As filed with the Securities and Exchange
Commission on July 26, 2000

Registration No. 33-18779
811-5406

SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549

FORM N-1A

REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933

[ ] Pre-Effective Amendment No.

[X] Post-Effective Amendment No.    21

REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940, as amended

Amendment No.     23    [X]

SMITH BARNEY NEW JERSEY MUNICIPALS FUND INC.
(Exact name of Registrant as Specified in Charter)

7 World Trade Center, New York, New York 10048
(Address of principal executive offices) (Zip Code)

(212)783-0693
(Registrant's telephone number, including Area Code)

Christina T. Sydor
7 World Trade Center, New York, New York 100148
(Name and address of agent for service)

Continuous
(Approximate Date of Proposed Public Offering)


It is proposed that this filing becomes effective
(check appropriate
box):


[  ]  Immediately upon filing pursuant to paragraph b
[X ]   on July 30, 2001 pursuant to paragraph b
[  ]  60 days after filing pursuant to paragraph
(a)(1)
[  ]  on (date) pursuant to paragraph (a)(1)
[  ]  75 days after filing pursuant to paragraph
(a)(2)
[  ]  on (date) pursuant to paragraph (a) (2) of Rule
485


If appropriate, check the following box:

[  ]  This post-effective amendment designates a new
effective date for a previously filed post-effective
amendment



PART  A-Prospectus


<PAGE>

                                  PROSPECTUS



            ------------------------------------------
-------


                            SMITH BARNEY NEW JERSEY

                             MUNICIPALS FUND INC.

            ------------------------------------------
-------

      Class A, B, L and Y Shares

      July 30, 2001





      The Securities and Exchange Commission has not
approved or disapproved
      these securities or determined whether this
prospectus is accurate or
      complete. Any statement to the contrary is a
crime.



                         [LOGO] Smith Barney
                                Mutual Funds
                         Your Serious Money.
Professionally Managed./SM/

           -------------------------------------------
--------------
  INVESTMENT PRODUCTS: NOT FDIC INSURED . NO BANK
GUARANTEE . MAY LOSE VALUE
           -------------------------------------------
--------------

<PAGE>


Smith Barney New Jersey Municipals Fund Inc.



  Contents


<TABLE>
<S>                                <C>
Investments, risks and performance  2
More on the fund's investments....  7
Management........................  8
Choosing a class of shares to buy.  9
Comparing the fund's classes...... 10
</TABLE>

<TABLE>
<S>                                           <C>
Sales charges................................ 11
More about deferred sales charges............ 13
Buying shares................................ 14
Exchanging shares............................ 15
Redeeming shares............................. 17
Other things to know about share transactions 19
Dividends, distributions and taxes........... 21
Share price.................................. 22
Financial highlights......................... 23
</TABLE>




1



Smith Barney Mutual Funds

<PAGE>

  Investments, risks and performance

Investment objective
The fund seeks to provide New Jersey investors with as
high a level of current
income exempt from federal income taxes and New Jersey
personal income taxes as
is consistent with prudent investment management and
the preservation of
capital.

Principal investment strategies

Key investments The fund invests at least 80% of its
net assets in municipal
securities, and at least 65% of its net assets in
primarily New Jersey
municipal securities. New Jersey municipal securities
include securities issued
by the State of New Jersey and certain other municipal
issuers, political
subdivisions, agencies and public authorities that pay
interest which is exempt
from New Jersey personal income taxes. The fund
focuses primarily on
intermediate-term and long-term municipal securities
which have remaining
maturities at the time of purchase of from three to
more than thirty years. The
fund can invest up to 25% of its assets in bonds rated
below investment grade
or in unrated securities of equivalent quality
(commonly known as "junk
bonds"). Investment grade bonds are those rated in any
of the four highest
long-term rating categories by a nationally recognized
ratings organization, or
if unrated, determined by the manager to be of
comparable quality.


Selection process The manager selects securities
primarily by identifying
undervalued sectors and individual securities, while
also selecting securities
it believes will benefit from changes in market
conditions. In selecting
individual securities, the manager:

 . Uses fundamental credit analysis to estimate the
relative value and
  attractiveness of various securities and sectors and
to exploit opportunities
  in the municipal bond market
 . May trade between general obligation and revenue
bonds and among various
  revenue bond sectors, such as housing, hospital and
industrial development,
  based on their apparent relative values
 . Considers the yield available for securities with
different maturities and a
  security's maturity in light of the outlook for the
issuer and its sector and
  interest rates
 . Identifies individual securities with the most
potential for added value,
  such as those involving unusual situations, new
issuers, the potential for
  credit upgrades, unique structural characteristics
or innovative features


Smith Barney New Jersey Municipals Fund Inc.

2

<PAGE>



Principal risks of investing in the fund
Investors could lose money on their investment in the
fund, or the fund may not
perform as well as other investments, if:

 . Interest rates rise, causing the value of the fund's
portfolio to decline
 . The issuer of a security owned by the fund defaults
on its obligation to pay
  principal and/or interest or the security's credit
rating is downgraded
 . New Jersey municipal securities fall out of favor
with investors. The fund
  will suffer more than a national municipal fund from
adverse events affecting
  New Jersey municipal issuers
 . Unfavorable legislation affects the tax-exempt
status of municipal bonds
 . The manager's judgment about the attractiveness,
value or income potential of
  a particular security proves to be incorrect


It is possible that some of the fund's income
distributions may be, and
distributions of the fund's gains generally will be,
subject to federal and New
Jersey state taxation. The fund may realize taxable
gains on the sale of its
securities or on transactions in futures contracts.
Some of the fund's income
may be subject to the federal alternative minimum tax.
In addition,
distributions of the fund's income and gains will
generally be taxable to
investors in states other than New Jersey.


The fund is classified as "non-diversified," which
means it may invest a larger
percentage of its assets in one issuer than a
diversified fund. To the extent
the fund invests its assets in fewer issuers, the fund
will be more susceptible
to negative events affecting those issuers.

Who may want to invest The fund may be an appropriate
investment if you:


 . Are a New Jersey taxpayer in a high federal tax
bracket seeking income exempt
  from regular federal income tax and New Jersey
personal income tax

 . Currently have exposure to other asset classes and
are seeking to broaden
  your investment portfolio
 . Are willing to accept the risks of municipal
securities, including the risks
  of concentrating in investments in a single state


3



Smith Barney Mutual Funds

<PAGE>

Risk return bar chart
This bar chart indicates the risks of investing in the
fund by showing changes
in the fund's performance from year to year. Past
performance does not
necessarily indicate how the fund will perform in the
future. The bar chart
shows the performance of the fund's Class A shares for
each of the past 10
calendar years. Class B, L and Y shares have different
performance because of
different expenses. The performance information in the
chart does not reflect
sales charges, which would reduce your return.

                        Total Return for Class A
Shares


                                    [CHART]
                                  91   12.22
                                  92    9.43
                                  93   12.98
                                  94      -7
                                  95   17.12
                                  96    4.14
                                  97    9.26
                                  98       6
                                  99   -6.15
                                  00   10.43

                        Calendar years ended December
31

Quarterly returns:

Highest: 7.12% in 1st quarter 1995; Lowest: (6.34)% in
1st quarter 1994
Year to date: 3.28% through 6/30/01


Smith Barney New Jersey Municipals Fund Inc.

4

<PAGE>



Risk return table
This table indicates the risks of investing in the
fund by comparing the
average annual total return of each class for the
periods shown with that of
the Lehman Brothers Municipal Bond Index (the "Lehman
Index"), a broad-based
unmanaged index of municipal bonds and the Lipper New
Jersey Municipal Debt
Funds Average (the "Lipper Average"), an average
composed of the fund's peer
group of mutual funds. This table assumes imposition
of the maximum sales
charge applicable to the class, redemption of shares
at the end of the period,
and reinvestment of distributions and dividends.

                         Average Annual Total Returns

                    Calendar Years Ended December 31,
2000


<TABLE>
<CAPTION>
                                           Since
Inception
                 1 year 5 years 10 years Inception
Date

<S>              <C>    <C>     <C>      <C>       <C>
 Class A          6.04%   3.72%    6.13%     6.95%
4/22/88

 Class B          5.29%   3.86%     n/a      5.21%
11/6/92

 Class L          7.74%   3.75%     n/a      5.89%
12/13/94

 Class Y*          n/a     n/a      n/a       n/a
11/07/94

 Lehman Index    11.68%   5.84%    7.32%      n/a
n/a

 Lipper Average  10.85%   4.63%    6.57%      n/a
n/a
</TABLE>





* There were no Class Y Shares outstanding for the
calendar year ended December
31, 2000.



5



Smith Barney Mutual Funds

<PAGE>

Fee table
This table sets forth the fees and expenses you will
pay if you invest in fund
shares.

                               Shareholder fees


<TABLE>
<CAPTION>
 (fees paid directly from your investment)  Class A
Class B Class L Class Y

<S>                                         <C>
<C>     <C>     <C>
 Maximum sales charge (load) imposed
 on purchases (as a % of offering price)     4.00%
None   1.00%      None

 Maximum deferred sales charge (load)
 (as a % of the lower of net asset value
 at purchase or redemption)                   None*
4.50%   1.00%      None

                       Annual fund operating expenses

<CAPTION>
 (expenses deducted from fund assets)       Class A
Class B Class L Class Y**

<S>                                         <C>
<C>     <C>     <C>
 Management fees                             0.50%
0.50%   0.50%     0.50%

 Distribution and service (12b-1) fees       0.15%
0.65%   0.70%      None

 Other expenses                              0.11%
0.14%   0.13%     0.11%
                                             -----   -
----   -----    -----
 Total annual fund operating expenses        0.76%
1.29%   1.33%     0.61%
</TABLE>


*You may buy Class A shares in amounts of $500,000 or
more at net asset value
(without an initial sales charge) but if you redeem
those shares within 12
months of their purchase, you will pay a deferred
sales charge of 1.00%.


**"Other expenses" have been estimated based on
expenses incurred by Class A
shares because no Class Y shares were outstanding for
the fiscal year ended
March 31, 2001.


Example
This example helps you compare the costs of investing
in the fund with the
costs of investing in other mutual funds. Your actual
costs may be higher or
lower. The example assumes:
 . You invest $10,000 in the fund for the period shown
 . Your investment has a 5% return each year
 . You reinvest all distributions and dividends without
a sales charge
 . The fund's operating expenses remain the same

                      Number of years you own your
shares

<TABLE>
<CAPTION>
                                        1 year 3 years
5 years 10 years

<S>                                     <C>    <C>
<C>     <C>
 Class A (with or without redemption)     $475    $633
$805   $1,305

 Class B (redemption at end of period)    $581    $709
$808   $1,410

 Class B (no redemption)                  $131    $409
$708   $1,410

 Class L (redemption at end of period)    $334    $517
$821   $1,685

 Class L (no redemption)                  $234    $517
$821   $1,685

 Class Y (with or without redemption)     $ 62    $195
$340   $  762
</TABLE>



Smith Barney New Jersey Municipals Fund Inc.

6

<PAGE>


  More on the fund's investments

New Jersey municipal securities New Jersey municipal
securities include debt
obligations issued by certain non-New Jersey
governmental issuers such as
Puerto Rico, the Virgin Islands and Guam. The interest
on New Jersey municipal
securities is exempt from regular federal income tax
and New Jersey personal
income tax. As a result, the interest rate on these
bonds normally is lower
than it would be if the bonds were subject to such
taxation. The New Jersey
municipal securities in which the fund invests include
general obligation
bonds, revenue bonds and municipal leases. The fund
may also invest up to 35%
of its net assets in municipal securities of non-New
Jersey issuers. These will
generally be exempt from federal, but not New Jersey,
income taxes.

Below investment grade securities Below investment
grade securities, also known
as "junk bonds", are considered speculative with
respect to the issuer's
ability to pay interest and principal, involve a high
risk of loss and are
susceptible to default or decline in market value
because of adverse economic
and business developments. The market value for these
securities tends to be
very volatile, and these securities are less liquid
than investment grade debt
securities.

Derivative contracts The fund may, but need not, use
derivative contracts, such
as financial futures and options on financial futures,
for any of the following
purposes:

 . To hedge against the economic impact of adverse
changes in the market value
  of portfolio securities because of changes in
interest rates
 . As a substitute for buying or selling securities


A futures contract will obligate or entitle the fund
to deliver or receive an
asset or cash payment based on the change in value of
one or more securities.
Even a small investment in futures can have a big
impact on a fund's interest
rate exposure. Therefore, using futures can
disproportionately increase losses
and reduce opportunities for gains when interest rates
are changing. The fund
may not fully benefit from or may lose money on
futures if changes in their
value do not correspond as anticipated to changes in
the value of the fund's
holdings. The other parties to certain futures present
the same types of
default risk as issuers of fixed income securities.
Futures can also make a
fund less liquid and harder to value, especially in
declining markets.


Defensive investing The fund may depart from its
principal investment
strategies in response to adverse market, economic or
political conditions by
taking temporary defensive positions in all types of
money market and
short-term debt securities. If the fund takes a
temporary defensive position,
it may be unable to achieve its investment goal.


7



Smith Barney Mutual Funds

<PAGE>

  Management


Manager The fund's investment adviser and
administrator is Smith Barney Fund
Management LLC ("SBFM") (formerly known as SSB Citi
Fund Management LLC), an
affiliate of Salomon Smith Barney Inc. The manager's
address is 7 World Trade
Center, New York, New York 10048. The manager selects
the fund's investments
and oversees its operations. The manager and Salomon
Smith Barney are
subsidiaries of Citigroup Inc.Citigroup businesses
produce a broad range of
financial services--asset management, banking and
consumer finance, credit and
charge cards, insurance, investments, investment
banking and trading--and use
diverse channels to make them available to consumer
and corporate customers
around the world.





Joseph P. Deane, investment officer of the manager and
managing director of
Salomon Smith Barney, has been responsible for the
day-to-day management of the
fund since February 1999. Mr. Deane has 31 years of
securities business
experience.



Management fees During the fiscal year ended March 31,
2001, the manager
received an advisory fee and an administrative fee
equal to 0.30% and 0.20%,
respectively, of the fund's average daily net assets.




Distribution plan The fund has adopted a Rule 12b-1
distribution plan for its
Class A, B and L shares. Under the plan, the fund pays
distribution and/or
service fees. These fees are an ongoing expense and,
over time, may cost you
more than other types of sales charges.


In addition, the distributor may make payments for
distribution and/or
shareholder servicing activities out of its past
profits and other available
sources. The distributor may also make payments for
marketing, promotional or
related expenses to dealers. The amount of these
payments is determined by the
distributor and may be substantial. The manager or an
affiliate may make
similar payments under similar arrangements.



Transfer agent and shareholder servicing agent Citi
Fiduciary Trust Company
serves as the fund's transfer agent and shareholder
servicing agent (the
"transfer agent"). The transfer agent has entered into
a sub-transfer agency
and services agreement with PFPC Global Fund Services
to serve as the fund's
sub-transfer agent (the "sub-transfer agent"). The
sub-transfer agent will
perform certain functions including shareholder record
keeping and accounting
services.



Smith Barney New Jersey Municipals Fund Inc.

8

<PAGE>


  Choosing a class of shares to buy

You can choose among four classes of shares: Classes
A, B, L and Y. Each class
has different sales charges and expenses, allowing you
to choose the class that
best meets your needs. Which class is more beneficial
to an investor depends on
the amount and intended length of the investment.

 . If you plan to invest regularly or in large amounts,
buying Class A shares
  may help you reduce sales charges and ongoing
expenses.
 . For Class B shares, all of your purchase amount and,
for Class L shares, more
  of your purchase amount (compared to Class A shares)
will be immediately
  invested. This may help offset the higher expenses
of Class B and Class L
  shares, but only if the fund performs well.
 . Class L shares have a shorter deferred sales charge
period than Class B
  shares. However, because Class B shares convert to
Class A shares, and Class
  L shares do not, Class B shares may be more
attractive to long-term
  investors.

You may buy shares from:

 . A broker/dealer, financial intermediary, financial
institution or a
  distributor's financial consultants (each called a
"Service Agent").


 . The fund, but only if you are investing through
certain Service Agents.


All classes of shares are not available through all
Service Agents. You should
contact your Service Agent for further information.



Investment minimums Minimum initial and additional
investment amounts vary
depending on the class of shares you buy and the
nature of your investment
account.

<TABLE>
<CAPTION>

Initial           Additional
                                       Classes A, B, L
Class Y   All Classes
  General                                  $1,000
$15 million     $50

 <S>                                   <C>
<C>         <C>
  Monthly Systematic Investment Plans        $25
n/a         $25

  Monthly Systematic Investment Plans        $50
n/a         $50

  Uniform Gift to Minor Accounts            $250
$15 million     $50

</TABLE>


9



Smith Barney Mutual Funds

<PAGE>

  Comparing the fund's classes


Your Service Agent can help you decide which class
meets your goals. Your
Service Agent may receive different compensation
depending upon which class you
choose.


<TABLE>
<CAPTION>
                        Class A            Class B
Class L           Class Y

<S>                <C>                <C>
<C>               <C>
 Key features      .Initial sales     .No initial
sales .Initial sales    .No initial or
                    charge             charge
charge is lower   deferred sales
                   .You may qual-     .Deferred sales
than Class A      charge
                    ify for reduc-     charge de-
 .Deferred sales   .Must invest at
                    tion or waiver     clines over
charge for only   least $15 mil-
                    of initial sales   time
1 year            lion
                    charge            .Converts to
 .Does not con-    .Lower annual
                   .Lower annual       Class A after 8
vert to Class A   expenses than
                    expenses than      years
 .Higher annual     the other
                    Class B and       .Higher annual
expenses than     classes
                    Class L            expenses than
Class A
                                       Class A

------------------------------------------------------
--------------------------------------
 Initial sales     Up to 4.00%;       None
1.00%             None
 charge            reduced for large
                   purchases and
                   waived for certain
                   investors. No
                   charge for
                   purchases of
                   $500,000 or more

------------------------------------------------------
--------------------------------------
 Deferred sales    1.00% on           Up to 4.50%
1.00% if you      None
 charge            purchases of       charged when you
redeem within 1
                   $500,000 or more   redeem shares.
year of purchase
                   if you redeem      The charge is
                   within 1 year of   reduced over
time
                   purchase           and there is no
                                      deferred sales
                                      charge after 6
                                      years

------------------------------------------------------
--------------------------------------
 Annual            0.15% of average   0.65% of average
0.70% of average  None
 distribution and  daily net assets   daily net assets
daily net assets
 service fees

------------------------------------------------------
--------------------------------------
 Exchange          Class A shares of  Class B shares
of Class L shares of Class Y shares of
 privilege*        most Smith Barney  most Smith
Barney most Smith Barney most Smith
                   funds              funds
funds             Barney funds

------------------------------------------------------
--------------------------------------
</TABLE>


* Ask your Service Agent for the Smith Barney funds
available for exchange.



Smith Barney New Jersey Municipals Fund Inc.

10

<PAGE>

  Sales charges

Class A shares
You buy Class A shares at the offering price, which is
the net asset value plus
a sales charge. You pay a lower sales charge as the
size of your investment
increases to certain levels called breakpoints. You do
not pay a sales charge
on the fund's distributions or dividends you reinvest
in additional Class A
shares.

The table below shows the rate of sales charge you
pay, depending on the amount
you purchase. The table below also shows the amount of
broker/dealer
compensation that is paid out of the sales charge.
This compensation includes
commissions and other fees which Service Agents that
sell shares of the fund
receive. The distributor keeps up to approximately 10%
of the sales charge
imposed on Class A shares. Service Agents also will
receive the service fee
payable on Class A shares at an annual rate equal to
0.15% of the average daily
net assets represented by the Class A shares serviced
by them.


<TABLE>
<CAPTION>

Broker/Dealer
                                Offering   Net amount
Commissions
Amount of purchase              price (%) invested (%)
as % of
<S>                             <C>       <C>
<C>

Less than $25,000                 4.00        4.17
3.60

$25,000 but less than $50,000     3.50        3.63
3.15

$50,000 but less than $100,000    3.00        3.09
2.70

$100,000 but less than $250,000   2.50        2.56
2.25

$250,000 but less than $500,000   1.50        1.52
1.35

$500,000 or more                   -0-         -0-
-0-

</TABLE>





Investments of $500,000 or more You do not pay an
initial sales charge when you
buy $500,000 or more of Class A shares. However, if
you redeem these Class A
shares within one year of purchase, you will pay a
deferred sales charge of 1%.


Qualifying for a reduced Class A sales charge There
are several ways you can
combine multiple purchases of Class A shares of Smith
Barney funds to take
advantage of the breakpoints in the sales charge
schedule.



Smith Barney Mutual Funds


11

<PAGE>

Accumulation privilege - lets you combine the current
value of Class A shares
owned

 . by you, or
 . by members of your immediate family,

and for which a sales charge was paid, with the amount
of your next purchase of
Class A shares for purposes of calculating the initial
sales charge. Certain
trustees and fiduciaries may be entitled to combine
accounts in determining
their sales charge.

Letter of intent - lets you purchase Class A shares of
the fund and other Smith
Barney funds over a 13-month period and pay the same
sales charge, if any, as
if all shares had been purchased at once. You may
include purchases on which
you paid a sales charge within 90 days before you sign
the letter.

Waivers for certain Class A investors Class A initial
sales charges are waived
for certain types of investors, including:


 . Employees of NASD members


 . Investors participating in a fee-based program
sponsored by certain
  broker-dealers affiliated with Citigroup


 . Investors who redeemed Class A shares of a Smith
Barney fund in the past 60
  days, if the investor's Service Agent is notified



If you want to learn about additional waivers of Class
A initial sales charges,
contact your Service Agent or consult the Statement of
Additional Information
("SAI").


Class B shares
You buy Class B shares at net asset value without
paying an initial sales
charge. However, if you redeem your Class B shares
within six years of
purchase, you will pay a deferred sales charge. The
deferred sales charge
decreases as the number of years since your purchase
increases.

           Year after purchase   1st  2nd 3rd 4th 5th
6th through 8th

           Deferred sales charge 4.5%  4%  3%  2%  1%
0%



Service Agents selling Class B shares receive a
commission of up to 4.00% of
the purchase price of the Class B shares they sell.
Service Agents also receive
a service fee at an annual rate equal to 0.15% of the
average daily net assets
represented by the Class B shares they are servicing.



Smith Barney New Jersey Municipals Fund Inc.

12

<PAGE>


Class B conversion After 8 years, Class B shares
automatically convert into
Class A shares. This helps you because Class A shares
have lower annual
expenses. Your Class B shares will convert to Class A
shares as follows:



<TABLE>
<CAPTION>
   Shares issued:             Shares issued:
Shares issued:
   At initial                 On reinvestment of
Upon exchange from
   purchase                   dividends and
another Smith Barney
                              distributions
fund

   <S>                        <C>
<C>
   Eight years after the date In same proportion as
On the date the
   of purchase                the number of
shares originally
                              Class B shares
converting  acquired would have
                              is to total Class B
shares converted into Class
                              you own (excluding
A shares
                              shares issued as a
                              dividend)

</TABLE>

Class L shares

You buy Class L shares at the offering price, which is
the net asset value plus
a sales charge of 1% (1.01% of the net amount
invested). In addition, if you
redeem your Class L shares within one year of
purchase, you will pay a deferred
sales charge of 1%. If you held Class C shares of the
fund and/or other Smith
Barney mutual funds on June 12, 1998, you will not pay
an initial sales charge
on Class L shares you buy before June 22, 2002.



Service Agents selling Class L shares receive
commissions of up to 1.75% of the
purchase price of the Class L shares they sell.
Starting in the thirteenth
month Service Agents also receive an annual fee of
0.70% of the average daily
net assets represented by the Class L Shares serviced
by them.


Class Y shares
You buy Class Y shares at net asset value with no
initial sales charge and no
deferred sales charge when you redeem. You must meet
the $15,000,000 initial
investment requirement. You can use a letter of intent
to meet this requirement
by buying Class Y shares of the fund over a 13-month
period. To qualify, you
must initially invest $5,000,000.



  More about deferred sales charges

The deferred sales charge is based on the net asset
value at the time of
purchase or redemption, whichever is less, and
therefore you do not pay a sales
charge on amounts representing appreciation or
depreciation.


13



Smith Barney Mutual Funds

<PAGE>



In addition, you do not pay a deferred sales charge
on:

 . Shares exchanged for shares of another Smith Barney
fund
 . Shares representing reinvested distributions and
dividends
 . Shares no longer subject to the deferred sales
charge

Each time you place a request to redeem shares, the
fund will first redeem any
shares in your account that are not subject to a
deferred sales charge and then
the shares in your account that have been held the
longest.


If you redeemed shares of a Smith Barney fund in the
past 60 days and paid a
deferred sales charge, you may buy shares of the fund
at the current net asset
value and be credited with the amount of the deferred
sales charge, if you
notify your Service Agent.



The fund's distributor receives deferred sales charges
as partial compensation
for its expenses in selling shares, including the
payment of compensation to
your Service Agent.


Deferred sales charge waivers
The deferred sales charge for each share class will
generally be waived:

 . On payments made through certain systematic
withdrawal plans
 . For involuntary redemptions of small account
balances
 . For 12 months following the death or disability of a
shareholder


If you want to learn more about additional waivers of
deferred sales charges,
contact your Service Agent or consult the SAI.


  Buying shares


<TABLE>
<C>               <S>
Through a Service You should contact your Service
Agent to open a
            Agent brokerage account and make
arrangements to buy
                  shares.

