If placement in a public or private residential program is necessary to provide special education and related services to a child with a disability, the program, including non-medical care and room and board, must be at no cost to the parents of the child.

COSTS FOR RESIDENTIAL PLACEMENT

Costs of an approved educationally-based contract for residential placement may be paid from a combination of federal, state, and local funds:

• The local share of the total contract cost for each child is that portion of the local tax effort that exceeds the local educational agency's (LEA) local fund assignment, divided by the average daily attendance (ADA) in the LEA:

• For purposes of this framework, "local tax effort" means the total amount of money generated by taxes imposed for debt service and maintenance and operation less any amounts paid into a tax increment fund under Chapter 311, Tax Code;

• The education cost of residential contracts must be funded with state funds on the same basis as nonpublic day school contract costs:

• If the contract involves a private facility, the state share of the total contract cost is that amount remaining after subtracting the local share; and

• If the contract involves a public facility, the state share is that amount remaining after subtracting the local share from the portion of the contract that involves the costs of instructional and related services;

• State special education funds may be used for transportation only to and from residential placements:

• Prior to using federal funds for transportation costs to and from a residential facility, the LEA must use State or local funds based on actual expenses up to the state transportation maximum for private transportation contracts; and

• After expending any other available funds, the LEA must expend its local tax share per ADA and 25 percent of its Individuals with Disabilities Education Act (IDEA) Part B formula tentative entitlement (or an equivalent amount of state and/or local funds) for related services and residential costs:

• If this is not sufficient to cover all costs of the residential placement, the LEA through the residential application process may receive additional IDEA Part B discretionary funds to pay the balance of the residential contract placement(s) costs; and

• Funds generated by the formula for residential costs must not exceed the daily rate recommended by the Texas Department of Protective and Regulatory Services (TDPRS) for the specific level of care in which the child is placed.

The LEA may contract for a residential placement of a student only with either public or private residential facilities which maintain current and valid licensure by the Texas Department of Mental Health and Mental Retardation, Texas Department of Human Services, Texas Department of Health, TDPRS, or Texas Council on Alcohol and Drug Abuse for the particular disabling condition and age of the student.

The LEA which intends to contract for residential placement of a child for educational purposes with a residential facility to meet some or all of the child's special education needs must notify the Texas Education Agency (TEA) of its intent to contract for the residential placement through the residential application process.

Residential facilities which provide educational services must have their educational programs approved for contracting purposes by the Commissioner of Education.

For out-of-state residential facilities, the facility must be approved by the appropriate agency in the state in which the facility is located, and the LEA must follow the TEA application process.

LEAs that contract for services from non-public day schools must comply with procedures developed by the TEA for monitoring the provision of special education and related services at no cost to the parents in conformance with the individualized education plan (IEP).