1. Navigating theNavigating the
Shoals ofShoals of
Cost SharingCost Sharing
and Matchingand Matching
Gregory K. Schmidt, ManagerGregory K. Schmidt, Manager
Contract & Grant AccountingContract & Grant Accounting
Florida A&M UniversityFlorida A&M University
NCURA Region III - May 17, 1999NCURA Region III - May 17, 1999
3. Definitions per OMB A-110Definitions per OMB A-110
www.whitehouse.gov/wh/eop/omb/html/circulwww.whitehouse.gov/wh/eop/omb/html/circul
ars/a110/a110.htmlars/a110/a110.html
Cost Sharing or MatchingCost Sharing or Matching
– That portion of the project or program costs NOT borneThat portion of the project or program costs NOT borne
by the Federal Government.by the Federal Government.
Cash ContributionsCash Contributions
– Recipient’s cash outlay including 3rd partyRecipient’s cash outlay including 3rd party
contributions to the recipient.contributions to the recipient.
RecipientRecipient
– Organization receiving direct federal assistanceOrganization receiving direct federal assistance
4. Sorting the LinesSorting the Lines
All contributions accepted including cash and 3rd party in-All contributions accepted including cash and 3rd party in-
kindkind
IFIF
– verifiable in your recordsverifiable in your records
– are not included in another federally-assisted projectare not included in another federally-assisted project
– necessary and reasonablenecessary and reasonable
– allowableallowable
– not paid by the Federal Piratesnot paid by the Federal Pirates
unless allowed by their rulesunless allowed by their rules
– provided for in award budgetprovided for in award budget
– conform to other provisions.conform to other provisions.
ANDAND
5. Details - 1Details - 1
Verifiable in your recordsVerifiable in your records
– Account linked to sponsored accountAccount linked to sponsored account
– Cash receipts vouchersCash receipts vouchers
– Expenditure vouchersExpenditure vouchers
Not Included in Other Federal ProjectsNot Included in Other Federal Projects
– Expenditures unique to projectExpenditures unique to project
– Cannot be claimed on another projectCannot be claimed on another project
6. Details - 2Details - 2
NecessaryNecessary
– Must be related to the projectMust be related to the project
– Must be used by the projectMust be used by the project
AllowableAllowable
– Standard A-21 rules applyStandard A-21 rules apply
– If it isn’t allowable there, it isn’t here eitherIf it isn’t allowable there, it isn’t here either
7. Details - 3Details - 3
Not Paid by the FedNot Paid by the Fed
Fed cannot pay directly or indirectlyFed cannot pay directly or indirectly
– cannot claim as cost sharing and charge another fedcannot claim as cost sharing and charge another fed
accountaccount
– cannot charge cost sharing to indirect cost basecannot charge cost sharing to indirect cost base
In the BudgetIn the Budget
Proposal budgets detail the matchingProposal budgets detail the matching
Treat like fed fundsTreat like fed funds
– if you need approval, get itif you need approval, get it
Other ProvisionsOther Provisions
8. Unrecovered Indirect CostsUnrecovered Indirect Costs
May be included as part of matchingMay be included as part of matching
with prior approval.with prior approval.
– E.g..E.g..
Direct Costs 100,000.00$
MTDC Base 80,000.00
F&A Rate 52% 41,600.00
Charged 15% 12,000.00
Matching 29,600.00$
9. Contributions of Services &Contributions of Services &
PropertyProperty
YOUR contributions.YOUR contributions.
– Valued according to cost principlesValued according to cost principles
– E.g..E.g..
Salaries & wagesSalaries & wages
TuitionTuition
EquipmentEquipment
10. Contributions of Services &Contributions of Services &
Property - 2Property - 2
Buildings or lands.Buildings or lands.
– Must be authorizedMust be authorized
– Valuation shall be lesser of:Valuation shall be lesser of:
certified value of remaining life recorded in yourcertified value of remaining life recorded in your
records at time of donationrecords at time of donation
current fair market value.current fair market value.
– FMV may be accepted even if exceeds certifiedFMV may be accepted even if exceeds certified
value.value.
11. Volunteer ServicesVolunteer Services
Must be integral part of approved project orMust be integral part of approved project or
programprogram
Includes:Includes:
Rates consistent with similar work inRates consistent with similar work in
organization or in labor market.organization or in labor market.
Paid fringe benefits are allowable, but mustPaid fringe benefits are allowable, but must
be reasonable, allowable and allocablebe reasonable, allowable and allocable
Professional Technical Consultants
Skilled labor Unskilled labor
12. Donated EmployeesDonated Employees
Services provided by another institutionServices provided by another institution
or company.or company.
Allowable at their regular salary rateAllowable at their regular salary rate
plus benes, but NOT overhead.plus benes, but NOT overhead.
– Services in same skill classServices in same skill class
13. Donated suppliesDonated supplies
Includes:Includes:
Valued at fair market value at time ofValued at fair market value at time of
donation.donation.
