This paper describes an attempt to develop a teacher instrument for assessing competencies of public school principals and the subsequent "consequence validation" of its scales and items against school mediating and outcome variables. The competency assessment instrument described was one of several developed as part of the comprehensive Georgia Principal Assessment System through Project R.O.M.E. (Results Orented Management in Education). A sample of 1,300 teachers from 35 elementary and 10 secondary schools in Georgia were asked to rate the frequency and effectiveness with which their principals performed on 117 performance indicators. These ratings were then correlated with measures of teacher attitudes toward the school environment, student perceptions of the school environment, student performance on standardized achievement tests, and average daily attendance. Results of the study indicated stronger and more frequent significant relationships between teachers' assessments of principals' behaviors and mediating variables (particularly teacher attitudes as measured by the "school survey" instrument) than between teachers' assessments and school outcome variables (student achievement and school average daily attendance). (Author/JG)