Fifteen states and Washington DC made it to the finals of the first round of the Race to the Top (RttT) – Colorado, Delaware, the District of Columbia, Florida, Georgia, Illinois, Kentucky, Louisiana, Massachusetts, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, South Carolina, and Tennessee. The Secretary of Education has stated “we expect no more than half of the money will be awarded in phase 1 to ensure a robust competition in phase 2.” So assuming that this means that around $2 billion will be distributed in this phase, this tells us a lot about how the finals of round I will look. There has been a lot of flack in the blogs about too many states making it into the finals. (See my colleague Chad’s post below for links).

In the end how many states receive grants is a combination of the quality of the grant and some simple math. At the end of the second round, it is clear that all of the $4 billion will be granted to states. It seems reasonable to distribute half of the funding in the first round and the other half in the second round, especially when the more obvious states and easier to justify states will be the ones funded in the first round. Choosing states in the second round will be a much more difficult set of decisions.

Two key decisions will have a big impact on how many states win grants. First, are states funded at the level that they requested or are they funded at the non-binding estimates that the Department proposed before the applications were submitted. In developing these grant ranges, the Department was sending a strong signal that they wanted a lot of winners. If all states received the max of the proposed funding range, it would total – around $12 billion. So when the Department set their non-binding funding ranges, the expected that around one third of states would win RttT grants – somewhere around 16 states.

Many states decided to apply for much higher grant amounts than the suggested max. Will the Dept only provide grants in the proposed range or will they fund out of the grant range. States have put the department in a difficult position here because states can not reduce the policies that they will implement if they do not receive the entire grant proposal. So for example, I am assuming that Florida will win (which does not appear to be a big leap). Florida proposed a $1.1 billion reform package, and the Department proposed max for Florida was $700 million. Ed Week reports on the options that the Department has in negotiating with states to change budgets.
My guess is that the Department will be able to reduce the requests of states somewhat, but for a handful of states that are substantially above, the dept will need to fund states above the suggest maximums. Since none of the criteria are about the budget itself, states will not be penalized to their higher budgets.

Second, I am assuming that Florida will get a grant, but New York will not (although New York City will be competitive if the $1.35 billion RttT extension funding is provided in the budget year). If both FL and NY win and received the funding they proposed, then the competition is over, and the rest of the states get left behind. This is another reason that I think NY will not make it.

The table below shows non-binding ranges proposed by the Department, and the actual proposal levels for the various states. If each of the state’s applied for the maximum grant in their size category, then these states would have a combined demand for around $4.8 billion. It turns out that non-binding funding ranges aren’t very binding. And virtually every state asked for at least the maximum, and many more than it. The combined ask of these states was $6.4 billion.

Dept.’s Non-binding Grant level	Max. Recommended Grants	Proposed Budget by state	Combined Proposed Budgets
Category 1. $350-$700 million	$1.4 billion	New York (830 million), Florida ($1.1 billion)	$1.93 billion
Category 2. $200 – $400 million	$2 billion	Illinois ($510 million), Pennsylvania ($400 million) , Ohio ($410 million), Georgia ($460 million), North Carolina ($400 million*)	$2.110 billion
Category 3. $150-$250 million	$500 million	Massachusetts ($287 million), Tennessee ($502 million)	$789 million
Category 4. $60-$175 million	$700 million	Colorado ($377 million), Louisiana ($314 million), South Carolina ($300 million), Kentucky ($200 million)	$1.291 billion
Category 5 $20-$75 million	$225 million	Rhode Island ( $100 million), Delaware ($107 million), Dist. Of Columbia ($112 million)	$319 million
Total	$4.825 billion		$6.4 billion

Assuming NY out, and that the Department funds states somewhere in between the maximum suggested grant level and a state’s proposed budget. So, if the Department is going to distribution around $2 billion, only 5 or 6 states will win the first round. It seems like the department can send the message and set the stage for the second round with this level of selectivity, and perhaps quiet some critics (at least until they select states in the second round). Which states?

Here is my bracket:

Florida wins taking up just less than half of the $2 billion ($950 million). The reforms that they have implemented over the last decade are too much to compete against. This leaves just over $1 billion for the remainder of states. My guesses for other states are Massachusetts, Louisiana, Colorado and Delaware all funded somewhat below their requested budgets for a total of 5 states.