In order to provide federal policymakers with an adequate background of information on the issues of vocational education and private sector (VEPS) cooperation, an analysis was made of the context of current VEPS cooperative practices. The analysis revealed that although the concept of cooperation is simple and appealing, it is very difficult to implement. Several factors appeared to undermine the effectiveness of cooperative activities. Included among these were the following: the existence of current cooperative practices that are described as fragmented, duplicative, and ad hoc; the use of volunteerism as the basis for cooperation; and the lack of available funds for vocational education linkage activities. When these factors are coupled with other underlying issues (such as the infringement of the private sector in the training enterprise, delineation of who should bear the cost of training, and the perceived inability of vocational educators to respond quickly to technological changes), the dire need for policy initiatives in this area becomes evident. Based on an analysis of these issues, four policy options were set forth that gave rise to 28 policy alternatives. These alternatives were then limited to 12 possible policy alternatives. (Appended to this report are a sample listing of VEPS cooperating practices and an initial evaluation of 28 policy options.) (MN)