UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM N-Q
QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED
MANAGEMENT INVESTMENT COMPANY
| Investment Company Act file number: | 811-07420 |
| Exact name of registrant as specified in charter: | Delaware Investments® Minnesota |
| Municipal Income Fund II, Inc. | |
| Address of principal executive offices: | 2005 Market Street |
| Philadelphia, PA 19103 | |
| Name and address of agent for service: | David F. Connor, Esq. |
| 2005 Market Street | |
| Philadelphia, PA 19103 | |
| Registrant’s telephone number, including area code: | (800) 523-1918 |
| Date of fiscal year end: | March 31 |
| Date of reporting period: | December 31, 2018 |
Item 1. Schedule of Investments.
Schedule of investments
Delaware Investments® Minnesota Municipal Income Fund II, Inc.
December 31, 2018 (Unaudited)
| Principal | Value | ||||||
| Amount° | (US $) | ||||||
| Municipal Bonds – 143.94% | |||||||
| Corporate Revenue Bonds – 0.96% | |||||||
| St. Paul Port Authority Solid | |||||||
| Waste Disposal Revenue | |||||||
| (Gerdau St. Paul Steel Mill | |||||||
| Project) Series 7 144A | |||||||
| 4.50% 10/1/37 (AMT) # | 1,715,000 | $ | 1,562,622 | ||||
| 1,562,622 | |||||||
| Education Revenue Bonds – 20.24% | |||||||
| Bethel Charter School Lease | |||||||
| Revenue | |||||||
| (Spectrum High School | |||||||
| Project) Series A 4.375% | |||||||
| 7/1/52 | 1,100,000 | 1,052,491 | |||||
| Brooklyn Park Charter School | |||||||
| Lease Revenue | |||||||
| (Prairie Seeds Academy | |||||||
| Project) | |||||||
| Series A 5.00% 3/1/34 | 990,000 | 994,623 | |||||
| Series A 5.00% 3/1/39 | 170,000 | 166,813 | |||||
| Cologne Charter School Lease | |||||||
| Revenue | |||||||
| (Cologne Academy Project) | |||||||
| Series A 5.00% 7/1/29 | 270,000 | 281,874 | |||||
| Series A 5.00% 7/1/45 | 445,000 | 434,151 | |||||
| Deephaven Charter School | |||||||
| (Eagle Ridge Academy | |||||||
| Project) | |||||||
| Series A 5.25% 7/1/37 | 590,000 | 613,671 | |||||
| Series A 5.25% 7/1/40 | 500,000 | 517,785 | |||||
| Duluth Housing & | |||||||
| Redevelopment Authority | |||||||
| (Duluth Public Schools | |||||||
| Academy Project) Series A | |||||||
| 5.00% 11/1/48 | 1,200,000 | 1,204,080 | |||||
| Forest Lake Minnesota | |||||||
| Charter School Revenue | |||||||
| (Lake International | |||||||
| Language Academy) | |||||||
| Series A 5.75% 8/1/44 | 705,000 | 740,215 | |||||
| Hugo Charter School Lease | |||||||
| Revenue | |||||||
| (Noble Academy Project) | |||||||
| Series A 5.00% 7/1/34 | 255,000 | 262,395 | |||||
| Series A 5.00% 7/1/44 | 775,000 | 785,765 | |||||
| Minneapolis Charter School | |||||||
| Lease Revenue | |||||||
| (Hiawatha Academies | |||||||
| Project) | |||||||
| Series A 5.00% 7/1/36 | 750,000 | 742,237 | |||||
| Series A 5.00% 7/1/47 | 900,000 | 860,526 | |||||
| Minneapolis Student Housing | |||||||
| Revenue | |||||||
| (Riverton Community | |||||||
| Housing Project) | |||||||
| 5.25% 8/1/39 | 205,000 | 212,808 | |||||
| 5.50% 8/1/49 | 990,000 | 1,034,847 | |||||
| Minnesota Higher Education | |||||||
| Facilities Authority Revenue | |||||||
| (Bethel University) 5.00% | |||||||
| 5/1/47 | 1,250,000 | 1,316,900 | |||||
| (Carleton College) | |||||||
| 4.00% 3/1/36 | 485,000 | 510,875 | |||||
| 5.00% 3/1/44 | 905,000 | 1,026,713 | |||||
| (College of St. Benedict) | |||||||
| 4.00% 3/1/36 | 410,000 | 411,234 | |||||
| (Gustavus Adolphus | |||||||
| College) 5.00% 10/1/47 | 2,600,000 | 2,848,378 | |||||
| (Macalester College) | |||||||
| 4.00% 3/1/42 | 900,000 | 930,375 | |||||
| 4.00% 3/1/48 | 600,000 | 616,818 | |||||
| (St. Catherine University) | |||||||
| Series A 4.00% 10/1/38 | 920,000 | 914,977 | |||||
| Series A 5.00% 10/1/45 | 785,000 | 855,061 | |||||
| (St. Johns University) | |||||||
| Series 8-I 5.00% 10/1/31 | 235,000 | 266,563 | |||||
| Series 8-I 5.00% 10/1/34 | 35,000 | 39,449 | |||||
| (St. Olaf College) Series | |||||||
