How to adequately fund small schools is becoming a pressing issue in Maine due to numerous factors, including state and federal accountability laws and declining enrollments. The following were among the challenges facing small rural schools: (a) attracting and retaining qualified teachers, (b) attracting and retaining qualified specialty teachers such as music teachers, nurses, science teachers, special education personnel, (c) less visible but increased proportions of students living in poverty, (d) availability of trained special education staff for severe, low-incidence disabilities, and (e) cost of living adjustments that further exacerbate the problem of attracting and retaining high quality teachers. Determining the extent to which these and other potential issues exist in Maine and identifying potential solutions are crucial. Among potential solutions that have been major topics of discussion in Maine are the use of technology and distance education opportunities, participation in regional efforts, and additional funding changes. This paper describes one piece of this complex equation: a funding adjustment for small, geographically isolated schools. (Contains 8 tables and 2 figures.)