SECTION 5C. Zero interest loan program for extraordinary and unanticipated special education costs

(a) There is hereby established a zero interest loan program for extraordinary and unanticipated special education costs, to be administered by the department. The board of education shall promulgate regulations necessary for the operation of this program.

(b) Local and regional school districts may elect to apply to the loan program by vote of the school committee.

(c) The state comptroller shall establish on the books of the commonwealth a special education loan program trust fund. Any amounts appropriated for the purposes of this program shall be transferred into said trust fund.

(d) Any funds remaining in the trust fund at the end of a fiscal year shall be carried forward into the following fiscal year and shall remain available for expenditure without further appropriation.

(e) Districts may apply for zero interest loans to cover any portion of the amount by which the current year's total special education expenses are expected to exceed 110 per cent of the district's average total special education expenses of the prior three years. For the purposes of this section, total special education expenses shall include instructional costs, private school tuition costs and premiums paid to the risk pool trust fund established in section 5B, but shall not include transportation costs. Loan applications shall be subject to review and approval by the commissioner. Approved loan amounts shall be paid from the trust fund established in subsection (c).

(f) The commissioner may make such adjustments as are necessary to loan applications to account for reimbursements received under any other state or federal programs.

(g) Loans shall be repaid over a five-year period according to a schedule to be established through department regulations. At the direction of the commissioner, loan repayments due from participating districts shall be deducted from said district's quarterly local aid distributions and deposited in said trust fund.

(h) Commonwealth charter schools may participate in the program in the same manner as local and regional school districts provided that any payments due to the trust fund may be deducted from tuition payments otherwise to be deducted from district quarterly local aid distributions pursuant to subsection (nn) of section 89 of chapter 71. Said payments shall be deposited in said trust fund.

(i) A reasonable amount of administrative costs may be expended annually from the trust fund for the administration of the program.