Guidelines for Proposing Cost Sharing
- Background
- Definitions
- Proposing Cost Sharing Commitments
- Cost Sharing on Contract Proposals
- Proposing Project Personnel Effort (UCI-paid Salaries/Fringe Benefits) as Cost Sharing
- UCI Personnel as Collaborators
- Recording Cost Sharing on the Administrative Approval Form
- Eligibility Criteria for Shared Costs
- Costs Generally Allowed as Cost Sharing
- Costs Generally Not Allowed as Cost Sharing
Background
As a recipient of Federal funds, UCI is required to propose cost sharing in a manner consistent, and in accordance, with federal regulations. Therefore, it is important to understand UCI Research Policy - Cost Sharing on Sponsored Projects, which defines cost sharing and describes when cost sharing is appropriate and permitted. See Guidelines for Requesting Vice Chancellor for Research Cost Sharing for information about other resources.
Please note that these guidelines do not supersede UCI Research Policy - Cost Sharing on Sponsored Projects.
Definitions
UCI Research Policy - Cost Sharing on Sponsored Projects defines certain terms, including the following, which are restated below for the convenience of the reader:
- Cost sharing is any portion of the total costs of a project or program not borne by the sponsor. Cost sharing typically takes the form of in-kind resources (e.g., contributed project personnel effort) or cash.
- Cost sharing commitment means any cost sharing that is offered and quantified anywhere in a proposal.
- Cost sharing contribution means the use or expenditure of any in-kind resource or cash to fulfill a cost sharing commitment in the course of performing the scope of work under and extramural award.
Proposing Cost Sharing Commitments
If cost sharing is quantified in any part of a proposal that has been submitted to an extramural sponsor, a cost sharing commitment has been made and the administering department/unit is responsible for fulfilling the commitment in the event that the sponsor makes an award.
Cost sharing is considered quantified when UCI records, in conjunction with information contained in a proposal, are sufficient to calculate the amount of the cost sharing commitment. For example, if a proposal states that a researcher will contribute 10% of her time to a project during the first budget period, but her salary will not be charged to the award, then UCI has committed to cost share the dollar amount equal to 10% of the researcher's salary, plus associated fringe benefits. The dollar amount of the researcher's salary for the first budget period can be calculated using the information contained in the proposal, as well as payroll and personnel documents available to UCI.
Principal investigators and departments should refrain from making cost sharing commitments unless cost sharing is required by the sponsor or necessary to ensure the competitiveness of a proposal. Also, because cost sharing commitments involve increased administrative burden (associated with tracking/reporting shared costs) and are subject to audit, principal investigators, chairs, directors, deans and other UCI officials should carefully consider the cost effectiveness and the expected benefits of each cost sharing commitment prior to making such an offer.
Occasionally, the competitive nature of a funding opportunity may necessitate describing resources that are not eligible, allowed or offered as cost sharing, but will be made available to the proposed project/program. In such cases, these resources may be described as "resources available at no direct cost to the project" or "resources that will benefit the project". In addition, the proposal should not indicate or disclose the dollar value of any such resources. Examples of such resources include, but are not limited to:
- Equipment in the possession of UCI at the time a proposal is submitted to a sponsor or that will be in the possession of UCI prior to the effective date of an award;
- UCI-owned space; and
- Time and effort of collaborators serving solely in an advisory or mentoring capacity.
Cost Sharing on Contract Proposals
Because of the procurement nature of contracts, especially federal contracts, cost sharing commitments should not be made or offered in proposals that will lead to contract awards. However, it may be appropriate to make cost sharing commitments in proposals that will result in another institution issuing a subaward (e.g., subagreements or subgrants) to UCI where the prime award is a grant or cooperative agreement.
Proposing Project Personnel Effort (UCI-paid Salaries/Fringe Benefits) as Cost Sharing
UCI policy permits faculty members to devote a reasonable portion of their UCI-paid time and effort to accomplish their research projects. Therefore, the most appropriate cost sharing commitments/contributions are UCI-paid salaries and fringe benefits of faculty directly engaged in the project.
When offering project personnel effort as cost sharing, the proposed level of effort must be realistic (i.e., neither overstated nor understated) and reasonable (i.e., total percent of effort devoted to all sponsored projects and other UCI-related duties does not exceed 100%). In determining the appropriate level of cost shared effort, principal investigators must consider the following:
- the sponsor's requirement for cost sharing;
- the percentage of time spent on other sponsored projects;
- the amount of effort devoted to other functions such as teaching and public service; and
- the size of the project.
UCI Personnel as Collaborators
It is important to remember that quantifying UCI personnel effort anywhere in a proposal constitutes a cost sharing commitment. Therefore, if a project involves UCI personnel acting as collaborators, where such collaborators are and serving solely in an advisory or mentoring capacity and the department/unit does not intend to offer the collaborator's personnel costs as cost sharing, then the collaborator's effort should not be quantified.
Recording Cost Sharing on the Administrative Approval Form
When a proposal contains cost sharing commitments from multiple units, the unit submitting the proposal should confirm such commitments with the other participating departments/units. The "Cost Sharing Information" section of UCI's Administrative Approval may be used by chairs, directors, deans and vice chancellors to indicate approval of their respective commitments by applying their signature to this section of the form. Alternatively, memos or e-mail may be used to confirm and approve such commitments.
Eligibility Criteria for Shared Costs
The following eligibility criteria apply to all costs proposed (and ultimately accounted for) as cost sharing:
- the costs must be able to be documented and verified based on UCI's records;
- the costs must not be included as a cost sharing commitment related to any other project or program (i.e., the same costs may not be proposed as cost sharing for two or more projects);
- the costs may not be committed, or contributed, from another extramural award, except where specifically authorized by Federal statute or the sponsor (i.e., costs incurred under a NIH grant may not be proposed or accounted for as a cost sharing contribution under a NSF grant or any other federal or non-federal grant);
- the costs must be necessary and directly related to the project objectives;
- the costs must be incurred during the same performance period as the award supporting the project;
- the costs must be allowable and allocable under federal cost principles (OMB Circular A-21) and the terms of the sponsored agreement; and
- the costs must be identified in the approved budget or award (either directly or incorporated by reference) when required by the sponsor.
Costs Generally Allowed as Cost Sharing
- The effort of the principal investigator and project personnel devoted to the performance of an award, in the form of contributed salary, wages and fringe benefit costs;
- the acquisition cost of equipment necessary for the successful completion of the project;
- laboratory and project supplies necessary for the successful completion of the project;
- travel necessary for the successful completion of the project or for the purpose of reporting research results;
- other direct costs necessary for the successful completion of the project (e.g., purchased services, alterations or renovations necessary to conduct the project, equipment maintenance, the cost of setting up equipment necessary for the successful completion of the project);
- Facilities & Administrative costs associated with the direct cost elements proposed as cost sharing; and
- third-party contributions.
Costs Generally Not Allowed as Cost Sharing
- Administrative salaries, services and supplies, except when such costs will be incurred in the performance of a non-Federal award, or where special purpose or circumstances exist, which would allow for treating such costs as direct costs in accordance with OMB Circular A-21;
- salary costs above a regulatory cap (e.g., National Institutes of Health salary rate cap);
- general purpose equipment;
- equipment in the possession of the University at the time a proposal is submitted to a sponsor or that will be in the possession of the University prior to the effective date of an award;
- unallowable costs as defined in OMB Circular A-21, section J; and
- UCI facilities.
