Expense Allocation Across Multiple Grants

Most federally-funded grants are currently governed in part by a section of the Code of Federal Regulations known as “Uniform Guidance.”  These regulations address, amongst other things, the allocation of costs to projects.  Uniform Guidance states: “If a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost should be allocated to the projects based on the proportional benefit.”  If the proportional benefit cannot be determined because of the interrelationship of the work, the costs may be allocated on any reasonable basis, provided the usual allowable and reasonable principles are followed.

 What does this mean?

Using travel as one of many possible examples, if a trip will benefit more than one project, each type of cost must be split in the same proportion (typically as a percentage) based on the benefit provided to each project. For example, if three projects will benefit equally, when registering for the conference using a procard, the charge must be split equally three ways.  Occurring later, when purchasing the airline ticket for the conference, the expense must again be split equally three ways (a.k.a in the same proportion).  And, the same process must be followed for all costs reimbursed via a travel voucher after the trip.  It’s not appropriate to charge the registration fee to one grant, then the airline ticket to another, and then the reimbursable expenses to another – even if in total they are comparable amounts.

 A similar process must be applied to any other costs that are split across multiple sponsored projects irrespective of the type of cost or the method of payment (i.e. PRD, Purchase order, etc).