Section 37.530 - What criteria do I use in deciding whether to accept a recipient's cost sharing?You may accept any cash or in-kind contributions that meet all of the following criteria:
(a) In your judgment, they represent meaningful cost sharing that demonstrates the recipient's commitment to the success of the research project. Cash contributions clearly demonstrate commitment and they are strongly preferred over in-kind contributions.(b) They are necessary and reasonable for accomplishment of the research project's objectives.(c) They are costs that may be charged to the project under § 37.625 and § 37.635 , as applicable to the participant making the contribution.(d) They are verifiable from the recipient's records.(e) They are not included as cost sharing contributions for any other Federal award.(f) They are not paid by the Federal Government under another award, except:(1) Costs that are authorized by Federal statute to be used for cost sharing; or(2) Independent research and development (IR&D) costs, as described at 32 CFR 34.13(a)(5)(ii) , that meet all of the criteria in paragraphs (a) through (e) of this section. IR&D is acceptable as cost sharing, even though it may be reimbursed by the Government through other awards. It is standard business practice for all for-profit firms, including commercial firms, to recover their research and development (R&D) costs (which for Federal procurement contracts is recovered as IR&D) through prices charged to their customers. Thus, the cost principles at 48 CFR part 31 allow a for-profit firm that has expenditure-based, Federal procurement contracts to recover through those procurement contracts the allocable portion of its R&D costs associated with a technology investment agreement.