Perhaps the most ambitious example of the way in which flexibility and accountability have been brought together can be found in the State Flex and Local Flex demonstration programs. Although no additional resources are provided to participating states and districts, the enhanced flexibility granted under State Flex and Local Flex allows participating agencies to consolidate a potentially large body of existing federal funds and to use those funds for any educational purpose authorized by the ESEA. These consolidated funds are intended to support activities that help districts and schools to make adequate yearly progress (AYP). Participants in the State Flex and Local Flex programs are afforded the opportunity to exercise even more extensive flexibility than offered in other NCLB flexibility programs over a set of funding categories similar to those eligible under Transferability. This report focuses specifically on Local Flex--100 percent of formula funds from the following four federal programs may be consolidated: Title II, Part A (Improving Teacher Quality State Grants); Title II, Part D (Educational Technology State Grants); Title IV, Part A (Safe and Drug-Free Schools and Communities); and Title V, Part A (State Grants for Innovative Programs). The U.S. Department of Education commissioned the Urban Institute to conduct a series of interviews with district officials from Seattle Public Schools, the sole district exercising Local Flex. The purpose of these interviews was to investigate Seattle's experiences with Local Flex in order to provide information to other districts considering the option of Local Flex and also to examine the benefits and challenges of the program. While the Seattle Public School District is still in the process of fully implementing Local Flex, the initiative has already changed the way the district focused on strategic planning, helped to deploy resources to the schools and students most in need through expanded programs, and ushered in greater collaboration in the district office and with private schools. Interview Instruments are appended. (Contains 3 exhibits.)