Bonding
Requirements
Bonding requirements can
be found in NRS
394.480. The minimum bond amount is
$10,000, but a higher bond may be required. Bond amounts
are calculated by multiplying tuition times projected
enrollment time percentage of program length,
described as follows:
Tuition x Projected
Enrollment x Percentage of Program Length.
Length is calculated by dividing actual program length by one
year (52 weeks, 12 months, etc.). if the school offers
more than one program, each program is calculated separately and the
results totaled.
Examples
ABC Career School offers
a medical assisting program that costs $5,500. The
school projects enrollments of 60 students annually and the
program lasts 6 weeks. The bond would be calculated as
follows:
$5,500 x 60
x 11.5% (6 weeks ÷ 52 weeks) = $37,950
The bond would be rounded to $38,000.
Acme Academy offers an
automotive program that costs $16,000. The school
projects enrollments of 30 students annually and the program
lasts 20 months. The bond would be calculated as
follows:
$16,000 x 30 x
165.38% (86 weeks ÷ 52 weeks) = $793,846. The bond
would be rounded to $794,000.
Schools participating
in the U.S.
Department of Education's loan programs will have the bond
reduced by 88% as in the following example:
XYZ Training Academy
offers a paralegal program that costs $16,800. The
school projects enrollments of 85 students annually and the
program lasts 12 months.
$16,800 x 85
x 100% x 12% = $171,360
The bond would be rounded down to $170,000.
If the applicant is
eligible for and using Title IV programs, the above
calculations will be used, but the final dollar amount will
then be multiplied by 12% to determine the actual bond
amount.
Contact the Commission if you have any questions concerning bonding
requirements.