                  If you do not provide the following
information, your
                  order will be rejected:

                  .Class of shares being bought
                  .Dollar amount or number of shares
being bought

                  Your Service Agent may charge an
annual account
                  maintenance fee.

</TABLE>


14


Smith Barney New Jersey Municipals Fund Inc.

<PAGE>



<TABLE>
<C>                    <S>
      Through the fund Certain investors who are
clients of certain Service
                       Agents are eligible to buy
shares directly from the fund.

                       .Write the fund at the
following address:
                           Smith Barney New Jersey
Municipals Fund Inc.
                           (Specify class of shares)
                           c/o PFPC Global Fund
Services
                           P.O. Box 9699
                           Providence, RI 02940-9699
                       .Enclose a check to pay for the
shares. For initial
                        purchases, complete and send
an account applica-
                        tion.
                       .For more information, please
call the transfer agent
                        at 1-800-451-2010.

------------------------------------------------------
---------------------------
             Through a You may authorize your Service
Agent or the sub-
            systematic transfer agent to transfer
funds automatically from(i) a
       investment plan regular bank account, (ii) cash
held in a brokerage
                       account opened with a Service
Agent or (iii) certain
                       money market funds, in order to
buy shares on a
                       regular basis.

                       .Amounts transferred should be
at least: $25 monthly
                        or $50 quarterly
                       .If you do not have sufficient
funds in your account
                        on a transfer date, your
Service Agent or the sub-
                        transfer agent may charge you
a fee

                       For more information, contact
your Service Agent or the
                       transfer agent or consult the
SAI.

</TABLE>


  Exchanging shares


<TABLE>
  <C>                  <S>
          Smith Barney You should contact your Service
Agent to exchange
  offers a distinctive into other Smith Barney funds.
Be sure to read the
       family of funds prospectus of the Smith Barney
fund you are
      tailored to help exchanging into. An exchange is
a taxable transaction.
      meet the varying
   needs of both large .You may exchange shares only
for shares of the
             and small  same class of another Smith
Barney fund. Not all
             investors  Smith Barney funds offer all
classes.
                       .Not all Smith Barney funds may
be offered in your
                        state of residence. Contact
your Service Agent or the
                        transfer agent for further
information.
</TABLE>



15



Smith Barney Mutual Funds

<PAGE>



<TABLE>
  <C>              <S>
                   .Exchanges of Class A, Class B and
Class L shares are
                    subject to minimum investment
requirements
                    (except for systematic investment
plan exchanges),
                    and all shares are subject to the
other requirements
                    of the fund into which exchanges
are made.
                   .If you hold share certificates,
the sub-transfer agent
                    must receive the certificates
endorsed for transfer or
                    with signed stock powers
(documents transferring
                    ownership of certificates) before
the exchange is
                    effective.
                   .The fund may suspend or terminate
your exchange
                    privilege if you engage in an
excessive pattern of
                    exchanges.

  ----------------------------------------------------
------------------------
         Waiver of Your shares will not be subject to
an initial sales charge
  additional sales at the time of the exchange.
           charges
                   Your deferred sales charge (if any)
will continue to be
                   measured from the date of your
original purchase. If
                   the fund you exchange into has a
higher deferred sales
                   charge, you will be subject to that
charge. If you
                   exchange at any time into a fund
with a lower charge,
                   the sales charge will not be
reduced.

  ----------------------------------------------------
------------------------
      By telephone If you do not have a brokerage
account with a Service
                   Agent, you may be eligible to
exchange shares through
                   the fund. You must complete an
authorization form to
                   authorize telephone transfers. If
eligible, you may
                   make telephone exchanges on any day
the New York
                   Stock Exchange is open. Call the
transfer agent at 1-
                   800-451-2010 between 9:00 a.m. and
4:00 p.m. (Eastern
                   time).

                   You can make telephone exchanges
only between
                   accounts that have identical
registrations.

  ----------------------------------------------------
------------------------
           By mail If you do not have a brokerage
account, contact your
                   Service Agent or write to the sub-
transfer agent at the
                   address on the following page.
</TABLE>


16


Smith Barney New Jersey Municipals Fund Inc.

<PAGE>

  Redeeming shares


<TABLE>
<C>       <S>
Generally Contact your Service Agent to redeem shares
of the
          fund.

          If you hold share certificates, the sub-
transfer agent
          must receive the certificates endorsed for
transfer or
          with signed stock powers before the
redemption is
          effective.

          If the shares are held by a fiduciary or
corporation,
          other documents may be required.

          Your redemption proceeds will be sent within
three
          business days after your request is received
in good
          order. However, if you recently purchased
your shares
          by check, your redemption proceeds will not
be sent to
          you until your original check clears, which
may take up
          to 15 days.

          If you have a brokerage account with a
Service Agent,
          your redemption proceeds will be placed in
your
          account and not reinvested without your
specific
          instruction. In other cases, unless you
direct otherwise,
          your redemption proceeds will be paid by
check mailed
          to your address of record.

------------------------------------------------------
--------------
  By mail For accounts held directly at the fund, send
written
          requests to the fund at the following
address:
              Smith Barney New Jersey Municipals Fund
Inc.
              (Specify class of shares)
              c/o PFPC Global Fund Services
              P.O. Box 9699
              Providence, RI 02940-9699

          Your written request must provide the
following:

          .The fund name and account number
          .The class of shares and the dollar amount
or num-
           ber of shares to be redeemed
          .Signatures of each owner exactly as the
account is
           registered
</TABLE>




Smith Barney Mutual Funds


17

<PAGE>



<TABLE>
<C>              <S>
    By telephone If you do not have a brokerage
account with a Service
                 Agent, you may be eligible to redeem
shares in
                 amounts up to $50,000 per day through
the fund. You
                 must complete an authorization form
to authorize
                 telephone redemptions. If eligible,
you may request
                 redemptions by telephone on any day
the New York
                 Stock Exchange is open. Call the
transfer agent at 1-
                 800-451-2010 between 9:00 a.m. and
4:00 p.m. (Eastern
                 time).

                 Your redemption proceeds can be sent
by check to
                 your address of record or by wire or
electronic transfer
                 (ACH) to a bank account designated on
your
                 authorization form. You must submit a
new
                 authorization form to change the bank
account
                 designated to receive wire or
electronic transfers and
                 you may be asked to provide certain
other documents.
                 The sub-transfer agent may charge a
fee on a wire or
                 electronic transfer (ACH).

------------------------------------------------------
---------------------------
  Automatic cash You can arrange for the automatic
redemption of a
withdrawal plans portion of your shares on a monthly
or quarterly basis.
                 To qualify you must own shares of the
fund with a value
                 of at least $10,000 and each
automatic redemption
                 must be at least $50. If your shares
are subject to a
                 deferred sales charge, the sales
charge will be waived if
                 your automatic payments do not exceed
1% per month
                 of the value of your shares subject
to a deferred sales
                 charge.

                 The following conditions apply:

                 . Your shares must not be represented
by certificates
                 . All dividends and distributions
must be reinvested

                 For more information, contact your
Service Agent or consult the
                 SAI.
</TABLE>


18


Smith Barney New Jersey Municipals Fund Inc.

<PAGE>


  Other things to know about share transactions

When you buy, exchange or redeem shares, your request
must be in good order.
This means you have provided the following
information, without which your
request will not be processed:

 . Name of the fund
 . Account number
 . Class of shares being bought, exchanged or redeemed
 . Dollar amount or number of shares being bought,
exchanged or redeemed
 . Signature of each owner exactly as the account is
registered


The fund will employ reasonable procedures to confirm
that any telephone
exchange or redemption request is genuine, including
recording calls, asking
the caller to provide certain personal identification
information, sending you
a written confirmation or requiring other confirmation
procedures from time to
time. If these procedures are employed, neither the
fund nor the transfer agent
will bear any liability for such transactions.


Signature guarantees To be in good order, your
redemption request must include
a signature guarantee if you:


 . Are redeeming over $50,000

 . Are sending signed share certificates or stock
powers to the sub-transfer
  agent
 . Instruct the sub-transfer agent to mail the check to
an address different
  from the one on your account
 . Changed your account registration
 . Want the check paid to someone other than the
account owner(s)
 . Are transferring the redemption proceeds to an
account with a different
  registration

You can obtain a signature guarantee from most banks,
dealers, brokers, credit
unions and federal savings and loan institutions, but
not from a notary public.

The fund has the right to:

 . Suspend the offering of shares
 . Waive or change minimum and additional investment
amounts
 . Reject any purchase or exchange order
 . Change, revoke or suspend the exchange privilege
 . Suspend telephone transactions


19



Smith Barney Mutual Funds

<PAGE>


 . Suspend or postpone redemptions of shares on any day
when trading on the New
  York Stock Exchange is restricted, or as otherwise
permitted by the
  Securities and Exchange Commission
 . Pay redemption proceeds by giving you securities.
You may pay transaction
  costs to dispose of the securities


Small account balances If your account falls below
$500 because of a redemption
of fund shares, the fund may ask you to bring your
account up to the minimum
investment amount. If you choose not to do so within
60 days, the fund may
close your account and send you the redemption
proceeds.


Excessive exchange transactions The manager may
determine that a pattern of
frequent exchanges is detrimental to the fund's
performance and other
shareholders. If so, the fund may limit additional
purchases and/or exchanges
by a shareholder.

Share certificates The fund does not issue share
certificates unless a written
request signed by all registered owners is made to the
sub-transfer agent. If
you hold share certificates it will take longer to
exchange or redeem shares.

20


Smith Barney New Jersey Municipals Fund Inc.

<PAGE>


  Dividends, distributions and taxes


Dividends The fund pays dividends each month from its
net investment income.
The fund generally makes capital gain distributions,
if any, once a year,
typically in December. The fund may pay additional
distributions and dividends
at other times if necessary for the fund to avoid a
federal tax. Capital gain
distributions and dividends are reinvested in
additional fund shares of the
same class you hold. The fund expects distributions to
be primarily from
income. You do not pay a sales charge on reinvested
distributions or dividends.
Alternatively, you can instruct your Service Agent,
the transfer agent or the
sub-transfer agent to have your distributions and/or
dividends paid in cash.
You can change your choice at any time to be effective
as of the next
distribution or dividend, except that any change given
to the Service Agent,
transfer agent or the sub-transfer agent less than
five days before the payment
date will not be effective until the next distribution
or dividend is paid.


Taxes In general, redeeming shares, exchanging shares
and receiving
distributions (whether in cash or additional shares)
are all taxable events.


<TABLE>
<CAPTION>
                                                New
Jersey personal
 Transaction         Federal tax status         income
tax status

<S>                  <C>                        <C>
 Redemption or       Usually capital gain or
Usually capital gain or
 exchange of shares  loss; long-term only if    loss
                     shares owned more than
                     one year

 Long-term capital   Long-term capital gain     Long-
term capital gain
 gain distributions

 Short-term capital  Ordinary income
Ordinary income
 gain distributions

 Dividends           Exempt from regular        Exempt
if from interest
                     federal income tax if from on New
Jersey municipal
                     interest on tax-exempt
securities, otherwise
                     securities, otherwise
ordinary income
                     ordinary income

</TABLE>


Any taxable dividends and capital gain distributions
are taxable whether
received in cash or reinvested in fund shares. Long-
term capital gain
distributions are taxable to you as long-term capital
gain regardless of how
long you have owned your shares. You may want to avoid
buying shares when the
fund is about to declare a capital gain distribution
or a taxable dividend,
because it will be taxable to you even though it may
actually be a return of a
portion of your investment.

After the end of each year, the fund will provide you
with information about
the distributions and dividends you received and any
redemptions of


21



Smith Barney Mutual Funds

<PAGE>



shares during the previous year. If you do not provide
the fund with your
correct taxpayer identification number and any
required certifications, you may
be subject to back-up withholding of your
distributions, dividends, and
redemption proceeds. Because each shareholder's
circumstances are different and
special tax rules may apply, you should consult your
tax adviser about your
investment in the fund.


  Share price


You may buy, exchange or redeem shares at their net
asset value, plus any
applicable sales charge, next determined after receipt
of your request in good
order. The fund's net asset value is the value of its
assets minus its
liabilities. Net asset value is calculated separately
for each class of shares.
The fund calculates its net asset value every day the
New York Stock Exchange
is open. This calculation is done when regular trading
closes on the Exchange
(normally 4:00 p.m., Eastern time). The Exchange is
closed on certain holidays
listed in the SAI.


Generally, the fund's investments are valued by an
independent pricing service.
If market quotations or a valuation from the pricing
service is not readily
available for a security or if a security's value has
been materially affected
by events occurring after the close of the Exchange or
market on which the
security is principally traded, that security may be
valued by another method
that the fund's board believes accurately reflects
fair value. A fund that uses
fair value to price securities may value those
securities higher or lower than
another fund using market quotations to price the same
securities. A security's
valuation may differ depending on the method used for
determining value.


In order to buy, redeem or exchange shares at that
day's price, you must place
your order with your Service Agent or the fund's sub-
transfer agent before the
New York Stock Exchange closes. If the Exchange closes
early, you must place
your order prior to the actual closing time.
Otherwise, you will receive the
next business day's price.



Service Agents must transmit all orders to buy,
exchange or redeem shares to
the fund's sub-transfer agent before the sub-transfer
agent's close of
business.


22


Smith Barney New Jersey Municipals Fund Inc.

<PAGE>



  Financial highlights


The financial highlights tables are intended to help
you understand the
performance of each class for the past 5 years.
Certain information reflects
financial results for a single share. Total return
represents the rate that a
shareholder would have earned (or lost) on a fund
share assuming reinvestment
of all dividends and distributions. The information in
the following tables was
audited by KPMG LLP, independent accountants, whose
report, along with the
fund's financial statements, is included in the annual
report (available upon
request). No information is presented for Class Y
shares because no Class Y
shares were outstanding during these fiscal years.


  For a Class A share of capital stock outstanding
throughout each year ended
  March 31:
<TABLE>
<CAPTION>

                                          2001/(1)/
2000/(1)/ 1999/(1)/  1998    1997

------------------------------------------------------
----------------------------------
<S>                                       <C>
<C>       <C>       <C>     <C>
 Net asset value, beginning of year        $11.96
$13.26     $13.44   $12.92  $12.88

------------------------------------------------------
----------------------------------
 Income (loss) from operations:
 Net investment income                       0.65
0.65       0.66     0.70    0.70
 Net realized and unrealized gain (loss)     0.50
(1.21)      0.05     0.59    0.02

------------------------------------------------------
----------------------------------
 Total income (loss) from operations         1.15
(0.56)      0.71     1.29    0.72

------------------------------------------------------
----------------------------------
 Less distributions from:
 Net investment income                      (0.66)
(0.64)     (0.66)   (0.71)  (0.68)
 Net realized gains                            --
(0.10)     (0.23)   (0.06)     --

------------------------------------------------------
----------------------------------
 Total distributions                        (0.66)
(0.74)     (0.89)   (0.77)  (0.68)

------------------------------------------------------
----------------------------------
 Net asset value, end of year              $12.45
$11.96     $13.26   $13.44  $12.92

------------------------------------------------------
----------------------------------
 Total return                                9.92%
(4.28)%     5.41%   10.20%   5.74%

------------------------------------------------------
----------------------------------
 Net assets, end of year (millions)          $152
$136       $170     $158    $148

------------------------------------------------------
----------------------------------
 Ratios to average net assets:
 Expenses                                    0.76%
0.74%      0.75%    0.75%   0.76%
 Net investment income                       5.34
5.26       4.89     5.22    5.44

------------------------------------------------------
----------------------------------
 Portfolio turnover rate                       18%
21%        52%      55%     36%

------------------------------------------------------
----------------------------------
</TABLE>
/(1)/Per share amounts have been calculated using the
monthly average shares
   method.



Smith Barney Mutual Funds


23

<PAGE>


  For a Class B share of capital stock outstanding
throughout each year ended
  March 31:
<TABLE>
<S>                                      <C>       <C>
<C>       <C>      <C>
<CAPTION>
                                         2001/(1)/
2000/(1)/  1999/(1)/   1998     1997

------------------------------------------------------
------------------------------------
<S>                                      <C>       <C>
<C>       <C>      <C>
Net asset value, beginning of year        $11.95
$13.25    $13.44    $12.92   $12.88

------------------------------------------------------
------------------------------------
Income (loss) from operations:
 Net investment income                      0.58
0.59      0.59      0.63     0.64
 Net realized and unrealized gain (loss)    0.51
(1.22)     0.04      0.59     0.02

------------------------------------------------------
------------------------------------
Total income (loss) from operations         1.09
(0.63)     0.63      1.22     0.66

------------------------------------------------------
------------------------------------
Less distributions from:
 Net investment income                     (0.59)
(0.57)     (0.59)    (0.64)   (0.62)
 Net realized gains                           --
(0.10)    (0.23)    (0.06)      --

------------------------------------------------------
------------------------------------
Total distributions                        (0.59)
(0.67)    (0.82)    (0.70)   (0.62)

------------------------------------------------------
------------------------------------
Net asset value, end of year              $12.45
$11.95    $13.25    $13.44   $12.92

------------------------------------------------------
------------------------------------
Total return                                9.38%
(4.82)%    4.80%     9.66%    5.23%

------------------------------------------------------
------------------------------------
Net assets, end of year (000s)           $50,491
$55,108   $69,350   $65,773  $62,249

------------------------------------------------------
------------------------------------
Ratios to average net assets:
 Expenses                                   1.29%
1.26%      1.28%     1.27%    1.28%
 Net investment income                      4.82
4.74      4.37      4.70     4.92

------------------------------------------------------
------------------------------------
Portfolio turnover rate                       18%
21%       52%       55%      36%

------------------------------------------------------
------------------------------------
</TABLE>
/(1)/Per share amounts have been calculated using the
monthly average shares
   method.

24


Smith Barney New Jersey Municipals Fund Inc.

<PAGE>


  For a Class L share/(1)/ of capital stock
outstanding throughout each year
  ended March 31:

<TABLE>
<S>                                       <C>
<C>       <C>          <C>     <C>
<CAPTION>
                                          2001/(1)/
2000/(1)/ 1999/(1)(2)/  1998    1997
<S>                                       <C>
<C>       <C>          <C>     <C>
------------------------------------------------------
-------------------------------------
 Net asset value, beginning of year       $ 11.95
$13.25        $13.43   $12.92  $12.88
------------------------------------------------------
-------------------------------------
 Income (loss) from operations:
 Net investment income                       0.57
0.59          0.58     0.61    0.63
 Net realized and unrealized gain (loss)     0.50
(1.23)         0.05     0.59    0.02
------------------------------------------------------
-------------------------------------
 Total income (loss) from operations         1.07
(0.64)         0.63     1.20    0.65
------------------------------------------------------
-------------------------------------
 Less distributions from:
 Net investment income                      (0.58)
(0.56)        (0.58)   (0.63)  (0.61)
 Net realized gains                            --
(0.10)        (0.23)   (0.06)     --
------------------------------------------------------
-------------------------------------
 Total distributions                        (0.58)
(0.66)        (0.81)   (0.69)  (0.61)
------------------------------------------------------
-------------------------------------
 Net asset value, end of year             $ 12.44
$11.95        $13.25   $13.43  $12.92
------------------------------------------------------
-------------------------------------
 Total return                                9.24%
(4.86)%        4.78%    9.50%   5.17%
------------------------------------------------------
-------------------------------------
 Net assets, end of year (000s)           $13,038
$8,544        $9,093   $6,153  $4,861
------------------------------------------------------
-------------------------------------
 Ratios to average net assets:
 Expenses                                    1.33%
1.32%         1.32%    1.39%   1.32%
 Net investment income                       4.76
4.70          4.32     4.58    4.88
------------------------------------------------------
-------------------------------------
 Portfolio turnover rate                       18%
21%           52%      55%     36%
------------------------------------------------------
-------------------------------------
</TABLE>


/(1)/Per share amounts have been calculated using the
monthly average shares
   method.


/(2)/On June 12, 1998, Class C shares were renamed
Class L shares



25



Smith Barney Mutual Funds

<PAGE>

[LOGO] Smith Barney
       Mutual Funds
Your Serious Money. Professionally Managed./SM/

Smith Barney New Jersey Municipals Fund Inc.

Shareholder reports Annual and semiannual reports to
shareholders provide
additional information about the fund's investments.
These reports discuss the
market conditions and investment strategies that
significantly affected the
fund's performance during its last fiscal year end or
period.


The fund sends only one report to a household if more
than one account has the
same address. Contact your Service Agent or the
transfer agent if you do not
want this policy to apply to you.



Statement of additional information The statement of
additional information
provides more detailed information about the fund. It
is incorporated by
reference into (is legally a part of) this prospectus.



You can make inquiries about the fund or obtain
shareholder reports or the
statement of additional information (without charge)
by contacting your Service
Agent, by calling the fund at 1-800-451-2010, or by
writing to the fund at
Smith Barney Mutual Funds, 7 World Trade Center, 39th
Floor, New York, New York
10048.






Information about the fund (including the SAI) can be
reviewed and copied at
the Commission's Public Reference Room in Washington,
D.C. In addition,
information on the operation of the Public Reference
Room may be obtained by
calling the Commission at 1-202-942-8090. Reports and
other information about
the Fund are available on the EDGAR Database on the
Commission's Internet site
at http://www.sec.gov. Copies of this information may
be obtained for a
duplicating fee by electronic request at the following
E-mail address:
publicinfo@sec.gov, or by writing the Commission's
Public Reference Section,
Washington, D.C. 20549-0102.



If someone makes a statement about the fund that is
not in this prospectus, you
should not rely upon that information. Neither the
fund nor the distributor are
offering to sell shares of the fund to any person to
whom the fund may not
lawfully sell its shares.



Your Serious Money. Professionally Managed./SM/ is a
service mark of Salomon
Smith Barney Inc.


(Investment Company Act
file no. 811-5406)
FD0231 7/01




PART B-Statement of Additional Information

July 30, 2001

STATEMENT OF ADDITIONAL INFORMATION

SMITH BARNEY NEW JERSEY MUNICIPALS FUND INC.

7 World Trade Center
New York, New York 10048
(800) 451-2010


This Statement of Additional Information ("SAI") is
not
a prospectus and is meant to be read in conjunction
with
the prospectus of the Smith Barney New Jersey
Municipals
Fund Inc. (the "fund") dated July 30, 2001, as amended
or supplemented from time to time (the "prospectus"),
and is incorporated by reference in its entirety into
the prospectus.  Additional information about the
fund's
investments is available in the fund's annual and
semi-
annual reports to shareholders that are incorporated
herein by reference.  The prospectus and copies of the
reports may be obtained free of charge by contacting a
Salomon Smith Barney Financial Consultant, a
broker/dealer, financial intermediary, or a financial
institution (each called a "Service Agent") or by
writing or calling the fund at the address or
telephone
number above.

TABLE OF CONTENTS

Directors and Executive Officers of the Fund	2
Investment Objective and Management Policies of the
Fund	5
Investment Restrictions	15
Risk Factors	17
Special Considerations Relating to New Jersey
Municipal
Securities	20
Special Considerations Regarding Puerto Rico,
the U.S. Virgin Islands and Guam	24
Portfolio Transactions	26
Portfolio Turnover	27
Purchase of Shares	27
Determination of Net Asset Value	33
Redemption of Shares	34
Investment Management and Other Services	37
Valuation of Shares	41
Exchange Privilege	42
Performance Data	43
Dividends, Distributions and Taxes	47
Additional Information	51
Financial Statements	52
Other Information	52
Appendix A	54



DIRECTORS AND EXECUTIVE OFFICERS OF THE FUND

The names of the directors of the fund and executive
officers of the fund, together with information as to
their principal business occupations, are set forth
below.  The executive officers of the fund are
employees
of organizations that provide services to the fund.
Each director who is an "interested person" of the
fund,
as defined in the Investment Company Act of 1940, as
amended (the "1940 Act"), is indicated by an asterisk.
 The address of the "non-interested" directors and
executive officers of the fund is 7 World Trade
Center,
New York, New York  10048, unless otherwise indicated.

Herbert Barg (Age 78).  Director
Private Investor. Director or trustee of 16 investment
companies associated with Citigroup Inc. ("Citigroup")
His address is 273 Montgomery Avenue, Bala Cynwyd,
Pennsylvania 19004.

*Alfred J. Bianchetti (Age 78).  Director
Retired; formerly Senior Consultant to Dean Witter
Reynolds Inc. Director or trustee of 11 investment
companies associated with Citigroup.  His address is
19
Circle End Drive, Ramsey, New Jersey 07466.

Martin Brody (Age 79).  Director
Consultant, HMK Associates; Retired Vice Chairman of
the
Board of Restaurant Associates Corp. Director or
trustee
of 20 investment companies associated with Citigroup.
His address is c/o HMK Associates, 30 Columbia
Turnpike,
Florham Park, New Jersey 07932.

Dwight B. Crane (Age 63).  Director
Professor, Harvard Business School. Director or
trustee
of 23 investment companies associated with Citigroup.
His address is c/o Harvard Business School, Soldiers
Field Road, Boston, Massachusetts 02163.

Burt N. Dorsett (Age 70).  Director
Managing Partner of Dorsett McCabe Management Inc., an
investment counseling firm; Director of Research
Corporation Technologies, Inc., a nonprofit patent
clearing and licensing firm. Director or trustee of 11
investment companies associated with Citigroup. His
address is 201 East 62nd Street, New York, New York
10021.

