UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSRS
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number 811-06570
Name of Fund: BlackRock MuniYield New Jersey Fund, Inc.
Fund Address: P.O. Box 9011
Princeton, NJ 08543-9011
Name and address of agent for service: Robert C. Doll, Jr., Chief Executive
Officer, BlackRock MuniYield New Jersey Fund, Inc., 800 Scudders Mill
Road, Plainsboro, NJ 08536. Mailing address: P.O. Box 9011, Princeton,
NJ 08543-9011
Registrant's telephone number, including area code: (800) 882-0052
Date of fiscal year end: 11/30/07
Date of reporting period: 12/01/06 - 05/31/07
Item 1 - Report to Stockholders
ALTERNATIVES BLACKROCK SOLUTIONS EQUITIES
FIXED INCOME LIQUIDITY REAL ESTATE
BlackRock MuniYield BLACKROCK
New Jersey Fund, Inc.
SEMI-ANNUAL REPORT
MAY 31, 2007 | (UNAUDITED)
NOT FDIC INSURED
MAY LOSE VALUE
NO BANK GUARANTEE
BlackRock MuniYield New Jersey Fund, Inc.
The Benefits and Risks of Leveraging
BlackRock MuniYield New Jersey Fund, Inc. utilizes leveraging to seek to enhance
the yield and net asset value of its Common Stock. However, these objectives
cannot be achieved in all interest rate environments. To leverage, the Fund
issues Preferred Stock, which pays dividends at prevailing short-term interest
rates, and invests the proceeds in long-term municipal bonds. The interest
earned on these investments, net of dividends to Preferred Stock, is paid to
Common Stock shareholders in the form of dividends, and the value of these
portfolio holdings is reflected in the per share net asset value of the Fund's
Common Stock. However, in order to benefit Common Stock shareholders, the yield
curve must be positively sloped; that is, short-term interest rates must be
lower than long-term interest rates. At the same time, a period of generally
declining interest rates will benefit Common Stock shareholders. If either of
these conditions change, then the risks of leveraging will begin to outweigh the
benefits.
To illustrate these concepts, assume a fund's Common Stock capitalization of
$100 million and the issuance of Preferred Stock for an additional $50 million,
creating a total value of $150 million available for investment in long-term
municipal bonds. If prevailing short-term interest rates are approximately 3%
and long-term interest rates are approximately 6%, the yield curve has a
strongly positive slope. The fund pays dividends on the $50 million of Preferred
Stock based on the lower short-term interest rates. At the same time, the fund's
total portfolio of $150 million earns the income based on long-term interest
rates.
In this case, the dividends paid to Preferred Stock shareholders are
significantly lower than the income earned on the fund's long-term investments,
and therefore the Common Stock shareholders are the beneficiaries of the
incremental yield. However, if short-term interest rates rise, narrowing the
differential between short-term and long-term interest rates, the incremental
yield pickup on the Common Stock will be reduced or eliminated completely. At
the same time, the market value of the fund's Common Stock (that is, its price
as listed on the New York Stock Exchange) may, as a result, decline.
Furthermore, if long-term interest rates rise, the Common Stock's net asset
value will reflect the full decline in the price of the portfolio's investments,
since the value of the fund's Preferred Stock does not fluctuate. In addition to
the decline in net asset value, the market value of the fund's Common Stock may
also decline.
As of May 31, 2007, the Fund's leverage amount, due to Auction Market Preferred
Stock, was 35.22% of total net assets, before the deduction of Preferred Stock.
As a part of its investment strategy, the Fund may invest in certain securities
whose potential income return is inversely related to changes in a floating
interest rate ("inverse floaters"). In general, income on inverse floaters will
decrease when short-term interest rates increase and increase when short-term
interest rates decrease. Investments in inverse floaters may be characterized as
derivative securities and may subject the Fund to the risks of reduced or
eliminated interest payments and losses of invested principal. In addition,
inverse floaters have the effect of providing investment leverage and, as a
result, the market value of such securities will generally be more volatile than
that of fixed-rate, tax-exempt securities. To the extent the Fund invests in
inverse floaters, the market value of the Fund's portfolio and the net asset
value of the Fund's shares may also be more volatile than if the Fund did not
invest in these securities. (See Note 1(c) to Financial Statements for details
of municipal bonds held in trust.)
2 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
A Letter to Shareholders
Dear Shareholder
The 12 months from May 2006 to May 2007 took global equities on an extraordinary
ride. A sharp correction at the start, the first in almost four years, gave way
to strength in the latter half of 2006 and early 2007. This rally was
interrupted by another set-back at the end of February, before markets resumed
their upward march through May 31. Ultimately, the tailwinds of a generally
favorable global economic backdrop, tame inflation, relatively low interest
rates, still positive earnings growth and attractive valuations prevailed over
the headwinds of a weakening U.S. economy, slowing housing market, escalating
geopolitical concerns and high energy prices. In fact, both the Dow Jones
Industrial Average and the Standard & Poor's 500 Index touched new record highs
following the most recent correction.
Mixed economic signals led to volatile behavior in fixed income markets as well.
However, from the beginning of 2007 through May 31, short-term bond yields
generally fell while longer-term yields increased. This resulted in some
re-steepening of the yield curve, which had been flat to inverted throughout
2006. On a year-over-year basis, yields on 30-year Treasury bonds fell 20 basis
points (.20%) and 10-year yields fell 22 basis points, while bond prices
correspondingly rose. Meanwhile, the Federal Reserve Board (the Fed) has left
the federal funds rate at 5.25% since first pausing in August 2006. While
first-quarter gross domestic product growth of 0.6% represented the slowest rate
of expansion since 2002, the Fed reiterated its view that inflation, not a
slowing economy, remains its primary concern. Many observers interpreted the
Fed's reaction to mean that the economy has hit its low and is bound for renewed
strength, therefore reducing the likelihood of an interest rate cut in the near
future.
Against this backdrop, most major market indexes posted positive returns for the
annual and semi-annual reporting periods ended May 31, 2007, with equities
exhibiting particular strength:
Total Returns as of May 31, 2007 6-month 12-month
=====================================================================================================================
U.S. equities (Standard & Poor's 500 Index) +10.29% +22.79%
---------------------------------------------------------------------------------------------------------------------
Small cap U.S. equities (Russell 2000 Index) + 8.39 +18.92
---------------------------------------------------------------------------------------------------------------------
International equities (MSCI Europe, Australasia, Far East Index) +14.08 +26.84
---------------------------------------------------------------------------------------------------------------------
Fixed income (Lehman Brothers Aggregate Bond Index) + 0.69 + 6.66
---------------------------------------------------------------------------------------------------------------------
Tax-exempt fixed income (Lehman Brothers Municipal Bond Index) + 0.30 + 4.84
---------------------------------------------------------------------------------------------------------------------
High yield bonds (Lehman Brothers U.S. Corporate High Yield 2% Issuer Cap Index) + 6.02 +12.64
---------------------------------------------------------------------------------------------------------------------
We expect market volatility to linger throughout the remainder of 2007. As you
navigate the uncertainties, we encourage you to review your investment goals
with your financial professional and to make portfolio changes, as needed. For
more insight, we invite you to view "What's Ahead in 2007: An Investment
Perspective" and "Are You Prepared for Volatility?" at www.blackrock.com/funds.
We thank you for entrusting BlackRock with your investment assets, and we look
forward to continuing to serve you in the months and years ahead.
Sincerely,
/s/ Robert C. Doll, Jr.
Robert C. Doll, Jr.
Fund President and Director
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 3
A Discussion With Your Fund's Portfolio Manager
Our focus on improving distributable income for shareholders and
increasing the Fund's capital appreciation potential led us to invest largely on
the long end of the municipal yield curve.
Describe the recent market environment relative to municipal bonds.
Long-term bond yields rose sharply over the past six months while bond prices,
which move opposite of yields, fell. Strong U.S. equity markets, continued
moderate employment growth and mounting investor conviction that the Federal
Reserve Board (the Fed) would keep interest rates steady for the remainder of
the year combined to push bond prices lower in recent months.
At the end of May 2007, 30-year U.S. Treasury bond yields stood at 5.01%, having
increased 45 basis points (.45%) during the six-month period to reach their
highest level in nearly a year. Ten-year Treasury note yields rose 49 basis
points to 4.90% during the same period. In the tax-exempt market, strong
investor demand allowed municipal bond prices to decline less than their taxable
counterparts. As measured by Municipal Market Data, yields on AAA-rated
tax-exempt bonds maturing in 30 years increased 34 basis points to 4.25%. Yields
on similarly rated 10-year issues increased 35 basis points to end the period at
3.91%.
