(a) The State Board of Education is empowered to initiate, inspect, approve, and supervise a program of education for children with disabilities as defined in this subchapter.

(b) It is also designated as the agency for cooperation with the state and federal governments, the approved treatment centers, the institutions, and the local schools in carrying out the provisions of this subchapter.

(c) The board shall make the necessary rules and regulations in keeping with the provisions of this subchapter and shall employ the necessary personnel for the proper administration of this subchapter if funds are made available for this purpose.

(d) The board shall have authority to require such reports as it deems advisable so long as the requirements are in keeping with this subchapter.

(e) The board, in keeping with federal requirements, is designated as the agency having general educational supervision over public agencies which provide educational services to children with disabilities as defined in this subchapter to ensure that each public agency complies with state and federal regulations pursuant to the education of children with disabilities.

(f)

(1) The board, in compliance with federal enforcement requirements, is authorized to disallow the generation of all state aid to children with disabilities to any local school district or education service cooperative that fails to comply with state and federal regulations, as determined by independent hearing officers, agency hearing decisions, agency complaint investigation decisions, agency compliance monitoring reports, or agency jurisdictional decisions.

(2) The board is authorized to set aside funds disallowed under this subsection (b) and to utilize such funds for the provision of a free and appropriate public education to appropriate children with disabilities.