Section 3 Compliance

We help recipients of certain HUD financial assistance along with their contractors and subcontractors comply with Section 3 benchmarks and requirements.

Section 3 is a provision of the Housing and Urban Development Act of 1968. The purpose of Section 3 is to ensure that economic opportunities, most importantly employment, generated by certain HUD financial assistance shall be directed to low- and very low-income persons, particularly those who are recipients of government assistance for housing or residents of the community in which the Federal assistance is spent.

The requirements of Section 3 apply to all programs receiving public housing financial assistance regardless of the amount of assistance received from HUD. Section 3 also applies to projects with more than $200,000 in funding from housing and community development financial assistance programs. The threshold is $100,000 when the assistance is from the Lead Hazard Control and Healthy Homes programs, as authorized by Sections 501 or 502 of the Housing and Urban Development Act of 1970, the Lead-Based Paint Poisoning Prevention Act, and the Residential Lead-Based Paint Hazard Reduction Act of 1992.

Recipients of Section 3 covered funding, and their contractors and subcontractors must undertake efforts, to the greatest extent feasible, to provide employment and training opportunities arising from the project to Section 3 and Targeted Section 3 Workers and to provide contracting opportunities arising from the project to Section 3 Business Concerns. In order to meet Section 3 Safe Harbor, they must meet the Section 3 benchmark goals for labor hours worked and required prioritization of efforts for employment, training and contracting.

We help recipients develop Section 3 provisions and language to include in their project specifications and contracts with prime contractors for Section 3 covered construction projects. During construction, we then help the recipient assess contractor hiring and subcontracting needs, and monitor the compliance of the prime contractor and all subcontractors with those provisions. We also help with all needed record keeping and reporting.

If the contractors and subcontractors don’t meet the benchmark goals and requirements, they are required to submit the qualitative efforts they have performed. We help the recipients evaluate the efforts they have made and determine further enforcement action that may be required.

We can help recipients and subrecipients develop Section 3 policies and procedures and undertake their own efforts for Section 3 compliance. We also assist recipients with all aspects of record keeping and reporting.

We are experts on the new HUD Section 3 regulations and can quickly bring recipients up to speed with them to help ensure compliance.

We work with all types of Section 3 covered projects that are funded from a variety of federal sources such as Community Development Block Grant (CDBG), HOME Investment Partnership Program, Lead Hazard Control Grants and Public Housing Programs, as well as other programs.

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