In 1989, an Illinois Community College Board committee examined the issue of cost effectiveness among the state's community colleges. The individual cost categories examined for the study included direct salary, direct department, direct equipment, building rental, operation and maintenance, academic administration and planning, learning resources, student services, administrative data processing, general administration, and general institutional costs. In addition, the net instructional, full instructional, and total institutional costs were analyzed. All cost analysis for the study was done on a statewide level rather than on a district level, and all costs were adjusted for inflation. Study findings included the following: (1) after adjusting for inflation, unit cost expenditures showed very limited growth between 1980 and 1989, with direct salary, department, and equipment costs actually lower in 1989 than in 1980; (2) operation and maintenance costs, learning resources costs, general administration, and general institutional costs reflected a rising trend; (3) salary costs on a per unit basis declined from $35.20 in 1980 to $31.43 in 1989, while departmental unit costs decreased in real terms from $7.34 to $6.30 in real terms; and (4) in 1980, the real cost per credit hour of instruction was $85.12, and, in 1989, the figure was $82.30. The data suggest that the community colleges in Illinois have operated in a very cost-effective manner during the past 10 years, with the most significant cost increases being attributable to cost factors over which institutions have little control. (JMC)