THE EFFECTS OF A 1962 NEW YORK STATE AID TO EDUCATION ACT WERE INVESTIGATED IN RELATION TO AN OLD FOUNDATION PROGRAM. THIS STATE AID TO EDUCATION ACT WAS BASED ON THE CONCEPT OF SHARED COST. BOTH NEW AND OLD PROGRAMS WERE APPRAISED WITH RESPECT TO THE OBJECTIVES OF SCHOOL FISCAL POLICY--EQUITY OF SUPPORT (EQUAL TREATMENT OF EQUALS), EQUALIZATION OF SUPPORT, AND TAX RELIEF. THE FINDINGS INDICATED THAT (1) EQUITY OF OPERATING SUPPORT REMAINED ABOUT THE SAME WHILE EQUITY OF BUILDING SUPPORT IMPROVED, (2) THE PROCESS OF EQUALIZATION AND TAX-BROADENING RELIEF IMPROVED, AND (3) RELATIVE EMPHASIS UPON EQUALIZATION INCREASED IN OPERATING SUPPORT AND DECREASED IN BUILDING SUPPORT. THESE FINDINGS LED TO THE FOLLOWING RECOMMENDATIONS FOR CHANGES IN POLICY DEVELOPMENT AND IMPLEMENTATION--(1) DESCRIBE THE OPERATING SUPPORT CEILING IN LAW AS A CENTRAL TENDENCY OF OPERATING EXPENSE LEVELS, (2) DESCRIBE IN LAW A MEANS BY WHICH ALL DISTRICTS RAPIDLY AND WITHOUT UNDUE EFFORT CAN ACHIEVE THE BASIC SUPPORT LEVEL, (3) ELIMINATE SIZE CORRECTIONS, GROWTH AID, AND FLAT GRANT AID, AND (4) FURTHER EXAMINE THE COMPARATIVE EFFICACY OF AID TECHNIQUES IN ACCOMPLISHING TAX-BROADENING RELIEF. (HW)