N.Y. Education Law § 4405: Computing financial responsibility for special educational services for certain children with disabilities

§ 4405. Computing financial responsibility for special educational

services for certain children with disabilities. 1. Maintenance for

children with disabilities in residential schools under the provisions

of this article or state schools under the provisions of articles

eighty-seven and eighty-eight of this chapter.

a. Maintenance for a student with a disability placed in a residential

school under the provisions of this article shall be a charge upon the

social services district wherein such child resides at the time of the

commencement of the school year for which aid is to be paid. Financial

responsibility for the maintenance of a student with a disability placed

in a state school under the provisions of articles eighty-seven and

eighty-eight of this chapter shall be in accordance with the provisions

of such articles.

c. Expenditures made by a social services district for the maintenance

of a child with a disability placed in a residential school under the

provisions of this article, including a child with a disability placed

by a school district committee on special education pursuant to this

article in a special act school district, or a state school subject to

the provisions of articles eighty-seven and eighty-eight of this

chapter, shall be subject to reimbursement by the child's school

district of residence pursuant to the provisions of subdivision ten of

section one hundred fifty-three of the social services law. The amount

of such reimbursement shall be a charge upon such school district of

residence.

2. Transportation expense. The transportation expense of each child

with a disability shall be aidable in accordance with subdivision seven

of section thirty-six hundred two of this chapter; provided, however,

that for the school year commencing July first, nineteen hundred

seventy-six, school districts shall be apportioned ninety per centum of

the estimated amount of its approved costs of such year for the

transportation of children with disabilities whose transportation was

formerly provided under a family court order and is now a charge upon

the school district, subject to the adjustment of any errors after the

actual costs are ascertained.

3. Computing state financial responsibility for operating expenses for

certain children with disabilities.

a. In addition to any other apportionments under the provisions of

this chapter, there shall be apportioned to each applicable school

district for each child with a disability in attendance in a state

school under the provisions of paragraph d of subdivision two of section

forty-four hundred one of this article or an approved program under the

provisions of paragraphs e, f, g, h, i and l of such subdivision two,

the product of such attendance, computed in accordance with regulations

of the commissioner, and the excess cost aid: an amount computed by

multiplying the excess cost, as defined in subdivision six of section

forty-four hundred one of this article by the excess cost aid ratio

defined in subdivision seven of this section.

b. In addition to the apportionment provided to a school district

pursuant to paragraph a of this subdivision for the attendance of a

child with a disability in a state school under the provisions of

paragraph d of subdivision two of section forty-four hundred one of this

article, for each such child in attendance in such school prior to July

first, nineteen hundred ninety, there shall be apportioned an additional

amount. Such amount shall equal the product of the taper aidable cost

multiplied by the taper aid ratio. The taper aidable cost shall equal

the positive remainder resulting when (i) the apportionment attributable

to such child pursuant to paragraph a of this subdivision is subtracted

from (ii) the product of such child's attendance and the tuition for the

state school such child attends. The taper aid ratio shall equal the

quotient, computed to three decimals without rounding, resulting when

the positive remainder of one minus the combined wealth ratio, as

defined in subdivision three of section thirty-six hundred two of this

chapter is divided by seventy-five one-hundredths. Such aid ratio shall

not be less than zero nor more than one.

c. The apportionments to each school district pursuant to this

subdivision shall be based on excess cost paid and attendance during the

base year.

d. Notwithstanding sections thirty-six hundred seven and thirty-six

hundred nine-a of this chapter, apportionments pursuant to this

subdivision shall be paid to school districts upon submission of reports

of attendance and approved tuition expenditures filed in a format

prescribed by the commissioner and shall be paid from the annual

apportionment of public moneys for the support of public schools in

accordance with section thirty-six hundred nine-b of this chapter.

