MetaGovernance Working Group Budget for Term 5, Q1/Q2 2024

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MetaGovernance Working Group Budget for Term 5, Q1/Q2 2024

This post outlines the MetaGovernance Working Group’s budget for the upcoming 6-month period, Term 5 Q1/Q2.

Below, we’ve outlined the previous term’s projected budget and actual spend, as well as the planned budget for the upcoming 6 months of Term 5, specifically Q1/Q2.
Descriptions of various categories can be found below the tables.

Previous Term 4 Q3/Q4 2023 (for comparison)

See this link to the secretary’s Term 4 spending report

Category Planned USDC Planned ETH Actual USDC Actual ETH
Working Group Compensation 202,800 0 214,200 0
Governance 83,500 0 0 0
DAO Tooling 91,000 0 110,000 0
DAO Sponsorship 15,000 0 0 0
MetaGov WG Discretionary 127,508 0 6,473 -
Contract Audits 0 0 49,000
Endowment Management Fees - 60 - 47
Total 519,808 60 379,673 47

Term 5 Q1/Q2 2024 Budget

Category USDC ETH
Working Group Steward Compensation 294,000
Governance 0 5
DAO Tooling 130,000
Sponsorships 5,000
MetaGov WG Discretionary 30,000 5
Contract Audits 90,000
DAO Bylaws Initiative 25,000
Endowment Management Fees 132*
Total 574,000 142

Category Descriptions

  • Working Group Steward Compensation - Compensation for Working Group stewards and the Working Group secretary.
  • Governance Reimbursements - Fee reimbursements and initiatives related to reducing friction in the governance process. Examples include gas fee reimbursements for voting or delegation changes, or reimbursements for proposal submissions and execution.
  • Tooling - Developing interfaces and dashboards to improve the governance process and increase transparency across the DAO. Examples are agora.ensdao.org and a proposal interface for the Executable and Social proposals.
  • DAO Sponsorship - Sponsoring DAO-specific events such as DAO NYC, DAO Tokyo, the Aragon DAO Hackathon, etc.
  • Discretionary - Funds distributed at the discretion of stewards towards new initiatives + governance experiments from the MetaGov Working Group Multisig.
  • Contract Audits - These are funds that will be used to pay for smart contract review and formal security audits. An example would be the code4rena audits on the namewrapper contracts.
  • DAO Bylaws Initiative - An RFP was begun in November of 2023 to select a provider to write a comprehensive set of DAO Bylaws. The expense for this is a one-time event, but we’re including it here in the budget for transparency. (For avoidance of doubt, this process will contemplate feedback from all DAO participants).
  • Endowment Management Fees - Fees paid to vendors or service providers for treasury management services. The current treasury management services are provided by Karpatkey and Steakhouse per [EP 2.2.5] with strategies described in this post here.
    *The Metagov group is currently evaluating alternatives that would allow the endowment management fees to be paid directly from the endowment itself, allowing for this operating expense to be removed from our budget.

$ENS Governance Token Distribution

The MetaGov Working Group continually evaluates the distribution of $ENS governance tokens to our various partner projects and contributors whose contributions allow for, and improve, the ENS DAO and Working Group operations.

The goal of $ENS distributions from the MetaGov WG is to increase ENS DAO participation from key individuals and DAO-related projects who continue to build the infrastructure that the DAO relies on.

One of the more significant changes we have planned this term is a more substantial initiative to distribute $ENS governance power through vesting contracts. The MG stewards are beginning an evaluation of several strategies that would ultimately allow for the full voting power of a grant to be available on day 1, while the full control or ability to transfer those tokens would vest over a multi-year period. This will be a public initiative, and we will openly seek feedback to ensure general consensus from the DAO.

For the Term 5 Q1/Q2 period, the following governance distributions are planned:

Recipient Category Amount of $ENS Method
Contributors and Developers 60k Vesting contracts
Elected Stewards 45k Change to vesting contracts is planned for the 2025 guidance

Current Metagov Wallet Balances

Address ETH USDC $ENS Notes
ens-metagov.pod.xyz 75.138 463,380 15,540
ens-governance.pod.xyz 0 0 0 To be deprecated
ens-daotooling.pod.xyz 0 0 0 To be deprecated
ens-endowmentfees.pod.xyz 10.55 0 0

*as of Jan. 22nd, 2024

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Highly supportive of vested governance & token lock distribution. Although there wil probaly be an engineering challenge with the power of vote will vesting. This mechanism is something i’ve briefly discussed in the past. I would maybe suggest the method used by protocol guild or an implementation of.

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I was looking over the breakdowns here and was hoping for some more info on the “discretionary” section.

How come there was a huge amount planned in Q3+Q4 2023 and then only $6k USD spent?

  1. Can anybody educate me on what this means:

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  1. It would be useful to do a break down of the
    Working Group Compensation and how many people that is given to. I’m assuming that is essentially like a wage? Paid retrospectively ? Or is it like a salary?

  2. the 132* Eth pay for Endowment management fees. Is that For just Q1+Q2 ? So will it double that by the end of the year?

Further more that’s almost a 300% increase in the cost for Q3-4 2023?? That’s insane and that is probably slightly above inflation rates …:face_with_spiral_eyes:

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Hey @meta8.eth,
Thanks for the questions.

IIRC, In the Term 4 metagov budget (Q3/Q4 last year), that discretionary amount was the delta between what was in the budget and what was remaining in the metagov wallet. Essentially, everything left in metagov’s wallet was just listed as discretionary. We perhaps shouldn’t have done it that way, as there was no intention of spending that on anything at the time - as indicated by the fact we only spent $6k of it.
Usually, that catagory is used for reimbursement of any expenses that come up throughout the term that weren’t planned or expected. I’m happy to share some detailed examples of what the discretionary category has been used for to date if that helps, and also what we generally think of when we try to plan that category out.
Term 5’s budget has 30k USDC and 5 ETH planned as discretionary, but this is by nature a tough expense category to plan for because it isn’t known ahead of time.

If you don’t mind, I’d like to point you to the steward comp thread to find the detail you’re looking for. Here’s that forum thread.

The monthly Endowment fees are calculated based on two components, the total “Assets Under Management” or AUM, and a percentage of the appreciation or yield of the assets. The doubling of the fees was when we doubled the size of the endowment (doubling the AUM).
Most of the explanaition of the fees is covered in this thread here: Updated Endaoment Proposal: Karpatkey & Steakhouse Financial
Happy to get into more detailed discussion about that arrangement if you’d like.

Hope that gives you some of the clarity you’re looking for, let me know if you have more questions.

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