This report reviews the use of federal foster care funds under Title IV-E of the Social Security Act for emotionally disturbed and delinquent adolescent boys placed in the Rite of Passage (ROP) program which operates three facilities on Indian land in Nevada. The report indicates: (1) California counties paid about $434,000 in Title IV-E funds for 39 placements claimed as federally eligible as of May 31, 1986; (2) while the program is licensed and is a nonprofit, private institution, the Department of Health and Human Services has not yet determined whether the facility is operated primarily for reasons other than the detention of delinquents; (3) the Indian tribes use California and tribal standards (admission policies, safety, sanitation, and protection of civil rights) to license facilities but do not document inspection for compliance with all their licensing standards; (4) California counties generally meet case review and reunification service requirements; and (5) California monitors its foster care program through the Foster Care Information System, quality control case reviews, audits, and on-site monitoring by counties. Appendices, tables, and figures provide a chronology of investigation of abuses, placements, expenses, licensing history, comparison of personnel files, reasons youth left ROP and subsequent placements, and location of facilities. (NEC)