| 8-N 4.00% 10/1/35 | 590,000 | 625,872 | |||||
| (St. Scholastic College) | |||||||
| Series H 5.25% 12/1/35 | 1,000,000 | 1,021,140 | |||||
| (Trustees Of The Hamline | |||||||
| University Of Minnesota) | |||||||
| Series B 5.00% 10/1/47 | 1,055,000 | 1,104,532 | |||||
| (University of St. Thomas) | |||||||
| Series 7-U 5.00% 4/1/22 | 750,000 | 820,073 | |||||
| Series A 4.00% 10/1/37 | 500,000 | 522,125 | |||||
| Otsego Charter School | |||||||
| (Kaleidoscope Charter | |||||||
| School) | |||||||
| Series A 5.00% 9/1/34 | 230,000 | 230,322 | |||||
| Series A 5.00% 9/1/44 | 400,000 | 387,608 | |||||
| Rice County Educational | |||||||
| Facilities Revenue | |||||||
| (Shattuck-St. Mary’s | |||||||
| School) Series A 144A | |||||||
| 5.00% 8/1/22 # | 1,250,000 | 1,307,263 | |||||
(continues) NQ-OVJ [12/18] 2/19 (737572) 1
Schedule of investments
Delaware Investments® Minnesota Municipal Income Fund II, Inc. (Unaudited)
| Principal | Value | ||||||
| Amount° | (US $) | ||||||
| Municipal Bonds (continued) | |||||||
| Education Revenue Bonds (continued) | |||||||
| St. Cloud Charter School | |||||||
| Lease Revenue | |||||||
| (Stride Academy Project) | |||||||
| Series A 5.00% 4/1/46 | 375,000 | $ | 205,826 | ||||
| St. Paul Housing & | |||||||
| Redevelopment Authority | |||||||
| Charter School Lease | |||||||
| Revenue | |||||||
| (Academia Cesar Chavez | |||||||
| School Project) Series A | |||||||
| 5.25% 7/1/50 | 825,000 | 811,264 | |||||
| (Great River School Project) | |||||||
| Series A 144A 4.75% | |||||||
| 7/1/29 # | 100,000 | 101,537 | |||||
| Series A 144A 5.50% | |||||||
| 7/1/38 # | 240,000 | 247,718 | |||||
| (Nova Classical Academy | |||||||
| Project) | |||||||
| Series A 4.125% 9/1/47 | 750,000 | 684,637 | |||||
| Series A 6.375% 9/1/31 | 750,000 | 809,047 | |||||
| (Twin Cities Academy | |||||||
| Project) Series A 5.30% | |||||||
| 7/1/45 | 630,000 | 637,585 | |||||
| University of Minnesota | |||||||
| Series A 5.00% 9/1/40 | 1,240,000 | 1,420,755 | |||||
| Series A 5.00% 9/1/42 | 2,000,000 | 2,286,620 | |||||
| 32,865,548 | |||||||
| Electric Revenue Bonds – 15.57% | |||||||
| Central Minnesota Municipal | |||||||
| Power Agency Revenue | |||||||
| (Brookings Southeast Twin | |||||||
| Cities Transportation) | |||||||
| 5.00% 1/1/32 | 1,130,000 | 1,215,417 | |||||
| (Brookings Twin Cities | |||||||
| Transmission Project) | |||||||
| 5.00% 1/1/42 | 1,000,000 | 1,066,330 | |||||
| Chaska Electric Revenue | |||||||
| Series A 5.00% 10/1/28 | 445,000 | 511,550 | |||||
| Minnesota Municipal Power | |||||||
| Agency Electric Revenue | |||||||
| 5.00% 10/1/25 | 500,000 | 573,400 | |||||
| 5.00% 10/1/26 | 500,000 | 571,370 | |||||
| 5.00% 10/1/27 | 320,000 | 364,387 | |||||
| 5.00% 10/1/47 | 1,755,000 | 1,963,705 | |||||
| Northern Municipal Power | |||||||
| Agency | |||||||
| Series A 5.00% 1/1/26 | 100,000 | 109,727 | |||||
| Series A 5.00% 1/1/30 | 340,000 | 368,886 | |||||
| Rochester Electric Utility | |||||||
| Revenue | |||||||
| Series A 5.00% 12/1/42 | 605,000 | 681,914 | |||||
| Series A 5.00% 12/1/47 | 985,000 | 1,106,559 | |||||
| Series B 5.00% 12/1/30 | 1,300,000 | 1,457,599 | |||||
| Series B 5.00% 12/1/43 | 1,000,000 | 1,105,590 | |||||
| Southern Minnesota | |||||||
| Municipal Power Agency | |||||||
| Supply Revenue | |||||||
| Series A 5.00% 1/1/41 | 240,000 | 267,358 | |||||
| Series A 5.00% 1/1/47 | 1,650,000 | 1,870,885 | |||||
| St. Paul Housing & | |||||||
| Redevelopment Authority | |||||||
| Charter School Lease | |||||||
| Revenue | |||||||
| Series A 4.00% 10/1/33 | 285,000 | 296,953 | |||||
| Series B 4.00% 10/1/37 | 800,000 | 818,960 | |||||
| Western Minnesota Municipal | |||||||
| Power Agency Supply | |||||||
| Revenue | |||||||
| Series A 5.00% 1/1/25 | 3,000,000 | 3,323,160 | |||||
| Series A 5.00% 1/1/26 | 1,000,000 | 1,107,720 | |||||
| Series A 5.00% 1/1/33 | 1,000,000 | 1,112,230 | |||||
| Series A 5.00% 1/1/40 | 750,000 | 822,743 | |||||
| Series A 5.00% 1/1/46 | 2,500,000 | 2,733,950 | |||||