- Expendable
equipment
- Office
supplies
- Lab
supplies
- Workshop
supplies
- Classroom
supplies
14. Donated equipment, buildingsDonated equipment, buildings
and landand land
Title must pass to recipient (you)Title must pass to recipient (you)
Total value may be claimed as matchTotal value may be claimed as match
– award purpose is to assist in acquisition ofaward purpose is to assist in acquisition of
equipment, buildings or land,equipment, buildings or land,
– award purpose is to support activitiesaward purpose is to support activities
requiring use of equipment or real propertyrequiring use of equipment or real property
only depreciation/use charges areonly depreciation/use charges are
allowable.allowable.
full value and fair rental charges may be allowable iffull value and fair rental charges may be allowable if
allowed in advanceallowed in advance
IF
OR
15. Valuing Donated PropertyValuing Donated Property
Determined by usual accountingDetermined by usual accounting
policies provided:policies provided:
– donated land or space doesn’t exceed fairdonated land or space doesn’t exceed fair
market or rental valuemarket or rental value
value determined by independent sourcevalue determined by independent source
– donated or loaned equipment doesn’tdonated or loaned equipment doesn’t
exceed fair rental valueexceed fair rental value
16. In-Kind ContributionsIn-Kind Contributions
Volunteer services are documented andVolunteer services are documented and
where feasible supported similarly towhere feasible supported similarly to
your employees.your employees.
Basis for determining personal service,Basis for determining personal service,
material, equipment, building and landmaterial, equipment, building and land
valuations are documented.valuations are documented.
17. Setting the PoliciesSetting the Policies
Federal Policy StatementsFederal Policy Statements
Other UniversitiesOther Universities
19. DOEDOE
Guide to Financial Assistance - CostGuide to Financial Assistance - Cost
SharingSharing
– ““In making the award and in itsIn making the award and in its
administration, contracting staff (DOE)administration, contracting staff (DOE)
should make sure that the award, anyshould make sure that the award, any
amendment(s), and/or communicationsamendment(s), and/or communications
clearly state the cost-share in dollarclearly state the cost-share in dollar
amounts rather than as percentages ofamounts rather than as percentages of
project costs, to avoid anyproject costs, to avoid any
misunderstanding regarding the amountmisunderstanding regarding the amount
(and limit) of the DOE financial(and limit) of the DOE financial
20. DOEDOE
Matching requirements in solicitation orMatching requirements in solicitation or
program rule.program rule.
– Minimum amount or percent of total costsMinimum amount or percent of total costs
If not in statute or program rule,If not in statute or program rule,
statement justifyingstatement justifying
– required levelrequired level
– waiver circumstanceswaiver circumstances
DOE considers program income, patentDOE considers program income, patent
rights and rights in data, NOT fee orrights and rights in data, NOT fee or
21. NSFNSF
Minimum 1% of project, orMinimum 1% of project, or
1% aggregate of all NSF-supported1% aggregate of all NSF-supported
projectsprojects
Match not required for:Match not required for:
International travel Construction, renovation
Research equipment Ship operations
Education, training Publications
Symposia Special studies
22. NSF - 2NSF - 2
1% match is not entered on budget (line1% match is not entered on budget (line
M).M).
In-kind matching is included on Line MIn-kind matching is included on Line M
– source, nature, amount discussed insource, nature, amount discussed in
budget narrative.budget narrative.
23. NSF - 3NSF - 3
GPM 332 “Significance of Cost SharingGPM 332 “Significance of Cost Sharing
Promises in Proposals”Promises in Proposals”
– “…“…[A] promise of cost sharing by a prospective[A] promise of cost sharing by a prospective
grantee may be a significant factor in NSF'sgrantee may be a significant factor in NSF's
funding decision and may be made a specificfunding decision and may be made a specific
condition of the grant.”condition of the grant.”
GPM 333.3a. “Cost Sharing Amount”GPM 333.3a. “Cost Sharing Amount”
– ““NSF expects that grantees will share in the costsNSF expects that grantees will share in the costs
at a level which reflects their interest in theat a level which reflects their interest in the
research, the potential benefits they may deriveresearch, the potential benefits they may derive
and their ability to cost share.”and their ability to cost share.”
24. NSF - 4NSF - 4
GPM 333.4.c “Cost Sharing Method”GPM 333.4.c “Cost Sharing Method”
– ““... the amount or percentage of cost sharing... the amount or percentage of cost sharing
need not be detailedneed not be detailed in specific projectin specific project
proposals or proposal budgetsproposals or proposal budgets , except if, except if
cost sharing is expected to be undertaken bycost sharing is expected to be undertaken by
claiming less than the approved indirect costclaiming less than the approved indirect cost
rate, which should be clearly stated in therate, which should be clearly stated in the
proposal budget.”proposal budget.”
25. PHSPHS
GPS 9505 - 6. Non-Federal Sources ofGPS 9505 - 6. Non-Federal Sources of
FundsFunds
– granteegrantee
– subgrantee or contractorsubgrantee or contractor
– 3rd-party in-kind contributions3rd-party in-kind contributions
affiliates not meeting 4 conditions outlined inaffiliates not meeting 4 conditions outlined in
chapter 7chapter 7
26. PHS - 2PHS - 2
Chapter 7 - Allowable administrativeChapter 7 - Allowable administrative
costs to affiliates - Conditionscosts to affiliates - Conditions
– charged for university-provided services.charged for university-provided services.
