DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
DREYFUS MUNICIPAL INCOME, INC.
DREYFUS NEW YORK MUNICIPAL INCOME, INC.
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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
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To the Stockholders:
The Annual Meeting of Stockholders of each of Dreyfus California Municipal
Income, Inc., Dreyfus Municipal Income, Inc. and Dreyfus New York Municipal
Income, Inc. (each, a "Fund" and, collectively, the "Funds") will be held at the
offices of The Dreyfus Corporation, 200 Park Avenue, 7th Floor West, New York,
New York, on Friday, May 23, 2003 at 10:00 a.m., for the following purposes:
1. To elect three Class I Directors to serve for a three-year term for each
Fund and until their successors are duly elected and qualified.
2. With respect to Dreyfus Municipal Income, Inc. only, to approve a change
to the fundamental investment policies and investment restrictions of
Dreyfus Municipal Income, Inc. to permit the Fund to engage in swap
transactions.
3. To approve a change to the fundamental investment policies and
investment restrictions of each Fund to expand the Fund's
ability to invest in other investment companies.
4. To transact such other business as may properly come before the meeting,
or any adjournment or adjournments thereof.
Stockholders of record at the close of business on March 21, 2003 will be
entitled to receive notice of and to vote at the meeting.
By Order of the Board
Robert R. Mullery
Assistant Secretary
New York, New York
April 18, 2003
WE NEED YOUR PROXY VOTE
A STOCKHOLDER MAY THINK HIS OR HER VOTE IS NOT IMPORTANT, BUT IT IS VITAL. BY
LAW, THE ANNUAL MEETING OF STOCKHOLDERS OF A FUND WILL HAVE TO BE ADJOURNED
WITHOUT CONDUCTING ANY BUSINESS IF LESS THAN A QUORUM IS REPRESENTED. IN THAT
EVENT, THE AFFECTED FUND WOULD CONTINUE TO SOLICIT VOTES IN AN ATTEMPT TO
ACHIEVE A QUORUM. CLEARLY, YOUR VOTE COULD BE CRITICAL TO ENABLE THE FUND TO
HOLD THE MEETING AS SCHEDULED, SO PLEASE RETURN YOUR PROXY CARD OR OTHERWISE
VOTE PROMPTLY. YOU AND ALL OTHER STOCKHOLDERS WILL BENEFIT FROM YOUR
COOPERATION.
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DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
DREYFUS MUNICIPAL INCOME, INC.
DREYFUS NEW YORK MUNICIPAL INCOME, INC.
COMBINED PROXY STATEMENT
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ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON FRIDAY, MAY 23, 2003
This proxy statement is furnished in connection with a solicitation of
proxies by the Board of each of Dreyfus California Municipal Income, Inc.
(" DCMI"), Dreyfus Municipal Income, Inc. ("DMI") and Dreyfus New York Municipal
Income, Inc. (" DNYMI" ) (each, a "Fund" and, collectively, the "Funds") to be
used at the Annual Meeting of Stockholders of each Fund to be held on Friday,
May 23, 2003 at 10: 00 a.m., at the offices of The Dreyfus Corporation
(" Dreyfus" ), 200 Park Avenue, 7th Floor West, New York, New York, for the
purposes set forth in the accompanying Notice of Annual Meeting of Stockholders.
Stockholders of record at the close of business on March 21, 2003 are entitled
to be present and to vote at the meeting. Stockholders are entitled to one vote
for each Fund share held and fractional votes for each fractional Fund share
held. Stockholders can vote only on matters affecting the Fund(s) in which they
hold shares. If a proposal is approved by stockholders of one Fund and not
approved by stockholders of any other Fund, the proposal will be implemented
only for the Fund that approved the proposal. Therefore, it is essential that
stockholders who own shares in more than one Fund complete, date, sign and
return each proxy card they receive. Shares represented by executed and
unrevoked proxies will be voted in accordance with the specifications made
thereon. If the enclosed form of proxy is executed and returned, it nevertheless
may be revoked by a proxy given later. To be effective, such revocation must be
received prior to the meeting. In addition, any stockholder who attends the
meeting in person may vote by ballot at the meeting, thereby cancelling any
proxy previously given. As of March 21, 2003, the Funds had outstanding the
following number of shares:
COMMON AUCTION PREFERRED
NAME OF FUND STOCK OUTSTANDING STOCK OUTSTANDING
DCMI 4,572,972 N/A
DMI 20,393,571 4,000
DNYMI 3,821,501 N/A
It is estimated that proxy materials will be mailed to stockholders of
record on or about April 18, 2003. The principal executive offices of each Fund
are located at 200 Park Avenue, New York, New York 10166. COPIES OF EACH FUND'S
MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS ARE AVAILABLE UPON REQUEST, WITHOUT
CHARGE, BY WRITING TO THE FUND AT 144 GLENN CURTISS BOULEVARD, UNIONDALE, NEW
YORK 11556-0144, OR BY CALLING TOLL FREE 1-800-334-6899.
A quorum is constituted by the presence in person or by proxy of the holders
of a majority of the outstanding shares of the Fund entitled to vote at the
meeting. If a proposal is to be voted upon by only one class of a Fund's shares,
a quorum of that class of shares (the holders of a majority of the outstanding
shares of the class) must be present in person or by proxy at the meeting in
order for the proposal to be considered. DMI is the only Fund with two classes
of capital stock: Common Stock, par value $0.001 per share ( the "Common Stock")
, and Auction Preferred Stock, par value $0.001 per share, liquidation
preference $25,000 per share (the "APS"). The APS is further divided into Series
A and Series B. Currently, no proposal is expected to be presented at the
meeting that would require separate voting for each Series of APS.
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PROPOSAL 1: ELECTION OF DIRECTORS
Each Fund' s Board of Directors is divided into three classes with the term
of office of one class expiring each year. It is proposed that stockholders of
each Fund consider the election of three Class I Directors to serve for
three-year terms and until their respective successors are duly elected and
qualified. The individual nominees (the "Nominees") proposed for election are
listed below. Each Nominee currently serves as a Director of the Funds. Each
Nominee has consented to being named in this proxy statement and has agreed to
continue to serve as a Board member of each Fund if elected. Biographical
information about each Nominee is set forth below. Biographical information
about each Fund' s Continuing Directors, information on each Nominee's and
Continuing Director's ownership of Fund shares and other relevant information is
set forth on Exhibit A. Unless otherwise indicated, information set forth herein
applies to all Funds.
Under the terms of DMI' s Charter, holders of the APS voting as a single
class are entitled, to the exclusion of holders of the Common Stock, to elect
two directors of DMI. As such Directors, the APS holders elected Whitney I.
Gerard in May 2001 as a Class II Director whose term expires in 2004, and George
L. Perry in May 2002 as a Class III Director whose term expires in 2005.
Currently, there are no APS designees proposed for election at this meeting.
