An essential prerequisite to reform of present methods of financing elementary and secondary schools and the development of an equitable, adequate, and workable system of school finance is a precise understanding of how the existing system works and its impact on different school districts and population groups. This report documents the existing revenue and expenditure patterns in Illinois and examines the fiscal impact of the current system, the nature and extent of disparities among districts, and the factors that contribute to the disparities. An attempt is made to distinguish the degree to which disparities among districts can be attributed to differences in educational resources and services and differences in prices or wages for equivalent services. Wide disparities in per pupil spending in the unit school districts of Illinois are described according to 1970-71 data. The differences are traced back to the State's revenue system and to the dominant role that the local property tax plays in school finance. This role, in turn, necessitates directing attention to the differences in per pupil property value from district to district, which differences are documented by the authors. State support modifies somewhat but fails to eliminate completely the revenue differentials. The authors show how the tax burdens of school support differ for persons of various income levels, with the poor paying relatively higher percentages of their income. Numerous illustrative tables and figures are provided. (Author/DN)