4. a. The commissioner of education and the commissioner of social

services shall develop reimbursement methodologies for the tuition and

maintenance components of approved private schools and special act

school districts. The commissioner of education, in consultation with

the appropriate state agencies and departments, shall have

responsibility for developing a reimbursement methodology for tuition

which shall be based upon appropriate educational standards promulgated

pursuant to regulations of the commissioner of education. The

commissioner of social services, in consultation with appropriate state

agencies and departments, shall have responsibility for developing a

reimbursement methodology for maintenance, pursuant to section three

hundred ninety-eight-a of the social services law and the regulations

promulgated thereunder.

b. The commissioner of education shall develop reimbursement

methodologies for the tuition components and, in consultation with the

commissioner of social services, the maintenance components of the New

York state school for the blind and the New York state school for the

deaf based upon appropriate standards promulgated pursuant to

regulations of the commissioner of education.

c. The director of the budget, in consultation with the commissioner

of education, the commissioner of social services, and any other state

agency or other source the director may deem appropriate, shall approve

reimbursement methodologies for tuition and for maintenance. Any

modification in the approved reimbursement methodologies shall be

subject to the approval of the director of the budget. Notwithstanding

any other provision of law, rule or regulation to the contrary, tuition

rates established for the nineteen hundred ninety-five--ninety-six

school year shall exclude the two percent cost of living adjustment

authorized in rates established for the nineteen hundred

ninety-four--ninety-five school year.

d. Effective upon final approval by the director of the budget of the

reimbursement methodologies for both tuition and maintenance, the

commissioner of education shall annually determine a tuition rate in

conformance with this paragraph for each private school and special act

school district.

e. Effective upon final approval by the director of the budget of the

reimbursement methodologies for both tuition and maintenance, the

commissioner of social services shall annually determine a maintenance

rate and a medical services rate, in accordance with this paragraph, for

each private school and special act school district where applicable.

f. Effective upon final approval by the director of the budget of the

reimbursement methodologies for both tuition and maintenance, the

commissioner of education shall annually determine a tuition rate and,

in consultation with the commissioner of social services, a maintenance

rate and a medical services rate, if applicable, in conformance with

this subdivision for the New York state school for the blind and the New

York state school for the deaf.

g. All reimbursement rates determined pursuant to this subdivision

shall be effective for the period July first through June thirtieth.

Rates for the following year shall be submitted no later than April

fifteenth to the director of the budget. The director shall act upon

such rates within forty-five days of submission. Such rates shall not

become effective until approved by the director of the budget. In the

event that the rates are approved after July first, then such rates

shall be deemed to apply retroactively to such date.

h. All reimbursements shall be subject to adjustment and final

determination upon field audit conducted by the education department,

the department of social services, the state comptroller or any agent

thereof.

i. The commissioner of education, the commissioner of social services

and the director of the budget, in consultation with other appropriate

state agencies and departments, shall enter into an interagency

agreement to assure effective implementation of the provisions of this

paragraph. The agreement shall provide for, but not be limited to, the

development of common accounting practices and audit procedures, common

information and budget forms, coordinated financial and other reporting

requirements for private schools and special act school districts,

mechanisms for resolving appeals of rates established pursuant to this

section, and mechanisms to evaluate and recommend modification to

reimbursement methodologies.

j. (i) If the board of education of a special act school district

listed in chapter five hundred sixty-six of the laws of nineteen hundred

sixty-seven, as amended, seeks to close a special act school district,

the board of education of the special act school district shall provide

written notice to the commissioner with a plan for closure of the school

at least ninety days prior to the closing date. Such plan shall include

provision for the safe and orderly transfer of each student with a

disability who was publicly placed in the program and a detailed and

itemized list of estimated expenses necessary to close down the school

and a detailed and itemized list of any estimated revenues to be

received.

