A decision has been made in the contract negotiations between District 77 and Mankato area teachers, represented by Education Minnesota.

Superintendent Sherri Allen says the arbitrator ruled in favor of the District’s final contract offer. The decision comes about a week earlier than anticipated.

In his written ruling, Arbitrator Stephen Bard says the District and the Union disagreed on five main issues: salary schedule steps; health reimbursement account contributions; health insurance contributions; the hourly wage for Early Childhood and Family Education and Adult Basic Education teachers; and the refund of negotiated insurance payments.

According to Bard, the District’s main argument was that Mankato teachers’ compensation was above average compared to other Big 9 schools while the districts revenues are below the average. Gloria Blaine Olsen, representing District 77, argued the District is experiencing a “unique and severe financial downturn and revenue crisis with no end in sight.”

Based on the District’s “cast-forward” accounting method, the District’s contract proposal was about $1.6 million less than the Union proposal.

In Bard’s ruling, he writes the focus of the Union’s argument is that the accounting method used by the District is flawed. The Union suggested a “structural balance” method instead.

Bard says even if the structural balance is a more accurate accounting method, the Union’s proposal would cost about $1.4 million more than the District’s final offer.

Bard wrote in his decision he ruled “with enormous reluctance” in favor of the District because “the reality of the financial times we live in compel the result.”

Allen says the outcome of the contract negotiations will have an impact on the budget adjustments proposed last month.

“We’ll look at those level one adjustments and look at what we need to do between level two and three. But honestly, this makes us look at things differently,” Allen said.

District officials will meet with the Mankato school board next Thursday to review proposed reductions and possibly make revisions.