This report describes the legislative response to state supreme court rulings on rural and small schools and districts. The paper addresses the following questions: How have rural and small schools and school districts been affected by state supreme court rulings and subsequent legislation? What has been the experience of rural and small school districts/schools in regard to school-finance litigation in selected states? and What school-finance issues continue to plague rural and small school districts in states where litigation has occurred? The population for the study consisted of those states, from 1989 on, where the supreme court has ruled on the constitutionality of the education-finance system. Three states were then selected for in-depth study. The report is organized into 4 chapters. Chapter 1 provides the results of the survey of the states. It explains how finance systems have changed and looks at additional funding for rural and small and geographically isolated schools/districts. The chapter also describes the effects on transportation, school consolidation, and resource sharing. Chapter 2 discusses the state of Tennessee, whereas chapters 3 and 4 examine the states of Wisconsin and Vermont, respectively. Each chapter outlines the study methodology and provides an overview of the state, which includes a historical perspective on school funding. (Each chapter contains references.) (RJM)