The state has won $400 million in grant money from the U.S. Education Department's "Race to the Top" competition, but that money won't go to reduce class sizes, hire teachers or lengthen the school year - all chronic problems after the state cut $3 billion from schools in the last few years.
Instead, the money will go to pilot a merit pay program for educators, expand a system that tracks students from pre-kindergarten through college, boost graduation rates by thousands of students and revamp the state's math and English standards.
All that comes at a time when many schools can barely afford to keep their lights on or hire teachers for every classroom. And the state is staring down what could be another $1 billion shortfall next fiscal year as federal stimulus money dries up and state tax collections continue to lag.
Still, education leaders in Georgia say it's important that schools not stop work on improving student achievement, even in the face of massive budget shortfalls.
"It is not to come in and be used as a Band-Aid," said state schools Superintendent Brad Bryant.
Just 26 out of 180 school districts signed on to Georgia's application, but that represents more than 40 percent of the students in the state and ranges from Gwinnett County, the state's largest district, to tiny systems with just a few hundred students. Cherokee County School District is one of the 26 school systems that signed on to receive the grant money.
Meanwhile, Georgia will have both a new governor and state schools chief in January, which means new leadership just as the grant money begins trickling into school districts. The Republican candidates in both races have voiced some skepticism about the money, saying it could come with too many ties to the federal government.
But both Democratic candidates are embracing the federal funds. Democratic gubernatorial candidate Roy Barnes said the money is a critical infusion of cash during particularly lean times.
"At a time when teachers are being furloughed and school years are being shortened, this is welcome news for Georgia's public education system," Barnes said.
Republican gubernatorial Nathan Deal has been more ambivalent about the infusion of federal dollars.
He stumbled earlier this month when asked about Race to the Top funds saying first that he would decline the grant money because accepting it would require the state to sign on to a standardized classroom curriculum.
Later, Deal reversed course, saying he was incorrect and that such a curriculum is not a condition of the program. He said he would accept the money but has also voiced some reservations about whether Georgia would be on the hook for the cash once federal funds go away.
"I will work with all stakeholders in education to conduct reviews of this program so that it achieves its original goals and remains an autonomous function of the state of Georgia without federal strings attached," Deal said.
And while the roughly $1 billion price tag on Barnes' education plan has been criticized as too costly in these lean budget times, Deal - who entered the race for governor some 16 months ago - has yet to unveil an education platform. Aides said they expect to do so by Labor Day weekend.
Education spending makes up about half of the Georgia budget.
Georgia joins nine states and Washington, D.C., as winners in the second round of the "Race to the Top" competition. The state came in third in the first round, barely losing out to Tennessee and Delaware, which are sharing $600 million.
The federal competition is aimed at encouraging states to take up bold reforms to improve student learning and narrow the achievement gap.