This document provides an overview of cost share requirements for USAID-funded projects. It defines cost share as a portion of project costs not borne by the US government. It outlines rules for cost share contributions and provides examples of acceptable cash and in-kind contributions. The document emphasizes the importance of thorough documentation for all cost share. Contacts are provided for questions related to identifying, tracking, and documenting cost share for the LMG project.

1. Stronger health systems. Greater health impact.
Cost Share 101
Definitions, Ideas, and Implications for LMG
April 2012
Management Sciences for Health 1

2. Objectives of This Cost Share Webinar
 The first in a series of cost share webinars
 Explain the concept of cost share as used on U.S.
Government (USG) projects
 Provide practical guidance for identifying and
documenting cost share
 Provide information on cost share tools
available to the LMG Team
 Provide information about roles and
responsibilities on the LMG project
regarding cost share
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3. Cost Share in USAID Agreements
Definitions
 A requirement for USAID-funded cooperative agreements
and grants
 Cost sharing or matching refers to a portion of project or
program costs not borne by USG
References:
 Office of Management and Budget (OMB) Circular A-110: definitions
of terms
 Code of Federal Regulations (CFR) 2 CFR 215.23: guidance on
valuation methods for in-kind contributions
 22 CFR Part 226 “Administration of Assistance Awards to U.S. Non-
Governmental Organizations”, Section 23, and “Mandatory Standard
Provisions for U.S. Nongovernmental Recipients”
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4. What is Cost Share?
 Cash contributions - money from foundations or
companies; donations, grants, buy-in from other
donors or organizations with non-USG funding.
 Documented and tracked in US Dollars.
 In-kind contributions - resources other than money
that cover costs that would have been paid for with
USG project funds, had they not been covered by the
in-kind support.
 Examples: volunteer services, loaned equipment or space,
donated supplies, land, buildings, seconded staff paid by a
partner, donated health products, and more.
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5. What are the Rules about Cost Share?
All contributions, including cash and in-kind, shall be
accepted as part of the cost sharing or matching when
such contributions meet all of the following criteria:
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 achievement
of project objectives
Are allowable under the
applicable cost principles
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6. Cash Contributions
 Funding from non-USG sources
 Documented and reported in USD
When you receive a cash contribution:
 Obtain written verification (letter) from the donor stating clearly the
amount of the cash contribution and its purpose
 Acknowledge receipt of the contribution in writing
 Document currency conversion calculation at the time the
contribution was made
 Document exchange gain or loss, if relevant
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7. In-Kind Contributions
 Sometimes the only contribution a partner can make
 Demonstrate partner contributions and commitment
 Provide the true total cost of a project, when factored in
as part of a project budget
Important:
 All financial records pertaining to a cash or an in-kind
contribution should be retained for three (3) years from the
date of submission of the financial report in which the
contribution was reported.
 Reasonableness of the contribution’s value: what would the
donated item /service have cost if the project had paid for it?
Use fair market or fair rental value!
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8. Types of In-Kind Contributions: Labor
Category Examples Valuation Ideal Acceptable Unacceptable
Documentation Documentation Documentation
Employee of GTZ employee Rate: valued at the A paystub or copy of Organization's salary Biodata
another donating time, employee's regular paycheck or current scale or Salary surveys
organization University of Tanzania rate of pay plus copy of a contract or FSN scales or MSH
employee donating fringe benefits stating employee's pay scale for similar
time exclusive of OH rate skill set & activity or
provided that these other donor salary
services are the scale
same skill for which
the employee is
normally paid
Quantity of A work log/timesheet Letter stating hours Timesheet or letter
Time (LOE) itemizing hours spent spent on activity missing one or both
on activity signed by signed by employee & signatures
employee & supervisor/activity
employee's supervisor manager
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9. Types of In-Kind Contributions: Labor
Category Examples Valuation Ideal Acceptable Unacceptable
Documentation Documentation Documentation
Independent Consultant donating Rate Copy of a Salary surveys or FSN Biodata
Consultant - full time for an activity current/recent scales or what MSH
rate contract for similar has paid for similar
work which lists rate work before or other
(daily/monthly/yearly) donor salary scale
Quantity of A work log/timesheet Letter stating hours Timesheet or letter
Time (LOE) itemizing hours spent spent on activity missing one or both
on activity signed by signed by consultant signatures
consultant & & supervisor/ activity
supervisor/activity manager
manager
Independent Consultant providing Usual Rate minus Copy of a Salary surveys or FSN Biodata
