In 1985, the Sears-Roebuck Foundation awarded the American Association of Community and Junior Colleges (AACJC) and the Association of Community College Trustees (ACCT) a 2-year, $950,180 grant, known as the Partnership Development Fund, to enhance collaboration between community, technical, and junior colleges and business/industry/labor, public employers, small businesses, and high schools. This report provides background on the project and summarizes its first-year accomplishments. First, introductory information is provided on AACJC/ACCT's Keeping America Working project, recent federal interest in business/education partnerships, and AACJC/ACCT's joint proposal to the Sears-Roebuck Foundation. Next, the report identifies the project's four partnership development targets and questions to be answered with respect to each. Next, activities funded under the Partnership Development Fund are highlighted, including: (1) awarding 29 partnership development minigrants to colleges; (2) awarding five large planning grants and six smaller grants; (3) giving partnership project awards to Delta College (Michigan), Des Moines Area Community College (Iowa), and Metropolitan Technical Community College (Nebraska) for exemplary and innovative partnership activities; (4) conducting a research and publications program; (5) undertaking a collaborative project with the National Telecommunications Education Committee to help colleges develop relevant curricula for the telecommunications industry; (6) maintaining quality and inventory control; (7) holding conferences and workshops; and (8) fostering education-industry-government relationships. Objectives for the future are presented next, including increases in the numbers of permanent partnerships, improved economic health for small businesses, and expansion of high school/college collaboration and coordination. Next, Sears Partnership Development Fund Minigrant and Planning Fund recipients are listed, and an overview of Minigrant Project objectives is presented. Finally, a financial summary of the project is presented. (EJV)