- Quarterly Schedule of Portfolio Holdings of Registered Management Investment Company (N-Q)

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM N-Q

QUARTERLY SCHEDULE OF PORTFOLIO HOLDINGS OF REGISTERED MANAGEMENT INVESTMENT COMPANY

 

Investment Company Act file number 811-21153

 

Nuveen Maryland Dividend Advantage Municipal Fund 3

(Exact name of registrant as specified in charter)

 

Nuveen Investments

        333 West Wacker Drive, Chicago, Illinois 60606         

(Address of principal executive offices) (Zip code)

 

Kevin J. McCarthy

Vice President and Secretary

        333 West Wacker Drive, Chicago, Illinois 60606         

(Name and address of agent for service)

 

Registrant's telephone number, including area code:         312-917-7700        

 

Date of fiscal year end:             5/31          

 

Date of reporting period:          2/29/12         

 

Form N-Q is to be used by management investment companies, other than small business investment companies registered on Form N-5 (§§ 239.24 and 274.5 of this chapter), to file reports with the Commission, not later than 60 days after the close of the first and third fiscal quarters, pursuant to rule 30b1-5 under the Investment Company Act of 1940 (17 CFR 270.30b1-5). The Commission may use the information provided on Form N-Q in its regulatory, disclosure review, inspection, and policymaking roles.

 

A registrant is required to disclose the information specified by Form N-Q, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-Q unless the Form displays a currently valid Office of Management and Budget ("OMB") control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to the Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507.

 

 

 

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Item 1. Schedule of Investments

 

