Properly valuing existing assets used as in-kind match is one of the most important compliance requirements for BEAD subgrantees. Federal regulations establish clear standards for how these contributions must be calculated and documented; failure to comply with those requirements can result in rejected match contributions or otherwise jeopardize your funding request.

Question: How do you value existing assets as in-kind match?

Answer: Under 2 CFR 200.306, cost sharing requires that the value of donated or contributed property reflect the remaining life of the asset as recorded in the subgrantee’s accounting records at the time of donation. When a subgrantee contributes existing assets such as previously purchased fiber, conduit, poles, or network equipment as in-kind match, the valuation must account for depreciation and the asset’s remaining useful life rather than original purchase price or full replacement cost.

Two primary valuation methods are available. The first is the depreciated replacement cost method, where the current cost to replace the asset is reduced to reflect the portion of its useful life already consumed. Only the portion attributable to the BEAD project is then allocated as match. The second method is prorated original cost based on remaining useful life, which starts with the actual cost paid for the asset, reduces that amount to reflect how much useful life remains, and then allocates the portion used by the BEAD project.

Regardless of which method is used, all valuations must be: 

• Verifiable in the contributor’s records, 
• Reasonable and necessary for project goals, and 
• Included in the approved budget

The methods used must be consistent and defensible, and contributions must be supported by letters of commitment, attestation forms, and detailed valuation justifications. Depreciated assets are only eligible if they retain genuine utility and value. Also note that Build America, Buy America (BABA) requirements apply to physical assets used as in-kind match.

Key takeaways

Valuing existing assets as in-kind match requires more than simply stating what was originally paid or what it would cost to replace. The Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (2 CFR 200) demand that subgrantees apply depreciation, account for remaining useful life, and allocate only the portion of the asset dedicated to the BEAD project. 

Whether using the depreciated replacement cost method or the prorated original cost method, applicants must ensure their valuations are well-documented, defensible, and compliant with both 2 CFR 200.306 and BABA requirements. Getting this right from the outset will protect a subgrantee’s matching contributions, reduce audit risk, and establish a strong foundation for fiscal and programmatic compliance.

Legal disclaimer

CTC is not a law firm. Our analysis and recommendations are based on our industry knowledge, experience, and understanding of applicable federal and state rules and regulations. Subgrantees should consult with their attorneys on any contract language.