The purpose of the project was to develop a reality-based simulator with training materials as one component of preservice and inservice training programs for persons in leadership positions in public residential institutions for the mentally handicapped. In order to identify the responsibilities and problems of leadership personnel, site visits, consultations, and personal interviews were conducted. The problems identified concerned medical staff, personnel management, department heads, business management, physical plant, patients, community relations, policies and regulations, and nursing staff. A simulated institution was designed from reality based incidents gathered from interviews in state schools and hospitals for the mentally handicapped. The development of preservice and inservice training exercises to implement the simulator was still in the planning stage at the time the report was written. An assessment of the reliability of the simulator through pilot investigations was also planned. A review of literature and a feasibility study conducted at the beginning of the project led the researchers to believe such a simulated program can provide a vehicle for experimentation and research to produce meaningful changes in the management of real institutions for the mentally handicapped. (CD)