Scramble Begins for $650 Million in 'i3' Funding

Nearly 2,500 districts, schools, and nonprofits representing every state have indicated they plan to compete for an Investing in Innovation grant , setting up a furious fight over $650 million in federal economic-stimulus money that’s designed to scale up creative solutions to education’s most vexing problems.

The large group of prospective applicants, which notified the U.S. Department of Education by April 1 that they planned to apply, foreshadows where the stiffest competition will be: for “scale-up” grants of up to $50 million, the largest slices of “i3” aid. Eighty-seven prospective applicants said they would apply for what’s likely to be just five or fewer awards.

And competition will be fierce for the smallest, $5 million “development” grants. More than 1,600 prospective applicants said they want a crack at those; up to...