Investor demand for municipal product continued to strengthen throughout the
six-month reporting period, as new-issue supply increased. Statistics from the
Investment Company Institute indicate that long-term municipal bond funds
received more than $10.1 billion in net new cash flows during the first four
months of 2007, a 71% increase versus the first four months of 2006. Meanwhile,
issuance of new long-term municipal bonds totaled more than $230 billion during
the six-month reporting period, an increase of over 35% compared to the same six
months a year ago.
The increase in new bond supply seen so far this year appears unlikely to abate
significantly. As such, investor demand will be critical in maintaining the
tax-exempt market's strong technical position. We expect that both traditional
and non-traditional investors will continue to be drawn to the municipal market
given the relative stability of tax-exempt yield ratios in recent months and the
steepness of the municipal yield curve compared to the taxable curve. We believe
this should help to support the market's performance in the months ahead.
Describe conditions in the State of New Jersey.
The State of New Jersey ended the period with ratings of Aa3, AA and AA- from
Moody's, Standard & Poor's and Fitch, respectively, with stable outlooks from
all three agencies. New Jersey ranks fourth in both debt per capita and debt as
a percent of personal income, according to Moody's. It ranked second in per
capita income in 2006 (preliminary), according to the U.S. Department of
Commerce. New Jersey's May 2007 unemployment rate was 4.3%, below the national
rate of 4.5%.
Recently, Governor Corzine signed legislation approving a tax reform measure
that cuts property taxes for most New Jersey residents by 20% and imposes an
annual 4% cap on property tax increases by municipalities and school districts,
although various spending exemptions exist. In February, the governor presented
a fiscal year 2008 budget totaling $33.3 billion, a 7% increase (or $2.2
billion) from the prior fiscal year. The majority of the spending increase
(approximately $1.9 billion) is dedicated to the abovementioned property tax
relief and will be funded by projected reserves at the end of fiscal year 2007
and projected base growth in fiscal year 2008. Budgetary pressures from retired
employees' healthcare and pension costs remain a key credit concern, especially
as the amounts and uses of past pension contributions are now in question.
How did the Fund perform during the period?
For the six-month period ended May 31, 2007, the Common Stock of BlackRock
MuniYield New Jersey Fund, Inc. had net annualized yields of 4.53% and 4.70%,
based on a period-end per share net asset value of $15.41 and a per share market
price of $14.85, respectively, and $.348 per share income dividends. Over the
same period, the total investment return on the Fund's Common Stock was -.83%,
based on a change in per share net asset value from $15.90 to $15.41, and
assuming reinvestment of all distributions.
The Fund's total return, based on net asset value, lagged the -.68% average
return of the Lipper New Jersey Municipal Debt Funds category for the six-month
period. (Funds in this Lipper category limit their investment to those
securities exempt from taxation in New Jersey or a city in New Jersey.) As in
the past, the Fund's inability to invest in non-investment grade credits had a
negative effect on performance and income relative to the Lipper category
average, as
4 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
lower-quality issues continued to outperform throughout the reporting period.
Another detractor from performance was the ongoing effect of a low-interest-rate
environment wherein the Fund's higher-coupon bonds continued to be called away.
In an environment where we cannot replace the higher yields lost to calls, this
phenomenon dampened the distribution rate of the Fund. Our investing largely on
the long end of the municipal yield curve during the period also hindered
performance somewhat. While this strategy added above-market yield to the
portfolio, it also increased volatility, which resulted in slightly greater than
average net asset value deterioration when the market sold off. Lastly, the
Fund's healthcare holdings detracted from overall performance as a recent surge
of issuance in the sector and a growing perception among investors of increased
risks associated with hospital- and healthcare-backed bonds depressed
valuations.
For a description of the Fund's total investment return based on a change in the
per share market value of the Fund's Common Stock (as measured by the trading
price of the Fund's shares on the New York Stock Exchange), and assuming
reinvestment of distributions, please refer to the Financial Highlights section
of this report. As a closed-end fund, the Fund's shares may trade in the
secondary market at a premium or discount to the Fund's net asset value. As a
result, total investment returns based on changes in the market value of the
Fund's Common Stock may vary significantly from total investment returns based
on changes in the Fund's net asset value.
What changes were made to the portfolio during the period?
Portfolio activity reflected our efforts to improve the Fund's distribution
rate.
New issuance of New Jersey municipal bonds was up 11% versus the same six months
a year ago. Practically all of the increase was attributed to the state's
refunding of $3.6 billion in bonds issued as part of the tobacco industry
settlement. The tobacco bond refunding provided a gain for the Fund via the
price appreciation associated with the prerefunding of existing holdings, and
allowed us to maintain our exposure to this sector. Excluding the tobacco
settlement bonds, new issuance was down 42.4%.
Key purchases during the semi-annual period included new-issue housing bonds,
Puerto Rico bonds and out-of-favor coupons (mainly discounted bonds), each of
which offers above-market yield and enhances the portfolio's liquidity and
potential for capital appreciation. Conversely, we continued to trim the
portfolio's short-term holdings, specifically shorter-dated prerefunded bonds
and high-coupon, short-call bonds (primarily those having a call date within
three years or less). These bonds are priced with a premium and, as the call
date approaches, their value depreciates at an accelerating rate and they
generally underperform the overall market. Although this move temporarily hurts
distributable income, we believe it is a worthwhile trade-off to protect the
future total return potential of the Fund.
For the six-month period ended May 31, 2007, the Fund's Auction Market Preferred
Stock had an average yield of 3.30% for Series A, 3.31% for Series B and 3.28%
for Series C. There was no material change in the Fund's borrowing costs over
the course of the period, as the Fed kept the federal funds target interest rate
steady at 5.25% since first pausing last August. Although flat by historical
standards, the tax-exempt yield curve maintained a positive slope throughout the
period (particularly compared to the U.S. Treasury yield curve), allowing us to
borrow at a lower rate than where we invest. This continued to generate an
income benefit to the holders of Common Stock from the leveraging of Preferred
Stock. However, should the spread between short-term and long-term interest
rates narrow, the benefits of leverage will decline and, as a result, reduce the
yield on the Fund's Common Stock. (For a more complete explanation of the
benefits and risks of leveraging, see page 2 of this report to shareholders.)
How would you characterize the Fund's position at the close of the period?
We maintained a fully invested portfolio throughout and ended the period with a
slightly longer duration than that of our comparable Lipper group. Going
forward, we will continue to focus our efforts on identifying compelling
relative value trading opportunities, while seeking to enhance the Fund's yield
and capital appreciation potential. We also will seek additional opportunities
to sell shorter-dated bonds and reinvest those proceeds in attractive,
longer-dated bonds.
Timothy T. Browse, CFA
Portfolio Manager
June 26, 2007
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 5
Portfolio Information as of May 31, 2007
Percent of
Quality Ratings by Total
S&P/Moody's Investments
--------------------------------------------------------------------------------
AAA/Aaa .......................................................... 59.5%
AA/Aa ............................................................ 10.7
A/A .............................................................. 9.4
BBB/Baa .......................................................... 17.3
BB/Ba ............................................................ 0.6
CCC/Caa .......................................................... 0.5
NR (Not Rated) ................................................... 1.4
Other* ........................................................... 0.6
--------------------------------------------------------------------------------
* Includes portfolio holdings in short-term investments.
Dividend Policy
The Fund's dividend policy is to distribute all or a portion of its net
investment income to its shareholders on a monthly basis. In order to provide
shareholders with a more stable level of dividend distributions, the Fund may at
times pay out less than the entire amount of net investment income earned in any
particular month and may at times in any month pay out such accumulated but
undistributed income in addition to net investment income earned in that month.
As a result, the dividends paid by the Fund for any particular month may be more
or less than the amount of net investment income earned by the Fund during such
month. The Fund's current accumulated but undistributed net investment income,
if any, is disclosed in the Statement of Net Assets, which comprises part of the
financial information included in this report.
Swap Agreements
The Fund may invest in swap agreements, which are over-the-counter contracts in
which one party agrees to make periodic payments based on the change in market
value of a specified bond, basket of bonds, or index in return for periodic
payments based on a fixed or variable interest rate or the change in market
value of a different bond, basket of bonds or index. Swap agreements may be used
to obtain exposure to a bond or market without owning or taking physical custody
of securities. Swap agreements involve the risk that the party with whom the
Fund has entered into the swap will default on its obligation to pay the Fund
and the risk that the Fund will not be able to meet its obligations to pay the
other party to the agreement.
