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[council] REPORT OF BUDGET COMMITTEE TO NAMES COUNCIL
Attached please find the report of the Names Council's Budget Committee to
the Council. In it, the Committee advises the Council of two areas of its
action and requests Council approval for one item (changes in the
allocations for the DNSO 2001 budget).
I will be happy to answer any questions at the next Council meeting.
Roger Cochetti
Chair
Names Council Budget Committee
REPORT OF THE NAMES COUNCIL BUDGET COMMITTEE 8
AUGUST 2001
The Names Council Budget Committee met twice since
that last Council meeting and addressed three important topics:
1) The status of dues payments by
Constituencies pursuant to the new procedures adopted by the Council for
failures to pay; and
2) The status and outlook of the
campaign to generate voluntary donations to the DNSO; and
3) Revisions to the spending
allocations under the DNSO's 2001 budget.
A brief report on each follows.
1. STATUS OF DUES PAYMENTS BY DNSO
CONSTITUENCIES
In an effort to improve the payment of DNSO
mandatory dues by Constituencies, on the Committee's recommendation, the
Council adopted the following procedures earlier this year:
NC PROCEDURES FOR CONSTITUENCIES PAYMENT OF DUES
Regarding the procedures of the Budget
Committee, the Committee decided that its meetings should not be routinely
open, but rather should be open to members of the Committee and any member
of the Names Council who would like to observe. The Committee reached this
conclusion because:
(1) it often discusses financially
sensitive information; (2) members felt that the work of the Committee would
benefit greatly by an atmosphere in which innovative ideas could be floated;
and most importantly, (3) all of the Committee's reports to the Council and
actions by the Council are publicly accessible.
Regarding procedures to address the failure
of DNSO Constituencies to pay their assessed dues, the Committee discussed
this matter during three different meetings and in its January meeting
agreed to propose to the Council the following procedures:
>From the date that invoices are
mailed/e-mailed to representatives of
Constituencies, if payment is not received by the
DNSO or its agent by:
** 30 days, the Constituency is sent a
reminder letter and another
invoice
** 60 days, the Constituency is sent a
delinquency notice and the
delinquency notice is posted on the DNSO
Website
** 90 days, the Constituency is sent a "show
cause notice" (in which they are asked to show cause as to why their voting
rights in the Names Council should not be suspended) and they are charged a
5% late payment fee to cover the cost to the DNSO of the cost of money. The
5% penalty is added to that Constituency's dues for the next (not the
current) DNSO budget year.
** 120 days, the Constituency is sent a
"final notice to pay" and
charged an additional 5% late payment fee,
which is also due as a added
payment for their next year's DNSO dues
** 180 days, the voting rights, but not the
right to participate, of that Constituency's representatives to the Names
Council are suspended until such time as the DNSO or its agent receives all
past due amounts including the various applicable late payment fees.
On July 11th, ICANN management reported the
following status of dues payments by DNSO Constituencies for 2000 and 2001
(The DNSO operates on a January-to-January, calendar year. So, 1st Call
refers to 1999, 2nd Call to 2000, and 3rd Call to 2001):
> Amounts in US$.
>
> Receipts:
> 1st
Call 2nd Call 3d Call Total Recd
> Business Constituency $5,000.00
$13,642.86 $0.00 $18,642.86
> ccTLD Constituency $5,000.00
$1,292.59 $0.00 $6,292.59
> gTLD Constituency $5,000.00
$13,642.86 $15,371.00 $34,013.86
> IP Constituency
$5,000.00 $13,642.86 $15,371.00 $34,013.86
> ISP Constituency
$5,000.00 $0.00 $0.00 $5,000.00
> NCDNHC
$5,000.00 $0.00 $50.00 $5,050.00
> Registrars Constituency $5,000.00
$13,642.86 $16,857.14 $35,500.00
> Total Paid
$35,000.00 $55,864.03 $47,649.14 $138,513.17
> Total Called For
$35,000.00 $95,500.00 $107,597.00
>
> Other Donations
$9,050.00
> Constituency Donations
$138,513.17
> Total Donations
$147,563.17
> Earned Interest &
> (Bank Charges)
$1,487.46
> Disbursements
$(14,008.16)
> Total Funds on Hand
$135,042.47
In addition, ICANN management reported that
invoices for all DNSO Constituencies, except the Non-Commercial
Constituency, had been sent out on April 18, 2001. (The NCDNHC invoice is
being sent out by ICANN management this week.) According to this report,
three Constituencies ( ccTLDs, ISPs, and NC) have failed to pay their dues
from 2001 and the same three Constituencies, along with one more (Business
Constituency) have failed to pay their dues for 2001.
