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Texas Department of Housing & Community Affairs - Building Homes and Strengthening Communities

Section 3 Reporting

Overview

The reporting requirement applies to any project receiving HOME, ESGP, or NSP funds from TDHCA, to lower-tier contracts, and to their subcontractors. Primary contract awardee must submit to TDHCA one report form 60002 that contains a combined summary of both their own Section 3 activities and those of contractors they hired (24 CFR 135.90 Reporting). TDHCA reports to HUD a summary of its contract awardees. TDHCA asks contract awardees to submit a completed report before the final draw. More complex projects may require additional reports.

Contracts entered into the HOME or NSP contract system after September 1, 2011 should find a version of the report in their draw request workbook.

All other subrecipients and contractors should use the TDHCA form on this web site: 60002 Report Form (XLS) and attach it in the contract system. For a graphic explanation of those who submit and those who receive Section 3 reports, download: Report Responsibility Chain Diagram (PDF).

General Concepts

Report Form-60002 contains project identification information plus three parts which contract awardees must complete for each of their programs covered by Section 3. Part I relates to employment and training (24 CFR 135.30 (b)). The contract awardee may opt to determine numerical employment and training goals either on the basis of:

  • If workforce includes only full-time workers, count number of new hires trained and employed on the Section 3 covered project (columns B, C, D, and F) or
  • When workforce includes part-time workers: count Section 3 residents’ hours as a proportion of all project staff hours worked (D) and (E).

Part II of the form quantifies business sub-contracting (24 CFR 135.30 (c)); This subcontracting should include all funding associated with the project – not just TDHCA/HUD funds.

Part III summarizes contract awardee’s efforts to comply with Section 3 (24 CFR 135.30 (d)). The awardee must explain obstacles that prevented achieving numerical goals for hiring and contracting, as described in 24 CFR 135.

Contract awardees should attach the completed report form to their TDHCA contract system account, after compiling and summarizing data from their contractors.

Submission Timing

Contract awardee submits completed Report form 60002 prior to final disbursement.

Detailed Instructions

For the heading of Section 3 Summary Report:

  1. Contract awardee Name and address of the project property. Include email address of primary contact person.
  2. Federal Identification Number): Contract awardees will substitute TDHCA contract number.
  3. Total Amount of Award: Enter the dollar amount, rounded to the nearest dollar, of HUD funds received from TDHCA.
  4. Contact person: The person at the contract awardee organization whom TDHCA staff may contact with questions about this report.
  5. Phone: The telephone number of the contact person.
  6. Length of Grant: Enter contract dates – beginning, ending, revised ending. If awardee previously submitted a report for the same contract, this beginning date will show the day after the reporting period for the previous report. If submitting only one report for a contract, this interval can reflect the revised contract dates.
  7. Reporting Period: Enter report period dates – beginning and ending.
  8. Date Report Submitted: Effective date of report data.
  9. Program Code: Select from list provided on the form.
  10. Program Name: Corresponds with item 9.

Part I: Employment and Training

  • Column A: Job categories: “Professionals” include those with educationally-based expertise other than construction trades (i.e.: architects, engineers, surveyors, planners, and computer programmers). For construction positions, select trade names that most closely resemble the ones involved on your job site.
  • Column B: Enter the number of all new hires for each job category identified in Column A. “New Hire” refers to a full-time worker not on the contract awardee’s payroll prior to contract award.
  • Column C: Enter number of full-time, self-certified “Section 3 new hires” for each category of workers identified in Column A. “Section 3 new hire” refers to a Section 3 resident (24 CFR 135.5 definition) not employed by the contractor prior to contract award.
  • Column D: This field will automatically calculate, dividing column C by B, and assumes full-time positions.
  • Column E: (optional) Percent of Total Staff Hours for Section 3 Employees and Trainees. This column allows comparison of full- and part-time employees, to add detail not reflected elsewhere. For each job category reporting new hires, enter Section 3 employees’ and trainees’ hours worked (full and part-time), under “S3E&TH” [E1]). Under “TSH” [E2] enter total staff hours worked in connection with this award, for each job category reporting new hires. Section 3 residents hired prior to contract award count toward “all staff hours” but not toward “new hires.” The column under “=%” [E3] will calculate automatically, by dividing “S3E&TH” by “TSH.”
  • Column F: Enter the number of Section 3 residents enrolled in HUD-approved apprenticeship or training program (HUD.gov) associated with each job category. Only if enrolled in a HUD-approved apprenticeship or training program (HUD.gov), may workers count as “trainees.”

Part II: Contracts

This section refers to contracts issued by the TDHCA contract awardee. Projects that include a match or other non-TDHCA/ non-HUD funds may show a total amount of contracts issued in excess of the “Total Amount of Award” entered on report heading of page 1.

Construction

  • Item A: Enter the total dollar amount of all construction contracts issued by the owner for this project.
  • Item B: Enter the total dollar amount of construction contracts on this project awarded to Section 3 businesses.
  • Item C: This field will automatically calculate, by dividing Item B by Item A.
  • Item D: Number of construction contracts with Section 3 businesses (those 51% or more owned by Section 3 residents or in which 30% of permanent, full-time employees qualify as Section 3 residents, or in which the business commits to subcontract more than 25% of work to Section 3 businesses (24 CFR 135.5)).

Non-construction Contracts

  • Item A: Enter the total dollar amount of all non-construction contracts issued by the owner for this project.
  • Item B: Enter the total dollar amount of non-construction contracts on this project awarded to Section 3 businesses.
  • Item C: This field will automatically calculate, by dividing Item B by Item A.
  • Item D: Number of non-construction contracts with Section 3 businesses (those 51% or more owned by Section 3 residents or in which 30% of permanent, full-time employees qualify as Section 3 residents, or in which the business commits to subcontract more than 25% of work to Section 3 businesses (24 CFR 135.5)).

Part III: Outreach – Demonstration of Good Faith Efforts

Indicate which Section 3 outreach activities the subrecipient and its contractors performed prior to new hiring or contracting for the project. (Visit Compliance Resources.)

Section 3 compliance – subject to monitoring, audit, and sanctions – depends on either meeting the numerical goals (24 CFR 135.30) or demonstrating why contract awardee or contractor could not feasibly meet them. In such cases, the contract awardee must describe obstacles to achieving program goals, as well as describing efforts intended to overcome them.

A contract awardee may enact and report other economic opportunities, such as those listed in 24 CFR 135.40, which they use to meet Section 3 obligations.

If you have any questions, please email hudsection3@tdhca.state.tx.us or contact TDHCA Program Services staff.