I work at a school which has done this many times. We always look at the needs of the student over all else. Just because he has tested out previously does not mean that he cannot be put back into the program. First, I would look at why he is failing. Can he truly not handle the subject matter?Does he feel pressure from other students- given his history with previous special education classes? Is he trying to fail?
Ultimately, schools are here to help. I would talk to the special education department in your school and ask them about their thoughts.
An IEP committee probably requested a new comprehensive evaluation when your grandson's special education eligibilty was due to be reconsidered. Eligibility must be reconsidered every three years. On the basis of the evaluation results, an IEP committee may determine that the student no longer is eligible for special education services. If your grandson continues to have difficulties that impact his academic performance, a new evaluation can be done after one year.
Generally, your son is not likely to be tested again by the school. You can take him to your own psychologist to have him tested. If the school will not give him an IEP (Individualized Education Plan) you might be about to get him accomodations through a 504 plan.
Your son may be elligible for other services besides Special Education. There are many types of services available, depending on grade level and state. While it is not possible to give you a specific answer, keep in mind that there are many reasons a child is removed from Special Education. During testing, there has to be a discrepancy between the scores on tests and what intelligence tests hace determined is your son's natural ability. If he is already working above his ability, according to those tests, he may not qualify for services.
don't know, best to ask anyway, they might be able to retest him again, hipe this helps.