Importantly, the Committee took note of the fact
that since the 2001 invoices were sent out on April 18th, the DNSO had
failed to send out to Constituencies 30, 60, or 90 day notices as provided
in the procedures (There was some confusion with ICANN management on this
matter, which resulted in the failure by the DNSO to act.)
Under these circumstances the Committee addressed
two questions: (1) Did the Council intend that arrearages resulting from
Constituencies' failures to pay dues that were invoiced during 2000 would
trigger the new procedures (or do the new procedures only apply to dues
invoiced in 2001 and in later years? ). On this question, the Committee
concluded that the new procedures do not apply to invoices prior to 2001;
and (2) Does the failure by four Constituencies to pay their 2001 dues
trigger any of the actions envisioned in the new plan, notwithstanding that
the DNSO failed to provide the follow-up notices that were contemplated
under the plan. On this question, the Committee concluded that since the
DNSO had failed to provide 30, 60, and 90 day notices as contemplated under
the plan, then Constituencies that were invoiced on April 18, 2001 should
not be held liable under the terms of the plan. Accordingly, the Committee
decided to have the 30 day notices sent out as soon as possible by ICANN
management and recognized that the 60, 90, 120, and 180 day penalties would
kick in over 30 day increments after the 30 day notices were actually sent.
2. STATUS AND OUTLOOK OF THE CAMPAIGN
TO GENERATE VOLUNTARY DONATIONS TO THE DNSO
The Committee discussed the state of the current
campaign to generate voluntary donations to the DNSO. (These will be used
by the DNSO to cover the costs of providing professional support for the
DNSO and such donations will be matched by the VeriSign Registry on a
dollar-for-dollar basis up to $100K.) Unfortunately, no donations had been
recorded as of July.
The Committee again encourages each Constituency to
request that its members donate funds to the DNSO to permit it to operate
more professionally and competently. (If each member organization of each
Constituency would donate to the DNSO one tenth of the amount of money that
they spend on travel/entertainment for ICANN meetings, then the Budget
Committee's goal of raising $60,000 --or $120,000 after the VeriSign
Registry match-would easily be met!!)
The Committee gratefully accepted four volunteers
who stepped forward and agreed to serve as DNSO fundraising chairs: One
will focus on donations from outside of the DNSO and three will focus on
donations from members of the Constituencies. Together, they make up a new
fund-raising work group of the Budget Committee.
3. REVISIONS TO THE SPENDING
ALLOCATIONS UNDER THE DNSO'S 2001 BUDGET
The Committee re-examined the spending categories
and allocations that were approved by the Council for the DNSO's 2001
Expense Budget and recommends several changes to the Council in light of
changed circumstances. (Thus far this year, the DNSO has spent around
$37,000, mostly in charges from AFNIC for the provision of technical
management services) These proposed changes DO NOT CHANGE THE TOTAL DNSO
SPENDING and THEY DO NOT CHANGE THE AMOUNT OF DUES. The proposed changes
in the DNSO's 2001 budget would re-name one spending category ("Web/Listserv
Maintenance" would be re-named "Technical Services") and they would
re-allocate spending among the several categories (Increase the amount for
"Technical Services" and reduce the amounts for "Contingency", "Travel",
"Language Services" and "Professional Services" ).
The original 2001 DNSO Budget is
> Administrative
$12,000
> Telecommunications
$18,100
> Travel
$25,500
> Web/Listserv Maintenance
$30,000
> Language Translations
$10,000
> Professional Services $12,000
Contingency $35,000
The proposed DNSO 2001 Budget is:
Admin (e.g. scribe services)
$12,000
Telecom
$18,100
Travel
$10,000
Technical Services
$70,000
Language Translations
$5,000
Professional Services (e.g. audit, legal, etc.)
$5,000
Contingency
$22,500
Essentially, these changes would re-allocate an
additional $40,000 to Technical Services, by reducing spending from these
other four categories. The lower spending in these four categories mainly
reflects the fact that the increase in professional support that was
envisioned for the DNSO has not occurred by mid-year while the increase in
spending for Technical Services reflects an under-estimate of the costs of
this function..
Roger J. Cochetti
Senior Vice President & Chief Policy Officer
VeriSign
rcochetti@verisign.com
<mailto:rcochetti@verisign.com>
202-973-6600
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