AFTER AN OVERVIEW OF PROBLEMS ACCOMPANYING THE PRISON POPULATION EXPLOSION OF THE 1970'S, NEW YORK'S SOLUTION IS EXAMINED. THE STATE HAS TAKEN OVER A VARIETY OF ABANDONED FACILITIES, FROM OLD TUBERCULOSIS HOSPITALS, TO ABANDONED DRUG TREATMENT PROGRAM FACILITIES, TO OLD SCHOOLS. THESE HAVE BEEN TURNED INTO MINIMUM AND MEDIUM SECURITY FACILITIES. A NUMBER OF SITES IN NEW YORK CITY HAVE BEEN USED FOR WORK-RELEASE AND STUDY-RELEASE PROGRAMS. THE HISTORY OF THIS MOVEMENT IS GIVEN IN DETAIL. PROBLEMS WERE ENCOUNTERED WITH LOCAL CITIZENS, BUT THE STATE MAINTAINED IT HAD A RIGHT TO USE ITS PROPERTIES IN ANY NECESSARY WAY. TWO CASE HISTORIES ARE EXAMINED IN DETAIL--THE COMMUNITY EFFORT TO TRY TO STOP THE WILTON, N.Y., FACILITY, AND THE OPPOSITION OF A HARLEM NEIGHBORHOOD TO A WORK AND STUDY RELEASE FACILITY. BOTH FACILITIES WERE INSTALLED WITH LITTLE INPUT FROM THE COMMUNITY. THE WILTON MINIMUM SECURITY FACILITY HAS NOT INTERACTED WITH THE COMMUNITY A GREAT DEAL, BUT SEVERAL CRIMES COMMITTED BY INMATES IN THE HARLEM FACILITY HAVE FORCED THE ADMINISTRATOR TO WORK ACTIVELY WITH COMMUNITY LEADERS TO WIN SUPPORT. (ALSO, RULES AT THE HARLEM PROGRAM WERE TIGHTENED CONSIDERABLY.) PLANS FOR A NEW DOWNSTATE FACILITY AND PLANS FOR MORE DIVERSIONARY PROGRAMS ARE ALSO DESCRIBED. THE EFFECTS OF OVERCROWDING ARE BRIEFLY EXAMINED. (GLR)