This report uses text, graphs, and tables to show how Vermont's Act 230 (1990) is being implemented to reform both regular and special education. The Act's goals focus on reducing dependence on categorical programs such as special education and increasing support available to students not eligible for special education through such strategies as revision of the special education formula and establishment of a state/local partnership for funding services. Separate sections provide data and analysis on the reform plan, factors impacting significantly on the reform effort (such as the increased demands placed on schools), the impact of reform (e.g., provision of support services to 32 percent of students), the impact on student placement, increasing costs, extraordinary costs for students with intensive needs, the heavy burden on school districts, causes of increased costs (such as increasing needs of students and families), and recommendations. General recommendations are: (1) stemming the trend of increasing student/family needs; (2) building capacity of schools and communities to deal with diverse needs; and (3) developing alternatives for those who need them. More specific recommendations urge more flexible funding, integration of human service workers in the schools, and dissemination of innovative model programs. (DB)