Cost Sharing Overview

• Background
• Cost Share Process Overview
• PI/Staff Procedure/s
• References/Regulations
• Contacts

Background

Definitions

Cost sharing - Cost sharing is the portion of project or program cost not borne by the sponsor. It is the University's share of the cost of research. Cost sharing occurs when either a sponsor requires or the University commits funds beyond those awarded by the sponsoring agency to support a particular grant or contract. Cost sharing is primarily required by federal sponsors, and the obligation must be met using non-federal funds. Only charges that would be allowable as direct costs to the recipient grant are allowable as cost sharing. Federal flow through funds may not be used as a cost sharing source unless prior written approval has been received from both the federal sponsor and the flow through sponsor.

The "cost share" pledge may be either a fixed amount of money or a percentage of the project costs. The term "cost matching" often refers to cost sharing where the amount from the sponsor is equal to the amount from the cost share partner. This is also known as dollar for dollar cost sharing or cost matching.

There are three types of cost sharing:

• Mandatory(M): Cost sharing that the sponsor (typically a federal sponsor) requires as a condition of the award.
  • For example, if the total cost of a project is $150,000, the sponsor might award $100,000 and require that the University provide (or find an outside source to provide) the additional $50,000 from non-federal funding sources.
  • The sponsor may require the University to provide either a fixed amount of money or a percentage of the project costs as cost sharing.
  • The sponsor and the University agree on the terms of the mandatory cost sharing during the initial negotiation of the grant or contract and the conditions are written into the award.
• Committed(R): Cost sharing that the PI promises in the project proposal budget or the budget justification that is not required by the sponsor.
  • The University discourages cost sharing commitments when not required by the sponsor.
• Salary Cap(C): Cost sharing required of faculty who exceed the salary cap.
  • Salary Cap cost sharing is required by:
    • National Institute of Health (NIH)
    • Substance Abuse and Mental Health Services Administration (SAMHSA)
    • Agency for Healthcare Research and Quality (AHRQ)

Contribution Sources

• Are verifiable from the recipient's records;
• Are not included as contributions for any other federally-assisted project or program;
• Are necessary and reasonable for proper and efficient accomplishment of project or program objectives;
• Are allowable under the applicable cost principles;
• Are not paid by the Federal Government under another award, except where authorized by Federal statute to be used for cost sharing or matching;
• Are provided for in the approved budget when required by the Federal awarding agency; and
• Conform to other provisions of Circular A-110, as applicable.

The University typically may commit as cost sharing the following non-federal expenditures:

• Faculty salaries and related benefits: information on faculty cost sharing can be found on the Faculty Effort Certification.
• Non-Faculty salary and other contributions: information on non-FEC cost sharing can be found on the Non-FEC Cost Share Contribution Sources.

Process Overview

• PI--the principal investigator and/or a staff member with delegated authority
• Sponsor--the organization or person providing the grant/contract
• GCS--Grant and Contract Services
• GCA--Grant and Contract Accounting
• MAA--Management Accounting and Analysis
• NEA--Notice to Establish Account

PI/Staff Procedure/s

• Prepare and document the cost share pledge:
  • Read GIM 21
  • Contact OSP
  • Formula for Determining the Amount of Cost Share Committed
  • Complete GC1 Addendum
  • Contact OSP with any questions regarding the pledge
  
  
• When the budget is established, review the cost share pledge on the budget driver printouts that are sent to the department by GCA. If no changes are necessary, the printout should be retained for department records.
  • It is the Principal Investigator's responsibility to ensure that the cost sharing pledge on the grant or contract is correct and that it is met on schedule.
  
  
• On an ongoing basis, at least quarterly, during the life of the grant, review cost share activity using the Faculty Effort Certification System (BGT driver).
  • Viewing the Pledge:
    • in Administrative Applications open BGT.
    • choose option 6 (Faculty Effort Certification).
    • then, choose option 3 (Cost Share Inquiry Screen).
  • For individual faculty members:
    • place 9s in the date box.
    • insert the faculty member's ID number in the "ID" field.
    • enter the budget number to view activity on one budget, or
    • leave it blank to view all activity for this faculty member.
  • By budget (for budgets with multiple faculty and non-faculty, or with only non-faculty cost share):
    • place 9s in the date box.
    • leave the ID section blank.
    • insert the budget number.
  
  
• Report and document cost sharing on a quarterly basis:
  • Faculty Effort Certification
  • Reporting Non-FEC Cost Sharing
  
  
• Request a reduction or change in your cost share pledge:
  • Grant and Contract Accounting can change cost sharing information without an NEA only in the following situations:
    • when the effort of one faculty member is substituted for that of another faculty member and the overall dollar amount of effort is not reduced,
    • when a cost sharing pledge must be moved to a continuation budget (generally SNAP awards),
    • at expiration, if total amount of cost sharing pledged is based on a percentage of total expenditures and actual cost sharing funds equal that calculated amount,
    • when a faculty member wants to perform cost sharing in another quarter than that listed in the budget driver, if that quarter is within the grant period, or
    • when changes to a committed cost share pledge are requested. (However, reductions in overall mandatory cost share must be approved by Office of Sponsored Programs.)
  • Most changes to mandatory cost sharing pledges must be reviewed and approved by Grant and Contract Services. This includes increases or decreases to the percentage of funds pledged or to dollar amounts pledged. In addition, changes in overall anticipated effort by faculty must also be reviewed and approved by Grant and Contract Services.
  • After Grant and Contract Services reviews and approves a change to a cost sharing pledge, a revised NEA is issued with the revised cost sharing information and sent to Grant and Contract Accounting. Grant and Contract Accounting will update information in the Faculty Effort Certification System (BGT driver) based on the information included on the NEA.

References/Regulations

• UW Grants Information Memorandum (GIM) 21 - Cost Sharing Policy for Sponsored Agreements
• Office of Management and Budget Circulars:
  • A-21 - Cost Principles for Educational Institutions
  • A-110 - Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and other Non-Profit Organizations
• Faculty Effort Certification (FEC)
• Non-FEC Cost Share Contribution Spreadsheet (MS Excel)

Contacts

• are preparing your proposal or waiting to hear about a submitted proposal, contact Grant and Contract Services (GCS) via:
• email at gcsvcs@u.washington.edu
• phone at 206.543.4043
• have cost share questions on your award, contact Grant and Contract Accounting (GCA) via:
• email at gcaques@u.washington.edu
• phone at 206.543.8454
• have faculty effort questions on your award, contact Management Accounting and Analysis (MAA) via:
• email at suzette@u.washington.edu
• phone at 206.685.7395

Grant and Contract Accounting
A Department of Financial Management
gcaques@u.washington.edu
Modified: December 16, 2008