Consultant - service/working at a discounted rate = current/recent scales or what MSH
discounted rate reduced rate cost share amount contract for similar has paid for similar
work which lists rate work before or other
(daily/monthly/yearly) donor salary scale that
and letter stating the documents the usual
discounted rate rate
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10. Types of In-Kind Contributions: Labor
Category Examples Valuation Ideal Acceptable Unacceptable
Documentation Documentation Documentation
Volunteers drivers, community Rates consistent Salary surveys or FSN Biodata
health workers, with those paid for scales or MSH pay
construction similar work in the scale for similar skill
recipient's organization set and activity or what
or in the labor market MSH has paid for
in which the recipient similar work before
competes for the or other donor
kind of services involved salary scale
Quantity of a work log/timesheet Timesheet or letter
Time (LOE) itemizing hours spent on missing one or both
activity signed by volunteer signatures
and supervisor/ activity
manager
No Volunteer Type of Activity Work Dates No of work Volunteer
Name days Signature
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11. Types of In-Kind Contributions:
Supplies and Materials
Category Examples Valuation Ideal Acceptable Unacceptable
Documentation Documentation Documentation
NEW Expendable equipment, fair market value of Copies of receipts quotes from Letter stating
office supplies, laboratory the property at the for donated vendors or receipts prices of donated
supplies, workshop supplies time of donation supplies for similar items supplies
purchased recently
or current
advertisements
Supplies
ON HAND Expendable fair market value of quotes from Letter stating
equipment, office supplies, the property at the vendors or prices of donated
laboratory supplies, workshop time of donation receipts for similar supplies
supplies items purchased
recently or current
advertisements
NEW training materials, fair market value i.e. see Labor
presentation materials, manuals value of the time
invested in producing
materials
ON HAND training materials, Fair market value of quotes from
Materials
manuals training materials & vendors or
manuals at the time receipts for similar
of the donation items purchased
recently or current
advertisements
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12. Types of In-Kind Contributions: Equipment
Category Examples Valuation Ideal Acceptable Unacceptable
Documentation Documentation Documentation
NEW audio-visual fair market value of quotes from vendors or
equipment, equipment at the time receipts for similar
photocopiers, lab of donation items purchased
equipment recently or current
advertisements
Equipment USED audio-visual fair market value of quotes from used quotes on new
equipment, equipment the same equipment vendors or equipment and written
photocopiers, lab age and condition at receipts for similar calculation of
equipment the time of donation items purchased depreciation or
recently or current depreciation table
advertisements
Vehicles, Rate: fair rental value quotes from equipment Letter stating the
photocopiers, leasing vendors or number of
refrigerators, receipts for like items days/months/
motorcycles, rented recently or years
bicycles advertisements Equipment
Loaned Quantity Letter stating the
Equipment is loaned not
number of signed
days/months/years
equipment is loaned
signed by authorized
official of loaning entity
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13. Types of In-Kind Contributions: Space
Category Examples Valuation Ideal Acceptable Unacceptable
Documentation Documentation Documentation
Space Workshop Rate: fair rental Independent appraisal of Quote from other
meeting room, value of comparable space and rental space vendors
office space comparable space facilities in a privately- or recent lease
owned building in the agreement for
same locality comparable space
Quantity Letter stating the number Copy of the lease Letter stating the
of days/months/years agreement that number of
donated signed by clearly states days/months/
authorized official of dates of rental years donated
donor entity not signed or
lease agreement
that shows no
dates
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14. Types of In-Kind Contributions: Training
Category Examples Valuation Ideal Acceptable Unacceptable
Documentation Documentation Documentation
Participant per Training days, Other donor per Official document Official document
Participant diem partially site visit days, diem rates or CLM with training title, with training title,
Training or fully paid study tour days local per diem venue, locality & venue, locality
for by rates dates and a list of & dates and list
another participants, amounts of participants
organization given to each for per and per diem
diem and participant rates used
sign off that funds
were received
Participant Cost of Fair market value on Official document Official document
travel partially transportation airline/bus/train with training title, with training
or fully to and from tickets, other donor venue, locality & title, venue,
paid for by home, to and transportation dates and copies of locality & dates
another from hotel to reimbursement transportation and list of
organization training venue, rates or LMG local receipts (airline participants
site visits transportation rates tickets, bus, taxi ) and amounts
for each participant given to each
