THE U.S. BUREAU OF PRISONS ESTIMATES THAT UP TO 50 PERCENT OF ADULTS IN FEDERAL AND STATE FACILITIES CANNOT READ OR WRITE. OTHER STUDIES INDICATE THAT AT LEAST 90 PERCENT OF ALL INMATES HAVE NOT COMPLETED HIGH SCHOOL AND THAT THE MAJORITY OF INMATES HAVE LESS THAN AN EIGHTH-GRADE EDUCATION. A 1972 POLICY STATEMENT OF THE BUREAU OF PRISONS ADVOCATES THAT ALL INMATES SHOULD ACHIEVE A MINIMUM SIXTH-GRADE READING LEVEL PRIOR TO RELEASE. THE ADULT EDUCATION ACT, UNDER WHICH MOST PRISON EDUCATION PROGRAMS ARE AT LEAST PARTIALLY FUNDED, DEFINES ITS TARGET AS ADULTS WHO ARE SUBSTANTIALLY IMPAIRED IN OBTAINING EMPLOYMENT COMMENSURATE WITH THEIR ABILITIES. STANDARDS FOR DETERMINING REMEDIAL-EDUCATIONAL NEEDS OF INMATES VARY FROM STATE TO STATE. IN GENERAL, FUNCTIONAL LITERACY AS THE GOAL OF ADULT BASIC EDUCATION (ABE) PROGRAMS INVOLVES SKILLS REQUIRED TO UNDERSTAND NEWSPAPERS, DRIVER INSTRUCTION MANUALS, JOB INSTRUCTIONS, AND INFORMATION NECESSARY TO HANDLE CHECKBOOKS AND TAX RETURNS. AT THE COLORADO STATE PENITENTIARY, THE BASIC EDUCATION PROGRAM IS IN A PERIOD OF TRANSITION. STATISTICS SHOW THAT 67 PERCENT OF INMATES AT THE PENITENTIARY HAVE LESS THAN A HIGH SCHOOL EDUCATION AND THAT 29 PERCENT ARE FUNCTIONALLY ILLITERATE. THE TEXAS DEPARTMENT OF CORRECTIONS REQUIRES THAT ANYONE WHO READS BELOW THE FIFTH-GRADE LEVEL GO TO SCHOOL. SOME MINNESOTA PRISONS USE COMPUTERIZED EDUCATIONAL SYSTEMS, BUT THIS APPROACH IS EXPENSIVE. IN AN EFFORT TO COORDINATE AND IMPROVE EDUCATIONAL SERVICES FOR INMATES, THE STATES OF VIRGINIA, TEXAS, AND NEW JERSEY HAVE PLACED THE MANAGEMENT OF PRISON EDUCATION PROGRAMS IN THE HANDS OF INDEPENDENT STATE AGENCIES OR SCHOOL DISTRICTS. THERE HAS ALSO BEEN AN EFFORT AT THE FEDERAL LEVEL TO UPDATE ABE PROGRAMS AND TO TRAIN TEACHERS FOR THEIR SPECIALIZED TASKS. AT THE FEDERAL CORRECTIONAL CENTER IN LEXINGTON, KY., BASIC EDUCATION CLASSES IN MATHEMATICS, READING, AND ENGLISH ARE OFFERED THREE TIMES A DAY IN COEDUCATIONAL CLASSROOM SETTINGS. THE GREATEST ADVANCE IN ABE, BOTH IN AND OUT OF PRISONS, HAS BEEN IN BASIC READING MATERIALS. ALONG WITH THE USE OF MORE RELEVANT TEXTBOOKS, MANY PRISON SYSTEMS ARE BEING MORE CAREFUL ABOUT HIRING TEACHERS. PHOTOGRAPHS ARE INCLUDED. (DEP)