6 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
Schedule of Investments as of May 31, 2007 (Unaudited) (in Thousands)
Face
Amount Municipal Bonds Value
================================================================================
New Jersey -- 137.5%
--------------------------------------------------------------------------------
$ 1,000 Burlington County, New Jersey, Bridge Commission
Revenue Bonds (Governmental Leasing Program),
5.25% due 8/15/2012 (f) $ 1,065
--------------------------------------------------------------------------------
1,500 Delaware River and Bay Authority Revenue Bonds,
5% due 1/01/2033 (d) 1,554
--------------------------------------------------------------------------------
Delaware River Joint Toll Bridge Commission of
New Jersey and Pennsylvania, Bridge Revenue
Refunding Bonds:
2,010 5% due 7/01/2021 2,080
3,645 5% due 7/01/2028 3,757
--------------------------------------------------------------------------------
2,620 Essex County, New Jersey, Improvement Authority
Revenue Bonds, Series A, 5% due 10/01/2013 (b)(f) 2,783
--------------------------------------------------------------------------------
Garden State Preservation Trust of New Jersey, Capital
Appreciation Revenue Bonds, Series B (c)(h):
6,860 5.12% due 11/01/2023 3,320
4,540 5.25% due 11/01/2028 1,711
--------------------------------------------------------------------------------
Garden State Preservation Trust of New Jersey, Open
Space and Farmland Preservation Revenue Bonds,
Series A (c):
4,300 5.80% due 11/01/2022 4,845
5,460 5.75% due 11/01/2028 6,535
--------------------------------------------------------------------------------
Gloucester County, New Jersey, Improvement Authority,
Solid Waste Resource Recovery, Revenue Refunding
Bonds (Waste Management Inc. Project):
1,180 AMT, Series B, 7% due 12/01/2029 1,255
2,000 Series A, 6.85% due 12/01/2029 2,126
--------------------------------------------------------------------------------
1,500 Hudson County, New Jersey, COP, Refunding,
6.25% due 12/01/2016 (d) 1,754
--------------------------------------------------------------------------------
4,500 Hudson County, New Jersey, Improvement Authority,
Facility Lease Revenue Refunding Bonds (Hudson
County Lease Project), 5.375% due 10/01/2024 (b) 4,625
--------------------------------------------------------------------------------
6,840 Jackson Township, New Jersey, School District, GO,
5% due 4/15/2012 (b)(f) 7,183
--------------------------------------------------------------------------------
Middlesex County, New Jersey, Improvement
Authority, County-Guaranteed Revenue Bonds
(Golf Course Projects):
1,455 5.25% due 6/01/2022 1,561
3,050 5% due 6/01/2029 3,183
--------------------------------------------------------------------------------
970 Middlesex County, New Jersey, Improvement Authority,
Senior Revenue Bonds (Heldrich Center Hotel/
Conference Project), Series A, 5% due 1/01/2020 985
--------------------------------------------------------------------------------
1,500 Middlesex County, New Jersey, Pollution Control
Financing Authority, Revenue Refunding Bonds
(Amerada Hess Corporation), 6.05% due 9/15/2034 1,617
--------------------------------------------------------------------------------
Monmouth County, New Jersey, Improvement Authority,
Governmental Loan Revenue Refunding Bonds (a):
2,235 5% due 12/01/2015 2,336
2,345 5% due 12/01/2016 2,451
--------------------------------------------------------------------------------
New Jersey EDA, Cigarette Tax Revenue Bonds:
1,720 5.625% due 6/15/2019 1,788
1,895 5.75% due 6/15/2029 2,036
2,000 5.75% due 6/15/2029 (k) 2,215
370 5.50% due 6/15/2031 390
755 5.75% due 6/15/2034 807
--------------------------------------------------------------------------------
New Jersey EDA, EDR (Masonic Charity Foundation of
New Jersey):
1,425 5.25% due 6/01/2024 1,501
685 5.25% due 6/01/2032 721
--------------------------------------------------------------------------------
1,500 New Jersey EDA, First Mortgage Revenue Bonds
(Fellowship Village), Series C, 5.50% due 1/01/2028 1,521
--------------------------------------------------------------------------------
New Jersey EDA, First Mortgage Revenue
Refunding Bonds:
1,250 (Fellowship Village), Series A, 5.50%
due 1/01/2018 1,266
3,500 (Fellowship Village), Series A, 5.50%
due 1/01/2025 3,536
2,500 (The Winchester Gardens at Ward Homestead
Project), Series A, 5.75% due 11/01/2024 2,664
2,000 (The Winchester Gardens at Ward Homestead
Project), Series A, 5.80% due 11/01/2031 2,145
--------------------------------------------------------------------------------
14,000 New Jersey EDA, Motor Vehicle Surcharge Revenue
Bonds, Series A, 5.25% due 7/01/2033 (d) 14,883
--------------------------------------------------------------------------------
New Jersey EDA, Revenue Bonds:
220 (Department of Human Services),
5% due 7/01/2012 229
3,850 (Saint Barnabas Project), Series A,
6.30% due 7/01/2024 (d)(h) 1,800
--------------------------------------------------------------------------------
New Jersey EDA, School Facilities Construction
Revenue Bonds:
5,800 Series L, 5% due 3/01/2030 (c) 6,057
3,400 Series O, 5.25% due 3/01/2023 3,645
3,000 Series P, 5% due 9/01/2015 3,200
3,115 Series P, 5.25% due 9/01/2016 3,366
--------------------------------------------------------------------------------
1,750 New Jersey EDA, Sewer Facilities Revenue Refunding
Bonds (Anheuser Busch), AMT, 4.95% due 3/01/2047 1,748
--------------------------------------------------------------------------------
Portfolio Abbreviations
To simplify the listings of BlackRock MuniYield New Jersey Fund, Inc.'s
portfolio holdings in the Schedule of Investments, we have abbreviated the names
of many of the securities according to the list at right.
AMT Alternative Minimum Tax (subject to)
CABS Capital Appreciation Bonds
COP Certificates of Participation
EDA Economic Development Authority
EDR Economic Development Revenue Bonds
GO General Obligation Bonds
M/F Multi-Family
S/F Single-Family
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 7
Schedule of Investments (continued) (in Thousands)
Face
Amount Municipal Bonds Value
================================================================================
New Jersey (continued)
--------------------------------------------------------------------------------
$ 6,670 New Jersey EDA, Water Facilities Revenue Bonds
(New Jersey-American Water Company, Inc. Project),
AMT, Series A, 6.875% due 11/01/2034 (b) $ 6,750
--------------------------------------------------------------------------------
5,975 New Jersey Environmental Infrastructure Trust Revenue
Bonds (Environmental Infrastructure), Series A,
5.25% due 9/01/2010 (f) 6,286
--------------------------------------------------------------------------------
1,100 New Jersey Health Care Facilities Financing Authority,
Health System Revenue Bonds (Catholic Health East),
Series A, 5.375% due 11/15/2012 (f) 1,179
--------------------------------------------------------------------------------
New Jersey Health Care Facilities Financing Authority
Revenue Bonds:
1,540 (Children's Specialized Hospital), Series A,
5.50% due 7/01/2036 1,616
1,950 (Hunterdon Medical Center), Series A,
5.125% due 7/01/2035 2,009
1,845 (Pascack Valley Hospital Association),
6.625% due 7/01/2036 1,651
1,845 (RWJ Healthcare Corporation), Series B,
5% due 7/01/2035 (e) 1,909
4,000 (Robert Wood University), 5.70%
due 7/01/2020 (a) 4,199
1,875 (Somerset Medical Center), 5.50% due 7/01/2033 1,934
6,640 (South Jersey Hospital), 6% due 7/01/2012 (f) 7,239
2,000 (Southern Ocean County Hospital), 5.125%
due 7/01/2031 (e) 2,068
--------------------------------------------------------------------------------
New Jersey Health Care Facilities Financing Authority,
Revenue Refunding Bonds:
1,020 (Atlantic City Medical Center), 6.25%
due 7/01/2017 1,118
2,185 (Atlantic City Medical Center), 5.75%
due 7/01/2025 2,319
1,650 (Capital Health System Inc.), Series A, 5.75%
due 7/01/2023 1,750
5,500 (Holy Name Hospital), 6% due 7/01/2025 5,619
1,500 (Meridian Health System Obligation Group),
5.25% due 7/01/2019 (c) 1,553
2,250 (Meridian Health System Obligation Group),
5.375% due 7/01/2024 (c) 2,329
2,195 (Meridian Health System Obligation Group),
5.25% due 7/01/2029 (c) 2,269
4,255 (Saint Barnabas Health Care System), Series A,
5% due 7/01/2029 4,281
12,000 (Saint Barnabas Health Care System), Series B,
5.12% due 7/01/2037 (h) 2,367
2,720 (Saint Barnabas Health Care System), Series B,
5.13% due 7/01/2038 (h) 508
1,385 (South Jersey Hospital System), 5% due 7/01/2036 1,402
1,650 (South Jersey Hospital System), 5% due 7/01/2046 1,666
--------------------------------------------------------------------------------
4,150 New Jersey State Educational Facilities Authority,
Higher Education, Capital Improvement Revenue
Bonds, Series A, 5.125% due 9/01/2012 (a)(f) 4,397
--------------------------------------------------------------------------------
New Jersey State Educational Facilities Authority
Revenue Bonds:
2,000 (Georgian Court College Project), Series C,
6.50% due 7/01/2033 2,222
1,955 (Rowan University), Series C, 5%
due 7/01/2014 (d)(f) 2,084
2,165 (Rowan University), Series C, 5.125%
due 7/01/2014 (d)(f) 2,325
400 (Rowan University), Series G, 4.50%
due 7/01/2031 (d) 394
--------------------------------------------------------------------------------
New Jersey State Educational Facilities Authority,
Revenue Refunding Bonds:
