properties LLC, Claremont Colleges Project, Series A, 5.00%, 7/01/27 |
1,125,000 | 843,750 | ||||||
University Housing, NCCD Claremont Properties LLC, Claremont Colleges Project, Series A, 5.00%, 7/01/32 |
3,305,000 | 2,478,750 | ||||||
University Housing, NCCD Claremont Properties LLC, Claremont Colleges Project, Series A, 5.00%, 7/01/37 |
4,670,000 | 3,502,500 | ||||||
University Housing, NCCD Claremont Properties LLC, Claremont Colleges Project, Series A, 5.00%, 7/01/47 |
11,210,000 | 8,407,500 | ||||||
California School Finance Authority Charter School Revenue, |
||||||||
Aspire Public Schools-Obligated Group, Refunding, Series B, 5.00%, 8/01/35 |
1,000,000 | 1,058,330 | ||||||
Aspire Public Schools-Obligated Group, Refunding, Series B, 5.00%, 8/01/45 |
1,100,000 | 1,143,560 | ||||||
Classical Academies Project, Refunding, Series A, 5.00%, 10/01/37 |
1,485,000 | 1,503,993 | ||||||
Classical Academies Project, Refunding, Series A, 5.00%, 10/01/44 |
5,610,000 | 5,587,840 | ||||||
Ednovate-Obligated Group, 5.00%, 6/01/48 |
1,000,000 | 995,460 | ||||||
Ednovate-Obligated Group, 5.00%, 6/01/56 |
1,710,000 | 1,681,836 | ||||||
Fenton Charter Public Schools Obligated Group, Series A, 5.00%, 7/01/40 |
750,000 | 763,845 | ||||||
Fenton Charter Public Schools Obligated Group, Series A, 5.00%, 7/01/50 |
750,000 | 756,195 | ||||||
Fenton Charter Public Schools Obligated Group, Series A, 5.00%, 7/01/58 |
1,000,000 | 1,000,550 | ||||||
Larchmont Charter School Project, Series A, 5.00%, 6/01/55 |
2,050,000 | 1,958,836 | ||||||
Rocketship Education-Obligated Group, Series A, 5.00%, 6/01/34 |
750,000 | 751,140 | ||||||
Rocketship Education-Obligated Group, Series A, 5.125%, 6/01/47 |
845,000 | 832,241 | ||||||
Rocketship Education-Obligated Group, Series A, 5.25%, 6/01/52 |
980,000 | 968,024 | ||||||
Rocketship Public Schools-Obligated Group, Series G, 5.00%, 6/01/30 |
315,000 | 323,225 | ||||||
Rocketship Public Schools-Obligated Group, Series G, 5.00%, 6/01/37 |
360,000 | 355,536 | ||||||
Rocketship Public Schools-Obligated Group, Series G, 5.00%, 6/01/47 |
1,720,000 | 1,663,120 | ||||||
Summit Public Schools-Obligated Group, 5.00%, 6/01/47 |
1,500,000 | 1,549,500 | ||||||
California School Finance Authority Educational Facility Revenue, |
||||||||
River Springs Charter School, Series A, 5.00%, 7/01/30 |
2,000,000 | 2,083,720 | ||||||
River Springs Charter School, Series A, 5.00%, 7/01/37 |
2,000,000 | 1,986,300 | ||||||
River Springs Charter School, Series A, 5.00%, 7/01/47 |
1,975,000 | 1,882,057 | ||||||
River Springs Charter School, Series A, 5.00%, 7/01/52 |
1,340,000 | 1,262,535 | ||||||
California School Finance Authority School Facility Revenue, |
||||||||
Alliance for College-Ready Public Schools Projects, Series C, 5.00%, 7/01/46 |
10,000,000 | 10,523,900 | ||||||
Granada Hills Charter High School, 5.00%, 7/01/43 |
3,000,000 | 3,145,290 | ||||||
Granada Hills Charter Obligated Group, 5.00%, 7/01/49 |
5,750,000 | 5,987,935 | ||||||
Green Dot Public Schools California Projects, Series A, 5.00%, 8/01/35 |
2,525,000 | 2,674,707 | ||||||
Green Dot Public Schools California Projects, Series A, 5.00%, 8/01/38 |
1,000,000 | 1,078,960 | ||||||
Green Dot Public Schools California Projects, Series A, 5.00%, 8/01/45 |
3,500,000 | 3,645,215 | ||||||
Green Dot Public Schools California Projects, Series A, 5.00%, 8/01/48 |
1,750,000 | 1,855,088 | ||||||
Kipp LA Projects, Series A, 5.00%, 7/01/35 |
1,200,000 | 1,289,388 | ||||||
Kipp LA Projects, Series A, 5.00%, 7/01/45 |
1,675,000 | 1,767,963 |
franklintempleton.com | Annual Report | 23 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
California School Finance Authority School Facility Revenue, (continued) |
||||||||
Kipp LA Projects, Series A, 5.00%, 7/01/47 |
$ | 1,500,000 | $ | 1,608,150 | ||||
Kipp Social Projects, Series A, 5.00%, 7/01/39 |
1,000,000 | 1,100,540 | ||||||
Kipp Social Projects, Series A, 5.00%, 7/01/54 |
3,300,000 | 3,563,076 | ||||||
California State Community College Financing Authority College Housing Revenue, NCCD - Orange Coast Properties LLC - Orange Coast College Project, 5.25%, 5/01/53 |
6,250,000 | 6,371,250 | ||||||
California State Educational Facilities Authority Revenue, |
||||||||
Art Center College of Design, Refunding, Series A, 5.00%, 12/01/44 |
1,610,000 | 1,690,033 | ||||||
Art Center College of Design, Refunding, Series A, 5.00%, 12/01/48 |
9,000,000 | 9,417,780 | ||||||
Chapman University, 5.00%, 4/01/40 |
5,000,000 | 5,513,650 | ||||||
Loma Linda University, Refunding, Series A, 5.00%, 4/01/42 |
8,500,000 | 9,291,690 | ||||||
Refunding, Series A, 5.00%, 12/01/37 |
1,265,000 | 1,353,057 | ||||||
Refunding, Series A, 5.00%, 12/01/38 |
1,125,000 | 1,199,914 | ||||||
Stanford University, Series V-1, 5.00%, 5/01/49 |
10,000,000 | 16,508,300 | ||||||
University of the Pacific, Refunding, 5.00%, 11/01/36 |
3,000,000 | 3,363,600 | ||||||
University of San Francisco, Pre-Refunded, 6.125%, 10/01/36 |
980,000 | 1,052,598 | ||||||
University of San Francisco, Refunding, 6.125%, 10/01/36 |
1,020,000 | 1,095,562 | ||||||
California State GO, |
||||||||
Various Purpose, Refunding, 5.25%, 3/01/30 |
5,000,000 | 5,018,000 | ||||||
Various Purpose, Refunding, 5.00%, 3/01/45 |
3,900,000 | 4,489,992 | ||||||
California State Infrastructure and Economic Development Bank National Charter Revenue, |
||||||||
Equitable School Revolving Fund, Series B, 5.00%, 11/01/39 |
300,000 | 352,725 | ||||||
Equitable School Revolving Fund, Series B, 5.00%, 11/01/44 |
350,000 | 406,970 | ||||||
Equitable School Revolving Fund, Series B, 5.00%, 11/01/49 |
350,000 | 404,915 | ||||||
California State Muni Finance Authority Senior Living Revenue, MT San Antonio Gardens Project, Refunding, 5.00%, 11/15/39 |
2,300,000 | 2,331,073 | ||||||
California State Municipal Finance Authority Charter School Lease Revenue, |
||||||||
Santa Rosa Academy Project, 5.125%, 7/01/35 |
450,000 | 459,351 | ||||||
Santa Rosa Academy Project, 5.375%, 7/01/45 |
1,400,000 | 1,423,240 | ||||||
California State Municipal Finance Authority Charter School Revenue, |
||||||||
King/Chavez Academy of Excellence Project, Refunding and Improvement, Series A, 5.00%, 5/01/36 |
2,480,000 | 2,512,810 | ||||||
King/Chavez Academy of Excellence Project, Refunding and Improvement, Series A, 5.00%, 5/01/46 |
2,775,000 | 2,758,905 | ||||||
The Palmdale Aerospace Academy Project, Series A, 3.875%, 7/01/28 |
1,400,000 | 1,374,702 | ||||||
The Palmdale Aerospace Academy Project, Series A, 5.00%, 7/01/31 |
1,000,000 | 1,032,750 | ||||||
The Palmdale Aerospace Academy Project, Series A, 5.00%, 7/01/36 |
2,750,000 | 2,791,635 | ||||||
The Palmdale Aerospace Academy Project, Series A, 5.00%, 7/01/38 |
1,100,000 | 1,114,553 | ||||||
The Palmdale Aerospace Academy Project, Series A, 5.00%, 7/01/41 |
1,750,000 | 1,757,210 | ||||||
The Palmdale Aerospace Academy Project, Series A, 5.00%, 7/01/49 |
3,600,000 | 3,550,968 | ||||||
California State Municipal Finance Authority Revenue, |
||||||||
Biola University, Refunding, 5.00%, 10/01/36 |
1,100,000 | 1,190,134 | ||||||
Biola University, Refunding, 5.00%, 10/01/39 |
1,000,000 | 1,073,250 | ||||||
California Baptist University, Series A, 5.00%, 11/01/36 |
2,500,000 | 2,554,900 | ||||||
California Baptist University, Series A, 5.375%, 11/01/40 |
5,000,000 | 5,161,850 | ||||||
California Baptist University, Series A, 5.50%, 11/01/45 |
10,000,000 | 10,315,400 | ||||||
Clinicals del Camino Real Inc., 4.00%, 3/01/40 |
2,750,000 | 3,004,292 |
24 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
California State Municipal Finance Authority Revenue, (continued) |
||||||||
Clinicas del Camino Real Inc., 4.00%, 3/01/50 |
$ | 5,000,000 | $ | 5,370,850 | ||||
Community Medical Centers, Refunding, Series A, 5.00%, 2/01/40 |
5,000,000 | 5,491,050 | ||||||
Community Medical Centers, Refunding, Series A, 4.00%, 2/01/42 |
10,000,000 | 10,499,800 | ||||||
The Creative Center of Los Altos Project Pinewood and Oakwood School, Refunding, Series B, 4.00%, 11/01/36 |
1,395,000 | 1,279,606 | ||||||
The Creative Center of Los Altos Project Pinewood and Oakwood School, Refunding, Series B, 4.50%, 11/01/46 |
1,600,000 | 1,465,808 | ||||||
Eisenhower Medical Center, Refunding, Series A, 5.00%, 7/01/37 |
2,625,000 | 2,985,071 | ||||||
Harbor Regional Center Project, Refunding, 5.00%, 11/01/32 |
3,020,000 | 3,596,246 | ||||||
Harbor Regional Center Project, Refunding, 5.00%, 11/01/39 |
6,525,000 | 7,669,289 | ||||||
Humangood Obligated Group, Refunding, Series A, 5.00%, 10/01/44 |
12,885,000 | 13,250,032 | ||||||
Inland Regional Center Project, Refunding, 5.00%, 6/15/37 |
9,965,000 | 11,822,576 | ||||||
Kern Regional Center Project, Refunding, Series A, 5.00%, 5/01/49 |
3,895,000 | 4,597,775 | ||||||
LINXS APM Project, senior lien, Series A, 5.00%, 12/31/43 |
20,665,000 | 22,436,404 | ||||||
LINXS APM Project, senior lien, Series A, 4.00%, 12/31/47 |
6,085,000 | 6,086,643 | ||||||
LINXS APM Project, senior lien, Series A, 5.00%, 12/31/47 |
15,500,000 | 16,765,265 | ||||||
NorthBay Healthcare Group, 5.00%, 11/01/35 |
1,100,000 | 1,180,344 | ||||||
NorthBay Healthcare Group, 5.00%, 11/01/44 |
1,050,000 | 1,107,551 | ||||||
NorthBay Healthcare Group, Series A, 5.25%, 11/01/47 |
3,000,000 | 3,257,370 | ||||||
South Central Los Angeles Regional Center Project, 5.50%, 12/01/33 |
3,115,000 | 3,452,386 | ||||||
South Central Los Angeles Regional Center Project, 5.75%, 12/01/43 |
7,000,000 | 7,743,330 | ||||||
Town and Country Manor, Refunding, California Mortgage Insured, 5.00%, 7/01/39 |
1,000,000 | 1,231,470 | ||||||
Town and Country Manor, Refunding, California Mortgage Insured, 5.00%, 7/01/49 |
2,650,000 | 3,206,579 | ||||||
University of La Verne, Refunding, Series A, 5.00%, 6/01/43 |
5,000,000 | 5,620,650 | ||||||
California State Municipal Finance Authority Senior Living Revenue, MT San Antonio Gardens Project, Refunding, 5.00%, 11/15/49 |
850,000 | 842,214 | ||||||
California State Municipal Finance Authority Special Facility Revenue, United Airlines Inc. Los Angeles International Airport Project, 4.00%, 7/15/29 |
8,500,000 | 8,179,720 | ||||||
California State Municipal Finance Authority Special Tax Revenue, |
||||||||
Series A, 4.00%, 9/01/35 |
1,135,000 | 1,206,108 | ||||||
Series A, 4.00%, 9/01/40 |
1,450,000 | 1,496,313 | ||||||
California State Municipal Finance Authority Student Housing Revenue, |
||||||||
Bowles Hall Foundation, Series A, 5.00%, 6/01/35 |
600,000 | 631,554 | ||||||
Bowles Hall Foundation, Series A, 5.00%, 6/01/50 |
3,250,000 | 3,366,545 | ||||||
CHF-Davis I, LLC-West Village Student Housing Project, 5.00%, 5/15/51 |
5,000,000 | 5,364,800 | ||||||
CHF-Riverside I LLC - UCR Dundee-Glasgow Student Housing Project, 5.00%, 5/15/43 |
1,500,000 | 1,621,980 | ||||||
CHF-Riverside II LLC-UCR North District Phase 1 Student Housing Project, 5.00%, 5/15/41 |
1,450,000 | 1,586,416 | ||||||
CHF-Riverside II LLC-UCR North District Phase 1 Student Housing Project, 5.00%, 5/15/49 |
9,575,000 | 10,352,777 | ||||||
CHF-Riverside II LLC-UCR North District Phase 1 Student Housing Project, 5.00%, 5/15/52 |
775,000 | 836,434 | ||||||
California State PCFA Solid Waste Disposal Revenue, |
||||||||
CalPlant I Project, Green Bonds, 7.00%, 7/01/22 |
3,500,000 | 1,890,000 | ||||||
CalPlant I Project, Green Bonds, 7.50%, 7/01/32 |
13,000,000 | 7,020,000 | ||||||
CalPlant I Project, Green Bonds, 8.00%, 7/01/39 |
11,500,000 | 6,210,000 | ||||||
California State PCFA Water Furnishing Revenue, 5.00%, 11/21/45 |
19,965,000 | 20,479,498 |
franklintempleton.com | Annual Report | 25 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
California State Public Works Board Lease Revenue, |
||||||||
Department of Corrections and Rehabilitation, California State Prison Los Angeles, Various Buildings, Series C, 5.75%, 10/01/31 |
$ | 4,640,000 | $ | 4,952,226 | ||||
Various Capital Projects, Series A, 5.125%, 10/01/31 |
3,605,000 | 3,815,820 | ||||||
California State School Financial Authority Charted School Revenue, Aspire Public Schools, Refunding, 5.00%, 8/01/41 |
2,200,000 | 2,298,780 | ||||||
California State University Revenue, Systemwide, Refunding, Series A, 5.00%, 11/01/47 |
14,980,000 | 17,769,426 | ||||||
California Statewide CDA Hospital Revenue, Methodist Hospital of Southern California, Refunding, 5.00%, 1/01/48 |
5,000,000 | 5,588,700 | ||||||
California Statewide CDA College Housing Revenue, |
||||||||
NCCD-Hooper Street LLC-California College of the Arts Project, 5.25%, 7/01/39 |
2,550,000 | 2,571,879 | ||||||
NCCD-Hooper Street LLC-California College of the Arts Project, 5.25%, 7/01/49 |
3,375,000 | 3,335,141 | ||||||
NCCD-Hooper Street LLC-California College of the Arts Project, 5.25%, 7/01/52 |
1,535,000 | 1,509,197 | ||||||
California Statewide CDA Revenue, |
||||||||
Aldersly, Refunding, Series A, 5.00%, 5/15/32 |
750,000 | 781,328 | ||||||
Aldersly, Refunding, Series A, 5.00%, 5/15/40 |
1,010,000 | 1,038,947 | ||||||
Bentley School, Refunding, Series A, 7.00%, 7/01/40 |
8,675,000 | 8,784,825 | ||||||
California Baptist University, Refunding, Series A, 5.00%, 11/01/32 |
1,135,000 | 1,180,559 | ||||||
California Baptist University, Refunding, Series A, 5.00%, 11/01/41 |
1,875,000 | 1,896,919 | ||||||
California Baptist University, Series A, 5.125%, 11/01/23 |
515,000 | 531,073 | ||||||
California Baptist University, Series A, 6.125%, 11/01/33 |
1,565,000 | 1,692,391 | ||||||
California Baptist University, Series A, 6.375%, 11/01/43 |
4,035,000 | 4,340,490 | ||||||
California Baptist University, Series A, Pre-Refunded, 7.25%, 11/01/31 |
1,250,000 | 1,372,100 | ||||||
California Baptist University, Series A, Pre-Refunded, 7.50%, 11/01/41 |
2,750,000 | 3,028,300 | ||||||
Community Infrastructure Program, Series C, 5.00%, 9/02/34 |
1,500,000 | 1,691,730 | ||||||
Covenant Retirement Communities Inc., Series C, 5.625%, 12/01/36 |
8,000,000 | 8,519,760 | ||||||
Enloe Medical Center, Refunding, California Mortgage Insured, 5.00%, 8/15/38 |
6,000,000 | 7,138,500 | ||||||
Eskaton Properties Inc. Obligated Group, Refunding, 5.25%, 11/15/34 |
4,350,000 | 4,463,448 | ||||||
Huntington Memorial Hospital, 5.00%, 7/01/43 |
1,000,000 | 1,123,340 | ||||||
Huntington Memorial Hospital, 4.00%, 7/01/48 |
6,000,000 | 6,520,080 | ||||||
Huntington Memorial Hospital, Refunding, Series B, 5.00%, 7/01/44 |
4,450,000 | 4,827,493 | ||||||
Insured Senior Living Health Facility, Los Angeles Jewish Home for the Aging, Fountainview at Gonda, Series A, California Mortgage Insured, 5.00%, 8/01/44 |
2,450,000 | 2,671,382 | ||||||
Lancer Educational Student Housing Project, Refunding, Series A, 5.00%, 6/01/34 |
375,000 | 377,974 | ||||||
Lancer Educational Student Housing Project, Refunding, Series A, 5.00%, 6/01/46 |
12,735,000 | 12,356,516 | ||||||
Lancer Educational Student Housing Project, Series A, 5.00%, 6/01/39 |
475,000 | 468,697 | ||||||
Loma Linda University Medical Center, Series A, 5.00%, 12/01/41 |
1,245,000 | 1,278,266 | ||||||
Loma Linda University Medical Center, Series A, 5.25%, 12/01/56 |
52,005,000 | 52,845,401 | ||||||
Marin General Hospital, Green Bonds, Series A, 4.00%, 8/01/45 |
1,500,000 | 1,555,980 | ||||||
Statewide Community Infrastructure Program, Emerson Ranch Project, 5.00%, 9/02/35 |
2,000,000 | 2,196,800 | ||||||
Statewide Community Infrastructure Program, Emerson Ranch Project, 5.00%, 9/02/45 |
3,810,000 | 4,113,924 | ||||||
Statewide Community Infrastructure Program, Refunding, Series R1, 5.00%, 9/02/40 |
2,230,000 | 2,333,360 | ||||||
Statewide Community Infrastructure Program, Series A, 4.00%, 9/02/27 |
1,995,000 | 2,070,152 | ||||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/36 |
1,035,000 | 1,123,327 | ||||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/37 |
1,975,000 | 2,120,715 | ||||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/38 |
2,150,000 | 2,439,261 | ||||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/39 |
1,700,000 | 1,932,883 |
26 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
California Statewide CDA Revenue, (continued) |
||||||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/44 |
$ | 1,000,000 | $ | 1,126,890 | ||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/45 |
