The 104th Congress seems intent on reforming the financing of federal programs and, in the process, devolving more authority for the design and delivery of supports and services to states and communities. This paper reviews the experience and lessons from the Reagan block grants of the 1980s, highlighting the similarities and differences between those programs and current block-grant proposals. Also, a number of suggestions for designing social welfare block grants to effectively and equitably address the needs of the nation's children, families, and communities are presented. To sustain support, block grants must clearly define program purposes, goals, and objectives and should protect support for vulnerable populations. Policymakers should consider each state's administrative capabilities, maintain an adequate safety net for state funding, work out the equitable distribution of funds, and remember that flexibility requires adequate funding. Some block-grant funding should be targeted at populations with clearly defined needs, and block grants should protect federal funding for cities. Accountability should be based on an established set of measurable results. Five tables are included. Information about the Finance Project and its resources are included. (Contains 81 endnotes.) (LMI)