Solving the Matching Dilemma

Solving the Matching Dilemma

Session 32

Tuesday, May 24, 2011

National Extension and Research Officers Administrative

Conference

Anchorage, Alaska

Solving the Matching DilemmaPresented by:

Adriene WoodinBranch Chief

Awards Management DivisionOffice of Grants and Financial Management

[email protected]

202-401-4320

mailto:[email protected]

Solving the Matching Dilemma• NIFA Programs with Required Matching• Matching Regulations• Definitions• Do’s and Don’ts• What’s Not Acceptable Matching• What is Allowable as Matching• Common Matching Costs and Required Information• Matching Commitment Documentation• Valuing Donations• Summary

Programs With Required Matching

• The RFA will contain details on whether or not matching is required and what those requirements are.

• Programs requiring a matching commitment:• AFRI Equipment Awards

• 100% of Federal Funds• Cash match only


• Beginning Farmer and Rancher Development Program• 25% of Federal Funds

• Cash or in-kind• Third party contributions


• Specialty Crop Research Initiative (SCRI)• 100% of Federal funds

• Cash or in-kind• Third Party Contributions• Allows unrecovered indirect costs as matching

only on grantee provided matching costs


• Biomass Research and Development Initiative

• 20% of total project costs for Research projects• 50% of total project costs for Demonstration projects

• Total Project Costs consists of requested Federal funds and proposed matching

• Cash or in-kind• Third-party contributions


• Higher Education Challenge Grants • 100% of Federal funds

• Cash or in-kind

• Third Party contributions

• Community Food Program• 100% of Federal funds

• Cash or in-kind

• Third Party contributions


• Women and Minorities in STEM Fields• 100% of Federal funds

• Cash or in-kind• Third Party contributions

• Special Needs Program• 100% of Federal funds

• Cash or in-kind contributions• No Third-Party contributions permitted


• These programs require matching only when the subject area is commodity specific:• Geospatial and Precision Technologies• Integrated Programs

• 100% of total Federal funds• Cash or in-kind• Third-party contributions

Matching Regulations

• Governing regulations are:

• Office of Management and Budget (OMB) Circular A-110 (found at 2 CFR Part 215)• Sub-part C: Post Award Requirements, Financial and

Program Management• Section 23. Cost Sharing or matching• http://www.nifa.usda.gov/business/awards/ombcirculars.html

• USDA 7 CFR Part 3019• Section 3019.23 Cost Sharing or Matching• http://www.nifa.usda.gov/business/awards/fedregulations.html

http://www.nifa.usda.gov/business/awards/ombcirculars.html

http://www.nifa.usda.gov/business/awards/fedregulations.html

Matching Regulations

• Award document will reference 7 CFR part 3019 which is USDA’s implementing regulation for A-110

• Both provide guidance on allowable matching costs and how to value services and donated items

Definitions• Cash Matching: The recipient’s cash

outlay, including the outlay of money contributed to the recipient by non-Federal third-parties.• Examples: The recipient’s cost to

purchase an item of equipment for use on the project; Salaries for staff time committed to project; purchase of supplies; travel of project staff.

Definitions

• In-Kind Contribution: The value of non-cash contributions of property or services. Includes use of facilities, use or donation of equipment, supplies, and other non-expendable property.

Definitions

• Third Party Matching: Any contribution to the project by an organization other than the recipient.• Can include cash or in-kind contributions.

Do’s and Don’ts• Funds used as matching for NIFA Awards:

• Cannot be used as matching for another Federally-assisted project or program

• May not be provided by another Federal award or agency unless specifically authorized by Federal Statute

• Must be for costs incurred specifically for project during project period

Do’s and Don’ts• Entire amount of required matching must be

secured at time of award• No “contingencies” allowed (i.e. Pending approval,

submission, or earning)• Includes Continuation Awards

• First year plus future year commitments must be secured in advance

• The sources and amounts of all matching should be summarized as part of the budget justification as a separate narrative (not combined with the Federal funds narrative)

What’s Not Acceptable Matching?• Funds provided from another organization for

another, similar project.• Can’t use funds twice

• The value of equipment previously purchased by, or donated to the recipient. • The purchase or donation must be specifically for the

project• Equipment must be used specifically for this project and

pro-rated to project usage

What’s Not Acceptable Matching?• Income expected to be earned during the project

period.• All matching must be in place at time of award.

• The income will not have been earned by then.

