This interim report on the Program Alternatives to Special Education (PASE) program in New York City: (1) describes strategies offered by 32 districts that provide program alternatives to special education referrals; (2) elucidates the strengths and weaknesses of program designs and highlights factors having positive effects on at-risk children; (3) discusses selection procedures for program participation and services designed for children referred to PASE; and (4) reports preliminary analyses of changes in initial school referral rates from 1984-85 to 1985-86. Data gathered from 62 elementary and 19 middle schools visited between December 1985 and March 1986 illustrate such positive program factors as high-quality staff, supportive district and administrative leadership, program designs sensitive to local needs and resources, and focus on the individual child. Program limitations included restrictive selection of target population, exclusion of some elementary schools from the program, staff vacancies, large caseloads, and inadequate staff development. Recommendations involve improved and broadened student selection, improved funding and structure of program administration, more training for and recruitment of staff, and provision of more services (counseling, diagnostic testing, etc.) for PASE students. (CB)