5,305 (Montclair State University), Series L, 5%
due 7/01/2014 (d)(f) 5,656
1,870 (Princeton Theological Seminary), 5%
due 7/01/2026 1,952
2,600 (Princeton University), Series A, 5% due 7/01/2030 2,738
750 (Ramapo College), Series I, 4.25%
due 7/01/2031 (a) 720
1,000 (Ramapo College), Series I, 4.25%
due 7/01/2036 (a) 953
1,000 (Rider University), 5% due 7/01/2017 (e) 1,033
1,255 (Rider University), Series A, 5.50%
due 7/01/2023 (e) 1,351
1,450 (Rider University), Series A, 5.25%
due 7/01/2034 (e) 1,535
1,300 (Rowan University), Series B, 4.25%
due 7/01/2034 (b) 1,243
--------------------------------------------------------------------------------
3,605 New Jersey State Higher Education Assistance
Authority, Student Loan Revenue Bonds, AMT,
Series A, 5.30% due 6/01/2017 (a) 3,637
--------------------------------------------------------------------------------
2,500 New Jersey State Highway Authority, Garden State
Parkway General Revenue Refunding Bonds,
5.625% due 1/01/2010 (f) 2,634
--------------------------------------------------------------------------------
7,175 New Jersey State Housing and Mortgage Finance
Agency, Capital Fund Program Revenue Bonds,
Series A, 4.70% due 11/01/2025 (c) 7,255
--------------------------------------------------------------------------------
New Jersey State Housing and Mortgage Finance
Agency, Home Buyer Revenue Bonds, AMT (d):
4,515 Series CC, 5.80% due 10/01/2020 4,650
2,600 Series U, 5.60% due 10/01/2012 2,647
--------------------------------------------------------------------------------
1,500 New Jersey State Housing and Mortgage Finance
Agency, M/F Revenue Bonds, AMT, Series A,
4.90% due 11/01/2035 (b) 1,502
--------------------------------------------------------------------------------
1,500 New Jersey State Housing and Mortgage Finance
Agency, S/F Housing Revenue Refunding Bonds, AMT,
Series T, 4.65% due 10/01/2032 1,451
--------------------------------------------------------------------------------
3,620 New Jersey State Transit Corporation, COP (Federal
Transit Administration Grants), Series B, 5.75%
due 9/15/2014 3,901
--------------------------------------------------------------------------------
8 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
Schedule of Investments (continued) (in Thousands)
Face
Amount Municipal Bonds Value
===============================================================================
New Jersey (concluded)
-------------------------------------------------------------------------------
New Jersey State Transportation Trust Fund Authority,
Transportation System Revenue Bonds:
$ 3,525 Series A, 5.50% due 12/15/2021 $ 3,971
4,140 Series C, 5.05% due 12/15/2035 (a)(h) 1,118
6,405 Series D, 5% due 6/15/2020 6,698
-------------------------------------------------------------------------------
5,865 New Jersey State Transportation Trust Fund Authority,
Transportation System Revenue Refunding Bonds,
Series B, 5.50% due 12/15/2021 (d) 6,654
-------------------------------------------------------------------------------
4,870 New Jersey State Turnpike Authority, Turnpike Revenue
Bonds, Series B, 5.15% due 1/01/2035 (a)(h) 3,476
-------------------------------------------------------------------------------
4,250 Newark, New Jersey, Housing Authority, Port
Authority -- Port Newark Marine Terminal, Additional
Rent-Backed Revenue Refunding Bonds (City of Newark
Redevelopment Projects), 4.375% due 1/01/2037 (d) 4,109
-------------------------------------------------------------------------------
Perth Amboy, New Jersey, GO (Convertible CABS),
Refunding (c)(h):
1,575 4.739% due 7/01/2033 1,276
1,925 4.744% due 7/01/2034 1,558
-------------------------------------------------------------------------------
Port Authority of New York and New Jersey,
Consolidated Revenue Bonds:
5,000 93rd Series, 6.125% due 6/01/2094 5,912
2,000 AMT, 108th Series, 5.875% due 1/15/2017 (c) 2,030
-------------------------------------------------------------------------------
6,000 Rahway Valley Sewerage Authority, New Jersey,
Sewer Revenue Bonds (Capital Appreciation), Series A,
4.87% due 9/01/2031 (d)(h) 1,973
-------------------------------------------------------------------------------
South Jersey Port Corporation of New Jersey, Revenue
Refunding Bonds:
4,280 4.75% due 1/01/2018 4,381
2,485 4.85% due 1/01/2019 2,548
2,000 5% due 1/01/2020 2,068
-------------------------------------------------------------------------------
Tobacco Settlement Financing Corporation of
New Jersey, Asset-Backed Revenue Bonds:
3,010 7% due 6/01/2013 (f) 3,500
1,925 5.75% due 6/01/2032 2,056
-------------------------------------------------------------------------------
Tobacco Settlement Financing Corporation of
New Jersey, Revenue Refunding Bonds:
5,000 Series 1A, 5% due 6/01/2041 4,875
5,100 Series 1B, 5.65% due 6/01/2041 (h) 781
-------------------------------------------------------------------------------
Union County, New Jersey, Utilities Authority, Senior
Lease Revenue Refunding Bonds (Ogden Martin
System of Union, Inc.), AMT, Series A (a):
1,585 5.375% due 6/01/2017 1,618
1,175 5.375% due 6/01/2018 1,199
-------------------------------------------------------------------------------
University of Medicine and Dentistry of New Jersey,
Revenue Bonds, Series A (a):
945 5.50% due 12/01/2018 1,015
1,900 5.50% due 12/01/2019 2,041
1,870 5.50% due 12/01/2020 2,009
1,435 5.50% due 12/01/2021 1,542
===============================================================================
Puerto Rico -- 4.9%
-------------------------------------------------------------------------------
1,730 Puerto Rico Commonwealth Highway and Transportation
Authority, Transportation Revenue Refunding Bonds,
Series K, 5% due 7/01/2015 (f) 1,860
-------------------------------------------------------------------------------
2,750 Puerto Rico Electric Power Authority, Power Revenue
Bonds, Series TT, 5% due 7/01/2032 2,856
-------------------------------------------------------------------------------
1,900 Puerto Rico Industrial, Tourist, Educational, Medical and
Environmental Control Facilities Revenue Bonds
(Cogeneration Facility -- AES Puerto Rico Project), AMT,
6.625% due 6/01/2026 2,049
-------------------------------------------------------------------------------
3,750 Puerto Rico Municipal Finance Agency, GO, Series A,
5% due 8/01/2021 (c) 3,977
===============================================================================
U.S. Virgin Islands -- 2.7%
-------------------------------------------------------------------------------
3,500 Virgin Islands Government Refinery Facilities, Revenue
Refunding Bonds (Hovensa Coker Project), AMT,
6.50% due 7/01/2021 3,920
-------------------------------------------------------------------------------
1,900 Virgin Islands Public Finance Authority, Refinery
Facilities Revenue Bonds (Hovensa Refinery), AMT, 5.875%
due 7/01/2022 2,051
-------------------------------------------------------------------------------
Total Municipal Bonds
(Cost -- $304,273) -- 145.1% 317,666
===============================================================================
===============================================================================
Municipal Bonds Held in Trust (g)
===============================================================================
New Jersey -- 3.8%
-------------------------------------------------------------------------------
Delaware River Port Authority of Pennsylvania and
New Jersey Revenue Bonds (c):
2,500 6% due 1/01/2018 2,629
5,360 6% due 1/01/2019 5,636
===============================================================================
Puerto Rico -- 8.1%
-------------------------------------------------------------------------------
17,500 Puerto Rico Public Buildings Authority Revenue Bonds
(Government Facilities), Series B, 5.25%
due 7/01/2007 (d)(f) 17,783
-------------------------------------------------------------------------------
Total Municipal Bonds Held in Trust
(Cost -- $25,631) -- 11.9% 26,048
===============================================================================
===============================================================================
Shares
Held Short-Term Securities
===============================================================================
1,942 CMA New Jersey Municipal Money Fund, 3.18% (i)(j) 1,942
-------------------------------------------------------------------------------
Total Short-Term Securities
(Cost -- $1,942) -- 0.9% 1,942
===============================================================================
Total Investments (Cost -- $331,846*) -- 157.9% 345,656
Other Assets Less Liabilities -- 2.4% 5,083
Liability for Trust Certificates,
Including Interest Expense Payable -- (5.9%) (12,873)
Preferred Stock, at Redemption Value -- (54.4%) (119,019)
---------
Net Assets Applicable to Common Stock -- 100.0% $ 218,847
=========
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 9
Schedule of Investments (concluded) (in Thousands)
* The cost and unrealized appreciation (depreciation) of investments as of
May 31, 2007, as computed for federal income tax purposes, were as
follows:
Aggregate cost ............................................. $ 319,251
=========
Gross unrealized appreciation .............................. $ 14,747
Gross unrealized depreciation .............................. (1,022)
---------
Net unrealized appreciation ................................ $ 13,725
=========
(a) AMBAC Insured.
