This report was written at the request of the Latino caucus of the California State Legislature and was completed as the debate surrounding Proposition 227--a measure requiring a substantial cutback in special services to limited-English-proficient (LEP) students in California public schools--was getting underway. The impetus for the report was to rebut arguments that bilingual education had failed. The task of this report is not to present all sides of the issue, but to present the best case in favor of bilingual education. It is concluded that while no single program is best for all children under all circumstances, a well-implemented bilingual program can provide outcomes at least as positive as a well-implemented English-only program, and has the added advantage of potentially providing students with a second language. The report begins with background information on California's K-12 student population and discusses the following issues: how LEP students are served; the status of the LEP teaching force; what is known about how LEP students learn; what is known about the effectiveness of instruction for LEP students; measurement issues; the cost of instruction for LEP students; parent involvement and home influence of LEP students; the current state of assessment of LEP students; and the policy implications of this research. Numerous references are appended. (Contains 40 references.) (KFT)