Voting with regard to the election of Directors will be as follows:
stockholders of DCMI and DNMI will vote with regard to the election of each
Class I Director for each such Fund; for DMI, holders of Common Stock and APS
will vote together as a single class with respect to the election of each Class
I Director for such Fund.
The persons named as proxies on the accompanying proxy card(s) intend to
vote each such proxy for the election of the Nominees, unless stockholders
specifically indicate on their proxies the desire to withhold authority to vote
for elections to office. It is not contemplated that any Nominee will be unable
to serve as a Board member for any reason, but if that should occur prior to the
meeting, the proxyholders reserve the right to substitute another person or
persons of their choice as nominee or nominees.
None of the Nominees or Continuing Directors are "interested persons" of any
of the Funds, as defined in the Investment Company Act of 1940, as amended (the
" 1940 Act" ). As independent directors of investment companies, they play a
critical role in overseeing fund operations and policing potential conflicts of
interest between the fund and its investment adviser and other service
providers. The following tables present information about the Nominees including
their principal occupations and other board memberships and affiliations. The
address of each Nominee is 200 Park Avenue, New York, New York 10166.
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DMI, DCMI AND DNYMI -- NOMINEES FOR CLASS I DIRECTOR WITH TERM EXPIRING IN 2006
NAME (AGE) OF NOMINEE PRINCIPAL OCCUPATION OTHER BOARD MEMBERSHIPS
POSITION WITH FUND (SINCE) DURING PAST 5 YEARS AND AFFILIATIONS
LUCY WILSON BENSON (75) President of Benson & Associates, The International Executive
CLASS I DIRECTOR OF EACH FUND (1988) consultants to business and government Services Corps., DIRECTOR
(1980 - present) Citizens Network for
Foreign Affairs, VICE CHARIMAN
Council on Foreign
Relations, MEMBER
Lafayette College Board of
Trustees, VICE CHAIRMAN EMERITUS
DAVID W. BURKE (66) Corporate Director and Truste John F. Kennedy Library
CLASS I DIRECTOR OF EACH FUND (1994) Foundation, DIRECTOR
U.S.S. Constitution
Museum, DIRECTOR
CLIFFORD L. ALEXANDER, JR. (69) President of Alexander & Associates, Wyeth (formerly, American
CLASS I DIRECTOR OF EACH FUND (2003) Inc., a management consulting firm Home Products Corporation),
(January 1981 - present) a global leader in pharmaceuticals,
Chairman of the Board of Moody's consumer healthcare products and
Corporation (October 2000 - present) animal health products, DIRECTOR
Chairman of the Board and Chief Mutual of America Life
Executive Officer of The Dun and Insurance Company, DIRECTOR
Brandstreet Corporation (October 1999 -
September 2000)
Each Fund has standing audit, nominating and compensation committees, each
comprised of its Directors who are not "interested persons" of the Fund, as
defined in the 1940 Act. The function of the audit committee is to oversee the
Fund' s financial and reporting policies and certain internal control matters. A
copy of each Fund' s Audit Committee Charter, which describes the audit
committee' s purposes, duties and powers, is attached as Exhibit C to this proxy
statement. The function of the nominating committee is to select and nominate
all candidates who are not "interested persons" of the Fund for election to the
Fund' s Board. The nominating committee does not normally consider nominees
recommended by stockholders. The function of the compensation committee is to
establish the appropriate compensation for serving on the Board. Each Fund also
has a standing pricing committee comprised of any one Director. The function of
the pricing committee is to assist in valuing the Fund's investments. Each
Fund' s audit committee met four times, and each Fund's pricing, nominating and
compensation committees did not meet during the Fund's last fiscal year.
Each Fund Director also serves as a director of other funds in the Dreyfus
fund complex. Effective January 1, 2003, each Fund typically pays its Directors
its allocated portion of an annual retainer of $60,000 and a fee of $7,500 per
meeting (with a minimum of $500 per meeting and per telephone meeting) attended
for the Fund and 16 other funds (comprised of 41 portfolios) in the Dreyfus
Family of Funds, and reimburses them for their expenses. The Chairman of the
Board of Directors, Joseph S. DiMartino, receives an additional 25% of such
compensation. Emeritus Directors, if any, are entitled to receive an annual
retainer and per meeting attended fee of one-half the amount paid to them as
Board members. The Funds had no Emeritus
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Directors as of the date of this proxy statement. The Funds do not pay any other
remuneration to their officers or Board members, and none of the Funds has a
bonus, pension, profit-sharing or retirement plan.
The aggregate amount of compensation paid to each Nominee by each Fund for
the fiscal year ended September 30, 2002 under the compensation schedule then in
effect for the Funds, and by all funds in the Dreyfus Family of Funds for which
such Nominee was a Board member (the number of portfolios of such funds is set
forth in parenthesis next to each Nominee's total compensation) for the year
ended December 31, 2002, was as follows:
AGGREGATE AGGREGATE AGGREGATE TOTAL COMPENSATION FROM
COMPENSATION FROM COMPENSATION FROM COMPENSATION FROM THE FUNDS AND FUND COMPLEX
NAME OF NOMINEE DMI* DCMI* DNYMI* PAID TO NOMINEES (**)
Lucy Wilson Benson $1,910 $1,198 $172 $130,500 (34)
David W. Burke $1,900 $697 $170 $258,250 (60)
Clifford L. Alexander, Jr.*** N/A N/A N/A $134,500 (27)
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* Amount does not include reimbursed expenses for attending Board meetings,
which amounted to $2,393, $1,834 and $1,395 for DMI, DCMI and
DNYMI, respectively, for all Board members as a group.
** Represents the number of separate portfolios comprising the investment
companies in the fund complex, including the Funds, for which the Nominee
serves as a Board member.
*** Mr. Alexander was elected a Board member of each Fund effective January 1,
2003; accordingly, he received no compensation from any of the Funds for
the fiscal year ended September 30, 2002.
For each Fund's most recent fiscal year, the number of Board meetings held
and the aggregate amount of compensation paid by the Fund to each Continuing
Director and by all funds in the Dreyfus Family of Funds for which such person
is a Board member are set forth in Exhibit A. Certain other information
concerning each Fund's Directors and officers also is set forth in Exhibit A.
REQUIRED VOTE
The election of a Nominee for each Fund requires the affirmative vote of a
plurality of votes cast at the Fund's meeting for the election of Directors.
PROSPOSAL 2 (DMI ONLY): TO PERMIT THE FUND TO ENGAGE IN SWAP TRANSACTIONS
DMI seeks to achieve its investment goal by investing at least 80% of its
assets (except when maintaining a temporary defensive position) in municipal
bonds that provide income exempt from federal income taxes ("Municipal Bonds").
From time to time, on a temporary basis other than for temporary defensive
purposes (but not to exceed 20% of the Fund's assets) or for temporary defensive
purposes, the Fund may invest in taxable short-term instruments ("Taxable
Investments"). As a fundamental policy, DMI may invest only in Municipal Bonds
And Taxable Investments as described in its prospectus. The Fund also is
permitted to engage in futures and options transactions to the extent described
in its prospectus.