(ii) During the close-down period and until all necessary financial

obligations of the school district have been met pursuant to this

paragraph, the commissioner shall require the board of education of the

school district to periodically submit, as required by the commissioner,

financial reports and financial statements, detailing any tuition,

and/or close-down costs and any revenues generated. In applying the

reimbursement methodology to any remaining tuition costs and any other

reasonable and appropriate expenses needed to close-down the special act

school district, the commissioner shall reject any close-down costs that

are unnecessary or unreasonable to close-down the school, whether or not

the board of education submits a close-down plan.

k. (i) The tuition methodology established pursuant to this

subdivision for the two thousand twenty-one--two thousand twenty-two

school year shall authorize approved private residential or

non-residential schools for the education of students with disabilities

that are located within the state, and special act school districts to

retain funds in excess of their allowable and reimbursable costs

incurred for services and programs provided to school-age students. The

amount of funds that may be annually retained shall not exceed one

percent of the school's or school district's total allowable and

reimbursable costs for services and programs provided to school-age

students for the school year from which the funds are to be retained;

provided that the total accumulated balance that may be retained shall

not exceed four percent of such total costs for such school year; and

provided further that such funds shall not be recoverable on

reconciliation of tuition rates, and shall be separate from and in

addition to any other authorization to retain surplus funds on

reconciliation.

(ii) The tuition methodology established pursuant to this subdivision

for the two thousand twenty-two--two thousand twenty-three school year

and annually thereafter shall authorize approved providers to retain

funds in excess of their allowable and reimbursable costs incurred for

services and programs provided to school-age and preschool students. The

amount of funds that may be annually retained shall not exceed the

allowable surplus percentage of the approved provider's total allowable

and reimbursable costs for services and programs provided to school-age

and preschool students for the school year from which the funds are to

be retained, as defined in subparagraph (iii) of this paragraph;

provided that such funds shall not be recoverable on reconciliation of

tuition rates and provided further that any interest earned or

investments realized on such funds shall supplement and not supplant any

funds provided by the tuition methodology once retained. For purposes of

this subparagraph, "approved providers" shall mean private residential

or non-residential schools for the education of students with

disabilities that are located within the state, special act school

districts, and programs approved pursuant to section forty-four hundred

ten of this article that are subject to tuition rate reconciliation.

(iii) The approved surplus percentage shall be as follows: eleven

percent for the two thousand twenty-two--two thousand twenty-three

through two thousand twenty-four--two thousand twenty-five school years,

eight percent for the two thousand twenty-five--two thousand twenty-six

school year, five percent for the two thousand twenty-six--two thousand

twenty-seven school year, and two percent for the two thousand

twenty-seven--two thousand twenty-eight school year and annually

thereafter.

(iv) Funds authorized to be retained under this paragraph may be

expended only pursuant to an authorization of the governing board of the

school, school district or program approved pursuant to section

forty-four hundred ten of this article, for a purpose expressly

authorized as part of the approved tuition methodology for the year in

which the funds are to be expended, provided that funds may be expended

to pay prior year outstanding debts. Any school, school district, or

program approved pursuant to section forty-four hundred ten of this

article that retains funds pursuant to this paragraph shall be required

to annually report a statement of the total balance of any such retained

funds, the amount, if any, retained in the prior school year, the

amount, if any, dispersed in the prior school year, and any additional

information requested by the department as part of the financial reports

that are required to be annually submitted to the department.

5. The commissioner shall annually determine the tuition rate and the

commissioner of social services shall annually determine the maintenance

rate for special services or programs provided during the months of July

and August for children with disabilities entitled to attend public

schools without the payment of tuition pursuant to section thirty-two

hundred two of this chapter. The commissioner of education shall

annually determine the tuition rate, maintenance rate and the medical

services rate, if applicable, for such children attending the New York

state school for the blind or the New York state school for the deaf

during the months of July and August. Such rates shall be determined in

conformance with the reimbursement methodologies established pursuant to

subdivision four of this section and shall be subject to the approval of

the division of the budget. Rates shall be determined for all special

services or programs as defined in section forty-four hundred one of

this chapter and offered during July and August.

6. Tuition and maintenance rates established pursuant to this section,

once certified by the director of the budget, shall be used in all

contracts for the provision of programs and services for which such

rates were established, provided, however, that the commissioner shall

prorate the amount to be paid for an individual pupil enrolled for a

period of time which is less than the full period of time approved for

such program or services.