Cost Sharing

Cost Sharing

Cost sharing means charging part of the costs of a sponsored project to a source other than the sponsor. A common university contribution is the cost of time that faculty members commit to the project but for which they do not charge the sponsor.

Sometimes a program requires cost sharing; e.g., large equipment awards.  This is known as required cost sharing. Occasionally it is clear that cost sharing is desirable even if not required. Such contributions are known as voluntary cost sharing, and usually take the form of time for people, e.g., faculty and staff release time. Voluntary cost sharing is not encouraged by the University and should be minimized whenever possible.

If cost sharing is included in a proposal to a federal sponsor and the proposal is funded, the promised cost share becomes a requirement of the award whether or not that requirement is specified in the award document. All cost sharing must be documented as having been provided. Some costs, such as supplies, do not lend themselves readily to documentation and audit, so using these items as cost share should be avoided if at all possible.

If a project does not recover F&A costs at the appropriate negotiated rate, the unrecovered F&A costs can be shown as cost share. Unrecovered F&A costs are computed by taking the difference between the F&A costs that the project should have recovered (calculated at the appropriate negotiated rate), and the actual amount of F&A dollars recovered.