be a motivation for imposing this requirement even though some federal agencies have issued policies that prohibit the use of cost sharing or matching only to stretch program budgets. According to a Department of Health and Human Services Grants Policy Directive, “Matching or cost sharing may not be required through administrative action solely as a means of offsetting budget reductions” (DHHS, 1999).

Cost-sharing and matching requirements also can serve to leverage new sources of funding. Indeed, some organizations may specifically orient their giving to take advantage of such arrangements. According to a report on trends in U.S. funding for biomedical research, for example, the Pew Charitable Trusts “have attempted to identify a place within the biomedical research funding community where their support can be effectively leveraged to achieve the greatest impact” (University of California, 1996). Other programs, such as the California Breast Cancer Research Program (see Appendix A), have adopted the same strategy.

Cost sharing or matching also can help assure real commitment to projects by participants, which may be particularly true for technology development programs, where cost sharing can provide some assurance that a company views a project as a promising one. The Advanced Technology Program of the National Institute of Standards and Technology, for example, imposes strict cost-sharing requirements for its grantees (see Appendix A). A National Research Council assessment (2001) notes that this feature keeps the program anchored in the market economy and focused on efficiency and the bottom line. It also provides a mechanism for weeding out unpromising research approaches.

However, a number of potential negative effects of the cost-sharing or matching mechanism also have been identified (Feller, 1997, 2000a, 2000b; Hardy, 2000; Seligman, 2000). It might, for example, shift funding from other related projects and thus not yield a net benefit to the advancement of knowledge. In addition, the pot of money available for research on a given topic would be unlikely to change if CDMRP imposed cost-sharing or matching requirements; what might change, however, is the decisionmaking process of the organizations responsible for administering research funding. If organizations—for example, those dedicated to supporting research on a specific disease—perceive that investigations will no longer be supported by CDMRP unless they provide funds, they may divert resources from other projects to meet this requirement.

Cost sharing or matching also would impose additional costs on applicants, their institutions, and CDMRP, because applicant and institutional costs include those incurred in the process of identifying and accounting for sources of matching funds. This entails having more staff and spending more time preparing funding proposals. Often, the principal investigator loses valuable research time in order to participate in proposal preparation. For CDMRP, this would mean an increase in proposal review time and effort as well as the need to provide auditing to ensure that the cost sharing is legitimate and not doubly counted as cost sharing

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