The Kentucky Educational Improvement Act of 1978 mandated local school districts to initiate two programs: (1) screening and diagnostic test; and (2) development of district educational improvement plans outlining remedial programs or activities. The Comprehensive Tests of Basic Skills (CTBS/S) were selected as the statewide screening instruments in grades 3, 5, 7, and 10 to identify students needing assistance in the basic skill areas of reading, writing, spelling, language arts and mathematics, or in learning skills. Those students identified as deficient in tested skills were to be referred to a state diagnostic testing service. Diagnostic results were to be used to determine the scope of local educational improvement programs. Public hearings were required at each school to assure citizen participation in formulating plans for the local educational improvement programs. (Guidelines for formulating and implementing the program are given. Appendices include a copy of Kentucky House Bill No. 579, a list of expected student outcomes, and specifications for the student identification system). (MH)