| Series A 5.00% 1/1/49 | 1,610,000 | 1,835,754 | |||||
| 25,286,147 | |||||||
| Healthcare Revenue Bonds – 34.91% | |||||||
| Anoka Health Care Facilities | |||||||
| Revenue | |||||||
| 5.375% 11/1/34 | 610,000 | 636,419 | |||||
| Apple Valley Senior Housing | |||||||
| Revenue | |||||||
| (PHS Senior Housing, Inc. | |||||||
| Orchard Path Project) | |||||||
| 4.50% 9/1/53 | 1,960,000 | 1,896,398 | |||||
| 5.00% 9/1/58 | 1,605,000 | 1,659,056 | |||||
| Apple Valley Senior Living | |||||||
| Revenue | |||||||
| (Senior Living LLC Project) | |||||||
| Series B 5.00% 1/1/47 | 750,000 | 756,630 | |||||
| Series D 7.00% 1/1/37 | 720,000 | 699,948 | |||||
| Series D 7.25% 1/1/52 | 1,000,000 | 983,990 | |||||
| Bethel Housing & Health Care | |||||||
| Facilities Revenue | |||||||
| (Benedictine Health | |||||||
| System- St. Peter | |||||||
| Communities Project) | |||||||
| Series A 5.50% 12/1/48 | 500,000 | 497,065 | |||||
2 NQ-OVJ [12/18] 2/19 (737572)
(Unaudited)
| Principal | Value | ||||||
| Amount° | (US $) | ||||||
| Municipal Bonds (continued) | |||||||
| Healthcare Revenue Bonds (continued) | |||||||
| Center City Health Care | |||||||
| Facilities Revenue | |||||||
| (Hazelden Betty Ford | |||||||
| Foundation Project) 5.00% | |||||||
| 11/1/27 | 500,000 | $ | 548,595 | ||||
| (Hazelden Foundation | |||||||
| Project) 5.00% 11/1/41 | 1,600,000 | 1,622,752 | |||||
| City of Bethel | |||||||
| (The Lodge at Lakes at | |||||||
| Stillwater Project) 5.25% | |||||||
| 6/1/58 | 900,000 | 928,089 | |||||
| Cloquet Housing Facilities | |||||||
| Revenue | |||||||
| (HADC Cloquet Project) | |||||||
| Series A 5.00% 8/1/48 | 500,000 | 502,620 | |||||
| Dakota County Community | |||||||
| Development Agency | |||||||
| Senior Housing Revenue | |||||||
| (Walker Highview Hills | |||||||
| Project) | |||||||
| Series A 144A 5.00% | |||||||
| 8/1/46 # | 370,000 | 369,970 | |||||
| Series A 144A 5.00% | |||||||
| 8/1/51 # | 755,000 | 748,967 | |||||
| Deephaven Housing & | |||||||
| Healthcare Revenue | |||||||
| (St. Therese Senior Living | |||||||
| Project) | |||||||
| Series A 5.00% 4/1/38 | 280,000 | 275,895 | |||||
| Series A 5.00% 4/1/40 | 270,000 | 265,127 | |||||
| Duluth Economic | |||||||
| Development Authority | |||||||
| (Essentia Health Obligated | |||||||
| Group) Series A 5.00% | |||||||
| 2/15/48 | 810,000 | 882,317 | |||||
| (St. Luke’s Hospital | |||||||
| Authority Obligation | |||||||
| Group) | |||||||
| 5.75% 6/15/32 | 1,400,000 | 1,515,710 | |||||
| 6.00% 6/15/39 | 1,000,000 | 1,090,410 | |||||
| Hayward | |||||||
| (American Baptist Homes | |||||||
| Midwest) 5.75% 2/1/44 | 500,000 | 504,715 | |||||
| Hayward Health Care | |||||||
| Facilities Revenue | |||||||
| (St. John’s Lutheran Home | |||||||
| of Albert Lea) | |||||||
| 5.375% 10/1/44 | 400,000 | 412,004 | |||||
| Maple Grove Health Care | |||||||
| Facilities Revenue | |||||||
| (Maple Grove Hospital | |||||||
| Corporation) 4.00% | |||||||
| 5/1/37 | 1,000,000 | 1,015,550 | |||||
| (North Memorial Health | |||||||
| Care) 5.00% 9/1/30 | 865,000 | 951,163 | |||||
| Minneapolis Health Care | |||||||
| System Revenue | |||||||
| (Fairview Health Services) | |||||||
| Series A 4.00% 11/15/48 | 1,500,000 | 1,494,750 | |||||
| Series A 5.00% 11/15/33 | 500,000 | 560,635 | |||||
| Series A 5.00% 11/15/34 | 500,000 | 558,005 | |||||
| Series A 5.00% 11/15/49 | 2,000,000 | 2,192,400 | |||||
| Minneapolis Senior Housing & | |||||||
| Healthcare Revenue | |||||||
| (Ecumen Mill City Quarter) | |||||||
| 5.25% 11/1/45 | 850,000 | 867,391 | |||||
| 5.375% 11/1/50 | 200,000 | 204,668 | |||||
| (Ecumen-Abiitan Mill City | |||||||
| Project) 5.00% 11/1/35 | 220,000 | 223,318 | |||||
| Minneapolis – St. Paul | |||||||
| Housing & Redevelopment | |||||||
| Authority Health Care | |||||||
| Revenue | |||||||
| (Allina Health System) | |||||||
| Series A 5.00% 11/15/29 | 585,000 | 684,187 | |||||
| (Children’s Health Care | |||||||
