Sure, the Utah County city 15 miles west of Lehi still must repay the bonds it issued in 2001. But, thanks to restructuring of the bonds, Eagle Mountain's yearly payments on the $21 million issue will not be as steep.

Try about $680,000 instead of $1.3 million.

"This puts the city in a good, long-term financial position," City Administrator Chris Hillman said Monday.

Eagle Mountain bonded the $21 million in 2001 to purchase infrastructure for its gas and electric systems. But since the city's financial house was in disarray, and it didn't have a large enough pool of gas and electric users, it couldn't secure a bond rating.

Bottom line: Eagle Mountain had to cough up top dollar in interest and pay a bank about $350,000 a year to insure the bonds.

Now, under the restructured bonds, this growing city of 10,000 people has earned a double-A rating and has qualified for a lower interest rate.

"Eagle Mountain will save millions" over the life of the bonds, Hillman said.

City administrators said the restructuring was necessary to stabilize the city's debt. About $3 million of the initial bond was set aside as capitalized interest to help the city make its bond payment. With that money gone, Eagle Mountain was facing higher payments.

Mayor David Lifferth said the bond rating and lower rates are indicative of the growing maturity of the fledgling city - it was incorporated in 1996. It also reflects the fact that Eagle Mountain has more gas and electric users and, consequently, more revenue to make payments.

"This proves that we are now a much better risk when it comes to borrowing money," Lifferth said. "In the past, because we were not turning our [financial] reports into the state on time and other problems, we were unrated and paying top dollar to borrow money. . . . So this will be a significant savings for a small and growing community like Eagle Mountain."

meddington@sltrib.com