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By threatening to revoke Hawaii鈥檚 $75 million Race to the Top award for failing to make 鈥渁dequate progress鈥� on key milestones of its education reform plan, U.S. Secretary of Education Arne Duncan is putting other grant winners on notice that they must live up to their grant promises or risk losing millions of dollars in federal money.

The restrictions on Hawaii鈥檚 grant money for 鈥渦nsatisfactory performance鈥� amount to a warning shot as the U.S. Department of Education seeks to hold 11 states and the District of Columbia accountable while allowing them some wiggle room in making dramatic education changes over the four-year grant period.

As early as this week, the department is expected to issue formal progress reports that will detail just what has鈥攁nd has not鈥攂een accomplished by each winner in the $4 billion , President Obama鈥檚 signature education initiative.

Mr. Duncan said in a conference call with reporters last month that he was still 鈥渆xtraordinarily pleased鈥� with the progress of Race to the Top grant recipients in general, while he stressed that Hawaii鈥檚 progress was 鈥渘owhere near鈥� where it should be.

鈥淚鈥檓 less concerned about time frames and more concerned about momentum,鈥� he said.

In its Dec. 21 to Hawaii officials, the department said it was placing the state on 鈥渉igh-risk status,鈥� limiting access to its remaining grant money, rejecting several requests for significant changes and delays in its Race to the Top plan, and planning an extensive on-site review early this year. And, in a more overarching statement that put the fate of Hawaii鈥檚 $75 million grant in question, the department said it was 鈥渃oncerned鈥� that Hawaii couldn鈥檛 fulfill the commitments it made to win the grant.

While the federal Education Department in the past has issued warnings to states on other grants, those warnings have usually involved issues such as cash management, not 鈥渦nsatisfactory performance.鈥� Mr. Duncan termed the Hawaii assessment 鈥渉onest,鈥� rather than harsh.

For the department, the tough part of managing such programs is happening now, as it becomes time to hold states accountable for performance, said Vic Klatt, a principal at Penn Hill Group, a Washington-based government-relations and advocacy organization. The same challenge will plague the department when it comes time to enforce promises states are making to win newly offered waivers under the No Child Left Behind Act.

鈥淧eople will make all these grand promises between the two [initiatives],鈥� said Mr. Klatt, a former education aide to Congressional Republicans. 鈥淚t鈥檚 quite the dilemma for the department. I鈥檓 not sure there鈥檚 one state that鈥檚 met its [Race to the Top] commitments so far.鈥�

Ambitious Plans

The 12 Race to the Top winners shared a prize funded by the 2009 federal economic-stimulus package after pitching what outside judges determined were the boldest plans for improving their respective K-12 systems. An additional seven states that were finalists, but not winners, in the original Race to the Top are sharing a smaller, $200 million prize that each will use to implement a morsel of its original plan. That money was provided by the fiscal year 2011 budget passed by Congress, and was awarded last month by the department.

For the original dozen Race to the Top winners, implementation has been plagued by delays and plan adjustments. And although formal progress reports aren鈥檛 out yet, the the department has already approved offers a glimpse of the challenges states are experiencing.

Delaware delayed, at least for a year, using its new teacher evaluations, which are based in part on student achievement, to trigger tenure decisions for teachers. The Education Department in mid-2011 only after requiring additional reporting for the state to ensure it is on track, and after threatening to withhold $13.8 million if the state doesn鈥檛 meet its new timeline.

In November, the department approved a , including more than yearlong delays in completing data-system projects, and several-months-long delays in various teacher-effectiveness plans.

And in New York state, revamping teacher evaluations has become a tangled mess even after state legislators passed a law in 2010鈥攊n hopes of winning a Race to the Top grant鈥攖hat required 40 percent of a teacher鈥檚 rating be based on state and local student tests. Last August, the New York State United Teachers won a partial victory in a first-round court battle, now on appeal, to stop some regulations that would put the law into practice.

Complicating matters further, the New York Education Department last week from 10 school districts after they failed to reach new collective bargaining agreements that incorporate student growth into teacher evaluations.

That development may signal trouble on the horizon for Race to the Top implementation as well. Districts taking part in the Race to the Top program will be expected to adopt similar teacher-evaluation systems once their existing contracts are up for renegotiation.