2,250,000 | 2,433,915 | ||||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/46 |
2,460,000 | 2,603,713 | ||||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/47 |
3,750,000 | 4,169,700 | ||||||
Statewide Community Infrastructure Program, Series A, 5.00%, 9/02/48 |
1,000,000 | 1,122,910 | ||||||
Statewide Community Infrastructure Program, Series B, 5.00%, 9/02/34 |
2,000,000 | 2,255,640 | ||||||
Statewide Community Infrastructure Program, Series B, 5.00%, 9/02/37 |
3,260,000 | 3,615,894 | ||||||
Statewide Community Infrastructure Program, Series B, 5.00%, 9/02/38 |
3,000,000 | 3,396,630 | ||||||
Statewide Community Infrastructure Program, Series B, 5.00%, 9/02/39 |
1,060,000 | 1,167,834 | ||||||
Statewide Community Infrastructure Program, Series B, 5.00%, 9/02/43 |
5,095,000 | 5,705,024 | ||||||
Statewide Community Infrastructure Program, Series B, 5.00%, 9/02/47 |
2,540,000 | 2,787,040 | ||||||
Statewide Community Infrastructure Program, Series B, 5.00%, 9/02/48 |
5,000,000 | 5,553,250 | ||||||
Statewide Community Infrastructure Program, Series C, 5.00%, 9/02/37 |
4,970,000 | 5,522,714 | ||||||
Statewide Community Infrastructure Program, Series C, 5.00%, 9/02/38 |
6,000,000 | 6,807,240 | ||||||
Statewide Community Infrastructure Program, Series C, 5.00%, 9/02/39 |
850,000 | 936,471 | ||||||
Statewide Community Infrastructure Program, Series C, 5.00%, 9/02/47 |
1,785,000 | 1,944,293 | ||||||
Statewide Community Infrastructure Program, Series C, 5.00%, 9/02/48 |
6,605,000 | 7,335,843 | ||||||
California Statewide CDA Special Tax Revenue, |
||||||||
CFD No. 2015-01, Improvement Area No. 1, University District, Refunding, Series A, 5.00%, 9/01/36 |
1,000,000 | 1,096,480 | ||||||
CFD No. 2015-01, Improvement Area No. 1, University District, Refunding, Series A, 5.00%, 9/01/45 |
1,500,000 | 1,622,610 | ||||||
CFD No. 2015-01, Improvement Area No. 2, University District, 5.00%, 9/01/27 |
900,000 | 1,007,658 | ||||||
CFD No. 2015-01, Improvement Area No. 2, University District, 5.00%, 9/01/37 |
1,225,000 | 1,379,730 | ||||||
CFD No. 2015-01, Improvement Area No. 2, University District, 5.00%, 9/01/47 |
2,000,000 | 2,213,380 | ||||||
CFD No. 2016-02, Delta Coves, 5.00%, 9/01/39 |
1,230,000 | 1,328,080 | ||||||
CFD No. 2016-02, Delta Coves, 5.00%, 9/01/49 |
3,000,000 | 3,160,200 | ||||||
CFD No. 2016-02, Delta Coves, Series A, 5.00%, 9/01/46 |
11,080,000 | 11,426,361 | ||||||
CFD No. 2018-03, Uptown Newport, 5.00%, 9/01/39 |
1,750,000 | 1,964,410 | ||||||
CFD No. 2018-03, Uptown Newport, 5.00%, 9/01/48 |
2,000,000 | 2,198,640 | ||||||
California Statewide CDA Student Housing Revenue, |
||||||||
University of California, Irvine East Campus Apartments, CHF-Irvine LLC, Refunding, 5.00%, 5/15/40 |
1,500,000 | 1,579,545 | ||||||
University of California, Irvine East Campus Apartments, Phase IV-A, CHF-Irvine LLC, Series A, 5.00%, 5/15/42 |
710,000 | 749,625 | ||||||
Capistrano USD, CFD No. 2005-1 Special Tax, 5.50%, 9/01/43 |
4,955,000 | 5,311,859 | ||||||
Carson RDA, Tax Allocation Housing, Series A, 5.25%, 10/01/36 |
1,965,000 | 1,984,002 | ||||||
Casitas Municipal Water District Special Tax, |
||||||||
CFD No. 2013-1, Ojai, Series B, BAM Insured, 5.00%, 9/01/42 |
8,000,000 | 9,660,400 | ||||||
CFD No. 2013-1, Ojai, Series B, BAM Insured, 5.25%, 9/01/47 |
5,000,000 | 6,083,500 | ||||||
Centinela Valley UHSD, |
||||||||
GO, Los Angeles County, Capital Appreciation, Election of 2010, Refunding, Series B, AGMC Insured, zero cpn., 8/01/45 |
42,000,000 | 10,627,260 | ||||||
GO, Los Angeles County, Election of 2008, Series C, 5.00%, 8/01/35 |
4,195,000 | 4,719,249 | ||||||
Chino CFD No. 2003-3 Special Tax, Improvement Area No. 6, 5.00%, 9/01/45 |
1,665,000 | 1,797,767 | ||||||
Chino CFD No. 2016-2 Special Tax, 5.00%, 9/01/42 |
1,535,000 | 1,682,897 |
franklintempleton.com | Annual Report | 27 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Chula Vista CFD Special Tax No. 16-I, |
||||||||
Improvement Area No. 1, 5.00%, 9/01/43 |
$ | 1,000,000 | $ | 1,107,660 | ||||
Improvement Area No. 1, 5.00%, 9/01/48 |
1,185,000 | 1,305,337 | ||||||
City of Fullerton Special Assessment, |
||||||||
CFD No. 2, Amerige Heights, 5.00%, 9/01/34 |
1,075,000 | 1,146,208 | ||||||
CFD No. 2, Amerige Heights, 5.00%, 9/01/44 |
2,450,000 | 2,583,353 | ||||||
Clovis USD, |
||||||||
GO, Capital Appreciation, Election of 2004, Series A, NATL Insured, zero cpn., 8/01/27 |
6,295,000 | 5,725,240 | ||||||
GO, Capital Appreciation, Election of 2004, Series A, NATL Insured, zero cpn., 8/01/28 |
3,000,000 | 2,668,770 | ||||||
GO, Capital Appreciation, Election of 2004, Series A, Pre-Refunded, zero cpn., 8/01/27 |
1,205,000 | 1,133,965 | ||||||
Coachella Valley USD, |
||||||||
GO, Riverside and Imperial Counties, Capital Appreciation, Election of 2005, Series D, AGMC Insured, zero cpn., 8/01/42 |
8,500,000 | 5,013,640 | ||||||
GO, Riverside and Imperial Counties, Capital Appreciation, Election of 2005, Series D, AGMC Insured, zero cpn., 8/01/43 |
3,000,000 | 1,712,700 | ||||||
Compton CRDA Tax Allocation, |
||||||||
Redevelopment Project, second lien, Series B, 5.70%, 8/01/30 |
2,255,000 | 2,267,493 | ||||||
Redevelopment Project, second lien, Series B, 6.00%, 8/01/42 |
3,460,000 | 3,477,646 | ||||||
Corona CFD No. 2018-1 Special Tax, |
||||||||
Improvement Area No. 1, Bedford, Series A, 5.00%, 9/01/38 |
1,200,000 | 1,283,376 | ||||||
Improvement Area No. 1, Bedford, Series A, 5.00%, 9/01/48 |
1,000,000 | 1,053,520 | ||||||
Corona-Norco USD Special Tax, CFD No. 2005-1, Refunding, 5.00%, 9/01/36 |
500,000 | 560,240 | ||||||
Cotati-Rohnert Park USD, GO, Election of 2014, Series C, BAM Insured, 5.00%, 8/01/45 |
4,000,000 | 4,709,880 | ||||||
CSD San Bernardino County GO, |
||||||||
Election of 2008, Series C, 5.00%, 8/01/44 |
3,615,000 | 4,270,399 | ||||||
Election of 2014, Series A, 5.00%, 8/01/44 |
7,375,000 | 8,712,087 | ||||||
Cudahy Community Development Commission Tax Allocation, City-Wide Redevelopment Project, Redevelopment Projects, Series B, Pre-Refunded, 7.75%, 10/01/27 |
3,795,000 | 4,169,035 | ||||||
Daly City Housing Development Finance Agency Mobile Home Park Revenue, Franciscan Mobile Home Park Acquisition Project, sub. bond, Refunding, Series B, 5.85%, 12/15/47 |
4,595,000 | 4,600,744 | ||||||
Dana Point CFD Special Tax No. 2006-1, |
||||||||
5.00%, 9/01/38 |
1,000,000 | 1,062,490 | ||||||
5.00%, 9/01/45 |
2,500,000 | 2,654,275 | ||||||
Del Mar Race Track Authority Revenue, Refunding, 5.00%, 10/01/35 |
2,000,000 | 1,915,140 | ||||||
Del Mar USD, CFD No. 99-1 Special Tax, Facilities Financing, Refunding, BAM Insured, 4.00%, 9/01/49 |
2,000,000 | 2,302,700 | ||||||
Dixon CFD No. 2013-1 Special Tax, Parklane, 5.00%, 9/01/44 |
2,645,000 | 2,917,065 | ||||||
Duarte RDA Tax Allocation, Capital Appreciation, Merged Redevelopment Project, ETM, zero cpn., 12/01/28 |
21,990,000 | 14,977,169 | ||||||
Dublin CFD No. 1 Special Tax, |
||||||||
Improvement Area No. 1, Dublin Crossing, 5.00%, 9/01/37 |
1,550,000 | 1,752,229 | ||||||
Improvement Area No. 1, Dublin Crossing, 5.00%, 9/01/47 |
4,500,000 | 5,010,750 | ||||||
Improvement Area No. 2, Dublin Crossing, 4.00%, 9/01/21 |
110,000 | 113,150 | ||||||
Improvement Area No. 2, Dublin Crossing, 4.00%, 9/01/23 |
200,000 | 213,858 | ||||||
Improvement Area No. 2, Dublin Crossing, 4.00%, 9/01/24 |
250,000 | 272,373 | ||||||
Improvement Area No. 2, Dublin Crossing, 5.00%, 9/01/25 |
305,000 | 351,448 | ||||||
Improvement Area No. 2, Dublin Crossing, 5.00%, 9/01/26 |
360,000 | 420,379 | ||||||
Improvement Area No. 2, Dublin Crossing, 5.00%, 9/01/29 |
660,000 | 775,520 |
28 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Dublin CFD No. 1 Special Tax, (continued) |
||||||||
Improvement Area No. 2, Dublin Crossing, 5.00%, 9/01/39 |
$ | 3,665,000 | $ | 4,112,277 | ||||
Improvement Area No. 2, Dublin Crossing, 5.00%, 9/01/44 |
6,625,000 | 7,310,422 | ||||||
Improvement Area No.2, Dublin Crossing, 4.00%, 9/01/22 |
155,000 | 162,972 | ||||||
Dublin CFD No. 2015-1 Special Tax, Improvement Area No. 2, Dublin Crossing, 5.00%, 9/01/49 |
2,300,000 | 2,529,241 | ||||||
El Dorado County Special Tax, CFD No. 2014-1, Carson Creek, 5.00%, 9/01/48 |
2,850,000 | 3,109,207 | ||||||
El Rancho USD, GO, Los Angeles County, Capital Appreciation, Election of 2003, NATL Insured, zero cpn., 8/01/29 |
2,400,000 | 2,099,568 | ||||||
Fairfield CFD No. 2016-1 Special Tax Revenue, Villages at Fairfield, Improvement Area, Series A, 5.00%, 9/01/44 |
2,000,000 | 2,192,140 | ||||||
Fillmore Special Tax, |
||||||||
CFD No. 5 Improvement Area A, Heritage Valley Parks, Series A, 5.00%, 9/01/40 |
1,500,000 | 1,601,910 | ||||||
CFD No. 5 Improvement Area A, Heritage Valley Parks, Series A, 5.00%, 9/01/45 |
2,630,000 | 2,800,292 | ||||||
Folsom Ranch Financing Authority Special Tax Revenue, |
||||||||
CCFD No. 21, White Rock Springs Ranch, 5.00%, 9/01/49 |
2,000,000 | 2,189,880 | ||||||
CFD No. 19, Mangini Ranch, 5.00%, 9/01/47 |
3,280,000 | 3,574,806 | ||||||
CFD No. 19, Mangini Ranch, 5.00%, 9/01/49 |
1,825,000 | 1,981,110 | ||||||
CFD No. 20, Russell Ranch, 5.00%, 9/01/28 |
600,000 | 695,448 | ||||||
CFD No. 20, Russell Ranch, 5.00%, 9/01/33 |
530,000 | 596,330 | ||||||
CFD No. 20, Russell Ranch, 5.00%, 9/01/38 |
850,000 | 938,978 | ||||||
CFD No. 20, Russell Ranch, 5.00%, 9/01/48 |
1,675,000 | 1,832,316 | ||||||
Fontana Special Tax, |
||||||||
CFD No. 80, Bella Strada, 5.00%, 9/01/46 |
1,000,000 | 1,095,860 | ||||||
CFD No. 81, Gabriella, 4.00%, 9/01/43 |
1,000,000 | 1,032,060 | ||||||
Foothill/Eastern Transportation Corridor Agency Toll Road Revenue, |
||||||||
Capital Appreciation, Refunding, Series A, zero cpn., 1/15/42 |
75,000,000 | 32,844,000 | ||||||
Capital Appreciation, senior lien, Refunding, Series A, zero cpn., 1/15/33 |
19,000,000 | 12,322,450 | ||||||
junior lien, Refunding, Series C, 6.50%, 1/15/43 |
40,000,000 | 45,176,400 | ||||||
Refunding, Sub Series B-1, 3.95%, 1/15/53 |
25,000,000 | 26,604,500 | ||||||
Subseries B-2, Refunding, Series B, 3.50%, 1/15/53 |
17,500,000 | 17,795,750 | ||||||
Freddie Mac MFH Revenue, Pass - Through ML06Class XCA, 1.106%, 7/25/35 |
140,459,721 | 13,105,496 | ||||||
Fremont CFD No. 1 Special Tax, |
||||||||
Pacific Commons, Refunding, 5.00%, 9/01/40 |
4,655,000 | 5,030,752 | ||||||
Pacific Commons, Refunding, 5.00%, 9/01/45 |
3,255,000 | 3,493,461 | ||||||
Golden State Tobacco Securitization Corp. Enhanced Tobacco Settlement Revenue, Asset-Backed, Series A, 5.00%, 6/01/45 |
37,630,000 | 42,882,772 | ||||||
Golden State Tobacco Securitization Corp. Tobacco Settlement Revenue, |
||||||||
Asset-Backed, Capital Appreciation, Second Subordinate, Refunding, Series C, zero cpn., 6/01/47 |
50,000,000 | 9,247,500 | ||||||
Asset-Backed, Refunding, Series A-1, 5.25%, 6/01/47 |
63,500,000 | 63,910,210 | ||||||
Asset-Backed, Refunding, Series A-2, 5.00%, 6/01/47 |
12,750,000 | 12,760,327 | ||||||
Asset-Backed, Senior, Refunding, Series A-2, 5.30%, 6/01/37 |
5,000,000 | 5,062,350 | ||||||
Hanford Joint UHSD, |
||||||||
GO, Capital Appreciation, Election of 2004, Series B, AGMC Insured, zero cpn., 8/01/32 |
3,635,000 | 2,973,903 | ||||||
GO, Capital Appreciation, Election of 2004, Series B, AGMC Insured, zero cpn., 8/01/33 |
3,705,000 | 2,942,844 | ||||||
GO, Capital Appreciation, Election of 2004, Series B, AGMC Insured, zero cpn., 8/01/35 |
4,120,000 | 3,090,082 | ||||||
Hartnell Community College District GO, Monterey and San Benito Counties, Capital Appreciation, Election of 2002, Series D, zero cpn., 8/01/49 |
10,000,000 | 4,558,500 |
franklintempleton.com | Annual Report | 29 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Imperial Community College District GO, Imperial County, Capital Appreciation, Election of 2010, Series A, AGMC Insured, Pre-Refunded, 6.75%, 8/01/40 |
$ | 3,500,000 | $ | 4,615,835 | ||||
Imperial County Special Tax, CFD No. 98-1, LOC BNP Paribas, 6.50%, 9/01/31 |
5,405,000 | 5,422,999 | ||||||
Independent Cities Finance Authority Mobile Home Park Revenue, |
||||||||
Lamplighter Salinas Mobilehome Park, Series A, Pre-Refunded, 6.25%, 7/15/45 |
2,465,000 | 2,482,625 | ||||||
Lamplighter Salinas Mobilehome Park, Series A, Pre-Refunded, 6.25%, 7/15/50 |
2,000,000 | 2,014,300 | ||||||
Pillar Ridge, Series A, 5.25%, 5/15/44 |
2,015,000 | 2,161,773 | ||||||
Pillar Ridge, Series A, 5.25%, 5/15/49 |
4,800,000 | 5,138,592 | ||||||
San Juan Mobile Estates, Refunding, 5.00%, 8/15/45 |
5,000,000 | 5,448,100 | ||||||
San Juan Mobile Estates, Refunding, 5.00%, 8/15/50 |
4,900,000 | 5,327,329 | ||||||
Union City Tropics, Refunding, 5.00%, 5/15/48 |
3,000,000 | 3,480,270 | ||||||
Indio CFD Special Tax, No. 2004-3, Terra Lago, Improvement Area No. 1, Refunding, 5.00%, 9/01/35 |
1,210,000 | 1,338,950 | ||||||
Inland Valley Development Agency Successor Agency Tax Allocation, |
||||||||
Refunding, Series A, 5.25%, 9/01/37 |
7,500,000 | 8,282,925 | ||||||
Refunding, Series A, 5.00%, 9/01/44 |
9,000,000 | 9,779,670 | ||||||
Irvine Special Tax Revenue, |
||||||||
CFD No. 2013-3, Great Park, Improvement Area No. 1, 5.00%, 9/01/39 |
1,000,000 | 1,086,600 | ||||||
CFD No. 2013-3, Great Park, Improvement Area No. 1, 5.00%, 9/01/44 |
1,500,000 | 1,616,265 | ||||||
CFD No. 2013-3, Great Park, Improvement Area No. 1, 5.00%, 9/01/49 |
2,750,000 | 2,953,665 | ||||||
CFD No. 2013-3, Great Park, Improvement Area No. 8, 5.00%, 9/01/43 |
2,500,000 | 2,804,150 | ||||||
CFD No. 2013-3, Great Park, Improvement Area No. 8, 5.00%, 9/01/48 |
3,250,000 | 3,616,795 | ||||||
CFD No. 2013-3, Great Park, Improvement Area No. 8, AGMC Insured, 5.00%, 9/01/51 |
1,250,000 | 1,465,300 | ||||||
Irvine USD Special Tax, |
||||||||
CFD No. 06-1, Portola Springs, 6.70%, 9/01/35 |
2,565,000 | 2,590,214 | ||||||
CFD No. 09-1, Refunding, Series A, 5.00%, 9/01/45 |
2,000,000 | 2,268,460 | ||||||
CFD No. 09-1, Refunding, Series A, 5.00%, 9/01/49 |
2,000,000 | 2,256,860 | ||||||
CFD No. 09-1, Series A, 5.00%, 9/01/42 |
700,000 | 798,952 | ||||||
CFD No. 09-1, Series B, 5.00%, 9/01/42 |
1,000,000 | 1,141,360 | ||||||
CFD No. 09-1, Series B, 5.00%, 9/01/51 |
2,500,000 | 2,815,075 | ||||||
CFD No. 09-1, Series C, 5.00%, 9/01/47 |
1,000,000 | 1,132,130 | ||||||
CFD No. 09-1, Series D, 5.00%, 9/01/49 |
1,000,000 | 1,128,430 | ||||||
Jurupa PFA Special Tax Revenue, |
||||||||
Refunding, Series A, 5.00%, 9/01/42 |
2,220,000 | 2,551,224 | ||||||
Refunding, Series A, 5.00%, 9/01/43 |
4,000,000 | 4,736,360 | ||||||
sub. lien, Series B, 5.00%, 9/01/40 |
4,000,000 | 4,369,200 | ||||||
Kaweah Delta Health Care District Revenue, Series B, 5.00%, 6/01/40 |
3,250,000 | 3,637,562 | ||||||
La Verne COP, Brethren Hillcrest Homes, 5.00%, 5/15/36 |
1,430,000 | 1,429,914 | ||||||
La Verne Mobile Home Park Revenue, Copacabana Mobilehome Park, Refunding, 5.00%, 6/15/49 |
1,765,000 | 2,018,578 | ||||||
Lake Elsinore PFA Local Agency Revenue, |
||||||||
AD No. 93-1, Refunding, Series B, 5.125%, 9/02/30 |
4,980,000 | 5,320,433 | ||||||
Canyon Hills Improvement Area Development, Series A, 5.75%, 9/01/44 |
3,240,000 | 3,483,421 | ||||||
CFD No. 98-1, Series C, 5.25%, 9/01/33 |
8,000,000 | 8,575,520 | ||||||
Lake Tahoe USD, GO, Election of 2008, Convertible Capital Appreciation, zero cpn. to 8/01/25, 5.30% thereafter, 8/01/40 |
1,140,000 | 1,172,821 |
30 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Lammersville Joint USD Special Tax, |
||||||||
CFD No. 2014-1, Improvement Area No. 1, Mountain House School Facilities, 5.00%, 9/01/43 |
$ | 775,000 | $ | 852,089 | ||||
CFD No. 2014-1, Improvement Area No. 1, Mountain House School Facilities, 5.00%, 9/01/47 |
4,000,000 | 4,375,560 | ||||||
CFD No. 2014-1, Improvement Area No. 1, Mountain House School Facilities, 5.00%, 9/01/48 |
2,500,000 | 2,737,325 | ||||||
Las Virgenes USD, GO, Election of 2006, Convertible Capital Appreciation, Series C, zero cpn. to 8/01/26, 6.75% thereafter, 8/01/33 |
8,050,000 | 9,420,593 | ||||||
Lathrop Financing Authority Revenue, |
||||||||
Mossdale Village, Refunding, Series A, 6.00%, 9/02/28 |
1,010,000 | 1,092,850 | ||||||
Mossdale Village, Refunding, Series A, 6.00%, 9/02/29 |
1,070,000 | 1,154,423 | ||||||
Mossdale Village, Refunding, Series A, 6.00%, 9/02/30 |
1,075,000 | 1,155,743 | ||||||
