Hit your Section 3 benchmarks.
Prove the hours.
HUD Section 3 compliance without a manual labor-hour tally: tie hours to worker eligibility as the job runs, watch the running share against the 25 and 5 percent benchmarks, and assemble the HUD report from the same records.
Section 3 benchmarks
Riverside Family Housing
Both benchmarks, live. The running share of labor hours against the 25 percent Section 3 and 5 percent targeted benchmarks, updated as hours are reported.
Eligibility on the record. Worker certifications for Section 3 and targeted status are captured and stored with the hours, so the count is provable.
Report built as you go. The benchmark results and supporting hours assemble into the report HUD expects, without a separate spreadsheet at the deadline.
Worker eligibility
Verified on the record
Prove each worker qualifies.
A Section 3 worker qualifies by income, by employer, or by past status, and a targeted worker meets tighter criteria. We capture that certification and store it with the worker, so the hours behind your benchmark are provable, not asserted at reporting time.
Collect subcontractor payrollsCount the hours as they happen.
Section 3 is measured in hours, not intent. Labor hours are attributed to qualifying workers by trade and rolled up against both benchmarks as timecards come in, so a shortfall surfaces while there is still time to shift hours, not after the job closes.
Apprenticeship complianceLabor hours by trade
Why it matters
Section 3 is measured in labor hours over the whole project. Reconstruct it at reporting time and a shortfall shows up too late to hire differently, leaving a covered recipient to explain a missed benchmark to its funding agency instead of meeting it.
24 CFR Part 75 · HUD Section 3 labor-hour benchmarks
HUD Section 3 compliance FAQ
The questions contractors ask most about Section 3 benchmarks, eligibility, and reporting.
Section 3 is a HUD requirement that funding for housing and community development create employment and training opportunities for low-income people, especially residents of public housing. Contractors on covered projects must direct a share of labor hours to Section 3 workers and report those hours to demonstrate compliance.
Section 3 applies to covered projects above a funding threshold of $200,000, rising to $300,000 for funds committed on or after March 16, 2026. Below the threshold, the labor-hour benchmarks generally do not apply, though recipients still work toward the program’s employment goals.
There are two labor-hour benchmarks. At least 25 percent of total labor hours on a covered project should go to Section 3 workers, and at least 5 percent should go to targeted Section 3 workers. Both are measured as a share of all labor hours worked on the project.
A Section 3 worker is a worker whose income falls below HUD limits, or who is employed by a Section 3 business, or who was a Section 3 worker within the past five years. A targeted Section 3 worker meets tighter criteria tied to public housing residency or the project area.
You report the total labor hours on the project, the hours worked by Section 3 workers, and the hours worked by targeted Section 3 workers, along with the qualitative efforts made. HUD expects records that support the numbers, which is why tracking hours and eligibility as the job runs matters.
A project is Section 3 covered when the HUD funding on it exceeds the threshold, which is $200,000, rising to $300,000 for funds committed on or after March 16, 2026. We flag covered projects up front so labor hours and eligibility are tracked from day one, instead of reconstructed when the report is due.
No. We do not store Social Security numbers, and we never use your data to train shared models or share it across customers. Worker eligibility and labor-hour data is isolated to your organization, encrypted in transit and at rest, hosted in the US, and yours to export or delete at any time.
Keep reading
- Compliance platformComing soon
- Apprenticeship compliance
- Collect subcontractor payrolls
- Certified payroll audit
- Pass prevailing wage auditsComing soon