Section 12. The department shall establish and maintain a school department for school-age children in each institution under the control of the departments of mental health, developmental services, public health and youth services which provides support and care for resident children with a disability, acting jointly with the department which has control over the particular institution; provided, however, that appropriations for the administration of said school departments shall be administered by the department of education.

Each such school department shall be administered by a director, appointed jointly by the commissioner of education and the superintendent of said institution.

Each such school department shall have such staff as the department and the department which administers the institution involved deem appropriate.

Such school departments shall operate pursuant to regulations established jointly by the department and the department which administers said institution. Nothing contained herein shall affect the continued authority of departments operating such institutions over all non-educational programs and all treatment for residents or patients in institutions under their control.

The director and staff of such school departments shall be employees of the department of education, which shall assume the costs of all aspects of the educational programs in such departments. Said school departments may operate twelve months of the year. Nothing contained herein shall operate to remove from employment any educational personnel already employed by any institution now under the administration of the department of mental health, developmental services, public health or youth services, or to reduce their salaries or other employee benefits.

The per capita expenditure on education programs in such school departments shall be equivalent to or higher than the average expenditure for special education programs in the public schools of the commonwealth less the average transportation costs. Said average expenditure shall be computed annually by the department of education.

The city, town or regional school district in which each school-age child in any institution described in this section would normally be eligible to attend school and the city, town, or regional school district in which each day student admitted to an institution under the control of the department of public health and receiving educational services from the department of education would normally be eligible to attend school shall pay to the commonwealth the costs of the education of that child in the school department of that institution in an amount determined according to the regulations issued under section 10. The payment for each such child shall not be less than its average per pupil cost for pupils of comparable age within the city, town or regional school district. The amount due the commonwealth each year shall be deducted from the annual distribution to said city, town or regional school district pursuant to section 20 of chapter 59.