Management believes that in a rapidly changing market it is
important for the Fund to have greater flexibility in the types of investment
techniques in which it is permitted to engage. Accordingly, this proposal seeks
approval to expand the Fund's investment techniques to permit the Fund to engage
in swap transactions, including interest rate swaps, interest rate locks, caps,
collars and floors (collectively, "swap transactions"), which are forms of
derivatives. By expanding the universe of investment techniques in which DMI may
engage Specifically to include swap transactions, management will be given the
Opportunity to adjust the Fund's portfolio from time to obtain a particular
return when it is considered desirable to do so, possibly at a lower cost than
if the Fund had invested directly in the securities that yielded the desired
return. Morever, having the ability to engage in swap transactions would provide
the Fund with an additional means to manage interest rate risk. Management
intends to usw swap tranactions to mitigate risk, manage duration and reduce
portfolio turnover. Management does not intend to increase either Fund's risk
profile by using these derivatives.
To enable DMI to broaden its permissible investment techniques as described
above, the Fund's Board approved eliminating the restrictive fundamental policy
and investment restriction of the Fund and directed that this Proposal be
submitted to stockholders for their approval. The recommended change also will
provide flexibility to respond to future legal, regulatory, market or technical
changes.
Specifically, this Proposal involves eliminating the restriction
limiting DMI's investments to Municipal Bonds and Taxable Investments, making
conforming changes to certain other restrictions, and changing the Fund's
investment techniques to permit the Fund to engage in swap transactions. This
Proposal does NOT involve any change to DMI's investment objective, the
requirement that, as a fundamental policy, the Fund invest at least 80% of its
assets in Municipal Bonds or the limitations on purchasing Taxable Investments.
Swap transactions will be subject to the Fund's limits on investments in Taxable
Investments.
If approved by DMI's stockholders, the Fund would be permitted, but
not required, to enter into swap transactions. Swap agreements are two-party
contracts entered into primarily by institutional investors for periods ranging
from a few weeks to more than a year. In a standard swap transaction, two
parties agree to exchange the returns (or differentials in rates of return)
earned or realized on particular predetermined investments or instruments, which
may be adjusted for an interest factor. The gross returns to be exchanged or
"swapped" between the parties generally are calculated with respect to a
"notional amount" (i.e., the return on or increase in value of a particular
dollar amount invested at a particular interest rate). Under the commonest form
of interest rate swap, a series of payments calculated by applying a fixed rate
of interest to a notional principal amount is exchanged for a stream of payments
similarly calculated but using a floating rate of interest. This is a
fixed-for-floating interest rate swap. Alternatively, both series of cashflows
to be exchanged could be calculated using floating rates of interest but
floating rates that are based upon different underlying indices. Depending on
their structure, swap agreements may increase or decrease the Fund's exposure to
changes in long- or short-term interest rates. Forms of swap agreements include
interest rate caps, under which, in return for a premium, one party agrees to
make payments to the other to the extent interest rates exceed a specified rate
or "cap"; interest rate floors, under which, in return for a premium, one party
agrees to make payments to the other to the extent interest rates fall below a
specified level or "floor"; and interest rate collars, under which a party sells
a cap and purchases a floor or vice versa in an attempt to protect itself
against interest rate movements exceeding given minimum or maximum levels. The
use of these types of derivatives involves risks different from or possibly
greater than, the risks associated with investing directly in the underlying
assets. Derivatives can be highly volatile, illiquid and difficult to value, and
there is the risk that changes in the value of a derivative held by the Fund
will not correlate with the Fund's performance. For more detailed discussion of
these investment techniques and their related risks, see Exhibit B to this proxy
statement.
DMI's Board has determined to recommend that the Fund's current
investment restriction which prohibits the Fund from purchasing securities other
than Municipal Bonds and Taxable Investments, as set forth below, be deleted.
["Purchase securities other than municipal obligations and Taxable
Investments or as provided in Investment Restriction (No. 6 with respect to
DSM; Nos. 7 and 12 with respect to DSMB) or otherwise in the Fund's
Prospectus."] * * *
VOTE REQUIRED AND THE BOARD'S RECOMMENDATION
With respect to DMI, approval of this Proposal requires the affirmative vote
of (a) 67% of the Fund's outstanding voting securities present at the meeting,
if the holders of more than 50% of the Fund's outstanding voting securities are
present or represented by proxy, or (b) more than 50% of the Fund's outstanding
voting securities, whichever is less.
THE BOARD OF DMI RECOMMENDS THAT STOCKHOLDERS OF DMI VOTE "FOR" THE FOREGOING
PROPOSAL.
PROPOSAL 3: TO EXPAND THE FUNDS' ABILITY TO INVEST IN OTHER INVESTMENT
COMPANIES
Most of the funds in the Dreyfus Family of Funds, including the Funds, have
the ability to invest in securities issued by other investment companies. The
Funds, however, are limited by their fundamental policies in the amount and
circumstances under which such investments may be made. Each Fund's Board
recommends that stockholders approve a change to the Fund's fundamental policies
to permit the Fund to invest in the securities of other investment companies to
the extent
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permitted under the 1940 Act, as described below, and make such policy
non-fundamental. Non-fundamental policies may be changed by the Fund's Board at
any time without stockholder approval.
Generally, if the changes are approved by stockholders, the Fund would be
able to invest its uninvested cash or, if it participated in a securities
lending program operated by Mellon Bank, N.A., Dreyfus' parent company, cash
collateral received from borrowers of the Fund's portfolio securities, in shares
of one or more money market funds advised by Dreyfus as described below
Under the 1940 Act, a Fund's investment in the securities of other
investment companies, subject to certain exceptions, currently is limited to (i)
3% of the total voting stock of any one investment company, (ii) 5% of the
Fund's total assets with respect to any one investment company and (iii) 10% of
the Fund's total assets in the aggregate. The Securities and Exchange Commission
(the "SEC") has granted an Exemptive Order to the Funds and Dreyfus which
generally permits each Dreyfus-managed fund to use cash collateral received from
borrowers of the fund's portfolio securities, and any other uninvested cash held
by the fund, to purchase shares of one or more institutional money market funds
advised by Dreyfus in excess of the percentage limitations imposed by the 1940
Act on investments in other investment companies. While granting relief from
such limitations for both the investment of cash collateral and other uninvested
cash, the Exemptive Order does require that a fund not invest its uninvested
cash (monies totally separate and apart from any cash collateral received in
connection with the securities lending program) in other investment companies in
excess of 25% of its total assets. To obtain a copy of the SEC notice of the
request for the Exemptive Order (Investment Company Act Release No. IC-25099
(August 29, 2001)) or the Exemptive Order (Investment Company Act Release No.
25141 (August 28, 2001)), please e-mail your request to publicinfo@sec.gov, or
write to the SEC's Public Reference Section, Washington, DC 20549-0102.
