Substance abuse is a family disease, which can be transmitted both genetically and by the family environment. Legal and illegal use of alcohol, tobacco, and other drugs (ATOD) can affect children through a number of avenues. In planning for allocation of Proposition 10 funds, the use, abuse, and dependence on ATOD by parents, siblings, relatives, and caretakers raises issues in all three of the primary areas of concern of Proposition 10 funding: 1) Parent Education and Support Services; 2) Child Care and Early Education; and 3) Health and Wellness. This paper proposes that Proposition 10 commissions reviewing their options should bear in mind that both short-term expenditures and longer-range investments can help address the problems of younger children affected by ATOD. In the short range, the biggest data gaps need to be filled so that commissions can have a better idea of which children and parents they are targeting. Longer-term priorities could include ensuring that investments in home visiting and other early intervention efforts include adequate emphasis upon ATOD problems, both in identification of ATOD-related effects and in parent education and support. Longer-term investments should also seek to build the capacity to shift resources over time from less effective to more effective programs, and to move from measuring programs outputs to measuring their outcomes on parents and younger children. Three appendixes contain a literature review and organizational contacts; relevant California experts by county; and options for the use of Prop 10 funds. (GCP)