(b) FGIC Insured.
(c) FSA Insured.
(d) MBIA Insured.
(e) Radian Insured.
(f) Prerefunded.
(g) Securities represent underlying bonds transferred to a separate
securitization trust established in a tender option bond transaction in
which the Fund may have acquired the residual interest certificates. These
securities serve as collateral in a financing transaction. See Note 1(c)
to Financial Statements for details of municipal bonds held in trust.
(h) Represents a zero coupon or step bond; the interest rate shown reflects
the effective yield at the time of purchase.
(i) Investments in companies considered to be an affiliate of the Fund, for
purposes of Section 2(a)(3) of the Investment Company Act of 1940, were as
follows:
--------------------------------------------------------------------------
Net Dividend
Affiliate Activity Income
--------------------------------------------------------------------------
CMA New Jersey Municipal Money Fund 1,667 $71
--------------------------------------------------------------------------
(j) Represents the current yield as of May 31, 2007.
(k) Assured Guaranty Insured.
See Notes to Financial Statements.
10 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
Statement of Net Assets
As of May 31, 2007 (Unaudited)
===================================================================================================================================
Assets
-----------------------------------------------------------------------------------------------------------------------------------
Investments in unaffiliated securities, at value (identified cost -- $329,904,515) $ 343,713,813
Investments in affiliated securities, at value (identified cost -- $1,941,962) ..... 1,941,962
Cash ............................................................................... 47,361
Receivables:
Interest ....................................................................... $ 5,856,676
Securities sold ................................................................ 260,000 6,116,676
-------------
Prepaid expenses ................................................................... 10,932
-------------
Total assets ....................................................................... 351,830,744
-------------
===================================================================================================================================
Liabilities
-----------------------------------------------------------------------------------------------------------------------------------
Trust certificates ................................................................. 12,680,000
Payables:
Dividends to Common Stock shareholders ......................................... 823,788
Interest expense ............................................................... 193,429
Investment adviser ............................................................. 143,823
Other affiliates ............................................................... 3,270 1,164,310
-------------
Accrued expenses ................................................................... 119,943
-------------
Total liabilities .................................................................. 13,964,253
-------------
===================================================================================================================================
Preferred Stock
-----------------------------------------------------------------------------------------------------------------------------------
Preferred Stock, at redemption value, par value $.05 per share (2,400 Series A
Shares and 1,500 Series B Shares) and $.10 per share (860 Series C Shares) of
AMPS* authorized, issued and outstanding at $25,000 per share liquidation
preference ....................................................................... 119,019,138
-------------
===================================================================================================================================
Net Assets Applicable to Common Stock
-----------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common Stock .............................................. $ 218,847,353
=============
===================================================================================================================================
Analysis of Net Assets Applicable to Common Stock
-----------------------------------------------------------------------------------------------------------------------------------
Common Stock, par value $.10 per share (14,203,242 shares issued and outstanding) .. $ 1,420,324
Paid-in capital in excess of par ................................................... 203,960,129
Undistributed investment income -- net ............................................. $ 1,676,269
Accumulated realized capital losses -- net ......................................... (2,018,667)
Unrealized appreciation -- net ..................................................... 13,809,298
-------------
Total accumulated earnings -- net .................................................. 13,466,900
-------------
Total -- Equivalent to $15.41 net asset value per share of Common Stock
(market price -- $14.85) ......................................................... $ 218,847,353
=============
* Auction Market Preferred Stock.
See Notes to Financial Statements.
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 11
Statement of Operations
For the Six Months Ended May 31, 2007 (Unaudited)
===================================================================================================================================
Investment Income
-----------------------------------------------------------------------------------------------------------------------------------
Interest ........................................................................... $ 8,360,529
Dividends from affiliates .......................................................... 70,616
-------------
Total income ....................................................................... 8,431,145
-------------
===================================================================================================================================
Expenses
-----------------------------------------------------------------------------------------------------------------------------------
Investment advisory fees ........................................................... $ 852,143
Interest expense and fees .......................................................... 273,935
Commission fees .................................................................... 144,264
Accounting services ................................................................ 59,925
Professional fees .................................................................. 36,872
Transfer agent fees ................................................................ 30,902
Printing and shareholder reports ................................................... 25,270
Directors' fees and expenses ....................................................... 9,621
Custodian fees ..................................................................... 9,270
Pricing fees ....................................................................... 8,134
Listing fees ....................................................................... 4,481
Other .............................................................................. 24,179
-------------
Total expenses before reimbursement ................................................ 1,478,996
Reimbursement of expenses .......................................................... (10,129)
-------------
Total expenses after reimbursement ................................................. 1,468,867
-------------
Investment income -- net ........................................................... 6,962,278
-------------
===================================================================================================================================
Realized & Unrealized Gain (Loss) -- Net
-----------------------------------------------------------------------------------------------------------------------------------
Realized gain on investments -- net ................................................ 1,384,475
Change in unrealized appreciation on investments -- net ............................ (8,455,045)
-------------
Total realized and unrealized loss -- net .......................................... (7,070,570)
-------------
===================================================================================================================================
Dividends to Preferred Stock Shareholders
-----------------------------------------------------------------------------------------------------------------------------------
Investment income -- net ........................................................... (1,956,457)
-------------
Net Decrease in Net Assets Resulting from Operations ............................... $ (2,064,749)
=============
See Notes to Financial Statements.
12 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
Statements of Changes in Net Assets
For the Six
Months Ended For the
May 31, Year Ended
2007 November 30,
Increase (Decrease) in Net Assets: (Unaudited) 2006
===================================================================================================================================
Operations
-----------------------------------------------------------------------------------------------------------------------------------
Investment income -- net ........................................................... $ 6,962,278 $ 14,265,484
Realized gain -- net ............................................................... 1,384,475 1,517,835
Change in unrealized appreciation -- net ........................................... (8,455,045) 6,246,899
Dividends to Preferred Stock shareholders .......................................... (1,956,457) (3,617,009)
-------------------------------
Net increase (decrease) in net assets resulting from operations .................... (2,064,749) 18,413,209
-------------------------------
===================================================================================================================================
Dividends to Common Stock Shareholders
-----------------------------------------------------------------------------------------------------------------------------------
Investment income -- net ........................................................... (4,942,729) (10,808,667)
-------------------------------
Net decrease in net assets resulting from dividends to Common Stock shareholders ... (4,942,729) (10,808,667)
-------------------------------
===================================================================================================================================
Net Assets Applicable to Common Stock
-----------------------------------------------------------------------------------------------------------------------------------
Total increase (decrease) in net assets applicable to Common Stock ................. (7,007,478) 7,604,542
Beginning of period ................................................................ 225,854,831 218,250,289
-------------------------------
End of period* ..................................................................... $ 218,847,353 $ 225,854,831
===============================
* Undistributed investment income -- net ....................................... $ 1,676,269 $ 1,613,177
===============================
See Notes to Financial Statements.