Elliot S. Jaffe (Age 75).  Director
Chairman of the Board and President of The Dress Barn,
Inc. Director or trustee of 11 investment companies
associated with Citigroup. His address is 30 Dunnigan
Drive, Suffern, New York 10901.

Stephen E. Kaufman (Age 69).  Director
Attorney. Director or trustee of 13 investment
companies
associated with Citigroup. His address is 277 Park
Avenue, New York, New York 10172.


Joseph J. McCann (Age 70).  Director
Financial Consultant; Retired Financial Executive,
Ryan
Homes, Inc. Director or trustee of 11 investment
companies associated with Citigroup. His address is
200
Oak Park Place, Pittsburgh, Pennsylvania 15243.

*Heath B. McLendon (Age 68).  Chairman of the Board
and
Investment Officer
Managing Director of Salomon Smith Barney Inc.
("Salomon
Smith Barney"); President of Smith Barney Fund
Management LLC ("SBFM" or the "manager"), (formerly
known as SSB Citi Fund Management LLC) and Travelers
Investment Adviser, Inc. ("TIA"); Chairman or Co-
Chairman of the Board and Director or trustee of 71
investment companies associated with Citigroup. His
address is 7 World Trade Center, New York, New York
10048.

Cornelius C. Rose, Jr. (Age 68). Director
President, Cornelius C. Rose Associates, Inc.,
financial
consultants, and Chairman and Director of Performance
Learning Systems, an educational consultant. Director
or
trustee of 11 investment companies associated with
Citigroup. His address is Meadowbrook Village,
Building
4, Apt 6, West Lebanon, New Hampshire 03784.

Lewis E. Daidone (Age 43).  Senior Vice President and
Treasurer
Managing Director of Salomon Smith Barney; Chief
Financial Officer of the Smith Barney Mutual funds;
Director and Senior Vice President of SBFM and TIA.
Senior Vice President or Executive Vice President and
Treasurer of 61 investment companies associated with
Citigroup.  His address is 125 Broad Street, New York,
New York 10004.

Joseph P. Deane (Age 53).  Vice President and
Investment
Officer
Investment Officer of SBFM; Managing Director of
Salomon
Smith Barney.  Investment officer of 9 Smith Barney
mutual funds.  His address is 7 World Trade Center,
New
York, New York 10048.

Paul Brook (Age 47). Controller
Director of Salomon Smith Barney; from 1997-1998
Managing Director of AMT Capital Services Inc.; prior
to
1997 Partner with Ernst & Young LLP. Controller or
Assistant Treasurer of 43 investment companies
associated with Citigroup.  His address is 125 Broad
Street, New York, New York 10004.

Christina T. Sydor (Age 50). Secretary
Managing Director of Salomon Smith Barney; General
Counsel and Secretary of SBFM and TIA. Secretary of 61
investment companies associated with Citigroup.  Her
address is 7 World Trade Center, New York, New York
10048.

As of July 9, 2001, the directors and officers of the
fund, as a group, owned less than 1% of the
outstanding
shares of beneficial interest of the fund.

To the best knowledge of the directors, as of July 9,
2001, no single shareholder or "group" (as such term
is
defined in Section 13(d) of the Securities Exchange
Act
of 1934, as amended) beneficially owned more than 5%
of
the outstanding shares of the fund.

No officer, director or employee of Salomon Smith
Barney
or any of its affiliates receives any compensation
from
the fund for serving as an officer of the fund or
director of the fund.  The fund pays each director who
is not an officer, director or employee of Salomon
Smith
Barney or any of its affiliates a fee of $1,000 per
annum plus $100 per in-person meeting and $100 per
telephonic meeting.  Each director emeritus who is not
an officer, director or employee of Salomon Smith
Barney
or its affiliates receives a fee of $500 per annum
plus
$50 per in-person meeting and $50 per telephonic
meeting.  All directors are reimbursed for travel and
out-of-pocket expenses incurred to attend such
meetings.
 For the fiscal year ended March 31, 2001, such
expenses
totaled $7,347.

For the fiscal year ended March 31, 2001, the
directors
of the fund were paid the following compensation:







Name of Person





Aggregate
Compensati
on
from Fund
Total
Pension or
Retirement
Benefits
Accrued
As part of
Fund
Expenses


Compensati
on
From Fund
And Fund
Complex
Paid to
Directors



Number of
Funds for
Which
Director
Serves
Within
Fund Complex

Herbert Barg **
$1,400
$0
$116,075
16
Alfred
Bianchetti *
 1,409
  0
   58,900
11
Martin Brody **
 1,200
  0
 132,950
20
Dwight B. Crane
**
 1,409
  0
 153,175
23
Burt N. Dorsett
**
1,409
  0
   59,500
11
Elliot S. Jaffe
**
 1,300
  0
  58,700
11
Stephen E.
Kaufman **
1,409
  0
114,400
13
Joseph J. McCann
**
1,409
  0
59,500
11
Heath B.
McLendon *
0
  0
0
71
Cornelius C.
Rose, Jr. **
 1,409
  0
59,500
11

*	Designates an "interested" director.
**	Designates member of Audit Committee.

Upon attainment of age 80, fund directors are required
to change to emeritus status. Directors emeritus
are entitled to serve in emeritus status for a
maximum of 10 years.  A director emeritus may attend
meetings but has no voting rights. During the
fund's last fiscal year, aggregate compensation
 paid by the fund to directors achieving emeritus
status
totaled $700.


INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES OF THE
FUND

The prospectus discusses the fund's investment
objective
and policies. The following discussion supplements the
description of the fund's investment policies in the
prospectus.  For purposes of this SAI, obligations of
non-New Jersey municipal issuers, the interest on
which
is at least exempt from federal income taxation
("Other
Municipal Securities"), and obligations of the State
of
New Jersey and its political subdivisions, agencies
and
public authorities (together with certain municipal
issuers such as the Commonwealth of Puerto Rico, the
Virgin Islands and Guam) that pay interest which is
excluded from gross income for federal income tax
purposes and exempt from New Jersey personal income
taxes ("New Jersey Municipal Securities") are
collectively referred to as "Municipal Bonds." SBFM
serves as investment manager and administrator to the
fund.

The fund operates subject to an investment policy
providing that, under normal market conditions, the
fund
will invest at least 80% of its net assets in
Municipal
Securities and at least 65% of the aggregate principal
amount of its investments in New Jersey Municipal
Securities.  Whenever less than 80% of the fund's
assets
are invested in New Jersey Municipal Securities, the
fund, in order to maintain its status as a "qualified
investment fund" under New Jersey law, will seek to
invest in debt obligations which, in the opinion of
counsel to the issuers, are free from state or local
taxation under New Jersey or federal laws ("Tax-Exempt
Obligations").  The fund's investments in New Jersey
Municipal Securities and Tax-Exempt Obligations will
represent at least 80% of the aggregate principal
amount
of all of its investments, excluding cash and cash
items
(including receivables). Subject to these minimum
investment requirements, the fund also may acquire
intermediate- and long-term debt obligations
consisting
of Other Municipal Securities, the interest on which
is
at least exempt from federal income taxation (not
including the possible applicability of the
alternative
minimum  tax).  When the manager believes that market
conditions warrant adoption of a temporary defensive
investment posture, the fund may invest without limit
in
Other Municipal Securities and in "Temporary
Investments" as described below.

Non-Diversified Classification

The fund is classified as a non-diversified fund under
the 1940 Act, which means the fund is not limited by
the
Act in the proportion of its assets it may invest in
the
obligations of a single issuer. The fund intends to
conduct its operations, however, so as to qualify as a
"regulated investment company" for purposes of the
Internal Revenue Code of 1986, as amended (the
"Code"),
which will relieve the fund of any liability for
federal
income tax and New Jersey franchise tax, as
applicable,
to the extent its earnings are distributed to
shareholders.  To qualify as a regulated investment
company, the fund will, among other things, limit its
investments so that, at the close of each quarter of
the
taxable year (a) not more than 25% of the market value
of the fund's total assets will be invested in the
securities of a single issuer and (b) with respect to
50% of the market value of its total assets, not more
than 5% of the market value of its total assets will
be
invested in the securities of a single issuer and the
fund will not own more than 10% of the outstanding
voting securities of a single issuer.

As a result of the fund's non-diversified status, an
investment in the fund may present greater risks to
investors than an investment in a diversified fund.
The
investment return on a non-diversified fund typically
is
dependent upon the performance of a smaller number of
securities relative to the number of securities held
in
a diversified fund.  The fund's assumption of large
positions in the obligations of a small number of
issuers will affect the value of its portfolio to a
greater extent than that of a diversified fund in the
event of changes in the financial condition, or in the
market's assessment, of the issuers.

The identification of the issuer of Tax-Exempt
Obligations generally depends upon the terms and
conditions of the security.  When the assets and
revenues of an agency, authority, instrumentality or
other political subdivision are separate from those of
the government creating the issuing entity and the
security is backed only by the assets and revenues of
such entity, such entity would be deemed to be the
sole
issuer.  Similarly, in the case of a private activity
bond, if that bond is backed only by the assets and
revenues of the nongovernmental user, then such
nongovernmental user is deemed to be the sole issuer.
 If in either case, however, the creating government
or
some other entity guarantees a security, such a
guarantee would be considered a separate security and
would be treated as an issue of such government or
other
entity.

Ratings as Investment Criteria.  In general, the
ratings
of Moody's Investors Service, Inc. ("Moody's"),
Standard
& Poor's Ratings Group ("S&P") and other nationally
recognized statistical ratings organizations
("NRSROs")
represent the opinions of those agencies as to the
quality of the Municipal Bonds and short-term
investments which they rate. It should be emphasized,
however, that such ratings are relative and
subjective,
are not absolute standards of quality and do not
evaluate the market risk of securities.  These ratings
will be used by the fund as initial criteria for the
selection of portfolio securities, but the fund also
will rely upon the independent advice of the manager
to
evaluate potential investments.  Among the factors
that
will be considered are the long-term ability of the
issuer to pay principal and interest, as well as
general
economic trends.  To the extent the fund invests in
lower-rated and comparable unrated securities, the
fund's achievement of its investment objective may be
more dependent on the manager's credit analysis of
such
securities than would be the case for a portfolio
consisting entirely of higher-rated securities.  The
Appendix contains information concerning the ratings
of
Moody's, S&P and other NRSROs and their significance.

Subsequent to its purchase by the fund, an issue of
Municipal Bonds may cease to be rated or its rating
may
be reduced below the rating given at the time the
securities were acquired by the fund. Neither event
will
require the sale of such Municipal Bonds by the fund,
but the manager will consider such event in its
determination of whether the fund should continue to
hold the Municipal Bonds. In addition, to the extent
that the ratings change as a result of changes in such
organizations or their rating systems or due to a
corporate restructuring of Moody's or S&P or other
NRSRO's, the fund will attempt to use comparable
ratings
as standards for its investments in accordance with
its
investment objective and policies.

The fund generally will invest at least 75% of its
total
assets in investment grade debt obligations rated no
lower than Baa, MIG 3 or Prime-1 by Moody's or BBB,
SP-2
or A-1 by S&P, or have the equivalent rating by any
other NRSRO or in unrated obligations of comparable
quality. Unrated obligations will be considered to be
of
investment grade if deemed by the manager to be
comparable in quality to instruments so rated, or if
other outstanding obligations of the issuers thereof
are
rated Baa or better by Moody's or BBB or better by
S&P.
 The balance of the fund's assets may be invested in
securities rated as low as C by Moody's or D by S&P or
have the equivalent rating by any other NRSRO, or
deemed
by the manager to be comparable unrated securities,
which are sometimes referred to as "junk bonds."
Securities in the fourth highest rating category,
though
considered to be investment grade, have speculative
characteristics.  Securities rated as low as D are
extremely speculative and are in actual default of
interest and/or principal payments.

Low and Comparable Unrated Securities.  While the
market
values of low-rated and comparable unrated securities
tend to react less to fluctuations in interest rate
levels than the market values of higher rated
securities, the market values of certain low-rated and
comparable unrated municipal securities also tend to
be
more sensitive than higher-rated securities to short-
term corporate and industry developments and changes
in
economic conditions (including recession) in specific
regions or localities or among specific types of
issuers.  In addition, low-rated securities and
comparable unrated securities generally present a
higher
degree of credit risk.  During an economic downturn or
a prolonged period of rising interest rates, the
ability
of issuers of low-rated and comparable unrated
securities to service their payment obligations, meet
projected goals or obtain additional financing may be
impaired.  The risk of loss due to default by such
issuers is significantly greater because low-rated and
comparable unrated securities generally are unsecured
and frequently are subordinated to the prior payment
of
senior indebtedness.  The fund may incur additional
expenses to the extent it is required to seek recovery
upon a default in payment of principal or interest on
its portfolio holdings.

While the market for municipal securities is
considered
to be generally adequate, the existence of limited
markets for particular low-rated and comparable
unrated
securities may diminish the fund's ability to (a)
obtain
accurate market quotations for purposes of valuing
such
securities and calculating its net asset value and (b)
sell the securities at fair value either to meet
redemption requests or to respond to changes in the
economy or in the financial markets.  The market for
certain low-rated and comparable unrated securities
has
not fully weathered a major economic recession. Any
such
recession, however, would likely disrupt severely the
market for such securities and adversely affect the
value of the securities and the ability of the issuers
of such securities to repay principal and pay interest
thereon.

Fixed-income securities, including low-rated
securities
and comparable unrated securities, frequently have
call
or buy-back features that permit their issuers to call
or repurchase the securities from their holders, such
as
the fund.  If an issuer exercises these rights during
periods of declining interest rates, the fund may have
to replace the security with a lower yielding
security,
thus resulting in a decreased return to the fund.

Because many issuers of New Jersey Municipal
Securities
may choose not to have their obligations rated, it is
possible that a large portion of the fund's portfolio
may consist of unrated obligations. Unrated
obligations
are not necessarily of lower quality than rated
obligations, but to the extent the fund invests in
unrated obligations, the fund will be more reliant on
the manager's judgment, analysis and experience than
would be the case if the fund invested only in rated
obligations.

Municipal Bonds.  Municipal Bonds generally are
understood to include debt obligations issued to
obtain
funds for various public purposes, including
construction of a wide range of public facilities,
refunding of outstanding obligations, payment of
general
operating expenses and extensions of loans to public
institutions and facilities.  Private activity bonds
that are issued by or on behalf of public authorities
to
finance various privately operated facilities are
included within the term Municipal Bonds if the
interest
paid thereon qualifies as excluded from gross income
(but not necessarily from alternative minimum taxable
income) for federal income tax purposes in the opinion
of bond counsel to the issuer.

The yield on Municipal Bonds is dependent upon a
variety
of factors, including general economic and monetary
conditions, general money market conditions, general
conditions of the Municipal Bond market, the financial
condition of the issuer, the size of a particular
offering, the maturity of the obligation offered and
the
rating of the issue.

Municipal Bonds also are subject to the provisions of
bankruptcy, insolvency and other laws affecting the
rights and remedies of creditors, such as the federal
Bankruptcy Code, and laws, if any, that may be enacted
by Congress or state legislatures extending the time
for
payment of principal or interest, or both, or imposing
other constraints upon enforcement of such obligations
or upon the ability of municipalities to levy taxes.
There is also the possibility that, as a result of
litigation or other conditions, the power or ability
of
any one or more issuers to pay, when due, the
principal
of and interest on its or their Municipal Bonds may be
materially affected.

Municipal Leases.  The fund may invest without limit
in
"municipal leases," which generally are participations
in intermediate-and short-term debt obligations issued
by municipalities consisting of leases or installment
purchase contracts for property or equipment.
Although
lease obligations do not constitute general
obligations
of the municipality for which the municipality's
taxing
power is pledged, a lease obligation is ordinarily
backed by the municipality's covenant to budget for,
appropriate and make the payments due under the lease
obligation.  However, certain lease obligations
contain
"non-appropriation" clauses that provide that the
municipality has no obligation to make lease or
installment purchase payments in future years unless
money is appropriated for such purpose yearly.  In
addition to the "non-appropriation" risk, these
securities represent a relatively new type of
financing
that has not yet developed the depth of marketability
associated with more conventional bonds.  Although
"non-
appropriation" lease obligations are often secured by
the underlying property, disposition of the property
in
the event of foreclosure might prove difficult. There
is
no limitation on the percentage of the fund's assets
that may be invested in municipal lease obligations.
In
evaluating municipal lease obligations, the manager
will
consider such factors as it deems appropriate, which
may
include: (a) whether the lease can be canceled; (b)
the
ability of the lease obligee to direct the sale of the
underlying assets; (c) the general creditworthiness of
the lease obligor; (d) the likelihood that the
municipality will discontinue appropriating funding
for
the leased property in the event such property is no
longer considered essential by the municipality; (e)
the
legal recourse of the lease obligee in the event of
such
a failure to appropriate funding; (f) whether the
security is backed by a credit enhancement such as
insurance; and (g) any limitations which are imposed
on
the lease obligor's ability to utilize substitute
property or services rather than those covered by the
lease obligation.

Private Activity Bonds.  The fund may invest without
limits in private activity bonds.  Interest income on
certain types of private activity bonds issued after
August 7, 1986 to finance non-governmental activities
is
a specific tax preference item for purposes of the
federal individual and corporate alternative minimum
taxes.  Individual and corporate shareholders may be
subject to a federal alternative minimum tax to the
extent that the fund's dividends are derived from
interest on those bonds.  Dividends derived from
interest income on New Jersey Municipal Securities are
a component of the "current earnings" adjustment item
for purposes of the federal corporate alternative
minimum tax.

The fund may invest without limit in debt obligations
which are repayable out of revenue streams generated
from economically-related projects or facilities or
debt
obligations whose issuers are located in the same
state.
 Sizeable investments in such obligations could
involve
an increased risk to the fund should any of the
related
projects or facilities experience financial
difficulties
 Revenue securities may also include private activity
bonds which may be issued by or on behalf of public
authorities to finance various privately operated
facilities and are not payable from the unrestricted
revenues of the issuers.  Sizable investments in such
obligations could involve an increased risk to the
fund
should any of the related projects or facilities
experience financial difficulties.

Zero Coupon Securities.  Zero coupon securities
involve
special considerations.  The fund may also invest in
zero coupon bonds.  Zero coupon securities are debt
obligations which do not entitle the holder to any
periodic payments of interest prior to maturity of a
specified cash payment date when the securities begin
paying current interest (the "cash payment date") and
therefore are issued and traded at a discount from
their
face amounts or par values. The discount varies
depending on the time remaining until maturity or cash
payment date, prevailing interest rates, liquidity of
the security and the perceived credit quality of the
issuer. The discount, in the absence of financial
difficulties of the issuer, decreases as the final
maturity or cash payment date of the security
approaches.  The market prices of zero coupon
securities
generally are more volatile than the market prices of
other debt securities that pay interest periodically
and
are likely to respond to changes in interest rates to
a
greater degree than do debt securities having similar
maturities and credit quality.  The credit risk
factors
pertaining to low-rated securities also apply to low-
rated zero coupon bonds.  Such zero coupon bonds carry
an additional risk in that, unlike bonds which pay
interest throughout the period to maturity, the fund
will realize no cash until the cash payment date
unless
a portion of such securities is sold and, if the
issuer
defaults, the fund may obtain no return at all on its
investment.

Current federal income tax laws may require the holder
of a zero coupon security to accrue income with
respect
to that security prior to the receipt of cash
payments.
To maintain its qualification as a regulated
investment
company and avoid liability for federal income taxes,
the fund may be required to distribute income accrued
with respect to zero coupon securities and may have to
dispose of portfolio securities under disadvantageous
circumstances in order to generate cash to satisfy
these
distribution requirements.

When-Issued Securities.  The fund may purchase
Municipal
Bonds on a "when-issued" basis (i.e., for delivery
beyond the normal settlement date at a stated price
and
yield).  The payment obligation and the interest rate
that will be received on the Municipal Bonds purchased
on a when-issued basis are each fixed at the time the
buyer enters into the commitment. Although the fund
will
purchase Municipal Bonds on a when-issued basis only
with the intention of actually acquiring the
securities,
the fund may sell these securities before the
settlement
date if it is deemed advisable as a matter of
investment
strategy.

Municipal Bonds are subject to changes in value based
upon the public's perception of the creditworthiness
of
the issuers and changes, real or anticipated, in the
level of interest rates. In general, Municipal Bonds
tend to appreciate when interest rates decline and
depreciate when interest rates rise. Purchasing
Municipal Bonds on a when-issued basis, therefore, can
involve the risk that the yields available in the
market
when the delivery takes place may actually be higher
than those obtained in the transaction itself. To
account for this risk, a separate account of the fund
consisting of cash or liquid debt securities equal to
the amount of the when-issued commitments will be
established at the fund's custodian bank. For the
purpose of determining the adequacy of the securities
in
the account, the deposited securities will be valued
at
market or fair value. If the market or fair value of
such securities declines, additional cash or
securities
will be placed in the account on a daily basis so the
value of the account will equal the amount of such
commitments by the fund. Placing securities rather
than
cash in the segregated account may have a leveraging
effect on the fund's net assets.  That is, to the
extent
the fund remains substantially fully invested in
securities at the same time it has committed to
purchase
securities on a when-issued basis, there will be
greater
fluctuations in its net assets than if it had set
aside
cash to satisfy its purchase commitments. Upon the
settlement date of the when-issued securities, the
fund
will meet obligations from then-available cash flow,
sale of securities held in the segregated account,
sale
of other securities or, although it normally would not
expect to do so, from the sale of the when-issued
securities themselves (which may have a value greater
or
less than the fund's payment obligations). Sales of
securities to meet such obligations may involve the
realization of capital gains, which are not exempt
from
federal income taxes or New Jersey state personal
income
tax.

When the fund engages in when-issued transactions, it
relies on the seller to consummate the trade. Failure
of
the seller to do so may result in the fund's incurring
a loss or missing an opportunity to obtain an
advantageous price.

Repurchase Agreements. As a defensive position only,
the
fund may enter into repurchase agreements with banks
which are the issuers of instruments acceptable for
purchase by the fund and with certain dealers on the
Federal Reserve Bank of New York's list of reporting
dealers. A repurchase agreement is a contract under
which the buyer of a security simultaneously commits
to
resell the security to the seller at an agreed-upon
price on an agreed-upon date. Under the terms of a
typical repurchase agreement, the fund would acquire
an
underlying debt obligation for a relatively short
period
of time (usually not more than seven days) subject to
an
obligation of the seller to repurchase, and the fund
to
resell, the obligation at an agreed-upon price and
time,
thereby determining the yield during the fund's
holding
period. This arrangement results in a fixed rate of
return that is not subject to market fluctuations
during
the fund's holding period. Under each repurchase
agreement, the selling institution will be required to
maintain the value of the securities subject to the
repurchase agreement at not less than their repurchase
price. Repurchase agreements could involve certain
risks
in the event of default or insolvency of the other
party, including possible delays or restrictions upon
the fund's ability to dispose of the underlying
securities, the risk of a possible decline in the
value
of the underlying securities during the period in
which
the fund seeks to assert its rights to them, the risk
of
incurring expenses associated with asserting those
rights and the risk of losing all or part of the
income
from the agreement. In evaluating these potential
risks,
the manager, acting under the supervision of the
fund's
board of directors, reviews on an ongoing basis the
value of the collateral and the creditworthiness of
those banks and dealers with which the fund enters
into
repurchase agreements.

Lending of Portfolio Securities.  Consistent with
applicable regulatory requirements, the fund may lend
its portfolio securities to brokers, dealers and other
financial organizations.  Loans of portfolio
securities
by the fund will be collateralized by cash, letters of
credit or obligations of the United States government
or
its agencies and instrumentalities which are
maintained
at all times in an amount equal to at least 100% of
the
current market value of the loaned securities.  By
lending its portfolio securities, the fund will seek
to
generate income by continuing to receive interest on
the
loaned securities, by investing the cash collateral in
short-term instruments or by obtaining yield in the
form
of interest paid by the borrower when U.S. government
securities are used as collateral. The risks in
lending
portfolio securities, as with other extensions of
secured credit, consist of possible delays in
receiving
additional collateral or in the recovery of the
securities or possible loss of rights in the
collateral
should the borrower fail financially.  Loans will be
made to firms deemed by the manager to be of good
standing and will not be made unless, in the judgment
of
the manager, the consideration to be earned from such
loans would justify the risk.

Temporary Investments.  When the fund is maintaining a
defensive position, the fund may invest in short-term
investments ("Temporary Investments") consisting of:
(a)
tax-exempt securities in the form of notes of
municipal
issuers having, at the time of purchase, a rating
within
the three highest grades of Moody's, S&P or the
equivalent rating from another NRSRO or, if not rated,
having an issue of outstanding Municipal Bonds rated
within the three highest grades by Moody's, S&P or the
equivalent rating from another NRSRO; and (b) the
following taxable securities: obligations of the
United
States government, its agencies or instrumentalities
("U.S. government securities"), repurchase agreements,
other debt securities rated within the three highest
grades by Moody's, S&P or the equivalent rating from
another NRSRO, commercial paper rated in the highest
grade by either of such rating services, and
certificates of deposit of domestic banks with assets
of
$1 billion or more. The fund may invest in Temporary
Investments for defensive reasons in anticipation of a
market decline. At no time will more than 20% of the
fund's total assets be invested in Temporary
Investments
unless the fund has adopted a defensive investment
policy. The fund intends, however, to purchase tax-
exempt Temporary Investments pending the investment of
the proceeds of the sale of portfolio securities or
shares of the fund's common stock, or in order to have
highly liquid securities available to meet anticipated
redemptions.  For the fiscal year ended  March 31,
2001,
the fund did not invest in taxable Temporary
Investments.

