The Cardano Budget Committee decided on April 21st to provide a recommendation to DReps regarding the polling threshold used to determine which proposals are included in the budget information action from Intersect.

A separate tool is being developed for budget reconciliation polling.  Gov.Tool polls will be used to help prioritize proposals, but will not be used to directly determine which proposals go into the budget info action. The poll to decide which proposals will be included in the budget will take place during reconciliation workshops on April 26-28 and May 3-4. The polling tool will be available asynchronously.  Polls during the first reconciliation cycle (April 26-28) will be used to generate a budget info action.  Any proposals not included in this budget can be carried forward to the May 3-4 reconciliation cycle for further consideration.

Recommendation from the CBC.  Proposals to receive treasury funding will be included in Intersect’s budget info action if:

Yes / (Yes + No) > 50% by DRep stake

Abstention and non-participating stake do not impact the calculation.

This recommendation is aligned with the >50% threshold required for a budget info action to pass.   It balances the need to build off-chain consensus on the 2025 budget, thereby improving the likelihood that it will pass, while not removing any decision-making authority from the DReps.  The CBC felt that the threshold can safely be set to >50% of the participating stake because two official decisions must still follow - an on-chain vote on the budget and on chain votes for each treasury withdrawal to distribute any of the funds earmarked in the budget. Treasury withdrawals only pass with a 67% approval of DReps.  The CBC also wanted to ensure that the threshold was not set so high that the community would have to complete many rounds of reconciliation with no comprehensive budget as an outcome, which would be detrimental to critical ecosystem activities.

In summary, this threshold will provide a strong indicator of what the community wants to see in a budget while not unnecessarily stalling progress or causing further voting fatigue in DReps.

What this means for proposals:

During each reconciliation cycle, proposals will be reviewed based on prioritization that reflects community sentiment gathered in Gov.Tools up until April 24th.  This summary and prioritization will be presented to DReps during reconciliation.  DReps will discuss prioritized proposals in each category and be asked to submit a poll with their opinion.  This poll will be in a new Hydra based voting tool.  If your proposal passes the above recommended threshold and specifies Intersect as the administrator, Intersect will include it in their budget info action.  

Two reconciliation cycles are planned for 2025.  If your proposal doesn’t pass the threshold in the first reconciliation cycle, this doesn’t mean your proposal isn’t suitable for the budget, or that it cannot be funded.   If your proposal is ideal for Cardano Treasury funding, the DReps are likely to review it in the second reconciliation cycle.  Alternatively, the DReps may determine that the proposal should be routed through a more suitable funding mechanism with built-in oversight mechanisms.  One familiar route could be Catalyst (pending DRep agreement to fund Catalyst in the 2025 budget) for small innovation proposals.  There are also several other proposals for treasury funding to create a secondary funding mechanism, such as the Builder DAO, RareEvo events, and Future Governance Workstreams proposals.  As with Catalyst, these proposals are pending DRep approval for funding; however, any successful proposals will provide additional avenues for funding.

Join us for reconciliation workshops to hear final questions and feedback on your proposals from DReps.  Register here: https://lu.ma/cardanobudgetprocess