Dear Sub Team Members, Please see below the action items and discussion notes captured by staff from the meeting on 14 February. These high-level notes are designed to help Work Track Sub Team members navigate through the content of the call and are not a substitute for the recording. Please also see the recording on the meetings page at: https://community.icann.org/display/NGSPP/Work+Track+1+Meetings. Please note also that the slides referenced below are attached and for ease of reference chat excerpts are included below. Best, Julie Julie Hedlund, Policy Director New gTLD Subsequent Procedures Sub Team – Track 1 - Overall Process/Support/Outreach Issue call Tuesday, 14 February 2017 at 3:00 UTC Apologies:  Laura Watkins, Susan Payne On audio only: Agenda: 1.            Welcome & SOIs 2.            Update:  Accreditation Program 3.            Application Fees/Variable Fees – Consensus Vote 4.            Application Guidebook, https://community.icann.org/display/NGSPP/4.2.5+Applicant+Guidebook?preview=... 5.            CC2 Questions, https://docs.google.com/document/d/1iZBCVEAJPBYEDg7jLsMHKkNczR_b6-jH2Wl5eVH-... Notes: 1. Update: Accreditation Program -- Update from Jeff Neuman on parallel GDD RSP Program: Need to determine policy work.  Timing in relation to GDD RSP. -- Discussed that there would be a number of similarities from one registry to another.  ICANN process.  Recognized that there would be a lot of similarities in the processes.  Discussed in Hyderabad.  In early January ICANN issued a call for volunteers for this group.  -- Note current CC2 questions (slide 4) 2.  Applications & Variable Fees (slide 5) -- Asked for responses using the green checkmarks:  Statement: Lack of Invoices were a challenge:  Responses: 8 green checkmarks. -- Different costs for different categories -- considering that?  Trying to get some insight into that.  May not be worth having different fees, but having a different cost structure. -- Set out the policy principle -- that this is a valuable piece of real estate.  May lower the cost recovery. -- We need to keep the bar raised.  Explore that cost recovery is supposed to be for? -- ICANN may have overestimated evaluation costs. Policy construct should be based on this last round.  There should be a floor in place. -- Cost recovery is likely to stay in place without making things too cheap. -- Get community feedback.  Come up with a policy position.  Don't say the cost, but how to determine it.  Focus more on the policy issues.  Extract principles from this call.  Recognition that ICANN recover all of its costs and this is a valuable part of ICANN real estate.

From the chat:

Alan Greenberg: If some people need invoices, what would be the reason for not doing it? Rubens Kuhl: Alan, tax regulations in some countries are more bizarre that the old English colonies habitants can think of... ;-) Michael Flemming: Alan, the issue is that the invoices are not sent timely, have a lot of mistakes, and some invoices don't even make it to us. 3. Cost Recovery Fees (slide 5) -- Reword the question: Even if costs are much lower there should be a floor that is lower. -- Agree with Jeff.  Cost recovery is important.  Why not change it do a deposit? -- Take a closer look at the numbers.

From the chat:

