Cost Sharing in Grants and Cooperative Agreements to NGOs (AAPD 02-10)

Cost Share Clarification AAPD.pdf 89.1 KB

PURPOSE: The purpose of this AAPD is to clarify USAID’s policy regarding cost share under grants and cooperative agreements to non-governmental organizations, both non-profit and for profit, funded by USAID.

BACKGROUND: The most recent policy governing Cost Sharing was issued in a general notice in May, 1997. This notice made it clear that "USAID policy is that the principle of cost-sharing . . .should be flexible and case-specific.” However, Agency policy continued to direct an SO team to use 25 percent as a suggested reference point. It also required the team to justify the cost share required based on a review of the factors outlined in the USAID-U.S. PVO Partnership Paper. This led many to continue to require a 25 percent cost share in cases where it was not appropriate.

GUIDANCE: ADS 303 is being revised to eliminate the reference to a suggested 25 percent cost share; to change the requirement of a justification of the required cost share to an explanatory memorandum for documentation purposes; and to clarify that the authority to determine the appropriate cost share lies with the Activity Manager. In the interest of encouraging participation by a broader spectrum of NGOs in competing for an assistance award, it also states that cost share in excess of any established minimum may not be used as a separate evaluation factor for award.

Website (URL): http://www.usaid.gov/procurement_bus_opp/procurement/cib/aapd02_10.pdf

Author(s): USAID