Solving the Matching Dilemma
Rochelle McCrea
Team Leader
and
Towana DeShazo
Grants and Agreements Specialist
Awards Management Branch
Office of Extramural Programs
Solving the Matching Dilemma
Topics Covered
1. Matching/Cost Sharing Fact Sheet
2. Requirements
3. Allowable and Unallowable Costs
4. Matching/Cost Sharing Funds FAQ’s
5. Matching/Cost Sharing Review (SCRI)
6. Matching/Cost Sharing Letters
7. Questions
Matching/Cost-Sharing Fact Sheet
When matching is required:
 The RFA contains details whether or not
matching/cost sharing is required.
 Matching funds may be cash and/or in-kind
contributions, or third-party contributions.
 Examples of qualifying matching contributions
may include direct costs such as: materials
and supplies, duplication or postage costs, and
staff time.
Matching/Cost-Sharing Fact Sheet
(Cont’d)
Third Party Matching—
 Any contribution to the project by an
organization other than the recipient.
 Matching should be explained in the other
direct cost section of the budget narrative.
Matching/Cost-Sharing Fact Sheet
(Cont’d)
 Cost sharing commitments by a 3rd party must
include letter signed by the contributing
organization’s Authorizing Representative
(AR) and counter-signed by the recipient
organization’s AR.
 This letter should also state whether the
matching is cash or in-kind. If letter is
submitted with the proposal, counter
signature by recipient AR will not be required.
Matching/Cost-Sharing Fact Sheet
(Cont’d)
Cash Contributions—
 The recipient’s cash outlay, including the outlay
of money contributed to the recipients by nonFederal third-parties. Some examples of cash
contributions are:
– The salary and fringe benefits of the grantee or
third-party employees in proportion to their
efforts under a project.
– The grantee’s cost to purchase items of
equipment to be used under a project.
Matching/Cost-Sharing Fact Sheet
(Cont’d)
In-kind Contributions—
 The value of non-cash contributions of
property or services provided by non-Federal
third parties, including real property,
equipment, supplies, and other expendable
property directly benefiting and specifically
identifiable to a funded project or program.
MATCHING/COST SHARING REQUIREMENTS
Third party cash and in-kind contributions:
 A separate pledge agreement for each
donation should be submitted on Donor
Organization’s letterhead.
 Signed by the AR of the donor organization
and the applicant organization.
 Include the title of the person signing as the
AR.
MATCHING/COST SHARING REQUIREMENTS
Third party cash and in-kind contributions:
 Agreement must include:
-The name, address, and telephone number of the donor.
-The name of the applicant organization.
-The title of the project for which the donation is made.
-The dollar amount or good faith estimate of the donation or
contribution.
-A statement that the donor will pay the contribution during
the grant period.
-The matching amount, the budget category for the match
and detail how the matching support, from each match, and
detail how the matching support, from each source, will be
used (e.g., salary and position supported)
MATCHING/COST SHARING REQUIREMENTS
(Cont’d)

The sources and amount of all matching from outside the
applicant organization should be summarized as part of the
Budget Justification.
 Grantee cash donations should be shown on the budget form
in the categories where it will be used (i.e., travel, salaries,
etc.) and explained in the budget justification for matching.

All third-party contributions should be shown on the budget
form in the other direct cost section; Other 1, Other 2, or
Other 3 categories and explained in the budget justification
for matching.
MATCHING/COST SHARING REQUIREMENTS
(Cont’d)
 The same level of details required to be provided for Federal
funds should be provided for any required matching/costsharing.
 Generally, any matching from the recipient is considered to be
cash. In-kind (non-cash) contributions usually consist of
property or services (i.e., donations of equipment, use of
facilities etc.).
The following table represents a sampling of generally allowable and unallowable costs. The list is not
exhaustive. Please see the referenced OMB Circulars and the Program Request for Application for more
information.
Allowable
Unallowable
Acquisition of non-fixed equipment for use on the project.
Planning, repair, rehabilitation, acquisition, or construction
of a building or facility (except were allowed by law or
statute).
Equipment use charges if part of Indirect Cost Rate base.