Financial Futures and Options Transactions.  The fund
may enter into financial futures contracts and invest
in
options on financial futures contracts that are traded
on a domestic exchange or board of trade.  Such
investments, if any, by the fund will be made for the
purpose of hedging against changes in the value of
portfolio securities due to anticipated changes in
interest rates and market conditions and where the
transactions are economically appropriate to the
reduction of risks inherent in the management of the
fund. The futures contracts or options on futures
contracts that may be entered into by the fund will be
restricted to those that are either based on a
municipal
bond index or related to debt securities, the prices
of
which are anticipated by the manager to correlate with
the prices of the New Jersey Municipal Securities
owned
or to be purchased by the fund.

In entering into a financial futures contract, the
fund
will be required to deposit with the broker through
which it undertakes the transaction an amount of cash
or
cash equivalents equal to approximately 5% of the
contract amount.  This amount, which is known as
"initial margin," is subject to change by the exchange
or board of trade, which may charge a higher amount.
Initial margin is in the nature of a performance bond
or
good faith deposit on the contract that is returned to
the fund upon termination of the futures contract,
assuming all contractual obligations have been
satisfied. In accordance with a process known as
"marking-to-market," subsequent payments, known as
"variation margin," to and from the broker will be
made
daily as the price of the index or securities
underlying
the futures contract fluctuates, making the long and
short positions in the futures contract more or less
valuable.  At any time prior to the expiration of a
futures contract, the fund may elect to close the
position by taking an opposite position, which will
operate to terminate the fund's existing position in
the
contract.

A financial futures contract provides for the future
sale by one party and the purchase by the other party
of
a certain amount of a specified property at a
specified
price, date, time and place.  Unlike the direct
investment in a futures contract, an option on a
financial futures contract gives the purchaser the
right, in return for the premium paid, to assume a
position in the financial futures contract at a
specified exercise price at any time prior to the
expiration date of the option.  Upon exercise of an
option, the delivery of the futures position by the
writer of the option to the holder of the option will
be
accompanied by delivery of the accumulated balance in
the writer's futures margin account, which represents
the amount by which the market price of the futures
contract exceeds, in the case of a call, or is less
than, in the case of a put, the exercise price of the
option on the futures contract.  The potential loss
related to the purchase of an option on a financial
futures contract is limited to the premium paid for
the
option (plus transaction costs).  The value of the
option may change daily and that change would be
reflected in the net asset value of the fund.

Regulations of the Commodity Futures Trading
Commission
applicable to the fund require that its transactions
in
financial futures contracts and options on financial
futures contracts be engaged in for bona fide hedging
purposes, or if the fund enters into futures contracts
for speculative purposes, that the aggregate initial
margin deposits and premiums paid by the fund will not
exceed 5% of the market value of its assets.  In
addition, the fund will, with respect to its purchases
of financial futures contracts, establish a segregated
account consisting of cash or cash equivalents in an
amount equal to the total market value of the futures
contracts, less the amount of initial margin on a
deposit for the contracts.

Municipal Bond Index Futures Contracts. A municipal
bond
index futures contract is an agreement pursuant to
which
two parties agree to take or make delivery of an
amount
of cash equal to a specific dollar amount multiplied
by
the difference between the value of the index at the
close of the last trading day of the contract and the
price at which the index contract was originally
written. No physical delivery of the underlying
municipal bonds in the index is made. Municipal bond
index futures contracts based on an index of 40 tax-
exempt, long-term municipal bonds with an original
issue
size of at least $50 million and a rating of A- or
higher by S&P or A or higher by Moody's began trading
in
mid-1985.  The purpose of the acquisition or sale of a
municipal bond index futures contract by the fund, as
the holder of long-term municipal securities, is to
protect the fund from fluctuations in interest rates
on
tax-exempt securities without actually buying or
selling
long-term municipal securities.

There are several risks in connection with the use of
futures contracts as a hedging device. Successful use
of
futures contracts by the fund is subject to the
manager's ability to predict correctly movements in
the
direction of interest rates. Such predictions involve
skills and techniques which may be different from
those
involved in the management of a long-term municipal
bond
portfolio. In addition, there can be no assurance that
there will be a correlation between movements in the
price of the municipal bond index and movements in the
price of the Municipal Bonds that are the subject of
the
hedge.  The degree of imperfection of correlation
depends upon various circumstances, such as variations
in speculative market demand for futures contracts and
municipal securities, technical influences on futures
trading, and differences between the municipal
securities being hedged and the municipal securities
underlying the futures contracts, in such respects as
interest rate levels, maturities and creditworthiness
of
issuers.  A decision of whether, when and how to hedge
involves the exercise of skill and judgment and even a
well-conceived hedge may be unsuccessful to some
degree
because of market behavior or unexpected trends in
interest rates.

Although the fund intends to purchase or sell futures
contracts only if there is an active market for such
contracts, there is no assurance that a liquid market
will exist for the contracts at any particular time.
Most domestic futures exchanges and boards of trade
limit the amount of fluctuation permitted in futures
contract prices during a single trading day. The daily
limit establishes the maximum amount the price of a
futures contract may vary either up or down from the
previous day's settlement price at the end of a
trading
session.  Once the daily limit has been reached in a
particular contract, no trades may be made that day at
a price beyond that limit. The daily limit governs
only
price movement during a particular trading day and,
therefore, does not limit potential losses because the
limit may prevent the liquidation of unfavorable
positions. It is possible that futures contract prices
could move to the daily limit for several consecutive
trading days with little or no trading, thereby
preventing prompt liquidation of futures positions and
subjecting some futures traders to substantial losses.
In such event, it will not be possible to close a
futures position and, in the event of adverse price
movements, the fund would be required to make daily
cash
payments of variation margin.  In such circumstances,
an
increase in the value of the portion of the portfolio
being hedged, if any, may partially or completely
offset
losses on the futures contract. As described above,
however, there is no guarantee that the price of
Municipal Bonds will, in fact, correlate with the
price
movements in the municipal bond index futures contract
and thus provide an offset to losses on a futures
contract.

If the fund has hedged against the possibility of an
increase in interest rates adversely affecting the
value
of the Municipal Bonds held in its portfolio and rates
decrease instead, the fund will lose part or all of
the
benefit of the increased value of the Municipal Bonds
it
has hedged because it will have offsetting losses in
its
futures positions. In addition, in such situations, if
the fund has insufficient cash, it may have to sell
securities to meet daily variation margin
requirements.
Such sales of securities may, but will not
necessarily,
be at increased prices which reflect the decline in
interest rates. The fund may have to sell securities
at
a time when it may be disadvantageous to do so.

When the fund purchases municipal bond index futures
contracts, an amount of cash and U.S. government
securities or other high grade debt securities equal
to
the market value of the futures contracts will be
deposited in a segregated account with the fund's
custodian (and/or such other persons as appropriate)
to
collateralize the positions and thereby insure that
the
use of such futures contracts is not leveraged.

Options on Financial Futures Contracts. The fund may
purchase put and call options on futures contracts
which
are traded on a domestic exchange or board of trade as
a hedge against changes in interest rates, and may
enter
into closing transactions with respect to such options
to terminate existing positions. The fund will sell
put
and call options on interest rate futures contracts
only
as part of closing sale transactions to terminate its
options positions. There is no guarantee that such
closing transactions can be effected.

Options on futures contracts, as contrasted with the
direct investment in such contracts, give the
purchaser
the right, in return for the premium paid, to assume a
position in futures contracts at a specified exercise
price at any time prior to the expiration date of the
options. Upon exercise of an option, the delivery of
the
futures position by the writer of the option to the
holder of the option will be accompanied by delivery
of
the accumulated balance in the writer's futures
contract
margin account, which represents the amount by which
the
market price of the futures contract exceeds, in the
case of a call, or is less than, in the case of a put,
the exercise price of the option on the futures
contract. The potential loss related to the purchase
of
an option on interest rate futures contracts is
limited
to the premium paid for the option (plus transaction
costs). Because the value of the option is fixed at
the
point of sale, there are no daily cash payments to
reflect changes in the value of the underlying
contract;
however, the value of the option does change daily and
that change would be reflected in the net asset value
of
the fund.

There are several risks relating to options on futures
contracts.  The ability to establish and close out
positions on such options will be subject to the
existence of a liquid market. In addition, the fund's
purchase of put or call options will be based upon
predictions as to anticipated interest rate trends by
the manager, which could prove to be inaccurate.  Even
if the manager's expectations are correct there may be
an imperfect correlation between the change in the
value
of the options and of the fund's portfolio securities.

Other Investments. The fund may invest up to 15% of
its
total assets in securities with contractual or other
restrictions on resale and other instruments which are
not readily marketable. Notwithstanding the foregoing,
the fund will not invest more than 10% of its assets
in
securities (excluding those subject to Rule 144A under
the Securities Act of 1933, as amended (the "1933
Act"))
that are restricted.  The fund does not expect to
invest
more than 5% of its assets in repurchase agreements.
In
addition, the fund may invest up to 5% of its assets
in
the securities of issuers which have been in
continuous
operation for less than three years. The fund also is
authorized to borrow an amount of up to 10% of its
total
assets (including the amount borrowed) valued at
market
less liabilities (not including the amount borrowed)
in
order to meet anticipated redemptions and to pledge
its
assets to the same extent in connection with the
borrowings.

INVESTMENT RESTRICTIONS

The fund has adopted the following investment
restrictions for the protection of shareholders.
Restrictions 1 through 6 below may not be changed
without the approval of the holders of a majority of
the
outstanding shares of the fund, defined as the lesser
of
(a) 67% of the fund's shares present at a meeting if
the
holders of more than 50% of the outstanding shares are
present in person or by proxy or (b) more than 50% of
the fund's outstanding shares.  The remaining
restrictions may be changed by the fund's board of
directors at any time.  The fund's investment
objective
is fundamental and may not be changed without the
approval of the holders of a majority of the
outstanding
shares of the fund.



The fund may not:

	1.	Issue "senior securities" as defined in
the
1940 Act and the rules, regulations and orders
thereunder, except as permitted under the 1940 Act and
the rules, regulations and orders thereunder.

	2.	Invest more than 25% of its total assets
in
securities, the issuers of which are in the same
industry.  For purposes of this limitation, U.S.
government securities and securities of state or
municipal governments and their political subdivisions
are not considered to be issued by members of any
industry.

	3. 	Borrow money, except that (a) the fund may
borrow from banks for temporary or emergency (not
leveraging) purposes, including the meeting of
redemption requests which might otherwise require the
untimely disposition of securities, and (b) the fund
may, to the extent consistent with its investment
policies, enter into reverse repurchase agreements,
forward roll transactions and similar investment
strategies and techniques.  To the extent that it
engages in transactions described in (a) and (b), the
fund will be limited so that no more than 33 1/3% of
the
value of its total assets (including the amount
borrowed), valued at the lesser of cost or market,
less
liabilities (not including the amount borrowed) is
derived from such transactions.

	4.	Make loans.  This restriction does not
apply
to: (a) the purchase of debt obligations in which the
fund may invest consistent with its investment
objectives and policies; (b) repurchase agreements;
and
(c) loans of its portfolio securities, to the fullest
extent permitted under the 1940 Act.

	5.	Engage in the business of underwriting
securities issued by other persons, except to the
extent
that the fund may technically be deemed to be an
underwriter under the 1933 Act in disposing of
portfolio
securities.

	6.	Purchase or sell real estate, real estate
mortgages, commodities or commodity contracts, but
this
restriction shall not prevent the fund from (a)
investing in securities of issuers engaged in the real
estate business or the business of investing in real
estate (including interests in limited partnerships
owning or otherwise engaging in the real estate
business
or the business of investing in real estate) and
securities which are secured by real estate or
interests
therein; (b) holding or selling real estate received
in
connection with securities it holds or held; (c)
trading
in futures contracts and options on futures contracts
(including options on currencies to the extent
consistent with the fund's investment objective and
policies); or (d) investing in real estate investment
trust securities.

	7. 	Purchase any securities on margin (except
for such short-term credits as are necessary for the
clearance of purchases and sales of portfolio
securities) or sell any securities short (except
"against the box").  For purposes of this restriction,
the deposit or payment by the fund of underlying
securities and other assets in escrow and collateral
agreements with respect to initial or maintenance
margin
in connection with futures contracts and related
options
and options on securities, indexes or similar items is
not considered to be the purchase of a security on
margin.

	8.	Purchase or otherwise acquire any security
if, as a result, more than 15% of its net assets would
be invested in securities that are illiquid.

	9.	Purchase or sell oil and gas interests.

	10.	Invest more than 5% of the value of its
total assets in the securities of issuers having a
record, including predecessors, of less than three
years
of continuous operation, except U.S. government
securities.  For purposes of this restriction, issuers
include predecessors, sponsors, controlling persons,
general partners, guarantors and originators of
underlying assets.

	11.	Invest in companies for the purpose of
exercising control.

	12. 	Invest in securities of other investment
companies, except as they may be acquired as part of a
merger, consolidation or acquisition of assets and
except to the extent permitted by Section 12 of the
1940
Act (currently, up to 5% of the total assets of the
fund
and no more than 3% of the total outstanding voting
stock of any one investment company).

	13.	Engage in the purchase or sale of put,
call,
straddle or spread options or in the writing of such
options, except that the fund may engage in
transactions
involving municipal bond index and interest rate
futures
contracts and options thereon after approval of these
investment strategies by the board of directors and
notice thereof to the fund's shareholders.

Certain restrictions listed above permit the fund to
engage in investment practices that the fund does not
currently pursue.  The fund has no present intention
of
altering its current investment practices as otherwise
described in the prospectus and this SAI and any
future
change in those practices would require Board approval
and appropriate notice to shareholders.  If a
percentage
restriction is complied with at the time of an
investment, a later increase or decrease in the
percentage of assets resulting from a change in the
values of portfolio securities or in the amount of the
fund's assets will not constitute a violation of such
restriction.

RISK FACTORS

The following summaries are included for the purpose
of
providing certain information regarding the economic
climate and financial condition of the State of New
Jersey and Puerto Rico, and are based primarily on
information from official statements made available in
connection with the issuance of certain securities and
other documents and sources and does not purport to be
complete. The fund has not undertaken to verify
independently such information and the fund assumes no
responsibility for the accuracy of such information.
These summaries do not provide information regarding
most securities in which the fund is permitted to
invest
and in particular do not provide specific information
on
the issuers or types of municipal securities in which
the fund invests or the private business entities
whose
obligations support the payments on private activity
bonds ("AMT-Subject bonds"), which include industrial
development bonds and bonds issued to finance such
projects as airports, housing projects, solid waste
disposal facilities, student loan programs and water
and
sewage projects, in which the fund will invest.  See
"Alternative Minimum Tax" below.  Therefore, the
general
risk factors as to the credit of the state or its
political subdivisions discussed herein may not be
relevant to the fund.  Although revenue obligations of
a state or its political subdivisions may be payable
from a specific project or source, there can be no
assurance that future economic difficulties and the
resulting impact on state and local government
finances
will not adversely affect the market value of the fund
or the ability of the respective obligors to make
timely
payments of principal and interest on such
obligations.
 In addition, a number of factors may adversely affect
the ability of the issuers of municipal securities to
repay their borrowings that are unrelated to the
financial or economic condition of a state, and that,
in
some cases, are beyond their control. Furthermore,
issuers of municipal securities are generally not
required to provide ongoing information about their
finances and operations to holders of their debt
obligations, although a number of cities, counties and
other issuers prepare annual reports.

Alternative Minimum Tax

Under current federal income tax law, (1) interest on
tax-exempt municipal securities issued after August 7,
1986 which are "specified private activity bonds," and
the proportionate share of any exempt-interest
dividend
paid by a regulated investment company which receives
interest from such specified private activity bonds,
will be treated as an item of tax preference for
purposes of the alternative minimum tax ("AMT")
imposed
on individuals and corporations, though for regular
federal income tax purposes such interest will remain
fully tax-exempt, and (2) interest on all Tax-Exempt
Obligations will be included in "adjusted current
earnings" of corporations for AMT purposes.  Such AMT-
subject bonds have provided, and may continue to
provide, somewhat higher yields than other comparable
municipal securities.

Investors should consider that, in most instances, no
state, municipality or other governmental unit with
taxing power will be obligated with respect to AMT-
Subject bonds.  AMT-Subject bonds are in most cases
revenue bonds and do not generally have the pledge of
the credit or the taxing power, if any, of the issuer
of
such bonds.  AMT-Subject bonds are generally limited
obligations of the issuer supported by payments from
private business entities and not by the full faith
and
credit of a state or any governmental subdivision.
Typically the obligation of the issuer of AMT-Subject
bonds is to make payments to bond holders only out of
and to the extent of, payments made by the private
business entity for whose benefit the AMT-Subject
bonds
were issued.  Payment of the principal and interest on
such revenue bonds depends solely on the ability of
the
user of the facilities financed by the bonds to meet
its
financial obligations and the pledge, if any, of real
and personal property so financed as security for such
payment.  It is not possible to provide specific
detail
on each of these obligations in which fund assets may
be
invested.

Risk of Concentration In a Single State

The primary purpose of investing in a portfolio of a
single state's municipal securities is the special tax
treatment accorded the state's resident individual
investors.  However, payment of interest and
preservation of principal is dependent upon the
continuing ability of the state's issuers and/or
obligors on state, municipal and public authority debt
obligations to meet their obligations thereunder.
Investors should be aware of certain factors that
might
affect the financial condition of issuers of municipal
securities, consider the greater risk of the
concentration of a fund versus the safety that comes
with a less concentrated investment portfolio and
compare yields available in portfolios of the relevant
state's issues with those of more diversified
portfolios, including out-of-state issues, before
making
an investment decision.

Municipal securities in which the fund's assets are
invested may include debt obligations of the
municipalities and other subdivisions of the relevant
state issued to obtain funds for various public
purposes, including the construction of a wide range
of
public facilities such as airports, bridges, highways,
schools, streets and water and sewer works.  Other
purposes for which municipal securities may be issued
include the obtaining of funds to lend to public or
private institutions for the construction of
facilities
such as educational, hospital, housing, and solid
waste
disposal facilities.  The latter, including most AMT-
Subject bonds, are generally payable from private
sources which, in varying degrees, may depend on local
economic conditions, but are not necessarily affected
by
the ability of the state and its political
subdivisions
to pay their debts.  It is not possible to provide
specific details on each of these obligations in which
fund  assets may be invested. However, all such
securities, the payment of which is not a general
obligation of an issuer having general taxing power,
must satisfy, at the time of an acquisition by the
fund,
the minimum rating(s). See "Appendix A: Bond and
Commercial Paper Ratings" for a description of ratings
and rating criteria.  Some municipal securities may be
rated based on a "moral obligation" contract which
allows the municipality to terminate its obligation by
deciding not to make an appropriation.  Generally, no
legal remedy is available against the municipality
that
is a party to the "moral obligation" contract in the
event of such non-appropriation.

Municipal Market Volatility. Municipal securities can
be
significantly affected by political changes as well as
uncertainties in the municipal market related to
taxation, legislative changes, or the rights of
municipal security holders. Because many municipal
securities are issued to finance similar projects,
especially those relating to education, health care,
transportation and utilities, conditions in those
sectors can affect the overall municipal market. In
addition, changes in the financial condition of an
individual municipal insurer can affect the overall
municipal market.

Interest Rate Changes.  Debt securities have varying
levels of sensitivity to changes in interest rates. In
general, the price of a debt security can fall when
interest rates rise and can rise when interest rates
fall. Securities with longer maturities can be more
sensitive to interest rate changes. In other words,
the
longer the maturity of a security, the greater the
impact a change in interest rates could have on the
security's price. In addition, short-term and long-
term
interest rates do not necessarily move in the same
amount or the same direction. Short-term securities
tend
to react to changes in short-term interest rates, and
long-term securities tend to react to changes in long-
term interest rates.

Issuer-Specific Changes. Changes in the financial
condition of an issuer, changes in specific economic
or
political conditions that affect a particular type of
security or issuer, and changes in general economic or
political conditions can affect the credit quality or
value of an issuer's securities. Lower-quality debt
securities (those of less than investment-grade
quality)
tend to be more sensitive to these changes than
higher-
quality debt securities. Entities providing credit
support or a maturity-shortening structure also can be
affected by these types of changes. Municipal
securities
backed by current or anticipated revenues from a
specific project or specific assets can be affected
negatively by the discontinuance of the taxation
supporting the project or assets or the inability to
collect revenues from the project or from the assets.
If
the Internal Revenue Service determines an issuer of a
municipal security has not complied with applicable
tax
requirements, or the structure of a security fails to
function as intended, interest from the security could
become taxable or the security could decline
significantly in value.

Municipal Market Disruption Risk. The value of
municipal
securities may be affected by uncertainties in the
municipal market related to legislation or litigation
involving the taxation of municipal securities or the
rights of municipal securities holders in the event of
a bankruptcy. Proposals to restrict or eliminate the
federal income tax exemption for interest on municipal
securities are introduced before Congress from time to
time.  Proposals also may be introduced before the New
Jersey legislature that would affect the state tax
treatment of a municipal fund's distributions.  If
such
proposals were enacted, the availability of municipal
securities and the value of a municipal fund's
holdings
would be affected and the Trustees would reevaluate
the
fund's investment objectives and policies.  Municipal
bankruptcies are relatively rare, and certain
provisions
of the U.S. Bankruptcy Code governing such
bankruptcies
are unclear and remain untested.  Further, the
application of state law to municipal issuers could
produce varying results among the states or among
municipal securities issuers within a state.  These
legal uncertainties could affect the municipal
securities market generally, certain specific segments
of the market, or the relative credit quality of
particular securities.  Any of these effects could
have
a significant impact on the prices of some or all of
the
municipal securities held by a fund, making it more
difficult for a money market fund to maintain a stable
net asset value per share.

Education. In general, there are two types of
education-
related bonds; those issued to finance projects for
public and private colleges and universities, and
those
representing pooled interests in student loans.  Bonds
issued to supply educational institutions with funds
are
subject to the risk of unanticipated revenue decline,
primarily the result of decreasing student enrollment
or
decreasing state and federal funding.  Among the
factors
that may lead to declining or insufficient revenues
are
restrictions on students' ability to pay tuition,
availability of state and federal funding, and general
economic conditions.  Student loan revenue bonds are
generally offered by state (or substate) authorities
or
commissions and are backed by pools of student loans.
 Underlying student loans may be guaranteed by state
guarantee agencies and may be subject to reimbursement
by the United States Department of Education through
its
guaranteed student loan program.  Others may be
private,
uninsured loans made to parents or students which are
supported by reserves or other forms of credit
enhancement. Recoveries of principal due to loan
defaults may be applied to redemption of bonds or may
be
used to re-lend, depending on program latitude and
demand for loans.  Cash flows supporting student loan
revenue bonds are impacted by numerous factors,
including the rate of student loan defaults, seasoning
of the loan portfolio, and student repayment deferral
periods of forbearance. Other risks associated with
student loan revenue bonds include potential changes
in
federal legislation regarding student loan revenue
bonds, state guarantee agency reimbursement and
continued federal interest and other program subsidies
currently in effect.

Electric Utilities. The electric utilities industry
has
been experiencing, and will continue to experience,
increased competitive pressures.  Federal legislation
in
the last two years will open transmission access to
any
electricity supplier, although it is not presently
known
to what extent competition will evolve.  Other risks
include: (a) the availability and cost of fuel, (b)
the
availability and cost of capital, (c) the effects of
conservation on energy demand, (d) the effects of
rapidly changing environmental, safety, and licensing
requirements, and other federal, state, and local
regulations, (e) timely and sufficient rate increases,
and (f) opposition to nuclear power.

Health Care. The health care industry is subject to
regulatory action by a number of private and
governmental agencies, including federal, state, and
local governmental agencies.  A major source of
revenues
for the health care industry is payments from the
Medicare and Medicaid programs. As a result, the
industry is sensitive to legislative changes and
reductions in governmental spending for such programs.
 Numerous other factors may affect the industry, such
as
general and local economic conditions; demand for
services; expenses (including malpractice insurance
premiums); and competition among health care
providers.
In the future, the following elements may adversely
affect health care facility operations: adoption of
legislation proposing a national health insurance
program; other state or local health care reform
measures; medical and technological advances which
dramatically alter the need for health services or the
way in which such services are delivered; changes in
medical coverage which alter the traditional fee-for-
service revenue stream; and efforts by employers,
insurers, and governmental agencies to reduce the
costs
of health insurance and health care services.

Housing. Housing revenue bonds are generally issued by
a state, county, city, local housing authority, or
other
public agency.  They generally are secured by the
revenues derived from mortgages purchased with the
proceeds of the bond issue.  It is extremely difficult
to predict the supply of available mortgages to be
purchased with the proceeds of an issue or the future
cash flow from the underlying mortgages.
Consequently,
there are risks that proceeds will exceed supply,
resulting in early retirement of bonds, or that
homeowner repayments will create an irregular cash
flow.
 Many factors may affect the financing of multi-family
housing projects, including acceptable completion of
construction, proper management, occupancy and rent
levels, economic conditions, and changes to current
laws
and regulations.

Transportation. Transportation debt may be issued to
finance the construction of airports, toll roads,
highways, or other transit facilities.  Airport bonds
are dependent on the general stability of the airline
industry and on the stability of a specific carrier
who
uses the airport as a hub.  Air traffic generally
follows broader economic trends and is also affected
by
the price and availability of fuel. Toll road bonds
are
also affected by the cost and availability of fuel as
well as toll levels, the presence of competing roads
and
the general economic health of an area.  Fuel costs
and
availability also affect other transportation-related
securities, as do the presence of alternate forms of
transportation, such as public transportation.

