Katarina Harju 2015 Q&A: Finances, Group 1

If elected to the board, will you push for a published yearly budget? What would you consider key items in a budget?

I think that a budget is one of those basic things that any organization needs to have, so I find it vitally important that we figure out a process to make a budget in time for every fiscal year. Once we do manage to make a budget (and repeat the same process every year) I see no practical reason not to publish it, and in fact making it public would be a good start towards demonstrating our accountability.

The key items would be things that are probably also rather obvious to include: our expected income (donations, interest, possible income from OTW merchandise) and what we plan to spend money on during the fiscal year (how much different projects need, changes to previous years costs). Of course, this means that developing a functional budget requires input from all the different committees.

A nonprofit’s board has a fiduciary responsibility regarding its assets, which includes making sure they earn a reasonable interest rate. In the past three years, despite our considerable reserves, our investment income (per the OTW’s tax filings and Annual Reports) has been, respectively, US$5, US$40 and US$18. If elected, would you hope we can do anything different about this?

I’m not that familiar with interest rates in US banks, but that does sound like very little for the amount of funds the OTW has had in recent years. If we adopt a surplus budget—which considering the OTW’s, and more specifically the AO3’s, rapid growth does seem most sensible—it would certainly make sense that the surplus would be able to generate more interest than what it has so far. Furthermore, with a budget in place it would be possible to invest the surplus while keeping sufficient funds for projected expenditures and keeping a healthy cash reserve in place.

Because we are dealing with donated funds, we have a responsibility to be careful with them, because of this and because of US tax laws we would have to make conservative passive investments. This basically boils down to the fact that we should start with moving some of our money into an account with better interest rates.

The latest three OTW fundraising drives had escalating goals: US$70,000; US$100,000; US$175,000 (October ’14, May ’15, October ’15). How would you define responsible fundraising in a fandom context? What does it mean for our finances?

Responsible fundraising to me means that we need to be transparent. We need to be able to tell people why we are asking for the amount of money we do, to show them what we plan to use money on and to tell them what the money has been used for. We can’t afford to lose the confidence of our donors. To keep hiking up the goal for each successive membership drive without ever giving a good explanation for why the goals keep rising seems to me like a good way of alienating our donors.

It’s important that whoever handles the finances and accounting (at this point our Treasurer and Board as a whole) communicates with the people in charge of fundraising (the Development & Membership committee) to ensure that the goals are set according to our needs. Having a budget would make this much clearer and easier.

There have been complaints in the past, particularly from AO3 committees, of some of the OTW’s service bills not being paid on time or being paid very last-minute—sometimes resulting in committees temporarily losing access to tools they need for their work. What do you think can be done to prevent this from happening in the future?

If the payments are recurring and consistent, then it should certainly be possible to look into some form of automatic payment. Other than that, all I can say is that we need to have someone reliable in charge of paying the bills and to make sure that there is some form of backup for that person, in case they are unavailable for whatever reason.

Atiya Hakeem 2015 Q&A: Finances, Group 1

If elected to the board, will you push for a published yearly budget? What would you consider key items in a budget?

Yes, a budget is essential. So far we have never had an actual budget, but only a retroactive statement of how our money was spent. That is a necessary thing for accountability purposes, but it is no help in setting our fundraising goals or allowing committees to plan based on what resources will be available.

Key items on a budget are, of course, what assets we have, itemized lists of what expenses we expect each committee to incur in the following year (worked out in conjunction with the committees in question), and an estimate of what funds we expect to raise.

A nonprofit’s board has a fiduciary responsibility regarding its assets, which includes making sure they earn a reasonable interest rate. In the past three years, despite our considerable reserves, our investment income (per the OTW’s tax filings and Annual Reports) has been, respectively, US$5, US$40 and US$18. If elected, would you hope we can do anything different about this?

Yes. Even just putting more money in Certificates of Deposit would be better than this. I don’t think we are in a position where our reserve assets are large enough to justify a financial advisor or any fancy investment instruments, but making sure we earn as much interest as possible without risk seems like a really good idea. Once we have an actual budget, we can decide how much money we want to keep in reserve, and what kind of flexibility we need for accessing it.

The latest three OTW fundraising drives had escalating goals: US$70,000; US$100,000; US$175,000 (October ’14, May ’15, October ’15). How would you define responsible fundraising in a fandom context? What does it mean for our finances?

I think that responsible fundraising in any context requires knowing what one’s projected expenses are, and choosing a goal in keeping with them, rather than simply picking an arbitrary round number larger than the last time. Any donor base has a finite amount of money, and crying wolf or going to the well too often will give short term results at the expense of ongoing support. Donors want to see not only what we’ve done with their money in the past, but to know that we have a plan for what to do with it in the future.

