Section 3 Job Creation

Visit our Training and Workshops page for various presentations and workshops. For grantees needing technical assistance on any of the templates or forms, it is recommended to submit electronic versions to

Community Development Block Grants (CDBG) provided in whole or in part with U.S. Department of Housing and Urban Development (HUD) funds need to comply with the Section 3 provision of the Housing and Community Development Act (HCDA) of 1968. Section 3 is a provision that helps foster local economic development, neighborhood economic improvement, and individual self-sufficiency. Office of Community Investment (CI) grantees need to provide, to the greatest extent feasible, job training, employment, and contracting opportunities generated because of CDBG covered projects, to low and very-low income residents in connection with projects and activities in their neighborhoods. 

Program Goals

The Section 3 regulations established thresholds and goals at 24 CFR 135.30:

  • 30 % of the aggregate number of new hires shall be Section 3 residents
  • 10 % of the total dollar amount of all covered construction shall be awarded to Section 3 business concerns.
  • 3 % of the total dollar amount of all covered non-construction contracts shall be awarded to Section 3 business concerns.

These numerical goals are minimum targets that must be reached in order for CI to consider a recipient in compliance. Grantees and their contractors must adequately document all efforts taken to comply with the requirements of Section 3, and explain why despite their efforts ―to the greatest extent feasible ― the minimum numerical goals were not met.

New Section 3 Handbook

A supplemental technical assistance guide for grantee compliance with Section 3 is now available

CI Section 3 Technical Assistance Handbook 08/2012

Required Forms for Grantees

Every grantee needs to adopt a Section 3 Plan. A recommended template is provided below by the Office of Community Investment (CI).  Please note that there is no prior approval of the above documents by Compliance Staff before the local government adopts the plan. However, if technical assistance is needed, please email

Section 3 Plan New 8/2012- Effective for 2012 Grantees

All grantee public notices need to have a limited English proficiency (LEP) phrase for the public to request translation or interpretation services concerning the information in the notice.  All contracts must include the Section 3 clause found at 24 CFR 135.38.  All grantees must submit the Section 3 report using HUD Form 60002 as part of the Annual Performance Report (APR) process. 

LEP Phrase for Public Notices  
Section 3 Clause  
HUD Form 60002 

Section 3 Business Certification

CI has developed a database in which businesses can be made aware of opportunities in local areas. To become a certified Section 3 Business, businesses must complete CI self-certification form. Please mail the certification forms to our office. 
Self-Certification for Section 3 Business Concern 
Registration for Section 3 Business Concern Listserv 

Section 3 Coordinators

CI has a database for Section 3 Coordinators that are located across the state of North Carolina. The goal is to inform these coordinators about economic opportunities when CDBG funds are being expended in local areas. Please email a completed registration form to  if you are interested in learning more about these opportunities for Section 3 qualified residents and businesses from your area, and if you would like to be added to our listserv. 


Grantees should submit bid documents to the North Carolina Interactive Purchasing System (IPS) as well as emailing them to so they can be sent out on our Section 3 listservs.

Section 3 Complaints

Any Section 3 Resident or Section 3 Business (or authorized representative) seeking employment, training, or contracting opportunities generated by Section 3 covered assistance may file a complaint using HUD Form 958, available on HUD’s website. Effective November 2007, Section 3 complaints must be filed at the appropriate HUD Fair Housing and Equal Opportunity Regional Office where the violation occurred. 

Complainants can also visit the U.S. Equal Employment Opportunity Commission or the U.S. Department of Labor Office of Federal Contract Compliance Programs.

HUD Section 3

HUD Section 3

Resources and Guidance

HUD Section 3 Website 
HUD Section 3 Program Overview 
HUD Section 3 Reporting Guidance 
HUD Income Limits 
HUD Section 3 Resident Training/Employment 
HUD Section 3 FAQ’s 
HUD, Section 3, and ARRA Funding 
HUD Examples of Training and Employment Opportunities, Awarding Contracts, and Preferential Procurement Procedures (Appendix to 24 CFR Part 135) 
HUD Youthbuild Program 
HUD Section 3 Brochure- EnglishSpanish 
NC Institute of Minority Economic Development 
Section 3 Regulations 
CDBG Procurement Rules 
Section 3 Information Fact Sheet
Section 3 CI Monitoring Checklist 
HUD CPD Monitoring 
Employment and Contracting Opportunities at 24 CFR 570.607(b) 
HUD Federal Register, Volume 73, No. 249, Page 79552 
HUD Community Development and Planning (CPD) Memo: Notice to Submit Form HUD-60002 on Section 3 Hiring and Contracting, 10/08/2009 
HUD Section 3 Press Release: HUD Steps Up Enforcement of Job Creation Requirements for State and Local Governments, 03/08/2010 
Section 3 ArticleReforming HUD’s Section 3 Requirements Can Leverage Federal Investments in Housing to Expand Economic Opportunity, 06/10/2009 

Sample Forms


Section 3 Employment Goals Plan 
Section 3 Resident Concern Self-Certification (1)
Section 3 Resident Self-Certification (2)
Section 3 Business Certification
Bid Advertisement
Section 3 Business and Employment Notice
Bidders Proposed Section 3 Contract-Subcontractors
Contractors Section 3 Business Utilization Report
Bidders Section 3 Estimated New Hires
Contractor Section 3 New Hires Report
CDBG Contract and Subcontractor Activity Report
Section 3 Business Determination of Classification
Section 3 Plan Statement of Commitment
Section 3 Questionnaire for Grantees and Contractors
Ways to Meet Your Section 3 Employment Goal
Training Sherwin Williams Flyer English/Spanish
Visible Signs at the Project Site


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