Project Basic is a program developed by the Maryland State Department of Education to assure that students attain basic skills in a variety of areas. Two levels of tests are given in grade 7 to monitor progress, and in grades 9 to 12 to determine whether each student has met the state minimum competency level. Students must pass the higher level of the Maryland Functional Reading Test to be eligible to graduate from high school. There are retest requirements until the test is passed. Graduation requirements apply to handicapped students (mainstreamed or in regular classes) on a different schedule. Test security requires several test forms, therefore test scores have been put on a scale that can correct for differences in difficulty. Scale scores transformed to performance-related scores, and estimated percent-correct scores are used to adjust to the different forms. Scores reported for the total test determine graduation eligibility, and scores for each domain determine areas needing further instruction. The results are reported to students, parents and school staff with pass/fail and performance indications. (CM)