NCSG Comment on Proposed Final Report of the New gTLD Auction Proceeds Cross Community Working Group

[Thato Mfikwe]

Thanks for the feedback, Sam.

Thato Mfikwe.

On Tue, 14 Jan 2020, 17:11 Sam Lanfranco, <lanfran at yorku.ca> wrote:

> Thato,
>
> Thanks for laying out some of the decision issues that NCSG might want to
> comment on. As one of the participants in the construction of the Proposed
> Final Report I have said that I will not offer suggestions but will answer
> questions, and expand where things look unclear or confusing. I would like
> to add two comments, one dealing with what I think was a typo on your part.
>
> You write: "*This call for community comment on the final recommendations
> of New gTLD Auction Proceeds will determine how these Auction Proceeds are
> replenished,...*" I think you meant to write how these Auction Proceeds
> are allocated. While some of us thought about schemes to replenish the
> funds, all through the writing of the Report the assumption has been that
> the funds are finite, will not be replenished, and hence the need for a
> "sunset strategy". Comments should assume that we are talking about a
> finite initial endowment in a mechanism that includes a sunset strategy.
>
> Second, just for clarity. While ICANN did withdraw funds ($30 Million as I
> recall) from the New gT:D Auction Proceeds to help rebuild the ICANN
> Reserve Fund, the new financial plan and budgets documents make it clear
> that there will be no more Reserve Fund drawn downs on the Auction
> Proceeds. The rebuilding of the Reserve Fund will come from annual
> operating revenues.
>
> Sam Lanfranco
>
> ---- Original Message ----
> *From*: Thato Mfikwe <thatomfikwe at GMAIL.COM>
> *To*: NCSG-DISCUSS at LISTSERV.SYR.EDU
> *Sent*: Tue, Jan 14, 2020, 9:23 AM
> *Subject*: NCSG Comment on Proposed Final Report of the New gTLD Auction
> Proceeds Cross Community Working Group
>
> Dear members,
>
> This is just a call to everyone for discussion and input into the NCSG
> comment on the final recommendations on New gTLD Auction Proceeds
> <https://www.icann.org/en/system/files/files/proposed-new-gtld-auction-proceeds-final-23dec19-en.pdf>.
> It would help if we can have editors on the document to support our
> comment
> <https://docs.google.com/document/d/1eyGGPIFFMhVbEpIZQexgXkKO67fU33PZfv7G8HVY6_c/edit>
> .
>
> This call for community comment on the final recommendations of New gTLD
> Auction Proceeds will determine how these Auction Proceeds are replenished,
> we there for request the community to help answer the following 3 questions:
>
> 1. Do you support the CCWG's recommendation in relation to the preferred
> mechanism(s)? If no, please provide your rationale for why not.
>
> 2. Do you have any concerns about the updates the CCWG has made, as
> listed above, in response to the Public Comment forum? If yes, please
> specify what changes concern you and why?
>
> 3. Is there any further information you think the CCWG should consider,
> that it hasn't considered previously, in order to finalize its report for
> submission to the Chartering Organizations?
>
>
> NCSG submitted a comment on the initial report and it seems like based on
> the final report, a majority of communities AC's, SO's and substructures,
> favoured Mechanism A and B, leaving Mechanism C out of 3 possible options
> for the replenishment of New gTLD Auction Proceeds.
>
> *Question 1 (Preferred mechanism)*
> *NCSG preferred Mechanism C according to the initial NCSG comment in
> December 2018
> <https://community.icann.org/download/attachments/79429792/Initial%20Report%20of%20the%20New%20gTLD%20Auction%20Proceeds%20Cross-Community%20Working%20Group%20-%20NCSG%20comment.pdf?version=2&modificationDate=1546455158000&api=v2>,
> which was an independent ICANN Foundation with its own Board of Directors.*
>
> Understandably so, autonomy needs to be exercised and upheld in order to
> ensure integrity in decision making as opposed to current accountability
> and transparency issues and discrepancies that emerge from time to time
> within ICANN the organisation.
>
> Based on the final 2 options, after shortlisting and according to the
> final report under review, *it seems like Mechanism B is better as it
> involved an external organisation which will work with ICANN to replenish
> these funds. *
>
> Option A, IMO, is not viable as it compromises independence in decision
> making, where ICANN might be required to open a new department that will
> deal solely on replenishments of Auction Proceeds reporting directly to the
> CEO and Board.
>
>
> Mechanisms in summary under review:
> *Mechanism A:* An internal department dedicated to the allocation of auction
> proceeds is created within the ICANN organization.
>
> *Mechanism B*: An internal department dedicated to the allocation of
> auction proceeds is created within the ICANN organization which
> collaborates with an existing non-profit.
>
> *Mechanism C**:* A new charitable structure (ICANN Foundation) is created
> which is functionally separate from ICANNorg, which would be responsible
> for the allocation of auction proceeds.
>
>
> *Question 2 (Any other concerns)*
>
> A criteria was developed to evaluate different mechanisms, namely:
> - Efficiency and effectiveness
> - Cost-effectiveness of setting up the mechanism (most value for money)
> - Cost-effectiveness of running the mechanism (e.g. overhead, operating
> costs)
> - Ability to sunset (i.e. terminate / close down)
> - Ease of setting up in terms of time and effort
> - Ability to meet legal and fiduciary requirements
> - Enabling ICANN stakeholder engagement
> - Efficient means for fund allocation from selection to fund distribution
> for projects
> - Administrative complexity to run
> - Means for oversight
> - Providing transparency and accountability
> - Equipped to operate and execute globally distributed projects
> - Balance of control between ICANN org and independence of fund allocation
> - Risk
>
> According to NCSG initial comment the role of the community has not been
> clearly articulated during the allocation and distribution of Auction
> Proceeds.
>
>
> *Question 3 (Any other considerations)*
> From me, I would propose that Mechanism A be completely removed and we
> remain with only B & C, as both options promise independence in the
> allocation of Auction Proceeds.
>
> Your input will be highly appreciated, thanks.
>
> Thato Mfikwe.
>
>
>
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