Section 3 Business Concerns are businesses that can provide evidence that they meet one of the following criteria:

1. 51 percent or more of the business is owned by Section 3 Residents; or
2. At least 30 percent of its permanent full time employees include persons that are currently Section 3 Residents, or were Section 3 Residents within three years of the date of first hire; or
3. A business that notes a commitment to subcontract in excess of 25 percent of the dollar award of all subcontracts to business concerns that meet one of the first two qualifications above.

HACLA has developed a Section 3 Business Registry, which is a database of businesses that have self-certified that they meet one of the eligibility criteria of a Section 3 Business Concern in accordance with 24 CFR Part 135. HACLA uses its Section 3 Business Registry as a resource to contract with Section 3 Businesses and refer them to prime contractors for subcontracting opportunities. We continuously update the Registry and make it available to the public for the benefit of all. Any referral or contract obtained from the Registry does not constitute or imply an endorsement by HACLA or its representatives. Neither HACLA, nor any of its employees, makes any warranty, express or implied, including qualifications, fitness to complete particular job, or assumes any legal liability for the accuracy, completeness, or usefulness of any information contained in the Registry. 

HACLA has adopted a bid preference for Section 3 Business Concerns when awarding Section 3 Covered Contracts using the Invitation for Bids (IFB) method of solicitation for services and for construction and maintenance activities. The bid preference requires that the IFB be awarded to the qualified Section 3 Business Concern with the highest priority ranking and with the lowest responsive bid if the bid meets certain criteria. In addition, when you register as a Section 3 Business Concern, your business name is added to our database and you are notified of contracting opportunities with HACLA and with its prime contractors for subcontracting opportunities.

Bid Preference Table

When the lowest responsive bid is:	Section 3 Business Concern bid is within lesser of:
Less than $100,000:	10% of that bid or $9000
At least $100,000, but less than $200,000	9% of that bid, or $16,000
At least $200,000, but less than $300,000	8% of that bid, or $21,000
At least $300,000, but less than $400,000	7% of that bid, or $24,000
At least $400,000, but less than $500,000	6% of that bid, or $25,000
At least $500,000, but less than 1 million	5% of that bid, or $40,000
At least $1milion, but less than $2 million	4% of that bid, or $60,000
At least $2 million, but less than $4 million	3% of that bid, or $80,000
At least $4 million, but less than $7 million	2% of that bid, or $105,000
$7 million or more	1½% of the lowest responsive bid, with no dollar limit

Section 3 Applicability

It is the intent and policy of the Housing Authority of the City of Los Angeles (“HACLA”) to fully comply with Section 3 and to require its Contractors undertaking contracts to which Section 3 applies to demonstrate good faith effort to comply, to the greatest extent feasible, with Section 3 and the responsibilities described under the Section 3 Guide and Compliance Plan by providing economic opportunities to Section 3 Beneficiaries.

 

Contractors awarded a Section 3 Covered Contract and their Subcontractors prepare and submit an Economic Opportunity Plan (EOP). The plan outlines the contractor’s and its subcontractor’s commitments to generate economic opportunities in compliance with Section 3. The EOP is incorporated into the contract and contractors are monitored for compliance.

 

Job Commitments

Contractors who commit to hiring Section 3 Residents are required to submit HACLA their job specification and requirements as soon as possible. We strongly encourage contractors to use the Job Order form or provide HACLA their job bulletin listing qualifications, start date, work schedule, pay, and other relevant information. HACLA’s WorkSource Development team assists contractors and their subcontractors to conduct outreach and recruit qualified candidates for the open positions. At least 48 hours prior to hiring Section 3 Residents, the contractors/subcontractors are required to submit HACLA within 3 business days Form 3: Section 3 Resident Certification Form. The form should be emailed to section3@hacla.org.

 

Other Economic Opportunity Commitments

Contractors who commit to providing other economic opportunities, such as trainings, scholarships, internships, apprenticeships, etc. work with the Section 3 Compliance Administrator to create a proposal. Following the approval of the proposal and contract execution, the Section 3 team works with the contractors to execute the proposal.

 

Section 3 Compliance

Contractors and their subcontractors who perform Section 3 covered projects for the Housing Authority are monitored for compliance. Upon request, they are required to submit Form 5: Section 3 Compliance Summary Report, and other applicable forms in addition to documentation showing their Section 3 efforts. Section 3 Resident Certification Forms for all Section 3 new hires should be attached to the Section 3 Compliance Summary Report. Failure on part of the contractor or any of its subcontractors to meet the commitments set forth in contractor’s EOP may result in a determination that the contractor is in material default of the contract.

The forms referenced here are available in fillable PDF format at Forms, Documents and Policies page.

 

The list below illustrates economic opportunities offered by HACLA contractors who were unable to make hiring or subcontracting commitments. The list is not intended to be exclusive or exhaustive and is provided to contractors for the purpose of helping them develop their own economic opportunities for Section 3 Residents. 

 

Law firms, material only, information technology, professional service providers and out of state contractors have provided the following:

• Maintenance and labor related trainings
• Career Workshops
• Mentorship Programs
• Certification Programs
• Internships
• Scholarships
• College Preparation Help
• Section 3 Fund Contribution (as an option of last resort)

 

Jordan Downs Redevelopment Phase 1A is being developed by Bridge Housing Corporation who has selected Cannon Constructors as its General Contractor. Both the Developer and the General Contractor have Section 3 requirements. Cannon Constructors has hired PDA Consulting Group to help them fulfill their Section 3 obligations.

Section 3 Businesses interested in subcontracting opportunities during this phase are encouraged to connect with PDA Consulting Group.

Pamela V. Penn, President

110 La Brea Ave, Suite 420, Inglewood, CA 90301

Tel: 310-680-3740

Email: Pamela.Penn@pdaconsultinggroup.com

or Tatiana Campbell

Tel: 310-946-8525

Email: Tatiana.Campbell@pdaconsultinggroup.com