Equipment use charges if it is normal policy to charge as
a direct charge.
Salaries and Wages for paid workers for actual work
performed on the project.
Indirect Cost: for most programs awardee may charge up
to 22% of the Total Federal Funds Awarded or their
approved negotiated rate, whichever results in the lower
dollar amount in indirect costs.
Capital improvements-the use of Federal funds for
renovations or improvements to buildings, land, or
equipment is prohibited (except were allowed by law or
statute).
Any amount in excess of the allowed Indirect Costs.
Acquisitions & Supplies
Entertainment costs, memorabilia, incentives, etc.
Costs associated with education, training and outreach,
as long as the costs are related to the goals and objective
of the project.
Alcohol expenses
Matching/Cost Sharing Funds FAQ’s
1. Do we have to have all the required
matching resources secured prior to
issuing the award?
Yes, before the award may be issued, all matching
requirements of the program must be met.
Verification that all matching is secured must be
provided.
(Please note some matching may be deemed unallowable
during the review, and additional matching resources may
be required).
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
2. Can other Federal funds be used as
matching on this project?
No, matching contributions must come from
non-Federal sources unless funds from Federal
sources are specifically authorized by
Federal statute to be use as matching.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
3. Can funds provided from a state or local
government for another similar project be
used as required matching?
No, if the funds were provided specifically
for another project, they cannot be used
as matching for this project regardless of
similarities.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
4. If I anticipate receiving funds from other
sources in the future (i.e., weeks, months,
year,) may I count them as anticipated
matching costs?
No, all matching must be secured at the
time of award to be considered as a part of
the required matching. See Item #1 above.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
5. What are cash contributions?
A cash contribution means the recipient’s cash outlay,
including the outlay of money contributed to the recipient
by non-Federal third-parties. Some examples of cash
contributions are:
– The salary and fringe benefits of the grantee or thirdparty employees in proportion to their efforts under a
project
–The grantee’s cost to purchase items of equipment to be
used under a project
– Allowable Indirect Costs
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
6. What are In-Kind Contributions?
The value of non-cash contributions of
property or services, including real property,
equipment, supplies, and other expendable
property directly benefiting and specifically
identifiable to a funded project or program.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
7. What are the regulations on in-kind costs?
Grantees may refer to the NIFA website for 7 CFR
3019, USDA’s Uniform Administrative Requirements
for Grants and Agreements with Institutions of Higher
Education, Hospitals, and other Non-Profit
Organizations. This document, under Section
3019.23 – Cost Sharing or Matching, explains the
requirements for matching. This information also is
referenced in OMB Circular A-110, Subpart C, and
Section .23 of 2 CFR 215.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
8. What information should be included in the
pledge agreement letter?
a) authorized representative’s signature of the donor organization and
the applicant organization;
b) the name, address and telephone number of the donor;
c) the title of the project for which the donation is made;
d) the dollar amount of the cash or in-kind donation;
e) a statement that the donor will make the cash/in-kind contribution
during the grant period;
f) whether the applicant can designate the cash donation as they
deem necessary or whether the cash contribution has been
designated to a particular budget item by the contributor.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
9. If an item is unallowable for Federal
funds, may we use it as a matching cost?
No, if it is unallowable for Federal funds, it
would also be unallowable as matching.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
10. May we use equipment donated to our
organization several years ago?
No, the donation of equipment must be specifically
for the grant and provided within the project
period. The value of donated equipment must not
exceed the fair market value of equipment of the
same age and condition at the time of the
donation.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
11. May we use staff time as a matching
contribution towards the project?
Yes, but you must provide the hourly rate of pay
applied and the number of hours spent on the
project for each individual and the task to be
completed.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
12. Can a volunteer’s time be used as matching and
if so, how do we determine what value the time
has?
Volunteer services may be counted as cost share or
matching if the service is necessary to the project.
Costs should be consistent with those paid for similar
work in the recipient’s organization.
In those instances in which the required skills are not
found in the recipient organization, rates shall be
consistent with those paid for similar work in the labor
market.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
Fringe benefits may be included in the costs.