		Portfolio of Investments (Unaudited)
		Nuveen Maryland Dividend Advantage Municipal Fund 3 (NWI)
		February 29, 2012
Principal			Optional Call
Amount (000)		Description (1)	Provisions (2)	Ratings (3)	Value
		Consumer Discretionary – 3.8% (2.6% of Total Investments)
$    2,450		Baltimore, Maryland, Senior Lien Convention Center Hotel Revenue Bonds, Series 2006A, 5.250%,	9/16 at 100.00	BB+	$    2,304,250
		9/01/39 – SYNCORA GTY Insured
380		Baltimore, Maryland, Subordinate Lien Convention Center Hotel Revenue Bonds, Series 2006B,	9/16 at 100.00	Ba2	374,897
		5.875%, 9/01/39
700		Maryland Economic Development Corporation, Revenue Bonds, Chesapeake Bay Hyatt Conference	12/16 at 100.00	N/R	455,637
		Center, Series 2006A, 5.000%, 12/01/31
3,530		Total Consumer Discretionary			3,134,784
		Consumer Staples – 5.8% (3.8% of Total Investments)
575		Guam Economic Development & Commerce Authority, Tobacco Settlement Asset-Backed Bonds,	6/17 at 100.00	N/R	522,894
		Series 2007A, 5.250%, 6/01/32
20,000		Puerto Rico, The Children’s Trust Fund, Tobacco Settlement Asset-Backed Bonds, Series 2005A,	5/15 at 11.19	BBB–	1,370,400
		0.000%, 5/15/50
		Puerto Rico, The Children’s Trust Fund, Tobacco Settlement Asset-Backed Refunding Bonds,
		Series 2002:
2,265		5.375%, 5/15/33	5/12 at 100.00	BBB	2,240,787
560		5.500%, 5/15/39	5/12 at 100.00	Baa3	552,944
23,400		Total Consumer Staples			4,687,025
		Education and Civic Organizations – 12.9% (8.6% of Total Investments)
225		Anne Arundel County, Maryland, Economic Development Revenue Bonds, Community College Project,	9/12 at 102.00	A2	233,474
		Series 2002, 5.125%, 9/01/22
625		Frederick County, Maryland, Educational Facilities Revenue Bonds, Mount Saint Mary’s College,	9/16 at 100.00	BB+	616,944
		Series 2006, 5.625%, 9/01/38
690		Hartford County, Maryland, Economic Development Revenue Bonds, Battelle Memorial Institute,	4/14 at 100.00	A+	707,167
		Series 2004, 5.250%, 4/01/34
165		Maryland Health and Higher Edcuational Facilities Authority, Revenue Bonds, Patterson Park	7/20 at 100.00	BBB–	167,033
		Public Charter School Issue, Series 2010, 6.000%, 7/01/40
625		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Goucher College,	7/14 at 100.00	A–	641,431
		Series 2004, 5.125%, 7/01/34
1,000		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Johns Hopkins	7/12 at 100.00	AA	1,012,270
		University, Series 2002A, 5.000%, 7/01/32
735		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Johns Hopkins	No Opt. Call	AA+	915,825
		University, Series 2004, Trust 1003, 13.763%, 1/01/13 (IF)
925		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Maryland Institute	6/16 at 100.00	Baa1	948,430
		College of Art, Series 2006, 5.000%, 6/01/30
625		Maryland Industrial Development Financing Authority, Revenue Bonds, Our Lady of Good Counsel	5/15 at 100.00	N/R	636,656
		High School, Series 2005A, 6.000%, 5/01/35
710		Montgomery County Revenue Authority, Maryland, Lease Revenue Bonds, Montgomery College Arts	5/15 at 100.00	Aa3	783,939
		Center Project, Series 2005A, 5.000%, 5/01/18
1,000		Morgan State University, Maryland, Student Tuition and Fee Revenue Bonds, Academic Fees and	7/13 at 100.00	Aa3	1,020,000
		Auxiliary Facilities, Series 2003A, 5.000%, 7/01/32 – FGIC Insured
800		University of Maryland, Auxiliary Facility and Tuition Revenue Bonds, Series 2006A,	10/16 at 100.00	AA+	925,672
		5.000%, 10/01/22
		Westminster, Maryland, Educational Facilities Revenue Bonds, McDaniel College, Series 2006:
890		5.000%, 11/01/31	11/16 at 100.00	BBB+	914,359
1,000		4.500%, 11/01/36	11/16 at 100.00	BBB+	951,970
10,015		Total Education and Civic Organizations			10,475,170
		Health Care – 30.4% (20.4% of Total Investments)
700		Maryland Health and Higher Education Facilities Authority, Revenue Bonds, University of	7/16 at 100.00	A	728,868
		Maryland Medical System Issue, Series 2006A, 5.000%, 7/01/31
