Cost Sharing

Cost sharing is the portion of a project or program cost that is not reimbursed by the sponsor. In a proposal or an award, cost sharing represents a commitment by the Institute.

Types of Cost Sharing

• Mandatory – The sponsor requires cost sharing as a condition of the award.
• Voluntary – The sponsor does not require cost sharing as a condition of the award, but MIT offers cost sharing in the proposed budget to be more competitive.

Read MIT’s Cost Sharing Policy (PDF)

• What Is Allowable/Eligible Cost Sharing?
• MIT’s Preferred Cost Sharing Funds
• Third-Party Cost Sharing
• Showing Cost Sharing in a Proposal Budget
• Funding F&A Costs as Cost Sharing
• Using Faculty Effort for Cost Sharing
• Setting Up Cost Sharing on a New Award
• Tracking/Reporting Cost Sharing
• NSF Cost Sharing Policy – MIT Recommendations
• Special Cost Sharing Topics
• Cost Sharing: A Primer for DLC Administrators
• Cost Sharing Template [PDF]

Key References

• Cost Sharing Primer for DLC Administrators
• Sponsored Programs Reference Manual, Section 4, Cost Sharing (PDF)
• Cost Sharing Template: Recording Post-Award Cost Sharing Obligations
• Data Warehouse Reports for Cost Sharing

FAQ’s

How do I know that my cost sharing costs are allowable?

As with costs directly charged to the sponsor, allowable cost sharing must be necessary and reasonable for the performance of the project objectives. As with direct charged expenses, cost shared expenses must be reasonable, allocable (i.e., directly benefit the specific project), and consistent with the terms of the award. Allowable cost sharing expenses must be expended (i.e., incurred) during the effective date of the award project. For details on eligibility criteria, see What Is Allowable/Eligible Cost Sharing.

Does MIT have preferred costs for cost sharing?

Yes, use:

• Up to 66 percent of the MIT-provided tuition subsidy for Graduate Research Assistants
• Equipment
• Other expense categories
• Faculty academic year (AY) effort greater than 10 percent, Employee Benefits, F&A

How can I show voluntary cost sharing for Principal Investigators and other Key Personnel that is less than 10 percent?

If cost sharing is neither required as a condition of the award nor mandated by the Institute—and less than 10 percent of an individual’s total effort is expected to be contributed to the project—the following statement should be included in the text of the proposal or on the budget justification: “MIT 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 research project.” This statement assures not only that the faculty member will make a contribution to the project, but also that the expected level of AY effort will not be a significant portion of the individual’s overall effort.

How do I determine the value of contributed items from third parties?

In general, values for contributions of services and property are established in accordance with A-21 Cost Principles for allowability and the terms of the federal award. All documentation should include a brief statement describing the basis for determining the valuation of services, material, or equipment. Detailed Valuation and Documentation Guidelines are described in the reference document: Cost Sharing Primer for DLC Administrators.

How do I treat F&A in mandatory and voluntary cost sharing?

• Mandatory committed (required by the sponsor in the proposal solicitation or in the award negotiation):
  The DLC pays direct costs; MIT pays F&A costs.
• Voluntary committed (committed in the proposal but not required in the proposal solicitation):
  The DLC pays both direct and F&A costs.

How do I show cost sharing from a subrecipient?

Request that the subrecipient provide a budget that separately details, year by year, the proposed project; funds that are requested from the prime sponsor; and the direct and indirect costs that are offered as cost sharing by the subrecipient. The subrecipient’s budget should provide the same level of detail that the DLC provides for an MIT budget request. Please follow the instructions for entering cost sharing in the Coeus User Guide.