§ 200.306 - Cost sharing.

§ 200.306 Cost sharing or matching.

(a) Under Federal research proposals, voluntary Voluntary committed cost sharing is not expected . It cannot be used under Federal research grants. The Federal agency may not use voluntary committed cost sharing as a factor during the merit review of applications or proposals , but may be considered if it is both in accordance with Federal awarding for Federal research grants unless authorized by Federal statutes or agency regulations and specified in a the notice of funding opportunity. Criteria for considering Federal agencies are also discouraged from using voluntary committed cost sharing as a factor during the merit review of applications for other Federal financial assistance programs. If voluntary committed cost sharing and any other program policy factors that may be used to determine who may receive a Federal award must be explicitly described in is used for this purpose for other programs, the notice of funding opportunity must specify how an applicant's proposed cost sharing will be considered. See also §§ 200.414 and , 200.204, and appendix Appendix I to this part.

(b) For all Federal awards, any shared costs or matching funds and all contributions, the Federal agency or pass-through entity must accept any cost sharing funds (including cash and third-party in-kind contributions, must be accepted and also including funds committed by the recipient, subrecipient, or third parties) as part of the non-Federal entityrecipient's cost sharing or matching when such contributions meet all of the following criteriaor subrecipient's contributions to a program when the funds:

(1) Are verifiable from the non-Federal entityin the recipient's or subrecipient's records;

(2) Are not included as contributions for any other Federal award;

(3) Are necessary and reasonable for accomplishment of project or program objectivesachieving the objectives of the Federal award;

(4) Are allowable under subpart E of this part;

(5) Are not paid by the Federal Government under another Federal award, except where the program's Federal authorizing statute authorizing a program specifically provides that Federal funds made available for such the program can be applied to matching or cost sharing requirements of other Federal programs;

(6) Are provided for in the approved budget when required by the Federal awarding agency; and

(7) Conform to other applicable provisions of this part, as applicable.

(c) Unrecovered indirect costs, including indirect costs on cost sharing or matching , may be included as part of cost sharing or matching only with the prior approval of the Federal awarding agency or pass-through entity. Unrecovered indirect cost means the difference between the amount charged to the Federal award and the amount which could have been charged to the Federal award under the non-Federal entityrecipient's or subrecipient's approved negotiated indirect cost rate.

(d) Values for non-Federal entity recipient or subrecipient contributions of services and property must be established in accordance with the cost principles in subpart E of this part. If When a Federal awarding agency or pass-through entity authorizes the non-Federal entity recipient or subrecipient to donate buildings or land for construction/facilities acquisition projects or long-term use, the value of the donated property for cost sharing or matching must be the lesser of paragraph (d)(1) or (2) of this sectionbelow.

(1) The value of the remaining life of the property recorded in the non-Federal entityrecipient's or subrecipient's accounting records at the time of donation.

(2) The current fair market value. However, when there is sufficient justification, the Federal awarding agency or pass-through may approve using the use of the current fair market value of the donated property, even if it exceeds the value described in paragraph (d)(1) of this section at the time of donation.

(e) Volunteer services furnished by third-party professional and technical personnel, consultants, and other skilled and unskilled labor may be counted as cost sharing or matching if the service is an integral and necessary part of an approved project or necessary for the program. Rates for third-party volunteer services must be consistent with those paid for similar work by the non-Federal entity. In those instances in which recipient or subrecipient. When the required skills are not found in the non-Federal entityrecipient's or subrecipient's workforce, rates must be consistent with those paid for similar work in the labor market in which the non-Federal entity where the recipient or subrecipient competes for the kind of services involved. In either case, paid fringe benefits that are reasonableallowable, necessary, allocable, and otherwise allowable reasonable may be included in the valuation.

(f) When a third-party organization furnishes the services of an employee, these services must be valued at the employee's regular rate of pay plus an amount of fringe benefits that is reasonable, necessary, allocable, and otherwise allowable, and indirect costs at either the third-party organization's approved federally-negotiated indirect cost rate or, a rate in accordance with § 200.414(d) provided these services employ the same skill(s) for which the employee is normally paid. Where donated services are treated as indirect costs, indirect cost rates will separate the value of the donated services so that reimbursement for the donated services will not be made.

(g) Donated property from third parties may include items such items as equipment, office supplies, laboratory supplies, or workshop and classroom supplies. Value The assessed to value of donated property included in the as cost sharing or matching share must not exceed the property's fair market value of the property at the time of the donation.

(h) The method used for determining cost sharing or matching for third-party-the value of donated equipment, buildings, and land for which title passes to the non-Federal entity recipient or subrecipient may differ according to the purpose of the Federal award, if paragraph (h)(1) or (2) of this section applies.

(1)

following:

(1) If the purpose of the Federal award is to assist the non-Federal entity in the acquisition of recipient or subrecipient in acquiring equipment, buildings, or land, the aggregate value of the donated property may be claimed as cost sharing or matching.

(2) If the purpose of the Federal award is to support activities that require the use of equipment, buildings, or land, normally only depreciation charges for equipment and buildings may be made. However, the fair market value of equipment or other capital assets and fair rental charges for land may be allowed , if provided that in the Federal awarding agency has approved the chargesterms and conditions of the Federal award. See also § 200.420.

(i) The value of donated property must be determined in accordance with the usual accounting policies of the non-Federal entity, recipient or subrecipient with the following qualifications:

(1) The value of donated land and buildings must not exceed its fair market value at the time of donation to the non-Federal entity recipient or subrecipient as established by an independent appraiser (e.g.for example, certified real property appraiser or General Services Administration representative) and certified by a responsible official of the non-Federal entity recipient or subrecipient as required by the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended, (42 U.S.C. 4601-4655) (Uniform Act) except as provided in the implementing regulations at 49 CFR part 24, “Uniform Relocation Assistance And Real Property Acquisition For Federal And Federally-Assisted Programs”Programs.”

(2) The value of donated equipment must not exceed the fair market value of equipment of the same age and condition at the time of donation.

(3) The value of donated space must not exceed the fair rental value of comparable space as established by an independent appraisal of comparable space and facilities in a privately-owned building in the same locality.

(4) The value of loaned equipment must not exceed its fair rental value.

(j) For The fair market value of third-party in-kind contributions , the fair market value of goods and services must be documented and, to the extent feasible, supported by the same methods used internally by the non-Federal entityrecipient or subrecipient.

(k) For IHEs, see also institutions of higher education (IHE), voluntary uncommitted cost sharing should be treated differently from mandatory or voluntary committed cost sharing. Voluntary uncommitted cost sharing should not be included in the organized research base for computing the indirect cost rate or reflected in any allocation of indirect costs. Voluntary uncommitted cost sharing includes faculty-donated additional time above that agreed to as part of the award. See OMB memorandum M-01-06, dated January 5, 2001, Clarification of OMB A-21 Treatment of Voluntary Uncommitted Cost Sharing and Tuition Remission Costs.