445		Maryland Health and Higher Education Facilities Authority, Revenue Bonds, University of	7/19 at 100.00	A	474,940
		Maryland Medical System Issue, Series 2010, 5.125%, 7/01/39
300		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds Doctors Community	No Opt. Call	Baa3	309,387
		Hospital, Refunding Series 2010, 5.750%, 7/01/38
375		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Adventist	1/22 at 100.00	Baa2	416,996
		Healthcare, Series 2011A, 6.125%, 1/01/36
335		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Anne Arundel	7/19 at 100.00	A–	350,142
		Health System, Series 2010, 5.000%, 7/01/40
1,000		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Anne Arundel	7/12 at 100.00	AA–	1,000,950
		Medical Center, Series 1998, 5.125%, 7/01/33 – AGM Insured
775		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Calvert Memorial	7/14 at 100.00	A3	795,522
		Hospital, Series 2004, 5.500%, 7/01/36
1,250		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Carroll County	7/12 at 100.00	A3	1,257,688
		General Hospital, Series 2002, 5.800%, 7/01/32
1,750		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Carroll Hospital	7/16 at 100.00	A3	1,781,623
		Center, Series 2006, 5.000%, 7/01/40
1,070		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Civista Medical	7/14 at 100.00	N/R	936,485
		Center, Series 2005, 5.000%, 7/01/37 – RAAI Insured
885		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Doctors Community	7/17 at 100.00	Baa3	888,230
		Hospital, Series 2007A, 5.000%, 7/01/29
700		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Frederick Memorial	7/12 at 100.00	Baa1	700,441
		Hospital, Series 2002, 5.125%, 7/01/35
640		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Greater Baltimore	7/12 at 100.00	A	640,320
		Medical Center, Series 2001, 5.000%, 7/01/34
1,000		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Kennedy Krieger	7/13 at 100.00	Baa3	1,009,610
		Institute, Series 2003, 5.500%, 7/01/33
595		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, LifeBridge Health	7/17 at 100.00	AA–	637,644
		System, Series 2008, 5.000%, 7/01/28 – AGC Insured
400		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, LifeBridge Health	7/21 at 100.00	A	457,284
		System, Series 2011, 6.000%, 7/01/41
900		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, MedStar Health,	8/14 at 100.00	A2	955,395
		Series 2004, 5.375%, 8/15/24
1,690		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, MedStar Health,	5/16 at 100.00	AA+	1,774,635
		Series 2007, 5.250%, 5/15/46 – BHAC Insured
650		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Mercy Medical	7/12 at 100.00	BBB	650,494
		Center Issue, Series 2001, 5.625%, 7/01/31
		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Mercy Medical
		Center Issue, Series 2007A:
525		5.000%, 7/01/37	7/17 at 100.00	BBB	512,799
1,185		5.500%, 7/01/42	7/17 at 100.00	BBB	1,203,225
850		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Peninsula Regional	7/16 at 100.00	A	872,763
		Medical Center, Series 2006, 5.000%, 7/01/36
1,000		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, The Johns Hopkins	5/20 at 100.00	AA–	1,079,150
		Health System Obligated Group Issue, Series 2010, 5.000%, 5/15/40
1,845		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Union Hospital of	7/12 at 100.00	A3	1,857,712
		Cecil County, Series 2002, 5.625%, 7/01/32
		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Washington County
		Hospital, Series 2008:
1,220		5.750%, 1/01/38	1/18 at 100.00	BBB–	1,276,742
500		6.000%, 1/01/43	1/18 at 100.00	BBB–	530,070
95		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Western Maryland	7/16 at 100.00	BBB	99,149
		Health, Series 2006A, 5.000%, 7/01/34 – NPFG Insured
775		Maryland Health and Higher Educational Facilities Authority, Revenue Refunding Bonds,	1/13 at 101.00	Baa2	791,655
		Adventist Healthcare, Series 2003A, 5.750%, 1/01/25