Mossdale Village, Refunding, Series A, 5.50%, 9/02/35 |
3,670,000 | 3,822,158 | ||||||
LeeLakePFAR, |
||||||||
Special Tax, junior lien, Refunding, Series B, 5.25%, 9/01/32 |
1,155,000 | 1,239,061 | ||||||
Special Tax, junior lien, Refunding, Series B, 5.375%, 9/01/35 |
805,000 | 859,040 | ||||||
Lemon Grove CDA Successor Agency Tax Allocation, Lemon Grove Redevelopment Project Area, Refunding, AGMC Insured, 4.00%, 8/01/34 |
1,000,000 | 1,194,100 | ||||||
Lemon Grove School District GO, Capital Appreciation, Election of 2008, Series B, AGMC Insured, zero cpn. to 8/01/28, 6.10% thereafter, 8/01/45 |
6,500,000 | 7,123,870 | ||||||
Long Beach Bond Finance Authority Natural Gas Purchase Revenue, Series A, 5.00%, 11/15/29 |
4,630,000 | 5,829,679 | ||||||
Long Beach Marina Revenue, |
||||||||
Los Angeles County, Alamitos Bay Marina Project, 5.00%, 5/15/34 |
1,300,000 | 1,339,559 | ||||||
Los Angeles County, Alamitos Bay Marina Project, 5.00%, 5/15/40 |
3,500,000 | 3,558,380 | ||||||
Los Angeles County, Alamitos Bay Marina Project, 5.00%, 5/15/45 |
2,500,000 | 2,522,175 | ||||||
Los Alamitos USD, |
||||||||
COP, Capital Appreciation, Capital Projects, zero cpn. to 7/31/24, 5.95% thereafter, 8/01/34 |
1,500,000 | 1,689,735 | ||||||
COP, Capital Appreciation, Capital Projects, zero cpn. to 7/31/24, 5.95% thereafter, 8/01/42 |
4,500,000 | 4,921,425 | ||||||
Los Angeles Department of Airports Revenue, |
||||||||
Los Angeles International Airport, Subordinate, Refunding, Series F, 5.00%, 5/15/39 |
4,330,000 | 5,119,922 | ||||||
Los Angeles International Airport, Subordinate, Series D, 4.00%, 5/15/44 |
5,525,000 | 5,882,744 | ||||||
Mendocino-Lake Community College District GO, |
||||||||
Capital Appreciation, Election of 2006, Series B, AGMC Insured, zero cpn. to 8/01/21, 6.55% thereafter, 8/01/36 |
5,150,000 | 7,088,769 | ||||||
Capital Appreciation, Election of 2006, Series B, AGMC Insured, zero cpn. to 8/01/26, 6.85% thereafter, 8/01/40 |
7,500,000 | 9,266,925 | ||||||
Menifee USD Special Tax, |
||||||||
CFD No. 2011-1, Improvement Area No. 3, 5.00%, 9/01/43 |
1,000,000 | 1,103,560 | ||||||
CFD No. 2011-1, Improvement Area No. 3, 5.00%, 9/01/48 |
1,500,000 | 1,647,735 | ||||||
CFD No. 2011-1, Improvement Area No. 4, 5.00%, 9/01/48 |
2,900,000 | 3,155,954 | ||||||
Merced UHSD, GO, Capital Appreciation, Election of 2008, Series C, Pre-Refunded, zero cpn., 8/01/41 |
10,000,000 | 2,480,500 | ||||||
Middle Fork Project Finance Authority Revenue, |
||||||||
Refunding, 5.00%, 4/01/34 |
1,100,000 | 1,208,328 | ||||||
Refunding, 5.00%, 4/01/35 |
1,150,000 | 1,258,319 | ||||||
Moreland School District GO, Election of 2010, Series B, 5.00%, 8/01/41 |
4,045,000 | 4,798,341 | ||||||
Moreno Valley USD, |
||||||||
CFD No. 2015-2 Special Tax, 5.00%, 9/01/44 |
870,000 | 962,681 | ||||||
CFD No. 2015-3 Special Tax, 4.125%, 9/01/48 |
1,160,000 | 1,210,077 | ||||||
M-S-R Energy Authority Gas Revenue, Series B, 6.50%, 11/01/39 |
32,300,000 | 48,441,602 |
franklintempleton.com | Annual Report | 31 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Murrieta CFD No. 2005-5 Special Tax, Golden City, Improvement Area B, 5.00%, 9/01/48 |
$ | 3,740,000 | $ | 4,125,519 | ||||
North Natomas CFD Special Tax, No. 4, Refunding, Series E, 5.25%, 9/01/33 |
3,000,000 | 3,328,890 | ||||||
Oak Park USD, GO, Capital Appreciation, Series A, zero cpn. to 8/01/21, 7.10% thereafter, 8/01/38 |
6,600,000 | 9,297,750 | ||||||
Oakdale PFAR, Refunding, 5.00%, 9/01/35 |
1,270,000 | 1,395,578 | ||||||
Oakland USD Alameda County GO, Election of 2012, Pre-Refunded, 6.625%, 8/01/38 |
5,000,000 | 5,371,400 | ||||||
Oakley PFAR, |
||||||||
Contra Costa County, Refunding, 5.30%, 9/02/34 |
995,000 | 1,089,744 | ||||||
Contra Costa County, Refunding, BAM Insured, 5.00%, 9/02/36 |
1,500,000 | 1,748,220 | ||||||
Ontario CFD No. 28 Special Tax, |
||||||||
New Haven Facilities, Area A, 5.00%, 9/01/42 |
1,000,000 | 1,092,560 | ||||||
New Haven Facilities, Area A, 5.00%, 9/01/47 |
500,000 | 545,405 | ||||||
Ontario CFD No. 31 Special Tax, Amberly Lane, Carriage House, 5.00%, 9/01/47 |
1,100,000 | 1,219,603 | ||||||
Orange County CFD No. 2015-1 Special Tax, |
||||||||
Village of Esencia, Series A, 5.00%, 8/15/34 |
1,495,000 | 1,655,010 | ||||||
Village of Esencia, Series A, 5.25%, 8/15/45 |
4,880,000 | 5,348,480 | ||||||
Orange County CFD No. 2017-1 Special Tax, |
||||||||
Village of Esencia, Improvement Area No. 1, Series A, 5.00%, 8/15/42 |
6,230,000 | 7,024,886 | ||||||
Village of Esencia, Improvement Area No. 1, Series A, 5.00%, 8/15/47 |
10,000,000 | 11,174,900 | ||||||
Oro Grande Elementary School District COP, |
||||||||
5.875%, 9/15/37 |
14,000,000 | 14,193,340 | ||||||
6.125%, 9/15/40 |
1,500,000 | 1,521,300 | ||||||
Oroville Revenue, |
||||||||
Oroville Hospital, 5.25%, 4/01/49 |
4,000,000 | 4,196,600 | ||||||
Oroville Hospital, 5.25%, 4/01/54 |
3,500,000 | 3,657,185 | ||||||
Palomar Health COP, |
||||||||
Palomar Health and Arch Health Partners Inc., 4.00%, 11/01/38 |
5,000,000 | 5,047,150 | ||||||
Palomar Health and Arch Health Partners Inc., 4.00%, 11/01/47 |
6,000,000 | 5,918,220 | ||||||
Palomar Health Revenue, |
||||||||
Refunding, 5.00%, 11/01/36 |
6,250,000 | 7,045,750 | ||||||
Refunding, 5.00%, 11/01/42 |
5,000,000 | 5,578,200 | ||||||
Paramount USD, GO, Los Angeles County, Capital Appreciation, Election of 2006, BAM Insured, zero cpn., 8/01/51 |
25,000,000 | 3,353,250 | ||||||
Paso Robles Joint USD, GO, Capital Appreciation, Election of 2006, Series A, zero cpn., 9/01/45 |
15,000,000 | 6,863,400 | ||||||
Perris CFD No. 2001-2 Special Tax, Villages of Avalon, Refunding, Series A, 5.25%, 9/01/32 |
4,500,000 | 4,847,805 | ||||||
Perris Joint Powers Authority Local Agency Revenue, |
||||||||
CFD No. 2001-1, Improvement Area Nos. 6 and 7, Refunding, Series E, 4.25%, 9/01/38 |
4,170,000 | 4,316,325 | ||||||
CFD No. 2014-1, Improvement Area No. 2, Avelina, Series A, 4.00%, 9/01/48 |
2,530,000 | 2,608,152 | ||||||
May Farms, Improvement Area Nos. 1, 2 and 3, Refunding, Series A, 5.375%, 9/01/33 |
1,965,000 | 2,121,512 | ||||||
Willowbrook, Refunding, Series B, 5.25%, 9/01/33 |
3,780,000 | 4,034,961 | ||||||
Pico Rivera Water Authority Revenue, Refunding, Series A, 6.25%, 12/01/32 |
4,895,000 | 4,944,293 | ||||||
Pittsburg USD, |
||||||||
GO, Capital Appreciation, Election of 2010, Series C, zero cpn., Pre-Refunded, 8/01/47 |
9,000,000 | 2,093,130 | ||||||
GO, Capital Appreciation, Election of 2010, Series C, zero cpn., Pre-Refunded, 8/01/52 |
15,000,000 | 2,512,650 | ||||||
Porterville PFA Sewer Revenue, Series A, Pre-Refunded, 5.625%, 10/01/36 |
5,000,000 | 5,366,500 | ||||||
Poway RDA Successor Agency Tax Allocation, Paguay Redevelopment Project, Refunding, Series A, 5.00%, 12/15/30 |
3,500,000 | 4,618,215 | ||||||
Poway USD Special Tax, CFD No. 15, Del Sur East, Improvement Area C, 5.00%, 9/01/46 |
2,000,000 | 2,206,980 |
32 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Rancho Cordova CFD No. 2005-1 Special Tax, |
||||||||
Sunridge North Douglas, 5.00%, 9/01/40 |
$ | 1,200,000 | $ | 1,305,900 | ||||
Sunridge North Douglas, 5.00%, 9/01/45 |
1,250,000 | 1,347,175 | ||||||
Rancho Cordova CFD No. 2018-1 Special Tax, Grantline 208, 5.00%, 9/01/44 |
415,000 | 449,374 | ||||||
Redondo Beach USD, GO, Election of 2008, Capital Appreciation, Series E, zero cpn. to 8/01/22, 6.20% thereafter, 8/01/31 |
2,750,000 | 3,592,077 | ||||||
Richland School District GO, Capital Appreciation, Election of 2008, Refunding, Series C, AGMC Insured, zero cpn., 8/01/49 |
22,000,000 | 8,729,380 | ||||||
Rio Elementary School District CFD No. 1 Special Tax, Pre-Refunded, 5.50%, 9/01/39 |
6,915,000 | 8,063,789 | ||||||
Rio Hondo Community College District GO, Capital Appreciation, Election of 2004, Series C, zero cpn. to 8/01/24, 6.85% thereafter, 8/01/42 |
13,000,000 | 16,905,720 | ||||||
Rio Vista CFD No. 2018-1 Special Tax, |
||||||||
Liberty Community, Refunding, 5.00%, 9/01/33 |
1,625,000 | 1,842,051 | ||||||
Liberty Community, Refunding, 5.00%, 9/01/38 |
1,000,000 | 1,117,590 | ||||||
Liberty Community, Refunding, 5.00%, 9/01/48 |
1,190,000 | 1,313,891 | ||||||
Riverbank USD, |
||||||||
GO, Election of 2005, Series B, Assured Guaranty, zero cpn., 8/01/38 |
6,690,000 | 4,159,842 | ||||||
GO, Election of 2005, Series B, Assured Guaranty, zero cpn., 8/01/43 |
8,750,000 | 4,558,225 | ||||||
Riverside County RDA Tax Allocation, |
||||||||
Desert Communities Redevelopment Project Area, second lien, Series D, Pre-Refunded, 7.00%, 12/01/31 |
1,425,000 | 1,565,933 | ||||||
Desert Communities Redevelopment Project Area, second lien, Series D, Pre-Refunded, 7.25%, 12/01/37 |
2,505,000 | 2,762,088 | ||||||
Housing, Series A, Pre-Refunded, 7.125%, 10/01/42 |
1,750,000 | 1,906,748 | ||||||
Jurupa Valley Redevelopment Project Area, Series B, 6.75%, 10/01/30 |
1,200,000 | 1,302,192 | ||||||
Riverside County Special Tax, CFD No. 03-1, Newport Road, Refunding, 5.00%, 9/01/30 |
1,500,000 | 1,663,515 | ||||||
Riverside County Transportation Commission Toll Revenue, |
||||||||
Capital Appreciation, senior lien, Series B, zero cpn., 6/01/43 |
7,500,000 | 3,080,175 | ||||||
senior lien, Series A, 5.75%, 6/01/44 |
5,000,000 | 5,355,700 | ||||||
Riverside PFA Local Measure Sales Tax Revenue, Payment Rehabilitation Project, AGMC Insured, 5.00%, 6/01/33 |
4,280,000 | 4,810,634 | ||||||
RNR School Financing Authority Special Tax, CFD No. 92-1, Series A, BAM Insured, 5.00%, 9/01/41 |
3,000,000 | 3,549,300 | ||||||
Rocklin Special Tax, CFD No. 10, Whitney Ranch, 5.00%, 9/01/40 |
2,000,000 | 2,179,540 | ||||||
The Romoland School District Special Tax, |
||||||||
CFD No. 2004-1, Heritage Lake, Improvement Area No. 3, Refunding, 5.00%, 9/01/36 |
1,500,000 | 1,597,920 | ||||||
CFD No. 2004-1, Heritage Lake, Improvement Area Nos. 1 and 2, Refunding, 5.00%, 9/01/35 |
4,690,000 | 5,170,537 | ||||||
CFD No. 2004-1, Heritage Lake, Improvement Area Nos. 1 and 2, Refunding, 5.00%, 9/01/38 |
3,000,000 | 3,286,770 | ||||||
CFD No. 2006-1, Brendle Mills, Refunding, 5.00%, 9/01/44 |
1,120,000 | 1,244,858 | ||||||
CFD No. 91-1, Refunding, 5.00%, 9/01/41 |
1,265,000 | 1,412,094 | ||||||
Roseville Special Tax, |
||||||||
Fiddyment Ranch CFD No. 5, Public Facilities, Refunding, 5.00%, 9/01/32 |
1,265,000 | 1,440,620 | ||||||
Fiddyment Ranch CFD No. 5, Public Facilities, Refunding, 5.00%, 9/01/47 |
6,500,000 | 7,167,095 | ||||||
HP Campus Oaks CFD No. 1, Public Facilities, 5.00%, 9/01/36 |
2,300,000 | 2,539,729 | ||||||
HP Campus Oaks CFD No. 1, Public Facilities, 5.50%, 9/01/46 |
7,550,000 | 8,398,922 | ||||||
SVSP Westpark-Federico CFD No. 1, Public Facilities, 5.00%, 9/01/39 |
440,000 | 467,377 | ||||||
Villages at Sierra Vista CFD No. 1, Public Facilities, 5.00%, 9/01/36 |
685,000 | 742,595 | ||||||
Villages at Sierra Vista CFD No. 1, Public Facilities, 5.00%, 9/01/44 |
3,230,000 | 3,444,052 |
franklintempleton.com | Annual Report | 33 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Roseville Special Tax, (continued) |
||||||||
Westbrook CFD No. 1, Public Facilities, 5.00%, 9/01/29 |
$ | 500,000 | $ | 558,780 | ||||
Westbrook CFD No. 1, Public Facilities, 5.00%, 9/01/34 |
1,100,000 | 1,200,914 | ||||||
Westbrook CFD No. 1, Public Facilities, 5.00%, 9/01/39 |
1,885,000 | 2,034,914 | ||||||
Westbrook CFD No. 1, Public Facilities, 5.00%, 9/01/44 |
1,650,000 | 1,767,018 | ||||||
Westbrook CFD No. 1, Public Facilities, 5.00%, 9/01/49 |
3,800,000 | 4,183,268 | ||||||
Westpark CFD No. 1, Public Facilities, Refunding, 5.00%, 9/01/32 |
1,120,000 | 1,257,771 | ||||||
Westpark CFD No. 1, Public Facilities, Refunding, 5.00%, 9/01/33 |
1,000,000 | 1,116,940 | ||||||
Westpark CFD No. 1, Public Facilities, Refunding, 5.00%, 9/01/37 |
1,250,000 | 1,381,100 | ||||||
Westpark-Federico Community Facilities District No.1, 5.00%, 9/01/44 |
500,000 | 529,195 | ||||||
Westpark-Federico Community Facilities District No.1, 5.00%, 9/01/49 |
575,000 | 606,608 | ||||||
Rowland USD, |
||||||||
GO, Capital Appreciation, Election of 2006, Series B, zero cpn., 8/01/34 |
5,000,000 | 3,514,500 | ||||||
GO, Capital Appreciation, Election of 2006, Series B, zero cpn., 8/01/39 |
15,000,000 | 8,920,800 | ||||||
GO, Capital Appreciation, Election of 2006, Series B, zero cpn., 8/01/42 |
10,750,000 | 6,203,395 | ||||||
Sacramento Area Flood Control Agency Special Assessment, Natomas Basin Local Assessment, Refunding, BAM Insured, 5.00%, 10/01/44 |
2,000,000 | 2,325,340 | ||||||
Sacramento Special Tax, |
||||||||
Natomas Central CFD No. 2, 5.00%, 9/01/46 |
1,815,000 | 2,006,083 | ||||||
Natomas Meadows, CFD No. 2007-01, Improvement Area No. 2, 5.00%, 9/01/44 |
500,000 | 555,580 | ||||||
Natomas Meadows, CFD No. 2007-01, Improvement Area No. 2, 5.00%, 9/01/49 |
1,000,000 | 1,104,800 | ||||||
Natomas Meadows CFD No. 1, Improvement Area No. 1, 5.00%, 9/01/32 |
300,000 | 334,572 | ||||||
Natomas Meadows CFD No. 1, Improvement Area No. 1, 5.00%, 9/01/37 |
710,000 | 784,245 | ||||||
Natomas Meadows CFD No. 1, Improvement Area No. 1, 5.00%, 9/01/47 |
1,900,000 | 2,070,962 | ||||||
San Bernardino Community College District GO, |
||||||||
Capital Appreciation, Election of 2008, Series A, zero cpn., 8/01/44 |
12,495,000 | 6,417,432 | ||||||
Election of 2008, Series D, Pre-Refunded, 5.00%, 8/01/45 |
2,755,000 | 3,402,039 | ||||||
Election of 2008, Series D, Pre-Refunded, 5.00%, 8/01/48 |
3,760,000 | 4,643,074 | ||||||
San Bernardino County Special Tax, |
||||||||
CFD No. 2006-1, Improvement Area No. 1, Lytle Creek North, 5.00%, 9/01/40 |
1,000,000 | 1,085,740 | ||||||
CFD No. 2006-1, Improvement Area No. 2, Lytle Creek North, Refunding, 5.00%, 9/01/45 |
1,000,000 | 1,073,760 | ||||||
San Buenaventura Revenue, |
||||||||
Community Memorial Health System, 8.00%, 12/01/31 |
10,000,000 | 10,363,300 | ||||||
Community Memorial Health System, 7.50%, 12/01/41 |
5,000,000 | 5,086,800 | ||||||
San Clemente Special Tax, |
||||||||
CFD No. 2006-1, 5.00%, 9/01/40 |
1,780,000 | 1,947,000 | ||||||
CFD No. 2006-1, 5.00%, 9/01/46 |
2,475,000 | 2,678,470 | ||||||
San Diego Tobacco Settlement Revenue, Funding Corp., Subordinate, Refunding, Series C, 4.00%, 6/01/32 |
900,000 | 867,348 | ||||||
San Diego USD, |
||||||||
GO, Capital Appreciation, Election of 2008, Series A, Pre-Refunded, 6.00%, 7/01/33 |
10,000,000 | 12,314,600 | ||||||
GO, Capital Appreciation, Election of 2008, Series C, zero cpn. to 7/01/30, 6.625% thereafter, 7/01/47 |
26,025,000 | 28,321,186 | ||||||
GO, Dedicated Unlimited Ad Valorem Property Tax, Capital Appreciation, Election of 2008, Series E, zero cpn. to 7/01/32, 5.25% thereafter, 7/01/42 |
6,940,000 | 6,367,450 | ||||||
GO, Dedicated Unlimited Ad Valorem Property Tax, Capital Appreciation, Election of 2008, Series E, zero cpn. to 7/01/32, 5.375% thereafter, 7/01/47 |
13,500,000 | 12,636,675 |
34 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
San Francisco Calif City and County Airports Community International Airport Revenue, |
||||||||
Refunding, Series A, 5.00%, 5/01/37 |
$ | 5,535,000 | $ | 6,576,300 | ||||
Refunding, Series A, 5.00%, 5/01/44 |
35,000,000 | 40,853,050 | ||||||
San Francisco City and County Airport Commission International Airport Revenue, |
||||||||
Refunding, Second Series, Series A, 5.00%, 5/01/49 |
10,000,000 | 11,606,700 | ||||||
Refunding, Second Series, Series D, 5.00%, 5/01/48 |
10,000,000 | 11,459,100 | ||||||
San Francisco City and County RDA Successor Agency CFD No. 6 Special Tax, Mission Bay South Public Improvements, Capital Appreciation, Refunding, Series C, zero cpn., 8/01/43 |
10,000,000 | 2,753,800 | ||||||
San Francisco City and County RDA Successor Agency Tax Allocation, |
||||||||
Mission Bay South Redevelopment Project, Capital Appreciation, Subordinate, Series D, zero cpn., 8/01/23 |
2,000,000 | 1,772,700 | ||||||
Mission Bay South Redevelopment Project, Capital Appreciation, Subordinate, Series D, zero cpn., 8/01/26 |
3,000,000 | 2,288,340 | ||||||
Mission Bay South Redevelopment Project, Capital Appreciation, Subordinate, Series D, zero cpn., 8/01/31 |
6,000,000 | 3,550,320 | ||||||
Mission Bay South Redevelopment Project, Capital Appreciation, Subordinate, Series D, zero cpn., 8/01/43 |
16,500,000 | 5,302,110 | ||||||
