Despite their documented benefits, the widespread adoption of community-engaged and participatory approaches among health researchers remains limited. Institutional practices and policies influence the uptake of community engagement and participatory approaches. We examine the role of financial arrangements between university researchers and community partners, by exploring efforts to bridge the gap between research administration and researchers at two research-intensive institutions. The type of financial arrangement a researcher has with a community partner plays an important role in setting the stage for the structure of the partnership as it relates to shared decision-making and ownership of the research. Continued efforts to clarify and streamline subcontracting processes are needed as is infrastructure to support community partners and researchers as they navigate financial arrangements if progress is to be made.