This paper, the second in an Education Commission of the States (ECS) series, focuses on the planning and financing of dropout prevention programs. Designed as a resource guide, the paper consists of three parts. The first section presents questions asked by policymakers, discusses the process of determining the resources required, and suggests actions to take to ensure a match between programmatic requirements and funding strategies. The second section briefly reviews the range of programs and activities that many states are currently funding to meet the needs of dropouts. The last section draws on recent research and current practice to suggest some approaches that might be used to fund dropout prevention and recovery programs. (SI)