Mission Bay South Redevelopment Project, Series A, 5.00%, 8/01/43 |
2,500,000 | 2,732,700 | ||||||
San Francisco City and County Redevelopment Financing Authority Tax Allocation Revenue, |
||||||||
Mission Bay North Redevelopment Project, Series C, Pre-Refunded, 6.75%, 8/01/41 |
1,000,000 | 1,042,880 | ||||||
Mission Bay South Redevelopment Project, Series D, Pre-Refunded, 7.00%, 8/01/33 |
1,000,000 | 1,043,220 | ||||||
Mission Bay South Redevelopment Project, Series D, Pre-Refunded, 7.00%, 8/01/41 |
1,500,000 | 1,564,830 | ||||||
San Francisco Redevelopment Projects, Series B, Pre-Refunded, 6.625%, 8/01/41 |
2,500,000 | 2,605,125 | ||||||
San Joaquin Hills Transportation Corridor Agency Toll Road Revenue, |
||||||||
Capital Appreciation, junior lien, ETM, zero cpn., 1/01/28 |
19,150,000 | 17,970,934 | ||||||
Capital Appreciation, Refunding, Series A, NATL Insured, zero cpn., 1/15/26 |
19,475,000 | 16,492,598 | ||||||
Capital Appreciation, Refunding, Series A, NATL Insured, zero cpn., 1/15/32 |
50,225,000 | 33,752,707 | ||||||
junior lien, Refunding, Series B, 5.25%, 1/15/44 |
35,000,000 | 37,343,950 | ||||||
junior lien, Refunding, Series B, 5.25%, 1/15/49 |
75,000,000 | 79,793,250 | ||||||
San Jose Airport Revenue, |
||||||||
Refunding, Series A, 5.00%, 3/01/36 |
2,250,000 | 2,589,412 | ||||||
Refunding, Series A, 5.00%, 3/01/37 |
2,500,000 | 2,868,750 | ||||||
Refunding, Series A, BAM Insured, 4.00%, 3/01/42 |
5,000,000 | 5,323,900 | ||||||
Refunding, Series B, 5.00%, 3/01/42 |
2,550,000 | 3,013,896 | ||||||
San Mateo Special Tax, |
||||||||
CFD No. 2008-1, Bay Meadows, 5.875%, 9/01/32 |
1,500,000 | 1,600,920 | ||||||
CFD No. 2008-1, Bay Meadows, 5.375%, 9/01/38 |
2,500,000 | 2,628,775 | ||||||
CFD No. 2008-1, Bay Meadows, 6.00%, 9/01/42 |
5,000,000 | 5,292,200 | ||||||
CFD No. 2008-1, Bay Meadows, 5.50%, 9/01/44 |
3,300,000 | 3,469,026 | ||||||
San Rafael Elementary School District GO, Marin County, Election of 2015, Series C, 5.00%, 8/01/43 |
1,565,000 | 1,900,786 | ||||||
Santa Barbara Elementary School District GO, Capital Appreciation, Election of 2010, Series A, zero cpn. to 8/01/23, 7.00% thereafter, 8/01/36 |
8,000,000 | 11,075,600 | ||||||
Santa Margarita Water District Special Tax, |
||||||||
CFD No. 2013-1, Village of Sendero, 5.625%, 9/01/36 |
2,875,000 | 3,102,240 | ||||||
CFD No. 2013-1, Village of Sendero, 5.625%, 9/01/43 |
9,600,000 | 10,288,320 | ||||||
Santa Paula Utility Authority Wastewater Enterprise Revenue, Series A, 5.00%, 2/01/40 |
5,105,000 | 5,842,315 |
franklintempleton.com | Annual Report | 35 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Santee Community Development Commission Tax Allocation, |
||||||||
Santee Community Redevelopment Project, Series A, Pre-Refunded, 7.00%, 8/01/31 |
$ | 1,800,000 | $ | 1,880,280 | ||||
Santee Community Redevelopment Project, Series A, Pre-Refunded, 7.00%, 8/01/41 |
2,820,000 | 2,945,772 | ||||||
Saugus Castaic School Facilities Financing Authority Special Tax, |
||||||||
CFD No. 2006-1C, 5.875%, 9/01/33 |
1,370,000 | 1,506,507 | ||||||
CFD No. 2006-1C, 6.00%, 9/01/43 |
3,395,000 | 3,682,760 | ||||||
Saugus USD Special Tax, Senior CFD No. 2006-1, 4.25%, 9/01/44 |
2,500,000 | 2,593,325 | ||||||
Saugus/Hart School Facilities Financing Authority Special Tax, |
||||||||
CFD No. 2006-1 Saugus USD, Refunding, 5.00%, 9/01/41 |
1,250,000 | 1,374,125 | ||||||
CFD No. 2006-1 Saugus USD, Refunding, 5.00%, 9/01/46 |
1,250,000 | 1,365,788 | ||||||
Simi Valley AD No. 98-1 Special Assessment, Madera/Royal Public Improvements, Limited Obligation Improvements, 7.30%, 9/02/24 |
1,010,000 | 1,017,605 | ||||||
Siskiyou UHSD, GO, Capital Appreciation, Election of 2008, Series B, AGMC Insured, zero cpn., 8/01/49 |
15,015,000 | 5,465,460 | ||||||
Sonoma CDA Tax Allocation, Redevelopment Project, 7.00%, 12/01/30 |
2,115,000 | 2,274,682 | ||||||
St. Helena USD, GO, Capital Appreciation, zero cpn. to 8/01/25, 6.45% thereafter, 6/01/36 |
10,000,000 | 12,773,300 | ||||||
Sulphur Springs USD Special Tax Revenue, |
||||||||
CFD No. 2006-1, 5.00%, 9/01/43 |
1,410,000 | 1,544,119 | ||||||
CFD No. 2006-1, 5.00%, 9/01/47 |
1,820,000 | 1,985,274 | ||||||
Susanville School District GO, Capital Appreciation, Election of 2008, AGMC Insured, zero cpn., 8/01/49 |
17,505,000 | 6,848,481 | ||||||
Temecula RDA Tax Allocation Revenue, Housing, Redevelopment Project No. 1, Series A, Pre-Refunded, 7.00%, 8/01/39 |
2,100,000 | 2,255,106 | ||||||
Tobacco Securitization Authority Northern California Tobacco Settlement Revenue, |
||||||||
Asset-Backed, Series A-1, 5.375%, 6/01/38 |
5,000,000 | 5,000,250 | ||||||
Asset-Backed, Series A-1, 5.50%, 6/01/45 |
800,000 | 800,032 | ||||||
Sacramento County Tobacco Securitization Corp., Asset Backed, Series A-2, 5.40%, 6/01/27 |
1,250,000 | 1,250,088 | ||||||
Tobacco Securitization Authority Southern California Tobacco Settlement Asset-Backed Revenue, |
||||||||
San Diego County Tobacco Asset Securitization Corp., First Subordinate, Capital Appreciation, Series B, zero cpn., 6/01/46 |
10,000,000 | 1,868,100 | ||||||
San Diego County Tobacco Asset Securitization Corp., Second Subordinate Capital Appreciation, Refunding, Series C, zero cpn., 6/01/46 |
25,000,000 | 4,020,750 | ||||||
San Diego County Tobacco Assset Securitization Corp., Class 2, Refunding, Series B-1, 5.00%, 6/01/48 |
11,750,000 | 12,357,710 | ||||||
Torrance USD, GO, Capital Appreciation, Election of 2008, Measure Z, Series B-1, zero cpn., 8/01/34 |
5,640,000 | 3,502,158 | ||||||
Tracy CFD No. 2016-1 Special Tax, |
||||||||
Improvement Area No. 1, Tracy Hills, 5.00%, 9/01/33 |
1,610,000 | 1,794,715 | ||||||
Improvement Area No. 1, Tracy Hills, 5.00%, 9/01/38 |
2,385,000 | 2,616,393 | ||||||
Improvement Area No. 1, Tracy Hills, 5.00%, 9/01/43 |
5,750,000 | 6,237,600 | ||||||
Improvement Area No. 1, Tracy Hills, 5.00%, 9/01/44 |
2,600,000 | 2,805,894 | ||||||
Improvement Area No. 1, Tracy Hills, 5.00%, 9/01/48 |
6,240,000 | 6,741,259 | ||||||
Tracy CFD No. 2016-2 Special Tax, Improvement Area No. 1, 5.00%, 9/01/44 |
1,500,000 | 1,624,245 | ||||||
Truckee-Donner PUD Special Tax, |
||||||||
CFD No. 04-1, 5.20%, 9/01/25 |
2,975,000 | 2,682,855 | ||||||
CFD No. 04-1, 5.75%, 9/01/29 |
2,945,000 | 2,563,652 | ||||||
CFD No. 04-1, 5.25%, 9/01/30 |
4,990,000 | 4,128,327 | ||||||
CFD No. 04-1, 5.80%, 9/01/35 |
4,475,000 | 3,611,862 | ||||||
Turlock PFA Tax Allocation Revenue, Pre-Refunded, 7.50%, 9/01/39 |
3,750,000 | 3,952,237 | ||||||
Tustin CFD No. 06-1 Special Tax, Legacy/Columbus Villages, Series A, 5.00%, 9/01/37 |
1,000,000 | 1,157,670 |
36 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
Tustin CFD No. 07-1 Special Tax, Tustin Legacy/Retail Center, Refunding, Series A, 5.00%, 9/01/37 |
$ | 2,330,000 | $ | 2,566,006 | ||||
Tustin CFD No. 14-1 Special Tax, |
||||||||
Legacy/Standard Pacific, Series A, 5.00%, 9/01/40 |
750,000 | 819,983 | ||||||
Legacy/Standard Pacific, Series A, 5.00%, 9/01/45 |
1,000,000 | 1,076,240 | ||||||
University of California Revenue, Refunding, Series AO, 5.00%, 5/15/40 |
5,000,000 | 5,919,550 | ||||||
Upland CFD No. 2015-1 Special Tax, Sycamore Hills, Series A, 4.00%, 9/01/49 |
550,000 | 569,195 | ||||||
Val Verde USD Special Tax Revenue, |
||||||||
Refunding, 5.00%, 9/01/29 |
3,200,000 | 3,621,408 | ||||||
Refunding, 5.00%, 9/01/37 |
2,000,000 | 2,184,560 | ||||||
Vallejo RDA Tax Allocation, Housing Set-Aside, Refunding, Series A, 7.00%, 10/01/31 |
2,850,000 | 2,859,490 | ||||||
Vernon Electric System Revenue, |
||||||||
Series A, 5.00%, 8/01/35 |
1,440,000 | 1,713,802 | ||||||
Series A, 5.00%, 8/01/37 |
800,000 | 944,344 | ||||||
Series A, 5.50%, 8/01/41 |
7,500,000 | 7,890,150 | ||||||
Victor Elementary School District CFD No. 2005-1 Special Tax, 5.00%, 9/01/46 |
1,385,000 | 1,613,885 | ||||||
Victor Elementary School District GO, Election of 2008, Refunding, Series B, 5.00%, 8/01/42 |
5,455,000 | 6,378,804 | ||||||
Victor Valley Community College District GO, Capital Appreciation, Election of 2002, Series C, zero cpn., 6/01/49 |
11,940,000 | 4,946,145 | ||||||
Washington Township Health Care District Revenue, |
||||||||
Refunding, Series B, 4.00%, 7/01/35 |
2,000,000 | 2,161,020 | ||||||
Refunding, Series B, 4.00%, 7/01/36 |
1,900,000 | 2,045,426 | ||||||
Series A, 5.50%, 7/01/38 |
2,890,000 | 2,899,710 | ||||||
West Hollywood Community Development Commission Tax Allocation, |
||||||||
East Side Redevelopment Project, Series A, 7.25%, 9/01/31 |
1,000,000 | 1,083,360 | ||||||
East Side Redevelopment Project, Series A, 7.50%, 9/01/42 |
5,000,000 | 5,408,350 | ||||||
Woodland Finance Authority Water Revenue, |
||||||||
6.00%, 3/01/36 |
1,000,000 | 1,041,350 | ||||||
6.00%, 3/01/41 |
1,500,000 | 1,559,820 | ||||||
Woodland Special Tax, |
||||||||
CFD No. 2004-1, Capital Projects, Spring Lake, 5.00%, 9/01/44 |
1,575,000 | 1,743,588 | ||||||
CFD No. 2004-1, Capital Projects, Spring Lake, 5.00%, 9/01/48 |
1,750,000 | 1,929,497 | ||||||
Yorba Linda RDA Tax Allocation, Redevelopment Project, sub. lien, Series A, Pre-Refunded, 6.50%, 9/01/32 |
2,750,000 | 2,962,795 | ||||||
Yucaipa Special Tax, |
||||||||
CFD No. 98-1 Chapman Heights, Refunding, 5.00%, 9/01/26 |
1,000,000 | 1,046,640 | ||||||
CFD No. 98-1 Chapman Heights, Refunding, 5.375%, 9/01/30 |
1,800,000 | 1,888,092 | ||||||
|
|
|||||||
2,621,760,079 | ||||||||
|
|
|||||||
U.S. Territories 2.5% |
||||||||
Guam 0.8% |
||||||||
Guam Government Waterworks Authority Water and Wastewater System Revenue, |
||||||||
5.00%, 7/01/36 |
3,550,000 | 3,813,055 | ||||||
5.00%, 1/01/46 |
5,250,000 | 5,614,298 | ||||||
Refunding, 5.00%, 7/01/36 |
3,455,000 | 3,750,264 | ||||||
Refunding, 5.00%, 7/01/37 |
3,000,000 | 3,249,270 | ||||||
Refunding, Series A, 5.00%, 7/01/35 |
1,000,000 | 1,053,790 |
franklintempleton.com | Annual Report | 37 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
U.S. Territories (continued) |
||||||||
Guam (continued) |
||||||||
Guam Power Authority Revenue, Refunding, Series A, 5.00%, 10/01/40 |
$ | 4,750,000 | $ | 5,053,905 | ||||
|
|
|||||||
22,534,582 | ||||||||
|
|
|||||||
Northern Mariana Islands 0.1% |
||||||||
Northern Mariana Islands Commonwealth Ports Authority Seaport Revenue, Senior Series A, 6.60%, 3/15/28 |
4,890,000 | 4,702,028 | ||||||
|
|
|||||||
Puerto Rico 1.6% |
||||||||
a Puerto Rico Electric Power Authority Power Revenue, |
||||||||
Series A-4-RSA-1, zero cpn., 7/01/19 |
1,601,766 | 1,105,219 | ||||||
Series A-RSA-1, 5.00%, 7/01/29 |
10,000,000 | 6,175,000 | ||||||
Series A-RSA-1, 7.00%, 7/01/33 |
25,000,000 | 15,718,750 | ||||||
Series A-RSA-1, 6.75%, 7/01/36 |
11,735,000 | 7,363,713 | ||||||
Series A-RSA-1, 5.00%, 7/01/42 |
6,000,000 | 3,705,000 | ||||||
Series A-RSA-1, 7.00%, 7/01/43 |
5,000,000 | 3,143,750 | ||||||
Series B-4-RSA-1, zero cpn., 7/01/19 |
1,601,765 | 1,105,218 | ||||||
Series E-1-RSA-1, zero cpn., 1/01/21 |
1,768,493 | 1,242,366 | ||||||
Series E-2-RSA-1, zero cpn., 7/01/21 |
1,768,493 | 1,242,366 | ||||||
Series E-3-RSA-1, zero cpn., 1/01/22 |
600,000 | 421,500 | ||||||
Series E-4-RSA-1, zero cpn., 7/01/22 |
600,000 | 421,500 | ||||||
Puerto Rico Industrial Tourist Educational Medical and Environmental Control Facilities Financing Authority Revenue, Cogeneration Facility, AES Puerto Rico Project, 6.625%, 6/01/26 |
4,500,000 | 4,657,500 | ||||||
|
|
|||||||
46,301,882 | ||||||||
|
|
|||||||
Total U.S. Territories |
73,538,492 | |||||||
|
|
|||||||
Total Municipal Bonds (Cost $2,474,485,728) |
2,695,298,571 | |||||||
|
|
|||||||
Total Municipal Bonds before Short Term Investments (Cost $2,474,485,728) |
2,695,298,571 | |||||||
|
|
|||||||
Short Term Investments 5.4% |
||||||||
Municipal Bonds 5.4% |
||||||||
California 5.4% |
||||||||
b California State GO, |
||||||||
Floating, Series A-2, LOC Bank of Montreal, Daily VRDN and Put, 0.02%, 5/01/33 |
11,975,000 | 11,975,000 | ||||||
Kindergarten, Refunding, Series B3, LOC Citibank, Daily VRDN and Put, 0.04%, 5/01/34 |
3,000,000 | 3,000,000 | ||||||
Kindergarten - University Public Education Facilities, Refunding, Series A1, LOC Citibank, Daily VRDN and Put, 0.03%, 5/01/34 |
30,090,000 | 30,090,000 | ||||||
Series A-3, LOC Bank of Montreal, Daily VRDN and Put, 0.02%, 5/01/33 |
14,200,000 | 14,200,000 | ||||||
b California Statewide CDA Revenue, Rady Childrens Hospital-San Diego, Series B, LOC Wells Fargo Bank, Daily VRDN and Put, 0.04%, 8/15/47 |
2,400,000 | 2,400,000 | ||||||
b Irvine 1915 Act Special Assessment, Limited Obligation Improvement, AD No. 94-13, LOC State Street Bank & Trust Co., Daily VRDN and Put, 0.03%, 9/02/22 |
1,000,000 | 1,000,000 | ||||||
b Irvine Ranch Water District GO, ID, Consolidated, Series B, LOC Bank of America, Daily VRDN and Put, 0.04%, 10/01/41 |
11,965,000 | 11,965,000 |
38 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin California High Yield Municipal Fund (continued)
Principal Amount |
Value | |||||||
Short Term Investments (continued) |
||||||||
Municipal Bonds (continued) |
||||||||
California (continued) |
||||||||
b Santa Clara Valley Transportation Authority Sales Tax Revenue, |
||||||||
2000 Measure A, Refunding, Series C, SPA TD Bank National Association, Daily VRDN and Put, 0.03%, 4/01/36 |
$ | 12,380,000 | $ | 12,380,000 | ||||
2000 Measure A, Refunding, Series D, SPA TD Bank National Association, Daily VRDN and Put, 0.02%, 4/01/36 |
13,300,000 | 13,300,000 | ||||||
b Southern California Public Power Authority Revenue, Magnolia Power Project, Refunding, Series A, LOC US Bank National Association, 0.04%, Daily VRDN and Put, 7/01/36 |
3,600,000 | 3,600,000 | ||||||
b University of California Revenue, |
||||||||
General, Refunding, Series AL-1, Daily VRDN and Put, 0.03%, 5/15/48 |
14,565,000 | 14,565,000 | ||||||
General, Refunding, Series AL-2, Daily VRDN and Put, 0.03%, 5/15/48 |
8,450,000 | 8,450,000 | ||||||
General, Refunding, Series AL-3, Daily VRDN and Put, 0.03%, 5/15/48 |
29,800,000 | 29,800,000 | ||||||
|
|
|||||||
Total Short Term Investments (Cost $156,725,000) |
156,725,000 | |||||||
|
|
|||||||
Total Investments (Cost $2,631,210,728) 98.6% |
2,852,023,571 | |||||||
Other Assets, less Liabilities 1.4% |
39,769,440 | |||||||
|
|
|||||||
Net Assets 100.0% |
$ | 2,891,793,011 | ||||||
|
|
See Abbreviations on page 61.
aSee Note 7 regarding defaulted securities.
bVariable rate demand notes (VRDNs) are obligations which contain a floating or variable interest rate adjustment formula and an unconditional right of demand to receive payment of the principal balance plus accrued interest at specified dates. Unless otherwise noted, the coupon rate is determined based on factors including supply and demand, underlying credit, tax treatment, and current short term rates. The coupon rate shown represents the rate at period end.
franklintempleton.com | The accompanying notes are an integral part of these financial statements. | Annual Report | 39 |
FRANKLIN MUNICIPAL SECURITIES TRUST
Financial Highlights
Franklin Tennessee Municipal Bond Fund
Year Ended May 31, | ||||||||
2020 | 2019a | |||||||
Class A |
||||||||
Per share operating performance |
||||||||
(for a share outstanding throughout the year) |
||||||||
Net asset value, beginning of year |
$10.97 | $10.74 | ||||||
Income from investment operationsb: |
||||||||
Net investment incomec |
0.29 | 0.23 | ||||||
Net realized and unrealized gains (losses) |
(0.01 | ) | 0.25 | |||||
Total from investment operations |
0.28 | 0.48 | ||||||
Less distributions from: |
||||||||
Net investment income |
(0.29 | ) | (0.25 | ) | ||||
Net asset value, end of year |
$10.96 | $10.97 | ||||||
Total returnd |
2.54% | 4.53% | ||||||
Ratios to average net assetse |
||||||||
Expensesf |
0.93% | 0.93% | ||||||
Net investment income |
2.63% | 2.94% | ||||||
Supplemental data |
||||||||
Net assets, end of year (000s) |
$8,350 | $4,971 | ||||||
Portfolio turnover rate |
11.83% | 3.46% |
aFor the period September 10, 2018 (effective date) to May 31, 2019.
bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
cBased on average daily shares outstanding.
dTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable, and is not annualized for periods less than one year.
eRatios are annualized for periods less than one year.
fBenefit of expense reduction rounds to less than 0.01%.
