Parents who thought the kids are all right are waking up to dismaying results on state math and English tests for grades 3 through 8. Passing rates dropped 20 to 30 points across Long Island and all over New York. More startling still, this is good news.

How can that be? In reality, the students' performance didn't change all that much. Absent a change in the scoring system, most schools' scores would have inched up slightly. The difference is that state officials have redefined passing grades. The two middle levels in a four-level scale - "meets basic standard" and "meets proficiency standard" - have been bumped several points higher. So, many kids dropped down a level.

Today's scores are the result of an initiative school officials embarked on last year: Admitting that the state assessments had been dumbed down and moving to change that. On the state tests, students had been making steady upward progress, but scores on national exams were flat. Nor were good state scores translating into college readiness.

But while New York has finally stopped cheating on its scores, the State Education Department has yet to come up with what's next. Educators should revamp the tests, yes, but they also need to work with the students who need more help.

Facing up to the state's shortcomings was only the first step. The real test, helping students improve, is ahead. hN