Investments in the securities of other investment companies may involve
duplication of advisory fees and other expenses. With respect to the management
fees to be earned by Dreyfus in connection with the investment of one fund's
uninvested cash, totally separate and apart from the securities lending program,
in another Dreyfus fund, Dreyfus will reduce the management fee charged the
first fund by the amount of the fee it earns in the second fund. For example, if
uninvested cash from a fund where Dreyfus is earning a 0.75% management fee were
to be invested in a money market fund where Dreyfus is earning a 0.20%
management fee, Dreyfus would reduce its fee charged to the fund on those assets
by 0.20%.
Currently, the Funds may not purchase securities of other investment
companies except (a) in the open market where no commissions except the ordinary
broker's commissions are paid, which purchases are limted to a maximum of (i) 3%
of the total voting stock of any one investment company, (ii) 5% of the Fund's
net assets with respect to any one investment company and (iii) 10% of the
Fund' s net assets in the aggregate, or (b) those received as part of a merger,
sale of assets or consolidation.
If approved by the respective Fund' s stockholders, each Fund's current
fundamental policy with respect to investing in the securities of other
investment companies would be replaced in its entirety with a non-fundamental
policy that could be changed by the Fund's Board members at any time without
stockholder approval. The non-fundamental policy would read as follows:
" The Fund may not purchase securities of other investment companies, except
to the extent permitted under the 1940 Act."
VOTE REQUIRED AND THE BOARD'S RECOMMENDATION
With respect to each Fund, approval of this Proposal requires the
affirmative vote of (a) 67% of the Fund's outstanding voting securities present
at the meeting, if the holders of more than 50% of the Fund's outstanding voting
securities are present or represented by proxy, or (b) more than 50% of the
Fund's outstanding voting securities, whichever is less.
THE BOARD OF EACH FUND RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" THE FOREGOING
PROPOSAL.
ADDITIONAL INFORMATION
SELECTION OF INDEPENDENT AUDITORS
The 1940 Act requires that each Fund's independent auditors be selected by a
majority of those Directors who are not "interested persons" (as defined in the
1940 Act) of the Fund. One of the purposes of the audit committee is to
recommend
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to the Fund' s Board the selection, retention or termination of independent
auditors for the Fund. At a meeting held on November 7, 2002, each Fund's audit
committee recommended and each Fund' s Board, including a majority of those
Directors who are not "interested persons" of the Fund, approved the selection
of Ernst & Young LLP as the Fund's independent auditors for the fiscal year
ending September 30, 2003. Ernst & Young LLP, a major international accounting
firm, has acted as auditors of each Fund since the Fund's organization. After
reviewing the Fund' s audited financial statements for the fiscal year ended
September 30, 2002, each Fund's audit committee recommended to the Fund's Board
that such statements be included in the Fund's Annual Report to stockholders. A
copy of the committee's report is attached as Exhibit D to this proxy statement
AUDIT FEES. For the fiscal year ended September 30, 2002, Ernst & Young LLP
billed DCMI, DMI and DNYMI $24,900, $28,900 and $22,500, respectively, for
services rendered in connection with the annual audit of each Fund's financial
statements. No audit fees were paid directly by Dreyfus or its affiliates to
Ernst & Young LLP during such period.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES. For the fiscal
year ended September 30, 2002, no professional services were rendered by Ernst &
Young LLP to the Funds relating to financial systems design and implementation
services. For the fiscal year ended September 30, 2002, Ernst & Young LLP did
not provide any management consulting services to Dreyfus or its affiliates.
AUDIT-RELATED FEES. For the fiscal year ended September 30, 2002, the
aggregate fees for audit-related services rendered by Ernst & Young LLP to the
Funds amounted to $4,500, $20,500 and $4,500 for DCMI, DMI and DNYMI,
respectively. Such services provided were security counts required by the SEC
and agreed upon procedures relating to DMI's APS.
ALL OTHER FEES. For the fiscal year ended September 30, 2002, the aggregate
fees for professional services rendered by Ernst & Young LLP for all other
services provided to the Funds amounted to $2,500 for each Fund relating to the
review of each Fund's income tax returns.
For the fiscal year ended September 30, 2002, Dreyfus paid Ernst & Young LLP
was paid approximately $75,000 for tax consulting services.
The audit committee for each Fund considered the compatibility of any
non-audit services with Ernst & Young LLP's independence.
A representative of Ernst & Young LLP is expected to be present at the
meeting, will have the opportunity to make a statement, and will be available to
respond to appropriate questions.
SERVICE PROVIDERS
Dreyfus, located at 200 Park Avenue, New York, New York 10166, serves as
each Fund' s investment adviser.
Mellon Bank, N.A., Dreyfus' parent, located at One Mellon Bank Center,
Pittsburgh, Pennsylvania 15258, acts as Custodian for the assets of each Fund.
Mellon Bank, N.A., located at 85 Challenger Road, Ridgefield Park, New Jersey
07660, acts as each Fund's Transfer Agent, Dividend-Paying Agent and Registrar.
VOTING INFORMATION
Each Fund will bear its pro rata share of the cost of
soliciting proxies based on the net assets of the Fund. In addition to the use
of the mails, proxies may be solicited personally or by telephone, and each Fund
may pay persons holding shares of the Fund in their names or those of their
nominees for their expenses in sending soliciting materials to their principals.
Each Fund has retained Georgeson Shareholder Communications, Inc. ("Georgeson"),
17 State Street, New York, NY 10004, to assist in the solicitation of proxies
primarily by contacting stockholders by telephone, which will cost approximately
$40,000, such cost to be borne pro rata among the Funds based on the net assets
of the Funds. As the meeting date approaches, certain stockholders may receive
telephone calls from representatives of Georgeson if their votes have not been
received. Authorization to permit Georgeson to execute proxies may be obtained
by telephonic instructions from stockholders of the Funds. For additional
information regarding the proxy or to obtain a replacement proxy card, please
contact Georgeson toll-free at (866)801-3357. Authorizations to execute proxies
may be obtained by fax or by telephonic instructions in accordance with
procedures designed to authenticate the stockholder's identity. In all cases
where a telephonic proxy is solicited, the stockholder will be asked to provide
his or her address and social security number (in the case of an individual) or
taxpayer identification number (in the case of a non-individual) and to confirm
that the stockholder has received the Fund's proxy statement and proxy card in
the mail. Within 72 hours of receiving a stockholder's solicited telephonic
voting instructions, a confirmation will be sent to the stockholder to ensure
that the vote has been taken in accordance with the stockholder's instructions
and to provide a telephone number to call immediately if the stockholder's
instructions are not correctly reflected in the confirmation. Shares represented
by executed and unrevoked proxies will be voted in accordance with the
specifications made thereon, and if no voting instructions are given, shares
will be voted "FOR" the Proposals. If a proxy is properly executed and returned
accompanied by instructions to withhold authority to vote, represents a broker
"non-vote" (that is, a proxy from a broker or nominee indicating that such
person has not received instructions from the beneficial owner or other person
entitled to vote shares of the Fund on a particular matter with respect to which
the broker or nominee does not have discretionary power) or marked with an
abstention (collectively, " abstentions" ), the Fund's shares represented
thereby will be considered to be present at the meeting for purposes of
determining the existence of a quorum for the transaction of business. Under
Maryland law, abstentions do not constitute a vote "for" or "against" a matter
and will be disregarded in determining "votes cast" on an issue. For this
reason, abstentions will have the effect of a "no" vote for the purpose of
obtaining requisite approval for Proposal 2 or Proposal 3.