Alan Greenberg: Apparently we need to not only ask for an invoicing system but a TIMELY one... Jon Nevett: do we need to justify the difference? Trang Nguyen: @Jeff: I'm happy to give my personal opinion if asked, but don't think it's appropriate for me to vote on consensus calls. I view my role here as providing information to help inform deliberations. Rubens Kuhl: We could offset the fixed fees of all registries that come out of a procedure. If 1 million was raised, 900 thousand spent, 100 thousand divided by 1000 applicants, 100 dollars discount for everyone. Donna Austin, Neustar: I think my point was that the application fee needs to take into account that the applicant is acquiring a unique piece of internet real estate. In this context i don't think it's unreasonable to have the floor set at $185,000. Michael Flemming: But the problem comes back at two points.. 1. The cost recovery is too high; and 2. What do you do with the extra? That is from a Brand perspective, of course. Jon Nevett: unlike in the 2012 Round, we need to indicate what happens to excess application fees -- the 2012 AGB said what happens to auction proceeds, but not excess application fees Donna Austin, Neustar: Agree with Jon Michael Flemming: I agree with Jon there. I wasn't even aware of the cost recovery until they talked about offsetting the fees. Cheryl Langdon-Orr (CLO): that makes sense to me Jeff Jeff Neuman: I agree with Jon and Donna on that.   I thikn we do ask that in CC2 Jon Nevett: depends on how long we take -- ICANN charges back for historical costs -- $185 might not be enough :-) Rubens Kuhl: $185k is not small cash for some world regions. So even for organisations that don't qualify for applicant support, and shouldn't, would be disinfranchised by such a large fee. Jeff Neuman: So, how can we word this as a policy concept without indicating an exact figure? Donna Austin, Neustar: @Rubens, I accept that is the case but running a TLD is also not small cash. Cheryl Langdon-Orr (CLO): agree  Rubens Jeff Neuman: So let ICANN figure out what the figure should be, but indicate we really mean cost recovery this time, but having a floor to reflect this is a piece of Internet real estate, but that we do not necessarily need such a large contingency fund.....and perhaps the "pre-approval" of RSPs ccould cover their own costs Rubens Kuhl: @Donna, iwhat multiple of yearly recurring costs would you find applicable for the application fee ? Cheryl Langdon-Orr (CLO): as we explored in the old Applicant Support work though Donna, getting funding for  ongoing costs is often easier in some communities and economies, than raising funds for a 'blue sky' project.... Donna Austin, Neustar: @Rubens, I don't understand your question. Rubens Kuhl: @Donna, let's say that running a registry costs USD 100k a year. So 2 times for application fee would be enough ? Cheryl Langdon-Orr (CLO): agree  Rubens Jeff Neuman: So let ICANN figure out what the figure should be, but indicate we really mean cost recovery this time, but having a floor to reflect this is a piece of Internet real estate, but that we do not necessarily need such a large contingency fund.....and perhaps the "pre-approval" of RSPs ccould cover their own costs Rubens Kuhl: @Donna, iwhat multiple of yearly recurring costs would you find applicable for the application fee ? Cheryl Langdon-Orr (CLO): as we explored in the old Applicant Support work though Donna, getting funding for  ongoing costs is often easier in some communities and economies, than raising funds for a 'blue sky' project.... Donna Austin, Neustar: @Rubens, I don't understand your question. Rubens Kuhl: @Donna, let's say that running a registry costs USD 100k a year. So 2 times for application fee would be enough ? Justine Chew: I agree with Jeff's approach. Also can some portion of the excess application fees from 2012 be designated as financial support for the next round of applicants which fall under Ruben's group of "some world reigion" - based on some set criteria of course? Jon Nevett: so maybe the fee shouldn't be cost recovery -- it should be a fixed amount -- but any excess amounts collected should go to Y.  i definitely don't agree that excess fees of one round should go to the next -- might be ok for auction proceeds, but not excess app fees Donna Austin, Neustar: @CLO, perhaps the Applicant Support aspect should be expanded to cover Ruben's point. Jon Nevett: @Donna -- and that would be a good use of auction proceeds Rubens Kuhl: Justine, I'm not advocating for lesser fees for all organisations from underserved regions... even in underserved there are some "large pockets". But a large pocket in those regions mean one thing, in others, another. Trang Nguyen: There's some program cost in the FY17 CANN budget here (page 32) https://www.icann.org/en/system/files/files/adopted-opplan-budget-fy17-25jun....  Page 33 of that budget has a break-down of eval cost per eval panel. Justine Chew: @Rubens, sure, I don't mean in blanket. Any such an applicant ought to be deserving, based on some set criteria. @Jon, what is Y? Rubens Kuhl: The deserving applicants are of concern for applicant support... but by establishing a fee that is not based on cost recovery, but from economic power of usual orgs in large markets, this automatically cuts in a different level for underserved regions. Michael Flemming: But does everyone want to contribute to  applicant support? Do our fees make up for applicant support? Rubens Kuhl: And there is the warning that's usually repeated that defining fees per region leads to gaming by setting up shell corporations in those regions.. Michael Flemming: I think that goes back to a point that was made at the Hyderabad APAC space in regards to this subject that if the applicant fees are too low for underserved regions, then it undermines the actual costs of the variable fees that they need to undertake to run the TLD. Trang Nguyen: And this is the new gTLD Program budget memo from 2010: https://archive.icann.org/en/topics/new-gtlds/explanatory-memo-new-gtld-prog..., Michael Flemming: The special pieceJon Nevett: review=withdrew Trang Nguyen: @Jeff, it's difficult to break down the eval cost of internet real estate is not just the application fee, but the cost that goes into running it, too. Jeff Neuman: Trang, its hard to read that slide 32 without knowing how many evaluations we conducted. Jon Nevett: Some review pre-eval, but not too many Jeff Neuman: CC2 asks some questions on this as well (namely, how should surpluses be spent), et. Justine Chew: +1 Jeff. Jon Nevett: review=withdrew Trang Nguyen: @Jeff, it's difficult to break down the eval cost per app because some apps were withdrawn after initial eval, some required re-evaluation due to change requests. What the FY17 budget tells us is the total eval cost. Christa Taylor: Will combine and come up with a high level questions to consider for the next call 4. Application Queuing: IDN prioritization (slides 6, 7, and 8) -- See slides 5, 6, and 7. -- Had to choose whether they were in the prioritization draw. -- There were IDN applications could purchase a ticket to be one of the 100 applications to purchase a ticket.