What is the definition of Cost sharing or matching?

Cost sharing or matching means the value of the third party contributions and portion of the costs of a federally assisted project or program not borne by the Federal Government.  The match may be either cash or in-kind contributions.

What is FEMA Cost-Share?

All Mitigation measures approved under the State’s grant will subject the cost sharing provisions established in the FEMA-State Agreement.  FEMA may contribute up to 75 percent of total project costs for projects approved under the Hazard Mitigation Grant Program (HMGP). (44 CFR 206.432 (a))

What is Non-Federal Cost Share?

A non-Federal source must contribute the remaining percentage of the total eligible project costs.  While the non-Federal match for the HMGP must be at least 25 percent, it is not necessary for the non-Federal match to be 25 percent on each individual project.  It is only necessary that the cost-share ratio for all combined HMGP projects for the disaster be at least 25 percent.

Do HMGP funds lose their Federal Identity?

HMGP funds do not lose their Federal identity and may not be used as match for another federally funded project, including U.S. Army Corp of Engineer projects.

What are In-Kind Contributions?

Property or services which benefit a federally assisted project or program and which are contributed by non-Federal third parties without charge to grantee, or a cost-type contractor under the grant agreement.

Examples of third party in-kind contributions include:

• A local attorney affected by the flood donates her time to review the real property acquisition contract documents and conduct the settlements for the sub-grantee.  The normal cost of the attorney’s professional time donated to the project (based on her normal per hour or per settlement rate) is allowable as local in-kind cost-share.
• A homeowner accepts 75 percent of the value of his home in cash and donates the rest of the appraised value to the project.  The remaining 25 percent donated value is allowable as a third party in-kind contribution.
• Local contractors donate their services to complete seismic retrofit work to residents’ homes.  The normal cost of their time is allowable as a third party in-kind contribution.
• The local hardware store donates construction materials for a hurricane shuttering project.  The retail value of those materials is an allowable third party in-kind contribution.

May private funds be used as match?

Individuals may use their own funds (including loans received from SBA, FHA, and Increased Cost of Compliance insurance claim payments) to help a local community to match HMGP funds.

Increased Cost of Compliance (ICC) coverage benefits under the National Flood Insurance Program (NFIP) may be used to match elevation and/or acquisition and relocate projects.  Increased Cost of Compliance Coverage provides for the payment of a claim to help pay for the cost to comply with a community floodplain management ordinance after a direct physical loss by flood.  When a structure is covered by a Standard Flood Insurance Policy sustains a flood loss and the State or community declares the building to be substantially damaged or repetitively damaged, ICC will help pay for the cost to elevate, flood proof (non-residential buildings only) demolish, or relocate the building.  The maximum ICC is $30,000.  All NFIP Regular Program policies with building coverage issued or renewed on or after June 1, 1997 will include the coverage.