40 |
Annual Report | The accompanying notes are an integral part of these financial statements. | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL HIGHLIGHTS
Franklin Tennessee Municipal Bond Fund (continued)
Year Ended May 31, | ||||||||||||||||||||
2020 | 2019 | 2018 | 2017 | 2016 | ||||||||||||||||
Class A1 |
||||||||||||||||||||
Per share operating performance |
||||||||||||||||||||
(for a share outstanding throughout the year) |
||||||||||||||||||||
Net asset value, beginning of year |
$10.96 | $10.79 | $11.11 | $11.44 | $11.38 | |||||||||||||||
Income from investment operationsa: |
||||||||||||||||||||
Net investment incomeb |
0.31 | 0.33 | 0.34 | 0.37 | 0.40 | |||||||||||||||
Net realized and unrealized gains (losses) |
(0.02 | ) | 0.19 | (0.32 | ) | (0.32 | ) | 0.06 | ||||||||||||
Total from investment operations |
0.29 | 0.52 | 0.02 | 0.05 | 0.46 | |||||||||||||||
Less distributions from: |
||||||||||||||||||||
Net investment income |
(0.30 | ) | (0.35 | ) | (0.34 | ) | (0.38 | ) | (0.40 | ) | ||||||||||
Net asset value, end of year |
$10.95 | $10.96 | $10.79 | $11.11 | $11.44 | |||||||||||||||
Total returnc |
2.69% | 4.92% | 0.23% | 0.40% | 4.12% | |||||||||||||||
Ratios to average net assets |
||||||||||||||||||||
Expenses |
0.78% | d | 0.78% | d | 0.77% | 0.72% | 0.72% | |||||||||||||
Net investment income |
2.78% | 3.09% | 3.08% | 3.27% | 3.55% | |||||||||||||||
Supplemental data |
||||||||||||||||||||
Net assets, end of year (000s) |
$164,616 | $190,548 | $226,189 | $267,442 | $307,294 | |||||||||||||||
Portfolio turnover rate |
11.83% | 3.46% | 9.19% | 18.95% | 4.50% |
aThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
bBased on average daily shares outstanding.
cTotal return does not reflect sales commissions or contingent deferred sales charges, if applicable.
dBenefit of expense reduction rounds to less than 0.01%.
franklintempleton.com | The accompanying notes are an integral part of these financial statements. | Annual Report | 41 |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL HIGHLIGHTS
Franklin Tennessee Municipal Bond Fund (continued)
Year Ended May 31, | ||||||||||||
2020 | 2019 | 2018a | ||||||||||
Class R6 |
||||||||||||
Per share operating performance |
||||||||||||
(for a share outstanding throughout the year) |
||||||||||||
Net asset value, beginning of year |
$10.97 | $10.79 | $11.06 | |||||||||
Income from investment operationsb: |
||||||||||||
Net investment incomec |
0.32 | 0.35 | 0.29 | |||||||||
Net realized and unrealized gains (losses) |
(0.01 | ) | 0.19 | (0.26 | ) | |||||||
Total from investment operations |
0.31 | 0.54 | 0.03 | |||||||||
Less distributions from: |
||||||||||||
Net investment income |
(0.32 | ) | (0.36 | ) | (0.30 | ) | ||||||
Net asset value, end of year |
$10.96 | $10.97 | $10.79 | |||||||||
Total returnd |
2.83% | 5.15% | 0.25% | |||||||||
Ratios to average net assetse |
||||||||||||
Expenses before waiver and payments by affiliates |
0.66% | 0.66% | 0.66% | |||||||||
Expenses net of waiver and payments by affiliates |
0.65% | f | 0.65% | f | 0.64% | |||||||
Net investment income |
2.91% | 3.22% | 3.21% | |||||||||
Supplemental data |
||||||||||||
Net assets, end of year (000s) |
$2,803 | $3,253 | $3,547 | |||||||||
Portfolio turnover rate |
11.83% | 3.46% | 9.19% |
aFor the period August 1, 2017 (effective date) to May 31, 2018.
bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
cBased on average daily shares outstanding.
dTotal return is not annualized for periods less than one year.
eRatios are annualized for periods less than one year.
fBenefit of expense reduction rounds to less than 0.01%.
42 |
Annual Report | The accompanying notes are an integral part of these financial statements. | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL HIGHLIGHTS
Franklin Tennessee Municipal Bond Fund (continued)
Year Ended May 31, | ||||||||||||||||
2020 | 2019 | 2018 | 2017a | |||||||||||||
Advisor Class |
||||||||||||||||
Per share operating performance |
||||||||||||||||
(for a share outstanding throughout the year) |
||||||||||||||||
Net asset value, beginning of year |
$10.97 | $10.79 | $11.12 | $11.50 | ||||||||||||
Income from investment operationsb: |
||||||||||||||||
Net investment incomec |
0.32 | 0.34 | 0.35 | 0.27 | ||||||||||||
Net realized and unrealized gains (losses) |
(0.02 | ) | 0.20 | (0.32 | ) | (0.38 | ) | |||||||||
Total from investment operations |
0.30 | 0.54 | 0.03 | (0.11 | ) | |||||||||||
Less distributions from: |
||||||||||||||||
Net investment income |
(0.31 | ) | (0.36 | ) | (0.36 | ) | (0.27 | ) | ||||||||
Net asset value, end of year |
$10.96 | $10.97 | $10.79 | $11.12 | ||||||||||||
Total returnd |
2.79% | 5.12% | 0.24% | (0.91)% | ||||||||||||
Ratios to average net assetse |
||||||||||||||||
Expenses |
0.68% | f | 0.68% | f | 0.67% | 0.62% | ||||||||||
Net investment income |
2.88% | 3.19% | 3.18% | 3.37% | ||||||||||||
Supplemental data |
||||||||||||||||
Net assets, end of year (000s) |
$24,675 | $23,252 | $23,573 | $23,916 | ||||||||||||
Portfolio turnover rate |
11.83% | 3.46% | 9.19% | 18.95% |
aFor the period September 15, 2016 (effective date) to May 31, 2017.
bThe amount shown for a share outstanding throughout the period may not correlate with the Statement of Operations for the period due to the timing of sales and repurchases of the Funds shares in relation to income earned and/or fluctuating fair value of the investments of the Fund.
cBased on average daily shares outstanding.
dTotal return is not annualized for periods less than one year.
eRatios are annualized for periods less than one year.
fBenefit of expense reduction rounds to less than 0.01%.
franklintempleton.com | The accompanying notes are an integral part of these financial statements. | Annual Report | 43 |
FRANKLIN MUNICIPAL SECURITIES TRUST
Statement of Investments, May 31, 2020
Franklin Tennessee Municipal Bond Fund
Principal Amount |
Value | |||||||
Municipal Bonds 98.3% |
||||||||
Tennessee 96.8% |
||||||||
Chattanooga Electric System Revenue, The Electric Power Board of Chattanooga, Refunding, Series C, 5.00%, 9/01/40 |
$ | 2,750,000 | $ | 3,266,972 | ||||
Chattanooga Health Educational and Housing Facility Board Revenue, Student Housing, CDFI Phase I LLC, University of Tennessee at Chattanooga Project, Refunding, 5.00%, 10/01/35 |
1,000,000 | 1,004,110 | ||||||
Clarksville Electric System Revenue, |
||||||||
Series A, Pre-Refunded, 5.00%, 9/01/34 |
2,000,000 | 2,022,040 | ||||||
Series A, Pre-Refunded, 5.00%, 9/01/35 |
3,185,000 | 3,220,099 | ||||||
Clarksville Water Sewer and Gas Revenue, Pre-Refunded, 5.00%, 2/01/38 |
3,000,000 | 3,376,380 | ||||||
Coffee County GO, Rural School, Refunding, 4.00%, 6/01/44 |
2,760,000 | 3,138,451 | ||||||
Columbia Waterworks System Revenue, 5.00%, 12/01/32 |
3,000,000 | 3,185,940 | ||||||
Gallatin Water and Sewer Revenue, Refunding and Improvement, 5.00%, 1/01/32 |
1,500,000 | 1,755,570 | ||||||
Germantown GO, |
||||||||
4.00%, 8/01/43 |
2,330,000 | 2,652,099 | ||||||
4.00%, 8/01/45 |
2,525,000 | 2,864,208 | ||||||
The Hallsdale-Powell Utility District Water and Sewer Revenue, Knox County, Improvement, Refunding, 4.00%, 4/01/39 |
1,380,000 | 1,619,665 | ||||||
Harpeth Valley Utilities District of Davidson and Williamson Counties Revenue, |
||||||||
Utilities, 5.00%, 9/01/44 |
4,400,000 | 5,066,292 | ||||||
Utilities, 4.00%, 9/01/50 |
500,000 | 575,010 | ||||||
Jackson Hospital Revenue, |
||||||||
Jackson-Madison County General Hospital, Refunding, 5.00%, 4/01/36 |
4,000,000 | 4,395,520 | ||||||
Jackson-Madison County General Hospital, Refunding, Series A, 5.00%, 4/01/41 |
2,370,000 | 2,689,879 | ||||||
Johnson City Health and Educational Facilities Board Hospital Revenue, Johnson City Medical Center Hospital, Improvement, Series C, NATL Insured, Pre-Refunded, 5.125%, 7/01/25 |
55,000 | 55,897 | ||||||
Kingsport IDB, MFHR, Model City Apartments Project, GNMA Secured, 5.50%, 7/20/39 |
2,995,000 | 2,997,606 | ||||||
Knox County Health Educational and Housing Facility Board Hospital Revenue, Covenant Health, Refunding, Series A, 5.00%, 1/01/42 |
5,000,000 | 5,574,300 | ||||||
Knox County Health Educational and Housing Facility Board Revenue, |
||||||||
University Health System Inc., Refunding, 5.00%, 4/01/36 |
2,250,000 | 2,510,303 | ||||||
University Health System Inc., Refunding, 5.00%, 9/01/47 |
3,000,000 | 3,234,660 | ||||||
Knox-Chapman Utility District of Knox County Water and Sewer Revenue, |
||||||||
Pre-Refunded, 5.25%, 1/01/36 |
1,500,000 | 1,544,370 | ||||||
Refunding and Improvement, 4.00%, 1/01/40 |
4,000,000 | 4,209,560 | ||||||
Knoxville Wastewater System Revenue, Refunding, Series A, 4.00%, 4/01/42 |
5,000,000 | 5,261,500 | ||||||
Lawrenceburg PBA, GO, Electric System, Refunding, AMBAC Insured, 5.00%, 7/01/22 |
1,835,000 | 1,921,172 | ||||||
Loudon Water and Sewer Revenue, |
||||||||
Exempt Facility, Series A, 4.00%, 3/01/28 |
1,000,000 | 1,048,050 | ||||||
Exempt Facility, Series A, 5.00%, 3/01/32 |
1,300,000 | 1,397,968 | ||||||
Manchester GO, Refunding, AGMC Insured, 5.00%, 6/01/38 |
2,045,000 | 2,049,356 | ||||||
Maury County GO, Public Improvement, Refunding, 4.00%, 4/01/34 |
1,775,000 | 1,991,089 | ||||||
Memphis Electric System Revenue, 5.00%, 12/01/34 |
1,000,000 | 1,175,730 | ||||||
Memphis Gas System Revenue, 4.00%, 12/01/36 |
1,000,000 | 1,162,030 | ||||||
Memphis GO, General Improvement, Refunding, 5.00%, 5/01/36 |
4,135,000 | 4,293,949 | ||||||
Memphis-Shelby County Airport Authority Airport Revenue, |
||||||||
Refunding, Series B, 5.75%, 7/01/25 |
2,500,000 | 2,509,150 | ||||||
Refunding, Series D, 5.00%, 7/01/25 |
3,000,000 | 3,125,550 | ||||||
Series A, AGMC Insured, 5.00%, 7/01/35 |
5,000,000 | 5,015,750 |
44 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin Tennessee Municipal Bond Fund (continued)
Principal Amount |
Value | |||||||
Municipal Bonds (continued) |
||||||||
Tennessee (continued) |
||||||||
Memphis-Shelby County Airport Authority Airport Revenue, (continued) |
||||||||
Series A, AGMC Insured, 5.00%, 7/01/39 |
$ | 2,565,000 | $ | 2,572,977 | ||||
Metropolitan Government of Nashville and Davidson County Electric System Revenue, |
||||||||
Series A, 5.00%, 5/15/36 |
3,500,000 | 3,629,675 | ||||||
Series A, 5.00%, 5/15/39 |
4,000,000 | 4,528,240 | ||||||
Metropolitan Government of Nashville and Davidson County Health and Educational Facilities Board Revenue, Vanderbilt University Medical Center, Series A, 5.00%, 7/01/40 |
5,000,000 | 5,639,750 | ||||||
Metropolitan Government of Nashville and Davidson County Sports Authority Revenue, |
||||||||
Public Improvement, Ballpark Project, Series A, 5.00%, 8/01/38 |
3,000,000 | 3,330,390 | ||||||
Public Improvement, Ballpark Project, Series A, 5.00%, 8/01/43 |
2,075,000 | 2,303,520 | ||||||
Metropolitan Government of Nashville and Davidson County Water and Sewer Revenue, Green Bonds, Subordinate, Series A, 5.00%, 7/01/46 |
6,855,000 | 8,287,009 | ||||||
Metropolitan Nashville Airport Authority Revenue, |
||||||||
Improvement, Series A, 5.00%, 7/01/45 |
4,000,000 | 4,455,640 | ||||||
Subordinate, Series B, 4.00%, 7/01/49 |
5,000,000 | 5,337,550 | ||||||
Pigeon Forge IDB Revenue, Public Facility, 5.00%, 6/01/34 |
1,250,000 | 1,294,375 | ||||||
Shelby County Health Educational and Housing Facility Board Revenue, |
||||||||
Educational Facilities, Rhodes College, 5.00%, 8/01/45 |
1,700,000 | 1,915,254 | ||||||
Educational Facilities, Rhodes College, Pre-Refunded, 5.50%, 8/01/40 |
5,000,000 | 5,301,850 | ||||||
Methodist Le Bonheur Healthcare, Series A, 5.00%, 5/01/36 |
4,000,000 | 4,666,720 | ||||||
Rhodes College, Refunding, 4.00%, 8/01/40 |
3,000,000 | 3,384,060 | ||||||
South Blount County Utility District Waterworks Revenue, Refunding, 3.00%, 12/01/39 |
2,015,000 | 2,169,107 | ||||||
Tennessee HDA Residential Finance Program Revenue, |
||||||||
Issue 1C, 4.00%, 7/01/43 |
1,245,000 | 1,311,682 | ||||||
Issue 2, 3.85%, 7/01/42 |
1,980,000 | 2,187,108 | ||||||
Issue 3, 3.65%, 7/01/47 |
990,000 | 1,055,736 | ||||||
Issue 4, Refunding, 4.00%, 7/01/43 |
4,500,000 | 4,989,105 | ||||||
Tennessee HDA Revenue, Homeownership Program, Series 2C, 3.80%, 7/01/43 |
1,105,000 | 1,135,984 | ||||||
Tennessee State School Bond Authority Revenue, |
||||||||
Higher Educational Facilities Second Program, Refunding, Series B, 5.00%, 11/01/40 |
10,000,000 | 11,885,100 | ||||||
Higher Educational Facilities Second Program, Refunding, Series B, 5.00%, 11/01/45 |
5,000,000 | 5,902,450 | ||||||
West Knox Utility District Knox County Water and Sewer Revenue, Refunding and Improvement, 5.00%, 6/01/41 |
1,000,000 | 1,130,640 | ||||||
West Wilson Utility District of Wilson County Water Revenue, |
||||||||
Pre-Refunded, 5.00%, 6/01/33 |
3,000,000 | 3,140,280 | ||||||
Refunding and Improvement, 5.00%, 6/01/40 |
1,545,000 | 1,829,635 | ||||||
Wilson County GO, School, Series A, 4.00%, 4/01/42 |
5,000,000 | 5,537,000 | ||||||
Wilson County Tenth Special School District Limited Obligation, 5.00%, 4/01/44 |
2,500,000 | 3,139,250 | ||||||
|
|
|||||||
193,970,312 | ||||||||
|
|
|||||||
U.S. Territories 1.5% |
||||||||
Puerto Rico 1.5% |
||||||||
a Puerto Rico Electric Power Authority Power Revenue, Series XX-RSA-1, 5.25%, 7/01/40 |
5,000,000 | 3,100,000 | ||||||
|
|
|||||||
Total Municipal Bonds before Short Term Investments (Cost $188,767,744) |
197,070,312 | |||||||
|
|
franklintempleton.com | Annual Report | 45 |
FRANKLIN MUNICIPAL SECURITIES TRUST
STATEMENT OF INVESTMENTS
Franklin Tennessee Municipal Bond Fund (continued)
Principal Amount |
Value | |||||||
Short Term Investments (Cost $200,000) 0.1% |
||||||||
Municipal Bonds 0.1% |
||||||||
Tennessee 0.1% |
||||||||
b Shelby County Health Educational and Housing Facility Board Revenue, Methodist Le Bonheur Healthcare, Refunding, Series A, AGMC Insured, SPA US Bank National Association, Daily VRDN and Put, 0.06%, 6/01/42 |
$ | 200,000 | $ | 200,000 | ||||
|
|
|||||||
Total Investments (Cost $188,967,744) 98.4% |
197,270,312 | |||||||
Other Assets, less Liabilities 1.6% |
3,173,860 | |||||||
|
|
|||||||
Net Assets 100.0% |
$ | 200,444,172 | ||||||
|
|
See Abbreviations on page 61.
aSee Note 7 regarding defaulted securities.
bVariable rate demand notes (VRDNs) are obligations which contain a floating or variable interest rate adjustment formula and an unconditional right of demand to receive payment of the principal balance plus accrued interest at specified dates. Unless otherwise noted, the coupon rate is determined based on factors including supply and demand, underlying credit, tax treatment, and current short term rates. The coupon rate shown represents the rate at period end.
46 |
Annual Report | The accompanying notes are an integral part of these financial statements. | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL STATEMENTS
Statements of Assets and Liabilities
May 31, 2020
Franklin High Yield |
Franklin Bond Fund |
|||||||
Assets: |
||||||||
Investments in securities: |
||||||||
Cost - Unaffiliated issuers |
$2,631,210,728 | $188,967,744 | ||||||
|
|
|||||||
Value - Unaffiliated issuers |
$2,852,023,571 | $197,270,312 | ||||||
Cash |
206,732 | 260,288 | ||||||
Receivables: |
||||||||
Investment securities sold |
6,002,754 | 507,838 | ||||||
Capital shares sold |
7,858,225 | 174,602 | ||||||
Interest |
32,459,336 | 2,488,181 | ||||||
Other assets |
3,005 | 198 | ||||||
|
|
|||||||
Total assets |
2,898,553,623 | 200,701,419 | ||||||
|
|
|||||||
Liabilities: |
||||||||
Payables: |
||||||||
Capital shares redeemed |
3,359,204 | 28,642 | ||||||
Management fees |
1,103,428 | 95,177 | ||||||
Distribution fees |
332,559 | 15,673 | ||||||
Transfer agent fees |
415,590 | 27,047 | ||||||
Professional fees |
68,717 | 44,415 | ||||||
Distributions to shareholders |
1,341,610 | 29,821 | ||||||
Accrued expenses and other liabilities |
139,504 | 16,472 | ||||||
|
|
|||||||
Total liabilities |
6,760,612 | 257,247 | ||||||
|
|
|||||||
Net assets, at value |
$2,891,793,011 | $200,444,172 | ||||||
|
|
|||||||
Net assets consist of: |
||||||||
Paid-in capital |
$2,783,389,017 | $207,163,189 | ||||||
Total distributable earnings (losses) |
108,403,994 | (6,719,017 | ) | |||||
|
|
|||||||
Net assets, at value |
$2,891,793,011 | $200,444,172 | ||||||
|
|
franklintempleton.com | The accompanying notes are an integral part of these financial statements. | Annual Report | 47 |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL STATEMENTS
Statements of Assets and Liabilities (continued)
May 31, 2020
Franklin High Yield Municipal Fund |
Franklin Bond Fund |
|||||||
Class A: |
||||||||
Net assets, at value |
$ | 425,756,928 | $ | 8,350,471 | ||||
|
|
| ||||||
Shares outstanding |
39,390,770 | 761,950 | ||||||
|
|
| ||||||
Net asset value per sharea |
$10.81 | $10.96 | ||||||
|
|
| ||||||
Maximum offering price per share (net asset value per share ÷ 96.25%) |
$11.23 | $11.39 | ||||||
|
|
| ||||||
Class A1: |
||||||||
Net assets, at value |
$ | 1,282,021,585 | $ | 164,615,923 | ||||
|
|
| ||||||
Shares outstanding |
118,844,057 | 15,029,307 | ||||||
|
|
| ||||||
Net asset value per sharea |
$10.79 | $10.95 | ||||||
|
|
| ||||||
Maximum offering price per share (net asset value per share ÷ 96.25%) |
$11.21 | $11.38 | ||||||
|
|
| ||||||
Class C: |
||||||||
Net assets, at value |
$ | 253,579,090 | ||||||
|
|
|
||||||
Shares outstanding |
23,325,460 | |||||||
|
|
|
||||||
Net asset value and maximum offering price per sharea |
$10.87 | |||||||
|
|
|
||||||
Class R6: |
||||||||
Net assets, at value |
$ | 26,741,017 | $ | 2,803,162 | ||||
|
|
| ||||||
Shares outstanding |
2,470,405 | 255,865 | ||||||
|
|
| ||||||
Net asset value and maximum offering price per share |
$10.82 | $10.96 | ||||||
|
|
| ||||||
Advisor Class: |
||||||||
Net assets, at value |
$ | 903,694,391 | $ | 24,674,616 | ||||
|
|
| ||||||
Shares outstanding |
83,557,955 | 2,251,081 | ||||||
|
|
| ||||||
Net asset value and maximum offering price per share |
$10.82 | $10.96 | ||||||
|
|
|
aRedemption price is equal to net asset value less contingent deferred sales charges, if applicable.
