This study investigated the impact of the ECIA Chapter 2 Block Grant program and the extent to which the legislative intent was realized in a sample of eight local education agencies (LEAs) in Virginia. Specifically, three research questions were investigated: Did the implementation of ECIA Chapter 2 affect formerly funded categorical programs in the LEAs?; Did the implementation of ECIA Chapter 2 result in the reduction of administrative costs and paperwork burden for the LEAs?; and, Did the implementation of ECIA Chapter 2 provide increased LEA responsibility for the design and implementation of local education programs? The study included data collection at eight Virginia LEAs, Amelia, Arlington, Charlottesville City, King George, Powhatan, Rappahannock, Richmond City and Suffolk City. Administrative, programmatic and fiscal effects associated with ECIA Chapter 2 implementation for the 1982-83 school year were examined with the aid of a semi-structured interview guide. Data were analyzed through the use of the constant comparative method developed by Glaser and Strauss. Data were analyzed across study sites and in case study format. Study findings indicated that the implementation of ECIA Chapter 2 had a detrimental effect on the local programs previously supported with federal categorical program funds. Seventy-six percent of the local programs in study sites were diminished in some way with the implementation of Chapter 2. New local programs supported with Chapter 2 funds in study sites differed from those supported with categorical funds in significant ways. Second, the study found that three study sites experienced reduced administrative costs and paperwork, one experienced no difference, and one-half of the study sites experienced increased administrative costs and paperwork under Chapter 2. Finally, across all study sites, it was found that the implementation of ECIA Chapter 2 did not result in an increase of LEA involvement in program planning and development activities. / Ed. D.