[nc-budget] AGENDA FOR BUDGET COMMITTEE AND DRAFT REPORT OF THE NAMES COUNCIL BUDGET COMMITTEE ON PROPOSED 2001 BUDGET

["Cochetti, Roger" <rogerc@netsol.com>]

Happy New Year and apologies again for the delay in getting this note to
you.  

We have two principal agenda items for the meeting of the Names Council
Budget Committee on Wednesday at 9:00 AM EST:

1) A report from ICANN management on their views on the question of how the
DNSO normal budget (i.e. the funds collected from dues payments by each of
the Constituencies) should be administered.  Louis Touton and Mike Roberts
will make a presentation to us on this item.  I plan to invite ICANN
management to remain on the call for the duration of our discussion of this
item unless any Committee member feels we should not do so.  

2) A review of our draft report to the Names Council, which follows, and
which itself addresses an invoice received from AFNIC and our proposed 2001
DNSO budget.  Please excuse and help me correct any errors in this draft
since, as I indicated, I lost my Budget Committee files in early December.

The call is scheduled for two hours.

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DRAFT REPORT

ICANN DOMAIN NAME SUPPORTING ORGANIZATION (DNSO) NAMES COUNCIL BUDGET
COMMITTEE

TO THE ICANN DNSO NAMES COUNCIL

4 JANUARY 2001

During October and November, the Names Council Budget Committee met three
times to address, among other things, two important questions:  (1) What
obligations, if any, does the DNSO have to AFNIC, which provided
administrative support to the DNSO and the Names Council during 2000?; and
(2) What should be the DNSO budget for 2001?

AFNIC PAYMENT

The Committee met with AFNIC on several occasions to clarify AFNIC's view of
the DNSO's financial obligations to AFNIC and requested that AFNIC provide
the Committee with an itemized statement of funds that AFNIC believes are
due to it for services rendered by AFNIC to the DNSO during 2000.  AFNIC's
representative explained that AFNIC had provided support services to the
DNSO during 1999 at no charge, but that it had advised the DNSO that any
services provided by AFNIC to the DNSO during 2000 would require some
compensation (AFNIC states that it does not seek full commercial
compensation for the services that it provided to the DNSO in 2000; only
partial compensation.)

The Committee requested a statement from AFNIC by 30 November 2000 for
services provided by AFNIC to the DNSO from January through November 2000.
This Statement can be found at
http://www.dnso.org/secretariat/2000.AFNIC-DNSO.html . It indicates that the
amount due to AFNIC from the DNSO is US $59,400.00.

The Committee examined the AFNIC statement in some detail an concluded that
the full amount of the Statement should be paid by the DNSO to AFNIC,
subject to three conditions:

(1) AFNIC provides the Committee with a clear statement that describes the
intellectual property rights that the DNSO has acquired by virtues of the
services provided by AFNIC to the DNSO during 2000; and

(2) AFNIC provides the Committee with an estimated allocation of the $59,400
among the various elements of the DNSO (Names Council, General Assembly,
etc.); and 

(3) AFNIC agrees to continue to support the DNSO at the same level that it
supported the DNSO during 2000, at no additional charge, for no more than
three months beyond 1 January 2001 to permit the DNSO to properly procure
support services for itself.

The Committee recommends that the Council adopt this approach and so
authorize the payment to AFNIC.



2001 DNSO BUDGET

As indicated in the attached note to the Committee from ICANN management, as
of 6 December 2000, the DNSO had received a cumulative $95,500 in payments
from DNSO Constituencies during 1999 and 2000.  In addition to this amount,
various DNSO constituencies have indicated that they would be providing
additional payments against their dues fairly soon.  Whatever the amount
collected, if the Budget Committee recommendation of a $59,400 DNSO payment
to AFNIC is accepted (along with modest payments already made to the Berkman
Center for services provided to the DNSO), this would leave a balance in the
DNSO account of around $35,000 plus any additional funds collected after 6
December 2000.  These excess funds could obviously be applied to DNSO
expenses in 2001.

In addition, as noted in previous Budget Committee reports to the Council,
the Committee is in the process of structuring a "voluntary fund" that would
be independently administered and that would be used to finance the cost of
providing professional support services to the DNSO.  When this voluntary
fund is established, donations may be made to it and VeriSign Global
Registry Services has indicated that it would match all donations made to
this fund up to $100,000.

As a result of the above, the Committee concluded that it would construct a
proposed DNSO 2001 budget based on the assumptions that there would be at
least a $35,000 carry over of funds from 2000 to 2001 and that the voluntary
fund that is planned would come into operation and it would be used to cover
the costs of professional support for the DNSO in 2001.  Consequently, the
Committee's budget analysis assumes that no funds from the regular budget
are allocated for professional support and that in setting 2001 dues for the
DNSO constituencies, a roughly $35,000 beginning DNSO balance should be
presumed at 1 January 2001.

Using these assumptions, the Committee proposes an expense budget for the
DNSO for 2001 of $118,100, consisting of the following general categories of
expense:

Administrative		$12,000
Telecommunications	$18,100
Travel			$25,500
Web/Listserv Maintenance	$30,000
Web casting			$0
Language Translations	$10,000
Accounting/Other Fees	$12,000
Contingency			$11,000

In particular, the Committee notes that it is assuming that there is
professional support staff for the DNSO during 2001 and that it has budgeted
no funds for Web casting.

If this $118,100 expense budget is accepted and there is a $35,000 carryover
from 2000 to 2001, then the amount needed in 2001 dues would be $83,100;
which would result in a dues payment by each of the seven DNSO
Constituencies during 2001 of $11,871.

         

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To the DNSO Budget Committee:

As of 6 December, the status of contributions of constituencies to the
DNSO is as follows:

                          1st Call         2nd Call
Business Constituency   $5,000.00       $13,642.86 
ccTLD Constituency       $5,000.00        $1,200.00 
gTLD Constituency        $5,000.00       $13,642.86 
IP Constituency          $5,000.00       $13,642.86 
ISP Constituency	 $5,000.00            $0.00
NCDNHC                   $4,018.00            $0.00
Registrars Constituency  $5,000.00       $10,000.00 
Total Paid              $34,018.00       $52,128.58 
Total Called For        $35,000.00       $95,500.00 

Best regards,

Louis Touton




Roger J. Cochetti
Senior Vice President-Policy
VeriSign/Network Solutions, Inc.
rogerc@netsol.com <mailto:rogerc@netsol.com>
(703) 326-2585