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A model reduction technique based on aggregation with respect to sensor and actuator influence functions rather than modes is presented for large systems of coupled second-order differential equations. Perturbation expressions which can predict the effects of spillover on both the reduced-order plant model and the neglected plant model are derived. For the special case of collocated actuators and sensors, these expressions lead to the derivation of constraints on the controller gains that are, given the validity of the perturbation technique, sufficient to guarantee the stability of the closed-loop system. A case study demonstrates the derivation of stabilizing controllers based on the present technique. The use of control and observation synthesis in modifying the dimension of the reduced-order plant model is also discussed. A numerical example is provided for illustration.