Water and Sewer. Water and sewer revenue bonds are
often
considered to have relatively secure credit as a
result
of their issuer's importance, monopoly status, and
generally unimpeded ability to raise rates.  Despite
this, lack of water supply due to insufficient rain,
run-off, or snow pack is a concern that has led to
past
defaults. Further, public resistance to rate
increases,
costly environmental litigation, and Federal
environmental mandates are challenges faced by issuers
of water and sewer bonds.

RISK FACTORS

The following summaries are included for the purpose
of
providing certain information regarding the economic
climate and financial condition of the State of New
Jersey, Puerto Rico, Guam and the U.S. Virgin Islands,
and are based primarily on information from official
statements made available in connection with the
issuance of certain securities and other documents and
sources and does not purport to be complete. The fund
has not undertaken to verify independently such
information and the trust assumes no responsibility
for
the accuracy of such information and will not update
it
during the year.  These summaries do not provide
information regarding most securities in which the
fund
is permitted to invest and in particular do not
provide
specific information on the issuers or types of
municipal securities in which the fund invests or the
private business entities whose obligations support
the
payments on Alternative Minimum Tax-Subject bonds in
which the fund will invest.

Therefore, the general risk factors as to the credit
of
the state or its political subdivisions discussed
herein
may not be relevant to the fund.  Although revenue
obligations of a state or its political subdivisions
may
be payable from a specific project or source, there
can
be no assurance that future economic difficulties and
the resulting impact on state and local government
finances will not adversely affect the market value of
the fund or the ability of the respective obligors to
make timely payments of principal and interest on such
obligations.  In addition, a number of factors may
adversely affect the ability of the issuers of
municipal
securities to repay their borrowings that are
unrelated
to the financial or economic condition of a state, and
that, in some cases, are beyond their control.
Furthermore, issuers of municipal securities are
generally not required to provide ongoing information
about their finances and operations to holders of
their
debt obligations, although a number of cities,
counties
and other issuers prepare annual reports.

NEW JERSEY RISK FACTORS.

The State of New Jersey and public entities therein
are
authorized to issue two general classes of
indebtedness,
the interest on which is exempt from federal income
taxation: general obligation bonds and special
obligation or revenue bonds. Both classes of bonds may
be included in the fund portfolio. The repayment of
principal and interest on general obligation bonds is
secured by the full faith and credit of the issuing
entity, backed up by such entity's taxing authority,
without recourse to any specific project or source of
revenue. Special obligation or revenue bonds are
typically repaid only from revenues received in
connection with the project for which the bonds are
issued, special excise taxes, or other special revenue
sources and are issued by entities without taxing
power.
Unless specifically guaranteed, neither the State of
New
Jersey, any county, municipality nor any political
subdivisions thereof (except for the issuing entity)
are
liable for the payment of principal of or interest on
revenue bonds.

General obligation bonds are repaid from revenues
obtained through the issuing entity's general taxing
authority. The current political climate encourages
maintaining or even lowering current tax levels. New
Jersey law, however, requires taxes to be levied to
repay debt.

Any reduction in the amount of revenue generated by a
facility or project financed by special obligation
bonds
will affect the issuing entity's ability to pay debt
service on such bonds and no assurance can be given
that
sufficient revenues will be obtained from the facility
or project to make such payments, although in some
instances repayment may be guaranteed or otherwise
secured.

There are several types of public agencies in New
Jersey
that are authorized to issue revenue bonds for
essential
public purposes, including utilities authorities,
improvement authorities, sewerage authorities, housing
authorities, parking authorities, redevelopment
agencies
and various other authorities and agencies. These
public
agencies have issued bonds for the construction of
hospitals, housing facilities, pollution control
facilities, water and sewage facilities, power and
electric facilities, resource recovery facilities and
other public projects or facilities.

Certain difficulties may occur in the construction or
operation of such facilities or projects that would
adversely affect the amount of revenues derived
therefrom in order to support the issuing entity's
payment obligation on the bonds issued therefor.
Hospital facilities, for example, are subject to 70
changes in Medicare and Medicaid reimbursement
regulations, attempts by federal and state legislature
to limit costs for health care and management's
ability
to complete construction projects on a timely basis as
well as to maintain projected rates of occupancy and
utilization. At any given time, there may be several
proposals pending on a federal and state level
concerning health care which may further affect a
hospital's debt service obligation. Housing facilities
may be subject to increases in operating costs,
management's ability to maintain occupancy levels,
rent
restrictions and availability of federal or state
subsidies, while power and electric facilities and
resource recovery facilities may be subject to
increased
costs resulting from environmental restrictions,
fluctuations in fuel costs, delays in licensing
procedures and the general regulatory framework in
which
these facilities operate. All of these entities are
constructed and operated under rigid regulatory
guidelines.

The New Jersey Economic Development Authority (the
"EDA") is a major issuer of special obligation bonds
on
a conduit basis in connection with its authority,
pursuant to New Jersey law, to make loans and extend
credit for the financing of projects for public
purposes. The EDA issues the bonds and loans the
proceeds to a borrower who agrees to repay the EDA
amounts sufficient to pay principal and interest on
the
bonds when the same becomes due.

Some borrowers that financed facilities with proceeds
of
industrial development bonds issued by the EDA have
defaulted on their repayment obligations to the EDA.
Since these special obligation bonds were payable only
from money received from the specific projects that
were
funded or from other sources pledged by the borrower
to
support its repayment obligation, the EDA was unable
to
pay debt service to the holders of the bonds issued
for
the respective projects. However, because each issue
of
special obligation bonds depends on its own revenue
for
repayment, these defaults should not affect the
ability
of the EDA to pay debt service on other bonds it
issues
in the future on behalf of qualified borrowers.

New Jersey is the ninth largest state in population
and
the fifth smallest in land area. With an average of
1,098 persons per square mile, it is the most densely
populated of all the states. New Jersey is located at
the center of the megalopolis which extends from
Boston
to Washington, and which includes over one-fifth of
the
country's population. The extensive facilities of the
Port Authority of New York and New Jersey, the
Delaware
River Port Authority and the South Jersey Port
Corporation across the Delaware River from
Philadelphia
augment the air, land and water transportation complex
which has influenced most of New Jersey's economy.
This
central location in the northeastern corridor, the
transportation and port facilities and proximity to
New
York City make New Jersey an attractive location for
corporate headquarters and international business
offices. A number of Fortune Magazine's top 500
companies maintain headquarters or major facilities in
New Jersey, and many foreign-owned firms have located
facilities in New Jersey.

New Jersey's economic base is diversified, consisting
of
a variety of manufacturing, construction and service
industries, supplemented by rural areas with selective
commercial agriculture. New Jersey has the Atlantic
seashore on the east and lakes and mountains in the
north and northwest, which provide recreation for
residents as well as for out-of-state visitors. Since
1976, casino gambling in Atlantic City has been an
important New Jersey tourist attraction.

New Jersey's population grew rapidly in the years
following World War II, before slowing to an annual
rate
of 0.27% in the 1970s. Between 1980 and 1990, the
annual
rate of growth rose to 0.51% and between 1990 and
1999,
accelerated to .55% (according to the United States
Department of Commerce, Bureau of the Census). While
this rate of growth is less than that for the United
States, it compares favorably with other Middle
Atlantic
States.

The small increase in New Jersey's total population
during the past quarter century masks the
redistribution
of population within New Jersey. There has been a
significant shift from the northeastern industrial
areas
toward the four coastal counties (Cape May, Atlantic,
Ocean and Monmouth) and toward the central New Jersey
counties of Hunterdon, Somerset and Middlesex.

During 1999, a continuation of the national business
expansion, a strong business climate in New Jersey and
positive developments in neighboring metropolitan
areas
contributed to New Jersey's economic expansion - the
second strongest year for economic growth since 1988.

Employment within New Jersey increased by 1.7% in
1999,
resulting in an increase of over 65,000 jobs. Job
gains
were primarily spread across the service producing
industries with particularly strong growth in
wholesale
and retail trade (20,500) and business services
(20,200). Computer software and personnel supply
related
companies accounted for the bulk of the job growth in
the business services sub-sector, adding 15,000 jobs.

During the past decade, New Jersey's job growth has
been
concentrated in five major "growth clusters": health,
high technology, logistics, financial and
entertainment.
Combined, these five growth clusters added over
200,000
jobs during the ten years from 1988 to 1998, a 19%
growth rate compared to a 4% growth rate for all other
industries in New Jersey. These growth clusters grew
by
2.6% in 1999, over twice the rate of 1.2% for all
other
industries in New Jersey.

With strong labor market conditions, New Jersey's
personal income increased at a pace of 5.6% in 1999,
just below the 5.8% national rate. The strong New
Jersey
economy also led to a 7.0% growth in retail sales. Low
inflation, approximately 2%, continues to benefit New
Jersey consumers and businesses, and low interest
rates
have increased spending on housing and other consumers
durables. In 1999, home building was at its highest
level since 1988.

New Jersey's unemployment rate remained low in 1999 -
close to the national average. Joblessness, in terms
of
both absolute level and its rate, has been falling
steadily since its peak in 1992. The early trends in
year 2000 indicate that the number of unemployed
persons
in New Jersey has dropped to its lowest level since
mid-
1989.

The economic outlook for 2000/2001 is for continued
growth, but at somewhat more moderate rates.
Employment
is expected to increase by approximately 58,000 jobs,
reflecting a slowing national economy and shortages in
skilled technical specialties that will constrain job
growth. The outlook also indicates a slowing in New
Jersey personal income growth from 6.2% in 2000 to
5.9%
in 2001.

A slower growing national economy makes it
increasingly
unlikely that any changes in national economic or
fiscal
policy will be implemented that will impact New
Jersey's
economy significantly in the forecast period. However,
uncertainties in the international economy are likely
to
remain due to oil price and currency issues. Other
areas
of concern include the volatility in the stock market,
possible significant shifts in consumer and investor
confidence, unstable and potentially deflationary
international economic conditions, and the prospect of
leaner United States corporate profits. In addition,
the
restructuring of major industries will continue due to
cost containment, globalization of competition and
deregulation concerns. Although the forecasts for
2000/2001 contain more risks than in the recent past,
the basic fundamentals of New Jersey's economic health
remain favorable.

The New Jersey outlook is based on expected national
economic performance and on recent New Jersey
strategic
policy actions aimed at infrastructure improvements,
effective education and training of New Jersey's
workforce, and maintaining a competitive business
environment. Investments in each of these policy areas
are critical to maintaining the long-term health of
New
Jersey's economy.

To the extent that any adverse conditions exist in the
future that affect the ability of public agencies
within
New Jersey to pay debt service on their obligations,
the
value of the fund may be immediately and substantially
affected.

PUERTO RICO RISK FACTORS

Puerto Rico is a commonwealth of the United States.
Its
economy is based on manufacturing, services, and
tourism
and generally parallels the United States's economy.
Historically, Puerto Rico's economy benefited from tax
incentives contained in Section 936 of the Internal
Revenue Code.  These tax incentives allow tax credit
claims to U.S. domestic corporations that operate a
large amount of their business in Puerto Rico;
however,
these incentives will be phased out by the year 2006.
 This may decrease Puerto Rico's competitive advantage
for attracting new businesses in the future.  Economic
difficulties in the United States and natural
disasters
could have a negative on the overall economy of Puerto
Rico.

VIRGIN ISLANDS RISK FACTORS

The Virgin Islands are a self-governed territory of
the
United States and include St. Thomas, St. John and St.
Croix.  The islands are located in the Lesser
Antilles,
southeast of Florida.  The Virgin Islands' economy is
heavily dependent on tourism for both revenue and
employment.  Natural disasters and economic
difficulties
in the United States could have a negative impact on
the
tourism industry and may also have a negative impact
on
the overall economy of the Virgin Islands.

GUAM RISK FACTORS

Guam is a self-governed territory of the United States
located west-southwest of Hawaii and southeast of
Japan.
 Guam's economy is dependent on revenues from tourism,
the U.S. military and service industries.  Its
employment is concentrated in local government and
federal jobs.  A decrease in U.S. military operations
and natural disasters may have a negative impact on
Guam's economy.

PORTFOLIO TRANSACTIONS

Newly issued securities normally are purchased
directly
from the issuer or from an underwriter acting as
principal.  Other purchases and sales usually are
placed
with those dealers from which it appears that the best
price or execution will be obtained; those dealers may
be acting as either agents or principals.  The
purchase
price paid by the fund to underwriters of newly issued
securities usually includes a concession paid by the
issuer to the underwriter, and purchases of after-
market
securities from dealers normally are executed at a
price
between the bid and asked prices. For the 1999, 2000
and
2001 fiscal years, the fund has paid no brokerage
commissions.

Allocation of transactions, including their frequency,
to various dealers is determined by the manager in its
best judgment and in a manner deemed fair and
reasonable
to shareholders.  The primary considerations are
availability of the desired security and the prompt
execution of orders in an effective manner at the most
favorable prices.  Subject to these considerations,
dealers that provide supplemental investment research
and statistical or other services to the manager may
receive orders for portfolio transactions by the fund.
 Information so received is in addition to, and not in
lieu of, services required to be performed by the
manager, and the fees of the manager are not reduced
as
a consequence of its use of such supplemental
information.  Such information may be useful to the
manager in serving both the fund and other clients
and,
conversely, supplemental information obtained by the
placement of business of other clients may be useful
to
the manager in carrying out its obligations to the
fund.

The fund will not purchase Tax-Exempt Obligations
during
the existence of any underwriting or selling group
relating thereto of which Salomon Smith Barney is a
member, except to the extent permitted by the
Securities
and Exchange Commission ("SEC"). Under certain
circumstances, the fund may be at a disadvantage
because
of this limitation in comparison with other investment
companies which have a similar investment objective
but
which are not subject to such limitation.  The fund
also
may execute portfolio transactions through Salomon
Smith
Barney and its affiliates in accordance with rules
promulgated by the SEC.

While investment decisions for the fund are made
independently from those of the other accounts managed
by the manager, investments of the type the fund may
make also may be made by those other accounts.  When
the
fund and one or more other accounts managed by the
manager are prepared to invest in, or desire to
dispose
of, the same security, available investments or
opportunities for sales will be allocated in a manner
believed by the manager to be equitable to each. In
some
cases, this procedure may adversely affect the price
paid or received by the fund or the size of the
position
obtained or disposed of by the fund.

PORTFOLIO TURNOVER

The fund's portfolio turnover rate (the lesser of
purchases or sales of portfolio securities during the
year, excluding purchases or sales of short-term
securities, divided by the monthly average value of
portfolio securities) generally is not expected to
exceed 100%, but the portfolio turnover rate will not
be
a limiting factor whenever the fund deems it desirable
to sell or purchase securities. Securities may be sold
in anticipation of a rise in interest rates (market
decline) or purchased in anticipation of a decline in
interest rates (market rise) and later sold.  In
addition, a security may be sold and another security
of
comparable quality may be purchased at approximately
the
same time in order to take advantage of what the fund
believes to be a temporary disparity in the normal
yield
relationship between the two securities.  These yield
disparities may occur for reasons not directly related
to the investment quality of particular issues or the
general movement of interest rates, such as changes in
the overall demand for or supply of various types of
tax-exempt securities.  For the 2001 and 2000 fiscal
years, the fund's portfolio turnover rates were 18%
and
21%, respectively.

PURCHASE OF SHARES

Sales Charge Alternatives

The following classes of shares are available for
purchase.  See the prospectus for a discussion of
factors to consider in selecting which Class of shares
to purchase.

Class A Shares.  Class A shares are sold to investors
at
the public offering price, which is the net asset
value
plus an initial sales charge as follows:



Amount of
Investment

Sales Charge as
a %
Of Transaction

Sales Charge as
a %
of Amount
Invested
Dealers'
Reallowance as %
of Offering Price
Less than $25,000

4.00%

 4.17%

  3.60%
$ 25,000 - 49,999

3.50

 3.63

  3.15
50,000    99,999

3.00

 3.09

  2.70
100,000    249,999

2.50

 2.56

  2.25
250,000     499,999

1.50

 1.52

  1.35
500,000 or more

 *

    *
*

*  Purchases of Class A shares of $500,000 or more
will
be made at net asset value without any initial sales
charge, but will be subject to a deferred sales charge
of 1.00% on redemptions made within 12 months of
purchase. The deferred sales charge on Class A shares
is payable to Salomon Smith Barney, which compensates
Salomon Smith Barney Financial Consultants and other
dealers whose clients make purchases of $500,000 or
more. The deferred sales charge is waived in the same
circumstances in which the deferred sales charge
applicable to Class B and Class L shares is waived.

Members of the selling group may receive up to 90% of
the sales charge and may be deemed to be underwriters
of
the fund as defined in the 1933 Act.  The reduced
sales
charges shown above apply to the aggregate of
purchases
of Class A shares of the fund made at one time by "any
person," which includes an individual and his or her
immediate family, or a trustee or other fiduciary of a
single trust estate or single fiduciary account.

Class B Shares.  Class B shares are sold without an
initial sales charge but are subject to a deferred
sales
charge payable upon certain redemptions.  See
"Deferred
Sales Charge Provisions" section.

Class L Shares.  Class L shares are sold with an
initial
sales charge of 1.00% (which is equal to 1.01% of the
amount invested) and are subject to a deferred sales
charge payable upon certain redemptions.  See
"Deferred
Sales Charge Provisions" section. Until June 22, 2002
purchases of Class L shares by investors who were
holders of Class C shares of the fund and/or other
Smith
Barney mutual funds on June 12, 1998 will not be
subject
to the 1% initial sales charge.

Class Y Shares.  Class Y shares are sold without an
initial sales charge or deferred sales charge and are
available only to investors investing a minimum of
$15,000,000 (except purchases of Class Y shares by
Smith
Barney Allocation Series Inc., for which there is no
minimum purchase amount).

General

Investors may purchase shares from a Service Agent.
When
purchasing shares of the fund, investors must specify
whether the purchase is for Class A, Class B, Class L
or
Class Y shares.  Service Agents may charge their
customers an annual account maintenance fee in
connection with a brokerage account through which an
investor purchases or holds shares.  Accounts held
directly at the sub-transfer agent are not subject to
a
maintenance fee.

Investors in Class A, Class B and Class L shares may
open an account in the fund by making an initial
investment of at least $1,000 for each account, in the
fund. Investors in Class Y shares may open an account
by
making an initial investment of $15,000,000.
Subsequent
investments of at least $50 may be made for all
Classes.
For shareholders purchasing shares of the fund through
the Systematic Investment Plan on a monthly basis, the
minimum initial investment requirement for Class A,
Class B and Class L shares and subsequent investment
requirement for all Classes is $25. For shareholders
purchasing shares of the fund through the Systematic
Investment Plan on a quarterly basis, the minimum
initial investment required for Class A, Class B and
Class L shares and the subsequent investment
requirement
for all Classes is $50.  There are no minimum
investment
requirements for Class A shares for employees of
Citigroup including Salomon Smith Barney, unitholders
who invest distributions from a Unit Investment Trust
("UIT") sponsored by Salomon Smith Barney, and
Directors/Trustees of any of the Smith Barney mutual
funds, and their spouses and children. The fund
reserves
the right to waive or change minimums, to decline any
order to purchase its shares and to suspend the
offering
of shares from time to time. Shares purchased will be
held in the shareholder's account by the sub-transfer
agent.  Share certificates are issued only upon a
shareholder's written request to the sub-transfer
agent.
It is not recommended that the fund be used as a
vehicle
for Keogh, Individual Retirement Account or other
qualified retirement plans.

Purchase orders received by the fund or a Service
Agent
prior to the close of regular trading on the New York
Stock Exchange, Inc. (the "NYSE"), on any day the fund
calculates its net asset value, are priced according
to
the net asset value determined on that day (the
''trade
date'').  Orders received by a Service Agent prior to
the close of regular trading on the NYSE on any day
the
fund calculates its net asset value, are priced
according to the net asset value determined on that
day,
provided the order is received by the fund or the
fund's
agent prior to its close of business. For shares
purchased through Salomon Smith Barney or a Service
Agent purchasing through Salomon Smith Barney, payment
for shares of the fund is due on the third business
day
after the trade date. In all other cases, payment must
be made with the purchase order.

Systematic Investment Plan.  Shareholders may make
additions to their accounts at any time by purchasing
shares through a service known as the Systematic
Investment Plan.  Under the Systematic Investment
Plan,
Salomon Smith Barney or the sub-transfer agent is
authorized through preauthorized transfers of at least
$25 on a monthly basis or at least $50 on a quarterly
basis to charge the shareholder's account held with a
bank or other financial institution on a monthly or
quarterly basis as indicated by the shareholder, to
provide for systematic additions to the shareholder's
fund account. A shareholder who has insufficient funds
to complete the transfer will be charged a fee of up
to
$25 by Salomon Smith Barney or the sub-transfer agent.
 The Systematic Investment Plan also authorizes
Salomon
Smith Barney to apply cash held in the shareholder's
Salomon Smith Barney brokerage account or redeem the
shareholder's shares of a Smith Barney money market
fund
to make additions to the account. Additional
information
is available from the fund or a Service Agent.

Sales Charge Waivers and Reductions

Initial Sales Charge Waivers.  Purchases of Class A
shares may be made at net asset value without a sales
charge in the following circumstances: (a) sales to
(i)
board members and employees of Citigroup and its
subsidiaries and any Citigroup affiliated funds
including the Smith Barney mutual funds (including
retired board members and employees); the immediate
families of such persons (including the surviving
spouse
of a deceased board member or employee); and to a
pension, profit-sharing or other benefit plan for such
persons and (ii) employees of members of the National
Association of Securities Dealers, Inc., provided such
sales are made upon the assurance of the purchaser
that
the purchase is made for investment purposes and that
the securities will not be resold except through
redemption or repurchase; (b) offers of Class A shares
to any other investment company to effect the
combination of such company with the fund by merger,
acquisition of assets or otherwise; (c) purchases of
Class A shares by any client of a newly employed
Salomon
Smith Barney Financial Consultant (for a period up to
90
days from the commencement of the Financial
Consultant's
employment with Salomon Smith Barney), on the
condition
the purchase of Class A shares is made with the
proceeds
of the redemption of shares of a mutual fund which (i)
was sponsored by the Financial Consultant's prior
employer, (ii) was sold to the client by the Financial
Consultant and (iii) was subject to a sales charge;
(d)
purchases by shareholders who have redeemed Class A
shares in the fund (or Class A shares of another Smith
Barney mutual fund that is offered with a sales
charge)
and who wish to reinvest their redemption proceeds in
the fund, provided the reinvestment is made within 60
calendar days of the redemption; (e) purchases by
accounts managed by registered investment advisory
subsidiaries of Citigroup; (f) investments of
distributions from or proceeds from a sale of a UIT
sponsored by Salomon Smith Barney; and (g) purchases
by
investors participating in a Salomon Smith Barney fee-
based arrangement. In order to obtain such discounts,
the purchaser must provide sufficient information at
the
time of purchase to permit verification that the
purchase would qualify for the elimination of the
sales
charge.

Right of Accumulation.  Class A shares of the fund may
be purchased by ''any person'' (as defined above) at a
reduced sales charge or at net asset value determined
by
aggregating the dollar amount of the new purchase and
the total net asset value of all Class A shares of the
fund and of other Smith Barney mutual funds that are
offered with a sales charge as currently listed under
''Exchange Privilege'' then held by such person and
applying the sales charge applicable to such
aggregate.
 In order to obtain such discount, the purchaser must
provide sufficient information at the time of purchase
to permit verification that the purchase qualifies for
the reduced sales charge.  The right of accumulation
is
subject to modification or discontinuance at any time
with respect to all shares purchased thereafter.

Letter of Intent - Class A Shares.  A Letter of Intent
for an amount of $50,000 or more provides an
opportunity
for an investor to obtain a reduced sales charge by
aggregating investments over a 13 month period,
provided
that the investor refers to such Letter when placing
orders.  For purposes of a Letter of Intent, the
''Amount of Investment'' as referred to in the
preceding
sales charge table includes (i) all Class A shares of
the fund and other Smith Barney mutual funds offered
with a sales charge acquired during the term of the
letter plus (ii) the value of all Class A shares
previously purchased and still owned.  Each investment
made during the period receives the reduced sales
charge
applicable to the total amount of the investment goal.
 If the goal is not achieved within the period, the
investor must pay the difference between the sales
charges applicable to the purchases made and the
charges
previously paid, or an appropriate number of escrowed
shares will be redeemed.  The term of the Letter will
commence upon the date the Letter is signed, or at the
options of the investor, up to 90 days before such
date.
 Please contact a Service Agent or Citi Fiduciary
Trust
Company (the "transfer agent") to obtain a Letter of
Intent application.

Letter of Intent - Class Y Shares.  A Letter of Intent
may also be used as a way for investors to meet the
minimum investment requirement for Class Y shares
(except purchases of Class Y shares by Smith Barney
Allocation Series Inc., for which there is no minimum
purchase amount).  Such investors must make an initial
minimum purchase of $5,000,000 in Class Y shares of
the
fund and agree to purchase a total of $15,000,000 of
Class Y shares of the fund within 13 months from the
date of the Letter. If a total investment of
$15,000,000
is not made within the 13-month period, all Class Y
shares purchased to date will be transferred to Class
A
shares, where they will be subject to all fees
(including a service fee of 0.15%) and expenses
applicable to the fund's Class A shares, which may
include a deferred sales charge of 1.00%. Please
contact
a Service Agent or the transfer agent for further
information.