900		Prince George’s County, Maryland, Revenue Bonds, Dimensions Health Corporation, Series 1994,	7/12 at 100.00	B3	825,831
		5.300%, 7/01/24
24,355		Total Health Care			24,815,750
		Housing/Multifamily – 7.4% (5.0% of Total Investments)
980		Maryland Community Development Administration, Housing Revenue Bonds, Series 2002B, 4.950%,	7/12 at 100.00	Aa2	981,568
		7/01/32 (Alternative Minimum Tax)
1,250		Maryland Economic Development Corporation, Senior Lien Student Housing Revenue Bonds,	10/13 at 100.00	B3	919,600
		University of Maryland – Baltimore, Series 2003A, 5.625%, 10/01/23
		Maryland Economic Development Corporation, Student Housing Revenue Bonds, Sheppard Pratt
		University Village, Series 2001:
20		5.875%, 7/01/21 – ACA Insured	7/12 at 100.50	N/R	19,751
150		6.000%, 7/01/33 – ACA Insured	7/12 at 100.50	N/R	140,247
475		Maryland Economic Development Corporation, Student Housing Revenue Refunding Bonds,	6/16 at 100.00	AA–	486,381
		University of Maryland College Park Projects, Series 2006, 5.000%, 6/01/33 – CIFG Insured
		Montgomery County Housing Opportunities Commission, Maryland, Multifamily Housing
		Development Bonds, Series 2002B:
515		5.100%, 7/01/33 (Alternative Minimum Tax)	7/12 at 100.00	Aaa	516,009
3,000		5.200%, 7/01/44 (Alternative Minimum Tax)	7/12 at 100.00	Aaa	3,004,350
6,390		Total Housing/Multifamily			6,067,906
		Housing/Single Family – 8.5% (5.7% of Total Investments)
1,470		Maryland Community Development Administration Department of Housing and Community	9/18 at 100.00	Aa2	1,554,569
		Development, Residential Revenue Bonds, Series 2008C, 5.375%, 9/01/39
505		Maryland Community Development Administration Department of Housing and Community	3/20 at 100.00	Aa2	542,865
		Development, Residential Revenue Bonds, Series 2010B, 5.250%, 9/01/35
1,160		Maryland Community Development Administration, Department of Housing and Community	9/14 at 100.00	Aa2	1,170,116
		Development, Residential Revenue Bonds, Series 2005,4.900%, 9/01/36 (Alternative
		Minimum Tax) (UB)
		Maryland Community Development Administration, Department of Housing and Community
		Development, Residential Revenue Bonds, Series 2006:
1,200		4.875%, 9/01/26 (Alternative Minimum Tax) (UB)	3/16 at 100.00	Aa2	1,230,240
595		4.900%, 9/01/26 (Alternative Minimum Tax) (UB)	9/15 at 100.00	Aa2	608,405
815		4.900%, 9/01/31 (Alternative Minimum Tax) (UB)	9/16 at 100.00	Aa2	833,998
		Maryland Community Development Administration, Department of Housing and Community
		Development, Residential Revenue Bonds, Series 2007:
350		5.000%, 9/01/27 (Alternative Minimum Tax) (UB)	3/17 at 100.00	Aa2	361,644
620		4.850%, 9/01/37 (Alternative Minimum Tax) (UB)	3/17 at 100.00	Aa2	627,552
6,715		Total Housing/Single Family			6,929,389
		Industrials – 2.7% (1.8% of Total Investments)
1,590		Maryland Economic Development Corporation, Economic Development Revenue Bonds,	6/20 at 100.00	Baa3	1,681,838
		Transportation Facilities Project, Series 2010A, 5.750%, 6/01/35
510		Maryland Economic Development Corporation, Solid Waste Disposal Revenue Bonds, Waste	4/12 at 101.00	BBB	516,849
		Management Inc., Series 2002, 4.600%, 4/01/16 (Alternative Minimum Tax)
2,100		Total Industrials			2,198,687
		Long-Term Care – 5.9% (4.0% of Total Investments)
1,050		Baltimore County, Maryland, Revenue Bonds, Oak Crest Village, Series 2007A, 5.000%, 1/01/37	1/17 at 100.00	BBB+	1,059,135
380		Gaithersburg, Maryland, Economic Development Revenue Bonds, Asbury Methodist Homes Inc.,	1/20 at 100.00	N/R	420,713
		Series 2009B, 6.000%, 1/01/23
1,500		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Charlestown	1/21 at 100.00	N/R	1,679,715
		Community Issue, Series 2010, 6.250%, 1/01/45
400		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Edenwald, Series	7/16 at 100.00	N/R	399,032
		2006A, 5.400%, 1/01/31
		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, King Farm
		Presbyterian Community, Series 2007A:
280		5.000%, 1/01/17	No Opt. Call	N/R	273,986
