LANSING (AP) - Fewer teens are being arrested, dropping out of school and having babies, according to a new report that questions whether those trends can continue as more children enter the state's foster care system and leave as adults.

The number of teen arrests and high school dropouts fell by half while the number of teenagers having children fell by nearly one-third between the mid-1990s and 2004, according to the latest Kids Count in Michigan report to be released today.

Jane Zehnder-Merrell, senior research associate for the Lansing-based advocacy group Michigan League for Human Services, said the state has seen improvements among its teenage population. But she is worried there are not enough resources available to older teens leaving the foster care system and juvenile justice facilities.

"It has become a bigger issue because people used to be able to get a job and make a decent living without a high skill level and that's no longer the case," Zehnder-Merrell said in a telephone interview.

Michele Corey, community advocacy director for Michigan's Children, said programs and services set up to support young people leaving foster care or the juvenile justice program have been reduced because tax cuts have curtailed state revenue.

Officials from the Department of Human Services, however, argue that they have increased the emphasis on preparing young people for life after foster care with a number of initiatives, including a voucher worth up to $5,000 a year for college expenses.

The state also has received funding from some nonprofit organizations to offer services to young people leaving foster care, such as classes to teach them how to balance a checkbook, pay rent and get a job, said Mary Chaliman, manager of the foster care program.

More importantly, she said, the department wants to build relationships for young people.

"What we are really trying to drive home is that these youths have a real connection to a person they can turn to for support," Chaliman said. "We want to make sure these kids develop a support system - that can help them with real-life experiences."

Later this month, DHS Director Marianne Udow and Supreme Court Justice Maura Corrigan will be announcing a new statewide task force charged with coming up with ways to put foster children into permanent family situations and help those left in the system transition to adult life.

Since 2002, the state has closed an average 436 foster care cases a year because the individuals involved were between 18 and 21, according to the department's most recent data. At the end of December, there were nearly 19,000 children in Michigan's foster care program.

Zehnder-Merrell, Corey and other advocates for low-income children and families are worried about whether the state will be able to handle an increasing number of children entering the foster care system because of abuse and neglect.

The number of confirmed cases of abuse and neglect increased by 43 percent between the 1994-95 fiscal year and the 2003-04 budget year, going from about 21,160 to 29,740, the Kids Count report said.

"It's very troubling when we look at the mid-1990s versus now and to see an increase in abuse and neglect. It shows we have not been making intervention when we can for our most needy families," Zehnder-Merrell said.

That increase has meant more children placed in care outside their homes.

The number of children removed from their birth families and placed in foster care increased from nearly 18,600 children in the 1995 budget year to 19,800 in the 2004 fiscal year, the report said.

The Department of Human Services will need to bulk up the number of its caseworkers by 20 percent to meet the national recommended standard of 15 cases per worker, Corey said.

DHS workers, however, are seeing their number of cases increase from 19 to 20 under a new order that redistributes cases to cover a few hundred vacancies left open, said Jim Nye, DHS deputy director in charge of field services.