Cost Share Policy

Cost Share (sometimes also referred to as Matching Funds) is the portion of a project or program cost not borne by the sponsor. It is the University's share in the cost of conducting the project/program. Cost sharing occurs either when a sponsor requires, or the University commits in a proposal, funds beyond those awarded by the sponsoring agency to support a particular grant or contract.

Under Federal research proposals, voluntary committed cost sharing is not expected. It cannot be used as a factor during the merit review of applications or proposals, but may be considered if it is both in accordance with Federal awarding agency regulations and specified in a notice of funding opportunity. Criteria for considering 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 the notice of funding opportunity.

Cost sharing may be required by federal sponsors, and the obligation must be met using non-federal funds. Only charges that would be allowable as direct costs to the award are allowable as cost sharing. Federal flow through funds may not be used as a cost sharing source unless prior written approval has been received from both the federal sponsor and the flow through sponsor.

The "cost share" pledge may be either a fixed amount of money, or a percentage of the project costs, or the commitment of a specified level of effort. The term "cost matching" often refers to cost sharing where the amount required as cost share is equal to the amount received from the sponsor. This is also known as dollar-for-dollar cost sharing or matching.

  • Mandatory: Cost sharing that the sponsor requires as a condition of the award.
    • For example, if the total cost of a project is $150,000, the sponsor might award $100,000 and require that the University provide (or find an outside source to provide) the additional $50,000 from non-federal funding sources.
    • The sponsor may require the University to provide either a fixed amount of money or a percentage of the total project costs as cost sharing.
  • Voluntary Committed: Cost sharing that the PI commits in the project proposal budget or the budget justification that is not required by the sponsor. However, if Voluntary Cost Share is committed in a proposal, the Cost Share becomes mandatory if the proposal is awarded.
    • The University discourages cost sharing commitments when not required by the sponsor.
    • The commitment is quantified as a dollar amount.

Please use the UCSC Cost Share (CS) Preliminary Commitments form to start documenting cost share. Contact your OSP proposal analyst if you need assistance.

Central Funds as Cost Share

In a letter dated April 17, 2015 from Vice Chancellor for Research Scott Brandt, policy for central funds as cost share was formalized. The policy is as follows:

The Office of Research wants to support as many projects and proposals as possible, but our resources are not unlimited. For this reason, we can generally consider providing central campus matching funds for cost sharing only for proposals with mandatory cost sharing requirements.

While we cannot provide central funding for voluntary, unsolicited cost sharing, there are many other opportunities to demonstrate cost sharing in addition to cash contributions, including:

  • Contributed effort and the fringe benefits associated with that effort (e.g., faculty time supervising a project);
  • Services provided by university shops and cost centers at less than actual cost (e.g., departmental machine shops, animal care, etc.);
  • Third party contributions, such as equipment or effort donated by the third party (other than federal), including non-federal or non-state grants or gifts raised for the purpose of cost sharing projects;
  • Any unrestricted gift funds applied to the project;
  • University general funds used to pay for any part of the project, such as travel specifically for project needs;
  • Indirect costs not recovered for cost shared contributions; and
  • Waived indirect costs.

These forms of cost sharing should be utilized to contribute to required/mandatory cost sharing along with cash contributions, and may also be used for voluntary contributions.

The Vice Chancellor for Research and the Executive Vice Chancellor will consider providing a cash commitment toward a project or proposal if the Principal Investigator's Department Chair or ORU Director and cognizant Dean have a) guaranteed that adequate space and infrastructure are available to conduct the project, and b) pledged a significant portion—typically no less than half—of the required total. The competitiveness of the request will depend on how well the application meets at least some of the following criteria:

  • The proposed project is significant in scope and vital to the campus mission;
  • The proposed project is pioneering in nature and is expected to lead the campus into desired new fields of research endeavor;
  • The proposed project includes principal investigators from more than one department or ORU;
  • The proposed project is from a department or unit on campus that has limited access to extramural funding by nature of the research discipline;
  • The proposed project has been selected to represent the campus in a limited submission competition;
  • The request is for seed money and has the potential of fostering new research initiatives on campus and/or opening up new avenues of enhanced future funding; and/or
  • The PI has not previously received seed/cost sharing funds or has performed well relative to these criteria with previous funding.

Cost Sharing Guidelines

This Cost Sharing overview overview includes: Role and Responsibilities, Federal Requirements, Definitions, and Expenditures Not Allowed as Cost Sharing.