The fandom context is relevant in that we have a particularly invested donor base, who feel ownership of our organization and our projects. That is great, since it means we can count on them when we need them, in many cases even if giving is a financial burden. However, it means that our donors will be particularly sensitive to questions of whether their money is being used well.

I think fiscal responsibility to ensure we spend sensibly, on necessary expenses, and fiscal transparency, so that our donors know this is the case, are essential for us to maintain the trust of our donors.

There have been complaints in the past, particularly from AO3 committees, of some of the OTW’s service bills not being paid on time or being paid very last-minute—sometimes resulting in committees temporarily losing access to tools they need for their work. What do you think can be done to prevent this from happening in the future?

Indeed, as a staffer I have experienced this issue on several occasions. I think fixing it should be extremely easy. First, set up automatic renewal for services that allow it. Second, resurrect an actual Financial committee. The committee should have records of what needs paying when, and contact information for all suppliers, stored in a location that all members can access. That way, if the chair for some reason is not available to make a payment, things don’t just fall through the cracks. A system for paying the bills reliably seems like a really obvious and necessary thing for any organization to have, and something that our volunteers should certainly be able to expect.

Andrea Horbinski 2015 Q&A: Finances, Group 1

If elected to the board, will you push for a published yearly budget? What would you consider key items in a budget?

I think it’s crucial that OTW have an annual budget, which we did for the first time in 2014. One of the key goals of the annual meeting in Vancouver is to come up with a budget for 2016, and we anticipate that approving the budget for the next fiscal year will become a key part of annual meetings of the Board from now on. The budget should absolutely be available internally, but I would want to invite feedback from Legal and consider carefully whether making it available publicly would be in the organization’s best interest. As for key items in the budget, in general at present I would say hardware/physical assets, training, travel, software and services, and consultants/contractors.

A nonprofit’s board has a fiduciary responsibility regarding its assets, which includes making sure they earn a reasonable interest rate. In the past three years, despite our considerable reserves, our investment income (per the OTW’s tax filings and Annual Reports) has been, respectively, US$5, US$40 and US$18. If elected, would you hope we can do anything different about this?

I disagree with the notion that the job of a non-profit’s money is to earn interest. A non-profit’s money is raised for the purpose of carrying out its mission, and large chunks of cash sitting around in interest-bearing accounts or instruments are large chunks of cash that aren’t fulfilling the mission and that may be leading prospective donors to think that we don’t actually need the money we ask for in fundraising campaigns. There’s also the additional complication that interest rates in the United States have been at or near zero for several years now, so to earn any appreciable interest we’d have to tie up significant chunks of cash in long-term certificates of deposit or other financial instruments that entail penalties for early withdrawal (and even with those the rates generally aren’t great). Is earning interest on the assets we have something that the Board should consider, and attempt to do so when feasible? Yes, but it should not be a higher priority than carrying out our programs.

The latest three OTW fundraising drives had escalating goals: US$70,000; US$100,000; US$175,000 (October ’14, May ’15, October ’15). How would you define responsible fundraising in a fandom context? What does it mean for our finances?

We have set the past few fundraising goals in order to cover the OTW’s operating costs, which we incur in order to carry out its mission. Asking for any amount that is less than the money we need would be fiscally irresponsible, particularly since the only reasonable assumption is that our costs are only going to increase over time. I appreciate that the fundraising goals seem like a large amount from the perspective of one individual donor, but much like Wikipedia, if all the people who regularly visited AO3 donated just a dollar, our campaign goals would be met instantly. And while no one should feel obligated to donate to the OTW, particularly if their own finances mean that they can’t afford to do so, changing our own fundraising goals based on assumptions about whether donors can afford to donate would be denying them their own agency and the chance to support our work. It’s not selfish or greedy for us to ask for the money we need in order to do our work; donating is the primary way that most people can support OTW and AO3, and we’ve been very gratified over the past few drives to see that people want to support our work and have been so very generous with their support.

There have been complaints in the past, particularly from AO3 committees, of some of the OTW’s service bills not being paid on time or being paid very last-minute—sometimes resulting in committees temporarily losing access to tools they need for their work. What do you think can be done to prevent this from happening in the future?

We’re planning to move to a new, revamped financial structure under the new Treasurer that should entail better documentation of invoices and ensure on-time payments for all the OTW’s services and vendors.

Aline Carrão 2015 Q&A: Finances, Group 1

If elected to the board, will you push for a published yearly budget? What would you consider key items in a budget?

We need a yearly budget. This budget should contain all expected expenses by each org committee. We need to ask committees beforehand,regularly, and well in advance, about what their spending might be, encouraging committees’ forward planning about their expenses and helping them establish priorities, so that the board can know how best to prioritize in case there is more demand for funds than funds available. Key items are all the core expenses that keep the OTW and projects up and running, such as servers, racks, colocation, software, and bank fees.