48 |
Annual Report | The accompanying notes are an integral part of these financial statements. | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL STATEMENTS
Statements of Operations
for the year ended May 31, 2020
Franklin High Yield |
Franklin Tennessee Municipal Bond Fund |
|||||||
Investment income: |
||||||||
Interest: |
||||||||
Unaffiliated issuers |
$ | 118,695,507 | $ | 7,667,095 | ||||
|
|
|||||||
Expenses: |
||||||||
Management fees (Note 3a) |
13,956,841 | 1,204,558 | ||||||
Distribution fees: (Note 3c) |
||||||||
Class A |
1,020,239 | 17,820 | ||||||
Class A1 |
1,374,900 | 181,479 | ||||||
Class C |
1,781,753 | | ||||||
Transfer agent fees: (Note 3e) |
||||||||
Class A |
268,369 | 4,452 | ||||||
Class A1 |
903,909 | 113,328 | ||||||
Class C |
180,225 | | ||||||
Class R6 |
11,184 | 1,424 | ||||||
Advisor Class |
637,472 | 15,337 | ||||||
Custodian fees (Note 4) |
21,818 | 1,513 | ||||||
Reports to shareholders |
73,988 | 13,585 | ||||||
Registration and filing fees |
99,654 | 12,080 | ||||||
Professional fees |
197,324 | 69,724 | ||||||
Trustees fees and expenses |
74,750 | 5,364 | ||||||
Other |
211,778 | 24,560 | ||||||
|
|
|||||||
Total expenses |
20,814,204 | 1,665,224 | ||||||
Expense reductions (Note 4) |
(15,956 | ) | (1,035 | ) | ||||
Expenses waived/paid by affiliates (Note 3f) |
(3,246 | ) | (464 | ) | ||||
|
|
|||||||
Net expenses |
20,795,002 | 1,663,725 | ||||||
|
|
|||||||
Net investment income |
97,900,505 | 6,003,370 | ||||||
|
|
|||||||
Realized and unrealized gains (losses): |
||||||||
Net realized gain (loss) from: |
||||||||
Investments: |
||||||||
Unaffiliated issuers |
(41,775,849 | ) | 465,088 | |||||
|
|
|||||||
Net change in unrealized appreciation (depreciation) on: |
||||||||
Investments: |
||||||||
Unaffiliated issuers |
(59,782,094 | ) | (704,713 | ) | ||||
|
|
|||||||
Net realized and unrealized gain (loss) |
(101,557,943 | ) | (239,625 | ) | ||||
|
|
|||||||
Net increase (decrease) in net assets resulting from operations |
$ | (3,657,438 | ) | $ | 5,763,745 | |||
|
|
franklintempleton.com | The accompanying notes are an integral part of these financial statements. | Annual Report | 49 |
FRANKLIN MUNICIPAL SECURITIES TRUST
FINANCIAL STATEMENTS
Statements of Changes in Net Assets
Franklin California High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund |
|||||||||||||||
Year Ended May 31, | Year Ended May 31, | |||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Increase (decrease) in net assets: |
||||||||||||||||
Operations: |
||||||||||||||||
Net investment income |
$ | 97,900,505 | $ | 92,823,527 | $ | 6,003,370 | $ | 7,252,910 | ||||||||
Net realized gain (loss) |
(41,775,849 | ) | 6,194,069 | 465,088 | (10,168 | ) | ||||||||||
Net change in unrealized appreciation (depreciation) |
(59,782,094 | ) | 89,825,327 | (704,713 | ) | 3,715,864 | ||||||||||
|
|
|||||||||||||||
Net increase (decrease) in net assets resulting from operations |
(3,657,438 | ) | 188,842,923 | 5,763,745 | 10,958,606 | |||||||||||
|
|
|||||||||||||||
Distributions to shareholders: |
||||||||||||||||
Class A |
(12,490,587 | ) | (3,188,725 | ) | (183,564 | ) | (63,310 | ) | ||||||||
Class A1 |
(44,347,479 | ) | (52,065,730 | ) | (4,998,244 | ) | (6,647,714 | ) | ||||||||
Class C |
(7,340,097 | ) | (9,134,274 | ) | | | ||||||||||
Class R6 |
(889,558 | ) | (670,331 | ) | (92,627 | ) | (114,742 | ) | ||||||||
Advisor Class |
(32,207,561 | ) | (30,399,177 | ) | (698,518 | ) | (785,947 | ) | ||||||||
|
|
|||||||||||||||
Total distributions to shareholders |
(97,275,282 | ) | (95,458,237 | ) | (5,972,953 | ) | (7,611,713 | ) | ||||||||
|
|
|||||||||||||||
Capital share transactions: (Note 2) |
||||||||||||||||
Class A |
201,861,524 | 235,411,225 | 3,392,035 | 4,860,314 | ||||||||||||
Class A1 |
(65,993,268 | ) | (38,267,367 | ) | (25,773,020 | ) | (38,480,111 | ) | ||||||||
Class C |
(10,484,112 | ) | (62,677,849 | ) | | | ||||||||||
Class R6 |
6,463,302 | 7,429,963 | (441,753 | ) | (340,291 | ) | ||||||||||
Advisor Class |
47,001,789 | 112,045,938 | 1,451,989 | (671,740 | ) | |||||||||||
|
|
|||||||||||||||
Total capital share transactions |
178,849,235 | 253,941,910 | (21,370,749 | ) | (34,631,828 | ) | ||||||||||
|
|
|||||||||||||||
Net increase (decrease) in net assets |
77,916,515 | 347,326,596 | (21,579,957 | ) | (31,284,935 | ) | ||||||||||
Net assets: |
||||||||||||||||
Beginning of year |
2,813,876,496 | 2,466,549,900 | 222,024,129 | 253,309,064 | ||||||||||||
|
|
|||||||||||||||
End of year |
$ | 2,891,793,011 | $ | 2,813,876,496 | $ | 200,444,172 | $ | 222,024,129 | ||||||||
|
|
50 |
Annual Report | The accompanying notes are an integral part of these financial statements. | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
Notes to Financial Statements
franklintempleton.com | Annual Report | 51 |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
52 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
2. Shares of Beneficial Interest
At May 31, 2020, there were an unlimited number of shares authorized (without par value). Transactions in the Funds shares were as follows:
Franklin California High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class A Shares: |
||||||||||||||||
Year ended May 31, 2020 |
||||||||||||||||
Shares solda |
31,096,565 | $ | 347,089,109 | 422,392 | $ | 4,640,650 | ||||||||||
Shares issued in reinvestment of distributions |
1,004,920 | 11,168,678 | 15,918 | 175,312 | ||||||||||||
Shares redeemed |
(14,706,484 | ) | (156,396,263 | ) | (129,472 | ) | (1,423,927 | ) | ||||||||
|
|
| ||||||||||||||
Net increase (decrease) |
17,395,001 | $ | 201,861,524 | 308,838 | $ | 3,392,035 | ||||||||||
|
|
| ||||||||||||||
Year ended May 31, 2019b |
||||||||||||||||
Shares solda |
29,417,854 | $ | 314,485,980 | 466,737 | $ | 5,006,589 | ||||||||||
Shares issued in reinvestment of distributions |
280,016 | 3,023,252 | 5,832 | 63,234 | ||||||||||||
Shares redeemed |
(7,702,101 | ) | (82,098,007 | ) | (19,457 | ) | (209,509 | ) | ||||||||
|
|
| ||||||||||||||
Net increase (decrease) |
21,995,769 | $ | 235,411,225 | 453,112 | $ | 4,860,314 | ||||||||||
|
|
| ||||||||||||||
Class A1 Shares: |
||||||||||||||||
Year ended May 31, 2020 |
||||||||||||||||
Shares sold |
9,480,324 | $ | 104,735,142 | 519,815 | $ | 5,705,758 | ||||||||||
Shares issued in reinvestment of distributions |
3,389,451 | 37,671,175 | 425,353 | 4,681,959 | ||||||||||||
Shares redeemed |
(19,138,207 | ) | (208,399,585 | ) | (3,296,729 | ) | (36,160,737 | ) | ||||||||
|
|
| ||||||||||||||
Net increase (decrease) |
(6,268,432 | ) | $ | (65,993,268 | ) | (2,351,561 | ) | $ | (25,773,020 | ) | ||||||
|
|
| ||||||||||||||
Year ended May 31, 2019 |
||||||||||||||||
Shares sold |
16,558,804 | $ | 176,930,518 | 540,106 | $ | 5,816,998 | ||||||||||
Shares issued in reinvestment of distributions |
4,123,926 | 44,141,197 | 575,127 | 6,190,781 | ||||||||||||
Shares redeemed |
(24,345,818 | ) | (259,339,082 | ) | (4,706,541 | ) | (50,487,890 | ) | ||||||||
|
|
| ||||||||||||||
Net increase (decrease) |
(3,663,088 | ) | $ | (38,267,367 | ) | (3,591,308 | ) | $ | (38,480,111 | ) | ||||||
|
|
| ||||||||||||||
Class C Shares: |
||||||||||||||||
Year ended May 31, 2020 |
||||||||||||||||
Shares sold |
5,632,486 | $ | 63,514,850 | |||||||||||||
Shares issued in reinvestment of distributions |
550,824 | 6,167,625 | ||||||||||||||
Shares redeemeda |
(7,232,118 | ) | (80,166,587 | ) | ||||||||||||
Net increase (decrease) |
(1,048,808 | ) | $ | (10,484,112 | ) | |||||||||||
Year ended May 31, 2019 |
||||||||||||||||
Shares sold |
4,690,276 | $ | 50,662,807 | |||||||||||||
Shares issued in reinvestment of distributions |
714,904 | 7,709,480 | ||||||||||||||
Shares redeemeda |
(11,360,194 | ) | (121,050,136 | ) | ||||||||||||
Net increase (decrease) |
(5,955,014 | ) | $ | (62,677,849 | ) |
franklintempleton.com | Annual Report | 53 |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
2. Shares of Beneficial Interest (continued)
Franklin California High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund | |||||||||||||||
Shares | Amount | Shares | Amount | |||||||||||||
Class R6 Shares: |
||||||||||||||||
Year ended May 31, 2020 |
||||||||||||||||
Shares sold |
1,431,024 | $ | 16,034,824 | 68,971 | $ | 755,785 | ||||||||||
Shares issued in reinvestment of distributions |
67,313 | 749,737 | 8,414 | 92,627 | ||||||||||||
Shares redeemed |
(935,907 | ) | (10,321,259 | ) | (118,152 | ) | (1,290,165 | ) | ||||||||
|
|
| ||||||||||||||
Net increase (decrease) |
562,430 | $ | 6,463,302 | (40,767 | ) | $ | (441,753 | ) | ||||||||
|
|
| ||||||||||||||
Year ended May 31, 2019 |
||||||||||||||||
Shares sold |
1,067,116 | $ | 11,383,693 | 63,398 | $ | 680,463 | ||||||||||
Shares issued in reinvestment of distributions |
55,815 | 599,865 | 10,657 | 114,741 | ||||||||||||
Shares redeemed |
(426,215 | ) | (4,553,595 | ) | (106,228 | ) | (1,135,495 | ) | ||||||||
|
|
| ||||||||||||||
Net increase (decrease) |
696,716 | $ | 7,429,963 | (32,173 | ) | $ | (340,291 | ) | ||||||||
|
|
| ||||||||||||||
Advisor Class Shares: |
||||||||||||||||
Year ended May 31, 2020 |
||||||||||||||||
Shares sold |
29,033,470 | $ | 323,384,128 | 495,722 | $ | 5,462,282 | ||||||||||
Shares issued in reinvestment of distributions |
2,198,640 | 24,498,557 | 56,097 | 617,946 | ||||||||||||
Shares redeemed |
(27,789,030 | ) | (300,880,896 | ) | (420,104 | ) | (4,628,239 | ) | ||||||||
|
|
| ||||||||||||||
Net increase (decrease) |
3,443,080 | $ | 47,001,789 | 131,715 | $ | 1,451,989 | ||||||||||
|
|
| ||||||||||||||
Year ended May 31, 2019 |
||||||||||||||||
Shares sold |
27,870,236 | $ | 298,680,447 | 683,998 | $ | 7,361,521 | ||||||||||
Shares issued in reinvestment of distributions |
2,061,371 | 22,137,099 | 65,070 | 700,827 | ||||||||||||
Shares redeemed |
(19,578,620 | ) | (208,771,608 | ) | (814,132 | ) | (8,734,088 | ) | ||||||||
|
|
| ||||||||||||||
Net increase (decrease) |
10,352,987 | $ | 112,045,938 | (65,064 | ) | $ | (671,740 | ) | ||||||||
|
|
|
aMay include a portion of Class C shares that were automatically converted to Class A.
bFor the period September 10, 2018 (effective date) to May 31, 2019.
3. Transactions with Affiliates
Franklin Resources, Inc. is the holding company for various subsidiaries that together are referred to as Franklin Templeton. Certain officers and trustees of the Trust are also officers and/or directors of the following subsidiaries:
Subsidiary | Affiliation | |||
Franklin Advisers, Inc. (Advisers) |
Investment manager | |||
Franklin Templeton Services, LLC (FT Services) |
Administrative manager | |||
Franklin Templeton Distributors, Inc. (Distributors) |
Principal underwriter | |||
Franklin Templeton Investor Services, LLC (Investor Services) |
Transfer agent |
54 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
a. Management Fees
The Funds pay an investment management fee to Advisers based on the average daily net assets of each of the Funds as follows:
Annualized Fee Rate | Net Assets | |
0.625% |
Up to and including $100 million | |
0.500% |
Over $100 million, up to and including $250 million | |
0.450% |
Over $250 million, up to and including $7.5 billion | |
0.440% |
Over $7.5 billion, up to and including $10 billion | |
0.430% |
Over $10 billion, up to and including $12.5 billion | |
0.420% |
Over $12.5 billion, up to and including $15 billion | |
0.400% |
Over $15 billion, up to and including $17.5 billion | |
0.380% |
Over $17.5 billion, up to and including $20 billion | |
0.360% |
In excess of $20 billion |
For the year ended May 31, 2020, each Funds gross effective investment management fee rate based on average daily net assets was as follows:
Franklin California High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund | |||
0.458% |
0.558 | % |
b. Administrative Fees
Under an agreement with Advisers, FT Services provides administrative services to the Funds. The fee is paid by Advisers based on each of the Funds average daily net assets, and is not an additional expense of the Funds.
c. Distribution Fees
The Board has adopted distribution plans for each share class, with the exception of Class R6 and Advisor Class shares, pursuant to Rule 12b-1 under the 1940 Act. Under the Funds Class A and A1 reimbursement distribution plans, the Funds reimburse Distributors for costs incurred in connection with the servicing, sale and distribution of each Funds shares up to the maximum annual plan rate. Under the Class A and A1 reimbursement distribution plans, costs exceeding the maximum for the current plan year cannot be reimbursed in subsequent periods. In addition, under the Funds Class C compensation distribution plans, Franklin California High Yield Municipal Fund pays Distributors for costs incurred in connection with the servicing, sale and distribution of each Funds shares up to the maximum annual plan rate. The plan year, for purposes of monitoring compliance with the maximum annual plan rates, is February 1 through January 31 for each Fund.
franklintempleton.com | Annual Report | 55 |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
2. Shares of Beneficial Interest (continued)
c. Distribution Fees (continued)
The maximum annual plan rates, based on the average daily net assets, for each class, are as follows:
Franklin California High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund |
|||||||
Reimbursement Plans: |
||||||||
Class A |
0.25% | 0.25% | ||||||
Class A1 |
0.15% | 0.15% | ||||||
Compensation Plans: |
||||||||
Class C |
0.65% | |
Distributors has agreed to limit the current rate to 0.10% per year for Class A1.
d. Sales Charges/Underwriting Agreements
Front-end sales charges and contingent deferred sales charges (CDSC) do not represent expenses of the Funds. These charges are deducted from the proceeds of sales of fund shares prior to investment or from redemption proceeds prior to remittance, as applicable. Distributors has advised the Funds of the following commission transactions related to the sales and redemptions of the Funds shares for the year:
Franklin California High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund |
|||||||||||||||
Sales charges retained net of commissions paid to unaffiliated brokers/dealers |
$ | 53,793 | $ | 6,164 | ||||||||||||
CDSC retained |
$ | 132,676 | $ | 38 |
e. Transfer Agent Fees
Each class of shares pays transfer agent fees to Investor Services for its performance of shareholder servicing obligations. The fees are based on an annualized asset based fee of 0.02% plus a transaction based fee. In addition, each class reimburses Investor Services for out of pocket expenses incurred and, except for Class R6, reimburses shareholder servicing fees paid to third parties. These fees are allocated daily based upon their relative proportion of such classes aggregate net assets. Class R6 pays Investor Services transfer agent fees specific to that class.
For the year ended May 31, 2020, the Funds paid transfer agent fees as noted in the Statements of Operations of which the following amounts were retained by Investor Services:
Franklin California High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund |
|||||||||||
Transfer agent fees |
$809,380 | $58,388 |
56 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
f. Waiver and Expense Reimbursements
Investor Services has contractually agreed in advance to waive or limit its fees so that the Class R6 transfer agent fees do not exceed 0.03% based on the average net assets of the class until September 30, 2020.
g. Interfund Transactions
Certain or all Funds engaged in purchases and sales of investments with funds or other accounts that have common investment managers (or affiliated investment managers), directors, trustees or officers. These purchases and sales for the year ended May 31, 2020, were as follows:
Franklin High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund |
|||||||
Purchases |
$ | 88,486,000 | $ | 7,315,000 | ||||
Sales |
$ | 211,171,000 | $ | 14,145,000 |
4. Expense Offset Arrangement
The Funds have entered into an arrangement with their custodian whereby credits realized as a result of uninvested cash balances are used to reduce a portion of the Funds custodian expenses. During the year ended May 31, 2020, the custodian fees were reduced as noted in the Statements of Operations.
5. Income Taxes
For tax purposes, capital losses may be carried over to offset future capital gains.
At May 31, 2020, the capital loss carryforwards were as follows:
Franklin High Yield |
Franklin Tennessee Municipal Bond Fund |
|||||||
Capital loss carryforwards not subject to expiration: |
||||||||
Short term |
$ | 83,223,344 | $ | 4,845,143 | ||||
Long term |
27,539,844 | 10,232,093 | ||||||
|
|
|||||||
Total capital loss carryforwards |
$ | 110,763,188 | $ | 15,077,236 | ||||
|
|
During the year ended May 31, 2020, the Franklin Tennessee Municipal Bond Fund utilized $37,583 of capital loss carryforwards.
The tax character of distributions paid during the years ended May 31, 2020 and 2019, was as follows:
Franklin California High Yield Municipal Fund |
Franklin Tennessee Municipal Bond Fund |
|||||||||||||||
2020 | 2019 | 2020 | 2019 | |||||||||||||
Distributions paid from tax exempt income |
$ | 97,275,282 | $ | 95,458,237 | $ | 5,972,953 | $ | 7,611,713 |
franklintempleton.com | Annual Report | 57 |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
5. Income Taxes (continued)
At May 31, 2020, the cost of investments, net unrealized appreciation (depreciation) and undistributed tax exempt income for income tax purposes were as follows:
Franklin High Yield |
Franklin Bond Fund |
|||||||
Cost of investments |
$ | 2,636,625,066 | $ | 189,133,379 | ||||
Unrealized appreciation |
$ | 280,741,180 | $ | 10,225,623 | ||||
Unrealized depreciation |
(65,342,675 | ) | (2,088,690 | ) | ||||
Net unrealized appreciation (depreciation) |
$ | 215,398,505 | $ | 8,136,933 | ||||
Distributable earnings: |
||||||||
Undistributed tax exempt income |
$ | 5,235,168 | $ | 251,112 |
Differences between income and/or capital gains as determined on a book basis and a tax basis are primarily due to differing treatments of wash sales and bond workout expenditures.
6. Investment Transactions
Purchases and sales of investments (excluding short term securities) for the year ended May 31, 2020, were as follows:
Franklin High Yield |
Franklin Tennessee Municipal Bond Fund |
|||||||
Purchases |
$805,349,692 | $25,116,856 | ||||||
Sales |
$657,485,130 | $46,112,136 |
7. Credit Risk and Defaulted Securities
At May 31, 2020, Franklin California High Yield Municipal Fund had 26.5% of its portfolio rated below investment grade as determined by Nationally Recognized Statistical Credit Ratings Organizations and/or internally, by investment management. These securities may be more sensitive to economic conditions causing greater price volatility and are potentially subject to a greater risk of loss due to default than higher rated securities.
Certain or all Funds held defaulted securities and/or other securities for which the income has been deemed uncollectible. At May 31, 2020, the aggregate value of these securities for Franklin California High Yield Municipal Fund and Franklin Tennessee Municipal Bond Fund was $41,644,382 and $3,100,000, representing 1.4% and 1.5%, respectively, of each Funds net assets. The Funds discontinue accruing income on securities for which income has been deemed uncollectible and provide an estimate for losses on interest receivable. The securities have been identified in the accompanying Statements of Investments.
58 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
8. Concentration of Risk
Certain or all Funds invest a large percentage of their total assets in obligations of issuers within their respective state and U.S. territories. Such concentration may subject the Funds to risks associated with industrial or regional matters, and economic, political or legal developments occurring within those states and U.S. territories. Investing in Puerto Rico securities may expose the Funds to heightened risks due to recent adverse economic and market changes, credit downgrades and ongoing restructuring discussions. In addition, investments in these securities are sensitive to interest rate changes and credit risk of the issuer and may subject the Funds to increased market volatility. The market for these investments may be limited, which may make them difficult to buy or sell.
9. Novel Coronavirus Pandemic
The global outbreak of the novel coronavirus disease, known as COVID-19, has caused adverse effects on many companies, sectors, nations, regions and the markets in general, and may continue for an unpredictable duration. The effects of this pandemic may materially impact the value and performance of the Funds, their ability to buy and sell fund investments at appropriate valuations and their ability to achieve their investment objectives.
10. Credit Facility
The Funds, together with other U.S. registered and foreign investment funds (collectively, Borrowers), managed by Franklin Templeton, are borrowers in a joint syndicated senior unsecured credit facility totaling $2 billion (Global Credit Facility) which matures on February 5, 2021. This Global Credit Facility provides a source of funds to the Borrowers for temporary and emergency purposes, including the ability to meet future unanticipated or unusually large redemption requests.
Under the terms of the Global Credit Facility, the Funds shall, in addition to interest charged on any borrowings made by the Funds and other costs incurred by the Funds, pay their share of fees and expenses incurred in connection with the implementation and maintenance of the Global Credit Facility, based upon their relative share of the aggregate net assets of all of the Borrowers, including an annual commitment fee of 0.15% based upon the unused portion of the Global Credit Facility. These fees are reflected in other expenses in the Statements of Operations. During the year ended May 31, 2020, the Funds did not use the Global Credit Facility.
