A student at Culley Elementary School reads along in drama club on Monday at the Clark County School District empowerment school. Photos by Samantha Clemens. John C. Hughes, a teacher at Culley Elementary School, waits with students until they are picked up after drama club on Monday. Bills are being heard in both houses of the Legislature for empowerment schools such as Culley.

CARSON CITY -- Democrats will not support Gov. Jim Gibbons' bill to establish 100 "empowerment schools" next year as long as it is funded by scrapping an existing $60 million incentive program for teachers, a Democratic party leader said Monday.

Sen. Steven Horsford, D-Las Vegas, said there can be no compromise by Democrats on Gibbons' bill to create empowerment schools as long as the governor pays for his plan by terminating a program that gives teachers retirement credits for working in schools in poorer neighborhoods.

"That is not going to fly," said Horsford after a meeting of the Senate Human Resources and Education Committee.

In a bill introduced in the Assembly, Democrats proposed instead to junk the retirement credit program and use the $60 million to give teachers who work in schools in poorer neighborhoods an additional $4,000 a year in pay.

At the meeting, Horsford presented his Senate Bill 304, which calls for creating at least 21 empowerment schools without spending any additional money.

Gibbons' legislative assistant Jodi Stephens at the same hearing discussed Gibbons' Senate Bill 238, which would establish 100 empowerment schools in 2008-09 by using the retirement credit funds. Each of the schools would be given an additional $550 per student.

Under both bills, principals -- working with teachers, parents and community leaders -- would be given most of the control over spending and the curriculum in their schools. Under the current system, power over schools largely rests with the school district's central administration.

"The goal is to keep decision-making closest to the student," said Stephens, who cited statistics that achievement has improved where empowerment schools have been created.

Chairman Maurice Washington, R-Sparks, noted the similarities of the bills and expressed hope that ultimately Democrats and Republicans will compromise on a bi-partisan empowerment bill.

"For the most part the bills are the same," he said. "It lends itself to some great collaboration."

But he told Horsford he doubted principals could establish empowerment schools without increasing spending.

White Pine County Middle School Principal Eric Hansen testified that empowerment schools will fail unless they receive additional funding. "It would be like asking a boxer to get in the ring with his hands tied," said Hansen, who has been given empowerment authority over his school.

Horsford said that there are grants available for schools. A $78 million program started two years ago allows individual schools to apply for funds to pay for programs of their choosing. The total amount available has been reduced to $55 million for the next two years.

White Pine County school officials used funds from this grant program to secure $167,000 for computers and other supplies at the middle school.

Hansen said the program provided sufficient money for his empowerment school.

He testified that Superintendent Bob Dolezal directed him to meet with teachers and turn his school into an empowerment school. Hansen said they came up with plans to teach they way they wanted to teach.

"I dared them to dream," he said. "We needed to remind ourselves why we became teachers in the first place."

Horsford was amused by the irony of the normally fiscally conservative Washington advocating spending $60 million on empowerment schools, while the Democrats were not asking for any additional spending.

"Senator, this is the first time you are advocating for more money and I am not," quipped Horsford, the Democratic National Committeeman for Nevada.

"It is the shifting of money, not advocating more money," Washington replied.

Washington later said he hoped Gibbons' staff will work with Horsford to reach a compromise. But, he said, the dispute over funding may not be settled until the end of the session. "Hopefully we won't go into a special session," Washington said.

The Legislature is scheduled to adjourn June 4. Under a constitutional amendment sponsored by Gibbons, the Legislature must approve educational funding before approving other parts of the state budget.

There are "other forces in play" in the education funding debate, Washington said. One is that Democrats want to establish full-day kindergarten at all elementary schools, a policy that would cost $73 million, Washington said. Funding for statewide full-day kindergarten is not in the governor's budget.

Following the hearing, Stephens said that she is willing to work with Horsford on a compromise.

She noted that Gibbons wants to end the $60 million retirement credit program because the state's 17 school district superintendents said in a report that it is not effective. The superintendents recommended replacing the retirement credit program with other teacher incentive programs.

Gibbons' empowerment program qualifies since it is a grant program under which $15 million will be earmarked for teacher incentive pay, according to Stephens.

Dolezal suggested the $60 million retirement credit fund be converted into a fund that would allow teachers to pay off college loans and debt.