The city of Bath and town of West Bath have agreed to terms of a settlement in a dispute over funding for Regional School Unit 1.

West Bath will accept $1.25 million in cash to be paid in full within 30 days, the town announced this week. It filed claims against Bath and RSU 1, saying the wrong cost-sharing school funding formula was used for the first four fiscal years of RSU 1, from 2008 to 2012.

The case was set for trial in the Sagadahoc County Superior Court the first week in December after a preliminary ruling last June found that an incorrect cost-sharing formula had been applied to the RSU 1 district. The upcoming trial was expected to focus on the amount of repayment.

The Bath City Council is scheduled to vote Dec. 3 whether to contribute $1.2 million of the settlement; the school district’s insurance carrier would provide the $50,000 balance, according to an announcement by West Bath.

West Bath Board of Selectmen Chairwoman Paula Nelson said in a written statement she was pleased with the agreement.

Selectmen likely will recommend that the settlement money be set aside to for future educational costs, Nelson said.

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