In the context of grants, what is "cost-sharing"?

Cost-sharing refers to the portion of project costs that are not borne by the federal funds provided for the grant but rather covered by other sources. This can include contributions from the grantee’s own resources, funds from third parties, or any non-federal support. Cost-sharing is often required by funding agencies to demonstrate the grantee's commitment to the project and to ensure that the proposed project has additional financial backing beyond what is supplied by the grant. This practice helps to leverage federal funding and indicates that the project has widespread support and viability.

In the context of grants, recognizing the significance of cost-sharing is essential because it plays a crucial role in budgeting, financial accountability, and the overall success of the funded project. It is also important for ensuring that funds are allocated efficiently across different aspects of a project.