State education officials are warning that a new federal education law's requirement that each racial and demographic subgroup in a school show annual improvement on standardized tests will result in the majority of the nation's schools being deemed failing.

The likelihood that the law would force them to label the majority of their schools "low performing" is complicating efforts by state educational officials to meet a Jan. 31 deadline for submitting plans for implementing key parts of the federal "No Child Left Behind" law. They say federal regulations outlining how to assess the quality of schools are dangerously arbitrary and inflexible and will result in schools being treated as failures -- even if they are improving by most measures.

"I don't know of any state that isn't facing pretty staggering numbers in terms of schools not meeting" the new law's requirements, said Michael E. Ward, superintendent of schools in North Carolina and president of the Council of Chief State School Officers. "A piece of legislation that we think has very worthy goals risks being undone by its own negative weight."

State officials, most of whom are struggling with deep budget problems, worry that the law will overtax their limited resources by forcing them to channel extra money to schools that may not need it, while causing a public relations nightmare for otherwise improving schools that fall short of the federal government's requirements.

"What happens is you create a situation where there are so many schools failing that there is no support for them," said Paul Houston, executive director of the 14,000-member American Association of School Administrators. "The administration likes to talk about the soft bigotry of low expectations and how this law fights that. But what about the hard bigotry of high expectations without adequate resources?"

Officials have pleaded with the federal government for flexibility, but their requests have been brushed aside by the Education Department, which says the law is written in a way that leaves them no choice. "Only if we hold schools and school districts accountable for the improved achievement of all students will we meet the goal of leaving no child behind," said Education Secretary Roderick R. Paige when he released final regulations for the law in November.

Under the federal law, schools deemed failing for two consecutive years must facilitate student transfers to better schools -- even those filled to capacity -- and use public money to provide private tutors for students. If a school continues to be labeled failing, it must have its principal and teachers replaced or be reopened as a charter school.

President Bush calls the law "the cornerstone" of his administration's domestic policy. Its chief goal is to raise student achievement and close the school performance gap separating white, Asian and middle-class students from under-performing minority and poor students.

The law, which Bush signed last January, requires schools to test students in grades three through eight. Students must make steady progress toward raising achievement levels on the exams, with all students required to reach state-defined proficiency levels in reading and math by 2014.

The problem being cited by many state and local officials is that the law also requires school systems to raise the achievement levels of students in each of five racial and ethnic subgroups, as well as among low-income students, those with limited English skills and disabled students every year. Any deviation from steady improvement in any of the subgroups for two consecutive years results in a school being called low-performing.

Accountability experts say that requirement, coupled with the year-to-year deviations that typically occur in standardized test results, means that schools would often be deemed low-performing for what amounts to statistical -- rather than educational -- reasons.

If two subgroups fail to make sufficient progress in each of two consecutive years -- for example, disabled students one year and low-income students the next -- the Education Department requires that the entire school be labeled low-performing. Also, under the law, two schools with similar test scores can end up with different labels, depending on the patterns of improvement in their scores. If a school, for example, makes dramatic improvement one year, then lags slightly for two more years, it is labeled "low-performing." A school making slow, but steady progress in all subgroups is fine under the law.

"Even in large schools, you are dealing with small numbers of students in some of these subgroups," said Richard K. Hill, executive director of the National Center for the Improvement of Educational Assessment, a consultant for 10 states developing accountability plans. "There is a strong likelihood that a school's scores will go up and down based solely . . . on the performance of just a small handful of students."

That complaint is being registered by states across the country. North Carolina's highly regarded school accountability system is credited with significantly lifting student achievement while showing promising signs of closing racial and economic achievement gaps -- the goals articulated in No Child Left Behind. But the most optimistic estimate is that 60 percent of the state's public schools will be deemed failing once the federal law is fully implemented.

"North Carolina has made some of the best academic progress in the nation," said Ward, the state's schools superintendent. "It is counterintuitive that in a state that has done this that 60 percent of the schools can't meet the federal standard. But we attribute that to a federal formula that doesn't make a lot of sense."

Kentucky officials also are struggling to develop a plan, despite having a school accountability system hailed by experts as among the nation's best. Now, they must make significant changes to accommodate the federal mandates.

"At best, I think the law is an unwarranted intrusion into state and local control of schools," said Bill Weinberg, who quit the Kentucky Board of Education in November in protest of the federal law. "At worst, it is a cynical attempt by the Bush administration to build in failure and use that as an argument for vouchers. "

In Louisiana, education officials are refusing to gut their accountability system -- which has been widely praised for beginning to alter the state's image as an educational backwater -- to satisfy federal demands. In statistical models developed by education officials, as many as 85 percent of Louisiana's public schools would be deemed low-performing under the federal law within three years -- an outcome state officials say does not square with the educational improvement they have witnessed since implementing a state accountability system five years ago.

At New Orleans's Ray Abrams Elementary School, Lauren G. Brown took over as principal two years ago, when its dismal academic performance qualified the school for all the help Louisiana provides under its school accountability program .

New state money allowed Brown to beef up teacher training and bring in a "distinguished educator" to help guide instruction. Three tutors work with students on individual math and reading skills. Students with lagging test scores attend Saturday school. Those who continue to fail go to summer school. And there are transition classes for fourth-graders held back for failing the state test they must pass to go to fifth grade.

The innovations helped Abrams dramatically improve student achievement. And if the scores don't slip this spring, the school will be in line for a $17,000 bonus and the purple-bordered gold flag that Louisiana education officials award to schools exhibiting "exemplary academic growth."

But even while Abrams is on track to be honored for its vast improvement, Louisiana officials worry that the new federal law will pronounce the school a failure. Brown says that would torpedo the growing parent-and-teacher morale at her school. "It would look like we're falling short when we really aren't," she said.

It is a problem that concerns officials across the state. Although Louisiana has the second-highest rate of child poverty and the highest percentage of students enrolled in private school in the nation, its public school test scores have improved sharply in recent years. Not only did 67 percent of the state's elementary schools and 59 percent of its high schools show improvement on state standardized tests administered last spring, but Louisiana also is among those with the nation's best gains on the National Assessment of Educational Progress, a highly regarded national test.

"This law will leave us talking out of both sides of our mouths: saying that schools are doing much better on one hand, but failing on the other," said Leslie Jacobs, a member of the Louisiana Board of Elementary and Secondary Education and chief architect of the state's accountability system. Louisiana officials have met with officials at the Education Department in a fruitless effort to get more flexibility built into the law's implementation.

Gov. Mike Foster (R) confronted Bush on the subject during a recent trip by the president to Louisiana. Still, the federal government has not budged as the deadline for submitting implementation plans approaches. "We are hoping some other states can show us a way to do this without wrecking our accountability system," Jacobs said.

Foster promises not to submit to the law without a fight. "States still have some rights," he said. "I have a lot of friends in Washington. If they don't give us some flexibility in the law, I'll tell you this: We won't go quietly."

Louisiana officials worry that the new federal law will pronounce Ray Abrams Elementary School in New Orleans a failure.Innovations implemented by Principal Lauren G. Brown helped improve student achievement at New Orleans's Ray Abrams Elementary School. Paula Martin teaches her third-grade class at Ray Abrams Elementary School in New Orleans. If scores don't slip this spring, the school will be in line for a $17,000 bonus and the purple-bordered gold flag that Louisiana education officials award to schools exhibiting "exemplary academic growth."