The union representing St. Paul's teachers has countered a district threat to sue it over a potential multimillion-dollar health-insurance dispute by offering to take the issue into mediation.

The St. Paul Federation of Educators (SPFE) proposed Wednesday that the two sides meet by the end of next week.

"We are educators. We are problem-solvers. This is something we should be able to sit down and talk through," SPFE President Nick Faber said in an interview Thursday.

This spring, SPFE and Teamsters Local 320 voted to switch from the district's existing insurer, HealthPartners, to the state-run Public Employees Insurance Program (PEIP). But the move would come in the middle of a two-year contract with HealthPartners, triggering a $4 million penalty for the district.

Last week, the union offered to delay the move to January 2021 if the district boosted individual and family benefits to reflect the savings members could have received next year. SPFE said its proposed compromise would total about $1.5 million; the district said it actually would cost about $3.6 million.

The district accused the unions of bad-faith bargaining and threatened to sue them for "any and all damages" if they proceed with plans to switch insurers in January.

The proposal to work with an independent mediator was offered late Wednesday afternoon. The district has yet to issue a formal reply. Kevin Burns, the district's communications director, told the Star Tribune on Wednesday that leaders and board members were thoroughly reviewing information and considering all options.

SPFE noted previously that members were unaware of the $4 million penalty until the district shared concerns about it online when voting already was underway.

Asked if there could be a new vote, Faber said members want to enter PEIP and "it's just a question of when and working out the details."