During the 1920's merit pay became the most preferred system of teacher compensation; however, today fewer than 4 percent of the school systems in the United States use merit pay plans. The National Education Association suggests that merit pay is a "bogus issue" obscuring more significant areas of education needing reform, and the American Federation of Teachers has listed a series of preconditions that would have to be met prior to any consideration of merit pay. Declaring merit ratings educationally unsound, the Virginia Board of Education proposed the identification of meritorious schools and the reward of all the teachers in those schools. On the other hand, a national poll of teachers found that two-thirds favor the basic tenets of merit pay, and 61 percent of all respondents in the 15th annual Gallop Poll voted for teacher pay on the basis of quality of work. The factor common to groups opposed to teacher merit pay is the fear of unfair evaluation criteria. In 1963, long before becoming U.S. Secretary of Education, Terrel H. Bell proposed 20 measures for assuring teacher acceptance of merit pay. Among these are establishing an objective system of coded observations of teaching performance and allowing teachers to review their evaluation files. (MLF)