COST SHARING

1. COST SHARING Colorado State University Sponsored Programs Mary Atella Betty Eckert Candyce Jeffery Carmen Morales http://www.research.colostate.edu/policy/

2. Cost Sharing / Matching • Sharing of project costs by sources other than the Sponsor’s funds awarded in support of a project • More than a “token amount” (i.e. 1% required by NSF) • Normally on grants or cooperative agreements, NOT contracts • Types of costs: any allowable direct costs that benefit the project and are verifiable

3. Cost Sharing Criteria • A-110 (now also called 2 CFR 215) states that cost sharing must be: • verifiable in recipient’s records • not included as contribution for other federal projects • necessary and reasonable for project • allowable under applicable cost principles • not paid by the Federal Government on another award unless approved • provided for in approved budget when required by the federal awarding agency

4. Types of Cost Sharing • Mandatory Cost Share • Required by Sponsor as condition of award • Voluntary Budgeted Cost Share • Not required by the Sponsor, but becomes a legal requirement when included in Proposal budget • Strongly discouraged by University policy • Unbudgeted Voluntary Cost Share • Not quantified in the proposal • Reflects faculty effort during the academic year • No separate account is needed for tracking

5. Voluntary Budgeted Cost Share • PI annual salary is $120,000 • PI proposes (commits) 50% effort to project • Budget shows PI salary at $30,000 • PI certifies 50% to the project $120,000 x 50% = $60,000 Less paid from grant = ($30,000) Cost Share = $30,000 Cost share must be documented.

6. Unbudgeted Voluntary Cost Share • PI annual salary is $120,000 • PI budgets (commits) 50% effort ($60,000) to the project • PI certifies 60% effort to the project The 10% effort over and above the budget (commitment) is voluntary uncommitted cost share and does not require documentation

7. Leveraging Funds • Leveraging vs. Cost Sharing - Leveraging includes other associated programs related to proposed activity - May have separate scope of work, performance period, and budget - Described in narrative without detailed budget information, if possible; NOT shown as cost sharing or matching - Include statement in proposal to clarify leveraging is NOT cost sharing and will not be documented as such

8. Accounting for Cost Sharing • Creation of Dedicated (Companion) Accounts - Allows for separate/accurate documentation of contributed costs for inclusion on financial reports - Linked to sponsored project account • Creation of object codes within accounts

9. CSU’s Process for Creating Dedicated Accounts • Internal forms: • Proposal Approval Form (SP-1) (pre-award) • Institutional Commitment form (pre-award) • Request for Dedicated Account Form (post-award) • No account needed if only cost sharing F&A

14. Special Documentation in lieu of Dedicated Accounts Special documentation is needed at pre- and post-award stages for: • “Third party” contributions, cash or in-kind • Other institutional contributions • land, equipment, donated services, tuition differential, etc.

15. Unrecovered F&A • Use of unrecovered F&A requires prior approval of Federal sponsor • No separate account needed to document unrecovered F&A only • Reported to sponsor on financial reports when mandatory

16. NSF Cost Share • New policy on Cost Sharing: • 1% statutory requirement • no longer required on unsolicited proposals

17. NIH Salary Cap • Limitation of Salary Rate • Legislatively mandated • University Documentation • via dedicated cost share account

18. NIH Salary Cap--Example • Individual with 50% effort per month Annual base salary = $190,000 or $15,833.33/month Sponsor salary limit = $180,100 or $15,008.33/month University share = $ 9,900 or $825/month Actual salary = $ 7.916.67 for 50% effort/month Sponsor share = $ 7,504.17 for 47% effort/month Univ. share = $ 412.50 for 3% effort/month

19. USDA Joint Venture Agreements (JVA) • JVAs require cost sharing (80% Sponsor/20% Recipient) • F&A is not allowed for State Cooperative Institutions • USDA will allow unrecovered F&A to meet the match requirement USDA CSU Reimbursement Contribution Total Direct Costs $100,000 -0- 45% F&A Research Rate -0- $45,000 Total $100,000 $45,000

20. Monitoring of Cost Share Accounts • Department/College • transfers budget to cost share account • ensures that cost share commitment is met • expenditures should occur on an on-going basis during the life of the project • Sponsored Programs • monitors on routine basis, and • reports to Sponsor as required

21. Consequences of Not Meeting Cost Share • Total sponsor costs may be reduced • Possible termination of award, or • Could constitute a violation of the T&C of award so serious as to provide grounds for subsequent suspension or debarment (NSF)

22. Topics for Discussion • Please share with us the most unusual cost share you have provided. • Do you have faculty who are convinced that they will receive a more favorable score if cost sharing is provided? How do you handle this situation? • How do you handle “unplanned” cost-share created by over-expenditure? • Use of program income as cost-share? • Faculty volunteer services? • How do you document the 1% NSF statutory requirement?

23. COST SHARE SESSION Colorado State University Sponsored Programs http://www.research.colostate.edu/policy/