The U.S. Department of Education, which is waving the green flag in its $500 million Race to the Top early learning competition, is telegraphing what it deems to be the most important part of improving early childhood in states: developing a public rating system for those programs.

That category is worth 75 points out of 300, the most of any of the five general criteria states must address as they vie for grants ranging from $50 million to $100 million, according to rules released today by the Education Department, which is working with the U.S. Department of Health and Human Services in running the contest.

Applications, which must be signed by the governor and the leaders of any state agencies applying for a grant involved, are due Oct. 19, and a “handful” of winners will be announced in December. Earlier this summer, 36 states plus the District of Columbia said they were interested in applying. If states win, the rules state that the money can only be used to supplement federal, state, and local funds, and not supplant them.

The overall goal of the competition, said Education Secretary Arne Duncan, is to make sure “many, many more children enter kindergarten ready to succeed.”

And for states to win, he said, “the bar will absolutely be high.” Duncan’s press call started a few minutes late because of the 5.8-magnitude earthquake that shook D.C. minutes before the call was to start. In fact, HHS Secretary Kathleen Sebelius participated in the call from the sidewalk, after her building had been evacuated.

As in the original Race to the Top, Duncan said he has the authority to overrule the outside judges’ decisions in this latest competition. He didn’t use that authority last year when 12 winners shared $4 billion, and he said he doesn’t expect to use it this time, either.

To win Early Learning Challenge grants, Duncan said states will have to adopt standards on what children should know in their early years, implement appropriate assessments for children (perhaps including kindergarten-readiness tests), and develop public ratings systems of early-childhood programs.

Outside judges, who are being recruited by the department, will score the states. In addition to the rating system for early-education programs worth 75 points, the other four criteria are: a state’s early-education track record and capacity to implement its plan (65 points); whether the state has high-quality, statewide standards and appropriate assessments for children (60 points); a state’s plan for setting standards for what early-childhood educators should know and how they are credentialed (40 points); and, whether a state has a kindergarten-readiness test or an early-education data system (40 points).

Included in the 300 point scale are bonus points states can get for having more of their early education programs subject to the rating system, and for having a high-quality kindergarten test in place.

Unlike the earlier, more general Race to the Top competition, where almost half the points were awarded for a state’s education track record, most points in the early-learning competition are reserved for a state’s plan to improve early learning, and not its history in that area.

When the proposed rules came out earlier this summer, many worried that the focus on assessments, or tests, would mean high-stakes decisions would be made about preschoolers and their teachers.

Although the final rules clearly state that the kindergarten readiness tests cannot be used to deny children access to kindergarten, the rules don’t seem to say anything about whether assessments can be used to make high-stakes decisions (such as on job protection, or salaries) about early-childhood educators.

However, said Jacqueline Jones, a senior adviser to Duncan on early learning, “we want to be clear [the assessments are] designed to understand how children are learning,”

What’s more, Duncan said: “We will never ask 3-year-olds to take bubble tests.”

To help states navigate the application maze, the Education Department will host a webinar on Sept. 1 to guide folks and a more intensive video teleconferencing session on Sept. 13.