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While the teachers union and LA Unified are united in spirit that the district should not lose $47 million in state money over faulty attendance record keeping, their disagreement on another issue could cost them nearly four times as much from Washington.

The district has until March 31 to apply for federal waiver that allows LA Unified to replace No Child Left Behind accountability rules with its own school improvement system. It is called the California Office to Reform Education (CORE) Waiver, and it would generate $171 million in federal revenue over three years.

But to win the waiver, the district and UTLA must agree on a teacher evaluation system that includes a minimum of three rankings. That has been a sticking point in contract negotiations over the past seven months. Without an agreement with the union, the district may be in jeopardy of disqualifying itself from receiving the money.

Alex Caputo Pearl, president of UTLA, says the issue is on the agenda tomorrow as part of the first mediated session between the two sides.

“It’s one of the things we’re going to hammer out in mediation,” he told LA School Report.

In 2013, the district implemented a new overall teacher evaluation system that raised performance levels to four from two. The union objected, saying it never agreed to the new terms and argued that the new system created a path to establish merit pay to reward the highest performing teachers. The union took the issue to the labor board, and a PERB judge agreed with UTLA, that the district acted unlawfully, and ordered the two sides to renegotiate the terms.

In anticipation of the looming deadline, Superintendent Ramon Cortines last month sent a letter to UTLA, suggesting that the union and the district work toward an agreement on the single issue. But it never came.

While Caputo-Pearl admitted the waiver would help shrink the district’s estimated $180 million deficit for the 2015-16 school year, he says it comes with strings attached, unlike the money generated by average daily attendance.

“[The CORE money] can only be applied to certain things,” he explained, “whereas the $47 million is General Funds. It can be generally applied to class size, staffing, and other uses. The CORE Waiver money has certain constraints.”