| Facilities) Series A1 5.00% | |||||||
| 8/15/34 (AGM) | 500,000 | 520,885 | |||||
| Rochester Health Care & | |||||||
| Housing Revenue | |||||||
| (The Homestead at | |||||||
| Rochester Project) Series A | |||||||
| 6.875% 12/1/48 | 1,220,000 | 1,343,513 | |||||
| Rochester Health Care | |||||||
| Facilities Revenue | |||||||
| (Mayo Clinic) 4.00% | |||||||
| 11/15/41 | 4,860,000 | 4,924,055 | |||||
| Sartell Health Care Facilities | |||||||
| Revenue | |||||||
| (Country Manor Campus | |||||||
| Project) | |||||||
| 5.25% 9/1/30 | 1,000,000 | 1,062,070 | |||||
| Series A 5.30% 9/1/37 | 600,000 | 642,582 | |||||
(continues) NQ-OVJ [12/18] 2/19 (737572) 3
Schedule of investments
Delaware Investments® Minnesota Municipal Income Fund II, Inc. (Unaudited)
| Principal | Value | ||||||
| Amount° | (US $) | ||||||
| Municipal Bonds (continued) | |||||||
| Healthcare Revenue Bonds (continued) | |||||||
| Shakopee Health Care | |||||||
| Facilities Revenue | |||||||
| (St. Francis Regional | |||||||
| Medical Center) | |||||||
| 4.00% 9/1/31 | 205,000 | $ | 211,386 | ||||
| 5.00% 9/1/34 | 165,000 | 178,484 | |||||
| St. Cloud Health Care | |||||||
| Revenue | |||||||
| (Centracare Health System | |||||||
| Project) | |||||||
| Series A 4.00% 5/1/37 | 1,295,000 | 1,350,957 | |||||
| Series A 5.00% 5/1/46 | 4,800,000 | 5,274,624 | |||||
| Series B 5.00% 5/1/24 | 1,400,000 | 1,587,726 | |||||
| (Unrefunded - Centracare | |||||||
| Health System Project) | |||||||
| 5.125% 5/1/30 | 95,000 | 98,868 | |||||
| St. Paul Housing & | |||||||
| Redevelopment Authority | |||||||
| Health Care Facilities | |||||||
| Revenue | |||||||
| (Allina Health System) | |||||||
| Series A1 5.25% | |||||||
| 11/15/29 | 640,000 | 661,030 | |||||
| (Fairview Health Services) | |||||||
| Series A 4.00% 11/15/43 | 905,000 | 910,348 | |||||
| Series A 5.00% 11/15/47 | 680,000 | 747,354 | |||||
| (Health Partners Obligation | |||||||
| Group Project) | |||||||
| 5.00% 7/1/29 | 2,000,000 | 2,263,420 | |||||
| Series A 5.00% 7/1/32 | 1,100,000 | 1,225,510 | |||||
| St. Paul Housing & | |||||||
| Redevelopment Authority | |||||||
| Housing & Health Care | |||||||
| Facilities Revenue | |||||||
| (Senior Episcopal Homes | |||||||
| Project) | |||||||
| 5.125% 5/1/48 | 1,200,000 | 1,175,832 | |||||
| Series A 4.75% 11/1/31 | 740,000 | 728,086 | |||||
| Wayzata Senior Housing | |||||||
| Revenue | |||||||
| (Folkestone Senior Living | |||||||
| Community) | |||||||
| Series A 5.50% 11/1/32 | 420,000 | 430,786 | |||||
| Series A 5.75% 11/1/39 | 945,000 | 969,551 | |||||
| Series A 6.00% 5/1/47 | 1,475,000 | 1,514,058 | |||||
| Winona Health Care Facilities | |||||||
| Revenue | |||||||
| (Winona Health Obligation) | |||||||
| 4.65% 7/1/26 | 465,000 | 477,778 | |||||
| 4.75% 7/1/27 | 785,000 | 807,867 | |||||
| 5.00% 7/1/34 | 750,000 | 771,045 | |||||
| Woodbury Housing & | |||||||
| Redevelopment Authority | |||||||
| Revenue | |||||||
| (St. Therese of Woodbury) | |||||||
| 5.125% 12/1/44 | 1,250,000 | 1,266,787 | |||||
| 56,693,346 | |||||||
| Housing Revenue Bonds – 1.91% | |||||||
| Minneapolis Multifamily | |||||||
| Housing Revenue | |||||||
| (Olson Townhomes Project) | |||||||
| 6.00% 12/1/19 (AMT) | 190,000 | 190,344 | |||||
| Minnesota Housing Finance | |||||||
| Agency | |||||||
| (Non Ace - State | |||||||
| Appropriated Housing) | |||||||
| 5.00% 8/1/33 | 1,390,000 | 1,559,080 | |||||
| Minnesota State Housing | |||||||
| Finance Agency | |||||||
| Homeownership | |||||||
| (Mortgage-Backed | |||||||
| Securities Program) 4.40% | |||||||
| 7/1/32 (GNMA) (FNMA) | 770,000 | 785,508 | |||||
| Northwest Multi-County | |||||||
| Housing & Redevelopment | |||||||
| Authority | |||||||
| (Pooled Housing Program) | |||||||
| 5.50% 7/1/45 | 560,000 | 563,982 | |||||
| 3,098,914 | |||||||
| Lease Revenue Bonds – 10.09% | |||||||
| Minnesota State General | |||||||
| Fund Revenue | |||||||
| Appropriations | |||||||
