Compensatory education programs funded by Johnson-O'Malley categorical aid monies are described in this annual report on American Indian education in the State of Washington. Funds were allocated to school districts on the basis of need and merit of proposed programs. Programs funded provided food services, home visitors and counselors, teacher and library aides, tutoring, individualized instruction, field trips, and teacher training. Enrollment statistics, a 1968-69 budget analysis, and the 1969-70 budget request are presented. An evaluation report of a conference on American Indian education for teachers, principals, and counselors is also included. (JH)