Since the Universal PreKindergarten (UPK) legislation was passed in New York in 1997, the Early Childhood Strategic Group has worked to support full program implementation including providing information to community-based organizations on combining funds from different funding streams to extend UPK services to a full day and to enhance program quality. This report identifies current obstacles to implementation and makes recommendations to ensure that blended funding continues to be a viable option for service expansion. The report describes the benefits of blended funding and how UPK has been incorporated into community-based programs. The report also compares the regulations of relevant agencies, and discusses issues related to: (1) staffing and compensation; (2) teacher compensation; (3) administrative support; (4) facilities; (5) transportation; (6) recruitment of children; (7) accessibility for parents; (8) monitoring and assessment; and (9) systemwide data and analysis. The report concludes with a list of concerns regarding blended funded procedures. The following recommendations are presented as next steps in moving toward the creation of an exemplary early care and education system in New York City: (1) explore a unified rate for UPK; (2) determine real cost of providing a quality program to 4-year-olds; (3) develop a coherent city-wide plan; (4) provide ongoing technical assistance to community providers and school districts on UPK contracting and cost-allocation; (5) conduct research on access to services; (6) conduct research to determine providers capacity to expand; (7) continue to address the teacher shortage; and (8) develop a means to expand classroom facilities. Appended is information on allocating UPK cost in existing programs. (KB)