Statements, prepared statements, letters, and supplemental materials are included in this hearing report on legislation to enact a national educational demonstration agreement for school restructuring. The goal of demonstration programs is to improve student performance at the local level with fewer federal state and local restrictions, particularly those involving allocation and funding. Testimonies presented in support of the proposed bill argue that increased local flexibility will improve the quality of and access to special needs population programs. Statements were presented by: Albert Shanker, American Federation of Teachers; Roger Semerad, Nabisco; Thomas M. Kean, Governor of New Jersey; Robert Holland, Committee for Economic Development; G. Alfred Hess, Jr., Chicago (Illinois) Panel on Public School Policy and Finance; and LaVaun Dennett, former Principal, Montlake Elementary School, Seattle (Washington). (LMI)