520		5.250%, 1/01/27	1/17 at 100.00	N/R	463,434
540		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Mercy Ridge	7/17 at 100.00	A–	543,893
		Retirement Community, Series 2007, 4.750%, 7/01/34
4,670		Total Long-Term Care			4,839,908
		Tax Obligation/General – 8.8% (5.9% of Total Investments)
380		Carroll County, Maryland, Consolidated Public Improvement Bonds, Series 2005A, 5.000%, 12/01/16	12/15 at 100.00	AA+	444,159
710		Frederick, Maryland, General Obligation Bonds, Series 2005, 5.000%, 8/01/16 – NPFG Insured	8/15 at 100.00	AA	818,666
1,000		Maryland National Capital Park Planning Commission, Prince George’s County, General Obligation	1/14 at 100.00	AAA	1,081,110
		Bonds, Park Acquisition and Development, Series 2004EE-2, 5.000%, 1/15/17
1,850		Montgomery County, Maryland, Consolidated General Obligation Public Improvement Bonds, Series	No Opt. Call	AAA	2,128,962
		2005A, 5.000%, 7/01/15
1,440		Montgomery County, Maryland, Consolidated General Obligation Public Improvement Bonds, Series	No Opt. Call	AAA	1,705,781
		2006A, 5.000%, 5/01/16
1,000		St. Mary’s County, Maryland, General Obligation Hospital Bonds, Series 2002, 5.000%, 10/01/12	No Opt. Call	AA	1,029,110
6,380		Total Tax Obligation/General			7,207,788
		Tax Obligation/Limited – 33.0% (22.1% of Total Investments)
185		Anne Arundel County, Maryland, Special Obligation Bonds, National Business Park – North	7/18 at 102.00	N/R	191,640
		Project, Series 2010, 6.100%, 7/01/40
130		Frederick County, Maryland, Lake Linganore Village Community Development Special Obligation	7/12 at 100.00	N/R	130,601
		Bonds, Series 2001A, 5.600%, 7/01/20 – RAAI Insured
		Fredrick County, Maryland, Special Obligation Bonds, Urbana Community Development Authority,
		Series 2010A:
1,150		5.000%, 7/01/30	7/20 at 100.00	A–	1,245,646
305		5.000%, 7/01/40	7/20 at 100.00	A–	319,268
450		Hyattsville, Maryland, Special Obligation Bonds, University Town Center Project, Series 2004,	7/14 at 102.00	N/R	450,815
		5.750%, 7/01/34
5,000		Maryland Department of Transportation, Consolidated Transportation Revenue Bonds, Series 2002,	No Opt. Call	AAA	5,967,200
		5.500%, 2/01/16
450		Maryland Economic Development Corporation, Lease Revenue Bonds, Montgomery County Town	9/12 at 100.00	AA+	461,705
		Square Parking Garage, Series 2002A, 5.000%, 9/15/13
2,935		Maryland Economic Development Corporation, Lease Revenue Bonds, Montgomery County Wayne	9/12 at 100.00	AA+	3,010,136
		Avenue Parking Project, Series 2002A, 5.250%, 9/15/16
		Maryland Stadium Authority, Lease Revenue Bonds, Montgomery County Conference Center
		Facilities, Series 2003:
1,465		5.000%, 6/15/21	6/13 at 100.00	AA+	1,543,260
1,620		5.000%, 6/15/23	6/13 at 100.00	AA+	1,703,090
1,410		Prince George’s County, Maryland, Special Obligation Bonds, National Harbor Project, Series	7/15 at 100.00	N/R	1,378,924
		2005, 5.200%, 7/01/34
542		Prince George’s County, Maryland, Special Tax District Bonds, Victoria Falls Project, Series	7/13 at 100.00	N/R	522,195
		2005, 5.250%, 7/01/35
1,200		Puerto Rico Highway and Transportation Authority, Highway Revenue Bonds, Series 2007N, 5.250%,	No Opt. Call	Baa1	1,306,392
		7/01/31 – AMBAC Insured
1,605		Puerto Rico Infrastructure Financing Authority, Special Tax Revenue Bonds, Series 2005C,	No Opt. Call	BBB+	1,804,855
		5.500%, 7/01/26 – AMBAC Insured
		Puerto Rico Public Buildings Authority, Guaranteed Government Facilities Revenue Bonds,
		Series 2002G:
1,000		5.250%, 7/01/17	7/12 at 100.00	Baa1	1,008,330
1,205		5.250%, 7/01/20	7/12 at 100.00	Baa1	1,211,230
1,275		5.250%, 7/01/21	7/12 at 100.00	Baa1	1,280,980
1,500		Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, First Subordinate Series	8/19 at 100.00	A+	1,678,830
		2009A, 5.750%, 8/01/37
		Puerto Rico Sales Tax Financing Corporation, Sales Tax Revenue Bonds, Series 2007A:
7,000		0.000%, 8/01/40 – NPFG Insured	No Opt. Call	Aa2	1,495,830
210		0.000%, 8/01/47 – AMBAC Insured	No Opt. Call	Aa2	29,373
