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December 12, 1983

T. G. and P. G., Individually, and on Behalf of Their Infant Child, "D. G.", Plaintiffs,

The opinion of the court was delivered by: ACKERMAN

 This matter arises under the Education For All Handicapped Children Act, 20 U.S.C. § 1401 et seq. (the Act). Plaintiff D. G. is an eleven-year old boy who was classified as emotionally disturbed by the Child Study Team (CST) of the defendant Board of Education of Piscataway (Board). D. G. and his parents T. G. and P. G. commenced this action on November 22, 1982, seeking to have the defendant Board pay the principal charges plus any interest due and owing to the defendant Community Mental Health Center of the Rutgers Medical School for "psychotherapy" services allegedly provided as part of plaintiff D. G.'s Individualized Education Plan (IEP) developed by the CST. The defendant Community Mental Health Center has counterclaimed for the amount due and owing, cross-claimed for same against the defendant Board, and impleaded the Prudential Insurance Company of America, Blue Cross of New Jersey, and Blue Shield of New Jersey, all of whom are plaintiff T. G.'s health insurance carriers. This matter is presently before me on motions for summary judgment brought by plaintiffs, defendant Board of Education, and by third-party defendants Prudential Insurance Company of America, Blue Cross of New Jersey and Blue Shield of New Jersey.

 Rule 56 of the Federal Rules of Civil Procedure provides that summary judgment is not to be granted unless, after all reasonable inferences have been drawn in favor of the non-moving party, there remains no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. See DeLong Corp. v. Raymond International, 622 F.2d 1135 (3d Cir. 1980). With this standard in mind, I turn first to consider plaintiffs' motion for summary judgment. For the reasons which follow, I have determined to grant plaintiffs' motion.

 The undisputed facts relevant to this motion are as follows: Pursuant to the requirements of the Act, the Child Study Team of the defendant Board carefully evaluated plaintiff D. G.'s condition and as a result classified him as emotionally disturbed. Following discussion with D. G.'s parents, the CST recommended that D. G. be placed in a therapeutic environment in order to maximize the benefits he would receive. Specifically, the Child Study Team's IEP recommended that D. G. "be provided with a totally therapeutic environment in a special education day school for the Emotionally Disturbed that will provide him with the controls and individual attention necessary for his social and emotional development. This is viewed as the least restrictive environment to meet his needs." It was agreed upon between the defendant Board and D. G.'s parents that the child would be placed in the Child Day Hospital of the Community Mental health Center of the Rutgers Medical School, University of Medicine and Dentistry of New Jersey. This placement commenced on September 30, 1980.

 The Child Day Hospital is a specialized treatment program for seriously emotionally impaired children. As such, the Hospital provides, in its own words, "individual child psychotherapy, family therapy, and a broad spectrum of milieu therapy on an integrated, intensive basis." Educational services are also provided in an effort to enhance learning by each of the children involved while they are in therapy. When D. G.'s parents placed him in the Child Day Hospital, they were told that the program required without exception that every child participate in the "therapeutic treatment" portion of the day program.

 D. G. remained at the Hospital until January 20, 1983, when, due to the success of the Hospital's program, he was able to return to his local school. The program at the Hospital had consisted of individual child psychotherapy two days a week, family therapy with the parents, and with or without the child, weekly or as indicated, mileau therapy on a daily basis, including therapeutic activity group, individual and group counseling and behavior modification, as well as special education on a daily basis in self-contained and departmentalized classes.

 On October 24, 1980, plaintiffs T. G. and P. G. were informed by the Community Mental Health Center that the psychotherapy provided to D. G. as part of the Hospital's program would be assessed to them, and not to the school district, and that it would be charged at a rate of $45.00 per day. The Center has to date received no payments for these charges, which at the time of D. G.'s discharge had grown to a total of $25,200.00.

 In 1982 the parents sought to have the Board take responsibility for the cost of the psychotherapy. The Board refused to do so, giving the parents three reasons for its decision. First, it suggested that psychotherapy was not part of the IEP agreed to by both the Board and the parents. Second, it pointed to the fact that the New Jersey Department of Education had issued a policy statement to the effect that "psychotherapy" other than that necessary for diagnostic and evaluative purposes, was not a "related service" for which a local school district would be responsible under the mandate of the Act. Finally, the defendant Board took the position that nothing else in the Act or its implementing regulations required it to pay for this service. Plaintiffs then as now responded that psychotherapy is a "related service" within the meaning of the Act, and that in any event it was an integral and, in fact, required part of the Independent Education Program agreed upon by the defendant Board, the cost of which should be borne by the Board.

 The Education For All Handicapped Children Act requires that all handicapped children be provided, at public expense, with a "free appropriate public education which emphasizes special education and related services designed to meet their unique needs." 20 U.S.C. § 1400(c). As Justice Rehnquist, speaking for the Supreme Court in Board of Education v. Rowley, 458 U.S. 176, 102 S. Ct. 3034, 73 L. Ed. 2d 690, 50 U.S.L.W. 4925, (1982), stated, "the Act represents an ambitious federal effort to promote the education of handicapped children, and was passed in response to Congress' perception that a majority of handicapped children in the United States 'were either totally excluded from schools or [were] sitting idly in regular classrooms awaiting the time when they were old enough to "drop out."'" Id. at 4926 (citations omitted).

 Under the Act, the "free appropriate public education" to be provided must be specially "tailored to meet the unique needs of the handicapped child" by means of the IEP. Id. at 4927. The IEP is to be prepared at a meeting between a qualified representative of the local educational agency, the child's teacher, the child's parents or guardians, and where appropriate, the child. Local educational authorities must review, and if necessary, revise each child's IEP, including its statement of goals and objectives and list of specific services to be provided, at least annually. 20 U.S.C. § 1414(a)(5).

 Here there is no dispute that an appropriate IEP was prepared and agreed upon by the defendant Board and plaintiff parents. Further, there is no dispute that these parties also agreed to the implementation of the IEP through D. G.'s placement in the Child Day Hospital. The sole issue before me is whether the "psychotherapy" or counseling services provided by the Hospital staff to D.G. constitutes a covered "related service" within the meaning of 20 U.S.C. § 1400(c).

The term "related services" means transportation, and such developmental, corrective, and other supportive services (including speech pathology and audiology, psychological services, physical and occupational therapy, recreation, and medical and counseling service, except that such medical services shall be for diagnostic and evaluative purposes only) as may be required to assist a handicapped child to benefit from special education . . ..

 The Federal Regulations promulgated pursuant to the Act provide a further layer of definitions. 34 C.F.R. § 300.13(b)(8) provides that "psychological ...

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