Cost Sharing Policy for Sponsored Programs
Purpose
This policy outlines the requirements for the approval, administration, and accounting of cost sharing on sponsored programs awarded to the University of Dayton. This policy is intended to both encourage the thoughtful allocation of University resources in support of research and scholarly activity as well as to ensure compliance with Federal regulations and cost accounting standards. This policy applies to cost sharing of both direct and indirect costs. The transparent and equitable return of indirect cost recovery is critical in supporting and promoting research and scholarly activity. Therefore, this policy also addresses how cost sharing of indirect costs impacts departmental, unit and University resources.
Scope
This policy applies to University of Dayton faculty and staff who participate in or support sponsored programs.
Policy History
Effective Date: May 24, 2016
Approval: December 2, 2025
Policy History:
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Approved in original form: May 24, 2016
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Approved as amended: December 2, 2025
Maintenance of Policy: Vice President of UDRI, University of Dayton Research Institute; and Vice President for Academic Research, Office for Academic Research
Policy
The University of Dayton’s commitment to research and scholarly activity may include an agreement to provide cost sharing for a particular sponsored program. The decision to provide cost sharing is normally made to enable eligibility for a particular award that requires cost sharing. 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 both in accordance with Federal awarding agency regulations and specified in a notice of funding opportunity (see 2 CFR § 200.306). Cost sharing occurs when a sponsor agrees to award only a portion of the total allowable costs of a sponsored program and the awardee is required to secure or provide the remaining portion of the program funds. For Federal awards, cost sharing or matching means the portion of project costs not paid by Federal funds (see 2 CFR § 200.29). Compliance with Federal cost accounting standards requires that cost sharing be proposed, accounted for and reported in a uniform manner. Cost sharing by the University, if a term of an award, represents a legally binding financial commitment. Therefore, cost sharing must support University objectives and not overburden University resources or compromise Facilities and Administrative (F&A) cost recovery, also referred to as indirect costs. Excessive or unnecessary cost sharing may cause a reduction in the University’s indirect cost rate or otherwise negatively impact the University, such as limiting resources for support of research and scholarship.
Cost sharing may be any combination of departmental or unit resources, waived indirect costs, third party resources or other university resources. Sponsored programs which include cost sharing require an extra level of administrative burden upon the principal investigator, performing unit and research administration to ensure compliance. Therefore, programs with cost sharing require approval by all relevant budget authorities for identified sources of cost sharing, including the Vice President of UDRI or the Vice President for Academic Research and the Provost and Executive Vice President for Academic Affairs before proposal submission or acceptance of award (in cases where there is no proposal or award requirements differ substantially from the proposal).
The following criteria apply when determining if cost sharing will be approved.
1. The sponsored program must align with the University’s mission and strategic goals for research and scholarship. Programs that meet this criteria may include those that will allow the University to:
a. Build upon an area of research or scholarship identified as a strategic priority,
b. Procure a large asset or piece of equipment that will improve the University’s competitiveness in pursuing future programs,
c. Support a junior faculty member in growing a research area,
d. Develop a relationship with a foundation or government agency that is likely to fund future efforts that align with strategic goals, or
e. Conduct a program that will significantly enhance the University’s reputation.
The amount of cost sharing should be commensurate with the degree of alignment of a program to the mission and goals outlined above. In addition, programs that require significant subcontracting and/or utilize significant administrative support will require greater justification for approval. Cost sharing that subsidizes activities that are expected to be self-sustaining is strongly discouraged.
2. For Academic Research, UD shall charge the maximum federally negotiated F&A or indirect cost rate to all sponsored projects, regardless of funding source if possible. However, some sponsors, particularly non-profit organizations, restrict F&A reimbursement to less than the standard rate negotiated with the federal government. If a sponsoring agency’s written policy will not allow full recovery of F&A costs, the University of Dayton may accept these reduced reimbursement rates, deeming them appropriate if the restriction is initiated by the sponsor, consistently communicated to all applicants, publicly shared (e.g., a written policy on a sponsor’s website), non-negotiable, and the proposed activities fit within the University of Dayton’s overall mission. The University does not require indirect cost sharing from the college, school or unit. Principal investigators need not request a policy exception; these are granted automatically.
For-profit sponsors shall be charged the full Federal F&A rate, regardless of their written policy.
3. Non-academic units, such as the Research Institute, will be responsible for funding the full amount of all cost sharing, including cost sharing of both direct and indirect costs. For these units, approval of cost sharing will reside with the Vice President of UDRI.
4. Academic units will be responsible for funding all voluntary direct cost sharing. Approvals will be required of the budget authority for each identified source of direct cost sharing. The principal investigator will be responsible for identifying the sources of, and securing approvals for, direct cost sharing.
In recognition of the need for the University to recover indirect costs to support research administration and fund other activities that further the University’s commitment to research and scholarship, there will be no return of indirect costs to academic units on programs with waived indirect costs. The Provost and Executive Vice President for Academic Affairs has final authority for approving cost sharing of indirect costs.
Responsibilities for Enforcement, Remedies, Sanctions
The Vice President for Academic Research and the Vice President of UDRI are responsible for administering this policy, developing procedures for implementation of this policy, and resolving issues related to the application of this policy.
Appeal Process
It is understood this policy cannot foresee all issues which may arise in the future; in such cases, the Vice President of UDRI, the Vice President for Academic Research, the Provost and Executive Vice President for Academic Affairs, and/or the Executive Vice President for Finance and Administrative Services, as appropriate, will consult to resolve such issues within thirty working days after the issues are brought to their attention.