Many programs offer what is called an exit plan which involves making the kid finish the program or cutting them off. Often such a plan also has a strict list of conditions that the kid must follow in order to get to stay at home or have financial support during college.
If you are thinking about what will happen with your niece you may wish to consider opening your home to her if she needs it or if she finds herself unable to adhere to the rules of an exit plan if this is what her school has. If you are not in a financial position to help with college and her family cut off support for this it could also be a good idea to look at the financial aid options or scholarships of the colleges she is interested in attending and going over these options so that higher education does not become an unattainable goal.
those "contracts" are idiotic. here is why:
A. the schools make you sign the contract, or else they can manipulate you parents into sending you to another simmilar program ("more structured environment"), or keep you postgraduate.
B. the contracts are always on school terms first, then parents, then yours. in the end, you end up having little say in the contract other than the small meaningless points - like curfew hours or amount of chores done.
C. The contract is easily broken, and encourages more sneakiness. for every law enacted a new type of criminal is created. therefore, it can encourage more tension in the family
D. when the contract is broken, and the kid looses financial support, they go independent. but, instead of going independent while keeping the relationship with their family, they stop talking to them, usually for a very very long time.
In the end, these contracts destroy more relationships, and create more tension than could ever have been before.
I broke my contract the day i got back home. After the initial fiasco, my mom and dad smartened up and realized if they wanted a relationship with me, they should let me live my life on my terms, not hers.
In the end, if you look at this issue closely, you'll realize any school which would have, or needs an "exit plan" is not a school worth sending your child to. If they are that concerned about the difference in freedom (the "honeymoon syndrome", a.k.a the "parolee syndrome") upon release and worry about the kid getting into trouble again, then the program is obviously innefective at changing minds, just making them submissive. just like prison. which is exactly what most kids view these places as; regardless of how much you tell them youre "helping" them.