[ALAC] Briefing note: Use of gTLD Auction Proceeds for ICANN Reserve

Alan Greenberg alan.greenberg at mcgill.ca
Wed Oct 25 22:17:14 UTC 2017


Thanks Seun.

There is no question of the "legality" of ICANN using the auction 
find to top up the reset. Or at least I have never heard mention of 
such a concern.

Whether operating costs are reasonable and justified is an ongoing 
issue. It might be addressed in the current public comment, or in the 
one to be opened on the FY19 Plan and Budget.

Alan


On October 25, 2017 4:49:51 AM GMT+01:00, Seun Ojedeji 
<seun.ojedeji at gmail.com> wrote:
Hello Alan,
On the assumption that ICANN can legally use part of the proceeds to 
fund reserve, I'd be also can live with up to a 20% of whatever is 
the accessible amount of the AP.
However on a related note, I do personally think ICANN operating cost 
is quite on the high side in the first place and while effort is 
being made to get a 1 year reserve, i will be interested to know how 
much effort the Board is putting on 2 specific items:
1. Avoid continuous increase on the operating cost which could then 
make a year target meaningless.
2. Minimize operating cost as much as possible (of course without 
affecting the SO/AC part of things) so a 1 year reserve could end up 
sufficient for many more months when the need arises.
Regards
Sent from my mobile
Kindly excuse brevity and typos
On Oct 25, 2017 2:07 AM, "Alan Greenberg" 
<<mailto:alan.greenberg at mcgill.ca>alan.greenberg at mcgill.ca> wrote:
This is a briefing note in preparation for the discussion in AbuDhabi 
current scheduled for 9:30 am, local time, on Sunday.
As is common for non-profit organizations, and particularly ones 
where their income or expenses might be subject to unexpected 
fluctuations, ICANN maintains a "Reserve Fund" to allow it to cover 
unexpected expenses or below expectations income. Currently the 
target for the fund is one year's regular expenses, but due to 
unexpected expenses (primarily associated with the IANA transition 
and accountability exercise), it is below that. There is an open 
Public Comment where you can find out more about the fund - 
<https://community.icann.org/x/GJNEB>https://community.icann.org/x/GJNEB.
It has been suggested that some portion of the proceeds of the new 
gTLD Auctions (currently about $235m, although there is some chance 
it could be as low as $105m) be used to help build back the reserve.
Excluding this possibility, the target use of the Auction Funds will 
be projects that are aligned with ICANN's mission and enhance the 
Internet (wording still under debate).
This brief discussion will be to solicit thoughts on whether this 
would be a good idea or not.
Alan
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