In February 2000, the Benton Foundation, with the Center for Children and Technology, released "The E-Rate in America: A Tale of Four Cities." This report is a continuation of that work. Two overarching concerns have emerged in the current policy climate: it is imperative that the E-Rate program is structured in such a way as to maximize impact and it is critical to be able to measure a return on the nation's massive educational technology investment. Findings and observations are compiled in this report, with chapters written by experts in the field of educational technology. The first chapter, "E-Rate 102," by Norris Dickard, recounts some of the E-Rate program's growing pains and new policy challenges facing it. In the second chapter, "The E-Rate Takes Hold, but Slowly," Donna Harrington-Lueker reports on lessons that emerged from interviews with administrators, teachers, and technology researchers in the same four cities studied in "The E-Rate in American" (Chicago, Cleveland, Detroit and Milwaukee). In the third chapter, "New Approaches to Assessing Students' Technology-Based Work," Margaret Honey addresses the timely issue of measuring return on investment in a policy climate focused on accountability. The fourth chapter, "Assessment of Students' Technology-Based Work: An Overview of the Toolkit and Case Studies" by Andy Gersick, Constance Kim, Julie Thompson Keane, Wendy Friedman, and Katie Culp, presents case studies in which researchers worked in individual classrooms with teachers in the cities of Chicago and Milwaukee. Together, they developed assessment tools and guidelines to help teachers measure learning gains as students learned to use various information technology tools for research and presentation-compiled into an "evaluation toolkit" (available online and as a supplementary publication to this report). In the last chapter, "Enhancing State and Local Policymaking about Educational Technologies," Chris Dede introduces his "state policy framework" and outlines the need for a more coordinated and systematic approach to policymaking around educational technology. Appendixes present the "State Policy Framework" and outline educational technology evaluation resources. (AEF)