11. Fair Value Measurements
The Funds follow a fair value hierarchy that distinguishes between market data obtained from independent sources (observable inputs) and the Funds own market assumptions (unobservable inputs). These inputs are used in determining the value of the Funds financial instruments and are summarized in the following fair value hierarchy:
| Level 1 quoted prices in active markets for identical financial instruments |
| Level 2 other significant observable inputs (including quoted prices for similar financial instruments, interest rates, prepayment speed, credit risk, etc.) |
| Level 3 significant unobservable inputs (including the Funds own assumptions in determining the fair value of financial instruments) |
The input levels are not necessarily an indication of the risk or liquidity associated with financial instruments at that level.
At May 31, 2020, all of the Funds investments in financial instruments carried at fair value were valued using Level 2 inputs.
franklintempleton.com | Annual Report | 59 |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
12. New Accounting Pronouncements
In March 2020, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2020-04, Reference Rate Reform (Topic 848) Facilitation of the Effects of Reference Rate Reform on Financial Reporting. The amendments in the ASU provides optional temporary financial reporting relief from the effect of certain types of contract modifications due to the planned discontinuation of the London Interbank Offered Rate (LIBOR) and other interbank-offered based reference rates as of the end of 2021. The ASU is effective for certain reference rate-related contract modifications that occur during the period March 12, 2020 through December 31, 2022. Management is currently evaluating the impact, if any, of applying this ASU.
13. Subsequent Events
The Funds have evaluated subsequent events through the issuance of the financial statements and determined that no events have occurred that require disclosure.
60 |
Annual Report | franklintempleton.com |
FRANKLIN MUNICIPAL SECURITIES TRUST
NOTES TO FINANCIAL STATEMENTS
Abbreviations
Selected Portfolio
franklintempleton.com | Annual Report | 61 |
FRANKLIN MUNICIPAL SECURITIES TRUST
Report of Independent Registered Public Accounting Firm
To the Board of Trustees of Franklin Municipal Securities Trust and Shareholders of Franklin Tennessee Municipal Bond Fund and Franklin California High Yield Municipal Fund
Opinions on the Financial Statements
We have audited the accompanying statements of assets and liabilities, including the statements of investments, of Franklin Tennessee Municipal Bond Fund and Franklin California High Yield Municipal Fund (constituting Franklin Municipal Securities Trust, hereafter collectively referred to as the Funds) as of May 31, 2020, the related statements of operations for the year ended May 31, 2020, the statements of changes in net assets for each of the two years in the period ended May 31, 2020, including the related notes, and the financial highlights for each of the periods indicated therein (collectively referred to as the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial positions of each of the Funds as of May 31, 2020, the results of each of their operations for the year then ended, the changes in each of their net assets for each of the two years in the period ended May 31, 2020 and each of the financial highlights for each of the periods indicated therein in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinions
These financial statements are the responsibility of the Funds management. Our responsibility is to express an opinion on the Funds financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Fund in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits of these financial statements in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our procedures included confirmation of securities owned as of May 31, 2020 by correspondence with the custodian. We believe that our audits provide a reasonable basis for our opinions.
PricewaterhouseCoopers LLP
San Francisco, California
July 17, 2020
We have served as the auditor of one or more investment companies in the Franklin Templeton Group of Funds since 1948.
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Tax Information (unaudited)
Under Section 852(b)(5)(A) of the Internal Revenue Code, the Funds hereby report 100% of the distributions paid from net investment income as exempt-interest dividends for the fiscal year ended May 31, 2020. A portion of the Funds exempt-interest dividends may be subject to the federal alternative minimum tax. By mid-February 2021, shareholders will be notified of amounts for use in preparing their 2020 income tax returns.
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Board Members and Officers
The name, year of birth and address of the officers and board members, as well as their affiliations, positions held with the Trust, principal occupations during at least the past five years and number of U.S. registered portfolios overseen in the Franklin Templeton fund complex, are shown below. Generally, each board member serves until that persons successor is elected and qualified.
Independent Board Members
Name, Year of Birth and Address |
Position | Length of Time Served |
Number of Portfolios in Fund Complex Overseen by Board Member* |
Other Directorships Held During at Least the Past 5 Years | ||||
Harris J. Ashton (1932) One Franklin Parkway San Mateo, CA 94403-1906 |
Trustee | Since 1991 | 129 | Bar-S Foods (meat packing company) (1981-2010). | ||||
Principal Occupation During at Least the Past 5 Years: Director of various companies; and formerly, Director, RBC Holdings, Inc. (bank holding company) (until 2002); and President, Chief Executive Officer and Chairman of the Board, General Host Corporation (nursery and craft centers) (until 1998).
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Terrence J. Checki (1945) One Franklin Parkway San Mateo, CA 94403-1906 |
Trustee | Since 2017 | 110 | Hess Corporation (exploration of oil and gas) (2014-present). | ||||
Principal Occupation During at Least the Past 5 Years: Member of the Council on Foreign Relations (1996-present); Member of the National Committee on U.S.-China Relations (1999-present); member of the Board of Trustees of the Economic Club of New York (2013-present); member of the Board of Trustees of the Foreign Policy Association (2005-present) and member of various other boards of trustees and advisory boards; and formerly, Executive Vice President of the Federal Reserve Bank of New York and Head of its Emerging Markets and Internal Affairs Group and Member of Management Committee (1995-2014); and Visiting Fellow at the Council on Foreign Relations (2014).
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Mary C. Choksi (1950) One Franklin Parkway San Mateo, CA 94403-1906 |
Trustee | Since 2014 | 129 | Avis Budget Group Inc. (car rental) (2007-present), Omnicom Group Inc. (advertising and marketing communications services) (2011-present) and White Mountains Insurance Group, Ltd. (holding company) (2017-present). | ||||
Principal Occupation During at Least the Past 5 Years: Director of various companies; and formerly, Founder and Senior Advisor, Strategic Investment Group (investment management group) (2015-2017); Founding Partner and Senior Managing Director, Strategic Investment Group (1987-2015); Founding Partner and Managing Director, Emerging Markets Management LLC (investment management firm) (1987-2011); and Loan Officer/Senior Loan Officer/Senior Pension Investment Officer, World Bank Group (international financial institution) (1977-1987).
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Edith E. Holiday (1952) One Franklin Parkway San Mateo, CA 94403-1906 |
Lead Independent Trustee | Trustee since 1998 and Lead Independent Trustee since 2019 | 129 | Hess Corporation (exploration of oil and gas) (1993-present), Canadian National Railway (railroad) (2001-present), White Mountains Insurance Group, Ltd. (holding company) (2004-present), Santander Consumer USA Holdings, Inc. (consumer finance) (2016-present); formerly, RTI International Metals, Inc. (manufacture and distribution of titanium) (1999-2015) and H.J. Heinz Company (processed foods and allied products) (1994-2013). |
Principal Occupation During at Least the Past 5 Years:
Director or Trustee of various companies and trusts; and formerly, Assistant to the President of the United States and Secretary of the Cabinet (1990-1993); General Counsel to the United States Treasury Department (1989-1990); and Counselor to the Secretary and Assistant Secretary for Public Affairs and Public LiaisonUnited States Treasury Department (1988-1989).
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Independent Board Members (continued)
Name, Year of Birth and Address |
Position | Length of Time Served |
Number of Portfolios in Fund Complex Overseen by Board Member* |
Other Directorships Held During at Least the Past 5 Years | ||||
J. Michael Luttig (1954) One Franklin Parkway San Mateo, CA 94403-1906 |
Trustee | Since 2009 | 129 | Boeing Capital Corporation (aircraft financing) (2006-2010). | ||||
Principal Occupation During at Least the Past 5 Years: Private investor; and formerly, Counselor and Senior Advisor to the Chairman, CEO, and Board of Directors, of The Boeing Company (aerospace company), and member of the Executive Council (May 2019-January 1, 2020); Executive Vice President, General Counsel and member of the Executive Council, The Boeing Company (2006-2019); and Federal Appeals Court Judge, United States Court of Appeals for the Fourth Circuit (1991-2006).
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Larry D. Thompson (1945) One Franklin Parkway San Mateo, CA 94403-1906 |
Trustee | Since 2007 | 129 | The Southern Company (energy company) (2014-present; previously 2010-2012), Graham Holdings Company (education and media organization) (2011-present) and Cbeyond, Inc. (business communications provider) (2010-2012). | ||||
Principal Occupation During at Least the Past 5 Years: Director of various companies; Counsel, Finch McCranie, LLP (law firm) (2015-present); Independent Compliance Monitor and Auditor, Volkswagen AG (manufacturer of automobiles and commercial vehicles) (2017-present); John A. Sibley Professor of Corporate and Business Law, University of Georgia School of Law (2015-present; previously 2011-2012); and formerly, Executive Vice President Government Affairs, General Counsel and Corporate Secretary, PepsiCo, Inc. (consumer products) (2012-2014); Senior Vice President Government Affairs, General Counsel and Secretary, PepsiCo, Inc. (2004-2011); Senior Fellow of The Brookings Institution (2003-2004); Visiting Professor, University of Georgia School of Law (2004); and Deputy Attorney General, U.S. Department of Justice (2001-2003).
Interested Board Members and Officers
| ||||||||
Name, Year of Birth and Address |
Position | Length of Time Served |
Number of Portfolios in Fund Complex Overseen by Board Member* |
Other Directorships Held During at Least the Past 5 Years | ||||
**Gregory E. Johnson (1961) One Franklin Parkway San Mateo, CA 94403-1906 |
Trustee | Since 2007 | 140 | None | ||||
Principal Occupation During at Least the Past 5 Years: Executive Chairman, Chairman of the Board and Director, Franklin Resources, Inc.; officer and/or director or trustee, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 39 of the investment companies in Franklin Templeton; Vice Chairman, Investment Company Institute; and formerly, Chief Executive Officer (2013-2020) and President (1994-2015), Franklin Resources, Inc.
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**Rupert H. Johnson, Jr. (1940) One Franklin Parkway San Mateo, CA 94403-1906 |
Chairman of the Board and Trustee | Since 2013 | 129 | None | ||||
Principal Occupation During at Least the Past 5 Years: Director (Vice Chairman), Franklin Resources, Inc.; Director, Franklin Advisers, Inc.; and officer and/or director or trustee, as the case may be, of some of the other subsidiaries of Franklin Resources, Inc. and of 37 of the investment companies in Franklin Templeton.
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Sheila Amoroso (1959) One Franklin Parkway San Mateo, CA 94403-1906 |
Vice President | Since 1999 | Not Applicable | Not Applicable |
Principal Occupation During at Least the Past 5 Years:
Senior Vice President, Franklin Advisers, Inc.; and officer of seven of the investment companies in Franklin Templeton.
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Interested Board Members and Officers (continued)
Name, Year of Birth and Address |
Position | Length of Time Served |
Number of Portfolios in Fund Complex Overseen by Board Member* |
Other Directorships Held During at Least the Past 5 Years | ||||
Alison E. Baur (1964) One Franklin Parkway San Mateo, CA 94403-1906 |
Vice President | Since 2012 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: Deputy General Counsel, Franklin Templeton; and officer of some of the other subsidiaries of Franklin Resources, Inc. and of 41 of the investment companies in Franklin Templeton.
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Breda M. Beckerle (1958) 280 Park Avenue New York, NY 10017 |
Interim Chief Compliance Officer | Since January 2020 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: Chief Compliance Officer, Fiduciary Investment Management International, Inc., Franklin Advisers, Inc., Franklin Advisory Services, LLC, Franklin Mutual Advisers, LLC, Franklin Templeton Institutional, LLC; and officer of 41 of the investment companies in Franklin Templeton.
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Sonal Desai, Ph.D. (1963) One Franklin Parkway San Mateo, CA 94403-1906 |
President and Chief Executive Officer Investment Management | Since 2018 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: Director and Executive Vice President, Franklin Advisers, Inc.; Executive Vice President, Franklin Templeton Institutional, LLC; and officer of 17 of the investment companies in Franklin Templeton.
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Gaston Gardey (1967) One Franklin Parkway San Mateo, CA 94403-1906 |
Treasurer, Chief Financial Officer and Chief Accounting Officer | Since 2009 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: Treasurer, U.S. Fund Administration & Reporting and officer of 24 of the investment companies in Franklin Templeton.
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Steven J. Gray (1955) One Franklin Parkway San Mateo, CA 94403-1906 |
Vice President and Co- Secretary | Vice President since 2009 and Co- Secretary since 2019 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: Senior Associate General Counsel, Franklin Templeton; Vice President, Franklin Templeton Distributors, Inc. and FASA, LLC; and officer of 41 of the investment companies in Franklin Templeton.
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Matthew T. Hinkle (1971) One Franklin Parkway San Mateo, CA 94403-1906 |
Chief Executive Officer Finance and Administration | Since 2017 | Not Applicable | Not Applicable |
Principal Occupation During at Least the Past 5 Years:
Senior Vice President, Franklin Templeton Services, LLC; officer of 41 of the investment companies in Franklin Templeton; and formerly, Vice President, Global Tax (2012-April 2017) and Treasurer/Assistant Treasurer, Franklin Templeton (2009-2017).
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Interested Board Members and Officers (continued)
Name, Year of Birth and Address |
Position | Length of Time Served |
Number of Portfolios in Fund Complex Overseen by Board Member* |
Other Directorships Held During at Least the Past 5 Years | ||||
Robert Lim (1948) One Franklin Parkway San Mateo, CA 94403-1906 |
Vice President AML Compliance | Since 2016 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: Vice President, Franklin Templeton Companies, LLC; Chief Compliance Officer, Franklin Templeton Distributors, Inc. and Franklin Templeton Investor Services, LLC; and officer of 41 of the investment companies in Franklin Templeton.
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Navid J. Tofigh (1972) One Franklin Parkway San Mateo, CA 94403-1906 |
Vice President | Since 2015 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: Associate General Counsel and officer of 41 of the investment companies in Franklin Templeton.
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Craig S. Tyle (1960) One Franklin Parkway San Mateo, CA 94403-1906 |
Vice President | Since 2005 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: General Counsel and Executive Vice President, Franklin Resources, Inc.; and officer of some of the other subsidiaries of Franklin Resources, Inc. and of 41 of the investment companies in Franklin Templeton.
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Thomas Walsh (1961) One Franklin Parkway San Mateo, CA 94403-1906 |
Vice President | Since 1999 | Not Applicable | Not Applicable | ||||
Principal Occupation During at Least the Past 5 Years: Senior Vice President, Franklin Advisers, Inc.; and officer of seven of the investment companies in Franklin Templeton.
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Lori A. Weber (1964) 300 S.E. 2nd Street Fort Lauderdale, FL 33301-1923 |
Vice President and Co-Secretary | Vice President since 2011 and Co- Secretary since 2019 | Not Applicable | Not Applicable |
Principal Occupation During at Least the Past 5 Years:
Senior Associate General Counsel, Franklin Templeton; Assistant Secretary, Franklin Resources, Inc.; Vice President and Secretary, Templeton Investment Counsel, LLC; and officer of 41 of the investment companies in Franklin Templeton.
*We base the number of portfolios on each separate series of the U.S. registered investment companies within the Franklin Templeton fund complex. These portfolios have a common investment manager or affiliated investment managers.
**Gregory E. Johnson is considered to be an interested person of the Fund under the federal securities laws due to his position as an officer and director of Franklin Resources, Inc. (Resources), which is the parent company of the Funds investment manager and distributor. Rupert H. Johnson, Jr. is considered to be an interested person of the Fund under the federal securities laws due to his position as an officer and director and major shareholder of Resources.
Note 1: Rupert H. Johnson, Jr. is the uncle of Gregory E. Johnson.
Note 2: Officer information is current as of the date of this report. It is possible that after this date, information about officers may change.
The Sarbanes-Oxley Act of 2002 and Rules adopted by the Securities and Exchange Commission require the Fund to disclose whether the Funds Audit Committee includes at least one member who is an audit committee financial expert within the meaning of such Act and Rules. The Funds Board has determined that there is at least one such financial expert on the Audit Committee and has designated Mary C. Choksi as its audit committee financial expert. The Board believes that Ms. Choksi qualifies as such an expert in view of her extensive business background and experience. She currently serves as a director of Avis Budget Group, Inc. (2007-present) and formerly, Founder and Senior Advisor, Strategic Investment Group (1987 to 2017). Ms. Choksi has been a Member of the Funds Audit Committee since 2014. As a result of such background and experience, the Board believes that Ms. Choksi has acquired an understanding of generally accepted accounting principles and financial statements, the general application of such principles in connection with the accounting estimates, accruals and reserves, and analyzing and evaluating financial statements that present a breadth and level of complexity of accounting issues generally comparable to those of the Fund, as well as an understanding of internal controls and procedures for financial reporting and an understanding of audit committee functions. Ms. Choksi is an independent Board member as that term is defined under the relevant Securities and Exchange Commission Rules and Releases.
The Statement of Additional Information (SAI) includes additional information about the board members and is available, without charge, upon request. Shareholders may call (800) DIAL BEN/342-5236 to request the SAI.
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Shareholder Information
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SHAREHOLDER INFORMATION
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SHAREHOLDER INFORMATION
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SHAREHOLDER INFORMATION
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Annual Report and Shareholder Letter Franklin Municipal Securities Trust |
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Investment Manager | Distributor | Shareholder Services | ||||
Franklin Advisers, Inc. | Franklin Templeton Distributors, Inc. | (800) 632-2301 | ||||
(800) DIAL BEN® / 342-5236 | ||||||
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© 2020 Franklin Templeton Investments. All rights reserved. | MUN A 07/20 |
Item 2. Code of Ethics.
(a) The Registrant has adopted a code of ethics that applies to its principal executive officers and principal financial and accounting officer.
(c) N/A
(d) N/A
(f) Pursuant to Item 13(a)(1), the Registrant is attaching as an exhibit a copy of its code of ethics that applies to its principal executive officers and principal financial and accounting officer.
Item 3. Audit Committee Financial Expert.
(a) (1) The Registrant has an audit committee financial expert serving on its audit committee.
(2) The audit committee financial expert is Mary C. Choksi and she is independent as defined under the relevant Securities and Exchange Commission Rules and Releases.
Item 4. Principal Accountant Fees and Services.
(a) Audit Fees
The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant for the audit of the registrants annual financial statements or for services that are normally provided by the principal accountant in connection with statutory and regulatory filings or engagements were $85,359 for the fiscal year ended May 31, 2020 and $78,628 for the fiscal year ended May 31, 2019.
(b) Audit-Related Fees
There were no fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrant that are reasonably related to the performance of the audit of the registrants financial statements and are not reported under paragraph (a) of Item 4.
There were no fees paid to the principal accountant for assurance and related services rendered by the principal accountant to the registrants investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant that are reasonably related to the performance of the audit of their financial statements.
(c) Tax Fees
There were no fees paid to the principal accountant for professional services rendered by the principal accountant to the registrant for tax compliance, tax advice and tax planning.
The aggregate fees paid to the principal accountant for professional services rendered by the principal accountant to the registrants
investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant for tax compliance, tax advice and tax planning were $0 for the fiscal year ended May 31, 2020 and $25,000 for the fiscal year ended May 31, 2019. The services for which these fees were paid included professional fees in connection with tax treatment of equipment lease transactions, professional fees in connection with an Indonesia withholding tax refund claim and tax consulting services related to the operating agreement and term sheet for the launch of a new fund.
(d) All Other Fees
The aggregate fees paid to the principal accountant for products and services rendered by the principal accountant to the registrant not reported in paragraphs (a)-(c) of Item 4 were $1,329 for the fiscal year ended May 31, 2020 and $0 for the fiscal year ended May 31, 2019. The services for which these fees were paid included review of materials provided to the fund Board in connection with the investment management contract renewal process.
The aggregate fees paid to the principal accountant for products and services rendered by the principal accountant to the registrants investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant not reported in paragraphs (a)-(c) of Item 4 were $197,944 for the fiscal year ended May 31, 2020 and $16,500 for the fiscal year ended May 31, 2019. The services for which these fees were paid included the issuance of an Auditors Certificate for South Korean regulatory shareholders disclosures, valuation services related to a fair value engagement, professional fees in connection with determining the feasibility of a U.S. direct lending structure, benchmarking services in connection with the ICI TA survey, and assets under management certification.
(e) (1) The registrants audit committee is directly responsible for approving the services to be provided by the auditors, including:
(i) pre-approval of all audit and audit related services;
(ii) pre-approval of all non-audit related services to be provided to the Fund by the auditors;
(iii) pre-approval of all non-audit related services to be provided to the registrant by the auditors to the registrants investment adviser or to any entity that controls, is controlled by or is under common control with the registrants investment adviser and that provides ongoing services to the registrant where the non-audit services relate directly to the operations or financial reporting of the registrant; and
(iv) establishment by the audit committee, if deemed necessary or appropriate, as an alternative to committee pre-approval of services to be provided by the auditors, as required by paragraphs (ii) and (iii) above, of policies and procedures to permit such services to be pre-approved by other means, such as through establishment of guidelines or by action of a designated member or members of the committee; provided the policies and procedures are detailed as to the
particular service and the committee is informed of each service and such policies and procedures do not include delegation of audit committee responsibilities, as contemplated under the Securities Exchange Act of 1934, to management; subject, in the case of (ii) through (iv), to any waivers, exceptions or exemptions that may be available under applicable law or rules.
(e) (2) None of the services provided to the registrant described in paragraphs (b)-(d) of Item 4 were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of regulation S-X.
(f) No disclosures are required by this Item 4(f).
(g) The aggregate non-audit fees paid to the principal accountant for services rendered by the principal accountant to the registrant and the registrants investment adviser and any entity controlling, controlled by or under common control with the investment adviser that provides ongoing services to the registrant were $199,273 for the fiscal year ended May 31, 2020 and $41,500 for the fiscal year ended May 31, 2019.
