Grant Glossary Terms:Â
- In-Kind Support – Non-monetary support like time and effort, a room to hold programming or supplies you already possess that can be assigned a monetary value and used as matching fund in a budget
- Letter of Commitment – A letter from a project partner committing specific efforts or resources, such as money, to the project you are seeking funding for; must be signed by an authorized individual.
- Matching Funds – Money that is provided by you or a partner in addition to the request from the funder; funders sometimes require a certain amount of matching funds.
If you’ve ever looked at a grant opportunity and thought, “What are matching funds?” you’re not alone.
Matching funds can feel like a barrier to applying for grants, but they’re actually an opportunity to strengthen your project and demonstrate real community support. Once you understand how they work, they become much more manageable and even strategic.
What Are Matching Funds?
Matching funds are the portion of a project not covered by the grant. They represent your organization’s (or your partners’) investment in the project and may come from your organization, partners, or other supporters. Not every grant requires them, so always check the guidelines first.
Cash vs. In-Kind Match
Matching funds typically fall into two categories:
Cash match is direct funding contributed to the project. This can include savings, donations, loans, or contributions from partners. It’s usually easier to track and is often preferred by funders.
In-kind match includes non-cash contributions such as volunteer time, donated goods or services, or the use of space and equipment. While it can reduce out-of-pocket costs, it requires clear documentation and tracking.
Where Can Matching Funds Come From?
Matching funds can come from a variety of sources, including:
- Foundations and community funding
- Local banks or financing options
- Project partners contributing time, space, or resources
- Volunteers supporting project activitiesÂ
One of the most important strategies is to start early. Securing matching funds often takes time, especially when partnerships are involved.
Key Things to Keep in Mind
Before building your budget, remember:
- Federal funds typically cannot match other federal funds. Instead, federal grants will likely require matching funds from state, local, or private funders,
- Matching funds usually must be secured at the time of application. Some applications will allow you to list pending sources of match, so be sure to check the application’s guidelines.
- You cannot double-count matching funds across projects. This means you cannot use two sources to pay for exactly the same expense. Instead, sources should cover separate items or only a portion of an item’s costs.
- Requirements vary; always read the funding guidelines carefully!
How are Matching Funds Calculated?
Matching fund requirements vary by grant program. Some are based on the total project cost, while others are based on the requested grant amount.
When matching funds are based on the total project cost, you need to multiply the total of all the allowable expenses by the required match rate. For example, if your total project cost is $150,000 and the funder requires 30% to be covered by match, you would need $45,000 in match. You would be allowed to request the remaining $105,000.
On the other hand, some grant programs calculate matching funds based on the amount you are requesting. While this is less common, it is easier to calculate. For example, if a program requires a 25% match and you request $500,000, you would need to provide $125,000 in matching funds.
Budgeting and Documentation
Your application should clearly identify:
- The source of matching funds
- Whether they are cash or in-kind
- How they connect to your project budget
Most funders will also require letters of commitment from partners outlining their contributions.
Final Thoughts
Matching funds aren’t just a requirement; they’re a way to strengthen your application. By building partnerships, planning ahead, and clearly documenting your match, you can position your project for success.
If you need help identifying matching fund sources, structuring your budget, or navigating grant requirements, the West Virginia Grant Resource Centers are here to help. Request Assistance through the Grant Centers’ website and take the next step in moving your project forward.