From the 1920s through the 1950s, most states used average daily attendance (ADA) in state equalization plans. Beginning in the middle of the 1950s, many states began to use average daily membership (ADM) in such plans. The essential features of any equalization aid plan are (1) a measure of need (such as ADA or ADM), (2) a measure of wealth or capacity, (3) the amount of unit per need that constitutes the foundation program, and (4) the uniform rate to be applied to the measure of capacity. A good measure of need in a foundation program must be objective, not subject to local manipulation, unambiguous, and simple. It must have commonsense appeal, be steady rather than fluctuating, and adequately reflect the differences between controllable and noncontrollable elements. Because ADM is complex, is subject to local manipulation, and lacks commonsense appeal, ADA seems best to meet the criteria if the ADA is based on actual classroom records of students present rather than on mere subtraction of students absent. On the other hand, the argument that the use of ADA encourages attendance has not been proved to be true. Its use also punishes both affluent suburbs and low socioeconomic cities and rural areas where attendance is poor. (Author/JM)