A.__The commissioner shall approve special education costs and supportive services, including transportation, for all state agency clients placed in residential placements by an authorized agent of a state agency.

B.__Special education costs authorized by this subsection for state agency clients must be paid by the department in the allocation year at 100% of actual costs.

C.__The commissioner shall pay only approved special education costs and supportive services, including transportation, authorized by this subsection for state agency clients and may not allocate for those special education costs and supportive services, including transportation, incurred by the school administrative unit for state agency clients in the base years starting July 1, 1985, and every base year thereafter.

D.__Transportation costs for state agency clients, when provided in accordance with rules established by the commissioner under section 7204, must be paid by the department in the allocation year at 100% of actual costs.

2.__Education of institutional residents.__The commissioner may pay tuition to school administrative units or private schools for institutional residents within the limits of the allocation made under this section.

3.__Essential programs and services components contract.__The commissioner may contract for the updating of the essential programs and services component with a statewide education research institute.

4.__Learning results implementation, assessment and accountability.__The commissioner may expend and disburse funds limited to the amount appropriated by the Legislature to carry out the purposes of Public Law 1995, chapter 649, sections 5 and 8.

5.__Regionalization, consolidation and efficiency assistance.__ The commissioner may expend and disburse funds limited to the amount appropriated by the Legislature to carry out the purposes of promoting regionalization, consolidation and efficiency.