| Series A 5.00% 6/1/32 | 780,000 | 866,463 | |||||
| Series A 5.00% 6/1/38 | 5,500,000 | 6,044,225 | |||||
| Series A 5.00% 6/1/43 | 1,750,000 | 1,916,285 | |||||
| Series B 5.00% 3/1/29 | 1,000,000 | 1,086,620 | |||||
| Minnesota State Housing | |||||||
| Finance Agency | |||||||
| (Non Ace - State | |||||||
| Appropriated Housing) | |||||||
| Series C 5.00% 8/1/36 | 1,000,000 | 1,116,140 | |||||
4 NQ-OVJ [12/18] 2/19 (737572)
(Unaudited)
| Principal | Value | ||||||
| Amount° | (US $) | ||||||
| Municipal Bonds (continued) | |||||||
| Lease Revenue Bonds (continued) | |||||||
| University of Minnesota | |||||||
| Special Purpose Revenue | |||||||
| (State Supported Biomed | |||||||
| Science Research) | |||||||
| 5.00% 8/1/35 | 1,040,000 | $ | 1,086,717 | ||||
| 5.00% 8/1/36 | 4,000,000 | 4,266,680 | |||||
| 16,383,130 | |||||||
| Local General Obligation Bonds – 12.49% | |||||||
| Brainerd Independent School | |||||||
| District No 181 | |||||||
| (General Obligation School | |||||||
| Building Bonds) Series A | |||||||
| 4.00% 2/1/38 | 1,500,000 | 1,556,625 | |||||
| Brainerd Independent School | |||||||
| District No. 181 | |||||||
| (General Obligation School | |||||||
| Building Bonds) Series A | |||||||
| 4.00% 2/1/43 | 1,500,000 | 1,539,585 | |||||
| Burnsville-Eagan-Savage | |||||||
| Independent School District | |||||||
| No 191 | |||||||
| (Alternative Facilities) | |||||||
| Series A 4.00% 2/1/28 | 1,185,000 | 1,279,077 | |||||
| Duluth Independent School | |||||||
| District No 709 | |||||||
| Series A Series A 4.00% | |||||||
| 2/1/27 | 600,000 | 636,816 | |||||
| Duluth, Minnesota | |||||||
| (Improvement DECC) | |||||||
| Series A 5.00% 2/1/34 | 545,000 | 623,365 | |||||
| Edina Independent School | |||||||
| District No. 273 | |||||||
| Series A 5.00% 2/1/27 | 1,500,000 | 1,734,915 | |||||
| Hennepin County | |||||||
| Series A 5.00% 12/1/36 | 1,190,000 | 1,380,091 | |||||
| Series A 5.00% 12/1/37 | 1,240,000 | 1,444,228 | |||||
| Series A 5.00% 12/1/41 | 1,060,000 | 1,213,912 | |||||
| Hopkins Independent School | |||||||
| District No. 270 | |||||||
| Series A 5.00% 2/1/28 | 1,000,000 | 1,061,160 | |||||
| Mahtomedi Independent | |||||||
| School District No. 832 | |||||||
| (School Building) Series A | |||||||
| 5.00% 2/1/28 | 515,000 | 592,811 | |||||
| Mounds View Independent | |||||||
| School District No. 621 | |||||||
| (School Building) Series A | |||||||
| 4.00% 2/1/43 | 2,000,000 | 2,071,220 | |||||
| St. Michael-Albertville | |||||||
| Independent School District | |||||||
| No. 885 | |||||||
| (School Building) Series A | |||||||
| 5.00% 2/1/27 | 1,300,000 | 1,532,687 | |||||
| St. Paul Independent School | |||||||
| District No. 625 | |||||||
| (School Building) Series B | |||||||
| 5.00% 2/1/26 | 1,000,000 | 1,110,680 | |||||
| Willmar | |||||||
| (Rice Memorial Hospital | |||||||
| Project) Series A 4.00% | |||||||
| 2/1/32 | 2,440,000 | 2,497,657 | |||||
| 20,274,829 | |||||||
| Pre-Refunded/Escrowed to Maturity Bonds – 23.61% | |||||||
| Anoka Health Care Facilities | |||||||
| Revenue | |||||||
| (Homestead Anoka Project) | |||||||
| Series A 7.00% | |||||||
| 11/1/46-19 § | 1,200,000 | 1,261,488 | |||||
| Dakota-Washington Counties | |||||||
| Housing & Redevelopment | |||||||
| Authority Single Family | |||||||
| Residential Mortgage | |||||||
| Revenue | |||||||
| (City of Bloomington) | |||||||
| Series B 8.375% 9/1/21 | |||||||
| (GNMA) (AMT) | 7,055,000 | 8,121,222 | |||||
| Deephaven Charter School | |||||||
| (Eagle Ridge Academy | |||||||
| Project) Series A 5.50% | |||||||
| 7/1/43-23 § | 500,000 | 573,705 | |||||
| Minnesota Higher Education | |||||||
| Facilities Authority Revenue | |||||||
| (College of St. Benedict) | |||||||
| Series 7-M 5.00% | |||||||
| 3/1/31-20 § | 300,000 | 310,800 | |||||
| Series 7-M 5.125% | |||||||
| 3/1/36-20 § | 275,000 | 285,291 | |||||
| (St. Catherine University) | |||||||
| Series 7-Q 5.00% | |||||||
| 10/1/32-22 § | 700,000 | 773,241 | |||||
