Chapter 2 Formula provides federal funds to states through the Elementary and Secondary Education Act as amended in 1988. Chapter 2 Formula funds can be used in a variety of ways to meet the educational needs of students at risk of failure or dropping out. In 1994-95, the Austin Independent School District (AISD) (Texas) received a total of $508,208, which included some funds rolled forward from the previous school year. These funds were allocated to the following programs: (1) Academic Decathlon (a scholastic competition); (2) Alternative Calendar (intersession programs for educationally disadvantaged students); (3) library resources; (4) secondary library technology; (5) middle school "Transition In" program to facilitate changing schools; (6) Positive Parenting Practices; (7) prekindergarten supplements; (8) private school materials and resources; (9) Reading Recovery programs for grade 1; (10) the Spanish Academy courses in Spanish for teachers and staff; and (11) supplementary materials for eligible students. Evaluation of each of these areas, as summarized in this report, indicated the general satisfaction of participants and success of the efforts. Some recommendations are made for program continuation. (Contains 2 tables, 11 figures, and 12 references.) (SLD)