What is Section 3?

It is a means by which HUD fosters local economic development, neighborhood economic improvement, and individual self-sufficiency. Section 3 is the legal basis for providing jobs for residents and awarding contracts to businesses in areas receiving certain types of HUD financial assistance.

Under Section 3 of the HUD Act of 1968, wherever HUD financial assistance is expended for housing or community development, to the greatest extent feasible, economic opportunities will be given to Section 3 residents and businesses in that area.

Section 3 Policy

Congress established the Section 3 policy to guarantee that the employment and other economic opportunities created by Federal financial assistance for housing and community development programs should, if possible, be directed toward low- and very-low income persons, particularly those who are recipients of government assistance for housing.

Who are Section 3 Residents?

Section 3 residents are:

  • Public housing residents or recipients of Section 8 assistance.
  • Low and very-low income persons who live in the jurisdiction where a HUD-assisted project for housing or community development is located.

Determining Income Levels

  • Low income is defined as 80% or below the median income of that area
  • Very low income is defined as 50% or below the median income of that area

HUD Estimate, San Diego County Income

Effective February 28, 2014

Household Size

50% of County Median Income

80% of County Median Income


























What is a Section 3 business and what types of economic opportunities are available under Section 3?

A Section 3 business:

  • That is at least 51 percent or more owned by Section 3 residents, or
  • Whose permanent, full-time employees include persons, at least 30 percent of whom are currently Section 3 residents, or within three years of the date of first employment with the business concern were Section 3 residents, or
  • That provides evidence of a commitment to subcontract in excess of 25 percent of the dollar award of all subcontracts to be awarded to a Section 3 business concern.

Types of Opportunities:

  • Job training
  • Employment
  • Contracts

How can a business find Section 3 residents to work for them?

Businesses can recruit at the neighborhood Resource Centers and through the Oceanside Housing Authority to inform residents about available training and job opportunities. Distributing flyers, posting signs, placing ads and contacting resident organizations and local community development and employment agencies to locate potential workers are effective ways of acquiring jobs and employees.