Written by Justo Torres, Director, Contracts and Grants.
“Cost sharing” refers to the portion of the total sponsored project costs that are not paid by the sponsoring agency. “Matching” is another commonly used term. There are primarily three types of cost sharing that may occur on sponsored projects: mandatory cost sharing, voluntary committed cost sharing and voluntary uncommitted cost sharing. Let’s look into each of these.
Mandatory Cost Sharing
Mandatory cost sharing is required by the terms of the sponsored program and must be included and budgeted for as part of the sponsored award. It is explicitly required by the notice of funding opportunity and must be included in the proposal for consideration by the sponsor. Mandatory cost sharing must be spent on allowable items that support the program and must be reported to the sponsor.
Voluntary Committed Cost Sharing
Voluntary committed cost sharing is not required by the terms of the sponsored program but is included and budgeted for as part of the sponsored award. It is not expected by the sponsor in the proposal and cannot be considered as a factor of merit review by the sponsor unless criteria for consideration are explicitly described in the notice of funding opportunity. Voluntary committed cost sharing must be spent on allowable items that support the program and must be reported to the sponsor.
Voluntary Uncommitted Cost Sharing
Voluntary uncommitted cost sharing is not required by the terms of the sponsored program and is not included or budgeted for as part of the sponsored program. It is neither proposed nor expected but may occur during program administration. This type of cost sharing is not reported to the sponsor.
Common Sources
Common sources of cost sharing include salaries and wages, other direct costs, unrecovered indirect costs, other sponsored programs (note: federal funding cannot be used to cost share federal awards) and external partners (in-kind).
Want to learn more?
For a deeper dive into the topic of cost sharing, please visit the Cost Sharing page in the Research Administration and Compliance website.