Topics Covered


Cost Share 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.

The cost share obligation must be met using non-federal, non-sponsored funds unless explicitely denoted by both sponsoring agencies. 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, 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. There are two types of cost sharing: mandatory and committed.

Review a 7 minute “What is Cost Share?” tutorial video

Types UW of Cost Share 

• Mandatory (M): 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 (R): Cost sharing that the PI commits in the project proposal budget or the budget justification that is not required by the sponsor as a condition of the award.  However, once committed the pledge is required to be met.

  • The University discourages cost sharing commitments when not required by the sponsor.
  • The commitment is expressed as a dollar amount or a percent of effort.

• Shift (S= Long Term shift) or (SS=Short Term Shift): Cost share that is created when a faculty member moves their committed effort from being paid by the award to being paid from non-grant sources without reducing their effort on the award.

  • A short term shift is for a period less than 6 months in duration and does not require a cost share addendum (GC1 addendum) but is noted on the FEC.
  • For a long term shift of 6 months or more, the department should submit to GCA a cost share addendum and calculator spreadsheet. GCA enters the commitment into the cost share summary so that it will be displayed the FEC.

• Salary Cap (C): Cost sharing required of faculty whose Institutional Base Salary (IBS) exceed the sponsor mandated salary (cap) that can be paid with the award funds.

  • Salary Cap cost sharing is required by (applies to flow through awards as well):
    • National Institute of Health (NIH)
    • Substance Abuse and Mental Health Services Administration (SAMHSA)
    • Agency for Healthcare Research and Quality (AHRQ)
    • Center for Disease Control (CDC) (after December 23, 2011)
    • As well as some non-federal sponsors
    • Health Resources and Services Administration (HRSA) (after December 23, 2011)
    • Additional information for Salary Cap Cost Share is available via  Salary Cap Limitations information published by Management Accounting and Analysis.

• “K” Award Cost Share (K): Cost share that occurs when the combination of the required level of effort and salary limitation on the award does not allow for the corresponding level of the faculty member’s salary to be paid from the “K” award.

  • For Example; A “K” award often requires a minimum 75% effort and limits the salary amount to be funded at $95k per year. If the faculty member’s Institutional base salary is $150k, 75% is $112.5k. The difference between $112.5k and $95k ($17.5k) is often cost shared.

NOTE: Salary Cap (C) and K Award (K) Cost Share are not included in a proposal as cost share and no cost share commitment is entered into the eFECS Cost Share Summary application. However, both Salary Cap and K award cost share will be noted on the FEC.

Cost Share F&A Rates

There are three different F&A rates used for Cost Share expenses.  Users need to understand these rates and which is applicable to the items included as Cost Share on the specific Award:

Standard F&A Rate:  The negotiated percentage rate of recovery for calculating indirect costs at the time the Award was issued.  This is the rate negotiated between the UW and the federal government for actual cost recovery on a sponsored Award.    Information on the Standard Rate can be found here.

Actual F&A Rate:  The actual percentage rate of recovery applied by the sponsor on the Award.  This rate can be the same or different from the Standard Rate.  For example, if the Sponsor accepts the Standard Rate then both the Standard and Actual rates would both be 55%.  If the Standard Rate is 55% but the Sponsor limits F&A to 25%, then the Standard Rate is 55% and the Actual Rate is 25%. 

Cost Share F&A Rate (also referred to as “Cost Share I/C Rate”):  This is the F&A rate applied to the applicable Cost Share expenses.  If the Sponsor:

  • explicitly disallows F&A to be incurred on Cost Share expenses then the F&A Rate is 0%. 
  • specifies the F&A Rate to be on Cost Share expenses then that is the F&A Rate. 
  • is silent on the applicable F&A Rate for Cost Share expenses, then F&A Rate is the Standard F&A Rate.   


Contribution Sources

Process Overview

The following outlines the different stages of an award and the special steps taken when an award includes cost sharing.

