Cost share
Definition of cost share
Cost sharing means charging part of the costs of a sponsored project to a source other than the sponsor. If cost-sharing is offered in any part of the proposal, it is a binding commitment that must be met and documented.
Ohio State and the College of Public Health discourage voluntary cost share unless the funding opportunity announcement (FOA) has language suggesting that the cost share may influence the proposal review. Note: cost share is a real expense and the source for the expense must be identified in advance. The PI’s division chair, ADR, and assistant dean for finance and administration must review and approve any proposal with a cost share before its submission to the funder. If prior approval is not secured, the award is unlikely to be accepted.
Types of cost share: Required and voluntary
Required cost share occurs when a portion of the costs for the project are required per the sponsor’s FOA to be committed and paid for from another funding source other than the sponsor or the sponsor states that certain costs are disallowed but unavoidable. An example of unavoidable disallowed costs could be portions of fringe benefits, tuition and minimum stipend rates required by Federal Labor Standards Act. The PI must secure the required cost share funding from other sources to meet the requirements of the FOA.
Voluntary cost share occurs when the sponsor does not require a portion of the project costs to be committed and paid for from another source in the FOA, but the PI voluntarily proposes a portion of the costs to be committed and paid for from another source. Sometimes, voluntary cost share is proposed because it is deemed as giving the proposal a competitive advantage. The PI is required to discuss voluntary cost share with the division chair, ADR, and assistant dean for finance and administration. The source of funds for the cost share commitment must be identified and approved in advance.
Sources of cost share
Allowable cost share costs are readily verifiable in Ohio State’s records and are also allowable as a direct cost on the project. Some common examples are effort of the PI and other key personnel, including fringe benefits, graduate student tuition and fees, purchase of equipment, readily identified supplies and services, associated facilities and administrative costs, unrecovered facilities and administrative costs and third party contributions.
Any cost that would be unallowable as a direct cost to the project would also be unallowable as a cost share cost. Examples of unallowable costs are expenses that occur outside of the project start and end dates, costs not associated with the scope of work, expenditures that are included in Ohio State’s federally negotiated facilities and administrative rate and use of Ohio State facilities. Ohio State facilities may be an allowable cost if there is an approved facility usage rate.
Any cash or in-kind cost share commitments that are coming from outside of Ohio State. For example, an industry partner may offer a cash cost share commitment to be included in a proposal to meet the required cost share match requested in the FOA.
Allowable and unallowable types of cost share
Allowable cost share costs are readily verifiable in Ohio State’s records and are also allowable as a direct cost on the project. Some common examples are effort of the PI and other key personnel, including fringe benefits, graduate student tuition and fees, purchase of equipment, readily identified supplies and services, associated facilities and administrative costs, unrecovered facilities and administrative costs, and third party contributions.
Any cost that would be unallowable as a direct cost to the project would also be unallowable as a cost share cost. Examples of unallowable costs are expenses that occur outside of the project start and end dates, costs not associated with the scope of work, expenditures that are included in Ohio State’s federally negotiated facilities and administrative rate, and use of Ohio State facilities. Ohio State facilities may be an allowable cost if there is an approved facility usage rate.
Requesting, approving and documenting cost share
If the FOA refers to cost share, the director of research support or grants manager provides guidance to the PI regarding whether the specific cost share is required or voluntary, the process of securing the required approvals, and drafting a budget that includes the cost share. Typically, investigators in CPH and other units, possibly including external collaborators, are expected to assist in meeting the cost share expectations in the FOA. The PI may ask the grants manager for assistance in drafting the email request for approval from CPH. The email request, which should specify the FOA and include the draft budget, is sent to the division chair, ADR, and assistant dean for finance and administration for approval.
If approved, the assistant dean for finance and administration emails documentation of the approval, which is to be included in the proposal and attached to the ePA005 together with the approved budget. The cost share must be documented on the ePA005 in the cost share section by checking the source(s) of the cost share and listing the amount(s).
Expensing cost share commitments in Ohio State's financial system
If any cost sharing is included in a proposal (required or voluntary, in-kind, cash, or third party), 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 by the end of the project period. It is best to expend cost share commitments in real time with the project in the same manner as expenses to the sponsor. The grants manager can provide guidance to the PI to ensure cost share expenditures are reflected in the project financials and that all cost share contractual obligations are met.