| (University of St. Thomas) | |||||||
| Series 7-A 5.00% | |||||||
| 10/1/39-19 § | 1,000,000 | 1,023,380 | |||||
| Minnesota State | |||||||
| (Various Purposes) Series D | |||||||
| 5.00% 8/1/24-20 § | 65,000 | 68,189 | |||||
(continues) NQ-OVJ [12/18] 2/19 (737572) 5
Schedule of investments
Delaware Investments® Minnesota Municipal Income Fund II, Inc. (Unaudited)
| Principal | Value | ||||||
| Amount° | (US $) | ||||||
| Municipal Bonds (continued) | |||||||
| Pre-Refunded/Escrowed to Maturity Bonds (continued) | |||||||
| Rochester Health Care & | |||||||
| Housing Revenue | |||||||
| (Samaritan Bethany) | |||||||
| Series A 7.375% | |||||||
| 12/1/41-19 § | 1,220,000 | $ | 1,279,560 | ||||
| Rocori Independent School | |||||||
| District No. 750 | |||||||
| (School Building) | |||||||
| Series B 5.00% | |||||||
| 2/1/24-19 § | 1,075,000 | 1,077,817 | |||||
| Series B 5.00% | |||||||
| 2/1/25-19 § | 1,115,000 | 1,117,921 | |||||
| Series B 5.00% | |||||||
| 2/1/26-19 § | 1,155,000 | 1,158,026 | |||||
| St. Cloud Health Care | |||||||
| Revenue | |||||||
| (Centracare Health System | |||||||
| Project) | |||||||
| 5.50% 5/1/39-19 (AGC) § | 1,500,000 | 1,518,300 | |||||
| Series A 5.125% | |||||||
| 5/1/30-20 § | 3,830,000 | 3,992,622 | |||||
| St. Louis Park Health Care | |||||||
| Facilities Revenue | |||||||
| (Park Nicollet Health | |||||||
| Services) 5.75% | |||||||
| 7/1/39-19 § | 2,000,000 | 2,038,520 | |||||
| St. Paul Housing & | |||||||
| Redevelopment Authority | |||||||
| Health Care Facilities | |||||||
| Revenue | |||||||
| (Allina Health System) | |||||||
| Series A1 5.25% | |||||||
| 11/15/29-19 § | 755,000 | 777,084 | |||||
| St. Paul Housing & | |||||||
| Redevelopment Authority | |||||||
| Hospital Facility | |||||||
| (Healtheast Care System | |||||||
| Project) | |||||||
| Series A 5.00% | |||||||
| 11/15/29-25 § | 395,000 | 464,018 | |||||
| Series A 5.00% | |||||||
| 11/15/30-25 § | 290,000 | 340,672 | |||||
| University of Minnesota | |||||||
| Series A 5.25% | |||||||
| 4/1/29-19 § | 1,000,000 | 1,008,760 | |||||
| Series A 5.50% 7/1/21 | 4,000,000 | 4,210,080 | |||||
| Series D 5.00% | |||||||
| 12/1/27-21 § | 1,110,000 | 1,209,623 | |||||
| Series D 5.00% | |||||||
| 12/1/29-21 § | 1,265,000 | 1,378,534 | |||||
| Series D 5.00% | |||||||
| 12/1/31-21 § | 1,000,000 | 1,089,750 | |||||
| Series D 5.00% | |||||||
| 12/1/36-21 § | 3,000,000 | 3,269,250 | |||||
| 38,347,853 | |||||||
| Special Tax Revenue Bonds – 1.52% | |||||||
| Guam Government Business | |||||||
| Privilege Tax Revenue | |||||||
| Series A 5.25% 1/1/36 | 150,000 | 155,971 | |||||
| Minneapolis Community | |||||||
| Planning & Economic | |||||||
| Development Department | |||||||
| (Limited Tax Supported | |||||||
| Common Bond Fund) | |||||||
| 6.25% 12/1/30 | 1,000,000 | 1,077,910 | |||||
| Minneapolis Revenue | |||||||
| (YMCA Greater Twin Cities | |||||||
| Project) 4.00% 6/1/29 | 165,000 | 176,794 | |||||
| St. Paul Sales Tax Revenue | |||||||
| Series G 5.00% 11/1/30 | 935,000 | 1,056,671 | |||||
| 2,467,346 | |||||||
| State General Obligation Bonds – 12.62% | |||||||
| Minnesota State | |||||||
| Series A 5.00% 8/1/24 | 1,000,000 | 1,158,150 | |||||
| Series A 5.00% 8/1/29 | 700,000 | 815,213 | |||||
| Series E 5.00% 10/1/26 | 1,480,000 | 1,779,389 | |||||
| (State Trunk Highway) | |||||||
| Series B 5.00% 10/1/22 | 5,500,000 | 5,952,155 | |||||
| Series B 5.00% 10/1/29 | 3,315,000 | 3,574,565 | |||||
| (Various Purposes) | |||||||
| Series D 5.00% 8/1/24 | 2,635,000 | 2,757,554 | |||||
| Series F 5.00% 10/1/22 | 4,000,000 | 4,452,160 | |||||
| 20,489,186 | |||||||
| Transportation Revenue Bonds – 6.88% | |||||||
| Minneapolis – St. Paul | |||||||
| Metropolitan Airports | |||||||
| Commission Revenue | |||||||
| 5.00% 1/1/22 | 670,000 | 710,053 | |||||
| Subordinate | |||||||
| Series A 5.00% 1/1/31 | 410,000 | 481,586 | |||||
| Series A 5.00% 1/1/32 | 1,255,000 | 1,466,217 | |||||
