Handbook of Operating Procedures

I. POLICY AND GENERAL STATEMENT

The University of Texas Health Science Center at Houston ("University") seeks to support its faculty in the pursuit of their research interests while, at the same time, allocating all available resources to comprehensive support of the whole University enterprise. In doing so, the University intends to allocate University resources to their highest and best use. Upon occasion, a University principal investigator may desire to respond to a grant announcement where the grantor requires that the University share the costs of conducting the research. Cost sharing, as defined below, may be requested by the grantor in the form of funds or other University resources that would be contributed or allocated to a sponsored project over and above the support provided by the grantor. This commitment made by the University creates the requirement to track cost sharing in accordance with this policy. The purpose of this policy is to describe the methods utilized when cost sharing is contemplated and/or approved.

The most common form of cost sharing is contributed effort. Faculty and other employees' salaries and benefits costs and their related indirect costs may be deemed the most suitable expenses to be contributed as cost sharing. Typically a grantor will require that cost-shared effort be directly related to the project's objectives and not include time spent on administrative or instructional activities (unless directly related to the project's objectives).

The decision as to whether to commit to cost sharing with a grantor resides with the University and its fiduciary agents (e.g., department head, dean, vice presidents). Only when an individual in the line of authority of the principal investigator's department or school approves the commitment of funds or resources to cost sharing will the University permit a response to such a grant announcement. Once an award is made, mandatory cost sharing and voluntary committed cost sharing, as defined below, are binding obligations of the University.

The University and its fiduciary agents will generally approve cost sharing only when it is required by the grantor and, more importantly, when the research in question is deemed to be of sufficient potential and/or quality to warrant the commitment of University resources.

II. DEFINITIONS

Cost Sharing: The funds or resources under University control that are contributed or allocated to a sponsored project over and above the support provided by the external sponsor of that project. It is that portion of a project cost that is not borne or reimbursed by the sponsoring agency. Below are the various types of cost sharing.

Mandatory Cost Sharing: Cost sharing required by the sponsoring agency as a condition of its support of a particular project. Mandatory cost sharing is usually specified in a program announcement or application package. Mandatory cost sharing is a binding obligation of the University.

Voluntary Cost Sharing: Cost sharing the University contributes to a project at its own initiative without any requirement for cost sharing imposed by the sponsoring agency. There are two types of voluntary cost sharing:

• Voluntary Committed Cost Sharing: Voluntary cost sharing offered by the University at the time of proposal submission. The proposed cost sharing amount is included in the budget. Once an award is made, voluntary committed cost sharing is a binding obligation of the University. The University actively discourages voluntary committed cost sharing.
• Voluntary Uncommitted Cost Sharing: Voluntary cost sharing not offered by the University at the time of proposal submission. Voluntary uncommitted cost sharing is not included in the budget but is contributed after the award has been granted and more resources than awarded are needed to complete the project. Voluntary uncommitted cost sharing is not a binding obligation of the University. The University actively discourages voluntary uncommitted cost sharing.  

III. PROCEDURE

A. Responsibility

It is the responsibility of the principal investigator and his or her department/school to identify and document the source of funds proposed to be used for cost sharing and to comply with OMB Circular A-110 Subpart C Section 23, as applicable.

This commitment must be documented on the University's Review and Approval Form, which is submitted to the Sponsored Project Administration (SPA).

If departmental or school funds are to be committed to cost sharing, the principal investigator’s direct supervisor, chair equivalent (or designee) and dean must approve the commitment. If institutional funds are requested to be committed as cost sharing, the Senior Vice President, Finance and Business Services must approve the commitment.  All cost sharing commitment requests of $100,000 or more require the approval of the Senior Executive Vice President, Chief Operating and Financial Officer and the Executive Vice President & Chief Academic Officer. 

When all relevant approvals for cost sharing have been obtained and documented on the Review and Approval Form, SPA will process the proposal.

B. Tracking

To identify, monitor and track all mandatory and voluntary committed cost sharing, SPA will notify Post Award Finance (PAF) of any awarded projects that have mandatory or voluntary committed cost sharing. At the time of account set-up, PAF will flag the project as having cost sharing within the Financial Management System (FMS).

It is the responsibility of the administrative supervisor to verify that cost sharing amounts remain available and are appropriate, especially when an awarded budget is less than the proposed budget.

It is the responsibility of the administrative supervisor to ensure funds used to meet the matching requirements of a contract or grant are only used once and may not be used against multiple sponsored projects.

Particular care must be taken to ensure costs normally included in the indirect cost rate computation are not included as cost sharing. Cost items such as equipment depreciation, University-furnished space, and department administration expenses are included in the indirect cost computation and must not be considered for cost sharing. In addition, adherence must be made to salary caps established by sponsors. For instance, if a faculty salary exceeds the NIH salary cap and is not reimbursable by NIH, the salary in excess of the cap may not be used as cost sharing for NIH awards.

IV. CONTACTS

• • Sponsored Projects Administration
  • 713-500-3999
  • https://www.uth.edu/sponsored-projects-administration/index.htm

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