In 1985 and 1986, 24 and 37 schools respectively, were publicly recognized as merit schools under the Design for School Excellence (DSE) program of the Cincinnati (Ohio) Public School system. The increase in merit schools was not accompanied by a large increase in the number of awards made on individual indicators. Rather, the new merit schools tended to be schools which were near the merit cutoffs in 1985 and improved somewhat in 1986. The largest improvements at the elementary and secondary levels were generally noted for those indicators which focused on the internal accountability system that preceded the DSE. After two years, results showed that merely designating an outcome as an indicator of merit did not automatically guarantee improved performance. The award of merit for gain, or improvement, has not performed as intended in planning for the DSE. Lower performing schools did not consistently have the largest gain. The gain measures have not been biased, but their advantage in performance has been insufficient to produce many merit schools on gain alone. It was concluded that it is premature to ascribe any performance changes, positive or negative, to the DSE, since changes could have occurred with or without this public recognition. Further evaluation was recommended. (Some questionnaire items are appended as are 10 data tables.) (KSA)