This report on the Emergency School Aid Act (ESAA) identifies several problems concerning the act and its administration. It has been found that some program funds have been used for general educational rather than desegregation assistance because the administration allowed funding of school districts with planned desegregation efforts which were completed years ago. Funds have also gone to school districts that were not desegregating, and to schools which were not affected by the districts' desegregation plans. In addition, activities not directly related or necessary to implementing a desegregation plan have been supported. Further, regulations governing establishment or maintenance of integrated schools don't insure that such schools differ significantly from others within a district. Schools with the greatest need for desegregation assistance might not be awarded funds because: (1) state allotments required by the act can preclude funding of local educational agencies most in need of desegregation assistance nationwide, (2) the grant award criteria used may not adequately consider the criteria specified by the act, and (3) the Office of Education's grant award criteria have several problems which might preclude funds from going to the most needy schools and students. This report contains recommendations made to the Department of Health, Education and Welfare. In addition, it is recommended that Congress do the following: (1) clarify whether local educational agencies can be eligible for program funds if planned desegregation efforts were completed years ago, (2) clarify the act's definition of integrated schools if the criteria for determining the proportion of nonminority enrollment in integrated schools do not achieve the purpose of that provision of the act, and (3) modify the way in which funds are apportioned under the act so that local educational agencies most in need of desegregation assistance are funded. (Author/AM)