The failure to implement a more rigorous teacher-evaluation system is about to cost the city school system a bundle.

The state Education Department will soon award up to $25 million in “Performance Improvement Grants” to some 20 school districts. But the city will be shut out because of an impasse with the teachers union over putting in place a new evaluation system that rates educators in part on how their students fare on standardized exams.

“I don’t see how New York City can qualify,” a state education official said.

Gov. Cuomo proposed two competitive challenge grants as part of his education program: one for performance or academic improvement, and another for management efficiency.

For the management grant, school districts get 20 bonus points for having a new teacher evaluation in place. The Education Department expects to award those grants in late October.

But a city Education Department official said, “In addition to the important benefit that a new citywide evaluation system will have for our students and teachers, there are many grants that we will be eligible for with a new evaluation agreement. We are optimistic that we will reach a deal by the deadline.” Cuomo has tied a total of $800 million in additional state education funding to school districts having new evaluation plans in place by January. School districts that fail to deliver a plan lose their share of the funding.