Well-financed and appropriately organized school districts are essential if rural education is to be improved. Since all 3 levels of government (local, state, and Federal) participate in providing revenues for rural education, coordination among them is necessary. In many states, the local property tax still provides a major portion of educational funding. In such states, property tax administration is of prime importance, since a poorly administered system limits the availability of revenues. In much of rural America, therefore, property tax reform is a matter of some urgency. If rural students are to be provided with an education appropriate for life in modern society, the quality of their schooling should not be based on local tax-paying ability. Considering the states' responsibility for the support of education, movement toward full state funding is recommended. Statewide planning is also needed to ensure that revenues provided by the state are used effectively. State leadership in the planning activities of local and regional authorities is an important element in the development of improved rural educational systems. Federal categorical support of programs designed to improve rural education should be continued. Within this complex financial and organizational system, the rural educator plays the key role. Therefore, administrators and school board members in rural communities should be provided with financial and technical assistance to permit them to meet the needs of their students. (KM)