125		Puerto Rico, Highway Revenue Bonds, Highway and Transportation Authority, Series 2003AA,	No Opt. Call	A3	143,975
		5.500%, 7/01/19 – NPFG Insured
30,762		Total Tax Obligation/Limited			26,884,275
		Transportation – 3.0% (2.0% of Total Investments)
2,210		Maryland Transportation Authority, Revenue Bonds, Transportation Facilities Projects, Series	7/17 at 100.00	AA–	2,460,481
		2007, 5.000%, 7/01/30 – AGM Insured (UB)
		U.S. Guaranteed – 20.3% (13.6% of Total Investments) (4)
1,000		Annapolis, Maryland, General Obligation Public Improvement Refunding Bonds, Series 2002,	4/12 at 101.00	AA (4)	1,013,780
		4.375%, 4/01/17 (Pre-refunded 4/01/12)
1,000		Baltimore Board of School Commissioners, Maryland, Revenue Bonds, City Public School System,	5/13 at 100.00	AA+ (4)	1,056,110
		Series 2003A, 5.000%, 5/01/15 (Pre-refunded 5/01/13)
255		Baltimore, Maryland, Wastewater Project Revenue Bonds, Series 2006C, 5.000%, 7/01/31	7/16 at 100.00	AA (4)	302,920
		(Pre-refunded 7/01/16) – AMBAC Insured
2,200		Maryland Economic Development Corporation, Lease Revenue Bonds, Department of Transportation	6/12 at 100.50	Aaa	2,236,630
		Headquarters Building, Series 2002, 4.750%, 6/01/22 (Pre-refunded 6/01/12)
285		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, Helix Health,	No Opt. Call	N/R (4)	320,485
		Series 1997, 5.000%, 7/01/17 – AMBAC Insured (ETM)
725		Maryland Health and Higher Educational Facilities Authority, Revenue Bonds, LifeBridge Health	7/14 at 100.00	A2 (4)	804,032
		System, Series 2004A, 5.125%, 7/01/34 (Pre-refunded 7/01/14)
585		Maryland Transportation Authority, Revenue Refunding Bonds, Transportation Facilities	No Opt. Call	AAA	667,029
		Projects, First Series 1978, 6.800%, 7/01/16 – AMBAC Insured (ETM)
4,860		Prince George’s County Housing Authority, Maryland, GNMA Collateralized Mortgage Revenue	11/12 at 100.00	N/R (4)	5,011,778
		Bonds, Fairview and Hillside Projects, Series 2002A, 4.700%, 11/20/22 (Pre-refunded 11/20/12)
1,000		Puerto Rico Public Finance Corporation, Commonwealth Appropriation Bonds, Series 1998A,	No Opt. Call	Aaa	1,207,730
		5.125%, 6/01/24 – AMBAC Insured
575		Puerto Rico, Highway Revenue Bonds, Highway and Transportation Authority, Series 2003AA,	No Opt. Call	A3 (4)	741,187
		5.500%, 7/01/19 – NPFG Insured
2,000		University of Maryland, Auxiliary Facility and Tuition Revenue Bonds, Series 2002A, 5.125%,	4/12 at 100.00	AA+ (4)	2,008,920
		4/01/22 (Pre-refunded 4/01/12)
1,000		Washington Suburban Sanitary District, Montgomery and Prince George’s Counties, Maryland,	6/15 at 100.00	AAA	1,145,368
		Sewerage Disposal Bonds, Series 2005, 5.000%, 6/01/16 (Pre-refunded 6/01/15)
15,485		Total U.S. Guaranteed			16,515,969
		Utilities – 1.5% (1.0% of Total Investments)
1,250		Maryland Energy Financing Administration, Revenue Bonds, AES Warrior Run Project, Series 1995,	5/12 at 100.00	N/R	1,257,625
		7.400%, 9/01/19 (Alternative Minimum Tax)
		Water and Sewer – 5.2% (3.5% of Total Investments)
2,590		Baltimore, Maryland, Revenue Refunding Bonds, Wastewater Projects, Series 2002A, 5.125%,	7/12 at 100.00	AA	2,622,867
		7/01/42 – NPFG Insured
345		Baltimore, Maryland, Wastewater Project Revenue Bonds, Series 2006C, 5.000%, 7/01/31 –	7/16 at 100.00	AA	382,146
		AMBAC Insured
660		Baltimore, Maryland, Wastewater Project Revenue Bonds, Series 2007D, 5.000%, 7/01/32 –	7/17 at 100.00	AA	724,818
		AMBAC Insured
430		Maryland Water Quality Financing Administration, Revolving Loan Fund Revenue Bonds, Series	No Opt. Call	AAA	497,659
		2005A, 5.000%, 9/01/15
4,025		Total Water and Sewer			4,227,490
$ 141,287		Total Investments (cost $115,190,817) – 149.2%			121,702,247
		Floating Rate Obligations – (5.2)%			(4,255,000)
		MuniFund Term Preferred Shares, at Liquidation Value – (46.3)% (5)			(37,766,000)
		Other Assets Less Liabilities – 2.3%			1,872,892
		Net Assets Applicable to Common Shares – 100%			$    81,554,139

