Zero-Based Budgeting (ZBB) Plan for Alaska
Purpose
To ensure that every dollar of state revenue is allocated efficiently, transparently, and in alignment with Alaska’s priorities by evaluating all programs and expenditures from a “zero base” each fiscal year. This reduces waste, prevents unnecessary spending, and strengthens accountability to Alaskans.
Goals
Scope
Process Overview
Phase 1: Executive Directive & Agency Preparation
Key Tools & Requirements
Purpose
To ensure that every dollar of state revenue is allocated efficiently, transparently, and in alignment with Alaska’s priorities by evaluating all programs and expenditures from a “zero base” each fiscal year. This reduces waste, prevents unnecessary spending, and strengthens accountability to Alaskans.
Goals
- Identify and eliminate inefficient, redundant, or low-impact programs.
- Prioritize funding for high-value programs that directly benefit Alaskans.
- Increase transparency in budgeting, enabling public insight into state spending.
- Create a culture of accountability across all state agencies.
Scope
- All state departments, agencies, and programs are subject to ZBB review.
- Focus areas: programs funded by unrestricted general funds, discretionary grants, and major state-supported initiatives.
- Exclusions: constitutionally mandated expenditures (e.g., PFD payouts) and debt service obligations.
Process Overview
Phase 1: Executive Directive & Agency Preparation
- Governor issues an executive order mandating ZBB across all state agencies.
- Departments appoint ZBB leads and form internal review teams.
- State Finance Department develops standardized templates for program evaluation.
- Each agency lists all programs, current budgets, outputs, and outcomes.
- Programs are scored based on:
- Alignment with state priorities
- Effectiveness and outcomes
- Cost per unit of service
- Legal or statutory requirements
- Agencies must justify each program’s existence and funding from zero, not based on previous year’s allocations.
- Agencies submit ZBB proposals to the Governor’s Budget Office with:
- Program description
- Objective and measurable outcomes
- Required funding for full operation
- Options for scaled or partial funding
- Governor’s Budget Office evaluates all programs statewide, prioritizes based on impact and efficiency, and produces a recommended budget.
- Present ZBB-based budget to the Alaska Legislature with detailed justifications for each program.
- Highlight eliminated or reduced programs, and provide rationale.
- Work collaboratively with the Legislature to adjust as necessary while maintaining the zero-based philosophy.
- Approved programs receive funding; departments must track outcomes against proposed metrics.
- Annual performance reports submitted to the Governor and Legislature.
- Savings from eliminated or restructured programs are reallocated to higher-priority initiatives.
Key Tools & Requirements
- Performance Metrics: Every program must define measurable outcomes tied to funding.
- Transparent Reporting: Budget documents published online for public access.
- Training & Support: Agency staff trained in ZBB methodology and performance evaluation.
- Technology Platform: Centralized system for tracking program evaluations, metrics, and reporting.
