The University of Texas at Arlington Office of Research and Office of Accounting

1. The University of Texas at Arlington Office of Research and Office of Accounting and Business Services Brown Bag Training Session VI: Cost Share Part One : The Problem

2. Cost Share Part One: The Problem • Definitions • Requirements for Cost Share • Types of In-Kind Cost Share • What Qualifies as Cost Share • What does not qualify as Cost Share • Why is Cost Share a problem

3. Definitions • What is Cost Share: • Program or project costs not supported by the sponsoring agency • Committed by an entity other than the sponsor

4. Definitions (cont) • Types of Cost Share: • Cash Match • In-Kind • Cost Shared F&A (IDC on cost-share amount) • Unrecovered F&A (Difference between UTA’s standard IDC rate and the rate allowed by sponsor) • Internal vs. External • Mandatory vs. Voluntary

5. Requirements for Cost Share • Mandatory (required by Sponsor) • Sponsor Policy (e.g. NSF 1% statutory on all unsolicited proposals) • Program requirements (details in RFP, solicitation) • NSF Major Research Instrumentation • THECB Technology Development & Transfer (ARP program)

6. Requirements for Cost Share (cont) • Voluntary (not required by Sponsor) • Voluntary uncommitted – Per A-21, key personnel on a Federal Research grant must show some form of effort towards the grant • UTA policy requires 1% of the total salary over the full project period for at least one key personnel • Internal tracking only – not in proposal

7. Requirements for Cost Share (cont) • Voluntary Cost Share in proposal becomes mandatory in award • NSF: Cost share is an eligibility criterion – not a review criterion

8. Requirements for Cost Share (cont) • Institutional “support” vs. cost share support can be provided without a cost share commitment • Dr. X will be available to consult on the project as needed (support) • Vs. Dr. X will devote 20% of his/her time to the project at no cost to the sponsor (commitment) • Dr. Y will have access to the deptartmental data frabulator (support) • Vs. The deptartment will purchase a $15k data frabulator for Dr. Y’s exclusive use in this project (commitment)

9. Types of In-Kind Cost Share • Equipment use or donation (FMV) • Supplies – donation (FMV) • Use or Service fees – reduced cost or donated (must be based on established or published rates for the entity providing the service)

10. Types of In-Kind Cost Share (cont) • Personnel Services or Consulting – reduced cost or donated services from an external entity must be valued at regular rate of pay plus fringe (no F&A) • Volunteer work – rate for service consists of similar services at UTA or in the labor market

11. What Qualifies as Cost Share • Integral and necessary to the project • Allowable as direct costs or unrecovered F&A • Based on established rates, or FMV • Used during project period & verifiable

12. What Does Not Qualify as Cost Share • Contributions committed to another Federal Program or paid from another Federally funded project (unless authorized by Federal Sponsor) • Salary above salary caps • Any cost not allowed as a direct cost • Leveraging of funds

13. Why is Cost Share a Problem? • High Audit risk • Verification nightmare • Many accounting methods and types of Cost Share • Requires extensive documentation from third parties • Fair Market Value Evaluations (Equip., Supplies and Services) • Must be part of Accounting Records • Extensive monitoring

14. Why is Cost Share a Problem? (cont) • Effect on Organized Research Base and F&A rate

15. Why is Cost Share a Problem? (cont) • Cost Sharing may occur without a commitment and must be accounted for in the Organized Research Base • Salaries paid over salary caps • Effort exceeds the amount paid on the grant account • Overdrafts • Consequences if Cost Share Commitment is not met: • Cost Share based on % of award • Breach of contract – pay back full amount of award • University will have to pay for the shortfall

16. Brown Bag Training Session • May – To be Announced • Cost Sharing Part Two