It is proposed that federal block grants to Illinois be distributed to school districts according to four characteristics of those districts. Funds will be distributed inversely proportional to property valuation per pupil, directly proportional to percentage of minority children, directly proportional to percentage of poverty children (Title I eligibles), and indirectly proportional to number of children per square mile. A statistical system of weighting is provided to allocate the available pool of federal block grant funds between these four selected district characteristics. The system is based upon the relative power of these four factors to predict operating expenditure per pupil. A computer simulation of the proposed grant was accomplished and some aspects of the impact of the proposed grant are explored. Finally, a short summary outlines both the strengths and the weaknesses of the proposed new distribution method. The proposal assumes that reductions in federal funding should be borne more by the affluent than by the poor. (Author)