A nonprofit’s board has a fiduciary responsibility regarding its assets, which includes making sure they earn a reasonable interest rate. In the past three years, despite our considerable reserves, our investment income (per the OTW’s tax filings and Annual Reports) has been, respectively, US$5, US$40 and US$18. If elected, would you hope we can do anything different about this?

Yes, there are low-risk investments that we should investigate. Once we have a budget and more organized bookkeeping in place we will have a better picture of how much money we will need when and how much can be set aside without need for liquidity in the short-term. This will help us plan the best way to go about investing responsibly.

The latest three OTW fundraising drives had escalating goals: US$70,000; US$100,000; US$175,000 (October ’14, May ’15, October ’15). How would you define responsible fundraising in a fandom context? What does it mean for our finances?

We need to define our fundraising goals based on our projected expenses and needs, and communicate with our users and members clearly about those during our planned fundraisers. We should have clear budgets and reports to share that explain why we’re fundraising specific amounts, explaining what we’ve used the money that we’ve raised so far for and what we’ll use the money we’re asking for in the future. Fandom has been very generous with the OTW, and it’s our responsibility to honor that generosity by showing we deserve it.

There have been complaints in the past, particularly from AO3 committees, of some of the OTW’s service bills not being paid on time or being paid very last-minute—sometimes resulting in committees temporarily losing access to tools they need for their work. What do you think can be done to prevent this from happening in the future?

We need to have more than one person in charge and with access to our accounts, and with the power and the responsibility to pay the bills. Establishing a clear calendar and procedure regarding bills, including who is in charge of doing it (with a failsafe in case this doesn’t get done by a certain date). I also believe we should shift the bills that we are sure will not be changed in the near future to automatic payments, which would minimize the risk of these problems happening at least in some cases.

Alex Tischer 2015 Q&A: Finances, Group 1

If elected to the board, will you push for a published yearly budget? What would you consider key items in a budget?

The fact that this question even has to be asked is worrying to me. Of course I would want a yearly published budget. A prospective budget at that. That is such a fundamental item to have, the fact that the org does not, in fact, have anything like it yet completely baffles me. I would want regular updates about the budget during the year as well, even if it were just a short note like “unexpected expense from the left, this will affect the budget in the following ways” or “sticking to the projected budget numbers for now \o/”. Each committee needs to get used to thinking ahead for their expenses and to planning for expenses they might want to have. Being transparent throughout the organisation about things we’re all discussing spending money on would improve the quality of our tools, our capacity for projecting the OTW’s future requirements, and our ability to set sensible fundraising goals.

A nonprofit’s board has a fiduciary responsibility regarding its assets, which includes making sure they earn a reasonable interest rate. In the past three years, despite our considerable reserves, our investment income (per the OTW’s tax filings and Annual Reports) has been, respectively, US$5, US$40 and US$18. If elected, would you hope we can do anything different about this?

Yes, I would certainly hope we can do something about this, no matter if I were elected or not. This is another fundamental thing that should long ago have been taken care of. Yes, I am aware that interest rates are low in the US. However, those numbers are completely unreasonable. According to the finance updates in the Board’s minutes for the past year, only about US$10,000 of our money is invested. All the rest is sitting in PayPal or in our checking account. I am no expert, but that seems to be inadvisable financial planning.

The latest three OTW fundraising drives had escalating goals: US$70,000; US$100,000; US$175,000 (October ’14, May ’15, October ’15). How would you define responsible fundraising in a fandom context? What does it mean for our finances?

Our fundraising goals cannot exist in a vacuum or be a number we just pulled out of thin air. We need a budget and numbers so we can say, “We’re trying to raise this much, because we’re planning to spend this much on vital equipment” and so on. We have to stay aware that some of our donors are often quite literally giving their last bit of money that they can spare, because they enjoy our projects. We can never lose sight of that. One only has to follow the comments on many of the drive posts to see that fans are willing to give more than they can afford if they think it is needed. Creating an atmosphere of fear that a beloved website might cease to exist to increase donations is not an approach I would define as responsible fundraising. When setting any fundraising goal, we need to have a very clear outline of what we’ll do with the money that is raised in that drive upfront: US$X for this, US$Y for that. Donors need to know what they’re donating towards.

There have been complaints in the past, particularly from AO3 committees, of some of the OTW’s service bills not being paid on time or being paid very last-minute—sometimes resulting in committees temporarily losing access to tools they need for their work. What do you think can be done to prevent this from happening in the future?

For regular recurring bills — like for a bugtracker or a project management software — that do not need approval to be renewed from Board, it should be possible to set up some form of auto-payment, where bills are automatically paid on a certain date unless actively stopped. We do not have to reinvent the wheel here. Making use of already existing tools is a perfectly valid way of dealing with those payments. Always having more than one person who can make payments and setting up a reliable and transparent reminder system should cover the rest of the problem.