When an employer of another organization volunteers third
party contributions, these services shall be valued at the
employee’s regular rate of pay.
If including volunteer time, present the information in the
following manner - hourly rate of pay x the number of hours +
fringe benefits (if applicable) = the amount to be paid or the
value of volunteer time.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
13. May we include rent under the Federal funds to
help meet our matching requirement?
Yes, rent is allowable under both Federal funds and as
matching as long as the facility is not owned by the recipient
organization, and the rent is not included as part of the
organization’s indirect cost pool.
If rent is going to be applied as a direct cost item, it must be
applied on a pro-rated basis based on project usage.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
14. Do changes in matching funds such as the expenditures
made or the sources of matching funds after the award
has been made require approval?
No, once the grantee’s matching funds have been approved,
the grantee may make changes to their budget, including
matching funds, as long as they continue to meet their
required level of matching from non-Federal sources.
The matching contributions must be allowable, reasonable,
and allocable to the project. Accurate records of the matching
must be kept and reported during the period of the award.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
15. Can we use income that we will earn from
participants as matching funds?
If so, how do you recommend we document
this?
No, you will not be able to use the earned income towards
the match since all matching funds must be secured in
advance. The grantee must have a firm commitment of
matching funds before any Federal funds are awarded;
therefore, an anticipated amount of matching is not allowed.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
16. Can we use previously approved matching
funds in excess of required percentage of
matching for another program towards a
project?
No, it is not allowable to use previously approved
matching funds that are in excess of the required
percentage of matching for another program towards
another project. All matching funds are secured
specifically for a project and therefore cannot be
re-applied as matching for another project.
Matching/Cost Sharing Funds FAQ’s
(Cont’d)
17. Can the indirect costs be used as
matching funds?
Yes, normally, the applicant can claim any
combination of percentages on the Federal portion
and matching contribution on the budget as long
as the combined percentage does not exceed the
maximum indirect cost rate permitted by program
or the applicant may elect not to charge indirect
costs and instead use all grant funds for direct
costs, excluding Specialty Crop Research Initiative
(SCRI) projects.
Matching/Cost Sharing Review
Specialty Crops Research Initiative (SCRI)
The recipient of a grant under the Specialty Crop Research Initiative
must provide funds or in-kind support from non-Federal sources in
an amount that is at least equal to the amount provided by the SCRI
Program. There is no provision for waiver of this requirement.
Applicants may use both the unrecovered indirect costs associated
with the Federal Budget and the unrecovered indirect costs
associated with the Non-Federal Budget to meet their matching
requirements. However, indirect costs may not be recovered on thirdparty matching contributions.
The next slide is a SCRI matching indirect cost example. An applicant
is submitting an application with a total budget of $100,000 and their
negotiated indirect cost rate is 55 percent.
Matching/Cost Sharing SCRI Calculations
Federal Budget
Direct costs
$78,000
Indirect cost (allowable as
part of the Federal Budget*)
$22,000
Non-Federal Budget
$51,032
Unrecovered indirect costs
attributed to the Federal Budget
$20,900
Unrecovered indirect costs
attributed to the Non-Federal Budget
$28,068
Total Budget
$100,000
$100,000
This example assumes no capital equipment expenditures as part of the Federal Budget or
third-party matching contributions as part of the Non-Federal Budget.
*limited to 22 percent of the Federal funds requested
Matching/Cost Sharing SCRI Calculations
Federal Budget
Non-Federal Budget
100,000 (total funds)
22% (multiply)
22,0001
51,032 (direct costs)
55% (multiply)
28,0682
78,000 (Fed direct cost)
55% (multiply)
42,900
42,900
22,000 (minus)
20,9003
1Indirect
cost (allowable as part of the
Federal Budget)
2Unrecovered
indirect costs attributed
to the Non-Federal Budget
3Unrecovered
indirect costs attributed
to the Federal Budget
28,068
20,900
48,968 Total non-Federal IDC allowed
Matching/Cost Sharing Letters
(Cont’d)
Matching/Cost Sharing Letters (Cont’d)
Matching/Cost Sharing Letters (Cont’d)
QUESTIONS?