(a) A State is entitled to receive two (2) dollars of Federal funds
for every one (1) dollar of State match expenditures, up to the amount
available for allotment to the State based on the State's percentage
for WtW formula grant for the fiscal year. The State is not required to
provide a level of match necessary to support the total amount
available to it based on the State's percentage for WtW formula grant.
However, if the proposed match is less than the amount required to
support the full level of Federal funds, the grant amount will be
reduced accordingly (section 403(a)(5)(A)(i)(I)).
(b) States shall follow the match or cost-sharing requirements of
the ``Common Rule'' Uniform Administrative Requirements for Grants and
Cooperative Agreements to State and Local Governments (codified for DOL
at 29 CFR 97.24). Paragraphs (b)(1)(i) and (ii), (b)(3), and (b)(4) and
(c)(1) of this section are in addition to the common rule requirements.
Also, paragraphs included in the common rule which relate to the use of
donated buildings and other real property as match have been excluded
from this provision.
(1) Only costs that would be allowable if paid for with WtW grant
funds will be accepted as match.
(i) Because the use of Federal funds is prohibited for construction
or purchase of facilities or buildings except where there is explicit
statutory authority permitting it, costs incurred for the construction
or purchase of facilities or buildings shall not be acceptable as match
for a WtW grant.
(ii) Because the costs of construction or purchase of facilities or
buildings are unallowable as match, the donation of a building or
property as a third party in-kind contribution is also unallowable as a
match for a WtW grant.
(2) A match or cost-sharing requirement may be satisfied by either
or both of the following:
(i) Allowable costs incurred by the grantee, subgrantee or a cost
type contractor under the assistance agreement. This includes allowable
cost borne by non-Federal grants or by others and cash donations from
non-Federal third parties.
(ii) The value of third party in-kind contributions applicable to
the FY period to which the cost-sharing or matching requirement
applies.
(3) No more than seventy-five percent (75%) of the total match
expenditures may be in the form of third party in-kind contributions.
(4) Match expenditures must be recorded in the books of account of
the entity that incurred the cost or received the contribution. These
amounts may be rolled up and reported as aggregate State level match.
(c) Qualifications and exceptions--
(1) The matching requirements may not be met by the use of an
employer's share of participant wage payments (e.g., employer share of
OJT wages).
(2) Costs borne by other Federal grant agreements. A cost-sharing
or matching requirement may not be met by costs borne by another
Federal grant. This prohibition does not apply to income earned by a
grantee or subgrantee from a contract awarded under another Federal
grant.
(3) General revenue sharing. For the purpose of this section,
general revenue sharing funds distributed under 31 U.S.C. 6702 are not
considered Federal grant funds.
(4) Cost or contributions counted towards other Federal cost-
sharing requirements. Neither costs nor the values of third party in-
kind contributions may count towards satisfying a cost-sharing or
matching requirement of a grant agreement if they have been or will be
counted towards satisfying a cost-sharing or matching requirement of
another Federal grant agreement, a Federal procurement contract, or any
other award of Federal funds.
(5) Costs financed by program income. Costs financed by program
income, as defined in 29 CFR 97.25, shall not count towards satisfying
a cost-sharing or matching requirement unless they are expressly
permitted in the terms of the assistance agreement. (This use of
general program income is described in 29 CFR 97.25(g)).
(6) Services or property financed by income earned by contractors.
Contractors under a grant may earn income from the activities carried
out under the contract in addition to the amounts earned from the party
awarding the contract. No costs of services or property supported by
this income may count toward satisfying a cost-sharing or matching
requirement unless other provisions of the grant agreement expressly
permit this kind of income to be used to meet the requirement.
(7) Records. Costs and third party in-kind contributions counting
towards satisfying a cost-sharing or matching requirement must be
verifiable from the records of grantees and subgrantee or cost-type
contractors. These records must show how the value placed on third
party in-kind contributions was derived. To the extent feasible,
volunteer services will be supported by the same methods that the
organization uses to support the allocability of regular personnel
costs.
(8) Special standards for third party in-kind contributions.
(i) Third party in-kind contributions count towards satisfying a
cost-sharing or matching requirement only where, if the party receiving
the contributions were to pay for them, the payments would be allowable
costs.
(ii) Some third party in-kind contributions are goods and services
that, if the grantee, subgrantee, or contractor receiving the
contribution had to pay for them, the payments would have been an
indirect costs. Cost sharing or matching credit for such contributions
shall be given only if the grantee, subgrantee, or contractor has
established, along with its regular indirect cost rate, a special rate
for allocating to individual projects or programs the value of the
contributions.
(iii) A third party in-kind contribution to a fixed-price contract
may count towards satisfying a cost-sharing or matching requirement
only if it results in:
(A) An increase in the services or property provided under the
contract (without additional cost to the grantee or subgrantee) or
(B) A cost savings to the grantee or subgrantee.
(iv) The values placed on third party in-kind contributions for
cost-sharing or matching purposes must conform to the rules in the
succeeding sections of this part. If a third party in-kind contribution
is a type not treated in those sections, the value placed upon it must
be fair and reasonable.
(d) Valuation of donated services.
(1) Volunteer services. Unpaid services provided to a grantee or
subgrantee by individuals must be valued at rates consistent with those
ordinarily paid for similar work in the grantee's or subgrantee's
organization. If the grantee or subgrantee does not have employees
performing similar work, the rates must be consistent with those
ordinarily paid by other employers for similar work in the same labor
market. In either case, a reasonable amount for fringe benefits may be
included in the valuation.
(2) Employees of other organizations. When an employer other than a
grantee, subgrantee, or cost-type contractor furnishes free of charge
the services of an employee in the employee's normal line of work, the
services must be valued at the employee's regular rate of pay exclusive
of the employee's fringe benefits and overhead costs. If the services
are in a different line of work, paragraph (d)(1) of this section
applies.
(e) Valuation of third party donated supplies and loaned equipment
or space.
(1) If a third party donates supplies, the contribution must be
valued at the market value of the supplies at the time of donation.
(2) If a third party donates the use of equipment or space in a
building but retains title, the contribution must be valued at:
(i) the fair rental rate of the equipment or space for property
donated by non-governmental entities, or
(ii) a depreciation or use-allowance based on the property's market
value at the time it was donated for property donated by governmental
entities.
