Describes the Ninth Circuit Court of Appeals ruling in Rosales v. Thompson (2003) that would make more children eligible for Title IV-E federal foster care assistance. The court determined that certain children who were removed from their homes due to allegations of abuse and neglect and were living with their relatives on an interim basis were eligible for foster care payments under Title IV-E, even though the children would not have been eligible in the homes from which they were removed. The Ninth Circuit disagreed with the “home removal policy” of the U.S. Department of Health and Human Services (HHS) and concluded that eligibility for benefits could be established in any relative’s home in which the child resided during the removal month or six preceding months up to and including the date of the removal petition or the voluntary placement agreement. The Rosales decision applies to states covered by the Ninth Circuit: Alaska, Arizona, Hawaii, Idaho, Montana, Nevada, Oregon, and Washington and granted retroactive relief. Children will now be able to live with relatives who could not afford to take them under the old policy, thus creating more stable placements. Although it is not possible to know the full impact of this case, the effect on children and their caregivers will vary depending on state policies regarding relative caretakers’ eligibility for public foster care benefits. Due to the program’s structure, children must meet Aid to Families with Dependent Children (AFDC) eligibility criteria in order to qualify for Title IV-E benefits. In its 2005 budget request, the Bush Administration proposes to clarify the process for determining eligibility in the foster care program in order to circumvent the Rosales decision by changing the law to conform to HHS policy and thereby continuing to deny federal foster care assistance to children living with relatives.