This report describes the 1994 activities and recommendations of the committee charged with studying the budget, programs, and policies of North Carolina's 12 Smart Start early childhood education and development demonstration projects. Smart Start is a high quality early childhood education and family services initiative involving public and private sector partnerships for children. In 1994, the committee met three times to hear testimony from the state Department of Human Resources, the Secretary of Human Resources, the North Carolina Partnership for Children, Inc. (a public-private corporation that administers the Smart Start programs), 8 of the 12 local Smart Start programs, and 3 local planning committees from counties not selected for Smart Start demonstration projects in 1993. The committee recommended that funding for Smart Start be increased in fiscal year 1994-95, and that 12 additional sites should be selected for demonstration projects. The bulk of this report consists of 12 appendixes, which include copies of the statute that created the committee, the committee roster, a Smart Start program description, legislation and budget figures relevant to the Smart Start program, the mission statement and board membership of the Partnership for Children, and two legislative proposals to expand the Smart Start program in 1994-95. (MDM)