Deferred Sales Charge Provisions

''Deferred Sales Charge Shares'' are: (a) Class B
shares; (b) Class L shares; and (c) Class A shares
that
were purchased without an initial sales charge but are
subject to a deferred sales charge.  A deferred sales
charge may be imposed on certain redemptions of these
shares.

Any applicable deferred sales charge will be assessed
on
an amount equal to the lesser of the original cost of
the shares being redeemed or their net asset value at
the time of redemption. Deferred Sales Charge Shares
that are redeemed will not be subject to a deferred
sales charge to the extent the value of such shares
represents: (a) capital appreciation of fund assets;
(b)
reinvestment of dividends or capital gain
distributions;
(c) with respect to Class B shares, shares redeemed
more
than five years after their purchase; or (d) with
respect to Class L shares and Class A shares that are
Deferred Sales Charge Shares, shares redeemed more
than
12 months after their purchase.

Class L shares and Class A shares that are Deferred
Sales Charge Shares are subject to a 1.00% deferred
sales charge if redeemed within 12 months of purchase.
In circumstances in which the deferred sales charge is
imposed on Class B shares, the amount of the charge
will
depend on the number of years since the shareholder
made
the purchase payment from which the amount is being
redeemed.  Solely for purposes of determining the
number
of years since a purchase payment, all purchase
payments
made during a month will be aggregated and deemed to
have been made on the last day of the preceding
Salomon
Smith Barney statement month. The following table sets
forth the rates of the charge for redemptions of Class
B shares by shareholders.




Year Since Purchase Payment Was Made

Deferred sales charge

First

4.50%

Second

4.00

Third

3.00

Fourth

2.00

Fifth

1.00

Sixth and thereafter

0.00

Class B shares will convert automatically to Class A
shares eight years after the date on which they were
purchased and thereafter will no longer be subject to
any distribution fees. There will also be converted at
that time such proportion of Class B Dividend Shares
owned by the shareholder as the total number of his or
her Class B shares converting at the time bears to the
total number of outstanding Class B shares (other than
Class B Dividend Shares) owned by the shareholder.

In determining the applicability of any deferred sales
charge, it will be assumed that a redemption is made
first of shares representing capital appreciation,
next
of shares representing the reinvestment of dividends
and
capital gains distributions and finally of other
shares
held by the shareholder for the longest period of
time.
 The length of time Deferred Sales Charge Shares
acquired through an exchange have been held will be
calculated from the date the shares exchanged were
initially acquired in one of the other Smith Barney
mutual funds, and fund shares being redeemed will be
considered to represent, as applicable, capital
appreciation or dividend and capital gain distribution
reinvestments in such other funds. For federal income
tax purposes, the amount of the deferred sales charge
will reduce the gain or increase the loss, as the case
may be, on the amount realized on redemption. The
amount
of any deferred sales charge will be paid to Salomon
Smith Barney.

To provide an example, assume an investor purchased
100
Class B shares of the fund at $10 per share for a cost
of $1,000.  Subsequently, the investor acquired 5
additional shares of the fund through dividend
reinvestment.  During the fifteenth month after the
purchase, the investor decided to redeem $500 of his
or
her investment.  Assuming at the time of the
redemption
the net asset value had appreciated to $12 per share,
the value of the investor's shares would be $1,260
(105
shares at $12 per share). The deferred sales charge
would not be applied to the amount which represents
appreciation ($200) and the value of the reinvested
dividend shares ($60).  Therefore, $240 of the $500
redemption proceeds ($500 minus $260) would be charged
at a rate of 4.00% (the applicable rate for Class B
shares) for a total deferred sales charge of $9.60.

Waivers of Deferred Sales Charge

The deferred sales charge will be waived on: (a)
exchanges (see ''Exchange Privilege''); (b) automatic
cash withdrawals in amounts equal to or less than
1.00%
per month of the value of the shareholder's shares at
the time the withdrawal plan commences (see
''Automatic
Cash Withdrawal Plan'') (however, automatic cash
withdrawals in amounts equal to or less than 2.00% per
month of the value of the shareholder's shares will be
permitted for withdrawal plans established prior to
November 7, 1994); (c) redemptions of shares within 12
months following the death or disability of the
shareholder; (d) involuntary redemptions; and (e)
redemptions of shares to effect a combination of the
fund with any investment company by merger,
acquisition
of assets or otherwise. In addition, a shareholder who
has redeemed shares from other Smith Barney mutual
funds
may, under certain circumstances, reinvest all or part
of the redemption proceeds within 60 days and receive
pro rata credit for any deferred sales charge imposed
on
the prior redemption.

Deferred sales charge waivers will be granted subject
to
confirmation (by Salomon Smith Barney in the case of
shareholders who are also Salomon Smith Barney clients
or by the transfer agent in the case of all other
shareholders) of the shareholder's status or holdings,
as the case may be.

Volume Discounts

The schedule of sales charges on Class A shares
described in the prospectus applies to purchases made
by
any "purchaser," which is defined to include the
following: (a) an individual; (b) an individual's
spouse
and his or her children purchasing shares for their
own
account; (c) a trustee or other fiduciary purchasing
shares for a single trust estate or single fiduciary
account; and (d) a trustee or other professional
fiduciary (including a bank, or an investment adviser
registered with the SEC under the Investment Advisers
Act of 1940 purchasing shares of the fund for one or
more trust estates or fiduciary accounts.  Purchasers
who wish to combine purchase orders to take advantage
of
volume discounts on Class A shares should contact a
Service Agent.

DETERMINATION OF NET ASSET VALUE

Each class' net asset value per share is calculated on
each day, Monday through Friday, except days on which
the NYSE is closed.  The NYSE currently is scheduled
to
be closed on New Year's Day, Martin Luther King, Jr.
Day, Presidents' Day, Good Friday, Memorial Day,
Independence Day, Labor Day, Thanksgiving and
Christmas,
and on the preceding Friday or subsequent Monday when
one of these holidays falls on a Saturday or Sunday,
respectively.  Because of the differences in
distribution fees and class-specific expenses, the per
share net asset value of each class may differ.

Generally, the fund's investments are valued at market
value or, in the absence of a market value with
respect
to any securities, at fair value as determined by or
under the direction of the board of directors. A
security that is primarily traded on a domestic or
foreign exchange is valued at the last sale price on
that exchange or, if there were no sales during the
day,
at the mean between the bid and asked price. Over-the-
counter securities are valued at the mean between the
bid and asked price.  If market quotations for those
securities are not readily available, they are valued
at
fair value, as determined in good faith by the fund's
board of directors.  An option is generally valued at
the last sale price or, in the absence of a last sale
price, the last offer price.

U.S. government securities will be valued at the mean
between the closing bid and asked prices on each day,
or, if market quotations for those securities are not
readily available, at fair value, as determined in
good
faith by the fund's board of directors.

Short-term investments maturing in 60 days or less are
valued at amortized cost whenever the board of
directors
determines that amortized cost reflects fair value of
those investments. Amortized cost valuation involves
valuing an instrument at its cost initially and
thereafter assuming a constant amortization to
maturity
of any discount or premium, regardless of the effect
of
fluctuating interest rates on the market value of the
instrument.

All other securities and other assets of the fund will
be valued at fair value as determined in good faith by
the fund's board of directors.

Determination of Public Offering Price

The fund offers its shares to the public on a
continuous
basis. The public offering price per Class A and Class
Y share of the fund is equal to the net asset value
per
share at the time of purchase plus, for Class A
shares,
an initial sales charge based on the aggregate amount
of
the investment. The public offering price per Class B
and Class L share (and Class A share purchases,
including applicable rights of accumulation, equaling
or
exceeding $500,000) is equal to the net asset value
per
share at the time of purchase and no sales charge is
imposed at the time of purchase.  The method of
computing the public offering price is shown in the
fund's financial statements, incorporated by reference
in their entirety into this SAI.

REDEMPTION OF SHARES

The fund is required to redeem the shares of the fund
tendered to it, as described below, at a redemption
price equal to their net asset value per share next
determined after receipt of a written request in
proper
form at no charge other than any applicable deferred
sales charge. Redemption requests received after the
close of regular trading on the NYSE are priced at the
net asset value next determined.

If a shareholder holds shares in more than one Class,
any request for redemption must specify the Class
being
redeemed.  In the event of a failure to specify which
Class, or if the investor owns fewer shares of the
Class
than specified, the redemption request will be delayed
until the transfer agent receives further instructions
from Salomon Smith Barney, or if the shareholder's
account is not with Salomon Smith Barney, from the
shareholder directly.  The redemption proceeds will be
remitted on or before the third business day following
receipt of proper tender, except on any days on which
the NYSE is closed or as permitted under the 1940 Act
in
extraordinary circumstances. Generally, if the
redemption proceeds are remitted to a Salomon Smith
Barney brokerage account, these funds will not be
invested for the shareholder's benefit without
specific
instruction and Salomon Smith Barney will benefit from
the use of temporarily uninvested funds. Redemption
proceeds for shares purchased by check, other than a
certified or official bank check, will be remitted
upon
clearance of the check, which may take up to fifteen
days or more.

Shares held by Salomon Smith Barney as custodian must
be
redeemed by submitting a written request to a Salomon
Smith Barney Financial Consultant. Shares other than
those held by Salomon Smith Barney as custodian may be
redeemed through an investor's Service Agent or by
submitting a written request for redemption to:

Smith Barney New Jersey Municipals Fund Inc.
Class A, B, L or Y (please specify)
c/o PFPC Global Fund Services
	P.O. Box 9699
	Providence, RI 02940-9699

A written redemption request must (a) state the Class
and number or dollar amount of shares to be redeemed,
(b) identify the shareholder's account number and (c)
be
signed by each registered owner exactly as the shares
are registered. If the shares to be redeemed were
issued
in certificate form, the certificates must be endorsed
for transfer (or be accompanied by an endorsed stock
power) and must be submitted to the transfer agent
together with the redemption request. Any signature
appearing on a share certificate, stock power or
written
redemption request in excess of $50,000 must be
guaranteed by an eligible guarantor institution, such
as
a domestic bank, savings and loan institution,
domestic
credit union, member bank of the Federal Reserve
System
or member firm of a national securities exchange.
Written redemption requests of $50,000 or less do not
require a signature guarantee unless more than one
such
redemption request is made in any 10-day period.
Redemption proceeds will be mailed to an investor's
address of record. The transfer agent may require
additional supporting documents for redemptions made
by
corporations, executors, administrators, directors or
guardians. A redemption request will not be deemed
properly received until the transfer agent receives
all
required documents in proper form.

Telephone Redemption and Exchange Program.
Shareholders
who do not have a brokerage account may be eligible to
redeem and exchange shares by telephone. To determine
if
a shareholder is entitled to participate in this
program, he or she should contact the transfer agent
at
1-800-451-2010.  Once eligibility is confirmed, the
shareholder must complete and return a Telephone/Wire
Authorization Form, along with a signature guarantee,
that will be provided by the sub-transfer agent upon
request.  (Alternatively, an investor may authorize
telephone redemptions on the new account application
with the applicant's signature guarantee when making
his/her initial investment in a fund.)

Redemptions.   Redemption requests of up to $50,000 of
any class or classes of shares of a fund may be made
by
eligible shareholders by calling the transfer agent at
1-800-451-2010. Such requests may be made between 9:00
a.m. and 4:00 p.m. (Eastern time) on any day the NYSE
is
open.  Redemptions of shares (i) by retirement plans
or
(ii) for which certificates have been issued are not
permitted under this program.

A shareholder will have the option of having the
redemption proceeds mailed to his/her address of
record
or wired to a bank account predesignated by the
shareholder.  Generally, redemption proceeds will be
mailed or wired, as the case may be, on the next
business day following the redemption request.  In
order
to use the wire procedures, the bank receiving the
proceeds must be a member of the Federal Reserve
System
or have a correspondent relationship with a member
bank.
 The fund reserves the right to charge shareholders a
nominal fee for each wire redemption.  Such charges,
if
any, will be assessed against the shareholder's
account
from which shares were redeemed.  In order to change
the
bank account designated to receive redemption
proceeds,
a shareholder must complete a new Telephone/Wire
Authorization Form and, for the protection of the
shareholder's assets, will be required to provide a
signature guarantee and certain other documentation.

Exchanges.  Eligible shareholders may make exchanges
by
telephone if the account registration of the shares of
the fund being acquired is identical to the
registration
of the shares of the fund exchanged.  Such exchange
requests may be made by calling the transfer agent at
1-
800-451-2010 between 9:00 a.m. and 4:00 p.m. (Eastern
time) on any day on which the NYSE is open.

Additional Information Regarding Telephone Redemption
and Exchange Program.   Neither the fund nor its
agents
will be liable for following instructions communicated
by telephone that are reasonably believed to be
genuine.
 The fund and its agents will employ procedures
designed
to verify the identity of the caller and legitimacy of
instructions (for example, a shareholder's name and
account number will be required and phone calls may be
recorded).  The fund reserves the right to suspend,
modify or discontinue the telephone redemption and
exchange program or to impose a charge for this
service
at any time following at least seven (7) days' prior
notice to shareholders.

Redemptions in Kind.  In conformity with applicable
rules of the SEC, redemptions may be paid in portfolio
securities, in cash or any combination of both, as the
board of directors may deem advisable; however,
payments
shall be made wholly in cash unless the board of
directors believes economic conditions exist that
would
make such a practice detrimental to the best interests
of the fund and its remaining shareholders.  If a
redemption is paid in portfolio securities, such
securities will be valued in accordance with the
procedures described under "Determination of Net Asset
Value" in the Prospectus and a shareholder would incur
brokerage expenses if these securities were then
converted to cash.

Distributions in Kind

If the fund's board of directors determines that it
would be detrimental to the best interests of the
remaining shareholders of the fund to make a
redemption
payment wholly in cash, the fund may pay, in
accordance
with SEC rules, any portion of a redemption in excess
of
the lesser of $250,000 or 1.00% of the fund's net
assets
by a distribution in kind of portfolio securities in
lieu of cash. Securities issued as a distribution in
kind may incur brokerage commissions when shareholders
subsequently sell those securities.

Automatic Cash Withdrawal Plan

An automatic cash withdrawal plan (the "Withdrawal
Plan") is available to shareholders who own shares
with
a value of at least $10,000 and who wish to receive
specific amounts of cash monthly or quarterly.
Withdrawals of at least $50 may be made under the
Withdrawal Plan by redeeming as many shares of the
fund
as may be necessary to cover the stipulated withdrawal
payment. Any applicable deferred sales charge will not
be waived on amounts withdrawn by shareholders that
exceed 1.00% per month of the value of a shareholder's
shares at the time the Withdrawal Plan commences.
(With
respect to Withdrawal Plans in effect prior to
November
7, 1994, any applicable deferred sales charge will be
waived on amounts withdrawn that do not exceed 2.00%
per
month of the value of a shareholder's shares at the
time
the Withdrawal Plan commences.) To the extent
withdrawals exceed dividends, distributions and
appreciation of a shareholder's investment in the
fund,
there will be a reduction in the value of the
shareholder's investment, and continued withdrawal
payments will reduce the shareholder's investment and
may ultimately exhaust it. Withdrawal payments should
not be considered as income from investment in the
fund.
Furthermore, as it generally would not be advantageous
to a shareholder to make additional investments in the
fund at the same time he or she is participating in
the
Withdrawal Plan, purchases by such shareholder in
amounts of less than $5,000 ordinarily will not be
permitted.

Shareholders who wish to participate in the Withdrawal
Plan and who hold their shares in certificate form
must
deposit their share certificates with the sub-transfer
agent as agent for Withdrawal Plan members. All
dividends and distributions on shares in the
Withdrawal
Plan are reinvested automatically at net asset value
in
additional shares of the fund. For additional
information, shareholders should contact a Service
Agent
or the sub-transfer agent.  A shareholder who
purchases
shares directly through the sub-transfer agent may
continue to do so and applications for participation
in
the Withdrawal Plan must be received by the sub-
transfer
agent no later than the eighth day of the month to be
eligible for participation beginning with that month's
withdrawals.  For additional information, shareholders
should contact a Service Agent or the sub-transfer
agent.

The fund offers shareholders an automatic cash
withdrawal plan, under which shareholders who own
shares
with a value of at least $10,000 may elect to receive
cash payments of at least $50 monthly or quarterly.
The
withdrawal plan will be carried over on exchanges
between Classes of a fund.  Any applicable deferred
sales charge will not be waived on amounts withdrawn
by
a shareholder that exceed 1.00% per month of the value
of the shareholder's shares subject to the deferred
sales charge at the time the withdrawal plan
commences.
(With respect to withdrawal plans in effect prior to
November 7, 1994, any applicable deferred sales charge
will be waived on amounts withdrawn that do not exceed
2.00% per month of the value of the shareholder's
shares
subject to the deferred sales charge.)  For further
information regarding the automatic cash withdrawal
plan, shareholders should contact a Service Agent or
the
sub-transfer agent.


INVESTMENT MANAGEMENT AND OTHER SERVICES

Investment Adviser and Administrator - SBFM

SBFM serves as investment adviser to the fund pursuant
to an investment advisory agreement (the "Investment
Advisory Agreement") with the fund which was approved
by
the board of directors, including a majority of
directors who are not "interested persons" of the fund
or of SBFM.  SBFM is a wholly owned subsidiary of
Salomon Smith Barney Holdings Inc. ("Holdings"), which
in turn, is a wholly owned subsidiary of Citigroup.
Subject to the supervision and direction of the fund's
board of directors, SBFM manages the fund's portfolio
in
accordance with the fund's stated investment objective
and policies, makes investment decisions for the fund,
places orders to purchase and sell securities, and
employs professional portfolio managers and securities
analysts who provide research services to the fund.
SBFM
pays the salary of any officer and employee who is
employed by both it and the fund. SBFM bears all
expenses in connection with the performance of its
services.  SBFM (through its predecessor entities) has
been in the investment counseling business since 1968
and renders investment advice to investment company
clients that had aggregate assets under management as
of
 June 1, 2001 of approximately $195 billion.

As compensation for investment advisory services, the
fund pays the manager a fee computed daily and payable
monthly at 0.30% of the value of the fund's average
daily net assets.  For the fiscal years ended March
31,
1999, 2000 and 2001, the fund paid the manager net of
fee waivers and expense reimbursements, $722,522,
$672,124 and $604,870, respectively, in investment
advisory fees.

SBFM also serves as administrator to the fund pursuant
to a written agreement (the "Administration
Agreement").
 SBFM pays the salary of all officers and employees
who
are employed by both it and the fund and bears all
expenses in connection with the performance of its
services.  As administrator SBFM: (a) assists in
supervising all aspects of the fund's operations; b)
supplies the fund with office facilities (which may be
in SBFM's own offices), statistical and research data,
data processing services, clerical, accounting and
bookkeeping services, including, but not limited to,
the
calculation of (i) the net asset value of shares of
the
fund, (ii) applicable deferred sales charges and
similar
fees and charges and (iii) distribution fees, internal
auditing and legal services, internal executive and
administrative services, and stationary and office
supplies; and (c) prepares reports to shareholders of
the fund, tax returns and reports to and filings with
the SEC and state Blue Sky authorities.

As compensation for administrative services rendered
to
the fund, the manager receives a fee computed daily
and
payable monthly at the following annual rates of
average
daily net assets: 0.20% up to $500 million; and 0.18%
in
excess of $500 million.  For the fiscal years ended
March 31,  1999, 2000 and 2001 the fund paid the
manager
in administration fees $481,681, $448,083 and
$403,247,
respectively.

The fund bears expenses incurred in its operations
including: taxes, interest, brokerage fees and
commissions, if any; fees of directors of the fund who
are not officers, directors, shareholders or employees
of Salomon Smith Barney or the manager; SEC fees and
state Blue Sky notice fees; charges of custodians;
transfer and dividend disbursing agent's fees; certain
insurance premiums; outside auditing and legal
expenses;
costs of maintaining corporate existence; costs of
investor services (including allocated telephone and
personnel expenses); costs of preparing and printing
of
prospectuses for regulatory purposes and for
distribution to existing shareholders; costs of
shareholders' reports and shareholder meetings; and
meetings of the officers or board of directors of the
fund.

Code of Ethics

Pursuant to Rule 17j-1 of the 1940 Act, the fund, its
investment adviser and principal underwriter have
adopted a code of ethics that permits personnel to
invest in securities for their own accounts, including
securities that may be purchased or held by the fund.
 All personnel must place the interests of clients
first
and avoid activities, interests and relationships that
might interfere with the duty to make decisions in the
best interests of the clients.  All personal
securities
transactions by employees must adhere to the
requirements of the code and must be conducted in such
a manner as to avoid any actual or potential conflict
of
interest, the appearance of such a conflict, or the
abuse of an employee's position of trust and
responsibility.  A copy of the fund's Code of Ethics
is
on file with the SEC.

Counsel

Willkie Farr & Gallagher, 787 Seventh Avenue, New
York,
New York 10019, serves as counsel to the fund.

Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New
York, New York 10038, serves as counsel to the
directors
who are not "interested persons" of the fund.

Auditors

KPMG LLP, independent auditors, 757 Third Avenue, New
York, New York 10017, has been selected as the fund's
independent auditor to examine and report on the
fund's
financial statements for the fiscal year ending March
31, 2002.

Custodian, Transfer Agent and Sub-Transfer Agent

PFPC Trust Company, ("PFPC" or the "custodian")
located
at 8800 Tinicum Boulevard, Philadelphia, Pennsylvania
19153, serves as the custodian of the fund. Under the
custody agreement, the custodian holds the fund's
portfolio securities and keeps all necessary accounts
and records.  For its services, the custodian receives
a monthly fee based upon the month-end market value of
securities held in custody and also receives
securities
transaction charges.  The assets of the fund are held
under bank custodianship in compliance with the 1940
Act.

Citi Fiduciary Trust Company, (the "transfer agent")
located at 125 Broad Street, New York, New York 10004,
serves as the fund's transfer and dividend-paying
agent.
 Under the transfer agency agreement, the transfer
agent
maintains the shareholder account records for the
fund,
handles certain communications between shareholders
and
the fund, distributes dividends and distributions
payable by the fund and produces statements with
respect
to account activity for the fund and its shareholders.
 For these services, the transfer agent receives fees
from the fund computed on the basis of the number of
shareholder accounts that the transfer agent maintains
for the fund during the month and is reimbursed for
out-
of-pocket expenses.

PFPC Global Fund Services, located at Exchange Place,
Boston, Massachusetts 02109, serves as the fund's sub-
transfer agent.  Under the transfer agency agreement,
the sub-transfer agent maintains the shareholder
account
records for the fund, handles certain communications
between shareholders and the fund, and distributes
dividends and distributions payable by the fund.  For
these services, the sub-transfer agent receives a
monthly fee computed on the basis of the number of
shareholder accounts it maintains for the fund during
the month, and is reimbursed for out-of-pocket
expenses.

Distributor

Salomon Smith Barney, Inc. located at 388 Greenwich
Street, New York, New York 10013 serves as the fund's
distributor pursuant to a written agreement dated June
5, 2000 (the "Distribution Agreement") which was
approved by the fund's board of directors, including a
majority of the independent directors, on April 17,
2000
and July 12, 2000.  Prior to June 5, 2000, CFBDS, Inc.
("CFBDS") served as the fund's distributor.

For the period October 8, 1998 through March 31, 1999
the aggregate dollar amount of sales charges on Class
A
shares was $172,000, $154,800 of which was paid to
Salomon Smith Barney.  For the 2000 fiscal year, the
aggregate dollar amount of sales charges on Class A
shares was $144,000, of which $129,600 was paid to
Salomon Smith Barney.  For the 2001 fiscal year, the
aggregate dollar amount of sales charges on Class A
shares was $222,000, of which a portion was paid to
Salomon Smith Barney and CFBDS.

For the period October 8, 1998 through March 31, 1999
the aggregate dollar amount of sales charges on Class
L
shares was $14,000, $12,600 of which was paid to
Salomon
Smith Barney.  For the 2000 fiscal year, the aggregate
dollar amount of sales charges on Class L shares was
$25,000, of which $22,500 was paid to Salomon Smith
Barney.  For the 2001 fiscal year, the aggregate
dollar
amount of sales charges on Class L was $33,000, of
which
a portion was paid to Salomon Smith Barney and CFBDS.

For the fiscal years ended March 31, 1999, 2000 and
2001, Salomon Smith Barney or its predecessor received
from shareholders $51,000, $93,000 and $43,000,
respectively, in deferred sales charges on the
redemption of Class B shares.  For the fiscal years
ended March 31, 1999, 2000 and 2001, Salomon Smith
Barney or its predecessor received from shareholders
$2,000, $2,000 and $2,000, respectively, in deferred
sales charges on redemption of Class L shares.

When payment is made by the investor before the
settlement date, unless otherwise noted by the
investor,
the funds will be held as a free credit balance in the
investor's brokerage account and Salomon Smith Barney
may benefit from the temporary use of the funds.  The
fund's board of directors has been advised of the
benefits to Salomon Smith Barney resulting from these
settlement procedures and will take such benefits into
consideration when reviewing the Investment Advisory
Agreement for continuance.

Distribution Arrangements.  To compensate Salomon
Smith
Barney for the service it provides and for the expense
it bears, the fund has adopted a services and
distribution plan (the "Plan") pursuant to Rule 12b-1
under the 1940 Act.  Under the Plan, the fund pays
Salomon Smith Barney a service fee, accrued daily and
paid monthly, calculated at the annual rate of 0.15%
of
the value of the fund's average daily net assets
attributable to the Class A, Class B and Class L
shares.

