What type of budget methodology is used in the Auxiliary Trust Fund?
The Auxiliary Trust Fund is based on a zero-based budgeting methodology (ZBB). Under this type of system, departmental units should use their historical actual performance as a reference to estimate next fiscal years revenues and expenditures. Historical actual expenditures are used as a base when requesting budget authority for a given fiscal year. Requested increases beyond the historical years using an assigned threshold percentage (ex. 10%) are required to be supported by documentation that fully explains the reasons for the requested increases. The ZBB methodology is used in the Auxiliary Trust Fund since past performance is no guarantee of future results. In other words, it is possible to have a stellar year followed by a less prosperous one.
