Received "SCHEMA_NAME is not a recognized function name" error when connecting to the database (4255032)

When attempting to connect to SQL Server 2005 under Reverse Engineering, I received a "Schema_name is not a recognized function name" error. However, the connection tests successfully in the connect dialogue.

Execute MS SQL Server 2005 script instead of 2000 script.

In the Reverse Engineering connection window, make sure to select the proper database platform from the execute script drop down list pertaining to your database version. For example, if your MS SQL Server is on 2000, then you must select MS SQL Server 2000 execute script.