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A council will be able to write off 90% of its spending deficit for special educational needs and disabilities (SEND) after it agreed a plan with the government.
Somerset Council and the Department for Education (DfE) agreed the plan, which includes investment into SEND services across the county.
Without the plan, the council would have had to meet the cost of the deficit in its annual budget from March 2028, which could force it to declare effective bankruptcy.
The Somerset Parent Carer Forum - a community interest company - welcomed the opportunity to "improve early support, strengthen inclusion in mainstream settings and create a more joined-up SEND system".
All schools in the county which are not academies are funded through the dedicated schools grant (DSG), which the DfE provides annually to the council.
The grant covers the budgets for individual mainstream primary and secondary schools, as well as early years provision and for children with SEND.
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Demand for SEND resources has increased significantly over the years and it was estimated in February that the council's DSG deficit would exceed £100m by the end of the financial year.
Under the plan with the government, £95m of the spending will be written off and SEND services will receive investment which includes the introduction of 50 additional specialists to work with young people up to the age of 25 to provide support as early as possible.
The Local Democracy Reporting Service said the expanded team would provide expertise in a range of areas including social, emotional, mental health, autism, speech and language therapy, neurodiversity and occupational therapy.
Councillor Heather Shearer, portfolio holder for children, families and education, said the investment would help more children and young people "learn, thrive and achieve in their communities".
"We will continue working alongside children, young people, parent carers and our partners to turn this plan into lasting improvements," she added.
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