| Series B 5.00% 1/1/26 | 540,000 | 585,058 | |||||
| Series B 5.00% 1/1/26 | |||||||
| (AMT) | 500,000 | 556,855 | |||||
| Series B 5.00% 1/1/27 | 1,190,000 | 1,287,128 | |||||
| Series B 5.00% 1/1/30 | 500,000 | 538,395 | |||||
6 NQ-OVJ [12/18] 2/19 (737572)
(Unaudited)
| Principal | Value | ||||||
| Amount° | (US $) | ||||||
| Municipal Bonds (continued) | |||||||
| Transportation Revenue Bonds (continued) | |||||||
| Minneapolis – St. Paul | |||||||
| Metropolitan Airports | |||||||
| Commission Revenue | |||||||
| Series B 5.00% 1/1/31 | 250,000 | $ | 268,897 | ||||
| Series C 5.00% 1/1/33 | 2,000,000 | 2,328,780 | |||||
| Series C 5.00% 1/1/36 | 1,000,000 | 1,151,970 | |||||
| Series C 5.00% 1/1/46 | 1,245,000 | 1,412,303 | |||||
| St. Paul Port Authority | |||||||
| Revenue | |||||||
| (Amherst H. Wilder | |||||||
| Foundation) Series 3 | |||||||
| 5.00% 12/1/36 | 380,000 | 381,493 | |||||
| 11,168,735 | |||||||
| Water & Sewer Revenue Bonds – 3.14% | |||||||
| Guam Government | |||||||
| Waterworks Authority | |||||||
| 5.00% 7/1/40 | 840,000 | 895,003 | |||||
| Metropolitan Council Waste | |||||||
| Water Revenue | |||||||
| Series B 4.00% 9/1/27 | 1,145,000 | 1,216,677 | |||||
| Series C 4.00% 3/1/31 | 1,355,000 | 1,475,947 | |||||
| Series C 4.00% 3/1/32 | 1,405,000 | 1,517,611 | |||||
| 5,105,238 | |||||||
| Total Municipal Bonds | |||||||
| (cost $229,816,570) | 233,742,894 | ||||||
| Short-Term Investments – 0.31% | |||||||
| Variable Rate Demand Notes – 0.31%¤ | |||||||
| Minneapolis – St. Paul | |||||||
| Housing & Redevelopment | |||||||
| Authority Health Care | |||||||
| Revenue | |||||||
| Series A (Children’s | |||||||
| Hospitals & Clinics) | |||||||
| 1.42% 8/15/37 (AGM) | |||||||
| (SPA – US Bank N.A.) | 200,000 | 200,000 | |||||
| Series B-2 (Allina Health | |||||||
| System) | |||||||
| 1.38% 11/15/35 (LOC- | |||||||
| JPMorgan Chase Bank | |||||||
| N.A.) | 300,000 | 300,000 | |||||
| Total Short-Term | |||||||
| Investments | |||||||
| (cost $500,000) | 500,000 | ||||||
| Total Value of | |||||||
| Securities – 144.25% | |||||||
| (cost $230,316,570) | $ | 234,242,894 | |||||
| Liquidation Value of | |||||||
| Preferred | |||||||
| Stock – (46.19%) | (75,000,000 | ) | |||||
| Receivables and Other | |||||||
| Assets Net of | |||||||
| Liabilities – 1.94% | 3,148,035 | ||||||
| Net Assets Applicable to | |||||||
| 11,504,975 Shares | |||||||
| Outstanding – 100.00% | $ | 162,390,929 | |||||
| # | Security exempt from registration under Rule 144A of the Securities Act of 1933, as amended. At Dec. 31, 2018, the aggregate value of Rule 144A securities was $4,338,077, which represents 2.67% of the Fund’s net assets. |
| ¤ | Tax-exempt obligations that contain a floating or variable interest rate adjustment formula and an unconditional right of demand to receive payment of the unpaid principal balance plus accrued interest upon a short notice period (generally up to 30 days) prior to specified dates either from the issuer or by drawing on a bank letter of credit, a guarantee, or insurance issued with respect to such instrument. Each rate shown is as of Dec. 31, 2018. |
| § | Pre-refunded bonds. Municipal bonds that are generally backed or secured by US Treasury bonds. For pre-refunded bonds, the stated maturity is followed by the year in which the bond will be pre-refunded. |
| ° | Principal amount shown is stated in USD unless noted that the security is denominated in another currency. |
Summary of abbreviations:
AGC – Insured by Assured Guaranty Corporation
AGM – Insured by Assured Guaranty Municipal Corporation
AMT – Subject to Alternative Minimum Tax
FNMA – Federal National Mortgage Association Collateral
GNMA – Government National Mortgage Association Collateral
LOC – Letter of Credit
N.A. – National Association
SPA – Stand-by Purchase Agreement
USD – United States Dollar
See accompanying notes.
NQ-OVJ [12/18] 2/19 (737572) 7
Notes
Delaware Investments® Minnesota Municipal Income Fund II, Inc.