• Indirect Costs over the allowable limit (with the exception of the SCRI Program).

• When indirect costs are limited by program authorization, the recipient cannot claim more than the allowable limit.

What’s Not Acceptable Matching?

• Some matching may be deemed unallowable during the review process requiring additional matching resources.

• Award may be reduced or may not be issued if required matching is not met.

What’s Allowable as Matching Costs?• Any costs which would normally be allowable

under the applicable cost principles (OMB A-21 or A-122) for Federal funds would be allowable as matching

• Except for unrecovered indirect costs (with one exception)

• Costs must be specifically identifiable and directly benefiting the project.

Common Matching Costs and Required Information

• Note: the same level of details required for justifying Federal funds is required for justifying matching funds.

• Salaries/wages for project personnel -provide the annual or hourly rate of pay, time commitment (number of hours, percentage of effort) and the task to be completed

• Salary rates deemed excessive may need to be justified


• Materials or Supplies – provide a list of materials or supplies expected to be purchased and an estimated cost for the item(s).

• Travel costs – provide the purpose and destination (if known), number of trips, number of travelers, and the cost per trip.


• Office Rent - when there is a need for an office away from the main campus, office rent may be charged as a direct cost to the award. • Facility must not be owned by the recipient organization

and rent can not be included as a part of the indirect cost pool.

• Rent must be pro-rated to the project if space is shared.• Provide monthly rental cost, square footage, and usage

information.


• Equipment costs – provide details of the type of equipment and how it will be used.• For an equipment purchase – include the

purchase price. • For donated used equipment - only the

depreciated value of the equipment at the time of donation may be used.


• Equipment costs (cont’d):• For donated new equipment – full purchase value of

newly purchased equipment if purchased specifically for the project.

• For loaned equipment - the value may not exceed the fair rental value.

• Provide details on how the value was determined and the amount of time it will be used.


• Volunteer staff time – same information as for salaries. • Rate of volunteer labor should be consistent

with that paid for similar work within the recipient’s organization or with that paid for similar work in the labor market.

• Excessive rates of pay for volunteer labor may need to be justified.

Valuing Donations

• Value of donated property (transfer of property ownership) should be based on fair market value at time of donation.

• Value should be established by an independent appraisal

Valuing Donations

• Value of donated space (usage) should not exceed the fair rental value of comparable space as established by an independent appraisal of similar space in the same area.• Value is not based on purchase price

Matching Commitment Documentation

• Recipient Matching Documentation:• Letter of Commitment signed by the

Authorized Representative• Must include the dollar amount of the

commitment and the dates of involvement (project period)

• Budget justification should include required detail information on matching costs

• How are matching funds being spent?


• Third-Party Cash and In-Kind Contributions:• Recipient organization should show third-party

contributions in “Other Direct Cost” section of the budget and budget narrative.

• If recipient organization is using the third-party cash match to pay for own expenses, the costs would be distributed in the applicable budget categories (i.e.travel, salaries, etc.) where they will be spent.

• Details on how funds are being spent must be provided.• Same level of details required as for Federal funds.


• Third-Party Cash and In-Kind Contributions:• Cost-sharing commitments by a Third-Party must

include Pledge Agreement from the contributing organization’s AR, counter-signed by the recipient organization’s AR.

• Counter-signature not required if submitted with the proposal

• Pledge agreement should also state whether the matching is cash or in-kind

Pledge Agreements

• Separate pledge agreement required for each donor.• Submitted on donor letterhead with the

name, address and telephone of organization

• Signed by AR of donor organization with title of person signing listed

Pledge Agreements

• Pledge agreements must include:• Title of project for which the donation is

being made• The dollar amount or good faith estimate of

the donation or contribution• At statement the donation will be made

during the grant period (dates)

Pledge Agreements

• Third-Party Cash Contributions:• Project costs to be incurred and paid by

the Third Party• Include information on how the funds will be

spent (i.e. salary, travel, materials and supplies – provide details on costs)

Summary• It is important that all matching is documented

with letters of commitment and cost justifications for both recipient and Third-party donors.

• An award with required matching cannot be issued until all matching has been verified as allowable, reasonable and secured.

• Continuation awards require matching verification for the entire length and amount of the award.

Questions?

For any questions regarding matching costs or any other grant issues, contact:

Awards Management Division – 202-401-4986

Adriene Woodin, Branch Chief – 202-401-4320

or [email protected]

Documents

Solving the Matching Dilemma