AMERICAN FORK — Taxpayers received some good news Tuesday — if a tax hike can be seen as good news, that is.
A sterling credit rating and the dearth of news that would rattle Wall Street were among the reasons Alpine District was able to lock into a lower-than-expected interest rate on a $40 million bond issue.
Alpine sold the bonds Tuesday to Wells Fargo at a 4.854 percent interest rate.
That translates to a lower property-tax increase than Alpine's Board of Education projected when voters approved a bond sale to pay for new schools in the rapidly growing school district.
Keith Bradford, Alpine's business administrator, said the bond issue will increase yearly property taxes $12.05 on a $150,000 home.
The low interest rate and higher assessed values of homes and businesses in the district's boundaries contributed to the lower tax hike.
Officials previously expected the tax increase to reach $18 yearly for owners of $150,000 homes.
Five investors entered bids over the Internet before the 9:30 a.m. deadline to buy the bonds, which is the first phase of a $200 million public-revenue package approved by voters in May.
Wells Fargo entered the most attractive bid on the 15-year bonds. Alpine's Board of Education approved the sale Tuesday.
Alpine has a solid Aa3 bond rating. Moody's Investors Service, considered by bond buyers as reputable evaluators of investment risks, last year upgraded the district's bond rating from A1.
Empey said Moody's was pushed to upgrade Alpine's rating to Aa2, which could come in the next 12 to 18 months. It depends on the rating given to Jordan School District. Residents in Jordan have an annual average income that is $24,000 higher than Alpine's. If Jordan is upgraded to Aa1, then Alpine can go to Aa2, Empey said.
The $40 million will pay for two elementary schools and a junior high school, additions to two existing schools and land for future schools.
The district's debt burden is 2.6 percent.