December 31, 2018 (Unaudited)
1. Significant Accounting Policies
Delaware Investments Minnesota Municipal Income Fund II, Inc. (Fund) is an investment company and follows accounting and reporting guidance under Financial Accounting Standards Board (FASB) Accounting Standards Codification Topic 946, Financial Services - Investment Companies. The following accounting policies are in accordance with US generally accepted accounting principles (US GAAP) and are consistently followed by the Fund. This report covers the period of time since the Fund’s last fiscal year end, March 31, 2018.
Security Valuation — Debt securities are valued based upon valuations provided by an independent pricing service or broker and reviewed by management. To the extent current market prices are not available, the pricing service may take into account developments related to the specific security, as well as transactions in comparable securities. Valuations for fixed income securities utilize matrix systems, which reflect such factors as security prices, yields, maturities, and ratings, and are supplemented by dealer and exchange quotations. Generally, other securities and assets for which market quotations are not readily available are valued at fair value as determined in good faith under the direction of the Trust’s Board of Directors (Board). In determining whether market quotations are readily available or fair valuation will be used, various factors will be taken into consideration, such as market closures or suspension of trading in a security. Restricted securities are valued at fair value using methods approved by the Board.
2. Investments
US GAAP defines fair value as the price that the Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. A three-level hierarchy for fair value measurements has been established based upon the transparency of inputs to the valuation of an asset or liability. Inputs may be observable or unobservable and refer broadly to the assumptions that market participants would use in pricing the asset or liability. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions that market participants would use in pricing the asset or liability based on the best information available under the circumstances. The Fund’s investment in its entirety is assigned a level based upon the observability of the inputs which are significant to the overall valuation. The three-level hierarchy of inputs is summarized below.
| Level 1 | – | Inputs are quoted prices in active markets for identical investments. (Examples: equity securities, open-end investment companies, futures contracts, exchange-traded options contracts) |
| Level 2 | – | Other observable inputs, including, but not limited to: quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks, and default rates) or other market-corroborated inputs. (Examples: debt securities, government securities, swap contracts, foreign currency exchange contracts, foreign securities utilizing international fair value pricing, broker-quoted securities, fair valued securities) |
| Level 3 | – | Significant unobservable inputs, including the Fund’s own assumptions used to determine the fair value of investments. (Examples: broker-quoted securities, fair valued securities) |
Level 3 investments are valued using significant unobservable inputs. The Fund may also use an income-based valuation approach in which the anticipated future cash flows of the investment are discounted to calculate fair value. Discounts may also be applied due to the nature or duration of any restrictions on the disposition of the investments. Valuations may also be based upon current market prices of securities that are comparable in coupon, rating, maturity, and industry. The derived value of a Level 3 investment may not represent the value which is received upon disposition and this could impact the results of operations.
8 NQ-OVJ [12/18] 2/19 (737572)
(Unaudited)
The following table summarizes the valuation of the Fund’s investments by fair value hierarchy levels as of Dec. 31, 2018:
| Securities | Level 2 | |
| Assets: | ||
| Municipal Bonds | $233,742,894 | |
| Short-Term Investments | 500,000 | |
| Total Value of Securities | $234,242,894 |
During the period ended Dec. 31, 2018, there were no transfers between Level 1 investments, Level 2 investments, or Level 3 investments that had a significant impact to the Fund. The Fund’s policy is to recognize transfers between levels based on fair value at the beginning of the reporting period.
A reconciliation of Level 3 investments is presented when the Fund has a significant amount of Level 3 investments at the beginning, interim, or end of the period in relation to the Fund’s net assets. During the period ended Dec. 31, 2018, there were no Level 3 investments.
3. Recent Accounting Pronouncements
In March 2017, the FASB issued an Accounting Standards Update, ASU 2017-08, Receivables — Nonrefundable Fees and Other Costs (Subtopic 310-20), Premium Amortization on Purchased Callable Debt Securities which amends the amortization period for certain callable debt securities purchased at a premium, shortening such period to the earliest call date. The ASU 2017-08 does not require any accounting change for debt securities held at a discount; the discount continues to be amortized to maturity. The ASU 2017-08 is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2018. At this time, management is evaluating the implications of these changes on the financial statements.
In August 2018, the FASB issued an Accounting Standards Update, ASU 2018-13, which changes certain fair value measurement disclosure requirements. The ASU 2018-13, in addition to other modifications and additions, removes the requirement to disclose the amount and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, the policy for the timing of transfers between levels and the valuation process for Level 3 fair value measurements. The ASU 2018-13 is effective for fiscal years, and interim periods within those fiscal years, beginning after Dec. 15, 2019. At this time, management is evaluating the implications of these changes on the financial statements.
4. Subsequent Events
Management has determined that no material events or transactions occurred subsequent to Dec. 31, 2018 that would require recognition or disclosure in the Fund’s “Schedule of investments.”
NQ-OVJ [12/18] 2/19 (737572) 9
Item 2. Controls and Procedures.
The registrant’s principal executive officer and principal financial officer have evaluated the registrant’s disclosure controls and procedures within 90 days of the filing of this report and have concluded that they are effective in providing reasonable assurance that the information required to be disclosed by the registrant in its reports or statements filed under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the Securities and Exchange Commission.
There were no significant changes in the registrant’s internal control over financial reporting that occurred during the registrant’s last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant’s internal control over financial reporting.
Item 3. Exhibits.
File as exhibits as part of this Form a separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the Act (17 CFR 270.30a-2(a)), exactly as set forth below: