Which statement best describes the end-of-year goal for Revolving Fund rates?

• A. Rates are designed to maximize revenue
• B. Rates designed to minimize year-end deficit
• C. Rates set to maintain a positive balance at year end
• D. Rates established to balance and typically aim for zero by year end

Answer: (D)

The end-of-year goal for Revolving Fund rates is to set charges so that total inflows cover total outflows, bringing the fund to a zero balance by year-end. This reflects the idea that the fund should be self-sustaining over the year and reset cleanly for the next cycle, with no leftover cash tied to past activities. By aiming for zero, charges are aligned with actual costs and no permanent surplus or deficit is carried forward, which supports clear accountability and proper annual closure.

Other approaches would create ongoing imbalances: maximizing revenue would leave a surplus, not what the fund is designed to do; minimizing a deficit could still leave some imbalance or obscure true costs; maintaining a positive balance would imply funds carried over unnecessarily. Ending the year at zero best matches the typical operating objective of a Revolving Fund.