IN TERMS OF SERVICES RECEIVED, LOCAL SCHOOLS BENEFIT SUBSTANTIALLY FROM EDUCATIONAL BUSINESS MANAGEMENT. IN ORDER TO ISOLATE BUSINESS ADMINISTRATIVE PROBLEMS OF THE SCHOOL SYSTEM, AN ANALYSIS WAS CONDUCTED AT EACH OF 6 ADMINISTRATIVE SERVICE LEVELS--LOCAL (ATTENDANCE LEVEL), DISTRICT, AREA, REGIONAL, STATE, AND MULTI-STATE. AS A RESULT OF MERGED SERVICES, ESPECIALLY AT THE AREA LEVEL, IT WAS CONCLUDED THAT--(1) INCREASED ECONOMY OF OPERATION AND INCREASED SERVICE POTENTIAL RESULTED FROM THE FINANCIAL ABILITY OF LARGER ADMINISTRATIVE UNITS TO ATTRACT MORE HIGHLY SKILLED EMPLOYEES, (2) A MORE UNIFORM SERVICE COUPLED WITH INCREASED COMMUNITY RESPECT AND SUPPORT FOR PROGRAMS EXISTED (PRIMARILY AS A RESULT OF THE INCREASED AREA SERVED), (3) BENEFITS OBTAINED FAR OUTWEIGHED DISADVANTAGES WHICH AROSE WITH RESPECT TO TRANSPORTATION AND COMMUNICATION, AND (4) POOLED RESOURCES, PERSONNEL, AND FACILITIES RESULTED IN INCREASED ECONOMY AND EFFICIENCY. SINCE SIZE IS NOT THE ONLY FACTOR IN ACHIEVING ECONOMY, THE GOAL SHOULD BE THAT SIZE WHERE FURTHER INCREASE WOULD NOT SIGNIFICANTLY IMPROVE EFFICIENCY AND ECONOMY. A MODEL OF SCHOOL BUSINESS ADMINISTRATION SERVICES AT EACH OF THE 6 ADMINISTRATIVE LEVELS IS INCLUDED. (DA)