 

 

 

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Fair Value Measurements

 

Fair value is defined as the price that the Fund would receive upon selling an investment or transferring a liability in an orderly transaction to an independent buyer in the principal or most advantageous market for the investment. A three-tier hierarchy is used to maximize the use of observable market data and minimize the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Observable inputs reflect the assumptions market participants would use in pricing the asset or liability. Observable inputs are based on market data obtained from sources independent of the reporting entity. Unobservable inputs reflect the reporting entity’s own assumptions about the assumptions market participants would use in pricing the asset or liability. Unobservable inputs are based on the best information available in the circumstances. The three-tier hierarchy of inputs is summarized in the three broad levels listed below:

 

Level 1 – Quoted prices in active markets for identical securities.

 

Level 2 – Other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).

 

Level 3 – Significant unobservable inputs (including management's assumptions in determining the fair value of investments).

 

The inputs or methodologies used for valuing securities are not an indication of the risk associated with investing in those securities. The following is a summary of the Fund's fair value measurements as of February 29, 2012:

 

		Level 1				Level 2				Level 3				Total
Investments:
Municipal Bonds		$	—			$	121,702,247			$	—			$	121,702,247

 

 

The following is a reconciliation of the Fund's Level 3 investments held at the beginning and end of the measurement period:

 

		Level 3
		Municipal Bonds
Balance at the beginning of period		$	606,465
Gains (losses):
Net realized gains (losses)			—
Net change in unrealized appreciation (depreciation)			218,377
Purchases at cost			—
Sales at proceeds			—
Net discounts (premiums)			989
Transfers in to			—
Transfers out of			(825,831	)
Balance at the end of period		$	—

 

During the period ended February 29, 2012, the Fund recognized no significant transfers to or from Level 1 or Level 2. Transfers in and/or out of Level 3 are shown using end of period values.

