In response to proposed reforms designed to replace many federal child welfare programs with block grants to states, this report describes a study of recent trends foster care, resources for foster care and child welfare services, and state responses to current foster care and child welfare service needs. The study reviewed research on foster care and child welfare services and interviewed experts, researchers, and advocates in these fields. The study found that sharp increases in the number of foster children combined with unprecedented service needs between 1983 and 1993 led to a crisis in foster care. Reports of child abuse and neglect nearly doubled, and foster case loads grew by two-thirds during the period. However, resources for child welfare services failed to keep pace with the needs of troubled children and their families. The findings indicate that faced with increasing demands and limited resources, states have sought to preserve families and minimize the need for foster care. Six appendices include information on federal funding to states; proposed child welfare program consolidations; current and proposed foster care standards; and testimonies on child protection, foster care, adoption, and related topics. (MDM)