Updated at 5:30 p.m.: Revised to include reaction to House vote.

AUSTIN -- The Texas House on Wednesday passed landmark school funding legislation that would give 650,000 teachers and staff members a minimum pay raise of roughly $1,850, increase funding for every school district in the state and give property owners some modest tax relief.

By a vote of 148-1, the House advanced its top priority of the session: overhauling the way public education is financed by the state and infusing schools with new money to improve student achievement.

In particular, lawmakers want schools to boost third-grade reading levels, which lag behind the national average.

"It's a great day for the students of Texas, it's a great day for their parents, it's a great day for the teachers who educate them and it's a great day for everyone in education," House Speaker Dennis Bonnen, R-Angleton, said in a celebratory press conference after the vote.

For Dallas ISD, the bill boosts funding by $823 per student, or $114 million in 2020. It would lower the property taxes of a house valued at $191,000 by $153.

House Bill 3 was authored by Rep. Dan Huberty, R-Humble, who chairs the House Education Committee. The bill pumps $6.3 billion of new money into public schools over the next two years, increasing the minimum per-pupil funding from $5,140 to $6,030.

It follows Dallas ISD’s lead by setting aside $140 million for the poorest schools to attract the top-ranking teachers to work in the toughest settings.

And it sets aside $2.7 billion for property tax relief -- by lowering all school district tax rates by at least 4 cents.

The most significant change made to the bill on the House floor came from Grand Prairie Democrat Rep. Chris Turner, who proposed an amendment to guarantee that the new money for schools would lead to a minimum salary increase of about $1,850 for every teacher and staff member.

Turner's amendment requires that anytime the state takes action to increase the minimum per student funding for schools -- called the basic allotment -- districts would have to use 25 percent of those dollars for an across-the-board raise for every employee that is not an administrator.

The amendment signals House members are willing to compromise with the Senate, which has drawn a line in the sand over their plan to give every teacher in Texas a $5,000 pay raise. The Senate’s $4 billion pay raise bill is the top education priority of Lt. Gov. Dan Patrick, who presides over the upper chamber.

Now, the Senate’s bill is headed to the House and the House’s school funding bill is headed to the Senate. Both chambers have vowed to fix school funding this year, but teacher pay has become a sticking point.

"The lieutenant governor believes that aside from a parent, nothing has more impact on the success of a child than a teacher -- and he appreciates that the House has taken a first step toward an across the board pay raise," said Alejandro Garcia, a spokesman for Patrick.

Bonnen acknowledged that the Senate would likely have a different spin on public education financing, but he predicted the two chambers would ultimately come together.

"We're having great conversations with our friends in the Senate," he said. "We expect them to pick up House Bill 3 and do what happens in this process and that is put their take on school finance on it... Then we go to conference and we resolve the differences and deliver success for the people."

DISD superintendent not totally pleased

DISD superintendent Michael Hinojosa said Wednesday he was not totally pleased with the House's move to adopt Turner's across-the-board pay raise amendment because it took some of the district's flexibility away, but added that the provision reflected the "art of compromise."

DISD, which employs a merit-based system of compensation, already planned to give its employees a pay increase after the passage of a recent tax election, but the district did not intend to extend those raises to employees whose performance had been unsatisfactory. The amendment would require the district to give an estimated $1,850 raise to all employees, including those who are unsatisfactory.

"Some of our under-performing employees may not have gotten this amount of salary, but that’s how the process works. You’ve gotta have a give and take," Hinojosa said. "The entire bill is very good to us. This is one slight modification that we’ll just have to comply with but it’s certainly acceptable in the grand scheme of things."

One thing that’s not currently included in the bill is merit pay. Initially Huberty included a $140 million merit pay program in the legislation, but he stripped it out after teacher groups expressed dissatisfaction.

The Senate has signaled, through Senate Education Chairman Larry Taylor's stated priorities, that it could pursue merit pay once it gets Huberty’s bill.

Huberty’s bill, which has a $9 billion price tag over the next two years, overhauls funding formulas that direct additional money toward schools for serving low-income students, students with learning impairments and for offering dual language programs.

It funds full-day prekindergarten for low-income students and creates a grant program for schools that want to extend the school year by 30 days to stem academic losses for at-risk students during the summer.

Celebration by all but one

The bill was applauded by Democrats and Republicans alike and celebrated as a bipartisan victory among members.

Only one member voted against the plan, Bedford Republican Rep. Jonathan Stickland, a member of the conservative Freedom Caucus. Stickland could not be reached immediately for comment. During debate he took issue with the provision of the bill that allows schools to extend the school year, characterizing it as an attack on summer vacation.

Rep. Diego Bernal, D-San Antonio, said the bill is one of the most transformative pieces of legislation the House will pass.

“There are few times in our lives, that one year to the next, we can change the trajectory of people’s lives,” he said. “But next year, when this comes into effect things will be different, drastically.”

Austin Bureau correspondents James Barragan, W. Gardner Selby and Lauren McGaughy contributed to this report.