Van Kampen Unit Trusts to offer investment-grade municipal trust units

By Toni Weeks

San Diego, Oct. 17 - Van Kampen Unit Trusts, municipal series 1023 has registered units of its series 135 investment-grade municipal trust, according to a form S-6 amendment filed with the Securities and Exchange Commission.

The depositor is Houston-based Van Kampen Funds Inc.

The trust seeks to provide federal tax-exempt income and to preserve capital by investing in a portfolio of tax-exempt municipal bonds. The estimated current return paid in a monthly distribution is 4.64%, and the estimated long-term return is 4.52%.

Municipal bonds selected for the trust have a Standard & Poor's rating of at least BBB- or a Moody's Investors Service rating of at least Baa3, unless the bond is not rated, in which case the bond needs credit characteristics similar to those of bonds with acceptable ratings.

In addition, the prices of bonds relative to other bonds of comparable quality and maturity, the current income provided by the bonds, the diversification of the bonds as to the issuer and the probability of early return of principal of high legal or event risk were taken into consideration during the selection process. The portfolio generally consists of bonds maturing 15 to 40 years from the date of the deposit.

The portfolio initially consists of bonds from 15 states and from the following sectors: 25% from health care, 21% from higher education, 17% general obligation, 11% from airports, 8% from utilities, 7% from transportation, 4% from water and sewer, 4% from public education, 2% from retail electric/gas/telephone and 1% certificate of participation. The weighted average maturity of the bonds is 26 years.

On the Oct. 17 inception date, $14,045,000 principal amount of bonds consisting of 15,161 units, each with a $926.39 principal amount, comprised the trust. Each unit has total annual expenses of $2.10. Distributions will be paid monthly.

The Bank of New York Mellon (800 856-8487) is the trustee.

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