This part of the School Management Handbook provides elementary school administrators with an overview of the issues involved in complying with the requirements of Public Law 94-142, the Education for All Handicapped Children Act. The first section of the document discusses the law's background, the federal funding the law provides, which children are covered, and what schools and school districts must do in compliance. Describing the individualized education programs mandated by state and federal law for all handicapped students, the second section of the document touches on the program's content, its form, procedures for its preparation, and the role of parents in the program. Section 3 discusses the rights of parents in the handling of their handicapped children, including the right to be notified of changes in their children's educational programs and the right to an adequate hearing process if they do not find their children's educational programs acceptable. All three sections include specific recommendations for school policy regarding the treatment of handicapped students. (PGD)