鈥淚 think they should be very worried鈥� about jeopardizing the state鈥檚 Race to the Top funding, said Charles Barone, the director of federal policy for the Democrats for Education Reform, a New York City-based political action committee that鈥檚 been tracking Race to the Top implementation.

His group, along with several other education groups, sent a to Gov. Andrew M. Cuomo last week urging him to seek legislation to force districts and unions to agree on new teacher-evaluation plans by August or carry out a yet-to-be-determined 鈥渄efault鈥� plan that the state education department would devise.

Although the letter takes unions to task as failing to negotiate in good faith, New York State United Teachers President Richard C. Iannuzzi said the state bears responsibility, too鈥攆or not training principals on how to better evaluate teachers, as just one example.

鈥淲e are not at loggerheads,鈥� Mr. Iannuzzi said in an interview last week, referring to the union and state officials. 鈥淚 think the challenge here is that we have what we believe is a state framework for teacher evaluations that鈥檚 a good framework. But to fill in the pieces of that framework requires a tremendous amount of work.鈥�

New York Commissioner of Education John B. King, Jr. said the state has done its part, adding that some responsibility鈥攊ncluding for efforts like training principals on new evaluations鈥攊s also shared by local school districts. And, he鈥檚 hopeful unions, districts, and the state can still make progress on implementing new teacher evaluations.

Still, he said, 鈥淲e are concerned about being able to fulfill our state Race to the Top objectives.鈥�

Even Gov. Cuomo, in his State of the State speech last week, admitted that the 2010 teacher-evaluation law used to win Race to the Top 鈥渄idn鈥檛 work.鈥�

Hawaii鈥檚 Troubles

Hawaii has experienced perhaps the biggest implementation problems. It failed to secure a crucial collective bargaining agreement with the state teachers鈥� union to implement its teacher-evaluation pilot program, which set off a chain reaction of other delays. Those delays have prompted education policy experts to publicly call for the federal Education Department to revoke Hawaii鈥檚 Race to the Top grant. (鈥淗awaii Scrambles to Deliver on Race to Top,鈥� Dec. 14, 2011.)

Indeed, according to the department鈥檚 Dec. 21 letter, the state has asked to change all projects in its Race to the Top plan鈥攗sually by delaying their implementation.

In an interview last month after the state was placed in the 鈥渉igh risk鈥� category, Hawaii Superintendent of Education Kathryn Matayoshi acknowledged delays and missed milestones. But she added that within the past few months鈥攁s senior staff members at the state education department have come on board to help implement the state鈥檚 plan鈥攖he trajectory and pace have improved. For instance, she said, state officials have begun informal meetings with the teachers鈥� union to begin to hash out Race to the Top issues. She said the state remains committed to its plan.

鈥淲e were hopeful that significant progress [within the past few months] would take us off the radar screen, but apparently that was not the case,鈥� Ms. Matayoshi said. 鈥淲e know that transformation work is hard. ... We want everyone now to step up to this challenge. We need to run a little faster and push a little harder.鈥�

Federal education officials also let the state know how significant it is that officials in Hawaii failed to secure a collective bargaining agreement with the Hawaii State Teachers Association.

鈥淚t is our understanding that without a revised contract, the state cannot fully implement many initiatives in its approved Race to the Top plans,鈥� the federal letter said. From the federal Education Department鈥檚 perspective, the state doesn鈥檛 have the 鈥減roper authority"鈥攅ither in law, regulation, or contract鈥攖o even carry out its plan.

As a high-risk grantee, Hawaii will be able to get its remaining grant funds on a reimbursement basis only, essentially having to ask permission first. During an on-site review, Hawaii officials will be expected to provide 鈥渃lear and compelling evidence that it has made substantial progress.鈥� And the state must submit extensive monthly reports about that progress.

The 鈥渉igh risk鈥� designation eventually could lead to a more severe consequence, which could involve forcing Hawaii to give its remaining award money back. To that end, the state has not spent most of its award鈥攐nly $3.8 million of the $75 million had been drawn down as of Dec. 31. The money would be returned to the U.S. Treasury, federal education officials said.

Revoking a grant is a rare occurrence for the Education Department, but it鈥檚 been done before, most recently when federal officials forced California to give back a $6 million data-systems grant.

鈥淭hey are in danger of losing their resources,鈥� Mr. Duncan said last month. 鈥淭his hasn鈥檛 been a great year for Hawaii.鈥