Section 3, a provision of the Housing and Urban Development Act of 1968, ensures that employment and training opportunities arising in connection with Section 3 covered projects are, to the greatest extent feasible, and consistent with existing federal, state, and local laws and regulations, provided to Section 3 workers (i.e., workers who are low- or very low-income, employed by a Section 3 business concern, or participants of YouthBuild). Where feasible, priority is given to Section 3 workers living within the service area or the neighborhood of the project or to YouthBuild participants. Section 3 covered activities include housing rehabilitation, housing construction, and other public construction.
Section 281 of the National Affordable Housing Act requires that recipients of HUD financial assistance reach out to disadvantaged, minority, and women-owned business enterprises (DBE/MBE/WBE) for all contracting activities facilitating the provision of affordable housing authorized under federal law.
Section 3 and DBE/MBE/WBE covered projects may be funded by one or a combination of the following federal sources administered by the Montana Department of Commerce: the HOME Investment Partnerships Program (HOME), the Housing Trust Fund (HTF) Program, or the Community Development Block Grant (CDBG) Program.
The July 2021 (final rule) version of this toolkit applies to Section 3 covered projects with funds committed on or after November 30, 2020. The October 2019 (interim rule) version of this toolkit applies to Section 3 covered projects with funds committed before November 30, 2020.
HUD has indicated that the statutory, regulatory, and reporting requirements of Section 3 are not waived due to COVID-19. Additionally, HUD has indicated that Section 3 covered recipients and contractors are still required to provide notice of Section 3 opportunities; however, because noticing may not be possible in conventional ways, HUD encourages virtual methods (e.g., telephone blast messages, text messages, emails, Facebook ads, Twitter/Instagram ads, YouTube videos) and notes that all outreach, virtual or otherwise, must be documented.
For project-specific Section 3 and DBE/MBE/WBE guidance, please contact your program specialist.
