A TWO-PART COMPARATIVE ANALYSIS IS MADE OF LARGE AND SMALL CITY SCHOOL SYSTEMS. PART I ANALYZES A WIDE RANGE OF FISCAL AND NON-FISCAL VARIABLES ASSOCIATED WITH FISCAL STATUS OF CITY SCHOOL SYSTEMS. IT COVERS THE 2,788 CITY SCHOOL DISTRICTS IN THE UNITED STATES WITH ENROLLMENTS OVER 3,000. COMPLEX INTERRELATIONSHIPS SURROUNDING FISCAL STATUS IN COMMUNITY AND GOVERNMENTAL RELATIONSHIPS ARE IDENTIFIED. THE STUDY ALSO IDENTIFIES APPROPRIATE COMBINATIONS OF POLITICAL AND FISCAL CONTROLS FOR DISTRICTS OF VARYING SIZE. THE COMBINATION OF FISCAL INDEPENDENCE, PUBLIC VOTE, AND SCHOOL BOARD ELECTIONS IS FOUND TO BE FAVORABLE FOR ADEQUATE FINANCING. PART II PROBES INTENSIVELY INTO THE FISCAL AND ADMINISTRATIVE OPERATIONS OF SIX LARGE CITY SCHOOL SYSTEMS (BALTIMORE, CHICAGO, DETROIT, NEW YORK, PHILADELPHIA, AND ST. LOUIS) TO IDENTIFY THE CONDITIONING ROLE OF FISCAL STATUS AND TO DEVELOP A DESIGN FOR FURTHER RESEARCH. IT ALSO MEASURES THE OUTPUTS OF INNOVATION AND FLEXIBILITY AS REFLECTIVE OF THE ABILITY OF A SCHOOL SYSTEM TO RESPOND TO CHANGING NEEDS. SERIOUS DOUBTS OF THE SIGNIFICANCE OF FISCAL STATUS AS A DETERMINATIVE FACTOR FOR LARGE SYSTEMS ARISE FROM THIS STUDY, AND SUGGESTIONS ARE MADE FOR AN APPROACH TO FURTHER RESEARCH USING INNOVATION AS AN OUTPUT IN A MODEL WITH ADMINISTRATIVE CHANGE, COMMUNITY PARTICIPATION, AND FISCAL RESOURCES AS INPUTS. (HW)