for transportation
and participant
sign off that funds
were received
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15. Documentation Requirements
 The basis for determining the valuation for personal services,
material, equipment, buildings and land shall be documented
 Examples of back-up documentation:
 Donation letter / statement of costs that show the type of
donation, value and frequency from a donor
 Copy of bank statement (for cash contributions)
 Time and efforts sheets / forms signed by supervisors
 Rate calculations
 In-kind receipts / voucher forms
 Valuation of donated goods and use of space
 Independent appraisals (for donated
equipment, buildings or land)
 Federally approved Indirect Rate Agreement
(for US-based contributors as applicable)
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16. LMG Cost Share Tools and Templates
List of LMG Cost Share Reference Documents
Partner Profile Form
Cost Share Plan Template
Cost Share Guidance
Cost Share Tracker
Samples of MOU templates, receipt letter for cash
contributions, and volunteer time sheets
LMG forms, templates and quarterly reports will be stored
and accessible via Central Desktop
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17. Cost Share Examples
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18. Non-USG Funded Projects as Cost Share
 It is possible to leverage non-USG funded projects
implemented in the LMG countries as cost share, if:
 Their objectives are relevant to the LMG objectives
 Evidence, knowledge, tools, methodologies, and networks from
these projects can be utilized to further LMG objectives
 Non-USG funded research activities can inform
LMG strategies and approaches or vice versa
 No other USG-funded
project claims the
same cost share
 The value added of
the non-USG project
is quantified according to USG
guidance and attribution can be
reasonably claimed
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19. Cost Share Examples
Events / Publications / Media / Marketing
 Co-sponsorship of project events, publications
 Transportation and accommodation costs coverage
 Support for the LMG web portal
 Development / upgrades of IT solutions, platforms for knowledge
exchange, sharing, etc.
 Pro bono public relations services, filming, production of
documentaries, testimonials
 Contribution of air time, media buying services, product placement
 Pro bono development of branding and marketing plans for products
developed by a LMG partnership
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20. Cost Share Examples
Access to Specialized Skills
 Pro bono technical assistance as needed (access to specialized
skill sets that LMG may not have on staff in the US or in the field)
 Audit (financial management of partnership funds,
verification/validation of cost share reports in the field)
 Specialized training
 Marketing and PR
 Specialized research skills, costing and modeling skills, etc.
 Secondment of partner staff (pro bono, at discounted rates, etc.)
Access to Partner Networks
supply chain, communication, transportation, diaspora, and
others
Access to Products
health and others
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21. MSH Cost Share Contribution Examples
 Updated existing training curricula and products provided as
contributions to a partnership (cannot be funded by USG funds)
 Provision of services for a fee (related to LMG objectives)
Solutions to partner challenges:
 Gender sensitivity or gender empowerment courses for hotel chains,
garment factories, tea plantations (large female workforce)
 Assistance to the improvement of training curricula for academic
institutions and other partners (MOHs, professional associations)
 Mentoring programs for women networks
 Community engagement programs for extractive industry partners
 Partnership brokering, facilitation, and management (partnership units,
secretariats)
 Business development – developing concepts, proposals for
non-USG funds to further LMG objectives
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22. Why is Cost Share Important to LMG?
 A contractually mandated deliverable – 20% of
obligated LMG Core and Field Support funds
 An opportunity for MSH and partners to demonstrate
commitment to and ensure sustainability of project
investments
 An obligation that, if not met, will result in a reduction in
the amount of USAID incremental funding in the
following period or require MSH to refund the difference
to USAID, if the award has expired or has been
terminated.
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23. LMG Contacts for Cost Share Questions
 Cost share opportunities identification, brainstorming,
development of cost share plans, tracking
 Albena Godlove, Director, Global Advocacy and Partnerships, LMG
AGodlove@msh.org tel.: 703 310 3469
 Eva Ros, Senior Technical Advisor, Global Advocacy and
Partnerships, LMG
ERos@msh.org tel.: 703 310 3474
 Cost share documentation review, approval, tracking,
contractual and compliance questions
 Peter Mahoney, Senior Contracts Officer, MSH
PMahoney@msh.org tel.: 617 250 9332
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24. Bottom line
Leveraging the LMG Project Cost Share is
a Team Effort
What is on your mind?
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25. Stronger health systems. Greater health impact.
Saving lives and improving the health
of the world’s poorest and most vulnerable people
by closing the gap between knowledge and action in public health.
Management Sciences for Health 25