Nine councils in the housing and council tax administration and ten in the housing maintenance categories will be inspected by teams over the next few weeks.
Under the scheme, winners could gain extra funding for their beacon service.
The Department of the Environment, Transport and the Regions said reductions in the unit costs and involvement with government initiatives on benefit fraud were key criteria in the benefit administration category.
On housing maintenance, demonstrable tenant involvement, comparisons with other councils and "evidence of challenging targets for maintenance costs and reductions in voids" were all key criteria in whittling down the entrants.
The 10 councils nominated for housing maintenance are Bolton, Braintree in Essex, Carrick in Cornwall, York, Derby, Kirklees, Leicester, Manchester, Mendip, and Rochdale.
The nine nominations for housing and council tax benefit administration were Dudley in the West Midlands, Exeter, Leeds, New Forest, Stroud in Gloucestershire and four London boroughs - Camden, Harrow, Lewisham and Redbridge.
However, local authorities took issue with the government over the issue of driving down unit costs in housing benefit administration.
Local Government Association head of housing group Paul Lautman said: "We have slightly raised eyebrows. What we want is value for money but we think authorities need to be spending more on housing benefit administration, not less.
He added: "Local authorities are already spending much less than the Benefits Agency on what is arguably a more complex system."
Public sector union Unison backed the warning, saying jobs would be under threat in the drive to cut costs.
In all some 68 councils of an initial 211 won through. The DETR encouraged the others to submit another bid next year.
DETR plans to announce the final group of about 40 councils in December.
Source
Housing Today
No comments yet