In addition, the fund pays Salomon Smith Barney a
distribution fee with respect to Class B and Class L
shares primarily intended to compensate Salomon Smith
Barney for its initial expense of paying Financial
Consultants a commission upon sales of those shares.
The Class B and Class L distribution fee is calculated
at the annual rate of 0.50% and 0.55%, respectively,
of
the value of the fund's average net assets
attributable
to the shares of each Class.

For the fiscal year ended March 31, 2001, Salomon
Smith
Barney incurred distribution expenses totaling
$603,241,
consisting of $31,553 for advertising, $4,172 for
printing and mailing of prospectuses, $304,688 for
support services, $259,405 to Salomon Smith Barney
Financial Consultants, and $3,423 in accruals for
interest on the excess of Salomon Smith Barney
expenses
incurred in distributing the fund's shares over the
sum
of the distribution fees and deferred sales charge
received by Salomon Smith Barney from the fund.

The following service and distribution fees were
incurred pursuant to a Distribution Plan during the
periods indicated:





Distribution Plan Fees





Fiscal Year
Ended 3/31/01

Fiscal Year
Ended 3/31/00

Fiscal Year
Ended 3/31/99

Class A

$  209,241

$  228,500

$   248,265

Class B

$  341,798

$  404,862

$   440,192

Class L*

$    66,819

$    66,096

$     53,263

* Class L shares were called Class C shares until
June 12, 1998.

Under its terms, the Plan continues from year to year,
provided such continuance is approved annually by vote
of the board of directors, including a majority of the
independent directors.  The Plan may not be amended to
increase the amount of the service and distribution
fees
without shareholder approval, and all material
amendments of the Plan also must be approved by the
directors and independent directors in the manner
described above.  The Plan may be terminated with
respect to a Class of the fund at any time, without
penalty, by vote of a majority of the independent
directors or by a vote of a majority of the
outstanding
voting securities of the Class (as defined in the 1940
Act).  Pursuant to the Plan, Salomon Smith Barney will
provide the fund's board of directors with periodic
reports of amounts expended under the Plan and the
purpose for which such expenditures were made.


VALUATION OF SHARES

The fund's net asset value per share is determined as
of
the close of regular trading on the NYSE, on each day
that the NYSE is open, by dividing the value of the
fund's net assets attributable to each Class by the
total number of shares of that Class outstanding.

When, in the judgement of the pricing service, quoted
bid prices for investments are readily available and
are
representative of the bid side of the market, these
investments are valued at the mean between the quoted
bid and asked prices.  Investments for which, in the
judgment of the pricing service, there is no readily
obtainable market quotation (which may constitute a
majority of the portfolio securities) are carried at
fair value based on securities of similar type, yield
and maturity.  Pricing services generally determine
value by reference to transactions in municipal
obligations, quotations from municipal bond dealers,
market transactions in comparable securities and
various
relationships between securities.  Short-term
investments that mature in 60 days or less are valued
at
amortized cost whenever the board of directors
determines that amortized cost is or approximates fair
value. Amortized cost valuation involves valuing an
instrument at its cost initially and, thereafter,
assuming a constant amortization to maturity of any
discount or premium, regardless of the impact of
fluctuating interest rates on the market value of the
instrument.  Securities and other assets for which
market quotations are not readily available will be
valued in good faith at fair value by or under the
direction of the fund's board of directors.

EXCHANGE PRIVILEGE

Shares of each Class of the fund may be exchanged for
shares of the same Class of certain Smith Barney
mutual
funds, to the extent shares are offered for sale in
the
shareholder's state of residence. Exchanges of Class
A,
Class B and Class L shares are subject to minimum
investment requirements and all shares are subject to
the other requirements of the fund into which
exchanges
are made.

Class B Exchanges.  If a Class B shareholder wishes to
exchange all or a portion of his or her shares in any
of
the funds imposing a higher deferred sales charge than
that imposed by the fund, the exchanged Class B shares
will be subject to the higher applicable deferred
sales
charge. Upon an exchange, the new Class B shares will
be
deemed to have been purchased on the same date as the
Class B shares of the fund that have been exchanged.

Class L Exchanges.  Upon an exchange, the new Class L
shares will be deemed to have been purchased on the
same
date as the Class L shares of the fund that have been
exchanged.

Class A and Class Y Exchanges.  Class A and Class Y
shareholders of the fund who wish to exchange all or a
portion of their shares for shares of the respective
Class in any of the funds identified above may do so
without imposition of any charge.

Additional Information Regarding Exchanges.  The Fund
is
not designed to provide investors with a means of
speculation on short-term market movements.  A pattern
of frequent exchanges by investors can be disruptive
to
efficient portfolio management and, consequently, can
be
detrimental to the Fund and its shareholders.
Accordingly, if the Fund's management in its sole
discretion determines that an investor is engaged in
excessive trading, the Fund, with or without prior
notice, may temporarily or permanently terminate the
availability to that investor of Fund exchanges, or
reject in whole or part any purchase or exchange
request
with respect to such investor's account. Such
investors
also may be barred from purchases and exchanges
involving other funds in the Smith Barney Mutual Fund
family.   Accounts under common ownership or control
will be considered as one account for purposes of
determining a pattern of excessive trading. The Fund
may
notify an investor of rejection of a purchase or
exchange order after the day the order is placed.  If
an
exchange request is rejected, the Fund will take no
other action with respect to the shares until it
receives further instructions from the investor.  The
Fund's policy on excessive trading applies to
investors
who invest in the Fund directly or through Service
Agents, but does not apply to any systematic
investment
 plans described in the prospectus.

During times of drastic economic or market conditions,
the Fund may suspend the Exchange Privilege
temporarily
without notice and treat exchange requests based on
their separate components  redemption orders with a
simultaneous request to purchase the other fund's
shares.  In such a case, the redemption request would
be
processed at the Fund's next determined net asset
value
but the purchase order would be effective only at the
net asset value next determined after the fund being
purchased formally accepts the order, which may result
in the purchase being delayed.

PERFORMANCE DATA

From time to time, the fund may quote total return of
a
class in advertisements or in reports and other
communications to shareholders.  The fund may include
comparative performance information in advertising or
marketing the fund's shares.  Such performance
information may include data from the following
industry
and financial publications: Barron's, Business Week,
CDA
Investment Technologies, Inc., Changing Times, Forbes,
Fortune, Institutional Investor, Investor's Business
Daily, Money, Morningstar Mutual Fund Values, The New
York Times, USA Today and The Wall Street Journal.

Yield and Equivalent Taxable Yield

A Class' 30-day yield figure described below is
calculated according to a formula prescribed by the
SEC.
The formula can be expressed as follows:

YIELD =2 [(a-b +1)6-1]
						        cd

Where:	 a = dividends and interest earned during
the period.
		 b = expenses accrued for the period (net
of
reimbursement).
c = the average daily number of shares
outstanding during the period that were
entitled to receive dividends.
	 d = the maximum offering price per share
on the last day of the period.

For the purpose of determining the interest earned
(variable "a'' in the formula) on debt obligations
that
were purchased by the fund at a discount or premium,
the
formula generally calls for amortization of the
discount
or premium. The amortization schedule will be adjusted
monthly to reflect changes in the market values of the
debt obligations.

The fund's equivalent taxable 30-day yield for a Class
of shares is computed by dividing that portion of the
Class' 30-day yield which is tax-exempt by one minus a
stated income tax rate and adding the product to that
portion, if any, of the Class' yield that is not tax-
exempt.

The yields on municipal securities are dependent upon
a
variety of factors, including general economic and
monetary conditions, conditions of the municipal
securities market, size of a particular offering,
maturity of the obligation offered and rating of the
issue. Investors should recognize that in periods of
declining interest rates the fund's yield for each
Class
of shares will tend to be somewhat higher than
prevailing market rates, and in periods of rising
interest rates the fund's yield for each Class of
shares
will tend to be somewhat lower. Also, when interest
rates are falling, the inflow of net new money to the
fund from the continuous sale of its shares will
likely
be invested in portfolio instruments producing lower
yields than the balance of the fund's portfolio,
thereby
reducing the current yield of the fund. In periods of
rising interest rates, the opposite can be expected to
occur.


The fund's yield for Class A, Class B and Class L
shares
for the 30-day period ended March 31, 2001 was 4.58%,
4.18% and 4.08%, respectively.  The equivalent taxable
yield for Class A, Class B and Class L shares for that
same period was 9.32%, 8.51% and 8.31%, respectively,
assuming the payment of federal income taxes and New
Jersey taxes at a rate of 39.6% and 6.37%,
respectively.
 No yield information is present for Class Y shares
because no Class Y shares were outstanding for the 30-
day period ended March 31, 2001.


THE BALANCE OF THIS PAGE IS INTENTIONALLY LEFT BLANK.

Average Annual Total Return

"Average annual total return," as described below, is
computed according to a formula prescribed by the SEC.
 The formula can be expressed as follows:

	P (1+T)n = ERV

Where:		 	P = 	a hypothetical initial
payment of $1,000.
T = 	average annual total return.
N =	number of years.
ERV =	Ending Redeemable Value of a
hypothetical $1,000 investment
made at the beginning of a 1-,
5-, or 10-year period at the
end of a 1-, 5-, or 10-year
period (or fractional portion
thereof), assuming reinvestment
of all dividends and
distributions.

The ERV assumes complete redemption of the
hypothetical
investment at the end of the measuring period.  A
fund's
net investment income changes in response to
fluctuations in interest rates and the expenses of the
fund.


Average Annual Total Return for the
fiscal year ended March 31, 2001



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n1
Class A2
5.51%
4.40%
6.10%
6.97%
Class B3
4.88%
4.55%
N/A
5.27%
Class L4
7.17%
4.42%
N/A
5.93%
_______________________
	1	Class A, B,  L, and Y commenced operations
on
April 22, 1988, November 6, 1992, December 13,
1994 and November 7, 1994, respectively.
	2      The average annual total return figure
assumes
that the maximum 4.00% sales charge has been
deducted from the investment at the time of
purchase.  If the maximum sales charge or
deferred sales charge had not been deducted, the
average annual total return for Class A shares
for the same periods would have been 9.92%,
5.26%, 6.54% and 7.31% for one year, five year
and ten year and since inception of the fund,
respectively.
	3	The average annual total return figure
assumes
that the maximum applicable deferred sales charge
has been deducted from the investment at the time
of redemption.  If the maximum deferred sales
charge or deferred sales charge had not been
deducted, the average annual total return for
Class B shares for the same periods would have
been 9.38%, 4.72% and 5.27%, for the one year,
five year and since inception of the fund,
respectively.
	4	The average annual total return figure
assumes
that the maximum applicable initial and deferred
sales charges have been deducted from the
investment at the time of redemption.  If the
maximum initial and deferred sales charges had
not been deducted, the average annual total
return for Class L shares for the same periods
would have been 9.24%, 4.63% and 6.10% for one
year, five year and since inception of the fund,
respectively.

No average annual total return information is present
for Class Y shares because no Class Y shares were
outstanding for the periods presented for Class A, B
and
L shares.

Aggregate Total Return

"Aggregate total return" represents the cumulative
change in the value of an investment in the Class for
the specified period and is computed by the following
formula:

	ERV-P
	P

Where: 	P =	a hypothetical initial payment of
$10,000.
ERV=	Ending Redeemable Value of a
hypothetical $10,000 investment made
at the beginning of a 1-, 5-, or 10-
year period at the end of a 1-, 5-,
or 10-year period (or fractional
portion thereof), assuming
reinvestment of all dividends and
distributions.

The ERV assumes complete redemption of the
hypothetical
investment at the end of the measuring period.



Aggregate Annual Total Return for
the fiscal year ended March 31, 2001



Class of Shares
1-Year
5-Year
10-
Year
Since
Inceptio
n1
Class A2
5.51%
24.04%
80.80%
139.16%
Class B3
4.88%
24.95%
N/A%
  53.92%
Class L4
7.17%
24.16%
N/A
  43.72%
_______________________
	1	Class A, B,  L, and Y commenced operations
on
April 22, 1988, November 6, 1992, December 13,
1994 and November 7, 1994, respectively.
        2         The average annual total return
figure
assumes that the maximum 4.00% sales charge has
been deducted from the investment at the time of
purchase.  If the maximum sales charge or
deferred sales charge had not been deducted, the
average annual total return for Class A shares
for the same periods would have been 9.92%,
29.24%, 88.38% and 149.23% for one year, five
year and ten year and since inception of the
fund, respectively.
	3	The average annual total return figure
assumes
that the maximum applicable deferred sales charge
has been deducted from the investment at the time
of redemption.  If the maximum deferred sales
charge or deferred sales charge had not been
deducted, the average annual total return for
Class B shares for the same periods would have
been 9.32%, 25.91% and 53.92%, for the one year,
five year and since inception of the fund,
respectively.
	4	The average annual total return figure
assumes
that the maximum applicable initial and deferred
sales charges have been deducted from the
investment at the time of redemption.  If the
maximum initial and deferred sales charges had
not been deducted, the average annual total
return for Class L shares for the same periods
would have been 9.24%, 25.41% and 45.17% for one
year, five year and since inception of the fund,
respectively.

No aggregate total return information is presented for
Class Y shares because no Class Y shares were
outstanding for the periods presented for Class A, B
and
L shares.

Performance will vary from time to time depending on
market conditions, the composition of the fund's
portfolio and operating expenses and the expenses
exclusively attributable to the Class.  Consequently,
any given performance quotation should not be
considered
as representative of the Class' performance for any
specified period in the future.  Because performance
will vary, it may not provide a basis for comparing an
investment in the Class with certain bank deposits or
other investments that pay a fixed yield for a stated
period of time.  Investors comparing a Class'
performance with that of other mutual funds should
give
consideration to the quality and maturity of the
respective investment companies' portfolio securities.

It is important to note that the total return figures
set forth above are based on historical earnings and
are
not intended to indicate future performance.  Each
Class' net investment income changes in response to
fluctuations in interest rates and the expenses of the
fund.

DIVIDENDS, DISTRIBUTIONS AND TAXES

Dividends and Distributions.  The fund's policy is to
declare and pay exempt-interest dividends monthly.
Dividends from net realized capital gains, if any,
will
be distributed annually.  The fund may also pay
additional dividends shortly before December 31 from
certain amounts of undistributed ordinary income and
capital gains in order to avoid a federal excise tax
liability.  If a shareholder does not otherwise
instruct, exempt-interest dividends and capital gain
distributions will be reinvested automatically in
additional shares of the same Class at net asset
value,
with no additional sales charge or deferred sales
charge.

The per share amounts of the exempt-interest dividends
on Class B and Class L shares will be lower than on
Class A and Class Y shares, mainly as a result of the
distribution fees applicable to Class B and Class L
shares.  Similarly, the per share amounts of exempt-
interest dividends on Class A shares will be lower
than
on Class Y shares, as a result of the service fee
attributable to Class A shares.  Capital gain
distributions, if any, will be the same across all
Classes of fund shares (A, B, L and Y).

Taxes. The following is a summary of the material
federal income tax considerations regarding the
purchase, ownership and disposition of shares of the
fund.  Each prospective shareholder is urged to
consult
his own tax adviser with respect to the specific
federal, state and local consequences of investing in
the fund.  The summary is based on the laws in effect
on
the date of this SAI, which are subject to change.

The Fund and Its Investments

As described in the fund's prospectus, the fund is
designed to provide shareholders with current income
which is excluded from gross income for federal income
tax purposes and which is exempt from New Jersey
personal income taxes. The fund is not intended to
constitute a balanced investment program and is not
designed for investors seeking capital gains or
maximum
tax-exempt income irrespective of fluctuations in
principal.  Investment in the fund would not be
suitable
for tax-exempt institutions, qualified retirement
plans,
H.R. 10 plans and individual retirement accounts
because
such investors would not gain any additional tax
benefit
from the receipt of tax-exempt income.

The fund intends to continue to qualify to be treated
as
a regulated investment company each taxable year under
the Code.  To so qualify, the fund must, among other
things: (a) derive at least 90% of its gross income in
each taxable year from dividends, interest, payments
with respect to securities loans, and gains from the
sale or other disposition of stock or securities or
foreign currencies, or other income (including, but
not
limited to, gains from options, futures or forward
contracts) derived with respect to its business of
investing in such stock, securities or currencies; and
(b) diversify its holdings so that, at the end of each
quarter of the fund's taxable year, (i) at least 50%
of
the market value of the fund's assets is represented
by
cash, securities of other regulated investment
companies, United States government securities and
other
securities, with such other securities limited, in
respect of any one issuer, to an amount not greater
than
5% of the fund's assets and not greater than 10% of
the
outstanding voting securities of such issuer and (ii)
not more than 25% of the value of its assets is
invested
in the securities (other than United States government
securities or securities of other regulated investment
companies) of any one issuer or any two or more
issuers
that the fund controls and which are determined to be
engaged in the same or similar trades or businesses or
related trades or businesses.

As a regulated investment company, the fund will not
be
subject to federal income tax on its net investment
company income (i.e., taxable income other than any
excess of its net realized long-term capital gains
over
its net realized short-term capital losses ("net
realized capital gains")) and its net realized capital
gains, if any, that it distributes to its
shareholders,
provided that an amount equal to at least 90% of its
investment company taxable income, plus or minus
certain
other adjustments as specified in the Code, and 90% of
its net tax-exempt income for the taxable year is
distributed in compliance with the Code's timing and
other requirements but will be subject to tax at
regular
corporate rates on any taxable income or gains that it
does not distribute.

At March 31, 2001, the unused capital loss carryovers
of
the fund were approximately $4,497,000. For federal
income tax purposes, these amounts are available to be
applied against future realized capital gains, if any.
 The carryovers expire as follows:


March 31,
2008
March 31, 2009
Carryforward Amount
$1,315,000
$3,182,000

The Code imposes a 4% nondeductible excise tax on the
fund to the extent it does not distribute by the end
of
any calendar year at least 98% of its net investment
income for that year and 98% of the net amount of its
capital gains (both long-term and short-term) for the
one-year period ending, as a general rule, on October
31
of that year.  For this purpose, however, any income
or
gain retained by the fund that is subject to corporate
income tax will be considered to have been distributed
by year-end.  In addition, the minimum amounts that
must
be distributed in any year to avoid the excise tax
will
be increased or decreased to reflect any
underdistribution or overdistribution, as the case may
be, from the previous year.  The fund anticipates that
it will pay such dividends and will make such
distributions as are necessary in order to avoid the
application of this tax.

If, in any taxable year, the fund fails to qualify as
a
regulated investment company under the Code or fails
to
meet the distribution requirement, it would be taxed
in
the same manner as an ordinary corporation and
distributions to its shareholders would not be
deductible by the fund in computing its taxable
income.
 In addition, in the event of a failure to qualify,
the
fund's distributions, to the extent derived from the
fund's current or accumulated earnings and profits,
would constitute dividends (eligible for the corporate
dividends-received deduction) which are taxable to
shareholders as ordinary income, even though those
distributions might otherwise (at least in part) have
been treated in the shareholders' hands as tax-exempt
interest.  If the fund fails to qualify as a regulated
investment company in any year, it must pay out its
earnings and profits accumulated in that year in order
to qualify again as a regulated investment company.
In
addition, if the fund failed to qualify as a regulated
investment company for a period greater than one
taxable
year, the fund may be required to recognize any net
built-in gains with respect to certain of its assets
(the excess of the aggregate gains, including items of
income, over aggregate losses that would have been
realized if it had been liquidated) in order to
qualify
as a regulated investment company in a subsequent
year.

The fund's transactions in municipal bond index and
interest rate futures contracts and options on these
futures contracts (collectively, "section 1256
contracts") will be subject to special provisions of
the
Code (including provisions relating to "hedging
transactions" and "straddles") that, among other
things,
may affect the character of gains and losses realized
by
the fund (i.e., may affect whether gains or losses are
ordinary or capital), accelerate recognition of income
to the fund and defer fund losses. These rules could
therefore affect the character, amount and timing of
distributions to shareholders. These provisions also
(a)
will require the fund to mark-to-market certain types
of
the positions in its portfolio (i.e., treat them as if
they were closed out) and (b) may cause the fund to
recognize income without receiving cash with which to
pay dividends or make distributions in amounts
necessary
to satisfy the distribution requirements for avoiding
income and excise taxes.  The fund will monitor its
transactions, will make the appropriate tax elections
and will make the appropriate entries in its books and
records when it engages in these transactions in order
to mitigate the effect of these rules and prevent
disqualification of the fund as a regulated investment
company.

All section 1256 contracts held by the fund at the end
of its taxable year are required to be marked to their
market value, and any unrealized gain or loss on those
positions will be included in the fund's income as if
each position had been sold for its fair market value
at
the end of the taxable year.  The resulting gain or
loss
will be combined with any gain or loss realized by the
fund from positions in section 1256 contracts closed
during the taxable year.  Provided such positions were
held as capital assets and were not part of a "hedging
transaction" nor part of a "straddle," 60% of the
resulting net gain or loss will be treated as long-
term
capital gain or loss, and 40% of such net gain or loss
will be treated as short-term capital gain or loss,
regardless of the period of time the positions were
actually held by the fund.

Taxation of Shareholders

Because the fund will distribute exempt-interest
dividends, interest on indebtedness incurred by a
shareholder to purchase or carry fund shares is not
deductible for federal income tax purposes and New
Jersey personal income tax purposes.  If a shareholder
receives exempt-interest dividends with respect to any
share and if such share is held by the shareholder for
six months or less, then, for federal income tax
purposes, any loss on the sale or exchange of such
share
may, to the extent of exempt-interest dividends, be
disallowed.  In addition, the Code may require a
shareholder, if he or she receives exempt-interest
dividends, to treat as federal taxable income a
portion
of certain otherwise non-taxable social security and
railroad retirement benefit payments. Furthermore,
that
portion of any exempt-interest dividend paid by the
fund
which represents income derived from private activity
bonds held by the fund may not retain its federal tax-
exempt status in the hands of a shareholder who is a
"substantial user" of a facility financed by such
bonds
or a "related person" thereof.  Moreover, some or all
of
the fund's dividends may be a specific preference
item,
or a component of an adjustment item, for purposes of
the federal individual and corporate alternative
minimum
taxes.  In addition, the receipt of the fund's
dividends
and distributions may affect a foreign corporate
shareholder's federal "branch profits" tax liability
and
federal "excess net passive income" tax liability of a
shareholder of a Subchapter S corporation.
Shareholders
should consult their own tax advisors to determine
whether they are (a) substantial users with respect to
a facility or related to such users within the meaning
of the Code or (b) subject to a federal alternative
minimum tax, the federal branch profits tax or the
federal "excess net passive income" tax.

The fund does not expect to realize a significant
amount
of capital gains.  Net realized short-term capital
gains
are taxable to a United States shareholder as ordinary
income, whether paid in cash or in shares.
Distributions of net-long-term capital gains, if any,
that the fund designates as capital gains dividends
are
taxable as long-term capital gains, whether paid in
cash
or in shares and regardless of how long a shareholder
has held shares of the fund.

Upon the sale or exchange of his shares, a shareholder
will realize a taxable gain or loss equal to the
difference between the amount realized and his basis
in
his shares.  Such gain or loss will be treated as
capital gain or loss, if the shares are capital assets
in the shareholder's hands, and will be long-term
capital gain or loss if the shares are held for more
than one year and short-term capital gain or loss if
the
shares are held for one year or less.  Any loss
realized
on a sale or exchange will be disallowed to the extent
the shares disposed of are replaced, including
replacement through the reinvesting of dividends and
capital gains distributions in the fund, within a 61-
day
period beginning 30 days before and ending 30 days
after
the disposition of the shares. In such a case, the
basis
of the shares acquired will be increased to reflect
the
disallowed loss. Any loss realized by a shareholder on
the sale of a fund share held by the shareholder for
six
months or less (to the extent not disallowed pursuant
to
the six-month rule described above relating to exempt-
interest dividends) will be treated for federal income
tax purposes as a long-term capital loss to the extent
of any distributions or deemed distributions of long-
term capital gains received by the shareholder with
respect to such share.

If a shareholder incurs a sales charge in acquiring
shares of the fund, disposes of those shares within 90
days and then acquires shares in a mutual fund for
which
the otherwise applicable sales charge is reduced by
reason of a reinvestment right (e.g.,an exchange
privilege), the original sales charge will not be
taken
into account in computing gain or loss on the original
shares to the extent the subsequent sales charge is
reduced.  Instead, the disregarded portion of the
original sales charge will be added to the tax basis
in
the newly acquired shares.  Furthermore, the same rule
also applies to a disposition of the newly acquired
shares made within 90 days of the second acquisition.
 This provision prevents a shareholder from
immediately
deducting the sales charge by shifting his or her
investment in a family of mutual funds.

Backup Withholding.  The fund may be required to
withhold, for federal income tax purposes dividends,
distributions and redemption proceeds payable to
shareholders who fail to provide the fund with their
correct taxpayer identification number or to make
required certifications, or who have been notified by
the Internal Revenue Service ("IRS") that they are
subject to backup withholding. Certain shareholders
are
exempt from backup withholding.  Backup withholding is
not an additional tax and any amount withheld may be
credited against a shareholder's federal income tax
liabilities.

