Is it possible to bring down the administrative costs? They’re more than 6% of the total request. Leaving aside lively discussion here and on the Milestone 1 thread, it’s just hard to see how high administrative costs can be justified.
To invert things a bit, would you provide a grant to an applicant that included costs that high? It’s not as if the funds are going to pay for developer hours or large legal expenses.
Many grants programs in the real world cap administrative costs at 5% or even 2%. We believe that no one should work for free, but the cost structure seems like it can be better optimized, especially since Arbitrum Foundation presumably continues to bear costs of KYC/KYB compliance for onboarding of grantees?
For a comparison, let’s put it side by side with the upcoming LTIP pilot. Dollar amounts just plug in today’s price of ARB and should be taken as just rough estimates.
| Milestone 2 | LTIP Pilot | |
|---|---|---|
| Grants Budget | 30,000,000 ARB | 45,100,000 ARB |
| Administrative Budget | $3,750,000 | 715,000 ARB (~$1,200,000) |
| Admin Costs as % of Total Request | ~6.5% | 1.6% |
LTIP Pilot is meant to be over a smaller period of time, but it’s still even more grants money and the easiest comparison. What accounts for the several million dollars in additional overhead for Milestone 2? How can we bring those down to around 2-3% of the total spend?