 

Income Tax Information

 

The following information is presented on an income tax basis. Differences between amounts for financial statement and federal income tax purposes are primarily due to timing differences in recognizing taxable market discount, timing differences in recognizing certain gains and losses on investment transactions and the treatment of investments in inverse floating rate securities reflected as financing transactions, if any. To the extent that differences arise that are permanent in nature, such amounts are reclassified within the capital accounts on the Statement of Assets and Liabilities presented in the annual report, based on their federal tax basis treatment; temporary differences do not require reclassification. Temporary and permanent differences do not impact the net asset value of the Fund.

 

At February 29, 2012, the cost of investments was $111,221,625.

Gross unrealized appreciation and gross unrealized depreciation of investments at February 29, 2012,
were as follows:
Gross unrealized:
Appreciation		$	7,652,767
Depreciation			(1,427,157	)
Net unrealized appreciation (depreciation) of investments		$	6,225,610

 

(1)		All percentages shown in the Portfolio of Investments are based on net assets applicable to Common shares
		unless otherwise noted.
(2)		Optional Call Provisions: Dates (month and year) and prices of the earliest optional call or redemption. There
		may be other call provisions at varying prices at later dates. Certain mortgage-backed securities may be
		subject to periodic principal paydowns.
(3)		Ratings: Using the highest of Standard & Poor’s Group ("Standard & Poor's"), Moody’s Investors Service, Inc.
		("Moody's") or Fitch, Inc. ("Fitch") rating. Ratings below BBB by Standard & Poor’s, Baa by Moody’s or BBB
		by Fitch are considered to be below investment grade. Holdings designated N/R are not rated by any of
		these national rating agencies.
(4)		Backed by an escrow or trust containing sufficient U.S. Government or U.S. Government agency securities,
		which ensure the timely payment of principal and interest. Certain bonds backed by U.S. Government or
		agency securities are regarded as having an implied rating equal to the rating of such securities.
(5)		MuniFund Term Preferred Shares, at Liquidation Value as a percentage of Total Investments is 31.0%.
N/R		Not rated.
(ETM)		Escrowed to maturity.
(IF)		Inverse floating rate investment.
(UB)		Underlying bond of an inverse floating rate trust reflected as a financing transaction.

 

 

 

 

 

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Item 2. Controls and Procedures.

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") (17 CFR 270.30a-3(c))) are effective, as of a date within 90 days of the filing date of this report that includes the disclosure required by this paragraph, based on their evaluation of the controls and procedures required by Rule 30a-3(b) under the 1940 Act (17 CFR 270.30a-3(b)) and Rule 13a-15(b) or 15d-15(b) under the Securities Exchange Act of 1934 (17 CFR 240.13a-15(b) or 240.15d-15(b)).

 

 

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 registrant's last fiscal quarter that have materially affected, or are reasonably likely to materially affect, the registrant's internal control over financial reporting.

 

Item 3. Exhibits.

File as exhibits as part of this Form a separate certification for each principal executive officer and principal financial officer of the registrant as required by Rule 30a-2(a) under the 1940 Act (17 CFR 270.30a-2(a)), exactly as set forth below: See EX-99 CERT attached hereto.

 

 

 

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SIGNATURES

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.

 

(Registrant)   Nuveen Maryland Dividend Advantage Municipal Fund 3 

 

By (Signature and Title)     /s/ Kevin J. McCarthy                    

                                                   Kevin J. McCarthy

                                                   Vice President and Secretary

 

Date          April 27, 2012        

 

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 (Signature and Title)     /s/ Gifford R. Zimmerman                    

                                                    Gifford R. Zimmerman

                                                  Chief Administrative Officer (principal executive officer) 

 

Date          April 27, 2012        

 

By (Signature and Title)     /s/ Stephen D. Foy                              

                                                   Stephen D. Foy

                                                  Vice President and Controller (principal financial officer) 

 

Date          April 27, 2012