No. Leave them as Grade 12 for the remainder of the 2016-2017 school year. As part of the End of Year Procedures you will define a New Grade Level for the Class of 2017 (ie. G17) that will be selected as the Next Grade Level for the Grade 12 students. When you roll over the database to the 2017-2018 school year all Grade 12 students will become Grade G17.
NOTE: Grade 12 students who remain in the district for the new school year must have Next Year (school) and Next Grade Level fields filled in prior to rolling the database over to the new school year to indicate they are being retained (ie. Next Grade Level = 12) or returning for post Grade 12 for additional services (ie. Next Grade Level = SP).
Additional information can be found in iPASS Help > Administration > Help > End of Year Procedures Help Document.