Section 3 is a provision of the Housing and Urban Development Act of 1968, which recognizes that HUD funds are typically one of the largest sources of federal funding expended in communities through the form of grants, loans, entitlement allocations and other forms of financial assistance. This provision was updated in 1992 under 24 CFR Part 135. The final rule was published on September 28, 2020 and went into effect on November 30, 2020, which is outlined under 24 CFR Part 75. The changes in the final rule improve the effectiveness of Section 3, streamline some processes that have not yielded significant benefits, and encourage HUD grantees to focus on sustained employment for low- and very low-income individuals.
Section 3 is intended to ensure that when employment or contracting opportunities are generated because a covered project or activity necessities the employment of additional persons or the awarding of contracts for work, preference must be given to low- and very low-income persons or business concerns residing within the community where the project is located.
To ensure that economic opportunities generated from HUD funds for housing and community development, using best efforts to the greatest extent feasible, will be directed to:
- Low and very low-income persons - particularly those receiving assistance for housing,
- Low and very low-income workers of the community in which the Section 3 funds are spent, and
- Businesses that provide economic opportunities to these persons.
Reasonable efforts must be made to recruit, target, and direct economic opportunities to Section 3 Workers, Targeted Section 3 Workers and Section 3 business concerns. These efforts are expected to re-direct job and contracting opportunities to these workers and businesses rather than creating new jobs and contracts.
Cobb County’s Policy Statement
It is the policy of Cobb County herein described as the “County”, to ensure that Equal Employment Opportunities be provided for all employees and applicants for employment regardless of race, color, religion, sex, national, origin, handicap, or economic status; and that through the award of contracts to contractors, subcontractors, vendors, and suppliers, the County will ensure that employment and business opportunities be created for residents of CDBG eligible income areas, residents in low and moderate-income census tracts and block groups, and other qualified low and very low-income persons residing in Cobb County. This will be a continuous policy throughout all HUD funded programs in the County receiving federal grant assistance. The County intends to uphold its obligation to contractors, subcontractors, and vendors and incorporate practical initiatives of providing full-time permanent employment opportunities as well as business opportunities to low and moderate-income persons and other Section 3 eligible persons.