The Safe and Drug Free School and Communities Act of 1994 authorizes funding at federal, state, and local levels for school-based drug-and violence-prevention programs. This General Accounting Office (GAO) report reviews the following: (1) accountability measures required at the federal, state, and local levels (by the act); (2) activities used by the Department of Education for overseeing state and local programs; (3) how state education agencies ensure local programs' compliance with the act; and (4) how Safe and Drug-Free Schools funding is specifically used at the state and local levels. The GAO reviewed federal and state-education-agency documents; reviewed allegations of impropriety in three states (Michigan, Virginia, and West Virginia); interviewed state and local officials involved in the alleged impropriety and its investigation and resolution; and surveyed 50 states, the District of Columbia, and Puerto Rico about their activities. The four major types of accountability mechanisms include: an application process; the monitoring of activities by state agencies; periodic reports and evaluations; and the use of local or substate regional advisory councils. The Department of Education oversees state programs directly and local programs indirectly through required state actions. To date, no overall evaluations of the Safe and Drug-Free Schools program have been completed. Nearly all states use the approved local plans as the primary means for helping to ensure local programs' compliance with the act's requirements. State and local education agencies use Safe and Drug-Free Schools funds for a variety of activities. Appendices contain site-visit reports, information on methodology, data on Safe and Drug-Free Schools and Communities programs, GAO contacts, and staff acknowledgements. Contains nine tables and three figures. (LMI)