(h) The registrants audit committee of the board has considered whether the provision of non-audit services that were rendered to the registrants investment adviser (not including any sub-adviser whose role is primarily portfolio management and is subcontracted with or overseen by another investment adviser), and any entity controlling, controlled by, or under common control with the investment adviser that provides ongoing services to the registrant that were not pre-approved pursuant to paragraph (c)(7)(ii) of Rule 2-01 of Regulation S-X is compatible with maintaining the principal accountants independence.
Item 5. Audit Committee of Listed Registrants. N/A
Item 6. Schedule of Investments. N/A
Item 7. Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. N/A
Item 8. Portfolio Managers of Closed-End Management Investment Companies. N/A
Item 9. Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. N/A
Item 10. Submission of Matters to a Vote of Security Holders.
There have been no changes to the procedures by which shareholders may recommend nominees to the Registrants Board of Trustees that would require disclosure herein.
Item 11. Controls and Procedures.
(a) Evaluation of Disclosure Controls and Procedures. The Registrant maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the Registrants filings under the Securities Exchange Act of 1934, as amended, and the Investment Company Act of 1940 is recorded, processed, summarized and reported within the periods specified in the rules and forms of the Securities and Exchange Commission. Such information is accumulated and communicated to the Registrants management, including its principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. The Registrants management, including the principal executive officer and the principal financial officer, recognizes that any set of controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives.
Within 90 days prior to the filing date of this Shareholder Report on Form N-CSR, the Registrant had carried out an evaluation, under the supervision and with the participation of the Registrants management, including the Registrants principal executive officer and the Registrants principal financial officer, of the effectiveness of the design and operation of the Registrants disclosure controls and procedures. Based on such evaluation, the Registrants principal executive officer and principal financial officer concluded that the Registrants disclosure controls and procedures are effective.
(b) Changes in Internal Controls. There have been no changes in the Registrants internal control over financial reporting that occurred during the period covered by this report that has materially affected, or is reasonably likely to materially affect the internal control over financial reporting.
Item 12. Disclosure of Securities Lending Activities for Closed-End Management Investment Company. N/A
Item 13. Exhibits.
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.
FRANKLIN MUNICIPAL SECURITIES TRUST
By | /S/ MATTHEW T. HINKLE | |
Matthew T. Hinkle | ||
Chief Executive Officer Finance and Administration | ||
Date | July 31, 2020 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By | /S/ MATTHEW T. HINKLE | |
Matthew T. Hinkle | ||
Chief Executive Officer Finance and Administration | ||
Date | July 31, 2020 | |
By | /S/ GASTON GARDEY | |
Gaston Gardey | ||
Chief Financial Officer and Chief Accounting Officer | ||
Date | July 31, 2020 |
Code of Ethics for Principal Executives & Senior Financial Officers
Procedures | Revised December 10, 2018
|
FRANKLIN TEMPLETON FUNDS
CODE OF ETHICS FOR PRINCIPAL EXECUTIVES AND
SENIOR FINANCIAL OFFICERS
I. | Covered Officers and Purpose of the Code |
This code of ethics (the Code) applies to the Principal Executive Officers, Principal Financial Officer and Principal Accounting Officer (the Covered Officers, each of whom is set forth in Exhibit A) of each investment company advised by a Franklin Resources subsidiary and that is registered with the United States Securities & Exchange Commission (SEC) (collectively, FT Funds) for the purpose of promoting:
| Honest and ethical conduct, including the ethical resolution of actual or apparent conflicts of interest between personal and professional relationships; |
| Full, fair, accurate, timely and understandable disclosure in reports and documents that a registrant files with, or submits to, the SEC and in other public communications made by or on behalf of the FT Funds; |
| Compliance with applicable laws and governmental rules and regulations; |
| The prompt internal reporting of violations of the Code to an appropriate person or persons identified in the Code; and |
| Accountability for adherence to the Code. |
Each Covered Officer will be expected to adhere to a high standard of business ethics and must be sensitive to situations that may give rise to actual as well as apparent conflicts of interest.
* | Rule 38a-1 under the Investment Company Act of 1940 (1940 Act) and Rule 206(4)-7 under the Investment Advisers Act of 1940 (Advisers Act) (together the Compliance Rule) require registered investment companies and registered investment advisers to, among other things, adopt and implement written policies and procedures reasonably designed to prevent violations of the federal securities laws (Compliance Rule Policies and Procedures). |
CONFIDENTIAL INFORMATION. This document is the proprietary product of Franklin Templeton Investments. It may NOT be distributed outside the company unless it is made subject to a non-disclosure agreement and/or such release receives authorization by an FTI Chief Compliance Officer. Any unauthorized use, reproduction or transfer of this document is strictly prohibited. Franklin Templeton Investments © 2014. All Rights Reserved.
FTI Compliance Procedures | Standards of Business Conduct |
II. | Other Policies and Procedures |
This Code shall be the sole code of ethics adopted by the Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder.
Franklin Resources, Inc. has separately adopted the Code of Ethics and Business Conduct (Business Conduct), which is applicable to all officers, directors and employees of Franklin Resources, Inc., including Covered Officers. It summarizes the values, principles and business practices that guide the employees business conduct and also provides a set of basic principles to guide officers, directors and employees regarding the minimum ethical requirements expected of them. It supplements the values, principles and business conduct identified in the Code and other existing employee policies.
Additionally, the Franklin Templeton Funds have separately adopted the FTI Personal Investments and Insider Trading Policy governing personal securities trading and other related matters. The Code for Insider Trading provides for separate requirements that apply to the Covered Officers and others, and therefore is not part of this Code.
Insofar as other policies or procedures of Franklin Resources, Inc., the Funds, the Funds adviser, principal underwriter, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superceded by this Code to the extent that they overlap or conflict with the provisions of this Code. Please review these other documents or consult with the Legal Department if have questions regarding the applicability of these policies to you.
III. | Covered Officers Should Handle Ethically Actual and Apparent Conflicts of Interest |
Overview. A conflict of interest occurs when a Covered Officers private interest interferes with the interests of, or his or her service to, the FT Funds. For example, a conflict of interest would arise if a Covered Officer, or a member of his family, receives improper personal benefits as a result of apposition with the FT Funds.
Certain conflicts of interest arise out of the relationships between Covered Officers and the FT Funds and already are subject to conflict of interest provisions in the Investment Company Act of 1940 (Investment Company Act) and the Investment Advisers Act of 1940 (Investment Advisers Act). For example, Covered Officers may not individually engage in certain transactions (such as the purchase or sale of securities or other property) with the FT Funds because of their status as affiliated persons of the FT Funds. The FT Funds and the investment advisers compliance programs and procedures are designed to prevent, or identify and correct, violations of these provisions. This Code does not, and is not intended to, repeat or replace these programs and procedures, and such conflicts fall outside of the parameters of this Code.
Although typically not presenting an opportunity for improper personal benefit, conflicts arise from, or as a result of, the contractual relationship between the FT Funds, the investment advisers and the fund administrator of which the Covered Officers are also officers or employees. As a result, this Code recognizes that the Covered Officers will, in the normal course of their duties (whether formally for the FT Funds, for the adviser, the administrator, or
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FTI Compliance Procedures | Standards of Business Conduct |
for all three), be involved in establishing policies and implementing decisions that will have different effects on the adviser, administrator and the FT Funds. The participation of the Covered Officers in such activities is inherent in the contractual relationship between the FT Funds, the adviser, and the administrator and is consistent with the performance by the Covered Officers of their duties as officers of the FT Funds. Thus, if performed in conformity with the provisions of the Investment Company Act and the Investment Advisers Act, such activities will be deemed to have been handled ethically. In addition, it is recognized by the FT Funds Boards of Directors (Boards) that the Covered Officers may also be officers or employees of one or more other investment companies covered by this or other codes.
Other conflicts of interest are covered by the Code, even if such conflicts of interest are not subject to provisions in the Investment Company Act and the Investment Advisers Act. The following list provides examples of conflicts of interest under the Code, but Covered Officers should keep in mind that these examples are not exhaustive. The overarching principle is that the personal interest of a Covered Officer should not be placed improperly before the interest of the FT Funds.
Each Covered Officer must:
| Not use his or her personal influence or personal relationships improperly to influence investment decisions or financial reporting by the FT Funds whereby the Covered Officer would benefit personally to the detriment of the FT Funds; |
| Not cause the FT Funds to take action, or fail to take action, for the individual personal benefit of the Covered Officer rather than the benefit the FT Funds; |
| Not retaliate against any other Covered Officer or any employee of the FT Funds or their affiliated persons for reports of potential violations that are made in good faith; |
| Report at least annually the following affiliations or other relationships:1 |
| all directorships for public companies and all companies that are required to file reports with the SEC; |
| any direct or indirect business relationship with any independent directors of the FT Funds; |
| any direct or indirect business relationship with any independent public accounting firm (which are not related to the routine issues related to the firms service as the Covered Persons accountant); and |
| any direct or indirect interest in any transaction with any FT Fund that will benefit the officer (not including benefits derived from the advisory, sub-advisory, distribution or service agreements with affiliates of Franklin Resources). |
These reports will be reviewed by the Legal Department for compliance with the Code.
There are some conflict of interest situations that should always be approved in writing by Franklin Resources General Counsel or Deputy General Counsel, if material. Examples of these include2:
| Service as a director on the board of any public or private Company. |
1 | Reporting of these affiliations or other relationships shall be made by completing the annual Directors and Officers Questionnaire and returning the questionnaire to Franklin Resources Inc, General Counsel or Deputy General Counsel. |
2 | Any activity or relationship that would present a conflict for a Covered Officer may also present a conflict for the Covered Officer if a member of the Covered Officers immediate family engages in such an activity or has such a relationship. The Cover Person should also obtain written approval by FTs General Counsel in such situations. |
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FTI Compliance Procedures | Standards of Business Conduct |
| The receipt of any gifts in excess of $100 from any person, from any corporation or association. |
| The receipt of any entertainment from any Company with which the FT Funds has current or prospective business dealings unless such entertainment is business related, reasonable in cost, appropriate as to time and place, and not so frequent as to raise any question of impropriety. Notwithstanding the foregoing, the Covered Officers must obtain prior approval from the Franklin Resources General Counsel for any entertainment with a value in excess of $1000. |
| Any ownership interest in, or any consulting or employment relationship with, any of the FT Funds service providers, other than an investment adviser, principal underwriter, administrator or any affiliated person thereof. |
| A direct or indirect financial interest in commissions, transaction charges or spreads paid by the FT Funds for effecting portfolio transactions or for selling or redeeming shares other than an interest arising from the Covered Officers employment, such as compensation or equity ownership. |
| Franklin Resources General Counsel or Deputy General Counsel will provide a report to the FT Funds Audit Committee of any approvals granted at the next regularly scheduled meeting. |
IV. | Disclosure and Compliance |
| Each Covered Officer should familiarize himself with the disclosure requirements generally applicable to the FT Funds; |
| Each Covered Officer should not knowingly misrepresent, or cause others to misrepresent, facts about the FT Funds to others, whether within or outside the FT Funds, including to the FT Funds directors and auditors, and to governmental regulators and self-regulatory organizations; |
| Each Covered Officer should, to the extent appropriate within his or her area of responsibility, consult with other officers and employees of the FT Funds, the FT Funds adviser and the administrator with the goal of promoting full, fair, accurate, timely and understandable disclosure in the reports and documents the FT Funds file with, or submit to, the SEC and in other public communications made by the FT Funds; and |
| It is the responsibility of each Covered Officer to promote compliance with the standards and restrictions imposed by applicable laws, rules and regulations. |
V. | Reporting and Accountability |
Each Covered Officer must:
| Upon becoming a covered officer affirm in writing to the Board that he or she has received, read, and understands the Code (see Exhibit B); |
| Annually thereafter affirm to the Board that he has complied with the requirements of the Code; and |
| Notify Franklin Resources General Counsel or Deputy General Counsel promptly if he or she knows of any violation of this Code. Failure to do so is itself is a violation of this Code. |
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FTI Compliance Procedures | Standards of Business Conduct |
Franklin Resources General Counsel and Deputy General Counsel are responsible for applying this Code to specific situations in which questions are presented under it and have the authority to interpret this Code in any particular situation.3 However, the Independent Directors of the respective FT Funds will consider any approvals or waivers4 sought by any Chief Executive Officers of the Funds.
The FT Funds will follow these procedures in investigating and enforcing this Code:
| Franklin Resources General Counsel or Deputy General Counsel will take all appropriate action to investigate any potential violations reported to the Legal Department; |
| If, after such investigation, the General Counsel or Deputy General Counsel believes that no violation has occurred, The General Counsel is not required to take any further action; |
| Any matter that the General Counsel or Deputy General Counsel believes is a violation will be reported to the Independent Directors of the appropriate FT Fund; |
| If the Independent Directors concur that a violation has occurred, it will inform and make a recommendation to the Board of the appropriate FT Fund or Funds, which will consider appropriate action, which may include review of, and appropriate modifications to, applicable policies and procedures; notification to appropriate personnel of the investment adviser or its board; or a recommendation to dismiss the Covered Officer; |
| The Independent Directors will be responsible for granting waivers, as appropriate; and |
| Any changes to or waivers of this Code will, to the extent required, are disclosed as provided by SEC rules.5 |
VI. | Other Policies and Procedures |
This Code shall be the sole code of ethics adopted by the FT Funds for purposes of Section 406 of the Sarbanes-Oxley Act and the rules and forms applicable to registered investment companies thereunder. Insofar as other policies or procedures of the FT Funds, the FT Funds advisers, principal underwriter, or other service providers govern or purport to govern the behavior or activities of the Covered Officers who are subject to this Code, they are superseded by this Code to the extent that they overlap or conflict with the provisions of this Code. The FTI Personal Investments and Insider Trading Policy, adopted by the FT Funds, FT investment advisers and FT Funds principal underwriter pursuant to Rule 17j-1 under the Investment Company Act, the Code of Ethics and Business Conduct and more detailed policies and procedures set forth in FTs Employee Handbook are separate requirements applying to the Covered Officers and others, and are not part of this Code.
3 | Franklin Resources General Counsel and Deputy General Counsel are authorized to consult, as appropriate, with members of the Audit Committee, counsel to the FT Funds and counsel to the Independent Directors, and are encouraged to do so. |
4 | Item 2 of Form N-CSR defines waiver as the approval by the registrant of a material departure from a provision of the code of ethics and implicit waiver, which must also be disclosed, as the registrants failure to take action within a reasonable period of time regarding a material departure from a provision of the code of ethics that has been made known to an executive officer of the registrant. See Part X. |
5 | See Part X. |
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FTI Compliance Procedures | Standards of Business Conduct |
VII. | Amendments |
Any amendments to this Code, other than amendments to Exhibit A, must be approved or ratified by a majority vote of the FT Funds Board including a majority of independent directors.
VIII. Confidentiality
All reports and records prepared or maintained pursuant to this Code will be considered confidential and shall be maintained and protected accordingly. Except as otherwise required by law or this Code, such matters shall not be disclosed to anyone other than the FT Funds Board and their counsel.
IX. | Internal Use |
The Code is intended solely for the internal use by the FT Funds and does not constitute an admission, by or on behalf of any FT Funds, as to any fact, circumstance, or legal conclusion.
X. | Disclosure on Form N-CSR |
Item 2 of Form N-CSR requires a registered management investment company to disclose annually whether, as of the end of the period covered by the report, it has adopted a code of ethics that applies to the registrants principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, regardless of whether these officers are employed by the registrant or a third party. If the registrant has not adopted such a code of ethics, it must explain why it has not done so.
The registrant must also: (1) file with the SEC a copy of the code as an exhibit to its annual report; (2) post the text of the code on its Internet website and disclose, in its most recent report on Form N-CSR, its Internet address and the fact that it has posted the code on its Internet website; or (3) undertake in its most recent report on Form N-CSR to provide to any person without charge, upon request, a copy of the code and explain the manner in which such request may be made. Disclosure is also required of amendments to, or waivers (including implicit waivers) from, a provision of the code in the registrants annual report on Form N-CSR or on its website. If the registrant intends to satisfy the requirement to disclose amendments and waivers by posting such information on its website, it will be required to disclose its Internet address and this intention.
The Legal Department shall be responsible for ensuring that:
| a copy of the Code is filed with the SEC as an exhibit to each Funds annual report; and |
| any amendments to, or waivers (including implicit waivers) from, a provision of the Code is disclosed in the registrants annual report on Form N-CSR. |
In the event that the foregoing disclosure is omitted or is determined to be incorrect, the Legal Department shall promptly file such information with the SEC as an amendment to Form N-CSR.
In such an event, the Fund Chief Compliance Officer shall review the Code and propose such changes to the Code as are necessary or appropriate to prevent reoccurrences.
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FTI Compliance Procedures | Standards of Business Conduct |
EXHIBIT A
Persons Covered by the Franklin Templeton Funds
Code of Ethics
December 2018
FRANKLIN GROUP OF FUNDS
Edward Perks | President and Chief Executive Officer Investment Management | |
Rupert H. Johnson, Jr. | Chairman of the Board and Vice President Investment Management | |
Don Taylor | President and Chief Executive Officer Investment Management | |
Sonal Desai) | President and Chief Executive Officer Investment Management | |
Matthew Hinkle | Chief Executive Officer Finance and Administration | |
Gaston R. Gardey | Chief Financial Officer and Chief Accounting Officer and Treasurer |
FRANKLIN MUTUAL SERIES FUNDS
Peter Langerman |
Chief Executive Officer Investment Management | |
Matthew Hinkle |
Chief Executive Officer Finance and Administration | |
Robert G. Kubilis |
Chief Financial Officer and Chief Accounting Officer |
FRANKLIN ALTERNATIVE STRATEGIES FUNDS
Mat S. Gulley |
Chief Executive Officer Investment Management | |
Matthew Hinkle |
Chief Executive Officer Finance and Administration | |
Robert G. Kubilis |
Chief Financial Officer and Chief Accounting Officer |
TEMPLETON GROUP OF FUNDS
Manraj S. Sekhon |
President and Chief Executive Officer Investment Management | |
Michael Hasenstab, Ph.D. |
President and Chief Executive Officer Investment Management | |
Norman Boersma |
President and Chief Executive Officer Investment Management | |
Matthew Hinkle |
Chief Executive Officer Finance and Administration | |
Robert G. Kubilis |
Chief Financial Officer, Chief Accounting Officer and Treasurer |
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FTI Compliance Procedures | Standards of Business Conduct |
Exhibit B
ACKNOWLEDGMENT FORM
Franklin Templeton Funds Code of Ethics
For Principal Executives and Senior Financial Officers
Instructions: | |
1. | Complete all sections of this form. |
2. | Print the completed form, sign, and date. |
3. | Submit completed form to FTs General Counsel c/o Code of Ethics Administration within 10 days of becoming a Covered Officer and by February 15th of each subsequent year. |
Inter-office mail: | Code of Ethics Administration, Global Compliance SM-920/2 | |
Fax: | (650) 312-5646 | |
E-mail: | Code of Ethics Inquiries & Requests (internal address); | |
[email protected] (external address) |
Covered Officers Name:
|
||
Title:
|
||
Department:
|
||
Location:
|
||
Certification for Year Ending: |
To: | Franklin Resources General Counsel, Legal Department |
I acknowledge receiving, reading and understanding the Franklin Templeton Funds Code of Ethics for Principal Executive Officers and Senior Financial Officers (the Code). I will comply fully with all provisions of the Code to the extent they apply to me during the period of my employment. I further understand and acknowledge that any violation of the Code may subject me to disciplinary action, including termination of employment.
|
|
| ||
Signature |
Date signed |
8
Exhibit 13 (a) (2)
I, Matthew T. Hinkle, certify that:
1. I have reviewed this report on Form N-CSR of Franklin Municipal Securities Trust;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting 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 registrants internal control over financial reporting; and
5. The registrants other certifying officer(s) and I have disclosed to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
7/31/2020
/S/ MATTHEW T. HINKLE |
Matthew T. Hinkle |
Chief Executive Officer - Finance and Administration |
Exhibit 13 (a) (2)
I, Gaston Gardey, certify that:
1. I have reviewed this report on Form N-CSR of Franklin Municipal Securities Trust;
2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations, changes in net assets, and cash flows (if the financial statements are required to include a statement of cash flows) of the registrant as of, and for, the periods presented in this report;
4. The registrants other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Rule 30a-3(c) under the Investment Company Act of 1940) and internal control over financial reporting (as defined in Rule 30a-3(d) under the Investment Company Act of 1940) for the registrant and have:
(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
(c) Evaluated the effectiveness of the registrants disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of a date within 90 days prior to the filing date of this report based on such evaluation; and
(d) Disclosed in this report any change in the registrants internal control over financial reporting 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 registrants internal control over financial reporting; and
5. The registrants other certifying officer(s) and I have disclosed to the registrants auditors and the audit committee of the registrants board of directors (or persons performing the equivalent functions):
(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrants ability to record, process, summarize, and report financial information; and
(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrants internal control over financial reporting.
7/31/2020
/S/ GASTON GARDEY |
Gaston Gardey |
Chief Financial Officer and Chief Accounting Officer |
Exhibit 13 (b)
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002
I, Matthew T. Hinkle, Chief Executive Officer of the Franklin Municipal Securities Trust (the Registrant), certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. | The periodic report on Form N-CSR of the Registrant for the period ended 5/31/2020 (the Form N-CSR) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. |
Dated: 7/31/2020
/S/ MATTHEW T. HINKLE |
Matthew T. Hinkle |
Chief Executive Officer - Finance and Administration |
Exhibit 13 (b)
CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002
I, Gaston Gardey, Chief Financial Officer of the Franklin Municipal Securities Trust (the Registrant), certify, pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:
1. | The periodic report on Form N-CSR of the Registrant for the period ended 5/31/2020 (the Form N-CSR) fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information contained in the Form N-CSR fairly presents, in all material respects, the financial condition and results of operations of the Registrant. |
Dated: 7/31/2020
/S/ GASTON GARDEY |
Gaston Gardey |
Chief Financial Officer and Chief Accounting Officer |
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