The Foster Grandparent Program (FGP) focuses on three objectives: (1) To provide low-income elderly persons with an opportunity to participate in their community, (2) To provide financial assistance to low-income elderly persons, and (3) To provide social, psychological, and educational benefits to children with developmental disabilities. Cost-benefit analysis applied to this program was limited to five categories; (1) Federal administrative costs, (2) grantee administrative cost, (3) delegate administrative costs, (4) host institution administrative costs, and (5) project operating costs. Parts of the program that need improvement include: (1) delivery mechanisms and administering agencies, (2) program regulations, and (3) program administration and operation. (CK)