This study of Compensatory Education is divided into four parts: allocation of Title I funds and services, achievement and Compensatory Education, measurement of student growth, and the effects of attrition. Part one examines poverty concentrations to determine which schools and districts are eligible for Title I or for concentration grants. The methods for determining a school's poverty level are also presented. Part two discusses how and how well Title I and Compensatory Education are distributed at the student level. The results of student achievement test scores are compared with teachers' evaluation of students' needs for Compensatory Education. The procedures used in the selection and development of measures of academic growth, achievement, and affective growth are described in part three. Part four describes the reduction in the sample of schools in the second year of the study after funding cutbacks. Also reported is the incidence of student attrition compared over several characteristics including achievement level and minority status. (Author/JCD)