AUSTIN — Unable to agree on a tax swap bill, House and Senate leaders focused Tuesday on compromise school finance legislation — including a small raise for teachers and several education initiatives — that they hope to approve before their special session expires tonight.

A tax bill trading billions of dollars in property tax reductions for higher taxes on consumers, smokers and some businesses will wait until a new special session, but lawmakers are moving closer to an agreement, leaders said.

And Gov. Rick Perry promised that he will immediately summon lawmakers for another session that will begin as early as Thursday.

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Chat transcript: Schools and taxes

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“If we need to be here all summer getting this done, we will,” said Mr. Perry, who offered the Senate a new tax proposal that’s also backed by House Speaker Tom Craddick. It includes key concessions, including a slightly smaller increase in the state sales tax that matches the Senate’s last proposal.

Meanwhile, House and Senate members got their first look at the compromise measure that overhauls education funding and enacts several changes for Texas schools.

The legislation’s fate today is unclear, but it is expected to pass in both chambers. Many of its provisions won’t take effect, though, unless the tax bill is passed soon as well.

While sponsors touted its new money for schools and efforts to improve accountability for teachers and school districts, Senate Democrats, teacher groups and education associations predicted the proposal will do little to improve public schools.

Teachers are guaranteed $1,000 each this fall, an average 2.5 percent raise. AnotherAn additional $500 per teacher will be allocated to school districts, but districts will decide whether they want to give that money to each teacher or use it for merit pay to reward certain educators.

Next year, there is no additional money for another across-the-board raise, but districts will receive an extra $500 per teacher for incentive pay programs.

Teachers fuming

The proposal enrages teacher groups, which say it treats teachers unfairly and could encourage cheating on standardized tests.

Richard Kouri of the Texas State Teachers Association said the meager pay raise does not live up to legislative leaders’ rhetoric about trying to raise pay to the national average. Texas falls about $6,000 short of that mark, paying teachers an average salary of about $41,000.

“If they’re satisfied being 32nd in the nation on teacher pay and having 53,000 uncertified teachers in Texas classrooms, then this is the way to maintain the status quo,” Mr. Kouri said.

Most school districts and education groups contend that the measure would provide little more than an inflation adjustment, far short of what a state district judge has said is needed to adequately educate Texas children. The measure provides about $2.4 billion in additional money over the next two years, an increase of 3.5 percent.

Senate Democrats joined the opposition Tuesday after Republican leaders agreed to add a provision that limits how much tax revenue property-rich schools districts have to give up under “Robin Hood” requirements in the school finance law.

Both Democrats on the 10-member House-Senate committee that hammered out the compromise bill — Sens. Royce West of Dallas and Leticia Van de Putte of San Antonio — refused to support the measure. All eight Republicans on the panel signed on.

Ms. Van de Putte called the legislation a retreat on the standards that have provided equal funding for wealthy and poor school districts over the last decade.

“I cannot vote for something that is going to increase the gap between the very wealthiest districts and all the other districts,” she said.

The San Antonio Democrat said the change would give wealthy districts, which already can spend several hundred dollars a year more on their students, an extra $400 a year over what other districts spend.

Rep. Dan Branch, R-Dallas, who sponsored the limit on “Robin Hood” sharing, said it is unfair that high-wealth school districts such as Highland Park have to surrender nearly 70 percent of their property tax revenue to other districts. His amendment would eventually scale that back by nearly half.

Sen. Florence Shapiro, the Plano Republican who led Senate negotiators, said standards to equalize funding between property-rich and lower wealth districts “go way beyond what the courts have required” in Texas. The money lost by cutting back on revenue-sharing will be made up by the state.

Mr. West said he couldn’t back the legislation because it has no support among the people it would most affect.

“I can’t find anyone, any school professional or elected official in my senatorial district who is for this bill,” he said.

The proposal also would establish a mandatory starting date for all schools — the Tuesday after Labor Day — and create a $250 million incentive pay program for teachers that would begin with the 2006-07 school year.

In addition, it increases money for bilingual education, beefs up state requirements for independent charter schools and moves the date for local school board elections from the spring to the regular November election in even-numbered years. That change was a victory for House leaders, who insisted it be inserted into the bill.

Closer on tax deal

On taxes, House and Senate leaders inched closer to an agreement that would raise a handful of state taxes to finance a cut in school property taxes of $2.5 billion this fall and about $3.1 billion in the fall of 2006.

A compromise has eluded lawmakers all year, and no final action is expected until the next special session begins later this week. A special session, which can last up to 30 days, can only be called only by the governor.

Besides lowering their proposed sales tax rate to 6.95 percent — still up significantly from the current 6.25 percent — the governor and speaker also dropped a House proposal to levy the sales tax on bottled water for the first time.

As closed-door negotiations continued throughout the day on Tuesday, the list of differences between the two chambers was gradually whittled down to a few key issues.

Among the final disputes was House resistance to a Senate plan to shield the poorest Texans from the higher sales and consumption taxes. Senators want people on welfare and food stamps to receiveget back up to 20 percent of the sales tax they pay each year.

Questions remained about whether the tax bill can win majority support in the House — with some business groups still lobbying hard against proposals that would close loopholes in the business franchise tax and make their companies start paying the tax.

At any rate, But there were no questions about the governor’s intention to keep lawmakers in Austin until they reach a deal.

“The idea that we will walk away from the most important issue that this Legislature deals with is nonsense,” Mr. Perry said. “We have to pass both of these bills. We can either do them now or some other time this summer.”

THE COMPROMISE

Some provisions of the school finance compromise that legislators will vote on today:

Spending: Would add about $2.4 billion to state education funding over two years, an increase of about 3.5 percent. All districts would be guaranteed at least a 3 percent boost.

"Robin Hood": Would cap at 38 percent the amount that wealthy districts must share with poorer ones. The limit would be phased in.

Teacher pay: Would give all teachers a $1,000 pay raise this year and provide districts money to offer an average of $500 more. Districts could decide how to dole out the money, along with another $500 next year.

Merit pay: Would require districts to reward teachers whose students perform well on standardized tests.

School start date: Would require districts to start classes the Tuesday after Labor Day.

Textbooks: Would replace funding for books with a new allotment that could also be spent on new technology. Districts would be allowed to select books and instructional materials.

Accountability: Would ensure districts spend at least 65 percent of their budgets on classroom instruction and would be measured on how well students in bilingual education programs learn English.

Board elections: Would let districts elect trustees only in November of even-numbered years.

SOURCES: Texas Legislature; Associated Press