Minutes | Board Finance Committee (BFC) Meeting 29 April 2021

BFC Attendees: Harald Alverstrand, Becky Burr, Ron da Silva, Danko Jevtović (Chair), Ihab Osman, Mandla Msimang, and Tripti Sinha

Other Board Member Attendees: Avri Doria and Lito Ibarra

ICANN org Attendees: Xavier Calvez (SVP, Planning and Chief Financial Officer), Franco Carrasco (Board Operations Specialist), Sally Costerton (SVP, Global Stakeholder Engagement, Senior Advisor to the President and CEO), Kirsten Crownhart (Manager, Financial Planning and Analysis), Elizabeth Le (Associate General Counsel), Alex Morshed (Finance Manager), Becky Nash (VP, Planning), Wendy Profit (Board Operations Senior Manager), Shani Quidwai (Sr. Director, Finance), Carlos Reyes (Director, Strategic Policy Planning), Amy Stathos (Deputy General Counsel), Mary Wong (Vice President, Strategic Community Operations, Planning and Engagement), and Victoria Yang (Planning Senior Manager)

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The following is a summary of discussions, actions taken and actions identified:

1. BFC Workplan – The BFC reviewed its Workplan for FY21, which is on track.
2. Review of Proposed Fiscal Year (FY) 22-26 Operating and Financial Plan (O&FP) and FY22 Operating Plan and Budget (OP&B) - The BFC received an update from ICANN org on the proposed FY22-26 O&FP and FY22 OP&B, including how these proposals have been adjusted by ICANN org to reflect community feedback received from the public comment period and engagement sessions with the community. For the Five-Year (FY22-26) and FY22 Operating Plan, the planned activities and funding remain reasonable and unchanged from the draft that was posted for public comment. Based on the Strategic Outlook trends assessment, the key planning assumptions appear reasonable and valid as published in the draft for public comment. As such, the Board Strategic Planning Committee has recommended that the Strategic Objectives remain unchanged. The affordability assumption and balanced budget principle remains the same in the draft version that was published. The org made a few minor editorial changes as a result of the comments received.

   For the FY22-26 funding projections and FY22 funding, since publishing the draft plans in December 2020, ICANN org has experienced stable funding and there have been no market developments that dictate a change to the prior funding projections. In consultation with the Global Domains and Strategy team, ICANN org is maintaining the USD 144.4M funding budget in FY22.

   The FY22-26 five-year projections remain unchanged from the draft published for public comment. ICANN org added a table with financial estimate phasing by year based upon several comments received for clarification on funding of the Operating Initiatives. The BFC was advised that during the public comment process, ICANN org was made aware that the expenses associated with constituent travel were accurate, however the number of travel seats for the Governmental Advisory Committee (GAC) was incorrect and there was a GAC session that was not specifically included in the schedule. The GAC travel seats have been updated and there is now a separate line to highlight the High-Level Government Awareness Meeting which is planned to occur at ICANN74. This change to the text does not alter the previously published financials.

   Regarding the Additional Budget Request (ABR) process, there were no changes to the list of approved requests from the draft published for public comment. There were 30 requests submitted. ICANN org collaborated with the community to evaluate the submissions. Twelve requests are recommended for approval for a total of $209K. As to the remaining 18 requests, they are not recommended for approval because the requests: (i) did not demonstrate direct relation to current ICANN community policy development, advisory, and technical work; (ii) asked for additional travel to ICANN public meetings which is against the ABR principles; and (iii) should utilize other ICANN programs in place such as NextGen and CROP. It was noted that ICANN org will pilot a "sandbox" concept for tech tools that can better support virtual community work, tentatively scheduled to start January 2022. In addition to the approved requests, eight requests from FY21 ABRs totaling USD 253K were added to the core FY22 Budget, approximately USD 1M has been added to the core budget via this process over the last 5 years.

   The BFC also reviewed the funding trends, which assumes stable funding aligned with prior years notwithstanding several unknowns due to the pandemic.

3. Next Steps and Recommendation – Following discussion on the proposed FY22-26 O&FP and FY22 OP&B and how these proposals have been adjusted by ICANN org to reflect: (i) community feedback received from the public comment period and the engagement sessions with the community, the BFC approved a recommendation that the Board approve the FY22-26 O&FP and FY22 OP&B.
   • Action: ICANN org to prepare relevant materials for Board consideration.

4. AOB – The org briefly informed the BFC members that the Board Accountability Mechanisms Committee recently recommended that the Board approve a tranche of funds to pay legal fees in a particular dispute matter. The org noted that the recommendation will be considered by the Board at its next meeting. The org also reported on the spend to date of the tranche of funds approved last year for another dispute matter.

   • Action: ICANN org to send the BFC relevant materials to be submitted to Board consideration.

Published on 17 May 2021