Nebo issues and sells $30 million in bonds

SPANISH FORK — Nebo School District issued and sold $30 million in bonds Wednesday morning to Piper Jaffray Companies.

Wells Fargo Public Finance conducted the sale electronically in Salt Lake City. Piper Jaffray was one of seven bidders. It offered an interest rate of 4.31 percent. Piper Jaffray will find investors to purchase the bonds.

District accountants will use the $30 million for construction projects, building or renovating about 10 schools in the fast-growing district. About 25,000 students attend Nebo schools. Student population is increasing about 1,000 students a year.

In February 2004, residents authorized the district to issue $140 million in bonds for the construction projects. About $43 million in unissued bonds remain after Wednesday's issuance.

Earlier this week, the Federal Reserve opted to not raise short-term interest rates as expected, which surprised the Board of Education.

"That's a pretty extraordinary interest rate," said Dale Okerlund, vice president of Wells Fargo Public Finance.

Prior to issuing the bonds, the district received credit ratings from Moody's and Standard & Poor's.

Moody's gave the Nebo School District a rating of A2. Moody's ratings range from Aaa to C.

S&P gave the district a rating of A-plus. S&P's ratings range from AAA to D.

"The A ratings are good, strong middle-of-the-road" ratings, Okerlund said.