– State law prescribes how Federal reimbursementState law prescribes how Federal reimbursement
for university services costs are expended.for university services costs are expended.
Requires public official approve expenditures.Requires public official approve expenditures.
– agreement where university allows affiliate keepagreement where university allows affiliate keep
Fed reimbursement of university costs.Fed reimbursement of university costs.
– affiliate & university submit joint applications toaffiliate & university submit joint applications to
and is awarded jointly by PHS.and is awarded jointly by PHS.
27. PHS - 3PHS - 3
Allowability determinationAllowability determination
– 45 CFR Part 74 and 92 (allowability and45 CFR Part 74 and 92 (allowability and
documentation)documentation)
– 3rd party in-kind personal or real property3rd party in-kind personal or real property
needs approval.needs approval.
Valued at fair market or rentalValued at fair market or rental
may need to be valued by certified appraisermay need to be valued by certified appraiser
must be identified in budget proposalmust be identified in budget proposal
28. PHS - 4 Funding Cost SharingPHS - 4 Funding Cost Sharing
Any non-federal sourceAny non-federal source
– cash or in-kindcash or in-kind
– university or 3rd partyuniversity or 3rd party
Program incomeProgram income
– if expended for program goalsif expended for program goals
Patient reimbursementsPatient reimbursements
– Medicare, Medicaid, insuranceMedicare, Medicaid, insurance
Federal fundsFederal funds
– Legislative approval or Fed Fellowships.Legislative approval or Fed Fellowships.
29. PHS - 5 FundingPHS - 5 Funding
Cost Sharing Cont.Cost Sharing Cont.
Matching through Indirect CostsMatching through Indirect Costs
– Reduce the F&A charge to the grant forReduce the F&A charge to the grant for
allowable F&A.allowable F&A.
– May need to explain in Financial StatusMay need to explain in Financial Status
ReportReport
30. ConsequencesConsequences
Reduce grant proportionallyReduce grant proportionally
If proposed match exceeds requirementsIf proposed match exceeds requirements
– reduce awardreduce award
– reduce match requirement to mandatoryreduce match requirement to mandatory
Negotiated not metNegotiated not met
– reduce awardreduce award
– retroactive adjustment to lower level of matchretroactive adjustment to lower level of match
31. Health ServicesHealth Services
Delivery ProgramsDelivery Programs
Expectation to become independentExpectation to become independent
from PHS supportfrom PHS support
Develop plan to recoverDevelop plan to recover
– 3rd party revenues3rd party revenues
– Fed, State, local and private fundsFed, State, local and private funds
– charge care receivers according to abilitycharge care receivers according to ability
Bill for covered services and collectBill for covered services and collect
33. Getting CreativeGetting Creative
Negotiate institution-wide cost sharing.Negotiate institution-wide cost sharing.
– Generally a reduced F&A rate.Generally a reduced F&A rate.
– Another choice includes tuition.Another choice includes tuition.
Send proposals requiring match toSend proposals requiring match to
Foundations/Corporations for additionalFoundations/Corporations for additional
funding.funding.
– Expenditures on their accounts can be claimed asExpenditures on their accounts can be claimed as
matching.matching.
34. Getting Creative - 2Getting Creative - 2
Keep it simple and easy to document.Keep it simple and easy to document.
– Salaries, benefits, tuition, materials are easy toSalaries, benefits, tuition, materials are easy to
document.document.
Salaries & benefits through effort reportingSalaries & benefits through effort reporting
Tuition either as policy or by using separate accountsTuition either as policy or by using separate accounts
Materials through separate accounts with vouchersMaterials through separate accounts with vouchers
– CashCash
Cash received for servicesCash received for services
Donations with a letter for purposeDonations with a letter for purpose
– VolunteersVolunteers
Need pay rate and time sheetsNeed pay rate and time sheets
35. Avoiding trapsAvoiding traps
Remember NSF doesn’t require matchRemember NSF doesn’t require match
in budget, but if it’s in proposal body,in budget, but if it’s in proposal body,
they’ll take it and hold you to it.they’ll take it and hold you to it.
Matching F&A requires you to keepMatching F&A requires you to keep
track of it as an increase in the base.track of it as an increase in the base.
Avoid using buildings and equipment asAvoid using buildings and equipment as
match. Affects F&A recoveries.match. Affects F&A recoveries.
A referenced proposal is an includedA referenced proposal is an included
proposal.proposal.
36. Avoiding traps - 2Avoiding traps - 2
Avoid guaranteeing match.Avoid guaranteeing match.
– Suggest the possibility of graduate tuition,Suggest the possibility of graduate tuition,
but weasel the wording such that you’rebut weasel the wording such that you’re
not held to it. Students leave or graduate.not held to it. Students leave or graduate.
Engage the DepartmentsEngage the Departments
– Matching consumes real resources.Matching consumes real resources.
Develop clear policies and proceduresDevelop clear policies and procedures