If a quorum is not present at the meeting, or if a quorum is present but
sufficient votes to approve Proposal 2 or Proposal 3 are not received, the
persons named as proxies may propose one or more adjournments of the meeting to
permit further solicitation of proxies with respect to such Proposal. In
determining whether to adjourn the meeting, the following factors may be
considered: the nature of the Proposal, the percentage of favorable votes
actually cast, the percentage of negative votes actually cast, and the nature of
any further solicitation. Any adjournment will require the affirmative vote of a
majority of those shares affected by the adjournment that are represented at the
meeting in person or by proxy. If a quorum is present, the persons named as
proxies will vote those proxies which they are entitled to vote "FOR" the
Proposal in favor of such adjournment, and will vote those proxies required to
be voted "AGAINST" the Proposal against any adjournment.
OTHER MATTERS
No Fund' s Board is aware of any other matter which may come before the
meeting. However, should any such matter with respect to one or more Funds
properly come before the meeting, it is the intention of the persons named in
the accompanying form of proxy to vote the proxy in accordance with their
judgment on such matter.
Proposals that stockholders wish to include in a Fund's proxy statement for
the Fund' s next Annual Meeting of Stockholders must be sent to and received by
such Fund no later than December 12, 2003 at the principal executive offices of
the Fund at 200 Park Avenue, New York, New York 10166, Attention: General
Counsel. The date after which notice of a stockholder proposal is considered
untimely, except as otherwise permitted under applicable law, is February 25,
2004.
NOTICE TO BANKS, BROKER/DEALERS AND
VOTING TRUSTEES AND THEIR NOMINEES
Please advise the appropriate Fund, in care of Mellon Bank, N.A., c/o Proxy
Services Corporation, 115 Amity Street, Jersey City, New Jersey 07304, whether
other persons are the beneficial owners of the shares for which proxies are
being solicited and, if so, the number of copies of the proxy statement and
other soliciting material you wish to receive in order to supply copies to the
beneficial owners of shares.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, STOCKHOLDERS WHO
DO NOT EXPECT TO ATTEND THE MEETING IN PERSON ARE URGED TO COMPLETE, SIGN, DATE
AND RETURN EACH ENCLOSED PROXY CARD IN THE ENCLOSED STAMPED ENVELOPE.
Dated: April 18, 2003
(PAGE 8)
EXHIBIT A
PART I
Part I sets forth information regarding the Continuing Directors who are not
Nominees for election at this meeting, Board and committee meetings and share
ownership. Unless otherwise indicated, the information set forth herein applies
to all Funds.
DMI, DCMI AND DNYMI -- CONTINUING CLASS II AND CLASS III DIRECTORS
WITH TERMS EXPIRING IN 2004 FOR CLASS II AND 2005 FOR CLASS III
The following table presents informatioin about the Continuing Directors of
the Funds, including their principal occupations and other board memberships and
affiliations. The address of each Continuing Director is 200 Park Avenue, New
York, New York 10166. Each of the Fund's Continuing Directors will continue to
serve as a Director of the Funds after the meeting.
NAME (AGE) OF CONTINUING DIRECTOR PRINCIPAL OCCUPATION OTHER BOARD MEMBERSHIPS
POSITION WITH FUND (SINCE) DURING PAST 5 YEARS AND AFFILIATIONS
JOSEPH S. DIMARTINO (59) Corporate Director and Trustee The Muscular Dystrophy
CHAIRMAN OF THE BOARD OF Association, DIRECTOR
EACH FUND (1995 Levcor International, Inc.,
CLASS III DIRECTOR OF an apparel fabric processor, DIRECTOR
EACH FUND (1995) Century Business Services,
Inc., a provider of outsourcing
functions for small and medium size
companies, DIRECTOR
The Newark Group, a
provider of a national market of
paper recovery facilities, paperboard
mills and paperboard converting plants, DIRECTOR
GEORGE L. PERRY (69) Economist and Senior Fellow at State Farm Mutual Auto-
CLASS III DIRECTOR OF Brookings Institution mobile Association, DIRECTOR
EACH FUND (1989) State Farm Life Insurance
APS DESIGNEE FOR DMI (2002) Company, DIRECTOR
WHITNEY I. GERARD (68) Partner of Chadbourne & Parke LLP None
CLASS II DIRECTOR OF EACH FUND (1988)
APS DESIGNEE FOR DMI (2000)
ARTHUR A. HARTMAN (77) Chairman of First NIS Regional APCO Associates Inc.,
CLASS II DIRECTOR OF EACH FUND (1989) Fund (ING/Barings Management) and SENIOR CONSULTANT
New Russia Fund
Advisory Member Council to Barings,
Vostok
A-1
(PAGE A-1)
The table below indicates the dollar range of each Continuing Director's and
Nominee' s ownership of shares of each Fund's Common Stock and shares of other
funds in the Dreyfus Family of Funds for which he or she is a Board member, in
each case as of December 31, 2002.
DMI DCMI DNYMI AGGREGATE HOLDING OF
NAME OF CONTINUING COMMON COMMON COMMON FUNDS IN THE
DIRECTOR OR NOMINEE STOCK STOCK STOCK DREYFUS FAMILY OF FUNDS
Joseph S. DiMartino None None None Over $100,000
George L. Perry None None None None
Whitney I. Gerard None None None Over $100,000
Arthur A. Hartman None None None None
Lucy Wilson Benson* None None None Over $100,000
David W. Burke* None None None Over $100,000
Clifford L. Alexander, Jr.* None None None None
------------------------------------
* Nominee.
As of December 31, 2002, none of the Nominees or Continuing Directors or
their immediate family members owned securities of Dreyfus or any person (other
than a registered investment company) directly or indirectly controlling,
controlled by or under common control with Dreyfus.
PERTAINING TO THE BOARD OF EACH FUND
* DMI held nine Board meetings, DCMI held ten Board meetings, DNYMI held
eight Board meetings and each Fund held four audit committee meetings,
during the last fiscal year.
* All Continuing Directors and Nominees (who were Directors at the time)
attended at least 75% of all Board and committee meetings, as applicable,
held in the last fiscal year.
