Educational agencies accepting federal funds for special programs, particularly under Title I of the Elementary and Secondary Education Act, are often required to prove maintenance of effort. That is, funds generated from state and local sources cannot be decreased and the slack taken up with the federal moneys. The Rand Corporation study reported in this document found that, due primarily to economic and demographic changes, the rate of noncompliance with these requirements has begun to increase and will probably continue to do so. A trend toward tightening the requirements and centralizing the overseeing authority during recent years has made the situation even more difficult. Drawing on documentary data and interviews with officials of the U.S. Office of Education and of state education agencies in 10 states facing compliance problems, the study reveals that a review of the requirements may be in order. The study team offers five alternative policy approaches for consideration: (1) continue to enforce current requirements; (2) grant discretionary waiver authority to the Secretary of Education; (3) return waiver authority to the states; (4) modify the requirements and the penalties for noncompliance; and (5) develop a unified intergovernmental aid policy at the federal level. (Author/PGD)