IN DECEMBER 1978, IT WAS ALLEGED THAT CHILDREN IN THE CUSTODY OF JUVENILE PROBATION, DEPARTMENT OF ECONOMIC SECURITY (DES), AND THE DEPARTMENT OF CORRECTIONS (DOC) WERE BEING COMMITTED AND ADMITTED TO BOTH PRIVATE AND STATE PSYCHIATRIC HOSPITALS WITHOUT CLEAR STATUTORY GUIDELINES OR ADMINISTRATIVE PROCEDURES. THESE ADMISSIONS WERE REPORTEDLY MOST OFTEN BASED ON THE DISCRETION OF INDIVIDUAL JUDGES, SOCIAL WORKERS, AND THE STAFF INVOLVED. FOR THE PRESENT STUDY, DATA WERE COLLECTED VIA INTERVIEWS WITH JUVENILE JUSTICE SYSTEM AND MENTAL HEALTH INSTITUTION OFFICIALS AND REVIEW OF COURT ORDERS, CASE RECORDS, AND COMPUTER PRINTOUTS ON COSTS AND ADMISSIONS. RESULTS SHOWED THAT THE STATUTORY GUIDELINES ARE UNCLEAR AND PROCEDURAL CONTROLS ARE INADEQUATE. COURTS COMMITTED CHILDREN IN CUSTODY TO PSYCHIATRIC HOSPITALS PRIOR TO OR WITHOUT ADJUDICATION. ADMISSIONS OF YOUTHS AGED 14 TO 18 WERE MADE WITHOUT VOLUNTARY CONSENT OR COURT APPROVAL. ADMISSIONS WERE NOT NECESSARILY REVIEWED BY THE JUVENILE COURT. THE 1979 PARHAM DECISION BY THE SUPREME COURT REQUIRES SPECIFIC MEASURES TO PROVIDE DUE PROCESS. ABOUT 500 YOUTHS IN CUSTODY WERE ADMITTED TO PSYCHIATRIC FACILITIES IN FISCAL YEAR 1978-79. ANNUAL COST OF THEIR CARE IS ALMOST $3 MILLION. SINCE JANUARY 1979, A TASK FORCE HAS BEEN CONSIDERING THE MERITS OF EXPANDING THE YOUTH UNIT OF THE ARIZONA STATE HOSPITAL. LEGISLATIVE OPTIONS FOR STATUTORY ACTION INCLUDE MAINTAINING THE STATUS QUO, CHANGING THE LAWS TO MEET PARHAM REQUIREMENTS, AND MAKING ALL PSYCHIATRIC COMMITMENTS THROUGH INVOLUNTARY PROCEDURES. LEGISLATIVE OPTIONS FOR MENTAL HEALTH PLANNING INCLUDE MAINTAINING THE STATUS QUO, EXPANDING THE STATE HOSPITAL, AND CHANGING THE LAW AND DOING RELATED SERVICE PLANNING. A TABLE, FOOTNOTES, WHICH INCLUDE REFERENCES, AND EXTENSIVE APPENDIXES PRESENTING CORRESPONDENCE FROM AGENCY OFFICIALS AND RELATED INFORMATION ARE INCLUDED. (CFW)