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The system by which New York City students select public high schools has become a process "for weeding out the lowest-achieving youngsters and dumping them in the least desirable schools," a coalition of 24 civic and parents' groups has charged in a report.

Approximately 90 percent of the city's middle-school students apply to one of the city's magnet high schools out of a desire to avoid attending neighborhood schools, which are perceived to be of lower quality, the report by the Educational Priorities Panel found. The average student applied to four such schools.

Nevertheless, 70 percent of the students were denied all of their magnet-school choices and ended up in their neighborhood schools.

As a result, the report concluded, many students end up in schools inappropriate to their backgrounds and interests. Such placements, it said, represent "a sure-fire recipe for 30,000 more dropouts every year."

Inadequate guidance counseling and the poor quality of materials describing the magnet-school programs result "in a complex, little understood, and often secretive process that only the most sophisticated family can negotiate successfully," said Amina Abdur-Rahman, the panel's coordinator, in a prepared statement announcing the release of the report, titled "Lost in the Labyrinth."

"The others are left with a default placement," Ms. Rahman continued. "A disappointed child soon becomes a disaffected one."

The panel recommended that the city appropriate an additional $6.3- million in the coming fiscal year for the improvement of orientation and guidance programs. It also proposed that an additional $10 million be earmarked next year to correct inequities in the city's high-school funding formula.

The Cincinnati Board of Education has approved a "concept paper" on its "Design for School Excellence," a plan to identify merit schools in the 50,000-student district by next October.

The board's concept paper calls for merit schools to be identified according to how well they improve in 10 areas, including student achievement in reading, writing, and mathematics; student and teacher attendance; student, teacher, and parent attitudes toward their schools; interracial understanding; and student discipline.

The program, according to James J. Jacobs, superintendent of the district, is intended to enourage schools to improve their performance in the 10 areas. The board has not yet developed the specific rules for achieving merit status or determined who will judge the schools and what rewards will be offered.

"There is no question that the designations as a merit school will have intrinsic rewards for the schools so honored," according to the board's concept paper. "Extrinsic rewards are also possible."

Schools that do not achieve merit status will be required to develop improvement plans to help them meet the goals. The schools that rate poorly on the 10 indicators may receive additional support services and inservice training.

The merit-school plan supplants a Continued on Following Page Continued from Preceding Page

merit-pay proposal for administrators that was advanced three years ago, but later abandoned, as a way of promoting accountability in individual schools.

Bill Hammonds, president of the Cincinnati Association of School Administrators and Supervisors, which developed the merit-pay plan in 1982, said the group recommended at the time that the district not institute merit pay because of the difficulty of comparing the performance of different schools.

But administrators, he said, do not object to the "Design for School Excellence" plan because schools will be evaluated individually according to how well they achieve certain goals.

A six-day strike by 250 teachers in Chelsea, Mass., ended last week after agreement was reached on a four-year contract that provides for an "unfunded 3-percent increase" in the salary schedule at the end of this school year, a 4-percent salary increase in the fall, and an additional 4-percent increase next spring.

The unfunded increase in the salary schedule is "more of an appeasement than anything else," explained J. Frank Herlihy, superintendent of Chelsea Public Schools. It effectively gives the teachers a 7-percent pay increase in the fall but "technically gave the teachers something this year," he said. The teachers had been working without a contract since last July 1.

The new contract also provides 8-percent salary increases for the teachers in both 1986-87 and 1987-88, a $1.50-increase in the hourly rate for extra duty, and an increase in the substitute-teacher salary from $30 per day to $40.

The strike, which was illegal under Massachusetts law, resulted from "two basic problems," accord-ing to Mr. Herlihy. "The teachers were among the lowest paid in the area, and the city didn't have the money for increases," he said.

Earlier this month, the teachers were found in civil contempt by Superior Court Judge Thomas R. Morse Jr. for failure to obey his order to end the strike. Judge Morse stayed the imposition of a $40,000 fine.

A three-year survey of the equipment used in 10 representative high schools in New York City has found a high level of obsolescence and malfunctioning, according to an audit released this month by the state comptroller's office.

Jon Lukomnik, a spokesman for Comptroller Harrison Goldin's office, said the audit, conducted between 1982 and 1985, showed that 19 percent of the typewriters needed repairs and 14 percent of the microscopes were inoperable.

"So much equipment was broken that teachers needed to rotate typing classes because they didn't have enough operating machines," Mr. Lukomnik said. He said the audit also showed that much of the functional equipment was obsolete.

Some of the microscopes dated back to 1930, he said, and some lathes and other pieces of industrial equipment were 20 or 25 years old.

"Forty-two percent of the typewriters were manual," he added, "even though most businesses have gone to word processors, so in effect they're two generations behind."

Mr. Lukomnik said the report recommended that the board of education establish an in-house repair service for equipment and that funds for "other than personnel services" be increased.

These funds, he explained, average $20 per high-school student and are used for school costs other than salaries. "If you want to repair a microscope, paint a room, or buy a piece of equipment, that comes out of the $20 per student," he said.

Such funds, Mr. Lukomnik pointed out, average $34 per student at the junior-high-school level, "where there is less equipment and less of a need for expensive equipment."

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