(a) The board of school directors of every school district or joint school shall, for the purpose of designating the schools to be attended by the several pupils in the district or area served by the joint board, subdivide the district or joint school in such manner that all the pupils in the district shall be assigned to, and reasonably accommodated in, one of the public schools in the district or joint school. The board of school directors may, upon cause shown, permit any pupil or pupils in any school district to attend such other school in the district as the board may deem proper, or may classify and assign the pupils in the district to any school or schools therein as it may deem best, in order to properly educate them. Whenever any child or children of compulsory school age have their residence more than two (2) miles by the nearest public highway from the school within the district to which they have been assigned, and free transportation for such child or children to a school within the district is not provided, and there is a school in session in some other district in the Commonwealth within two (2) miles by the nearest public highway of the residence of such child or children, the board of school directors shall, with the consent of the board of school directors of such other district, reassign such child or children to such school in the other district, and shall pay to said district the tuition charge provided for by this act. This provision shall include in like manner assignment to high schools in the case of pupils of compulsory school age who are qualified to be enrolled in such high schools. It shall be unlawful for any school directors, superintendent, or teacher to make any distinction whatever, on account of, or by reason of, the race or color of any pupil or scholar who may be in attendance upon, or seeking admission to, any public school maintained wholly or in part under the school laws of the Commonwealth.

(b) Notwithstanding anything to the contrary stated within this law, the board of school directors of any school district, in which a day treatment program operated under approval from the Department of Public Welfare¹ by a private children and youth agency is located, may in its discretion purchase educational services for children referred, pursuant to a proceeding under 42 Pa.C.S. Ch. 63 (relating to juvenile matters), to such an agency. Before the board of school directors purchases educational services from the agency for a specific child, it must document that the child cannot receive appropriate educational services in a regular classroom setting because of behavioral or psychological reasons: Provided, however, that nothing contained in this section shall be construed to alter or limit the educational rights of exceptional children.

(c) The actual cost, not to exceed the tuition charges of the school district in which such day treatment program is located, shall be borne by the school district of the child's residence. If the school district of residence of the child cannot be determined, the costs shall be borne by the Department of Education. The department shall effectuate necessary procedures for the transfer of funds from the school district of residence to the school district in which the day treatment program is located. In effectuating the transfer of funds, the department may deduct the appropriate amount from the basic instructional subsidy of any school district which had resident students who were provided educational services by an approved children and youth agency.

(d) For the purpose of this section, educational services shall be defined as direct expenditures for instruction and the administration of the instructional program. Any expenditure not pertaining directly to instruction and the administration of the instructional program of the students shall be considered a cost of child welfare services as provided for in sections 704.1 and 704.2, act of June 13, 1967 (P.L. 31, No. 21), known as the “Public Welfare Code,”² and as a social service as defined in the regulations promulgated pursuant to that act. Under no circumstances shall a school district or the Department of Education be required to provide funding for programs operated in excess of one hundred eighty (180) days of instruction or nine hundred (900) hours of instruction at the elementary level or nine hundred ninety (990) hours of instruction at the secondary level during any one school year.