Notices.  Shareholders will be notified annually by
the
fund as to the federal income tax and New Jersey
personal income tax status of the dividends and
distributions made by the fund to its shareholders.
These statements also will designate the amount of
exempt-interest dividends that is a preference item
for
purposes of the federal individual and corporate
alternative minimum taxes.  The dollar amount of
dividends excluded or exempt from federal income
taxation and New Jersey personal income taxation and
the
dollar amount of dividends subject to federal income
taxation and New Jersey personal income taxation, if
any, will vary for each shareholder depending upon the
size and duration of such shareholder's investment in
the fund.  To the extent the fund earns taxable net
investment income, it intends to designate as taxable
dividends the same percentage of each day's dividend
as
its taxable net investment income bears to its total
net
investment income earned on that day.

The foregoing is only a summary of certain material
tax
consequences affecting the fund and its shareholders.
 Shareholders are advised to consult their own tax
advisers with respect to the particular tax
consequences
to them of an investment in the fund.

ADDITIONAL INFORMATION

The fund was incorporated under the laws of the State
of
Maryland on November 12, 1987 and is registered with
the
SEC as a non-diversified, open-end management
investment
company.  The fund commenced operations on April 22,
1988 under the name Shearson Lehman New Jersey
Municipals Inc.  On October 14, 1994, the fund changed
its name to Smith Barney New Jersey Municipals Fund
Inc.

Each Class of the fund represents an identical
interest
in the fund's investment portfolio.  As a result, the
Classes have the same rights, privileges and
preferences, except with respect to: (a) the
designation
of each Class; (b) the effect of the respective sales
charges for each Class; (c) the distribution and/or
service fees borne by each Class; (d) the expenses
allocable exclusively to each Class; (e) voting rights
on matters exclusively affecting a single Class; (f)
the
exchange privilege of each Class; and (g) the
conversion
feature of the Class B shares.  The board of directors
does not anticipate that there will be any conflicts
among the interests of the holders of the different
Classes. The directors, on an ongoing basis, will
consider whether any such conflict exists and, if so,
take appropriate action.

The fund does not hold annual shareholder meetings.
There normally will be no meetings of shareholders for
the purpose of electing directors unless and until
such
time as less than a majority of the directors holding
office have been elected by shareholders.  The
directors
will call a meeting for any purpose upon written
request
of shareholders holding at least 10% of the fund's
outstanding shares, and the fund will assist
shareholders in calling such a meeting as required by
the 1940 Act. When matters are submitted for
shareholder
vote, shareholders of each Class will have on vote for
each full share owned and proportionate, fractional
vote
for any fractional share held of that Class.
Generally,
shares of the fund will be voted on a fund-wide basis
on
all matters except matters affecting only the
interests
of one Class.

The fund sends to each of its shareholders a semi-
annual
report and an audited annual report, which include
listings of the investment securities held by the fund
at the end of the reporting period.  In an effort to
reduce the fund's printing and mailing costs, the fund
plans to consolidate the mailing of its semi-annual
and
annual reports by household.  This consolidation means
that a household having multiple accounts with the
identical address of record will receive a single copy
of each report.  Shareholders who do not want this
consolidation to apply to their account should contact
their Service Agent or the transfer agent.

FINANCIAL STATEMENTS

The fund's annual report for the fiscal year ended
March
31, 2001 was filed on June 8, 2001 and is incorporated
by reference in its entirety, Accession Number
00000950130-01-502252.

OTHER INFORMATION

In an industry where the average portfolio manager has
seven years of experience (source: ICI, 1998), the
portfolio managers of Smith Barney mutual funds
average
21 years in the industry and 15 years with the firm.

Smith Barney mutual funds offers more than 60 mutual
funds.  We understand that many investors prefer an
active role in allocating the mix of funds in their
portfolio, while others want the asset allocation
decisions to be made by experienced managers.

That's why we offer five "styles" of fund management
that can be tailored to suit each investor's unique
financial goals.

Classic Investor Series  our portfolio manager driven
funds
The Classic Series lets investors participate in
mutual
funds whose investment decisions are determined by
experienced portfolio managers, based on each fund's
investment objectives and guidelines.  Classic Series
funds invest across asset classes and sectors,
utilizing
a range of strategies in order to achieve their
objectives.

Index Series  funds that track the market
Our Index funds are designed to provide investment
results that track, as closely as possible, the
performance of a stock or bond market index.  This
strategy distinguishes an index fund from an "actively
managed" mutual fund.  Instead of trying to outperform
a market or segment, a portfolio manager looks to an
index to determine which securities the fund should
own.


Premier Selections Series  our best ideas,
concentrated
funds
We offer a series of Premier Selections funds managed
by
several of our most experienced and proven managers.
This series of funds is built on a unique strategy of
combining complementary investment management styles
to
create broader, multiclass and multicap products that
are distinguished by a highly concentrated focus.

Research Series  driven by exhaustive fundamental
securities analysis
Built on a foundation of substantial buy-side research
under the direction of our Citibank Global Asset
Management (CGAM) colleagues, our Research funds focus
on well-defined industries, sectors and trends.

Style Pure Series  our solution to funds that stray
Our Style Pure Series funds are the building blocks of
asset allocation.  The funds stay fully invested
within
their asset class and investment style, enabling you
to
make asset allocation decisions in conjuction with
your
financial professional.



APPENDIX A

Description of S&P and Moody's ratings:

S&P Ratings for Municipal Bonds

S&P's Municipal Bond ratings cover obligations of
states
and political subdivisions.  Ratings are assigned to
general obligation and revenue bonds.  General
obligation bonds are usually secured by all resources
available to the municipality and the factors outlined
in the rating definitions below are weighed in
determining the rating.  Because revenue bonds in
general are payable from specifically pledged
revenues,
the essential element in the security for a revenue
bond
is the quantity and quality of the pledged revenues
available to pay debt service.

Although an appraisal of most of the same factors that
bear on the quality of general obligation bond credit
is
usually appropriate in the rating analysis of a
revenue
bond, other factors are important, including
particularly the competitive position of the municipal
enterprise under review and the basic security
covenants.  Although a rating reflects S&P's judgment
as
to the issuer's capacity for the timely payment of
debt
service, in certain instances it may also reflect a
mechanism or procedure for an assured and prompt cure
of
a default, should one occur, i.e., an insurance
program,
federal or state guarantee or the automatic
withholding
and use of state aid to pay the defaulted debt
service.

	AAA

Prime - These are obligations of the highest quality.
 They have the strongest capacity for timely payment
of
debt service.

General Obligation Bonds - In a period of economic
stress, the issuers will suffer the smallest declines
in
income and will be least susceptible to autonomous
decline.  Debt burden is moderate. A strong revenue
structure appears more than adequate to meet future
expenditure requirements.  Quality of management
appears
superior.

Revenue Bonds - Debt service coverage has been, and is
expected to remain, substantial.  Stability of the
pledged revenues is also exceptionally strong, due to
the competitive position of the municipal enterprise
or
to the nature of the revenues.  Basic security
provisions (including rate covenant, earnings test for
issuance of additional bonds, and debt service reserve
requirements) are rigorous. There is evidence of
superior management.

	AA

High Grade - The investment characteristics of general
obligation and revenue bonds in this group are only
slightly less marked than those of the prime quality
issues.  Bonds rated "AA'' have the second strongest
capacity for payment of debt service.



A

Good Grade - Principal and interest payments on bonds
in
this category are regarded as safe.  This rating
describes the third strongest capacity for payment of
debt service.  It differs from the two higher ratings
because:

General Obligation Bonds - There is some weakness,
either in the local economic base, in debt burden, in
the balance between revenues and expenditures, or in
quality of management.  Under certain adverse
circumstances, any one such weakness might impair the
ability of the issuer to meet debt obligations at some
future date.

Revenue Bonds - Debt service coverage is good, but not
exceptional.  Stability of the pledged revenues could
show some variations because of increased competition
or
economic influences on revenues.  Basic security
provisions, while satisfactory, are less stringent.
Management performance appears adequate.

	BBB

Medium Grade - Of the investment grade ratings, this
is
the lowest.

General Obligation Bonds - Under certain adverse
conditions, several of the above factors could
contribute to a lesser capacity for payment of debt
service.  The difference between "A'' and "BBB"
ratings
is that the latter shows more than one fundamental
weakness, or one very substantial fundamental
weakness,
whereas the former shows only one deficiency among the
factors considered.

Revenue Bonds - Debt coverage is only fair.  Stability
of the pledged revenues could show substantial
variations, with the revenue flow possibly being
subject
to erosion over time.  Basic security provisions are
no
more than adequate.  Management performance could be
stronger.

	BB, B, CCC and CC

Bonds rated BB, B, CCC and CC are regarded, on
balance,
as predominately speculative with respect to capacity
to
pay interest and repay principal in accordance with
the
terms of the obligation.  BB indicates the lowest
degree
of speculation and CC the highest degree of
speculation.
 While such bonds will likely have some quality and
protective characteristics, these are outweighed by
large uncertainties or major risk exposures to adverse
conditions.

	C

The rating C is reserved for income bonds on which no
interest is being paid.





	D

Bonds rated D are in default, and payment of interest
and/or repayment of principal is in arrears.

S&P's letter ratings may be modified by the addition
of
a plus or a minus sign, which is used to show relative
standing within the major rating categories, except in
the AAA-Prime Grade category.

S&P Ratings for Municipal Notes

Municipal notes with maturities of three years or less
are usually given note ratings (designated SP-1, -2 or
-3) by S&P to distinguish more clearly the credit
quality of notes as compared to bonds.  Notes rated
SP-1
have a very strong or strong capacity to pay principal
and interest.  Those issues determined to possess
overwhelming safety characteristics are given the
designation of SP-1+.  Notes rated SP-2 have a
satisfactory capacity to pay principal and interest.

Moody's Ratings for Municipal Bonds

	Aaa

Bonds that are Aaa are judged to be of the best
quality.
 They carry the smallest degree of investment risk and
are generally referred to as "gilt edge.'' Interest
payments are protected by a large or by an
exceptionally
stable margin and principal is secure.  While the
various protective elements are likely to change, such
changes as can be visualized are most unlikely to
impair
the fundamentally strong position of such issues.

	Aa

Bonds that are rated Aa are judged to be of high
quality
by all standards.  Together with the Aaa group they
comprise what are generally known as high grade bonds.
 They are rated lower than the best bonds because
margins of protection may not be as large as in Aaa
securities or fluctuation of protective elements may
be
of greater amplitude or there may be other elements
present which make the long-term risks appear somewhat
larger than in Aaa securities.

	A

Bonds that are rated A possess many favorable
investment
attributes and are to be considered as upper medium-
grade obligations.  Factors giving security to
principal
and interest are considered adequate, but elements may
be present which suggest a susceptibility to
impairment
sometime in the future.

	Baa

Bonds that are rated Baa are considered as medium-
grade
obligations, i.e., they are neither highly protected
nor
poorly secured; interest payments and principal
security
appear adequate for the present but certain protective
elements may be lacking or may be characteristically
unreliable over any great length of time.  Such bonds
lack outstanding investment characteristics and in
fact
have speculative characteristics as well.

	Ba

Bonds that are rated Ba are judged to have speculative
elements; their future cannot be considered as well
assured.  Often the protection of interest and
principal
payments may be very moderate and thereby not well
safeguarded during both good and bad times over the
future.  Uncertainty of position characterizes bonds
in
this class.

	B

Bonds that are rated B generally lack characteristics
of
the desirable investment.  Assurance of interest and
principal payments or of maintenance of other terms of
the contract over any long period of time may be
small.

	Caa

Bonds that are rated Caa are of poor standing.  These
issues may be in default or present elements of danger
may exist with respect to principal or interest.

	Ca

Bonds that are rated Ca represent obligations that are
speculative in a high degree.  These issues are often
in
default or have other marked short-comings.

	C

Bonds that are rated C are the lowest rated class of
bonds, and issues so rated can be regarded as having
extremely poor prospects of ever attaining any real
investment standing.

Moody's Ratings for Municipal Notes

Moody's ratings for state and municipal notes and
other
short-term loans are designated Moody's Investment
Grade
(MIG) and for variable rate demand obligations are
designated Variable Moody's Investment Grade (VMIG).
This distinction is in recognition of the differences
between short- and long-term credit risk.  Loans
bearing
the designation MIG 1 or VMIG 1 are of the best
quality,
enjoying strong protection by established cash flows
of
funds for their servicing, from established and broad-
based access to the market for refinancing, or both.
Loans bearing the designation MIG 2 or VMIG 2 are of
high quality, with margins of protection ample
although
not as large as the preceding group.  Loans bearing
the
designation MIG 3 or VMIG 3 are of favorable quality,
with all security elements accounted for but lacking
the
undeniable strength of the preceding grades.
Liquidity
and cash flow may be narrow and market access for
refinancing is likely to be less well established.



SMITH BARNEY NEW JERSEY MUNICIPALS FUND INC.



Statement of


Additional
Information























July 30, 2001




Smith Barney New Jersey Municipals Fund Inc.
7 World Trade Center
New York, NY  10048

	SALOMON
SMITH BARNEY

	A Member
of Citigroup [Symbol]
 Language taken from CAMU SAI


45





Part C-Other Information

Item 23.Exhibits

All references are to the Registrant's Registration
Statement on Form N-1A as filed with the Securities and
Exchange Commission on December 1, 1987.  File Nos. 33-
18779 and 811-5486  (the "Registration Statement").

(a)(1)	Registrant's Articles of Incorporation
dated November 12, 1987, Articles of
Amendment dated December 15, 1988 to
Articles of Incorporation, Articles of
Revival dated March 31, 1992 to Articles of
Incorporation, Articles Supplementary dated
November 5, 1992 to Articles of
Incorporation, and Articles of Amendment
dated July 30, 1993, to Articles of
Incorporation are incorporated by reference
to Post-Effective Amendment No. 12 to the
Registration Statement filed on August 1,
1994 ("Post-Effective Amendment No. 12").

(a)(2)	Form of Articles of Amendment dated October
14, 1994 to the Articles of Incorporation
are incorporated by reference to Post-
Effective Amendment No. 13 to the
Registration Statement filed on November 7,
1994 (Post-Effective Amendment No. 13).

(a)(3)	Form of Articles Supplementary and Form of
Articles of Amendment dated November 7,
1994 to the Articles of Incorporation are
incorporated by reference to Post-Effective
Amendment No. 13.

(a)(4)	Articles of Amendment dated June 1, 1998
of the Articles of Incorporation is
incorporated by reference to Post-
Effective Amendment No. 19 to the
Registration Statement filed on May 25,
1999 ("Post-Effective Amendment No. 19").

(b)(1)	Registrant's By-Laws dated November 23,
1987 are incorporated by reference to the
Registration Statement.

(c)(1)	Registrant's form of stock certificate is
incorporated by reference to Post-Effective
Amendment No. 9 to the Registration
Statement filed on October 23, 1992 (Post-
Effective Amendment No. 9).

(d)(1)	Investment Advisory Agreement dated July
30, 1993 between the Registrant and
Greenwich Street Advisors is incorporated
by reference to Post-Effective Amendment
No. 12.

(d)(2)	Form of Transfer of Investment Advisory
Agreement dated as of November 7, 1994,
among  Registrant, Mutual Management Corp.
and SBMFM is incorporated by reference to
Post-Effective Amendment No. 14 to the
Registration Statement filed on June 2,
1995 ("Post-Effective Amendment No. 14").

(e)(1)		Form of Distribution Agreement dated July
30, 1993 between the Registrant and Smith
Barney Shearson Inc. is incorporated by
reference to Post-Effective Amendment No.
12.

(e)(2)      Distribution Agreement between CFBDS, Inc.
and the Registrant
dated October 8, 1998 is incorporated by
reference to Post-Effective Amendment No.
19.


(e)(3)	Form of Distribution Agreement with
Salomon Smith Barney Inc. is incorporated
by reference to Post-Effective Amendment
No. 22 to the Registration Statement filed
on July 28, 2000 ("Post-Effective
Amendment No. 22").

(e)(4)		Selling Group Agreement is incorporated by
reference to Post-Effective Amendment No.
19.

(e)(5)	Form of Distribution Agreement with Salomon
Smith Barney is
		filed herein.


(f)		Not Applicable.

(g)(1)	Custody Agreement dated June 12, 1995
between the Registrant and PNC Bank,
National Association is incorporated by
reference to Post-Effective Amendment No.
16.

(h)(1)	Transfer Agency Agreement dated August 2,
1993 between the Registrant and The
Shareholder Services Group, Inc. is
incorporated by reference to Post-Effective
Amendment No. 12.

(h)(2)	Transfer Agency Agreement dated October 1,
1999 between the Registrant and Smith
Barney Private Trust Company is
incorporated by reference to Post-Effective
Amendment No. 22.

(h)(3)	Sub-Transfer Agency Agreement dated October
1, 1999 between the First Data Investor
Services Group Inc. and Smith Barney
Private Trust Company is incorporated by
reference to Post-Effective Amendment No.
22.

(h)(4)	Form of Administration Agreement dated
April 20, 1994 between the Registrant and
Smith, Barney Advisers, Inc. ("SBA") is
incorporated by reference to Post-Effective
Amendment No. 13.

(h)(5)		Transfer Agency Agreement with Citi
Fiduciary Trust Company 	is filed herein.

(h)(6)		Sub-Transfer Agency Agreement with PFPC
Global Fund Services is filed herein.


(i)(1)		Opinion of Counsel as to Legality of
Securities being Offered is incorporated by
reference to Post-Effective Amendment No.
14.

(j)(1)	Auditor's consent is filed herein.

(k)(1)	Not Applicable.

(l)		Not Applicable.

(m)(1)	Amended and Restated Services and
Distribution Plan pursuant to Rule 12b-1
dated as of November 7, 1994 is
incorporated by reference to Post-Effective
Amendment No. 13.

(m)(2)	Form of Amended Service and Distribution
Plan pursuant to Rule 12b-1 between the
Registrant and Salomon Smith Barney Inc. is
incorporated by reference to Post-Effective
Amendment No. 19.

(n)(1)	Not Applicable.

(o)(1)	Form of Rule 18f-3(d) Multiple Class Plan
of the Registrant is incorporated by
reference to Post-Effective Amendment No.
15 to the Registration Statement filed on
March 28, 1996.

(o)(2)	Form of Registrant's Rule 18f-3(d) Multiple
Class Plan is incorporated by reference to
Post-Effective Amendment No. 19.


(p)		Code of Ethics is incorporated by reference
to Post-Effective Amendment No. 22.



Item 24.	Persons Controlled by or Under Common
Control with Registrant

	  None.

Item 25.	Indemnification

		Response to this item is incorporated by
reference to Post-Effective Amendment No.
9.

Item 26.	Business and Other Connections of
Investment Adviser


Investment Adviser -Smith Barney Fund Management LLC
(formerly known as SSB Citi Fund Management LLC)
("SBMF").  SBMF was incorporated in December 1968
under the laws of the State of Delaware and converted
to a Delaware limited liability company on September
21, 1999.  SBMF is a wholly owned subsidiary of
Salomon Smith Barney Holdings Inc., which in turn is a
wholly owned subsidiary of Citigroup Inc.

SBMF is registered as an investment adviser under the
Investment Advisers Act of 1940.  The list required by
this item 26 of officers and directors of SBMF
together with information as to any other business,
profession, vocation or employment of a substantial
nature engaged in by such officers and directors
during the past two years, is incorporated by
reference to Schedules A and D of Form ADV filed by
Smith Barney Fund Management pursuant to the
Investment Advisers Act of 1940 (SEC File No. 801-
8314).




Item 27.  Principal Underwriters

(a) Salomon Smith Barney, Inc. ("Salomon Smith Barney")
the
Registrant's Distributor, is also the distributor for
the following
Smith Barney funds: Smith Barney
Investment Series, Consulting Group Capital Markets
Funds, Greenwich
Street Series Fund, Smith Barney Adjustable Rate
Government Income
Fund, Smith Barney Aggressive Growth Fund Inc., Smith
Barney
Appreciation Fund Inc., Smith Barney Arizona
Municipals Fund Inc.,
Smith Barney California Municipals Fund Inc., Smith
Barney
Allocation Series Inc., Smith Barney Equity Funds,
Smith Barney
Fundamental Value Fund Inc., Smith Barney Funds, Inc.,
Smith Barney
Income Funds, Smith Barney Institutional Cash
Management Fund, Inc.,
Smith Barney Investment Funds Inc., Smith Barney
Investment Trust,
Smith Barney Managed Governments Fund Inc., Smith
Barney Managed
Municipals Fund Inc., Smith Barney Massachusetts
Municipals Fund,
Smith Barney Money Funds, Inc., Smith Barney Muni
Funds, Smith Barney
Municipal Money Market Fund, Inc., Smith Barney
Sector Series Inc., Smith Barney Oregon Municipals
Fund Inc., Smith Barney Principal Return Fund, Smith
Barney Small Cap Core Fund, Inc., Smith Barney
Telecommunications Trust, Smith Barney Variable
Account Funds, Smith Barney World Funds, Inc.,
Travelers Series Fund Inc., and
various series of unit investment trusts.

PFS Distributors, Inc., ("PFS Distributors"),
a Distributor of the Registrant, is also a distributor
for the
following Smith Barney funds:

Smith Barney Investment Series,
Smith Barney Aggressive Growth Fund Inc.,
Smith Barney Appreciation Fund Inc.,
Smith Barney Allocation Series Inc.,
Smith Barney Equity Funds,
Smith Barney Fundamental Value Fund Inc.,
Smith Barney Income Funds,
Smith Barney Investment Funds Inc.,
Smith Barney Investment Trust,
Smith Barney Managed Municipals Fund Inc.,
Smith Barney Money Funds, Inc.
Smith Barney Sector Series Inc.

In addition, Salomon Smith Barney is also the
distributor for the Centurion Funds, Inc.

(b)	The information required by this Item 27 with
respect to each
director and officer of Salomon Smith Barney is
incorporated by reference to
Schedule A of Form BD filed by Salomon Smith Barney
pursuant to the Securities and
Exchange Act of 1934 (SEC File No. 812-8510).

The information required by this Item 27 with respect
to each director, officer and partner of PFS
Distributors
is incorporated by reference to Schedule A of Form BD
filed by PFS Distributors  pursuant to the Securities
Exchange Act of 1934 (SEC File No. 8-37352).

(c)	Not applicable.

Item 28.	Location of Accountants and Records

(1) With respect to the Registrant's
Investment Adviser and Administrator :
C/o Smith Barney Fund Management LLC.
Smith Barney New Jersey Municipals Fund
Inc.
		7 World Trade Center, 39th Floor
		New York, New York 10048

(2) With respect to the Registrant's
Custodian:
PFPC Trust Copmany
8800 Tinicum Boulevard
		Philadelphia, Pennsylvania  19153

(3) With Respect to the Registrant's Transfer
Agent:
Citi Fiduciary Trust Company
125 Broad Street
		New York, New York 10004

(4) With respect to the Registrant's Sub-
Transfer Agent:
PFPC Global Fund Services.
		P.O. Box 9699
		Providence, Rhode Island 02940

(5) With respect to the Registrant's
Distributor:
Salomon Smith Barney Inc.
388 Greenwich Street
New York, New York 10013

Item 29.	Management Services

		Not Applicable.

Item 30.	Undertakings
		None


SIGNATURES

	Pursuant to the requirements of the Securities
Act of 1933 (the "Securities Act") and the Investment
Company Act of 1940, as amended, the Registrant, Smith
Barney New Jersey Municipals Fund Inc. certifies that
it meets all of the requirements for effectiveness of
this registration statement under rule 485(b) under
the Securities Act has duly caused this Registration
Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of
New York and State of New York, on the 24th day of
July, 2001.


SMITH BARNEY NEW
JERSEY MUNICIPALS FUND
INC.



By: /s/ Heath B.
McLendon
     Health B.
McLendon
     Chairman of the
Board,
     President and
Chief Executive
Officer

	Pursuant to the requirements of the Securities
Act of 1933, as amended, this Amendment to the
Registration Statement has been signed below by the
following persons in the capacities and as of the
dates indicated.

Signature           Title          	Date

/s/Heath B. McLendon     Chairman of the Board,
July 24, 2001
Heath B. McLendon        President and Chief
                         Executive Officer

/s/ Lewis E. Daidone      Senior Vice President and
July 24, 2001
Lewis E. Daidone          Treasurer, Chief Financial
                          and Accounting Officer


/s/Herbert Barg*     Director      	July 24, 2001
Herbert Barg


/s/Alfred J. Bianchetti*    Director  July 24, 2001
Alfred J. Bianchetti


/s/Martin Brody*           Director    July 24, 2001
Martin Brody


/s/Dwight B. Crane*       Director   July 24, 2001
Dwight B. Crane


/s/Burt N. Dorsett*      Director  	July 24, 2001
Burt N. Dorsett


/s/Elliot S. Jaffe*      Director   July 24, 2001
Elliot S. Jaffe


/s/Stephen E. Kaufman*   Director  	July 24, 2001
Stephen E. Kaufman


/s/Joseph J. McCann*     Director  	July 24, 2001
Joseph J. McCann


/s/Cornelius C. Rose, Jr.*   Director  July 24, 2001
Cornelius C. Rose, Jr.


* Signed by Heath B. McLendon, their duly authorized
attorney-in-fact, pursuant to power of attorney dated
July 12, 2000.


EXHIBIT INDEX


Exhibit No.	Exhibit



(e)(5)	Form of Distribution Agreement with Salomon
		Smith Barney

(h)(5)		Transfer Agency Agreement with Citi
Fiduciary Trust Company


(h)(6)		Sub-Transfer Agency Agreement with PFPC
Global Fund Services


(j)(1)      Auditor's Consent



		Cover



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