Described in this document are the minimum competency requirements that Arizona students must master before they can leave third grade. These requirements were mandated by the K-3 Improvement Plan first implemented in the 1986-87 school year. The first section of the document, which discusses revision of the K-3 skills list, covers background information, the revision committee, the comittee's work, hearings and district responses, and coordination with the Language Arts Essential Skills Committee. Remaining sections contain the text of the law that established the K-3 Improvement Program, program guidelines, an explanation of the philosophy of the program, and listings of third grade essential/exit skills in the subject areas of: (1) social studies; (2) science; (3) music; (4) health; (5) mathematics; (6) visual arts; and (7) language arts skills. The revised language arts essential skills section discusses how the revision can be used and how listings were revised. Discussion of the latter topic covers the revision committee's work, how current knowledge about language arts was used by the committee, and the format of the language arts essential skills. Sixteen references are appended. Appended also are the detailed formats for the language arts essential skills as well as lists of outcome criteria for these skills. (SKC)