The federal monitor overseeing improvements at the Jersey Division of Child Protection and Permanency, which used to be DYFS, has issued a new report that finds progress is being made - but there are still big problems.

Judith Meltzer, of the Center for the Study of Social Policy, says more adoptions are taking place, and health care has been improved for kids under state care, but there are also concerns about a drop in caseload compliance.

Alison Blake, the Commissioner of the New Jersey Department of Children and Families, says it appears the Penn State child abuse sex scandal caused a strain on the system - and the result was a drop in caseload compliance.

"We had been making a lot of progress, but the really incredible uptick in referrals to the hotline and then the subsequent assignments to the field really set us off kilter…We went through a period of several months right after the Penn State case broke where our numbers were 30-40 percent higher than they had been historically during those months…But we seem to be right-sizing the data for the last two months indicates things are returning to normal -our caseloads are getting manageable again."

She says this isn't really surprising because "when there is a very high profile child abuse case or child sexual abuse case there is, it draws a lot of attention. It heightens the public's awareness."

Blake adds another concern is that the Department got $37.5 million less than expected.

"At the last minute, there were additional reductions to the funding for our child protection work, and also for community services in the behavioral health system," she said, "That was a little surprising…We heard that was based on trend data but we've not seen that data and these were not issues that were raised with us during the Legislative hearings and so we were really taken aback."

Says the cuts are a concern.

"We need to be able to maintain manageable caseloads, and that means that we have to have adequate staffing and that means we have to be able to pay the staff…We're concerned about it, but we're watching it closely - the Governor's office is very supportive…We're going to take this month by month - it's very early in the fiscal year for me to say it's a problem."