Section 3 Certification Program Overview
The purpose of HUD’s Section 3 program is to provide employment, training and contracting opportunities to low-income individuals, particularly those who are recipients of government assistance for housing or other public assistance programs.
Eligibility Guidelines
The worker’s income must be at or below the amount provided below for an individual (household of 1) regardless of actual household size.
Individual Income Limits for the Omaha-Council Bluffs MSA (FY 2025): $63,700
See https://www.huduser.gov/portal/datasets/il.html for the most recent income limits.
Section 3 Benefits:
- Potential for Competitive Bidding Advantage: Under HUD regulations, recipients of federal funds and prime contractors must ensure a certain percentage of the project's total labor hours are performed by Section 3 Workers.
- Access to Exclusive Networking & Registries: The City of Omaha's Planning Department maintains a Section 3 Registry. Every contractor on the Section 3 Registry will be notified of any upcoming contracting opportunities with the City of Omaha's Planning Department.
- Business Development & Resources: The City of Omaha can assist contractors with navigating federal compliance requirements. Additionally, the City of Omaha can direct contractors towards other resources to assist with business development, SAM registration, etc.
Section 3 Business Concerns:
- At least 51 percent of the business is owned and controlled by low- or very low-income persons.
- At least 51 percent of the business is owned and controlled by current public housing residents or residents who currently live in Section 8-assisted housing.
- Over 75 percent of the labor hours performed for the business over the prior three-month period are performed by Section 3 workers.
Section 3 Worker Definition:
- A low or very low-income person (as established by HUD in the table above) 1; or
- Employed by a Section 3 business concern; or
- A YouthBuild participant.
Targeted Section 3 Worker Definition:
- Employed by a Section 3 business concern or
- Currently meets or when hired met at least one of the following categories as documented within the past five years:
- Living within 1 mile of the service area or neighborhood of the project
- A YouthBuild participant.
Frequently Asked Questions
What is Section 3?
Section 3 is a provision of the Housing and Urban Development Act of 1968. The purpose of Section 3 is to ensure that employment and other economic opportunities generated by certain HUD financial assistance shall, to the greatest extent feasible, and consistent with existing Federal, State, and local laws and regulations, be directed to low- and very low-income persons, particularly those who are recipients of government assistance for housing, and to business concerns which provide economic opportunities to low- and very low-income persons.
How are low-income and very low-income determined?
Low- and very low-income limits are defined in Section 3(b)(2) of the Housing Act of 1937 and are determined annually by HUD. These limits are typically established at 80 percent and 50 percent of the area median individual income. HUD income limits may be obtained from: https://www.huduser.gov/portal/datasets/il.html
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.
Do the Section 3 requirements apply to material only contracts?
No. Section 3 does not apply to material only contracts or those that do not require any labor. For example, a contract for office or janitorial supplies would not be covered by Section 3. In this example, Section 3 would be encouraged but not required. However, a contract to replace windows that includes the removal of existing windows and the installation of new windows would be covered due to the involvement of labor.
Are demolition projects covered by the requirements of Section 3?
Yes. Recipients of assistance covered by Section 3 should, where feasible, comply with Section 3 benchmarks.
Are funds provided to recipients so that they can comply with the requirements of Section 3?
No. Funding has not been appropriated for Section 3 compliance. Section 3 requirements are only triggered when the normal expenditure of covered funds results in employment, training, or contracting opportunities.
Are Section 3 workers or business concerns guaranteed employment or contracting opportunities under Section 3?
Section 3 is not an entitlement program; therefore, employment and contracts are not guaranteed. Low and very low-income individuals and Section 3 business concerns must be able to demonstrate that they have the ability or capacity to perform the specific job or successfully complete the contract that they are seeking