COMPENSATION TABLE. The aggregate amount of compensation paid to each
Continuing Director by each Fund for the fiscal year ended September 30, 2002
and by all funds in the Dreyfus Family of Funds for which such Continuing
Director was a Board member (the number of portfolios of such funds is set forth
in parenthesis next to each Director's total compensation) for the year ended
December 31, 2002, was as follows:
AGGREGATE AGGREGATE AGGREGATE TOTAL COMPENSATION FROM
NAME OF COMPENSATION FROM COMPENSATION FROM COMPENSATION FROM THE FUNDS AND FUND COMPLEX
CONTINUING DIRECTOR DMI* DCMI* DNYMI* PAID TO CONTINUING DIRECTOR (**)
Joseph S. DiMartino $2,389 $874 $212 $815,938 (191)
George L. Perry $1,910 $1,198 $172 $78,500 (16)
Whitney I. Gerard $1,910 $1,198 $172 $79,000 (16)
Arthur A. Hartman $1,900 $1,197 $170 $78,500 (16)
------------------------------------
* Amount does not include reimbursed expenses for attending Board meetings,
which amounted to $2,393, $1,834 and $1,395 for DMI, DCMI and DNYMI,
respectively, for all Board members as a group.
** Represents the number of separate portfolios comprising the investment
companies in the fund complex, including the Funds, for which the Board
member serves.
A-2
(PAGE A-2)
PART II
Part II sets forth information relevant to the officers of each Fund.
NAME AND POSITION PRINCIPAL OCCUPATION AND BUSINESS
WITH FUNDS (SINCE) AGE EXPERIENCE FOR PAST FIVE YEARS
STEPHEN E. CANTER
President (2000) 57 Chairman of the Board, Chief
Executive Officer and Chief Operating
Officer of Dreyfus, and an officer of 94
investment companies (comprised of 186
portfolios) managed by Dreyfus. Mr.
Canter also is a Board Member and,
where applicable, an Executive Committee
Member of the other investment management
subsidiaries of Mellon Financial
Corporation, each of which is an affiliate of Dreyfus.
STEPHEN R. BYERS
Executive Vice President (2002) 49 Chief Investment Officer, Vice Chairman
and a Director of Dreyfus, and an
officer of 94 investment companies (comprised
of 186 portfolios) managed by Dreyfus. Mr. Byers also
is an Officer, Director or an Executive Committee Member
of certain other investment management subsidiaries
of Mellon Financial Corporation, each of which is an
affiliate of Dreyfus. Prior to joining Dreyfus,
he served as an Executive Vice President - Capital
Markets, Chief Financial Officer and Treasurer at Gruntal
& Co., LLC.
MARK N. JACOBS
Vice President (2000) 56 Executive Vice President, General Counsel and
Secretary of Dreyfus, and an officer of 95 investment
companies (comprised of 202 portfolios) managed by Dreyfus.
JAMES WINDELS
Treasurer (2001) 44 Director - Mutual Fund Accounting of Dreyfus, and
an officer of 95 investment companies (comprised of 202 portfolios)
managed by Dreyfus.
PAUL DISDIER
Executive Vice President (2000)- 47 Director of Dreyfus Municipal Securities, and Dreyfus
California Municipal Income, Inc.an officer of three
investment companies (comprised of three portfolios) managed by
Dreyfus.
JOSEPH P. DARCY
Executive Vice President (2000)- 46 Senior Portfolio Manager - Dreyfus Municipal
Dreyfus Municipal Income, Inc. Securities, and an officer of one investment company
(comprised of one portfolio) managed by Dreyfus.
A-3
(PAGE A-3)
NAME AND POSITION PRINCIPAL OCCUPATION AND BUSINESS
WITH FUNDS (SINCE) AGE EXPERIENCE FOR PAST FIVE YEARS
MONICA S. WIEBOLDT
Executive Vice President (2000) - 53 Senior Portfolio Manager - Dreyfus Municipal
Dreyfus New York Municipal Income, Inc. Securities, and an officer of
one investment company (comprised of one portfolio)
managed by Dreyfus.
MICHAEL A. ROSENBERG
Secretary (2000) 43 Associate General Counsel of Dreyfus, and an officer
of 93 investment companies (comprised of 198 portfolios)
managed by Dreyfus.
STEVEN F. NEWMAN
Assistant Secretary (2000) 53 Associate General Counsel and Assistant Secretary of
Dreyfus, and an officer of 95 investment companies
(comprised of 202 portfolios) managed by Dreyfus.
ROBERT R. MULLERY
Assistant Secretary (2000) 51 Associate General Counsel of Dreyfus, and an officer
of 26 investment companies (comprised of 64 portfolios)
managed by Dreyfus.
JEFF PRUSNOFSKY
Assistant Secretary (2003) 37 Associated General Counsel of Dreyfus, and an officer
of 23 investment companies (comprised of 82 portfolios)
managed by Dreyfus.
GREGORY S. GRUBER
Assistant Treasurer (2000) 44 Senior Accounting Manager - Municipal Bond Funds of
Dreyfus, and an officer of 29 investment companies
(comprised of 58 portfolios) managed by Dreyfus.
KENNETH J. SANDGREN
Assistant Treasurer (2001) 48 Mutual Funds Tax Director of Dreyfus, and an officer of
95 investment companies (comprised of 201 portfolios)
managed by Dreyfus.
WILLIAM GERMENIS
Anti-Money Laundering Compliance 32 Vice President and Anti-Money Laundering
Officer (2002) Compliance Officer of Dreyfus Service Corporation, a
wholly-owned subsidiary of Dreyfus, and the Anti-Money
Laundering Compliance Office of 90 investment
companies (comprised of 197 portfolios) managed by
Dreyfus. He has been an employee of Dreyfus Service
Corporation since October 1998.
The address of each officer of the Funds is 200 Park Avenue, New York, New York 10166.
A-4
(PAGE A-4)
PART III
Part III sets forth information for each Fund regarding the beneficial
ownership of its shares as of March 21, 2003 by Nominees, Continuing Directors
and officers of the Fund owning shares on such date and by any shareholders
owning 5% or more of the Fund's outstanding shares.
As of March 21, 2003, each Fund's Directors and officers, as a group, owned
less than 1% of the Fund' s outstanding shares. As of March 21, 2003, the
following Directors and officers owned shares of common stock of the Funds as
indicated below:
DIRECTORS DMI DCMI DNYMI
Joseph S. DiMartino 14,000 0 0
OFFICERS
None
To each Fund' s knowledge, no person owned beneficially 5% or more of the
outstanding shares of Common Stock of a Fund or the outstanding shares of APS on
March 21, 2003. Cede & Co. held of record approximately 87%, 90% and 85% of the
outstanding Common Stock of DMI, DCMI and DNYMI, respectively, and 100% of the
outstanding shares of APS of DMI.
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCES
To each Fund's knowledge, all of its officers, Directors and holders of more
than 10% of its Common Stock or APS complied with all filing requirements under
Section 16(a) of the Securities Exchange Act of 1934, as amended, during the
fiscal year ended September 30, 2002. In making this disclosure, each Fund has
relied solely on written representations of such persons and on copies of
reports that have been filed with the Securities and Exchange Commission.
A-5
(PAGE A-5)
EXHIBIT B
If Proposal 2 is approved, DMI would be permitted to enter into swap
transactions, as described below.
