Proposals and Cost Share

Proposal Preparation & Submission

Principal Investigators (PIs) must contact their Proposal Analyst as soon as it is determined that cost share is required for proposal submission. In addition to budgeting appropriately for cost share according to sponsor and University policy (see details below), a Cost Share Addendum must be completed and signed by all appropriate parties prior to submission. An incomplete Cost Share Addendumforces a hard proposal stop, putting a proposal at-risk of not being submitted.

Definitions

Cost sharing and Matching are terms that are often used interchangeably and identify the financial or in-kind support contributed by CU Boulder (or third parties through the University) to sponsored projects.

Committed Cost Sharing is a pledged commitment within any proposal document, including in the proposal budget, budget justification, letter of support/commitment, or proposal narrative whenever a specific dollar amount is stated or can be calculated from information provided in the proposal. CU Boulder considers quantified cost share pledged in proposal documents as committed regardless of sponsor award or reporting requirements. There are two types of Committed Cost Sharing:

  1. Mandatory Cost Sharing is required as a condition of the award.
  2. Voluntary Cost Sharing is offered by the recipient when not specifically required by the award.

Voluntary Uncommitted Cost Sharing is incidental support that is over and above what was proposed and agreed upon for the project. This is not included or quantified in either the proposal budget or the narrative. Generally, uncommitted cost sharing is not auditable or reported to the sponsor. Examples of language that can be used in proposals to indicate this type of cost sharing are provided at the end of this section.

CU Boulder PIs are advised to review and follow sponsor guidelines on cost sharing and to contact their Proposal Analyst with any questions about how to meet cost sharing requirements

Types of Cost Share

Third Party “In-Kind” Contributions:This is theestimated valueof any services and/or resources provided by a third-party in support of a sponsored project being administered by the University in lieu of cash. Third-party in-kind contributions may be in the form of real property, equipment, supplies and other expendable property, or goods and services directly benefiting and specifically designated for the University’s project or program.

University “Cash” Contributions: CU Boulder can make a cash contribution to a sponsored project for cost sharing purposes. This can be in the form of a University gift, endowment and/or other unrestricted fund to pay for any of the direct costs associated with a sponsored project (e.g., salaries, fringe benefits, travel, equipment etc.). In most cases, federal funds cannot be used to fulfill a cost share commitment.

In addition to a PI’s home department, the following entities may also be available to contribute cash cost share depending on the availability of funds: Research Innovation Office (RIO), College of Arts and Sciences, College of Engineering, and Graduate School.

Faculty Time/Effort:The value of faculty time/effort can be offered as a cash contribution if the cost sharing occurs during the project period and while the faculty member is under a continuing contract with CU Boulder. For example, if the project period is from January 1 to December 31 (a calendar year) the typical faculty member would be able to cost share his or her effort during the nine-month academic year (AY) but not during the summer months when he or she is not under contract with the University. AY cost share across all projects for an individual PI cannot exceed 40% of effort.

In addition to charging for time/effort, associated fringe benefit rates will apply and are included in the total cost share amount.

Note: OCG does not approve or document faculty time commitments; this is a PI and department responsibility.

Cost Sharing of Facilities and Administration (F&A) Costs:“F&A” refers to “facilities and administration” costs. F&A costs are considered “indirect” costs because, unlike direct costs, these costs cannot be allocated to only one particular project managed by the University. F&A costs canbe used as cost sharing in two ways:

  1. Contributed F&A: This refers to the F&A associated with any cash contributions being made to the project by the University. For example, if the PI plans to contribute time and effort to the project without compensation from the sponsor, the monetary value of this effort as well as the F&A associated with that effort may be offered as cost share. Contributed F&Ais always calculated using the F&A rate appropriate for the activity that the University has negotiated with the Department of Health and Human Services (DHHS) or according to the sponsor’s established indirect cost rate policy for non-profit, U.S. governmental agencies, and some federal sponsors. Contributed F&A may only be used as a part of the fulfillment of the University’s cost share obligation if the sponsor approves.
  2. Waived F&A: This situation occurs when the sponsor has a lower F&A rate, consistently applied to all awards, than CU Boulder’s negotiated rate. When F&A is “waived,” the University agrees not to charge its federally negotiated F&A rate to the sponsor. The portion waived is considered “unrecovered F&A” and can be used as cost share if allowed by the sponsor.

The Basics

The following guidelines are presented to help PIs determine when cost sharing should be offered in a proposal:

The cost sharing should be necessary.There is a notion that proposals can be more competitive if they include voluntary cost sharing, but this approach can backfire. For example, the National Science Foundation (NSF) will return any proposal that includes voluntary committed cost sharing without further review. PIs who feel it is important to show some sort of contribution to a proposed project should use the “good” examples provided at the end of this section to describe their commitment in qualitative rather than quantitative terms.Remember: Any voluntary cost share that is quantified in a proposal is auditable and highly discouraged by the University.

