An ideal system of the National Assessment of Educational Progress (NAEP), from the local school district perspective, must follow several principles based on the 1985 Standards for Educational and Psychological Testing: (1) Testing must be viewed by teachers and students as worthwhile. (2) Test results must be presented in a timely and useful fashion. (3) Testing at national, state, and local levels should not be redundant. (4) Measurement should not disrupt normal classroom activities and attendance. (5) Reports should focus on factors over which the instructional leaders have some true control. (6) Tests should measure only curriculum outcomes which are being taught or which, it is agreed, should be taught. The ideal system would link national, state, and commercially available item banks. For each of the basic skill areas, five components would be included: (1) national learning objectives, (2) national public domain item banks, (3) a linking measurement scale, (4) a test development system, and (5) a testing or data collection system. The appendices, which constitute the greater part of the document, discuss federal government-school district relationships, data collection and decision-making plans, Oregon's school district profile, and an extensive presentation of the Portland (Oregon) School District's development of calibrated item banks ("A Regional and Local Item Response Theory Based Test Item Bank System," by Hathaway, Houser, and Kingsbury). (GDC)