Below is an overview of the NTN-ND's financial report for FY19.
For FY19, the annual budget for NTN-ND included funds remaining from the previous fiscal year that were withheld from transfer to depreciation and capital refresh and replacement, and revenue acquired through reimbursements from the state of South Dakota and the Pacific Northwest GigaPop. Since completing the full build for its segment in 2009, NTN-ND has remained fiscally healthy. No money is used to fund staff of NTN-ND partners UND or NDSU.
The FY19 report reflects a starting balance of $429,169.94 with total expenditures of $479,992. Reimbursements totaling $66,083 were received from the state of South Dakota for their portion of annual network and NOC expenses. Reimbursements totaling $42,848 were received from the Pacific Northwest GigaPop for their portion of annual network, telecommunications and hardware expenses. Funds remaining on balance at the end of FY19 will be used to cover expenses going forward into FY20.
Annual expenses of NTN-ND are incurred across five categories: equipment, fiber, network operations center, Internet2 and NTNC dues, and other operating. Additional expenses for depreciation and capital refresh and replacement typically adjusted (transferred?) at the end of each fiscal year were not deducted in FY17 due to statewide budget cuts, and again in FY18 and FY19 due to termination of state and University System funding support. The remaining account funds have been used to fund expenses for FY19.
Equipment: Cost related to equipment acquisition and maintenance fees.
Fiber: Operations and maintenance fees on fiber, and rack and power required to house equipment in space provided by the vendor.
Internet2/NTNC dues and participation fees: Annual Internet2 participation and connectivity fees, NTNC membership dues, sponsored participant fees and costs for Internet2 to accept and route traffic to and from NTN-ND. Internet2 membership dues and fees continue to change as the organizational structure for Internet2 and their member community evolves to address the needs of current research and academics.
Network Operations Center (NOC): Management of network equipment, including troubleshooting and response coordination for unplanned outages.
Other operations: Includes insurance, minor supplies, printing and shipping costs. Beginning in FY18, NTN-ND partners covered all of their own travel and per diem expenses relevant to R&E activities.
A much-anticipated amendment to the existing operating agreement between NTN-ND and the Pacific Northwest Gigapop was completed in April 2018 and has resulted in a significant decrease in annual NTN-ND operating expenses. The agreement ensures continuation of the existing and economical AT&T fiber lease for state segments of the NTNC between Washing and Minnesota through the end of the original 20-year lease agreement (2028). The amended agreement relieves NTN-ND of fiber lease expenses for a portion of the span. These cost savings include an 11.2% decrease in equipment; 60% decrease in fiber; and an 62% decrease in NOC. Combined total savings in these three areas of annual operations and maintenance for FY19 is more than $265,000. Annual expenses for Internet2 and other membership and participation fees, as well as other miscellaneous expenses remained constant for FY19. It is anticipated that the upcoming network upgrade planned for North Dakota, South Dakota and Minnesota will realize even more savings in annual operations and maintenance. The improvements for NTN-ND will mark a transition in operational status of the network, moving from a business model of owned assets to a model where the majority of daily operations is achieved through procurement of services from other entities.