Across the country, state planners and stakeholders continue to be challenged with ensuring a stable and adequate financing foundation for their Part C early intervention system. Increased enrollment (excluding children at risk) from 2001 to 2004 has been documented for all but nine states and one Territory. Further, the challenges that states face related to implementing the "natural environment" requirements of Part C have placed additional demands at the state and local levels in terms of changes in practice, training and technical assistance needs. With this comes the potential for increased costs due to additional provider time and travel expenses. The difficulty of some states to "keep pace" with the latter demands has affected provider availability and resulted in reduced services for some children, and waiting lists for others. Clearly the financial issues for most states are a considerable challenge. This landscape is further complicated by federal and state budget issues, including the potential for reductions in the federal contributions for key partner resources to most state Part C systems. Clearly, the effective and efficient access to and utilization of a variety of resources are not only required by the federal legislation, but are key to ensuring a viable Part C system. As these challenges to states continue to materialize, nearly all states report more pressure to access the personal resources of families enrolled in early intervention. The focus of this paper is the broad category of family cost participation (FCP), providing a general overview of what is permissible under current federal regulations under a "state system of payments" and how FCP can be structured within this requirement, including a discussion of public policy implications. (Contains 1 figure and 23 footnotes.)