The conference convened on June 7, 1981, to study critical issues in rural education, the political and legislative perspectives involved, and resources available for rural educators. The format of the conference consisted of formal addresses and individual discussion sessions. This report includes the formal addresses, covering national implications of the new federal budgetary process: the national perspective on education, particularly rural education; the role of the school/community relationship in rural development; the role of the university in Colorado's future development; federal perspectives on education; political and legislative perspectives; and current issues and events that affect rural education. A brief report from the question and answer session is provided. Concluding the report are discussion summaries which cover staff development issues; the need for innovative models and alternative organizational designs; research issues in rural education; in-service training opportunities; four-day school week experiment; rural teacher training and recruitment in the 1980's; and development of rural education models that work. A list of the conference participants is appended. (CM)