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Cost Sharing
UCM APR #17 Policy Statement
Description. Cost sharing or matching represents the use of institutional funds to supplement project costs not borne
by the sponsoring agency. Cost sharing constitutes additional financial obligations for the university, thus, UCM
policy is to make cost sharing commitments only when required by the funder and then to cost share only to the
extent necessary to meet those requirements. All cost sharing must be reviewed and approved prior to proposal
submission by directors/chairs/deans/vice presidents (as appropriate) through the inclusion of the cost share on the
Office of Sponsored Programs Internal Routing Sheet as well as completion of the Office of Sponsored Programs
Commitment for Matching and Cost Sharing form.
Determining the acceptability of cost share and what sources can be used as cost share is the responsibility of the
Office of Sponsored Programs.
Cost Sharing Expenditures. All types of cost sharing expenditures are reportable and must be documented and
identifiable. All cash cost share will be transferred from its current university account into the sponsored program
account in order to facilitate the reporting and tracking of all project expenditures in one fund. All cash cost share,
including personnel salary and benefits, must be transferred as committed to the project.
PI/PDs are responsible for completing or acquiring all necessary documentation in order to appropriately budget cost
share items for a proposal including in-kind cost share if awarded. PIs are also responsible for obtaining any
necessary documentation of in-kind cost share from third parties.
Overview
Based on the Office of Management and Budget (OMB) Circular A-110, "Uniform Administrative Requirements for
Grants and Other Agreements with Institutions of Higher Education, Hospitals and Other Non-Profit Organizations"
(2 CFR 215), The Office of Sponsored Programs requires that all cost sharing on sponsored projects meet the
following criteria:
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Be verifiable from university records
Not be included as contributions for any other federally assisted project or program
Be necessary and reasonable for proper and efficient accomplishment of the project or program objectives
Be allowable under the applicable cost principles
Not be paid by the Federal Government or other sponsoring agency under another award, except where
authorized
Be provided for in the approved budget when required by the sponsoring agency
Conform to other provisions of A-110, as applicable
In order to meet the requirements of UCM policy and other federal, state, local and sponsor requirements, UCM will
create cost share accounts to provide accounting for cost share funds on sponsored projects. All cost sharing
expenses must be treated in a consistent manner in proposal preparation and in the financial accounting and
reporting to the sponsor.
Definitions
Cost Sharing (or Matching): The portion of project or program costs not borne by the sponsoring agency.
Mandatory Cost Sharing: Cost sharing required by the sponsor as a condition of the award.
Voluntary Committed Cost Sharing: Cost sharing that is not required by the sponsor but is voluntarily offered by the
institution, documented and quantified in the proposal and accepted by the sponsor.
Minimal Effort: Primary Individuals should include at least a minimum level of effort on a sponsored project. At a
minimum, a Primary Individual should include at least one percent (1%) of his/her time and effort on a sponsored
project for the period of performance.
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Voluntary Uncommitted Cost Sharing: A cost associated with the sponsored project and not funded by the funding
agency, which was not committed in the proposal or in any other communication with the funding agency.
Salary Cap: A limit or “cap” on the annual rate of salary reimbursement for a given amount of effort. The difference
between the reimbursed salary and the unreimbursed salary above a sponsor imposed salary cap will be considered a
mandatory cost share of effort.
In-Kind Contributions: Non-cash contributions provided by the university or third parties.
Individual: An Individual is any UCM employee who has Committed Effort (whether paid by the Sponsor or Cost
Shared) on a Sponsored Program. Where appropriate in this policy, the following subcategories will be utilized:
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A Primary Individual has some responsibility for the overall conduct and management of the research or
activity as described in the proposal/application or as identified in the Notice of Award of a Sponsored Program.
A Primary Individual is typically identified in the Sponsored Program Award as the principal investigator,
project director, co-investigator, or co-project director and typically, but not always, carries an academic (i.e.,
faculty) appointment.
The PI: In the Effort-Related Policies, when a duty or responsibility falls squarely on only one Primary
Individual, that individual may be referred to as The PI.
Effort: the amount of time spent on any activity for which an Individual is compensated by UCM. Effort is
expressed as a percentage of the Individual’s Total Institutional Activities, which Total Institutional Activities
typically include work on Sponsored Programs, teaching and instruction, service, or other duties for UCM. The
minimum effort every Primary Individual is required to expend on each of the Primary Individual’s Sponsored
Program(s), is generally at least 1%, either directly charged or cost-shared. The minimum effort and a PI’s actual
effort should be commensurate with his/her responsibilities. Exceptions to the minimum level of effort may be
permitted for equipment and instrumentation grants, doctoral dissertation grants, augmentation grants and special
institutional and training awards.
Roles and Responsibilities
Principal Investigator (PI)
 Ensures that any Cost Sharing found in his/her Sponsored Program proposal or application complies with this
policy;
 Clearly identifies Cost Sharing in proposals and includes in the narrative or other descriptive parts of the
proposals only Mandatory Cost Sharing or Cost Sharing that is approved and intended to become a binding
commitment on UCM;
 Works with his/her supervisor to obtain necessary approvals for Mandatory Cost Sharing and Voluntary
Committed Cost Sharing;
 Ensures Mandatory Cost Sharing and Voluntary Committed Cost Sharing on an Award is provided by either
UCM or a third party and is documented
 Works with the Office of Sponsored Programs to ensure that Cost Sharing is appropriately adjusted.
College/Department/Center/Institute
 Ensures all personnel are familiar with the Cost Sharing policy; and
 Commits funding, as appropriate, to meet Cost Sharing requirements.
