(a) In addition to BEP funds otherwise available under this chapter, there is authorized an additional fund for the purpose of establishing break-the-mold schools, contingent upon federal implementation of such schools. The additional fund shall be subject to annual appropriation and may be supplemented or provided exclusively by federal funds appropriated for this purpose.

(b) Break-the-mold schools shall be public schools established in conformance with any federal program guidelines so as to be eligible to participate in the federal program. In addition, they shall achieve geographical, socioeconomic and urban-rural diversity. Any such school, with local board approval, shall be entitled to all financial and support services available to other schools under the jurisdiction of the local board, including, but not limited to, teacher salary supplements, textbooks, pupil transportation, maintenance and operation; however, the break-the-mold school shall not be subject to the rules and regulations or policies of either the state board or the local board.

(c) Each break-the-mold school shall be approved by the commissioner according to a plan submitted on behalf of the school. This plan shall specify the management and governance of the school, its location, program descriptions, outcome objectives and reporting, admission policies, financial audits, assumption of liability and insurance coverage. The school may be discontinued by the commissioner for failure to meet its approved plan, including pupil performance standards, or for failure to meet generally accepted standards of fiscal management or for violation of law.

(d) The local board shall assist, where it is able, in providing space and facilities either within existing schools or in surplus space or buildings.