At the request of Congresswoman Edith Green, the Comptroller General of the United States reviewed grant procedures covering two awards made by the Office of Education (OE). The first award, made to the Berkeley Unified School District, was funded under Title VII of the Elementary and Secondary Education Act of 1965, as amended, which provides funds to local educational agencies to develop and carry out demonstration bilingual and bicultural programs. The audit indicated that these funds were used for the development of a national television series although the provisions of Title VII require that grant funds be used only to assist children within a school district and that the Commissioner of Education award such a grant only after determining such a need. A second award was made to Bilingual Children's Television, Inc. (BC/TV), a nonprofit Oakland corporation, under the authority of the Emergency School Aid Act, which authorized OE to provide financial assistance to local educational agencies and public and private nonprofit organizations for special needs incident to the desegregation of elementary and secondary schools. The basic objective of the BC/TV proposal was to develop a bilingual and bicultural (Spanish-English) educational television show to be aired nationally. This award, made by the Commissioner of Education-elect, was granted over strong objections by OE officials after BC/TV's failure to perform under the first grant and management deficiencies disclosed by the Health, Education, and Welfare (HEW) audit agency. The audit agency concluded that BC/TV suffered from delays in funding. (Author/DN)