Time with Office of Sponsored Programs September 1, 2009 Topic: Cost Share

What Is It Cost Share – the portion of a project’s costs not funded by the sponsor. Types include: Mandatory – cost sharing required by the sponsor as a condition of award. Voluntary – not required by the sponsor, but has been offered in the budget or proposal narrative. THEREFORE, BECOMES A REQUIREMENT OF THE AWARD Once it is proposed and accepted, it is Committed and must be accounted for.

Myths Cost share: Dollars are not real dollars Has no affect on the University Can be met through unrecovered F&A Does not have to be documented Voluntary commitments do not have to be met The PI is more likely to receive the award if some voluntary cost share is committed. Unless Mandatory, don’t voluntarily commit to cost share! No impact on chances of getting award. Before cost share – make sure have approval from whomever’s resources using

Methods of Cost Sharing University Costs covered by the institution Documented in the financial system F/A Subcontractor required Verify appropriateness , resonableness Third Party – Other than University or Sponsor Services, Equipment or Materials Obtain a letter at proposal to quantify commitment Ensure proper documentation Certification from third party at award end PROPOSAL STAGE: Committed cost share must be approved. Evaluate for reasonableness for both the dollars and total cost, ability to meet and compared to existing commitments. Ensure all cost sharing is identified – direct or implied USE THE RUC FORM AND BUDGET TEMPLATE (HAND OUTS) AWARD STAGE: All mandatory and voluntary committed cost share must be accounted for in the Financial System. DURING LIFE OF AWARD: All cost sharing must be Verified, recorded, and reported-monitored at least quarterly-properly documented Effort reports include cost sharing will be recorded with 0000 fund code tied to same project CLOSEOUT OF AWARD: Reported in final financial report. Ensure all cost sharing is allowable, properly documented and met for both mandatory and voluntary

Compliance Requirements Cost sharing must be: Allowable as a direct cost Incurred during the award period Necessary and reasonable for the award Verifiable from the University’s records Counted one time Federal $ cannot be used to match Federal $

Straight From the Sponsor “No expectation that proposals will include a cost sharing component…Solely at discretion of the institution…Once proposed and accepted, commitment becomes legally binding and subject to audit.” Per NSF Guidelines Chapter II, Part D. “Construction grants generally require the grantee to share in the costs of the project…the grantee’s match is usually at least 50 percent of the total allowable project costs…NIH generally does not allow grantees to use the value of third-party in-kind contributions as a source of matching.” Per NIH Grants Policy Statement – Part 9 - Matching “Otherwise, unless there is specific statutory authority, Federal funds may not be used to cost share…Source and amount of costs and/or value of third party cost share must be identified in the application.” Per HHS Grants Policy

Requirements OMB Circular A-110 – Administrative Requirements, subpart C.23. OMB Circular A-21 - Cost Principles for Educational Institutions – J.10. Effort Reporting UM System - APM 60.30 – Cost Share Sponsor Guidelines Sponsor’s requirements What can/not cost share Flexibility in CS unallowable items Reporting requirements Tracking (e.g. 1:1 match, or matching in total by end of award

Questions for OSP