(a) In accordance with subdivision 1 of section 6302 and subdivision 2 of section 6305 of the Education Law, a community college may provide educational services beyond its sponsorship area, which may be included in the operating budget for State financial assistance purposes, provided that:

1. (1) such services are provided for a contracting local entity or entities who elect to participate in the operations of an existing community college. A contracting local entity shall be defined as:

   1. (i) a county which does not sponsor a community college or have located within its geographic boundary a State University agricultural and technical college or College of Technology; or
   2. (ii) any city, intermediate school district or school district within such a county; and
2. (2) the provision of such educational services is defined in an agreement between the board of trustees of the community college and a contracting local entity or entities, as duly authorized by appropriate local law, resolution, order or ordinance of the local sponsor of the college and the contracting local entity;
3. (3) in cases where services are provided by more than one community college, said agreement shall delineate each college's region of operation and programmatic responsibilities in order to avoid unwarranted duplication of services.

(b) A contracting local entity shall pay an appropriate share of the expense involved in the local sponsor's community college program where students who attend the program reside within the jurisdiction of the contracting local entity.

1. (1) The appropriate share with respect to operating costs shall be determined on the basis of the operating chargeback rate on an FTE student basis established for the community college.
2. (2) This chargeback share is applicable to all approved credit courses taken by students approved by the college, regardless of age or current educational status.
3. (3) The appropriate share with respect to capital costs shall be determined on the basis of the capital chargeback rate established for the community college. Capital costs shall be paid by the contracting local entity only in the event that capital costs are generated solely as a result of the program provided by the community college.
4. (4) When students reside outside of the areas of both the sponsor and the contracting local entity, the allocable portion to be paid by the county of residence for operating and capital costs shall be the amount established for the residents of the contracting local entity and paid to the college.