There is a growing sense that education policymakers need to become more sensitive to the inequities and inefficiencies associated with the generation of local resources for education, particularly the property tax. The purpose of this book is to provide insight into issues surrounding the generation of local revenues for public education in general and the property tax in particular. Chapter 1 provides an overview of recent trends in revenue sources for public schools, and highlights the growing dependency of local districts on property-tax revenues. The next two chapters examine attributes that should be considered when assessing the merits and shortcomings of a given tax for purposes of financing education. Chapter 2 looks to theories of taxation to uncover the elements that should be present if a tax system is to treat taxpayers fairly or equitably. Chapter 3 expands on these equity notions, and introduces a framework for evaluating the desirability of various education taxes. Chapter 4 examines how the property-tax system operates. Chapter 5 explores alternative property-tax reforms (based on the notion that the property tax is an appropriate mechanism that can be reformed). Chapter 6 proposes that the property tax's shortcomings warrant a shift away from its use, and looks at taxes based on either income or sales and lotteries. Chapter 7 examines the use of nontraditional revenue sources, such as user fees and donations. The final chapter concludes with recommendations for generating local dollars for education. Eighteen tables and an index are included. (Contains 59 references.) (LMI)