Cost Sharing and Effort
Cost sharing is the portion of the budgeted costs of a sponsored project that is not borne by its sponsor. Most often these costs are supported by the university itself in the form of in-kind contributions of personnel time, space, equipment use, and services. Sometimes the university's accounting of cost sharing is used to satisfy a mandatory matching requirement. But whether the cost sharing is mandatory or voluntary, if it is committed in advance, its source, quantity, and nature must be reported and accounted for to the federal government.
Whenever effort is proposed on an application without a request for salary support, this constitutes committed cost sharing. Given that this cost sharing must be accounted for, such proposed effort requires more than just the consent of the person whose effort is being committed. If the effort is not to be supported by the grant, it will need to be supported by another source and the person or persons who are responsible for that source need to approve the proposed use of their resources. This approval needs to be obtained whether the employee committing unsupported effort is in the department of the principal investigator or is a member of another department. At the time of proposal development to Research Grants & Contracts (RGC), the OHSU Committed Cost Sharing Agreement must be completed.
At the time the grant is funded, RGC will contact the relevant department administrators to obtain the account numbers to which cost-shared effort will be charged. This information is provided to Sponsored Projects Administration (SPA) when the grant award material is forwarded for account set up. SPA then handles the charges for this time, the post-award tracking of the investigator's effort, and accounts for the cost sharing information that is reported to the federal government.
The cost sharing agreement may also include effort commitment. When an OHSU investigator proposes to collaborate with an OHSU colleague in a grant application, the advance consent of the colleague is required both for the collaboration and for the level of effort that he or she is expected to contribute to the project. This effort, stated as a percentage of the investigator's time, is a real commitment. At the time of proposal development to RGC, the OHSU Committed Cost Sharing Agreement must be completed.
When the application is awarded, this committed effort must be tracked by the investigator as a part of his or her active support and by the university, which has a responsibility to ensure that the effort and the salary charged to support it are in agreement. At OHSU, effort is tracked by SPA. As long as the application is still active, the collaborating investigator must keep track of the commitment and is required to account for it, with full grant details, whenever asked by a sponsor to report on his or her pending research support.
The federal government holds the university responsible for complete and accurate effort reporting and for seeing to it that each investigator's complement of support accurately reflects their actual programmatic activities. Organizations that fail to do so are subject to heavy fines and sanctions that inhibit their ability to receive federal funds for research.
If the application commits the effort of an outside investigator and that effort is not to be funded by the grant, these details must be acknowledged in the collaborator's letter of support. For the strength of the application, it is advised, but not required, that this letter be co-signed by the collaborator's institutional official.
Effects of Cost Sharing
It is worth noting that, in the accounting process, committed cost sharing reduces the university's ability to recover its full indirect costs. So unless the cost sharing is mandatory, these are costs that have a negative fiscal impact twice, once when the university uses internal resources for purposes that could be supported externally and again when we experience a shortfall in the recovery of facilities and administration expenses.