The cost sharing must occur during the period of performance. To be “counted” as cost sharing, contributed effort and resources must be expended, and not just obligated, within the approved project period. For example, if an airplane reservation is made before the end date of the project for travel that will occur after the project ends, the travel costs cannot be counted as cost share even though the reservation was made during the project period because the payment for the trip will occur after the approved project end date.

The type of costs contributed as cost share must be considered allowable by the sponsor. The rule of thumb is that if the sponsor will allow a particular cost to be charged to the sponsor, the same cost can be contributed as cost share. For example, federal sponsors do not consider entertainment costs charged to a federal project to be allowable costs. Therefore, CU Boulder or third party resources used for entertainment activities related to a federal project cannot be used to satisfy a cost sharing commitment. Federal sponsors rarely allow the funds supporting one federal project to be used as cost sharing for another project.

The costs must be allocable to the project.This means that any direct costs contributed as cost sharing must clearly benefit the sponsored project and not some other activity. For example, department administrator effort (e.g., secretaries, clerks) and office administrative expenses (e.g., telephone, supplies) are typically distributed across all the activities and objectives of a department and are not easily apportioned to any particular activity. Therefore, it would be difficult to document and use these costs for cost sharing purposes.

Additional Cost Share Sources

Non-CU Boulder Personnel Effort: Independent consultants and project volunteers can provide cost share under appropriate circumstances if the sponsor will accept the value of their time and effort as cost share. For example, if an independent consultant wishes to contribute his/her time to support a sponsored project being proposed by CU Boulder, at the proposal stage OCG will need a letter of commitment from the consultant, which should address the amount of time the consultant will devote to the project if funded, and include an estimate of the value of the consultant’s time (based on prevailing market values).

Equipment: The purchase of a piece of equipment that is directly allocable to the project can be considered as cost share. Equipment user fees/rates can also be contributed as cost share as long as the rates have already been established. Equipment that has already been purchased and does not have established user fees/rates cannot be used as cost share.

Third Party Cost Share

Subrecipients:When CU Boulder partners with another entity to carry out a sponsored project, the subrecipient may contribute cost sharing to the project. In such cases, OCG will require a letter of commitment, which should clearly state the total cost share amount and needs to be signed by the subrecipient’s authorized representative. Though cost sharing from a subrecipient will be provided by the subrecipient, as the lead institution, CU Boulder is ultimately responsible for the cost share should a subrecipient change and/or be unable to fulfill their cost share commitment.

Other Collaborating Entities:Cost sharing commitments can be made by entities other than subrecipients. If an organization that is “collaborating” on a CU Boulder project wishes to commit personnel time, space, equipment (purchase or user fees only), or other resources to a sponsored project being proposed by CU Boulder, OCG will require written commitment directly from the authorized representative of that organization prior to the submission of the proposal.As with cost share from a subrecipient, cost share from collaborating entities will be provided by the collaborator, but as the lead institution, CU Boulder is ultimately responsible for the cost share should a collaborator change and/or be unable to fulfill their cost share commitment.

PSR Form

  • If cost sharing is included in the proposal,the PI should answer “yes” to the following question in the PSR form: “Is cost share or matching included?”
  • The PI also needs to indicate the type of cost share: Mandatory or Voluntary.

PI Responsibilities

Committed cost sharing in a proposal to a federal agency represents a binding commitment by CU Boulder and, as such, is subject to audit under federal and other sponsor regulations at the award stage. Any quantifiable cost share offered in a proposal to a non-federal agency may also become a legally binding and an accountable commitment of the University upon award.

Legally binding cost share commitments must be documented in the same way as other charges. The PI is required to measure, document, record, and report the commitment in the CU finance system. Documentation of this commitment is also reported to the sponsor.

Unfulfilled cost sharing commitments or lack of documentation may result in a reduction of costs allowed against the sponsored project and a return of funds to the agency. Note: The cost sharing commitment made at the proposal stage is not automatically reduced if the anticipated award amount is reduced. Should the awarded amount be reduced from the proposed amount, the PI should work with OCG to adjust the committed cost sharing accordingly, particularly if the awarded budget requires a change in the scope of work.

To avoid financial liability as a result of audit disallowance, it is the responsibility of the PI to incur expenditures in accordance with applicable sponsor and University regulations and policies as well as applicable federal cost principles.

Chair/Director/Associate Dean of Research Responsibilities

While it is understoodthat some funding opportunities require (or reviews are favorably impacted by) institutional support, it is expected that the PI should first secure support from the units involved in the research, which is best achieved and/or coordinated by the College Associate Dean(s) of Research (ADR) and/or Institute Director. Thereafter, the ADR and/or Institute Director can coordinate with RIO to arrange any institutional commitment splits.

