D.C. School Superintendent Arlene Ackerman plans to revise a tough new principal evaluation system that, in its original form, would have resulted in most of the city's nearly 150 principals receiving "unsatisfactory" or "needs improvement" ratings for the school year that ended last month.

Ackerman is meeting with principals to discuss evaluations and "trying to resolve [the issue] as quickly as possible," schools spokeswoman Denise Tann said yesterday. The superintendent also needs to hire about 20 principals by fall to fill vacancies created by retirements and a few promotions.

A mechanism to weed out poor principals is crucial to Ackerman's effort to improve the long-struggling D.C. school system. But many educators and school watchdogs are wary of the evaluation process she developed last year, which did not allow principals to be rated "satisfactory" unless their schools' standardized test scores improved by specific, often ambitious, margins in four of six categories.

Under the original evaluation system, principals and schools got no credit if student test scores improved but fell short of the school's goal. Because standardized test results counted for 35 percent of the evaluation and a score below 70 percent would result in a rating of "unsatisfactory," critics said the plan doomed many principals.

"It's alarming that it's such a narrow measure," said Kathy Riley, a longtime parent advocate who last year founded the Senior High School Alliance of Parents, Principals and Educators. She praised Ackerman's decision to reconsider.

The superintendent sent a June 29 letter to principals saying that because the majority of schools did not meet their "benchmark targets," she would give the equivalent of partial credit to those principals whose test scores showed more modest improvement.

The school system has released preliminary data from the tests taken in the spring. The figures show a decline of one to two percentage points in the proportion of youngsters scoring at the lowest level.

Ackerman also will weigh each principal's rating from the 1997-98 school year and whether principals scored high marks in other areas, such as financial management, school atmosphere and parent involvement, said the letter, a copy of which was obtained by The Washington Post.

"There are ways to recognize the growth and still hold [principals] accountable," she said in the letter. "My job is to find a way to do both."

Schools that met most or all of their test-score targets will receive cash bonuses ranging from $3,750 to $15,000. Ackerman said she would name those schools after she completes her review of evaluations. Schools that did not meet their targets have until Sept. 3 to submit an improvement plan, Ackerman said.

CAPTION: D.C. School Superintendent Arlene Ackerman is discussing the evaluations with school principals.