Section 3

Contractors and subcontractors should, to the greatest extent feasible, give priority for employment and training opportunities to:

1. Low- and very low-income persons residing within the metropolitan area (or nonmetropolitan county) in which the assistance is expended; or
2. Section 3 workers residing within the service area or the neighborhood of the project, and
3. Participants in YouthBuild programs

Contractors and subcontractors should, to the greatest extent feasible, give priority for awarding contracts and subcontracts to Section 3 business concerns that provide economic opportunities to:

1. Low- and very low-income persons residing within the metropolitan area (or nonmetropolitan county) in which the assistance is expended; or
2. Section 3 business concerns that provide economic opportunities to Section 3 workers residing within the service area or the neighborhood of the project, and
3. Participants in YouthBuild programs

Any worker who currently fits or when hired within the past five years fit at least one of the following categories, as documented:

• The worker’s income for the previous or annualized calendar year is below the income limit established by HUD.
• A worker who is employed by a Section 3 business concern; or
• The worker is a YouthBuild participant.

Based on the source of HUD funding, a Targeted Section 3 Worker definition has a different meaning:

A Targeted Section 3 Worker for public housing financial assistance means a Section 3 worker who is:

1. A worker employed by a Section 3 business concern; or
2. A worker who currently fits or when hired fit at least one of the following categories as documented within the past five years:
   • A resident of public housing; or Section 8-assisted housing;
   • A resident of other public housing projects or Section 8-assisted housing managed by the PHA that is providing the assistance; or
   • A YouthBuild participant.

A Targeted Section 3 Worker for housing and community development financial assistance project means a Section 3 worker who is:

1. A worker who is employed by a Section 3 business concern or
2. A worker who currently fits or when hired fit at least one of the following categories as documented within the past five years:
   • Living within the service area or the neighborhood of the project, as defined in 24 CFR 75.5
   • A YouthBuild participant.

A Section 3 Business Concern means:

A business concern meeting at least one of the following criteria, documented within the last six-month period:

1. It is at least 51 percent owned and controlled by low- or very low-income persons;
2. Over 75 percent of the labor hours performed for the business over the prior three-month period are performed by Section 3 workers; or
3. It is a business at least 51 percent owned and controlled by current public housing residents or residents who currently live in Section 8-assisted housing.

To demonstrate compliance with Section 3, contractors and subcontractors are required to meet or exceed the applicable benchmarks below:

1. Twenty-five (25) percent or more of the total number of labor hours worked by all workers on a Section 3 project must be done by Section 3 workers.
2. Five (5) percent or more of the total number of labor hours worked by all workers on a Section 3 project must be done by Targeted Section 3 workers.

Additional reporting if Section 3 benchmarks are not met includes but not limited to:

• Engage in outreach efforts to generate job applicants who are Targeted Section 3 workers.
• Provide training or apprenticeship opportunities.
• Provide technical assistance to help Section 3 workers compete for jobs (e.g., resume assistance, coaching).
• Clearly indicate Section 3 eligibility on all job postings, notifications, and advertisements with the following statement: “This is a Section 3 eligible job opportunity. We encourage applications from individuals that are low-income, live in public housing, and/or receive a Section 8 voucher.”
• Provide or connect Section 3 workers with assistance in seeking employment including: drafting resumes, preparing for interviews, and finding job opportunities connecting residents to job placement services.
• Hold one or more job fairs.
• Provide or referred Section 3 workers to services supporting work readiness and retention (e.g., work readiness activities, interview clothing, test fees, transportation, childcare).
• Provide assistance to apply for/or attend community college, a four-year educational institution, or vocational/technical training.
• Assist Section 3 workers to obtain financial literacy training and/or coaching.
• Engage in outreach efforts to identify and secure bids from Section 3 business concerns.
• Provide technical assistance to help Section 3 business concerns understand and bid on contracts.
• Divide contracts into smaller jobs to facilitate participation by Section 3 business concerns.
• Provide bonding assistance, guaranties, or other efforts to support viable bids from Section 3 business concerns.
• Promote use of business registries designed to create opportunities for disadvantaged and small businesses.
• Outreach, engagement, or referrals with the state one-stop system as defined in Section 121(e)(2) of the Workforce Innovation and Opportunity Act.