An estimated 11 percent of American children live with at least one parent who abuses or is addicted to alcohol and/or drugs. Parental addiction is a significant factor in child abuse and neglect, with studies suggesting that 40 to 80 percent of families in the child welfare systems are affected by it. With appropriate treatment, many of these parents would be able to achieve recovery and take care of their children physically, emotionally, and financially. But treatment services--especially services that allow women to take their children into treatment with them--are relatively scarce. The Adoption and Safe Families Act of 1997 (ASFA) created new challenges for these families and for the systems serving them. ASFA's time limits on reunification services for families and an accelerated permanency planning process have increased the challenges facing families and the child welfare and treatment systems. The purpose of this report is to examine policy and practice issues affecting these systems and their clients. Specifically, this report: provides background on the problem of addiction in the child welfare system; discusses ASFA and its implications for families at risk for involvement or involved in the child welfare system because of parental addiction; presents case studies of how two localities are addressing addiction in their child welfare systems; and presents a model for addressing addiction among families involved in the child welfare system based on these case study findings. (Contains 32 references.) (GCP)