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 13
For the Six
The following per share data and ratios have Months Ended For the Year Ended November 30,
been derived from information provided in May 31, 2007 ----------------------------------------------------------------
the financial statements. (Unaudited) 2006 2005 2004 2003 2002
===================================================================================================================================
Per Share Operating Performance
-----------------------------------------------------------------------------------------------------------------------------------
Net asset value, beginning of period .. $ 15.90 $ 15.37 $ 15.25 $ 15.39 $ 14.84 $ 14.78
------------------------------------------------------------------------------
Investment income -- net .............. .50++ 1.00++ 1.01++ 1.06++ 1.05++ 1.06
Realized and unrealized gain
(loss) -- net ....................... (.50) .54 .18 (.14) .52 .05
Dividends and distributions to
Preferred Stock shareholders:
Investment income -- net .......... (.14) (.25) (.16) (.08) (.06) (.09)
Realized gain -- net .............. -- -- -- -- -- --+
------------------------------------------------------------------------------
Total from investment operations ...... (.14) 1.29 1.03 .84 1.51 1.02
------------------------------------------------------------------------------
Less dividends and distributions to
Common Stock shareholders:
Investment income -- net .......... (.35) (.76) (.91) (.96) (.96) (.96)
Realized gain -- net .............. -- -- -- -- -- --+
------------------------------------------------------------------------------
Total dividends and distributions to
Common Stock shareholders ........... (.35) (.76) (.91) (.96) (.96) (.96)
------------------------------------------------------------------------------
Offering and underwriting costs,
including adjustments, resulting
from the issuance of Preferred Stock -- -- --+ (.02) -- --
------------------------------------------------------------------------------
Net asset value, end of period ........ $ 15.41 $ 15.90 $ 15.37 $ 15.25 $ 15.39 $ 14.84
==============================================================================
Market price per share, end of period . $ 14.85 $ 15.47 $ 14.38 $ 14.73 $ 14.34 $ 14.07
==============================================================================
===================================================================================================================================
Total Investment Return**
-----------------------------------------------------------------------------------------------------------------------------------
Based on net asset value per share .... (.83%)@@ 8.83% 7.08% 5.84% 10.81% 7.22%
==============================================================================
Based on market price per share ....... (1.78%)@@ 13.17% 3.72% 9.72% 8.90% 4.27%
==============================================================================
===================================================================================================================================
Ratios Based on Average Net Assets Applicable to Common Stock
-----------------------------------------------------------------------------------------------------------------------------------
Total expenses, net of reimbursement
and excluding interest expense
and fees*** ......................... 1.08%* 1.09% 1.09% 1.02% 1.02% 1.05%
==============================================================================
Total expenses, net of reimbursement*** 1.32%* 1.44% 1.39% 1.24% 1.21% 1.31%
==============================================================================
Total expenses*** ..................... 1.33%* 1.44% 1.39% 1.25% 1.22% 1.31%
==============================================================================
Total investment income -- net*** ..... 6.27%* 6.50% 6.47% 6.94% 6.94% 7.06%
==============================================================================
Amount of dividends to Preferred Stock
shareholders ........................ 1.76%* 1.65% 1.05% .50% .40% .58%
==============================================================================
Investment income to Common Stock
shareholders -- net ................. 4.51%* 4.85% 5.42% 6.44% 6.54% 6.48%
==============================================================================
===================================================================================================================================
Ratios Based on Average Net Assets Applicable to Preferred Stock
-----------------------------------------------------------------------------------------------------------------------------------
Dividends to Preferred Stock shareholders 3.30%* 3.04% 1.97% 1.04% .89% 1.25%
==============================================================================
===================================================================================================================================
Supplemental Data
-----------------------------------------------------------------------------------------------------------------------------------
Net assets applicable to Common Stock,
end of period (in thousands) ........ $218,847 $225,855 $218,250 $216,618 $218,642 $210,727
==============================================================================
Preferred Stock outstanding at
liquidation preference, end of period
(in thousands) ...................... $119,000 $119,000 $119,000 $119,000 $ 97,500 $ 97,500
==============================================================================
Portfolio turnover .................... 9% 9% 32% 14% 26% 37%
==============================================================================
===================================================================================================================================
Leverage
-----------------------------------------------------------------------------------------------------------------------------------
Asset coverage per $1,000 ............. $ 2,839 $ 2,898 $ 2,834 $ 2,820 $ 3,242 $ 3,161
==============================================================================
===================================================================================================================================
Dividends Per Share on Preferred Stock Outstanding
-----------------------------------------------------------------------------------------------------------------------------------
Series A -- Investment income -- net .. $ 411 $ 764 $ 497 $ 259 $ 225 $ 325
==============================================================================
Series B -- Investment income -- net .. $ 412 $ 757 $ 479 $ 250 $ 219 $ 292
==============================================================================
Series C@ -- Investment income -- net . $ 409 $ 753 $ 500 $ 91 -- --
==============================================================================
* Annualized.
** Total investment returns based on market value, which can be significantly
greater or lesser than the net asset value, may result in substantially
different returns. Total investment returns exclude the effects of sales
charges.
*** Do not reflect the effect of dividends to Preferred Stock shareholders.
+ Amount is less than $(.01) per share.
++ Based on average shares outstanding.
@ Series C was issued on August 23, 2004.
@@ Aggregate total investment return.
See Notes to Financial Statements.
14 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
Notes to Financial Statements (Unaudited)
1. Significant Accounting Policies:
BlackRock MuniYield New Jersey Fund, Inc. (the "Fund") is registered under the
Investment Company Act of 1940, as amended, as a non-diversified, closed-end
management investment company. The Fund's financial statements are prepared in
conformity with U.S. generally accepted accounting principles, which may require
the use of management accruals and estimates. Actual results may differ from
these estimates. These unaudited financial statements reflect all adjustments,
which are, in the opinion of management, necessary to present a fair statement
of the results for the interim period. All such adjustments are of a normal,
recurring nature. The Fund determines and makes available for publication the
net asset value of its Common Stock on a daily basis. The Fund's Common Stock
shares are listed on the New York Stock Exchange under the symbol MYJ. The
following is a summary of significant accounting policies followed by the Fund.
(a) Valuation of investments -- Municipal bonds are traded primarily in the
over-the-counter ("OTC") markets and are valued at the last available bid price
in the OTC market or on the basis of values as obtained by a pricing service.
Pricing services use valuation matrixes that incorporate both dealer-supplied
valuations and valuation models. The procedures of the pricing service and its
valuations are reviewed by the officers of the Fund under the general direction
of the Board of Directors. Such valuations and procedures are reviewed
periodically by the Board of Directors of the Fund. Financial futures contracts
and options thereon, which are traded on the exchanges, are valued at their
closing prices as of the close of such exchanges. Options written or purchased
are valued at the last sale price in the case of exchange-traded options.
Options traded in the OTC market are valued at the last asked price (options
written) or the last bid price (options purchased). Swap agreements are valued
by quoted fair values received daily by the Fund's pricing service. Investments
in open-end investment companies are valued at their net asset value each
business day. Securities and other assets for which market quotations are not
readily available are valued at fair value as determined in good faith by or
under the direction of the Board of Directors of the Fund.
(b) Derivative financial instruments -- The Fund may engage in various portfolio
investment strategies both to increase the return of the Fund and to hedge, or
protect, its exposure to interest rate movements and movements in the securities
markets. Losses may arise due to changes in the value of the contract due to an
unfavorable change in the price of the underlying securities or if the
counterparty does not perform under the contract.
o Financial futures contracts -- The Fund may purchase or sell financial
futures contracts and options on such financial futures contracts.
Financial futures contracts are contracts for delayed delivery of
securities at a specific future date and at a specific price or yield.
Upon entering into a contract, the Fund deposits and maintains as
collateral such initial margin as required by the exchange on which the
transaction is effected. Pursuant to the contract, the Fund agrees to
receive from or pay to the broker an amount of cash equal to the daily
fluctuation in value of the contract. Such receipts or payments are known
as variation margin and are recorded by the Fund as unrealized gains or
losses. When the contract is closed, the Fund records a realized gain or
loss equal to the difference between the value of the contract at the time
it was opened and the value at the time it was closed.
o Options -- The Fund may write covered call options and purchase put
options. When the Fund writes an option, an amount equal to the premium
received by the Fund is reflected as an asset and an equivalent liability.
The amount of the liability is subsequently marked-to-market to reflect
the current market value of the option written. When a security is
purchased or sold through an exercise of an option, the related premium
paid (or received) is added to (or deducted from) the basis of the
security acquired or deducted from (or added to) the proceeds of the
security sold. When an option expires (or the Fund enters into a closing
transaction), the Fund realizes a gain or loss on the option to the extent
of the premiums received or paid (or gain or loss to the extent the cost
of the closing transaction exceeds the premium paid or received).
