COEUR d'ALENE - Teachers union and school board representatives will be returning to the bargaining table in the Coeur d'Alene School District.

At Monday's school board meeting, Superintendent Matt Handelman told trustees that both negotiating teams have agreed to reopen the contract once the district's funding based on attendance is finalized by the state department of education, likely sometime later this month.

"We have a common interest in looking at the MOU (memorandum of understanding)," Handelman said, referring to an informal agreement reached during last summer's contract talks.

The memorandum of understanding details how excess fund balance dollars will be spent if the district's audited fund balance exceeds a projected amount of $4.9 million.

At Monday's board meeting, auditor Kacie Tollefson, with the Coeur d'Alene-based independent accounting firm, Magnuson, McHugh and Company, presented the school district's financial audit for the fiscal year that ended June 30. The audited fund balance, according to the report, is $7.2 million.

The district's fund balance reached a high of $7.6 million in 2011, and dropped slightly in 2012.

"This is comparative with other districts in the area," Tollefson said.

The memorandum of understanding specifically details how the first $737,000 of excess fund balance will be disbursed.

Under the agreement, the first $84,000 will be used to partially restore a cut to the district's contribution to employee family health insurance premiums. The district will contribute 69 percent. The teachers conceded a 68 percent contribution during last summer's negotiations. The contribution was 71 percent.

The second $222,493 will go into the district's contingency reserve.

The next $284,493 will be distributed to all benefited employees, as a one-time payment, based on the number of hours they work.

Another $146,000 will pay for buses under the agreement.

Anything remaining, beyond that $737,000, will also be distributed as a one-time payment to benefited employees based on the number of hours they work.

Last year, the fund balance was about $1.3 million more than expected. This year, it's $1.9 million.

Handelman said that when the contract is re-opened to negotiations, the bargaining teams will be focusing on the funds that are earmarked under the memorandum of understanding for distribution as one-time payments to employees.

Every year, for the past few years, there have been similar memorandums of understanding in place because during negotiations, the fund balance is always an unknown.

Handelman said that since it's the third consecutive year that the fund balance has exceeded $7 million, they see a pattern.

"Maybe we can consider adding onto the base salaries," Handelman said.

If the funds are distributed as salaries, the money will become part of the annual budget.

"We have to look at how much we can sustain," Handelman said. "It would also be something our employees could count on."

Derek Kohles, president of the Coeur d'Alene Education Association, the local branch of the state teachers union, said the teachers are looking forward to reopening the contract.

"We hope to create a mutually beneficial solution for everyone," Kohles said.