Federal Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards defines cost-sharing or matching as “the portion of project costs not paid by Federal funds or contributions.” Montclair State University applies this definition to both federal and non-federal grants and administers cost-share the same way regardless of sponsor type. Like other grant expenditures, all cost-share must be allowable, allocable, reasonable, and supported by documentation. Cost-share includes both institutional cost-share and third-party in-kind cost-share contributions that a recipient makes to an award:
- Institutional Cost-Share: Grant-specific costs not covered by the sponsor, which may include committed effort and fringe, supplies, travel, student workers, Graduate Assistantships, or services specifically purchased by the institution for the grant
- Third-Party In-Kind Cost-Share: Grant-specific costs not covered by the sponsor or the institution that are donated by a third-party entity, including committed effort, travel, supplies, space/rental costs, equipment
At Montclair State University, committed cost-sharing can be mandatory or voluntary, depending on the situation.
Some funding opportunities issue a requirement for cost-share in the application guidelines. Usually, this will be listed as a ratio or percentage for how much the institution is required to contribute. For example, a 1:1 ratio would mean that the institution must match every dollar that the PI/PD is requesting. Since institutions must meet this requirement, it is considered “mandatory” cost-share. As part of the proposal, applicants typically submit two budgets: one detailing the requested funds and one outlining the institutional cost-sharing funds. Because the cost-sharing funds are required in the funding opportunity (“mandatory”) and the recipient has included a budget in the proposal (“committed”), this is considered “mandatory committed cost-share.” The mandatory committed cost-share is a University obligation and represents a legal, binding commitment of the University. Once the award has been granted, the cost-share must be tracked and reported on all sponsor reports and audits.
Voluntary committed cost-share involves institutional funds that are not formally required as per a notice of funding opportunity but are committed by the institution in the proposal. Under the Uniform Guidance, Subpart D (§200.306) (effective 12/26/2014), voluntary committed cost-sharing in federal awards is not expected, and it cannot be used as a factor during the merit review of applications or proposals unless the agency has prior authorization. However, some funding opportunities from private sponsors will strongly recommend that the institution offer cost-share funds to make the proposal more competitive. PI/PDs and departments should refrain from making any cost-share commitments voluntarily, since the voluntary committed cost-share will be a University obligation and will represent a legal, binding commitment of the University upon award. Once the award has been granted, the cost-share must be tracked and reported on all sponsor reports and audits.
Any committed cost-sharing in a submitted proposal becomes a University commitment and represents a legal, binding obligation of the University once the award has been granted.
Cost-share must be thoroughly discussed and approved at the proposal stage. At time of award, cost-share must be confirmed with the relevant parties through the “cost-share commitment form.” This form must be approved before award set-up may take place. For direction on spending down the cost-share budget, please contact the Office of Grant Accounting.