(a) In order to secure for the citizens of Connecticut the additional advantages which would accrue from more efficient use of the educational resources of the state, the Board of Regents for Higher Education and the Office of Higher Education are authorized to enter into contracts involving two or more of the public institutions or any combination of public institutions, independent institutions and licensed postsecondary proprietary schools, with participation involving at least two of these sectors, one of which shall be a public institution. Such contracts shall encourage and promote (1) cooperative arrangements for the joint use of facilities, programs and services, (2) development of cooperative academic programs to meet changing societal needs, and (3) improved planning and evaluation processes related to institutional or programmatic consolidations, retrenchment or phase-out. The board and the office may allocate funds appropriated for the purposes of this section to a participating independent institution, public institution, or licensed postsecondary proprietary school. Participating institutions or schools shall be required to contribute a total amount equal to at least twenty-five per cent of the amount of the contract award, provided the participating institutions shall identify the nature and amount of said contribution requirement in the proposal submitted for consideration in accordance with the provisions of this section. Contracting for activities supported by this section shall be for a period of one year. In special circumstances, activities may be eligible for a second year of support if the applicants can demonstrate the feasibility for continuation of the activity from other funding sources beyond the second year.

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(b) For the purposes of this section: (1) A program is defined as a course of study leading to certification, licensure, certificate, or degree at all postsecondary levels; (2) a facility is defined as a building or an area within a building, a group of buildings, a special area, or specialized items of equipment used for educational purposes; (3) a service is defined as a formal activity designed to explore scientific, technological or humanistic problems, to find solutions to contemporary societal problems or to provide selected public service or student service activities; (4) an independent institution is a college or university located in this state which is not included in the Connecticut system of public higher education and whose primary function is other than the preparation of students for religious vocation; and (5) a licensed postsecondary proprietary school is an educational institution so licensed by the Office of Higher Education.

(c) The Board of Regents for Higher Education and Office of Higher Education shall provide continuing evaluation of the effectiveness of such contracts and shall submit on or before February first, annual reports and recommendations to the Governor and the joint standing committee of the General Assembly having cognizance of matters relating to education. In administering this section, the Board of Regents for Higher Education and Office of Higher Education shall develop and use fiscal procedures designed to insure accountability of public funds.