Subject: [nc-corp] 2003 GNSO BUDGET

From: "Cochetti, Roger" <[email-masked]>
Date: Mon, 9 Dec 2002 18:48:19 -0500

Attached you will find several documents that relate to the Generic Names
Supporting Organization budget for the period December 2002 through June 30,
2003.  The situation is a bit more complicated than we had understood during
our last meeting, so let me clarify a few points. 

First, a few administrative matters:

Up until now, we have been assuming that the DNSO and its Names Council
would continue to operate in a manner comparable to their operations during
2002 through June 30, 2003, at which time the DNSO would be replaced with
the new GNSO.  Consequently, we have made no changes to the 2002 DNSO budget
and been planning for a six month DNSO budget for 2003.

As I understand the current transition plan that will be considered by the
ICANN Board this weekend, the DNSO and its Names Council will cease to exist
upon ICANN Board approval of the proposed transition plan and they will be
immediately succeeded by the GNSO and its Names Council.  This means that we
need to convert the budget for the DNSO for the remaining weeks of 2002 into
the budget for the GNSO for this period.

More important, contrary to the assumptions that we have made, the budget
that we are planning for the period January through June 2003 is for the
GNSO and not for the DNSO.

----------------------

Second, on the current financial condition of the DNSO, attached you will
find two spread sheets that summarize the DNSO's financial condition as of
today:

The first spreadsheet is the current DNSO budget statement for 2002.  While
it does not reflect all of the expenses that we have incurred to date, it
does show that we have spent about $71,000 of out total budget of $98,000
for this year.

The second spreadsheet is the overall cash flow statement for the DNSO.  It
shows that for 2002 of the seven DNSO Constituencies, four have fully paid
their dues (Business, gTLD, IP and Registrars); two have made some payment
(ccTLDs have paid $2,000 and Non Commercial has paid $100); and one has made
no payments (ISPs.)  It also shows that the current cash balance of the DNSO
is around $52,000 -- which does not take into account up to around $30,000
in additional expenses that have been and will be o might be incurred during
November and December of 2002. 

----------------------

Third, on the GNSO budget for the first six months of 2003, we currently
have two proposals before us and I propose that we put them to a Committee
vote.  

The first is the budget that was approved at the last Budget Committee
meeting (labeled "Budget Committee" below.)  It shows a total GNSO expense
budget for January-June 2003 of $54,450.

The second is the budget that was proposed by Philip Shephard (labeled
PROPOSED 2003 DNS..." below.)  It shows a total GNSO expense budget for
January-June 2003 of $54,700.  The principal differences between the first
and second proposals, as I understand them, is that Philip would delete the
$9,750 for 13 task force and committee teleconferences and add a $10,000
contingency fund.  More important, from the perspective of dues, Philip
would use $25,000 of the DNSO's current cash balance to finance GNSO
operations during 2003, thereby leaving an amount that would need to be
raised from dues for this period of $19,700.

So, in my view, the major difference between the original Committee plan and
Philip's proposal is in whether the GNSO would retain a sizeable cash
balance at the end of June, 2003 at the cost of increased dues;  or whether
the GNSO cash balance would be used to fund GNSO operations during
January-June 2003, thereby reducing dues and leaving a small cash balance.
I have inquired with ICANN management as to whether they believe that the
reduced cash balance implied in Philip's plan would bring the GNSO's cash
balance below the minimal level of cash on hand that ICANN management has
required of the DNSO in order to administer the DNSO's funds.  They have not
indicated that Philip's proposal would bring the GNSO below the minimal cash
balance that has been required of the DNSO.

I therefore ask that you indicate whether you support

The original committee proposal; or

The Philip Shephard proposal.

For myself, I believe that the original Committee proposal, which implied
that a significant GNSO cash balance be retained, is prudent for the same
reasons that I have supported a DNSO cash balance in the past.  The GNSO has
obligations to people who depend on its timely ability to cover them and it
faces an uncertain income from Constituencies.  If many, most or all
Constituencies pay their, admittedly higher, dues in early 2003, then the
GNSO will have retained a substantial unnecessary cash balance -- which can
be used for constructive purposes in the future.  If, on the other hand,
many, most or all of the DNSO Constituencies fail to pay their dues before
June, 2003, then the cash balance will permit the GNSO to avoid either
closing down functions or failing to pay creditors or emergency calls for
additional contributions.

Regardless, please indicate whether you support the original committee or
the Philip Shepard proposals so we can take a Committee proposal to the
Names Council.

Thanks,

Roger Cochetti

Chair
Names Council Budget Committee  

Subject: PROPOSED 2003 DNSO BUDGET
From: Philip Sheppard <[email-masked]>
To: "Cochetti, Roger" <[email-masked]>
Cc: [email-masked], Bruce Tonkin Regs <[email-masked]>
Date: Wed, 4 Dec 2002 11:01:02 -0500

Roger and Budget Committee,
as requested please find attached a table showing my proposal compared to
last year actuals.
Philip
----------------
The proposed contribution is USD 4950 per constituency.
The Budget covers the proposed secretariat costs and NC calls as agreed at
the last Budget Committee call.
The Budget notes but does not include at this time the cost of task force
calls.
The Budget deducts the end 2002 reserves which will be a minimum of USD
25,000.
The Budget adds reserves of USD 10,000 to allow for the possibility of non
payment by two constituencies as at 30 June.
 
I hope the Budget Committee can give it full support and recommend this to
the NC.
 
Philip

Subject: Budget committee
From: DNSO SECRETARIAT <[email-masked]>
To: "Cochetti, Roger" <[email-masked]>
Date: Wed, 20 Nov 2002 12:21:54 -0500

Dear Roger,

Attached please find the adjusted projected Budget.

There are three columns,
col. 1 projected budget for 2002
col. 2 projected budget for 2003
col. 3 adjustments to projected budget after Budget committee discussion and
approval during teleconference November 20, 2002.

Contingency at 10% amounting to $8906 has not been included, but $9750 for
task force and committee teleconferences, covering 25%, (13)teleconferences
has been added.

Constituency fees, per constituency, for 2003 from January to June will
amount to $9075.
(The total amount $54450 divided by 6 constituencies)

Roger, let me know if you have anything else, or if you want me to circulate
this for a vote.

Thank you for approving the expenses for Amsterdam.
Glen