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Section 3: Economic Opportunities for Low-Income Residents

Learn about Section 3 of the Housing & Urban Development Act, which promotes economic opportunities for low-income individuals through HUD financial assistance. Discover the eligibility criteria, preferences, compliance goals, and employment opportunities for residents and businesses.

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Section 3: Economic Opportunities for Low-Income Residents

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  1. SECTION 3

  2. HUD Section 3 web page: http://www.hud.gov/offices/fheo/section3/section3.cfm Merryl Gibbs, Program Analyst Merryl.Gibbs@hud.gov 617-994-8305

  3. Purpose of Section 3 Economic opportunities resulting from HUD financial assistance go to local low-income people.

  4. Statute and Regulation • Section 3 of the Housing & Urban Development Act of 1968 as amended. • HUD regulation: 24 CFR part 135

  5. Applies to: • Public and Indian Housing – all activities: Development, Modernization, Operation • Housing and Community Development – only: Housing Construction and Rehab, Other Public Construction • Covers – entire project or activity

  6. Thresholds • Public Housing: None – everything is covered • Housing and Community Development Threshold: • Project - exceeds $200K • Contractor/Subcontractors – exceeds $100K

  7. Section 3 Covered Employment • Public Housing: all employment • Housing and Community Development: includes construction jobs and also other project-related jobs – management, administrative, architectural, engineering, etc. • Includes municipal hiring for project management and administration

  8. Section 3 Preferences • Employment: Section 3 residents • Contracting: Section 3 Business Concerns

  9. Section 3 Resident • Public Housing Resident, or • Low-income resident of the project area (MSA or county).

  10. Section 3 Business • At least 51% owned by Section 3 Residents (local low-income people), or • At least 30% of employees are Section 3 Residents; or • At least 25% of subcontracts will go Section 3 Businesses (that meet criterion 1 or criterion 2 above).

  11. Compliance Goals • Employment – 30% of new hires • Contracting • Building trades work – 10% of total dollar amount • Other work – 3% of total dollars

  12. Section 3 Employment Preferences • PIH Programs – first, development & HA residents, then Youthbuild participants, then other Section 3 residents. • Housing and Community Development Programs – first, Section 3 residents residing in the project service area or neighborhood, then Youthbuild, then other Section 3 residents. Note: Youthbuild is a US Dept. of Labor (formerly HUD) program providing experience in construction jobs to low-income youth.

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