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WHEELING - A $1.6 million shortfall in private funding for the J.B. Chambers Performing Arts Center at Wheeling Park High School has the Ohio County Board of Education seeking a loan from the state.

During a special school board meeting held at noon Monday, Superintendent George Krelis told board members that, due to a lack of adequate private donations for the estimated $10 million performing arts center, a loan was the best option at this time. He asked the board's approval to apply for $1.6 million in Qualified Zone Academy Bonds from the West Virginia School Building Authority. The loan would be paid off at a rate of $107,000 per year with zero interest.

"We can apply for up to $2 million to be paid back over 15 years interest free," Krelis said. "I think this is an excellent choice that allows us to accomplish many things. It also would free up money for other uses."

Krelis said the bonds, coupled with savings from refinancing of the 1997 school bond debt, would allow the board to move forward with the arts center project without compromising any portion of the board's annual $56 million operating budget. Prior to his retirement, former superintendent Lawrence Miller had initiated the refinancing project for the school system's 1997 bond issue.

Krelis' request was met with many questions from school board member Howard Corcoran, who asked whether the amount the board would borrow would adequately cover the cost of the project as it has been rebid.

"What worries me is that we are in the toughest of economic times. Our tax dollars are shrinking. It concerns me if we have enough to take care of our staff and facilities without leaving a legacy of debt to future boards and the community," Corcoran said.

Board member Erik Schramm said local tax collections were up this year.

"Even in floods we've had a $300,000 cash carryover," Schramm said.

Board President Thomas Innocenti said that in the 1970s, the school board made similar commitments to projects when the economy was in trouble.

"It was tough then. ... We had to stand in line for gas. We've been through tough times before, and we'll get through this," he said.

However, Corcoran said during a September meeting with Gov. Joe Manchin, the governor told his group that by 2013, schools could be in danger of losing their supplemental packages from the state.

"If coal goes down in this state, our revenue could be lost," Corcoran said. "Should we mortgage our future for a building?"

Corcoran said the way the Qualified Zone Academy Bonds program is set up, the school board is not permitted to repay the loan early even if the board has the money to do so.

Krelis said the school system has managed to maintain a significant cash carryover each budget year, even during difficult times such as when major flooding hit the area. He said a portion of the cash carryover could be dedicated to repayment of the Qualified Zone Academy Bonds each year.

Krelis said the loan would not cost taxpayers any additional taxes.

Following the discussion, the board unanimously approved a motion to allow Krelis is move forward with the state funding application. In addition to Corcoran, Innocenti and Schramm, board members Sam Andy and Jim Jorden voted for the measure.

To date, Ohio County Schools has received a $5 million grant from the West Virginia School Building Authority, a $1 million donation from the J.B. Chambers Memorial Foundation and $3.4 million in private pledges toward the arts center project.

Krelis' request comes on the heels of the board's rejection on Oct. 2 of all bids submitted for construction of the project. Krelis said the board threw out the bids because there is a need to further examine "the options out there available." That move delayed the start of construction by about six weeks.

The latest move to acquire the state loan could add to that delay.