A special education teacher and an administrator in each of 17 small rural public school districts in New Mexico were interviewed to identify problems with and strategies for providing special education services in the districts. According to teachers, the most severe problems involved acquiring appropriate equipment and materials, recruiting related services staff, and staff development. Administrators thought staff recruitment was the most severe problem followed by compliance with state education regulations and staff development. Most districts also reported a failure to provide for special education students aged 18-21 but school finances and transportation were not significant problems for the districts. Respondents suggested strategies in the areas of staff recruitment (contacting college placement centers and professional acquaintances), staff development and retention (sponsoring release time and teacher attendance at conferences and workshops), and finance (involving private professionals and services). Researchers offered general recommendations related to the Division of Special Education's assuming a leadership role in problem solving, the establishment of regional resource centers, the district use of joint powers of agreement for service provision, and the evaluation of the present weighted formula funding system. They also offered 20 specific recommendations for improving services to exceptional children and suggested research directions. (SB)