THE EVOLUTION OF THE BLOCK GRANT CONCEPT AND ITS FUNDAMENTAL FEATURES ARE DESCRIBED. THE ESSENTIAL CHARACTERISTICS OF THE BLOCK GRANT ARE IDENTIFIED AND COMPARED WITH THE REALITIES OF IMPLEMENTATION. THE FOLLOWING TRAITS HELP TO DIFFERENTIATE BLOCK GRANTS FROM OTHER FORMS OF FEDERAL ASSISTANCE: (1) FEDERAL AID IS AUTHORIZED FOR A WIDE RANGE OF ACTIVITIES WITHIN A BROADLY DEFINED FUNCTIONAL AREA; (2) RECIPIENTS HAVE SUBSTANTIAL DISCRETION IN IDENTIFYING PROBLEMS, DESIGNING PROGRAMS TO DEAL WITH THEM, AND ALLOCATING RESOURCES; (3) ADMINISTRATIVE, FISCAL REPORTING, PLANNING, AND OTHER FEDERALLY IMPOSED REQUIREMENTS ARE KEPT TO THE MINIMUM AMOUNT NECESSARY TO ENSURE THAT NATIONAL GOALS ARE BEING ACCOMPLISHED; (4) FEDERAL AID IS DISTRIBUTED ON THE BASIS OF A STATUTORY FORMULA, WHICH HAS THE EFFECT OF NARROWING FEDERAL ADMINISTRATORS' DISCRETION AND PROVIDING A SENSE OF FISCAL CERTAINTY TO THE RECIPIENTS; AND (5) ELIGIBILITY PROVISIONS ARE STATUTORILY SPECIFIED AND FAVOR GENERAL PURPOSE GOVERNMENTAL UNITS AS RECIPIENTS AND ELECTED OFFICIALS AND ADMINISTRATIVE GENERALISTS AS DECISIONMAKERS. IN ADDITION TO HAVING A NUMBER OF COMMON CHARACTERISTICS, BLOCK GRANTS WERE ESTABLISHED TO ACCOMPLISH SIMILAR BASIC OBJECTIVES. AMONG THE MOST IMPORTANT WERE ECONOMY AND EFFICIENCY, PROGRAM ENLARGEMENT, AND POLICY AND ADMINISTRATIVE DECENTRALIZATION. THE DYNAMICS OF IMPLEMENTATION ARE EXAMINED WITHIN THE CONTEXT OF CASE STUDIES OF TWO OF THE OLDEST BLOCK GRANT PROGRAMS -- THE PARTNERSHIP FOR HEALTH ACT AND THE SAFE STREETS ACT. EACH PROGRAM IS EVALUATED REGARDING ITS FUNCTIONAL SCOPE, RECIPIENT DISCRETION, PROGRAM CONDITIONS, GRANTEE CERTAINTY, AND GENERALIST INVOLVEMENT. THE PRINCIPAL FINDINGS CONCERNING THE BLOCK GRANT EXPERIENCE UNDER THESE ACTS ARE SUMMARIZED, AND THEIR SIGNIFICANCE TO INTERGOVERNMENTAL POLICYMAKERS IS INDICATED, WITH SPECIFIC ATTENTION TO THE BASIC PURPOSE OF SUCH GRANTS, FUNDING THRESHOLDS, TARGETING, DISCRETION, CATEGORIZATION, THE STATES, PLANNING, GENERALISTS, AND TIMING. IT IS CONCLUDED THAT BECAUSE OF ITS DECENTRALIZED THRUST AND ITS RELATIONSHIP TO ECONOMY AND EFFICIENCY, THE BLOCK GRANT WILL HAVE CONSIDERABLE APPEAL TO THOSE SEEKING TO RESTRUCTURE AND RATIONALIZE THE FEDERAL AID SYSTEM. FURTHER, THE HORIZONTAL CONFLICTS BETWEEN THE POLITICAL BRANCHES OF THE NATIONAL GOVERNMENT MUST BE RECONCILED AND THE VERTICAL INTERGOVERNMENTAL TENSIONS MUST BE TREATED SERIOUSLY, OR THE STABILITY OF THIS GRANT DEVICE WILL BE THREATENED AND REFORM EFFORTS ULTIMATELY FAIL. (KBL)