Swaps, Interest Rate Locks, Caps, Collars and Floors. DMI proposes to enter
into interest rate swaps and interest rate locks and purchase and sell interest
rate caps, collars and floors. Swap transactions, including interest rate swaps,
interest rate locks, caps, collars and floors, may be individually negotiated
and include exposure to a variety of different interest rates. Swaps involve two
parties exchanging a series of cash flows at specified intervals. In the case of
an interest rate swap, the parties exchange interest payments based upon an
agreed upon principal amount (referred to as the "notional principal amount").
Under the most basic scenario, Party A would pay a fixed rate on the notional
principal amount to Party B, which would pay a floating rate on the same
notional principal amount to Party A. Swap agreements can take many forms and
are known by a variety of names.
In a typical cap or floor agreement, one party agrees to make payments only
under specified circumstances, usually in return for payment of a fee by the
other party. For example, the buyer of an interest rate cap obtains the right to
receive payments to the extent that a specified interest rate exceeds an
agreed-upon level, while the seller of an interest rate floor is obligated to
make payments to the extent that a specified interest rate falls below an
agreed-upon level. An interest rate collar combines elements of buying a cap and
selling a floor.
In a typical interest rate lock transaction, if Party A desires to lock in a
particular interest rate on a given date it may enter into an agreement to pay,
or receive a payment from, Party B based on the yield of a reference index or
security, such as a Treasury Bond. At the maturity of the term of the agreement,
one party makes a payment to the other party as determined by the relative
change in the yield of the reference security or index. An interest rate lock
transaction may be terminated prior to its stated maturity date by calculating
the payment due as of the termination date, which generally differs from the
make-whole provisions for an early termination of an interest rate swap
transaction in which the party terminating the swap early is required to give
its counterparty the economic benefit of the transaction.
DMI would set aside cash or permissible liquid assets to cover its current
obligations under swap transactions. If DMI enters into a swap agreement on a
net basis (that is, the two payment streams are netted out, with the Fund
receiving or paying, as the case may be, only the net amount of the two
payments) , the Fund would maintain cash or permissible liquid assets with a
daily value at least equal to the excess, if any, of the Fund's accrued
obligations under the swap agreement over the accrued amount the Fund is
entitled to receive under the agreement. If DMI were to enter into a swap
agreement on other than a net basis, enter into an interest rate lock agreement
or write a cap, collar or floor, it would maintain cash or permissible liquid
assets with a value equal to the full amount of the Fund's accrued obligations
under the agreement.
The most important factor in the performance of a swap agreement would be
the change in the specific interest rate or other factor(s) that determine the
amounts of payments due to and from a fund. If a swap agreement called for
payments by a fund, the fund would have to be prepared to make such payments
when due. In addition, if the counterparty's creditworthiness declines, the
value of a swap agreement would likely decline, potentially resulting in losses
The Funds would enter into interest rate swaps, interest rate locks, caps,
collars and floors only with banks and recognized securities dealers believed by
Dreyfus to present minimal credit risks. If there were a default by the other
party to such transaction DMI would have to rely on its contractual remedies
(which may be limited by bankruptcy, insolvency or similar laws) pursuant to the
agreement relating to the transaction.
Depending on the circumstances, gains from a swap transaction will be
treated either as ordinary income or as short- or long-term capital gains. The
Fund currently intends to enter into swap transactions on a "forward settlement"
basis (settlement set out several months) and to close-out such transactions
before the settlement date. This methodology should result in there being no
exchange of income and, therefore, no taxable income to report. Any principal
gain or loss at settlement would be a capital gain or loss.
B-1
(PAGE B-1)
EXHIBIT C
AUDIT COMMITTEE CHARTER
for each of
DREYFUS CALIFORNIA MUNICIPAL INCOME, INC.
DREYFUS MUNICIPAL INCOME, INC.
DREYFUS NEW YORK MUNICIPAL INCOME, INC.
(each, a "Fund")
1. The Audit Committee shall consist of at least three members and shall be
composed entirely of independent directors in accordance with the American Stock
Exchange rules ("AMEX rules"), all of whom shall be able to read and understand
fundamental financial statements, including a company's balance sheet, income
statement, and cash flow statement or will become able to do so within a
reasonable period of time after his or her appointment to the Audit Committee.
Additionally, at least one member must have past employment experience in
finance or accounting, requisite professional certification in accounting, or
any other comparable experience or background which results in the individual's
financial sophistication, including being or having been a chief executive
officer, chief financial officer or other senior officer with financial
oversight responsibilities.
2. The purposes of the Audit Committee are:
(a) to oversee the Fund's accounting and financial reporting policies and
practices, its internal controls and, as appropriate, the internal controls
of certain service providers;
(b) to oversee the quality and objectivity of the Fund's financial
statements and the independent audit thereof; and
(c) to act as a liaison between the Fund's independent auditors and the full
Board of Directors.
The function of the Audit Committee is oversight. The Fund's management is
responsible for (i) the preparation, presentation and integrity of the Fund's
financial statements, (ii) the maintenance of appropriate accounting and
financial reporting principles and policies and (iii) the maintenance of
internal controls and procedures designed to assure compliance with accounting
standards and applicable laws and regulations. The outside auditors are
responsible for planning and carrying out a proper audit and reviews. In
fulfilling their responsibilities hereunder, it is recognized that members of
the Audit Committee are not full-time employees of the Fund and are not, and do
not represent themselves to be, accountants or auditors by profession or experts
in the fields of accounting or auditing. As such, it is not the duty or
responsibility of the Audit Committee or its members to conduct "field work" or
other types of auditing or accounting reviews or procedures. Each member of the
Audit Committee shall be entitled to rely on (i) the integrity of those persons
and organizations within and outside the Fund from which it receives information
and (ii) the accuracy of the financial and other information provided to the
Audit Committee by such persons and organizations absent actual knowledge to the
contrary (which shall be promptly reported to the Fund's Board). In addition,
the evaluation of the Fund's financial statements by the Audit Committee is not
of the same quality as audits performed by the independent accountants, nor does
the Audit Committee' s evaluation substitute for the responsibilities of the
Fund' s management for preparing, or the independent accountants for auditing,
the financial statements.
