RES-CARE ANNOUNCES NEW DEVELOPMENTS IN CALIFORNIA AND PUERTO RICO.

LOUISVILLE, Ky.--(BUSINESS WIRE)--July 31, 1995--Res-Care, Inc. (Nasdaq/NM:RSCR), a leading provider of residential, training and support services for persons with mental retardation and other developmental disabilities, today announced that it has been awarded grants and received approval for the development of three six-bed intermediate care group homes and a supported living program to serve people with developmental disabilities in northern California. At the request of a California regional center and another provider, Res-Care also recently acquired an additional six-bed group home in the same area.

Res-Care also announced that it has been awarded a $17.4 million contract by the U.S. Department of Labor to continue operating three Job Corps Centers in Puerto Rico. This new two-year contract, which includes three one-year renewal options, was awarded following a formal bid process. Res-Care has continuously managed the three centers since 1990 under a previous contract with the Department of Labor.

The new California group homes, which will be developed with grants from the Golden Gate Regional Center, are scheduled to open before the end of June 1996 in the San Francisco area. On July 24, Res-Care began operating the recently acquired six-bed group home in Redwood City. With the previously announced development of 11 group homes in the surrounding area, by the end of the second quarter in 1996 Res-Care will operate 15 group homes serving 90 individuals in northern California.

Ronald G. Geary, president and chief executive officer of Res-Care, said, "We are pleased that the regional centers in California have invited us to continue expanding our service delivery in northern California. Based on initial conversations with the regional centers, we expect to develop additional services in the next year. The group homes we have added, combined with the four larger facilities we recently acquired from Beverly Enterprises in the Los Angeles area, have allowed us to establish a strong presence in the state."

With the new Puerto Rico award, Res-Care will continue to operate three Job Corps centers in Garrochales, Barranquitas and Ramey, Puerto Rico. These three centers have consistently ranked in the top 10% of Job Corps Centers nationwide.

"We are excited that the Department of Labor has entrusted us with the continued management of its Puerto Rico Job Corps Centers," commented Geary. "By successfully operating these centers for the past five years, Res-Care has established a reputation as an effective bilingual Job Corps contractor. We are proud of our ability to serve a diverse group of students, and we look forward to maintaining the excellent reputation these centers have achieved."

Now in its 21st year in operation, Res-Care serves approximately 4,000 individuals with mental retardation and other developmental disabilities through approximately 260 facilities and programs in 13 states. The Company also serves 1,900 disadvantaged youth in seven Job Corp centers located in three states and Puerto Rico. Res-Care employs approximately 7,000 people in 15 states and Puerto Rico.

CONTACT: Res-Care, Inc., Louisville

Halsey Sandford, 502/491-3464