MAJOR GOALS OF THE DSO PROGRAM ARE TO DEINSTITUTIONALIZE STATUS OFFENDERS ALTOGETHER AND TO DEVELOP AND UTILIZE COMMUNITY TREATMENT AND REHABILITATION SERVICES. TO BE MEASURED WERE DIRECT BENEFITS TO THE JUVENILE JUSTICE SYSTEM, THE SCHOOL SYSTEM, AND YOUTH INVOLVED. CONSIDERED WERE THE RATES OF RECIDIVISM REDUCTION, LOWERING OF DROP-OUT AND ABSENCE RATES, JUVENILE HALL ATTENDANCE RATES, AND ELIMINATION OF THE 'DELINQUENT' LABEL FOR STATUS OFFENDERS. THIS SECOND YEAR EVALUATION FOCUSED ON CLIENT IMPACT, QUALITY AND NEED FOR SERVICES, AND IMPACT OF SERVICES ON SYSTEM AGENCIES IN THE COMMUNITY. TO ASSESS CLIENT IMPACT, BOTH BEHAVIOR AND ATTITUDE WERE ADDRESSED. CRIMINAL JUSTICE SYSTEM RECORDS WERE EXAMINED, AND CLIENTS COMPLETED EXIT EVALUATION-OF-SERVICES QUESTIONNAIRES. TO ASSESS QUALITY AND NEED OF SERVICES, INTERVIEWS WERE CONDUCTED WITH STAFFS OF SCHOOLS, WELFARE AND MENTAL HEALTH DEPARTMENTS, LAW ENFORCEMENT AGENCIES, AND PROBATION DEPARTMENTS. TO ASSESS IMPACT ON SYSTEM AND NONSYSTEM AGENCIES, PROBATION DEPARTMENT RECORDS FOR STATUS OFFENDERS IN 1975, 1976, AND 1977 WERE EXAMINED, AND JUVENILE HALL AND WELFARE STAFFS WERE QUESTIONED CONCERNING COST CHANGES. DURING THE 2 YEARS THE PROJECT OPERATED UNDER THE LEAA DISCRETIONARY GRANT, 687 CLIENTS RECEIVED SERVICES. THERE WAS STAFF TURNOVER AT BOTH PROJECT SITES, PARTIALLY DUE TO UNCERTAINTY OF INCREASED FUNDING. DETAILED INFORMATION WAS FURNISHED ON 148 CASELOAD CLIENTS, ALTHOUGH INCOMPLETE DATA WERE RECEIVED FROM BOTH SITES. THE MAJORITY OF CASELOAD CLIENTS WERE FEMALE RUNAWAYS, ATTENDING SCHOOL, AND FROM NATURAL PARENT HOMES. THE 260 NONCASELOAD CLIENTS WERE REFERRED FOR A VARIETY OF REASONS. BOTH CASELOAD AND NONCASELOAD CLIENTS WERE DISTINGUISHED BY THE BREADTH OF SERVICES RECEIVED AND NUMBER OF CONTACTS WITH THE PROJECT. DESPITE PROBLEMS, CONTRACTUAL OBLIGATIONS OF THE PROJECT WERE MET. TABULAR DATA, FIGURES, AND APPENDIXES ARE PROVIDED. (LWM)