Written and purchased options are non-income producing investments.
o Forward interest rate swaps -- The Fund may enter into forward interest
rate swaps. In a forward interest rate swap, the Fund and the counterparty
agree to make periodic net payments on a specified notional contract
amount, commencing on a specified future effective date, unless terminated
earlier. When the agreement is closed,
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 15
Notes to Financial Statements (continued)
the Fund records a realized gain or loss in an amount equal to the value
of the agreement.
o Swaps -- The Fund may enter into swap agreements, which are OTC contracts
in which the Fund and a counterparty agree to make periodic net payments
on a specified notional amount. The net payments can be made for a set
period of time or may be triggered by a predetermined credit event. The
net periodic payments may be based on a fixed or variable interest rate;
the change in market value of a specified security, basket of securities,
or index; or the return generated by a security. These periodic payments
received or made by the Fund are recorded in the accompanying Statement of
Operations as realized gains or losses, respectively. Gains or losses are
also realized upon termination of the swap agreements. Swaps are
marked-to-market daily and changes in value are recorded as unrealized
appreciation (depreciation). Risks include changes in the returns of the
underlying instruments, failure of the counterparties to perform under the
contracts' terms and the possible lack of liquidity with respect to the
swap agreements.
(c) Municipal bonds held in trust -- The Fund invests in leveraged residual
certificates ("TOB Residuals") issued by tender option bond trusts ("TOBs"). A
TOB is established by a third party sponsor forming a special purpose entity,
into which the Fund, or an agent on behalf of the Fund, transfers municipal
securities. A TOB typically issues two classes of beneficial interests:
short-term floating rate certificates, which are sold to third party investors,
and residual certificates, which are generally issued to the Fund which made the
transfer or to affiliates of the Fund. The transfer of the municipal securities
to a TOB does not qualify for sale treatment under Statement of Financial
Accounting Standards No. 140, "Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities" ("FAS 140"), therefore the
municipal securities deposited into a TOB are presented in the Fund's schedule
of investments and the proceeds from the transaction are reported as a liability
for trust certificates of the Fund. Similarly, proceeds from residual
certificates issued to affiliates, if any, from the transaction are included in
the liability for trust certificates. Interest income from the underlying
security is recorded by the Fund on an accrual basis. Interest expense incurred
on the secured borrowing and other expenses related to remarketing,
administration and trustee services to a TOB are reported as expenses of the
Fund. The floating rate certificates have interest rates that generally reset
weekly and their holders have the option to tender certificates to the TOB for
redemption at par at each reset date. The residual interests held by the Fund
include the right of the Fund (1) to cause the holders of a proportional share
of the floating rate certificates to tender their certificates at par, and (2)
to transfer a corresponding share of the municipal securities from the TOB to
the Fund. At May 31, 2007, the aggregate value of the underlying municipal
securities transferred to TOBs was $26,047,686, the related liability for trust
certificates was $12,680,000 and the range of interest rates was 4.79% to 4.84%.
Financial transactions executed through TOBs generally will underperform the
market for fixed rate municipal bonds in a rising interest rate environment, but
tend to outperform the market for fixed rate bonds when interest rates decline
or remain relatively stable. Should short-term interest rates rise, the Fund's
investments in TOB Residuals likely will adversely affect the Fund's investment
income -- net and distributions to shareholders. Fluctuations in the market
value of municipal securities deposited into the TOB may adversely affect the
Fund's net asset value per share.
While the Fund's investment policies and restrictions expressly permit
investments in inverse floating rate securities such as TOB Residuals, they
generally do not allow the Fund to borrow money for purposes of making
investments. The Fund's management believes that the Fund's restrictions on
borrowings do not apply to the liability for trust certificates reflected as a
result of the Fund's investments in TOB Residuals.
(d) Income taxes -- It is the Fund's policy to comply with the requirements of
the Internal Revenue Code applicable to regulated investment companies and to
distribute substantially all of its taxable income to its shareholders.
Therefore, no federal income tax provision is required.
(e) Security transactions and investment income -- Security transactions are
recorded on the dates the transactions are entered into (the trade dates).
Realized gains and losses on security transactions are determined on the
identified cost basis. Dividend income is recorded on the ex-dividend date.
Interest income is recognized on the accrual basis. The Fund amortizes all
premiums and discounts on debt securities.
(f) Dividends and distributions -- Dividends from net investment income are
declared and paid monthly. Distributions of capital gains are recorded on the
ex-dividend dates.
16 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
Notes to Financial Statements (continued)
(g) Recent accounting pronouncements -- In July 2006, the Financial Accounting
Standards Board released FASB Interpretation No. 48 ("FIN 48"), "Accounting for
Uncertainty in Income Taxes." FIN 48 provides guidance for how uncertain tax
positions should be recognized, measured, presented and disclosed in financial
statements. FIN 48 requires the evaluation of tax positions taken in the course
of preparing the Fund's tax returns to determine whether the tax positions are
"more-likely-than-not" of being sustained by the applicable tax authority. Tax
benefits of positions not deemed to meet the more-likely-than-not threshold
would be booked as a tax expense in the current year and recognized as: a
liability for unrecognized tax benefits; a reduction of an income tax refund
receivable; a reduction of deferred tax asset; an increase in deferred tax
liability; or a combination thereof. Adoption of FIN 48 is required for the last
net asset value calculation in the first required financial statement reporting
period for fiscal years beginning after December 15, 2006. The impact on the
Fund's financial statements, if any, is currently being assessed.
In September 2006, Statement of Financial Accounting Standards No. 157, "Fair
Value Measurements" ("FAS 157"), was issued and is effective for fiscal years
beginning after November 15, 2007. FAS 157 defines fair value, establishes a
framework for measuring fair value and expands disclosures about fair value
measurements. At this time, management is evaluating the implications of FAS 157
and its impact on the Fund's financial statements, if any, has not been
determined.
In addition, in February 2007, FASB issued Statement of Financial Accounting
Standards No. 159, "The Fair Value Option for Financial Assets and Financial
Liabilities" ("FAS 159"), which is effective for fiscal years beginning after
November 15, 2007. Early adoption is permitted as of the beginning of a fiscal
year that begins on or before November 15, 2007, provided the entity also elects
to apply the provisions of FAS 157. FAS 159 permits entities to choose to
measure many financial instruments and certain other items at fair value that
are not currently required to be measured at fair value. FAS 159 also
establishes presentation and disclosure requirements designed to facilitate
comparisons between entities that choose different measurement attributes for
similar types of assets and liabilities. At this time, management is evaluating
the implications of FAS 159 and its impact on the Fund's financial statements,
if any, has not been determined.
2. Investment Advisory Agreement and Transactions with Affiliates:
The Fund has entered into an Investment Advisory Agreement with BlackRock
Advisors, LLC (the "Manager"), an indirect, wholly owned subsidiary of
BlackRock, Inc. Merrill Lynch & Co., Inc. and The PNC Financial Services Group,
Inc. are the principal owners of BlackRock, Inc.
The Manager is responsible for the management of the Fund's portfolio and
provides the necessary personnel, facilities, equipment and certain other
services necessary to the operations of the Fund. For such services, the Fund
pays a monthly fee at an annual rate of .50% of the Fund's average daily net
assets, including proceeds from the issuance of Preferred Stock. The Manager has
agreed to reimburse its management fee by the amount of management fees the Fund
pays to the Manager indirectly through its investment in CMA New Jersey
Municipal Money Fund. For the six months ended May 31, 2007, the Manager
reimbursed the Fund in the amount of $10,129.
In addition, the Manager has entered into a Sub-Advisory Agreement with
BlackRock Investment Management, LLC ("BIM"), an affiliate of the Manager, under
which the Manager pays BIM for services it provides a monthly fee that is a
percentage of the management fee paid by the Fund to the Manager.
For the six months ended May 31, 2007, the Fund reimbursed the Manager $3,133
for certain accounting services.
Certain officers and/or directors of the Fund are officers and/or directors of
BlackRock, Inc. or its affiliates.
3. Investments:
Purchases and sales of investments, excluding short-term securities, for the six
months ended May 31, 2007 were $31,454,280 and $41,378,101, respectively.
4. Stock Transactions:
The Fund is authorized to issue 200,000,000 shares of stock, including Preferred
Stock, par value $.10 per share, all of which were initially classified as
Common Stock. The Board of Directors is authorized, however, to reclassify any
unissued shares of stock without approval of holders of Common Stock.
Preferred Stock
Auction Market Preferred Stock are redeemable shares of Preferred Stock of the
Fund, with a liquidation preference of $25,000 per share plus accrued and unpaid
dividends that entitle their holders to receive cash dividends at an annual
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 17
Notes to Financial Statements (concluded)
rate that may vary for the successive dividend periods. The yields in effect at
May 31, 2007 were as follows: Series A, 3.50%, Series B, 3.40% and Series C,
3.62%.
The Fund pays commissions to certain broker-dealers at the end of each auction
at an annual rate ranging from .25% to .375%, calculated on the proceeds of each
auction. For the six months ended May 31, 2007, Merrill Lynch, Pierce, Fenner &
Smith Incorporated, an affiliate of BlackRock, Inc., earned $85,580 as
commissions.
