Change in Classification
When A School Changes Classifications, What Happens To Its Vested Status In The Youth Endowment Program
The following explanations are given to help clarify vestment status of schools who change classification status prior to becoming totally vested in the Youth Endowment Program.
Situation 1: A school becomes 100 percent vested and then changes classification.
Answer: The school is still 100 percent vested even though it may change to a larger or smaller classification status.
Situation 2: A school changes classification before reaching 100 per cent vestment in the Youth Endowment Program. Answer: During the month of July, prior to movement from one classification to another, the percentage of vestment will be calculated for that school. They will be credited with that percent of vestment as they move to another classification. That school will now be responsible for the remaining percentage at the rate related to the new classification status.
Example A: An 3A school has grown to the point that they are reclassified as 4-5A. During the month of July (prior to the new school year) all contributions for that school will be evaluated on a percentage basis for an 3A school. If they had contributed a total of $24,000 at this time, this would equate to 64% vestment. This means that they now owe 36% vestment at the 4-5A level of contribution or 36% of $50,000. This calculates to a total of $18,000. The total contribution for 100 percent vestment for this school would become a combination of $24,000 plus $18,000 for a total contribution of $42,000.
Example B: An 2A school has a closure of a major business in the community, which causes the school population to change to 1A status. During the month of July (prior to the new school year) all contributions for that school will be evaluated on a percentage basis for an 2A school. If they had contributed a total of $10,000 at this time, this would equate to 40% vestment. This means that they now owe 60% vestment at the 1A level of contribution or 60% of $12,500. This calculates to a total of $7,500. The total contribution for 100 percent vestment for this school would be a combination of $10,000 plus $7,500 for a total contribution of $17,500.
Your school will receive a percentage of money available for that activity based upon the percentage of vestment in the Youth Endowment Fund. This means if your school is 60% vested, you will receive a 60% share. Those who have not contributed to the Youth Endowment fund, will not receive any money from this fund source.