Texas Tech University: Office of Research Services

Cost Sharing

Cost sharing has a significant financial impact on the department or college providing the funds and the University as a whole. A decision to cost share should therefore be carefully weighed. Commitments should be held to a minimum. The university's position is to provide cost sharing only when required by agency guidelines or delineated in specific program announcements or necessary due to the competitive nature of the proposal. Further information about the university's policy on cost sharing can be found in OP 65.08.

What is Cost Sharing?

Cost Sharing is that portion of total sponsored projects costs that are paid from sources other than the funds provided by the sponsor.

Some agencies make a distinction between cost sharing and matching. Generally, these terms refer to the share of costs not charged to the sponsor. These terms can refer to cash contributions, contributed time, and donated services.


Types of Cost Sharing

NOTE: In either case (voluntary or mandatory), when an award is received in which cost sharing was proposed, the cost sharing becomes a binding commitment which the university must provide as part of the performance of the sponsored project.

Federal Requirements for Cost Sharing

Federal regulations regarding cost sharing are found in OMB Circular A-110, Uniform Administrative Requirements for Grants and Agreements with Institutions of Higher Education, Hospitals, and Other Non-Profit Organizations.

Subpart C, Section .23 states in part; (a) All contributions, including cash and third party in-kind, shall be accepted as part of the recipients cost sharing or matching when such contributions meet all of the following criteria.

Unrecovered indirect costs may be included as part of cost sharing or matching only with the prior approval of the Federal awarding agency.

Documentation of Cost Sharing

Documentation is required for each proposal that requires cost sharing on the Internal Routing Sheet. The Principal Investigator will provide the source(s) of funding for cost sharing and get approval from the appropriate account manager(s). This form must represent all references to cost sharing found within the budget, budget justification or text of the proposal. If effort or other resources are offered in the proposal narrative or budget justification, the associated costs must be treated as cost sharing even if they are not quantified in the budget.

In accepting an award where the proposal indicated institutional cost sharing, the university is committing itself to formally documenting that the cost sharing was actually applied to the project. Principal Investigators (PIs) are responsible for seeing that the cost sharing commitments are met and providing appropriate documentation to the Sponsored Programs Accounting and Reporting (SPAR) office. The PI is responsible for obtaining appropriate documentation from the providers of third-party cost sharing. This documentation must be sent to SPAR.

Wording Proposals to Avoid Mandatory Cost Sharing

Example 1:

Do Not Use: Dr. I. Needa Grant will be providing five percent of his time to the project at a value of $4,321.

Do Use: Dr. I. Needa Grant will be providing expert advice and consultation to the project as needed.

Example 2:

Do Not Use: The University demonstrates support and will contribute to the multi-state project through partial salary for the project director.

Do Use: The University demonstrates support to the multi-state project through the availability and expertise of the project director.

Example 3:

Do Not Use: Dr. I. Needa Grant is Principal Investigator and will devote 40% effort (30% salary support requested) to the project.

Do Use: Dr. I. Needa Grant is Principal Investigator and requests 30% salary support to the project. He will provide additional support as needed.

Office of Research Services

Office of Research Services
349 Administration
Box 41035 | MS 1035
Lubbock, TX 79409-1035
(806) 742-3884 ofc | (806) 742-3892 fax