Any suspension issued pursuant to section 167.161, or this section, or expulsion pursuant to section 167.161, shall not relieve the state or the suspended student’s parents or guardians of their responsibilities to educate the student. School districts are encouraged to provide an in-school suspension system and to search for other acceptable discipline alternatives prior to using suspensions of more than ten days or expelling a student from the school. Each school district or special school district constituting the domicile of any child for whom alternative education programs are provided or procured under this section shall pay toward the per pupil costs for alternative education programs for such child. A school district which is not a special school district shall pay an amount equal to the average sum produced per child by the local tax effort of the district of domicile. A special school district shall pay an amount not to exceed the average sum produced per child by the local tax efforts of the domiciliary districts. When educational services have been provided by the school district or special school district in which a child actually resides, other than the district of domicile, the amounts as provided in subsection 2 of this section* for which the domiciliary school district or special school district is responsible shall be paid by such district directly to the serving district. The school district, or special school district, as the case may be, shall send a written voucher for payment to the regular or special district constituting the domicile of the child served and the domiciliary school district or special school district receiving such voucher shall pay the district providing or procuring the services an amount not to exceed the average sum produced per child by the local tax efforts of the domiciliary districts. In the event the responsible district fails to pay the appropriate amount to the district within ninety days after a voucher is submitted, the state department of elementary and secondary education shall deduct the appropriate amount due from the next payments of any state financial aid due that district and shall pay the same to the appropriate district.

A school district may contract with other political subdivisions, public agencies, not-for-profit organizations, or private agencies for the provision of alternative education services for students whose demonstrated disruptive behavior indicates that they cannot be adequately served in the traditional classroom setting. Such contracting may be included as part of a grant application pursuant to section 167.335 or conducted independent of the provisions of section 167.335.