After months of battling with the Christie administration, New Jersey's largest teachers union announced Thursday that it would support the state's second-round bid for up to $400 million in federal education stimulus aid.

In a rare instance of cooperation between the administration and the New Jersey Education Association, negotiations led to compromises on some key areas in the state's Race to the Top application, according to union officials.

The announcement came just days before the application deadline Tuesday.

In the state's unsuccessful first try, the NJEA opposed New Jersey's application, and very few local association presidents signed on to their districts' letters of intent to participate. Though no one factor caused the state's application to fail, federal evaluators did take note of the dearth of labor support.

In a letter sent Thursday to state Education Commissioner Bret Schundler, NJEA president Barbara Keshishian and executive director Vincent Giordano said they would recommend that all local presidents sign on this time.

"We look forward to working closely with the New Jersey Department of Education in implementing the principles, practices, and policies incorporated in the state's Race to the Top application," the union officials wrote.

Schundler said in a written statement that he welcomed NJEA's support.

"The NJEA's support for our Race to the Top application supplements the endorsements we have already received from the American Federation of Teachers affiliate in Newark and from the superintendents and school board presidents in more than 430 districts," the commissioner said.

District support and intent to participate also figures in the scoring of grant applicants. Of about 600 districts and 67 charters statewide, 355 districts and 23 got their intent memos in by the first application deadline. Only about 20 had union support.

Education officials declined to discuss specific areas of compromise Thursday.

However, Dawn Hiltner, an NJEA spokeswoman, said one topic was merit pay, which the union had opposed in the state's first application.

The state wanted it in again, but Hiltner said NJEA favored school-based rewards. In a compromise, she said, they agreed on a pilot program that would give achieving or progressing districts additional money. Half would be used for schoolwide improvements. How to distribute the other half would be decided locally, including possibly using it for teacher-pay incentives, she said.

Hiltner said the state officials also had agreed to consider measures of achievement beyond standardized tests. The two sides agreed to work together to improve the tenure system, she said, and union representatives will be among the participants on a committee to review and revise the teacher-evaluation process.

One measure still in the proposal that Hiltner said gave the union reservations is a plan to offer financial incentives to teachers deemed highly effective who work in low-performing schools.

Because the grant money is finite, Hiltner said, the union is concerned about creating an unfunded mandate.

Overall, however, both sides really worked together, she said.

"We made a lot of progress," she said. "We've been meeting with the department a lot."

Race to the Top, established with $4.35 billion last year, is highly competitive and intended to reward and further educational innovation and reform. In the first round, 40 states and the District of Columbia applied. Only Delaware and Tennessee were awarded money. New Jersey placed 18th.

The second-round winners will be announced in late August or early September.

Contact staff writer Rita Giordano at 856-779-3841 or rgiordano@phillynews.com.