THIRD-PARTY LABOR COMPLIANCE MONITORING

HUD funding comes with a hiring obligation attached.

Projects funded with more than $200,000 in HUD housing and community development assistance must direct jobs and contracts to low-income workers and businesses, to the greatest extent feasible.

We track labor hours, verify worker eligibility, and prepare the reporting HUD requires, so your Section 3 compliance holds up to review.

Check which rules apply to your project
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30+ years

MONITORING PUBLIC WORKS

50 states

COVERAGE

Federal & State

DUAL JURISDICTION

Which projects this applies to

Section 3, under 24 CFR Part 75, applies to housing construction, rehabilitation, and demolition projects funded with more than $200,000 in HUD financial assistance. Since the 2020 final rule, compliance is measured by tracking labor hours worked by Section 3 workers, not by hiring counts, so accurate reporting matters more than it used to.

Small public housing agencies with fewer than 250 units may elect not to report on labor hours, and can instead report on qualitative efforts only. Worth confirming which category your project falls under.

The two requirements

Section 3 Workers

HUD tracks the number of labor hours worked by Section 3 workers against total labor hours worked on the project. HUD sets and periodically updates the benchmark recipients are expected to meet.

Targeted Section 3 Workers

A subset of Section 3 workers, typically public housing residents or Section 8 recipients, tracked separately against its own HUD benchmark. Meeting the general Section 3 benchmark doesn't automatically satisfy this one.

What happens if you miss it

Falling short of a benchmark isn't an automatic violation. HUD expects good faith efforts, documented outreach, training or apprenticeship opportunities, technical assistance to help Section 3 workers compete for jobs, even if the final numbers land under target.

What gets recipients into real trouble is missing documentation, not missing the benchmark itself. Contracts need Section 3 language built in from the start, and labor hours need to be tracked and reported accurately every reporting period.

We monitor it so you don’t have to guess

We track labor hours, verify Section 3 and Targeted Section 3 worker eligibility, build the required contract language in up front, and prepare your reporting before deadlines hit, not after.

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