The Crusader Newspaper Group

Section 3 of the HUD Act

Beyond the Rhetoric

By Harry C. Alford

This is a program that is designed to provide job training and business development opportunities for people living in public housing or under the poverty level. It was first written in 1968 because of the first Watts Riot in Los Angeles. It was rewritten and strengthened in 1992 because of the Rodney King riots in Los Angeles.

We first became aware of the program in 1993 when James Alford of Jacksonville, Florida, filed a Section 3 complaint against Jacksonville Public Housing. Mr. Alford (no relation) received a Voluntary Compliance Agreement. That meant that there was finding and merit in his complaint and the Jacksonville Public Housing Authority agreed to come to terms with compliance. James and his wife Maggie received a $20,000 settlement and were assured that they would not be discriminated against any longer.

So here we are in the year of 2018 and James and Maggie are still waiting on the discrimination in the Jacksonville Public Housing Authority to end. It is a great law with a promise of economic development, business creation and wealth building but compliance eludes us. So just what is Section 3. It is guided by Code of Federal Regulation 24CFR Part 135: (a)Section 3. The purpose of Section 3 of the Housing and Urban Development Act of 1968 ( 12 U.S.C. 1701u) (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.

(b)Part 135. The purpose of this part is to establish the standards and procedures to be followed to ensure that the objectives of section 3 are met. . . .

Contractor means any entity which contracts to perform work generated by the expenditure of Section 3 covered assistance, or for work in connection with a Section 3 covered project.

Employment opportunities generated by Section 3 covered assistance means all employment opportunities generated by the expenditure of Section 3 covered public and Native American housing assistance (i.e., operating assistance, development assistance and modernization assistance, as described in §135.3(a)(1)). With respect to Section 3 covered housing and community development assistance, this term means all employment opportunities arising in connection with Section 3 covered pro- jects (as described in §135.3(a)(2)), including management and administrative jobs connected with the Section 3 covered project. Management and administrative jobs include architectural, engineering or related professional services required to prepare plans, drawings, specifications, or work write-ups; and jobs directly related to administrative support of these activities, e.g., construction manager, relocation specialist, payroll clerk, etc.

Section 3 firms which are contractors who hire Section 3 workers (living under the poverty level) are set aside 10% of all HUD funded contracts. They must hire Section 3 workers to comprise 30% of the entire workforce.

During the post Katrina rebuild we achieved 3.2 billion dollars in Black business contracts. We applied Section 3 whenever possible. However, there were unforeseen challenges. Many of the public housing residents did not want to work. They resisted these new job opportunities. Many preferred to hustle in the streets for money as opposed to doing 9 – 5 gigs. Also, tenant associations were an obstacle. They considered us invading onto their turf of authority. They were “Poverty Pimps” not wanting outside interests in making job opportunities for the residents. It was a power struggle.

The two most successful programs we have seen were in Columbus, OH, managed by Smoot Construction and San Francisco Bayview Projects under the Mayor Willie Brown management. Both were not long-term due to stiff resistance from white construction unions who consider public housing their personal hustle.

So, here we are today in 2018 and we have a new HUD Secretary, Ben Carson, who has said on a few occasions that he wants to exercise Section 3. Well Secretary Carson, the National Black Chamber of Commerce replies, “Bring it on!” We know this and are ready, willing and capable to spread the application of this nearly 50 years old regulation throughout our nation for once and for all. We know the program, can implement it and make it a total success despite the racist construction unions. The time in now!

If we need to challenge his words, we will do so. Time is truly passing and there is no guarantee. We must move to take our brothers and sisters living under the poverty level to job training and career building. Our patience is running out. It is good to hear a Cabinet Secretary state the need for Section 3 and, damn it we are set to react in a very aggressive and positive fashion.

Mr. Alford is the Co-Founder, President/CEO of the National Black Chamber of Commerce®. Website: Email: [email protected].

Recent News

Scroll to Top