Placement is a critical part of the IEP, as it states where a child will receive special education services. Placement is established in the NOREP, the Notice of Recommended Education Placement, which is a document attached to the IEP that must be signed by the parent or guardian every year.
Least Restrictive Environment (LRE) is a legal concept established by the Individuals with Disabilities Act. It states, simply, that the default placement must always be the neighborhood school with general education students in a general education classroom unless the specific needs, disabilities or challenges specific to a child make a more restrictive placement necessary. These placements would be from least to most restrictive: full inclusion, resource room, self contained classroom, special school placement and finally residential treatment school.