Prentice says student enrolment in Calgary schools is expected to grow by 5,000 students a year for the next seven years.
The money will be used by the Calgary Board of Education to build four starter schools in phases to get students into classes before the entire building is complete.
"These are essentially rapid-response classrooms that are made available to accommodate children more quickly than if we followed a traditional approach of constructing the entire school building first," Prentice said Monday.
"They are a very timely approach to our needs here in Alberta. Starter schools will enable children to attend schools in their own neighbourhoods. It will limit the amount of busing that needs to be done and will allow them to attend schools sooner."
The chair of the Calgary Board of Education welcomed the news.
"We are facing a severe accommodation crunch in our CBE schools. At the moment we believe that we have 80 schools operating at more than 90 per cent of our capacity, which means learning commons and other spaces are being used for classrooms," said Joy Bowen-Eyre.
"In the far north and the south of Calgary we have many more students than we have student spaces for."
Prentice didn't rule out a similar announcement for other regions such as Edmonton.
NDP Leader Brian Mason said the Tories are spending money to address a schooling crisis that the government itself created.
"If proper schools had been planned and built where they were needed and when they were needed, temporary, so-called starter schools would not be required," Mason told reporters in Edmonton.
"This is simply another example of Jim Prentice going back and correcting previous mistakes of his party in government."
The Opposition Wildrose party approved of the government's move, but said much more is needed to address the shortage provincewide.
"I hope these starter schools start easing some of the pressure for Calgary parents, teachers and students who've been waiting patiently for the PCs to deliver on their promise to build 50 new schools and modernize 70 by 2016," said Wildrose education critic Bruce McAllister.
"It's encouraging to see that Mr. Prentice appears to be willing to take some action on the serious lack of schools in Alberta, but this announcement is merely a drop in the bucket compared to what's needed."
The Liberals say the starter schools are just a "band-aid" approach.
"This is hardly 'Building Alberta,'" said Liberal education critic Kent Hehr.
"It is simply a short-term, temporary measure to deflect attention away from the PCs' massive failure to deliver on their promise to build 50 new schools by 2016," he said.
"Our students need real, permanent schools, not trailer park schools."
— With files from Dean Bennett in Edmonton
Follow @BillGraveland on Twitter
Also on HuffPost