5. Capital Loss Carryforward:
On November 30, 2006, the Fund had a net capital loss carryforward of
$2,038,849, of which $1,799,293 expires in 2008 and $239,556 expires in 2012.
This amount will be available to offset like amounts of any future taxable
gains.
6. Subsequent Event:
The Fund paid a tax-exempt income dividend to holders of Common Stock in the
amount of $.058000 per share on July 2, 2007 to shareholders of record on June
15, 2007.
Officers and Directors
Robert C. Doll, Jr., Fund President and Director
James H. Bodurtha, Director
Kenneth A. Froot, Director
Joe Grills, Director
Herbert I. London, Director
Roberta Cooper Ramo, Director
Robert S. Salomon, Jr., Director
Donald C. Burke, Vice President and Treasurer
Karen Clark, Fund Chief Compliance Officer
Alice A. Pellegrino, Secretary
Custodian
The Bank of New York
100 Church Street
New York, NY 10286
Transfer Agents
Common Stock:
The Bank of New York
101 Barclay Street -- 11 East
New York, NY 10286
Preferred Stock:
The Bank of New York
101 Barclay Street -- 7 West
New York, NY 10286
NYSE Symbol
MYJ
18 BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007
BlackRock Privacy Principles
BlackRock is committed to maintaining the privacy of its current and former fund
investors and individual clients (collectively, "Clients") and to safeguarding
their non-public personal information. The following information is provided to
help you understand what personal information BlackRock collects, how we protect
that information and why in certain cases we share such information with select
parties.
If you are located in a jurisdiction where specific laws, rules or regulations
require BlackRock to provide you with additional or different privacy-related
rights beyond what is set forth below, then BlackRock will comply with those
specific laws, rules or regulations.
BlackRock obtains or verifies personal non-public information from and about you
from different sources, including the following: (i) information we receive from
you or, if applicable, your financial intermediary, on applications, forms or
other documents; (ii) information about your transactions with us, our
affiliates, or others; (iii) information we receive from a consumer reporting
agency; and (iv) from visits to our Web sites.
BlackRock does not sell or disclose to non-affiliated third parties any
non-public personal information about its Clients, except as permitted by law or
as is necessary to respond to regulatory requests or to service Client accounts.
These non-affiliated third parties are required to protect the confidentiality
and security of this information and to use it only for its intended purpose.
We may share information with our affiliates to service your account or to
provide you with information about other BlackRock products or services that may
be of interest to you. In addition, BlackRock restricts access to non-public
personal information about its Clients to those BlackRock employees with a
legitimate business need for the information. BlackRock maintains physical,
electronic and procedural safeguards that are designed to protect the non-public
personal information of its Clients, including procedures relating to the proper
storage and disposal of such information.
Availability of Quarterly Schedule of Investments
The Fund files its complete schedule of portfolio holdings with the Securities
and Exchange Commission ("SEC") for the first and third quarters of each fiscal
year on Form N-Q. The Fund's Forms N-Q are available on the SEC's Web site at
http://www.sec.gov. The Fund's Forms N-Q may also be reviewed and copied at the
SEC's Public Reference Room in Washington, DC. Information on the operation of
the Public Reference Room may be obtained by calling 1-800-SEC-0330.
Electronic Delivery
Electronic copies of most financial reports and prospectuses are available on
the Fund's Web site. Shareholders can sign up for e-mail notifications of
quarterly statements, annual and semi-annual reports and prospectuses by
enrolling in the Fund's electronic delivery program.
Shareholders Who Hold Accounts with Investment Advisers, Banks or Brokerages:
Please contact your financial advisor to enroll. Please note that not all
investment advisers, banks or brokerages may offer this service.
BLACKROCK MUNIYIELD NEW JERSEY FUND, INC. MAY 31, 2007 19
BlackRock MuniYield New Jersey Fund, Inc. seeks to provide shareholders with as
high a level of current income exempt from federal and New Jersey income taxes
as is consistent with its investment policies and prudent investment management
by investing primarily in a portfolio of long-term, investment grade municipal
obligations the interest on which, in the opinion of bond counsel to the issuer,
is exempt from federal income tax and New Jersey personal income taxes.
This report, including the financial information herein, is transmitted to
shareholders of BlackRock MuniYield New Jersey Fund, Inc. for their information.
It is not a prospectus. Past performance results shown in this report should not
be considered a representation of future performance. The Fund has leveraged its
Common Stock and intends to remain leveraged by issuing Preferred Stock to
provide the Common Stock shareholders with a potentially higher rate of return.
Leverage creates risks for Common Stock shareholders, including the likelihood
of greater volatility of net asset value and market price of shares of the
Common Stock, and the risk that fluctuations in the short-term dividend rates of
the Preferred Stock may affect the yield to Common Stock shareholders.
Statements and other information herein are as dated and are subject to change.
A description of the policies and procedures that the Fund uses to determine how
to vote proxies relating to portfolio securities is available (1) without
charge, upon request, by calling toll-free 1-800-441-7762; (2) at
www.blackrock.com; and (3) on the Securities and Exchange Commission's Web site
at http://www.sec.gov. Information about how the Fund voted proxies relating to
securities held in the Fund's portfolio during the most recent 12-month period
ended June 30 is available (1) at www.blackrock.com and (2) on the Securities
and Exchange Commission's Web site at http://www.sec.gov.
BlackRock MuniYield New Jersey Fund, Inc.
P.O. Box 9011
Princeton, NJ 08543-9011
BLACKROCK
#16381-5/07
Item 2 - Code of Ethics - Not Applicable to this semi-annual report
Item 3 - Audit Committee Financial Expert - Not Applicable to this semi-annual
report
Item 4 - Principal Accountant Fees and Services - Not Applicable to this
semi-annual report
Item 5 - Audit Committee of Listed Registrants - Not Applicable to this
semi-annual report
Item 6 - Schedule of Investments - The registrant's Schedule of Investments is
included as part of the Report to Stockholders filed under Item 1 of
this form.
Item 7 - Disclosure of Proxy Voting Policies and Procedures for Closed-End
Management Investment Companies - Not Applicable to this semi-annual
report
Item 8 - Portfolio Managers of Closed-End Management Investment Companies - Not
Applicable to this semi-annual report
Item 9 - Purchases of Equity Securities by Closed-End Management Investment
Company and Affiliated Purchasers - Not Applicable
Item 10 - Submission of Matters to a Vote of Security Holders - The registrant's
Nominating Committee will consider nominees to the Board recommended
by shareholders when a vacancy becomes available. Shareholders who
wish to recommend a nominee should send nominations which include
biographical information and set forth the qualifications of the
proposed nominee to the registrant's Secretary. There have been no
material changes to these procedures.
Item 11 - Controls and Procedures
11(a) - The registrant's principal executive and principal financial officers
or persons performing similar functions have concluded that the
registrant's disclosure controls and procedures (as defined in Rule
30a-3(c) under the Investment Company Act of 1940, as amended (the
"1940 Act")) are effective as of a date within 90 days of the filing
of this report based on the evaluation of these controls and
procedures required by Rule 30a-3(b) under the 1940 Act and Rule
13a-15(b) under the Securities and Exchange Act of 1934, as amended.
11(b) - There were no changes in the registrant's internal control over
financial reporting (as defined in Rule 30a-3(d) under the 1940 Act
(17 CFR 270.30a-3(d)) that occurred during the second fiscal quarter
of the period covered by this report that have materially affected, or
are reasonably likely to materially affect, the registrant's internal
control over financial reporting.
Item 12 - Exhibits attached hereto
12(a)(1) - Code of Ethics - Not Applicable to this semi-annual report
12(a)(2) - Certifications - Attached hereto
12(a)(3) - Not Applicable
12(b) - Certifications - Attached hereto
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
BlackRock MuniYield New Jersey Fund, Inc.
By: /s/ Robert C. Doll, Jr.
-----------------------------------------
Robert C. Doll, Jr.,
Chief Executive Officer of
BlackRock MuniYield New Jersey Fund, Inc.
Date: July 24, 2007
Pursuant to the requirements of the Securities Exchange Act of 1934 and the
Investment Company Act of 1940, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated.
By: /s/ Robert C. Doll, Jr.
-----------------------------------------
Robert C. Doll, Jr.,
Chief Executive Officer of
BlackRock MuniYield New Jersey Fund, Inc.
Date: July 24, 2007
By: /s/ Donald C. Burke
-----------------------------------------
Donald C. Burke,
Chief Financial Officer of
BlackRock MuniYield New Jersey Fund, Inc.
Date: July 24, 2007