Office of Sponsored Project and Research Integrity
 Advise Principal Investigators of cost sharing requirements; and
 Review proposals to assure cost sharing commitments are fully documented, all necessary approvals have been
obtained, and proposal commitments match the Cost Sharing/Matching Funds Request Form.
 Provides information necessary to PI and departmental staff for the administration of Cost Sharing
 In coordination with the PI, verifies that Cost Sharing funds are available and verifies the account number(s)
from which the funds will be transferred to a cost sharing account
 Identifies, monitors and tracks Cost Sharing to assure all requirements are being satisfied
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In conjunction with Grants and Contracts Financial Services, obtains documentation and certifications as
needed for reporting
Financial Services
 Set up cost sharing accounts and transfer funds;
 Notify PI of companion account numbers; and
 Report and certify cost sharing to funding agencies as required by award terms and conditions.
Procedures
Proposal Routing
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The PI, working with the Office of Sponsored Prgorams staff, must identify any Cost Sharing.
The PI must identify the source of funds necessary to support Mandatory Cost Sharing and Voluntary
Committed Cost Sharing. Commitments of Cost Sharing from a third party must be delineated and documented
in a Letter of Support issued by an authorized official who can legally bind the third party organization (e.g.
Company President or Non-Profit Organization Director.)
A Cost Sharing Form must be completed for all Mandatory and Voluntary Committed Cost Sharing identifying
all cost share commitments and source of funding.
In addition to approving Effort Commitments found in a PI’s proposal, the PI’s supervisors (dean, department
chair, Center/Institute director, and/or appropriate vice president) must review and approve the Cost Sharing
Form for all Mandatory Cost Sharing and Voluntary Committed Cost Sharing found in a proposal. Such
approval includes a review and approval of all funding sources identified to support such Cost Sharing.
Voluntary Committed Cost Sharing will not be allowed except in very rare situations where (a) the department
chair or Supervisor recommends it and supplies written documentation showing that such Voluntary Cost
Sharing is needed for the proposal to be competitive, (b) the dean or the supervisor of The PI’s Supervisor
recommends such Voluntary Cost Sharing to the provost and (c) the provost, or his/her designee, approves
such Cost Sharing. The supporting documentation, recommendations, and provost approval relating to
authorized Voluntary Cost Sharing shall be retained in the applicable Sponsored Program file retained by
Office of Sponsored Programs.
Post Award Monitoring
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At the time of award, the PI must ensure that the Cost Sharing amounts are still supported by the identified
funding sources and that the Cost Sharing amounts are appropriate, especially when the awarded budget is less
than the proposed budget.
Office of Sponsored Programs will request Financial Services set up the sponsored project account and the cost
share account.
Financial Services will set up the necessary cost share account(s) and transfer funds from the identified source
account(s) to the cost share account(s).
Upon account set up, Office of Sponsored Programs will provide a copy of the award documents to the PI and
request that all appointments and other relevant expenses be charged to the new cost share account(s) provided
by Financial Services.
Awards requiring cost share/match will not be processed until complete cost share information has been
received.
All PI/ PDs, with appropriate oversight from Office of Sponsored Programs, will ensure Mandatory Cost
Sharing and Voluntary Committed Cost Sharing is provided, tracked, monitored, and recorded in documents
that are retained for audit purposes.
Reporting/Closeout
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Office of Sponsored Programs will obtain certification of cost share/match from the PI, in accordance with the
sponsoring agency’s award terms and conditions.
Closeout of the companion account(s) will be processed at the same time as closeout of the sponsored project
account.
Forms
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Cost Sharing Form (xlsx)
Guidance on “Institutional Commitment/Support” in Grant Proposals
Sometimes it is necessary to provide institutional commitment/support language in sponsored project proposals,
either within the narrative of the application or as a letter attached to the proposal application. This guidance is
provided to faculty and staff as they develop such proposals, in the hope that this will speed and simplify proposal
development. This guidance also provides introductory thoughts, sample language, and a sample letter as examples
for future use. The first and most important item to note is that institutional commitment/support is not cost sharing
or matching. Cost sharing and matching are specific terms of art that are primarily differentiated by the use of
specific dollar amounts in the grant application (such as, “UCM will commit $50,000 in cash towards the delivery of
the project.”). Language reflecting institutional commitment and support does not provide specific dollars amounts;
it provides general statements of university support towards the project.
The differentiation between institutional commitment/support, on the one hand, and cost sharing, on the other, has
important implications for our indirect cost (F&A) structure. Increased cost sharing has the effect of reducing our
F&A rate that is subsequently negotiated with the U.S. Government. Down the road, this could reduce F&A
distributions. It is in our interest, then, to keep our F&A rate as high as possible, and one way to accomplish that is
by minimizing the usage of cost sharing except where it is mandatory or justified in compelling circumstances.
Examples of institutional commitment/support language include:
“The University will provide offices, labs, and administrative space as necessary for the
accomplishment of project deliverables.”
“UCM has several labs that will be utilized for the proposed research.”
“Administrative staff within the _____________ Department will be available to provide
support to the researchers conducting research in this project.”
“Several graduate students within the department will be providing basic research support
to the researchers during the life of the project.”
The main point here is to outline department/college/university support that will be available to
the project, without providing specific dollar amounts that could be construed as auditable cost
sharing by the sponsor.
2014 JP modified from University of Texas San Antonio Retrieved from: http://vpr.utsa.edu/osp/guidelines.php