The Conference sought to provide a user-based and -oriented assessment of performance contracting for education. It focused on delineating the current interest in performance contracting, the technique's demonstrated strengths and weaknesses, and its potential as an alternative approach to school system resource allocation. Six commissioned papers in this report discuss respectively, major problems in performance contracting, the recent Rand-HEW evaluation of performance contracting, measurement and evaluation difficulties, a model for comparing costs of different performance contracting programs, more comprehensive measurement of educational outputs, and employment relations under performance contracting. Discussions of these papers and of administrators' experiences emphasized the many problems of measurement and evaluation that have emerged in performance contracting. The papers and proceedings form the basis for several conclusions, including: (1) evaluations of performance contracting must be based on more than the measurement of student achievement gains; (2) meaningful measurement of student achievement requires multiyear testing of group gains; (3) performance contracting is so innovative that reliable judgments of its utility cannot be made for several years. (Author)