Project objective for the second year of the Computer Based Project for the Evaluation of Media for the Handicapped was development of a functional system for evaluation. The evaluation system was intended to be neutral to both type of material being evaluated and population of handicapped children. Development of the functional system for evaluation of media was supported by establishment of a data bank of media and student characteristics, inservice teacher training for six persons on principles of instructional technology, discussions and work sessions held with the staff of the Evaluation Unit of the Buffalo Special Education Instructional Materials Centers, and information dissemination activities. Administrative procedures for collecting, analyzing, and storing data have been developed and modified according to needs. Research findings and questions generated included: effects of pretest and posttest design; automated versus nonautomated testing situations; effects of captioning and audio stimuli; and other related investigations. Appended were diagramatic models of the evaluation system. (CB)