SUGAR CITY – The negotiation deadlock between the teachers’ union and school board in Sugar-Salem isn’t over – and won’t be for at least two more months.

Roughly 20 teachers gathered at the district’s office late Monday night to await an agreement between the Sugar-Salem Education Association and the school board. Despite the help of a professional mediator, the parties adjourned at 1 a.m., deadlocked over salaries. Negotiators agreed to await an August audit to clarify the district’s financial status — and determine whether the district can meet the union’s request for 3 percent raises.

Superintendent Alan Dunn said the audit won’t be available for review until October – three months after the district’s July 22 teacher contract deadline. (As of Monday, 13 of the district’s 84 teachers had not signed their 2016-17 contracts, which reflect last year’s negotiated salaries.)

Earlier this month, these teachers were notified that their jobs could be open to other candidates.

After health benefits stalled negotiations three weeks ago, SSEA president Kathy Nelson informed trustees that several teachers could leave Sugar-Salem if the district stopped covering health care premiums for employees’ family members.

Trustees agreed Monday to extend those benefits, and the district will cover health insurance premiums for any employee working more than 30 hours a week, business manager Becky Bates said.

However, the district didn’t budge on the union’s request for a 3 percent pay raise. SSEA members originally requested a 4 percent raise but reduced it Monday night.

Last year, negotiations in Sugar-Salem went to mediation and extended late into September, when an audit revealed the district had more carryover money than administrators expected. As a result, trustees granted an across-the-board 3 percent raise to teachers.

“We’re hoping it (the audit) will again give us a clearer picture of where we are,” Dunn said.

The district has agreed to provide a 3 percent raise to classified staff. But  $25,000 in pay raises for administrators – including an 8.84 percent bump for Dunn himself – have some teachers questioning the severity of the district’s financial hardships.

“We are disappointed in the impasse,” said Nelson, “but we are going to take them up on the audit, so we can get a clearer understanding.”

Dunn said administrative raises represent only a fraction of the money needed for an across-the-board 3 percent raise for teachers, and that the impasse is largely a reflection of state funding and declining enrollment.

“We are 115th of 115 districts in Idaho in terms of property value,” he said. “That makes passing a levy very hard here. Even a tiny levy can cost patrons a lot, whereas in Sun Valley, they wouldn’t even notice a difference.”

Salary gaps in districts across Idaho are wide, and some have a much easier time passing supplemental property tax levies to supplement teacher pay.

The state’s complicated funding formula also funds districts based on students’  average daily attendance. Dunn projects a decrease of 49 students in 2016-17, which will affect the district’s funding.

Sugar-Salem’s 2015-16 fall enrollment was 1,567, down from 1,583 a year earlier.

“It may appear that things are contentious between the board and SSEA,” Dunn said, “but I am pleased to see both parties handling this with respect for each other and a positive desire to move forward.”