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Understanding HUD Section 3

Section 3 is a provision of the Housing and Urban Development Act of 1968 that helps foster local economic development, neighborhood economic improvement and individual self-sufficiency.

The Section 3 program requires that recipients of certain HUD financial assistance, to the greatest extent possible, provide job training, employment, and contract opportunities for low- or very-low income residents in connection with projects and activities in their neighborhoods.

Section 3 Applicability

Section 3 applies to certain HUD-funded Housing and Community Development projects that exceed $200,000 or more to complete housing rehabilitation, housing construction, and other public construction. Applicability is determined at the project level.

For projects funded with Lead and Hazard Control and Healthy Homes Programs, Section 3 applies to projects that exceed $100,000.

Section 3 Worker

Persons seeking the Section 3 worker preference shall demonstrate that it meets one or more of the following criteria currently or when hired within the past five years, as documented:

  • A low or very low-income resident (the worker’s income for the previous or annualized calendar year is below the income limit established by HUD) (Austin Round Rock MSA income limits); or
  • Employed by a Section 3 business concern; or
  • A YouthBuild participant.

What is YouthBuild?

YouthBuild is a community-based pre-apprenticeship program that provides job training and educational opportunities for at-risk youth ages 16-24 who have previously dropped out of high school.

More information can be found here: https://www.dol.gov/agencies/eta/youth/youthbuild.

Targeted Section 3 Worker

Persons seeking the Targeted Section 3 worker preference shall demonstrate that it meets one or more of the following criteria:

(For Housing and Community Development Financial Assistance) - CDBG

  • Currently meets or when hired met 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 Part 75.5; or
  • A YouthBuild participant.

Section 3 Business Concern

To be considered a Section 3 Business concern, the business must meet one or more of the following criteria:

At least 51% of the business is owned and controlled by low- or very low-income persons; or

At least 51% of the business is owned and controlled by current public housing residents or residents who currently live in Section 8-assisted housing; or

Over 75% of the labor hours performed for the business over the prior three-month period are performed by Section 3 workers.

Section 3 Employment, Training, and Contracting

Travis County will be considered to have complied with the Section 3 requirements and met safe harbor, if they certify that they followed the required prioritization of effort and met or exceeded the Section 3 benchmarks, absent evidence of the contrary.

Prior to the beginning of work, contractors and subcontractors will be required to certify that they will follow the required prioritization of effort for Section 3 workers, Targeted Section 3 workers, and Section 3 business concerns. After completion of the project, contractors and subcontractors will be required to certify that they followed the prioritization of effort requirements.

Use HUD’s Opportunity Portal to search for jobs and training postings or post your resume.

Section 3 Outreach

In order to educate and inform workers and contractors, Travis County’s Section 3 Coordinator will be prepared to provide training and technical assistance on a regular basis per program guidelines. When training opportunities are available, contractors and subcontractors should, to the greatest extent feasible:

  • Notify the Section 3 Coordinator when training opportunities are available
  • Provide information/handouts about Section 3 training opportunities to potential Section 3 workers and Targeted Section 3 workers
  • Conduct an annual training for Section 3 workers and Section 3 businesses

Section 3 Coordinator

What is the HUD Section 3 Business Registry?

Register your Business on the HUD Section 3 Business Registry.

Find a HUD Section 3 Business.

Section 3 FAQs

You can find more information on HUD’s Section 3 website and their FAQs page.

Community Development Block Grant

P.O. Box 1748
Austin, TX 78767

Phone: (512) 854-3460

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Staff

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TAX RATE: TRAVIS COUNTY ADOPTED A TAX RATE THAT WILL RAISE MORE TAXES FOR MAINTENANCE AND OPERATIONS THAN LAST YEAR’S TAX RATE. THE TAX RATE WILL EFFECTIVELY BE RAISED BY 3.5 PERCENT AND WILL RAISE TAXES FOR MAINTENANCE AND OPERATIONS ON A $100,000 HOME BY APPROXIMATELY $10.39.

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