2. Copyright © Texas Education Agency 2012 1 Matching and Cost-Share Requirements Allowable Items and Accounting for Cost Share

3. Copyright © Texas Education Agency 2012 2 Matching or Cost Sharing Basics (34 CFR 74.23) Other federal funds may not be used to meet a matching or cost sharing requirement (unless otherwise permitted in the authorizing program statute – Even Start allows other federal funds for cost share) Costs must first be allowable costs under the grant program to be allowable to be counted toward cost share or match (the costs must also be obligated/expended during the same grant period) Costs used to count toward cost share or match may not be used to count toward cost share or match of another federal program

4. Copyright © Texas Education Agency 2012 3 Matching or Cost Sharing Sources Grantees must keep records of cost sharing or matching as if it were grant costs Can come from: – allowable costs borne by non-federal grants – grantee in-kind contributions – cash donations – third party in-kind contributions

5. Copyright © Texas Education Agency 2012 4 Matching or Cost Sharing Criteria Cash, grantee in-kind, and third-party in-kind contributions must be: – Verifiable from the grantee’s records – Not included as contributions toward any other federal program – Necessary and reasonable for proper and efficient accomplishment of the grant project – Allowable under the cost principles – Not paid by another federal grant unless specifically authorized in statute – Provided for in the approved budget (allowable under the grant)

6. Copyright © Texas Education Agency 2012 5 Indirect Costs as In-Kind Unrecovered indirect costs (when indirect costs are an allowable cost under the grant program) may be counted toward cost sharing or matching with approval of TEA (properly budgeted and approved in the grant application)

7. Copyright © Texas Education Agency 2012 6 Determining Value of In-Kind Contributions – Grantee in-kind contributions – Third-party in-kind contributions Services and property donated by others Volunteer services Services provided by employees from other organizations Donated supplies Donated equipment, buildings, or land

8. Copyright © Texas Education Agency 2012 7 Grantee In-Kind Contributions Whether the cost requires an actual cost outlay or not: – if a cost has value – if recognized under the applicable cost principles (OMB Circular A-122) – if an allowable cost under the grant it should be considered a grantee in-kind contribution. Ex: Office space, utilities, internet access, equipment usage, employee services, classroom space

9. Copyright © Texas Education Agency 2012 8 Grantee In-Kind Contributions Equipment owned by grantee – 6 2/3% of original acquisition cost Use of building space owned by grantee – 2% of original acquisition cost plus capital improvements (for the square footage used)

10. Copyright © Texas Education Agency 2012 9 Third Party Volunteer Services Services provided by professional and technical personnel, consultants, and other skilled and unskilled labor Count if the service is an integral and necessary part of the approved grant project Value at rate consistent with those paid for similar work in the grantee organization or in the labor market May include reasonable, allowable, and allocable fringe benefits

11. Copyright © Texas Education Agency 2012 10 Third Party Other Employees Employees of other organizations (“loaned” employee) Value at employee’s regular rate of pay (plus reasonable, allowable, and allocable fringe benefits) Excludes any overhead costs Must be for what employee is normally paid to do (same line of work)

12. Copyright © Texas Education Agency 2012 11 Third Party Other Employees If services provided by the loaned employee are in different line of work, value at same rate as volunteer for similar work. Ex: If a lawyer volunteers to drive a bus for grant activities, his time is valued at the rate of a bus driver, not the rate of a lawyer If he donates legal services to the grant project, his time is valued at his rate of lawyer

13. Copyright © Texas Education Agency 2012 12 Third Party Donated Supplies Non-capitalized equipment, office supplies, workshop or classroom supplies, etc. Value shall be reasonable and not exceed fair market value at time of donation

14. Copyright © Texas Education Agency 2012 13 Third Party Donated Use of Equipment, Buildings or Land If third party retains title and donates use of equipment or use of space in building, value at fair market rental rate of equipment or space

15. Copyright © Texas Education Agency 2012 14 Third Party Donated Equipment, Buildings or Land If third party donates equipment, buildings, or land and passes title to grantee, depends on purpose of grant. Purpose: – Acquiring capital (equipment, buildings, land) market value at time of donation – Operating grant (cannot claim cost of donated equipment, building, or land) Must use depreciation or use allowances based on market value of donation (6 2/3% of market value of equipment; 2% of market value of buildings or land)