California, which lost out on the first round of controversial federal Race to the Top education grants, emerged as a finalist in its second try, officials announced Tuesday.

"Today's development means we are still in the hunt," said state Supt. of Public Instruction Jack O'Connell.

The finalists are the District of Columbia and 18 states, including New York, Florida, Massachusetts, Louisiana, Colorado, Arizona and Hawaii. Winners will share $3.4 billion in funding and will be announced in September.