To provide more equitable special education services for blind, deaf, physically handicapped, and autistic children in all parts of Oregon, a funding formula was developed at the direction of the 1981 state legislative assembly. The formula is based on development of a state approved funding level by handicap and by instructional delivery system or student placement. Details of the formula include a standard unit for each instructional placement with an average student/teacher ratio established, based on professional judgments of best practice and checked against actual figures. Among the aspects of funding considered was a revision of the County School Fund billing to allow the local district to be billed directly and funds be provided to regional programs rather than sent to the State General Fund. Discussed are: funding for regional programs for handicapped children; funding formulas in other states and previous funding studies in Oregon; descriptions of the student placement model, standard units, and computer simulations; and instructional placement options. The document contains approximately 30 statistical tables and analyses, including special tables of data on programs for autistic children.