3. To carry out its purposes, the Audit Committee shall have the following
duties and powers:
(a) to recommend the selection, retention or termination of outside auditors
and, in connection therewith, to evaluate the independence of the auditors,
including whether the auditors provide any consulting services to the
Fund's investment adviser (it being understood that the auditors are
ultimately accountable to the Audit Committee and the Fund's Board and that
the Audit Committee and the Fund' s Board shall have the ultimate authority
and responsibility to select, evaluate, retain and terminate auditors,
subject to any required stockholder vote);
(b) to ensure receipt of a formal written statement from the outside
auditors on a periodic basis specifically delineating all relationships
between the auditors and the Fund; to discuss with the auditors any
disclosed relation-
C-1
(PAGE C-1)
ships or services that may impact the auditors' objectivity and
independence; and to take, or recommend that the full Board take,
appropriate action to oversee the independence of the auditors;
(c) to meet with the Fund's outside auditors, including private meetings, as
necessary (i) to review the arrangements for and scope of the annual audit
and any special audits; (ii) to discuss any matters of concern relating to
the Fund' s financial statements, including any adjustments to such
statements recommended by the auditors, or other results of said audit(s);
and (iii) to consider the auditors' comments with respect to the Fund's
financial policies, procedures and internal accounting controls and
management's responses thereto;
(d) to consider the effect upon the Fund of any changes in accounting
principles or practices proposed by management or the outside auditors;
(e) to review the fees charged by the outside auditors for audit and
non-audit services; and
(f) to report its activities to the full Board on a periodic basis and to
make such recommendations with respect to the above and other matters
as the Audit Committee may deem necessary or appropriate.
4. The Audit Committee shall meet at least once annually and is empowered to
hold special meetings as circumstances require.
5. The Audit Committee shall regularly meet (typically, concurrently with the
regular Committee meetings) with the Fund's management.
6. The Audit Committee shall have the resources and authority appropriate to
discharge its responsibilities, including the authority to retain
special counsel and other experts or consultants at the expense of the Fund.
7. The Audit Committee shall review the adequacy of this Charter at least
annually and recommend any changes to the full Board. The Board shall
also review and approve this Charter at least annually.
8. The Fund shall provide the American Stock Exchange written confirmation
regarding:
(1) the adoption of this formal written Charter and the Audit Committee's
annual review and reassessment of the adequacy of this Charter;
(2) the composition of the Audit Committee consisting of at least three
members and comprised solely of independent directors;
(3) any determination that the Fund' s Board has made regarding the
independence of directors pursuant to the AMEX rules or applicable law;
(4) the financial literacy of the Audit Committee members as provided in
the AMEX rules; and
(5) the determination that at least one of the Audit Committee members has
accounting or related financial management expertise as provided in
the AMEX rules.
Effective: June 14, 2000
As Amended, May 2, 2002
C-2
(PAGE C-2)
EXHIBIT D
Dreyfus California Municipal Income, Inc.
Dreyfus Municipal Income, Inc.
Dreyfus New York Municipal Income, Inc.
REPORT OF THE AUDIT COMMITTEE
The audit committee oversees the Funds' financial reporting process on behalf of
the board of directors. Management has the primary responsibility for the
financial statements and the reporting process including the systems of internal
controls. In fulfilling its oversight responsibilities, the committee reviewed
the audited financial statements in the Annual Report with management including
a discussion of the quality, not just the acceptability, of the accounting
principles, the reasonableness of significant judgments, and the clarity of
disclosures in the financial statements.
The committee reviewed with the independent auditors, who are responsible for
expressing an opinion on the conformity of those audited financial statements
with generally accepted accounting principles, their judgments as to the
quality, not just the acceptability, of the Funds' accounting principles and
such other matters as are required to be discussed with the committee under
generally accepted auditing standards. In addition, the committee has discussed
with the independent auditors the auditors' independence from management and the
Funds including the auditor's letter and the matters in the written disclosures
required by the Independence Standards Board and considered the compatibility of
non-audit services with the auditors' independence.
The committee discussed with the Funds' independent auditors the overall scope
and plans for the audits. The committee meets with the independent auditors,
with and without management present, to discuss the results of their
examinations, their evaluations of the Funds' internal controls, and the overall
quality of the Funds' financial reporting.
In reliance on the reviews and discussions referred to above, the committee
recommended to the board of directors (and the board has approved) that the
audited financial statements be included in the Annual Report to Shareholders
for the year ended September 30, 2002. The committee and the board also have
approved the selection of Ernst & Young LLP as the Funds' independent auditors.
George L. Perry, Audit Committee Chair
Lucy Wilson Benson, Audit Committee Member
David W. Burke, Audit Committee Member
Joseph S. DiMartino, Audit Committee Member
Whitney I. Gerard, Audit Committee Member
Arthur A. Hartman, Audit Committee Member
November 7, 2002
D-1
(PAGE D-1)
IMPORTANT
Please Act Promptly
Sign, Date and Mail your Proxy Card(s) Today.
No matter how many shares you own, your vote is important. Voting can
also help the Fund save money. To hold a meeting, a quorum must be
represented. Voting today can save the fund the expense of another
solicitation for proxies required to achieve a quorum.
Please note that if you hold more than one account in the Fund, a proxy
card will be sent to you for each of your accounts. You should sign and
return each proxy card in order for all votes to be counted.
Thank you for your interest in the Fund.
DREYFUS MUNICIPAL INCOME, INC.
COMMON STOCKHOLDERS
AND
AUCTION PREFERRED STOCKHOLDERS
The undersigned stockholder of Dreyfus Municipal Income, Inc. (the "Fund")
hereby appoints Robert R. Mullery and Emile R. Molineaux, and each of them, the
attorneys and proxies of the undersigned, with full power of substitution, to
vote, as indicated herein, all of the shares of the Fund standing in the name of
the undersigned at the close of business on March 21, 2003 at the Annual Meeting
of Stockholders to be held at the offices of The Dreyfus Corporation, 200 Park
Avenue, 7th Floor West, New York, New York, commencing at 10:00 a.m. on Friday,
May 23, 2003; and at any and all adjournments thereof, with all of the powers
the undersigned would possess if then and there personally present and
especially (but without limiting the general authorization and power hereby
given) to vote as indicated on the proposals, as more fully described in the
Proxy Statement for the meeting.
................................................................................
FOLD AND DETACH HERE
Please mark Boxes in blue or black ink.
1. Election of Directors
___ FOR ALL Nominees listed below (except as marked to the contrary) ___
WITHHOLD Authority For All Nominees listed below
Nominees are:
Class I - Lucy Wilson Benson, David W. Burke and Clifford L. Alexander, Jr.
WITHHELD FOR (write name of nominee(s) in space provided below)
------------------------------------------------------------------------
2. To approve a change to the fundamental investment policies and investment
restrictions of the Fund to permit the Fund to engage in additional
investment techniques:
FOR AGAINST ABSTAIN
[_] [_] [_]
3. To approve a change to the fundamental investment policies and investment
restrictions of the Fund to expand the Fund's ability to invest in other
investment companies:
FOR AGAINST ABSTAIN
[_] [_] [_]
4. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting or any adjournment(s)
thereof.
THIS PROXY IS SOLICITED BY THE FUND'S BOARD OF DIRECTORS AND WILL BE VOTED FOR
THE ABOVE PROPOSALS UNLESS OTHERWISE INDICATED.
Signature(s) should be exactly as name or names appearing on this proxy. If
shares are held jointly, each holder should sign. If signing is by attorney,
executor, administrator, trustee or guardian, please give full title.
Dated:____________________________, 2003
---------------------------------
Signature(s)
---------------------------------
Signature(s)
Sign, Date and return the Proxy Card Promptly using the Enclosed Envelope