The Alpine Board of Education approved a $93.8 million budget Tuesday that will raise property taxes slightly but won't relieve all of the district's growing financial concerns.

The budget for the 1988-89 school year is nearly $500,000 larger than this year's, mostly because enrollment is expected to increase by about 935 students, or 3 percent.Property owners living within the district will see a 1 percent increase in the property taxes they pay for public schools, but the change will be unnoticeable for most. For example, a resident with property valued at $75,000 will pay about 45 cents more a year. Alpine will get an additional $274,000.

Alpine officials were forced to include the increase in the district's budget because of a state mandate that requires them to maintain a certain levy to support their basic program.

The budget, approved unanimously by the three board members present at the meeting, drew no comments during a public hearing Tuesday. In fact, the meeting was attended almost exclusively by district employees.

Alpine administrators, though, have some concerns about the district's financial state. Superintendent Clark Cox said the capital outlay tax included in the budget will not give the district enough money to meet payment on the bonds it already has out. Part of the bond-payment money will have to come from interest earned and a large chunk will be taken from the maintenance and operation fund, which is used to purchase supplies for students and to pay employee salaries.

The district could have increased the property tax more, but officials believed that move would not go over well with taxpayers.

Another problem for Alpine has cropped up with its medical insurance premiums, which increased 28 percent this year and are expected to jump 22 percent more next year, bringing the annual cost to about $6.6 million. That could increase further once the school year gets under way, and Cox said the problem is becoming unmanageable.

"Something has to be done to get some cost containment on our health insurance. We can't afford these increases. We just can't continue to cut other areas of the budget," he said. "Another area of great concern is the tax initiatives (on the November election ballot) that would reduce property tax rates and state revenues. It is estimated that if the people pass all three (initiatives), it would cost Alpine over $10.8 million.

"The reason I bring this up at budget time is it will have a significant effect on the district. The board better be very careful about expenditures for 1988-89, because you may need every nickel that you have to balance the budget, despite significant cuts."

Alpine has cut its capital projects budget 41 percent, in part to save money in case the tax initiatives pass, and because the need to construct new buildings is decreasing. The budget was just over $6 million in 1987-88 and will decrease to about $3.5 million next year.

Although the district is still growing, it is mostly because more kindergarteners are starting school each year than seniors are graduating. Enrollment studies project growth will peak in about five years, so until then, portable units and productivity programs like extended day and extended year will be used to deal with growing school populations.

The district will spend about $1,204 per student next year, which is about same as during 1987-88.

The budget does not include salary increases. In fact, district administrators are negotiating with teacher representatives now to slightly reduce some benefits.

Copies of the budget are available at Alpine's central office in American Fork.