  • PI – refers to the principal investigator and/or a staff member with delegated authority
  • Sponsor – the organization or person providing the grant/contract
  • OSP – Office of Sponsored Programs
  • GCA – Grant and Contract Accounting
  • MAA – Management Accounting and Analysis
  • eFA – electronic Funding Action

 When?  Who?  What?





 Prepare the cost share pledge by:

  1. Read Grants Information Memorandum (GIM) 21
  2. Contact OSP
  3. Formula for Determining the Amount of Cost Share Committed
  4. Clearly documenting cost sharing on the proposal budget page or in the proposal budget justification.
  5. Leave any discussion of cost sharing out of any other proposal text.
  6. Complete the Cost Share Addendum and cost share calculator spreadsheets if applicable.
  7. Attach signed documentation from each source promising to contribute.
  8. If the contribution is from:
  • a separate UW department/division, a signed letter from a provost, dean or chair is acceptable.
  • third party (not the University or the sponsor), the letter must be on the contributor's letterhead, signed by an organizational representative authorized to obligate funds
  • NOTE:  inform third party contributors of their responsibility to document and report on their contribution.

 9. Submit the support letters with the rest of the proposal package to OSP.

Contact OSP with any questions regarding the pledge

  • Reviews cost share contributions for allowability and (when everything else is ready) submits the proposal package to the sponsor.
  • Negotiates with the sponsor.
 Approval Sponsor
  • Approves the proposal, including cost share commitment and notifies OSP.
  • Prepares the eFA, which lists the cost share commitment and amount
  • Attaches the Cost Share Addendum, etc., and sends it to GCA
  • Sets up the budget in the Financial Accounting System (FAS).
  • Notifies Department budget has been set up.
  • Cost share commitments are recorded in the eFECS Cost Share Summary application.
  • Review the cost share pledge in the Cost Share Summary application.
  • Notify GCA via GrantTracker if there are questions about how the cost share was set up.
    • It is the Principal Investigator's responsibility to ensure that the cost sharing pledge on the grant or contract is correct and that it is met on schedule.
Throughout Life of Grant PI
  • At least quarterly, review the cost share activity via the Unmet Cost Share report and/or the Cost Share Summary Application.
  • Document and report Non-FEC cost share contributions to GCA at least quarterly.
  • Follow the Faculty Effort Certification (FEC)procedures to document faculty cost share.  
    • Interim Cost Share Reports (Used when sponsors require invoices or financial reports that include cost share contributions and FECs are not yet available for an FEC cycle that has passed.)
  • Posts actual FEC cost share automatically when the FEC is certified online by the faculty.
  • Works with PI and/or faculty member to ensure the FEC cost share pledge is met.
Closing PI
  • Ensures cost share is met before closing.
  • Notifies GCA of pending cost share reports.
  • Submits interim FEC cost share reports to MAA as necessary for reporting or invoicing the sponsor.
  • Closes budget once all expenditures have posted and the cost share is met.
  • Reports to the sponsor as required.

Additional Procedures

Most changes to mandatory cost sharing commitments must be reviewed and approved by OSP and often by the sponsor. After OSP reviews and approves a change to a cost sharing pledge, an ePAC is issued with the revised cost sharing addendum and sent to GCA. GCA will update information in the eFECS Cost Share Module based on the addendum included on the ePAC.

  • GCA can ONLY change cost sharing information without an electronic Post Award Change (ePAC) in the following situations:
    • when the effort of a faculty member who is not the PI or other “key personnel” identified in the award is substituted for that of another faculty member and the overall dollar amount of the cost share is not reduced,
    • when a cost sharing pledge must be moved to a continuation budget,
    • at expiration, if total amount of cost sharing pledged is based on a percentage of total expenditures and actual cost sharing funds equal that calculated amount,
    • when a faculty member wants to perform cost sharing in a different cycle than that listed in the eFECS Cost Share Module, if that cycle is within the grant period, or
    • when changes (not reductions) to a committed cost share pledge are requested. (Reductions in overall mandatory or committed cost share must be approved by Office of Sponsored Programs and sponsors.)