When a Chair/Director or ADR approves cost share by signing off on the Cost Share Addendum, the responsible administrator is indicating approval of the cost sharing commitments being made by the campus unit. The signature of the PI also indicates that the PI will be responsible for documenting and reporting the cost share in the CU finance system and to the agency. However, this is more than a PI responsibility.Failure to meet the pledged cost share can result in a reduction of agency funding, and this can impact department/unit/college resources. Therefore, it is imperative that Chairs, Directors, and ADRs only approve cost sharing commitments that are necessary, allowable, and allocable (related/integral to the specific project in question).

Cost Sharing Checklist

The following checklist is provided to help both PIs and administrators make decisions about cost sharing.If the answer to any of these questions is, “No,” cost sharing should not be included in the proposal.

  1. Is the cost sharing either mandatory or is there persuasive evidence that cost sharing is necessary?
  2. Is the cost sharing being proposed directly related and integral to this project?
  3. Will it be possible to document the cost sharing for reporting purposes?
  4. Is the type and source of cost share being proposed allowed by the sponsor?
  5. Will the cost sharing take place within the project period?
  6. Has the contributed effort of CU Boulder project personnel been approved by each individual’s Chair/Director or ADR?
  7. Have all University cash contributions been documented/approved by someone authorized to do so?
  8. Have all third party contributions been documented/approved by each organization’s authorized representative?

Cautionary Guidance

Cost sharing is normally stated in the budget. However, cost sharing commitments can be stated in the budget explanation or justification or in the text of the narrative. No matter where cost sharing commitments are found within the proposal, statements of cost sharing commitment can be legally binding by the institution and the sponsor should the proposal be funded, even when not required by the sponsor. By using language in proposals that cites percentage of time, salaries, or specific levels of support, PIs can commit to cost sharing, often unintentionally. In all instances where cost sharing is specified and quantified in a federal proposal, the PI and CU Boulder will be obligated to account for and document these commitments along with funds awarded by the federal sponsor.

Examples of Suggested Language

The examples below may be used in proposals to address the provision of academic or programmatic contributions or support when cost sharing is not required or intended. Also below are examples of language to avoid when cost sharing is not required by the sponsor.

Cost Sharing Not Required - Examples:

Note: use when there is no cost sharing commitment required by the sponsor.

  • Professor X will be providing expert advice and consultation to the project, as needed.
  • The University demonstrates support to the project through the availability and expertise of the Project Director (or PI).
  • Professor X is PI and requests x% salary support for this project. She will provide additional support to the project, as needed.
  • Professor X will direct all research activities associated with the project [specify...]
  • Professor X will oversee [all aspects of] the project.
  • Dr. Y will participate in the project at every stage [specify...]
  • Professor X will provide scientific direction and supervision for the project [including...]
  • Professor X will have significant involvement through the project. She will be providing expert advice and consultation on all aspects of the research.
  • Dr. Y is PI and requests x% salary support to the project. He will provide additional support as needed.
  • Professor X’s laboratory is x square feet. She also has access to the departmental [equipment name] that is beneficial to the research.
  • The University demonstrates support to the multistage project through the availability and expertise of the project director.
  • Dr. Y will be integrally involved in the project. He will have access to equipment that will ensure the successful execution of the proposed research and he will see the data analysis and report writing through to completion.
  • The PI will have access to additional resources, such as [equipment name], to ensure the successful execution of this scope of work
  • No salary support is being requested for Professor X; however she will provide intellectual direction for the project, will have direct and significant involvement throughout the project, and will co-author publications.
  • The fully supports the academic year salaries of Professors, Associate Professors, and Assistant Professors, but makes no specific commitment of time or salary to this particular project.

Terms to Avoid:

The following are “Red Flag” Termsthat suggest cost sharing is present. Do not use these termsunless cost sharing is required by the sponsor.

  • Cost sharing
  • Sharing
  • Matching
  • In-kind
  • Donate
  • Commit % or $
  • Allocate % or $
  • Exclusive Use
  • Volunteer
  • Support at no cost
  • Contribute

Cost Sharing Required - Examples:

Note: only use when a cost sharing commitment is required.

  • The is highly supportive of this project and agrees to be responsible for the salary of the PI for its duration.
  • Effort equivalent to $xx,xxx in salary and benefits will be provided by Professor X.
  • An annual stipend of $xx,xxx is requested for one full-time Graduate Student Researcher. In addition, the will cost share the graduate student’s out-of-state tuition at an amount approximately totaling $xx,xxx per year.
  • Professor X will devote 20% of her time to the project at no cost to the sponsor.
  • Dr. Y is PI and will devote 40% effort (30% salary support requested) to the project.
  • The department will purchase a [equipment name] (cost $xx,xxx) for exclusive use in support of Professor X’s project.
  • The University demonstrates support and will contribute to the multistage project through partial salary for the project director.
  • Dr. Y will contribute a week of field work and the time required for data analysis and report writing, and he will supply all equipment.
  • The PI will be contributing funds from other sources for use of [equipment name] to ensure that this scope of work can be performed on the proposed budget.
  • Professor X will provide intellectual direction of the project and co-author publications. Her time (5% effort) will be contributed by the College.

Forms, Policies and Additional Information