This document presents a proposal for a two-tiered community service and youth employment program. The first chapter presents youth employment data, describes the need for a work-education and community investment strategy, and discusses the proposal's underlying philosophical and economic ideas. Chapter II reviews four categories of successful work and service programs that provide examples for developing policy: (1) work experience and cooperative education; (2) remedial education and training; (3) pre-employment assistance; and (4) private sector placement activities. Chapter III presents a model of the two tiers of the proposed project, each of which would serve different goals: (1) the Community Service Corps would involve young adults who want to spend a year in transitional community service that tests their skills and encourages them to explore new interests; and (2) the Stay-in-School Program would offer training, support services and work opportunities to economically disadvantaged youths who are still in high school or have dropped out. Chapter IV briefly outlines the general principles upon which this model's delivery system options were based. The document ends with a short discussion of principles for a national community service and youth employment policy, and with a list of organizational and individual endorsements. (KH)