Section 3 Certification - City of St Paul

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Section 3 Certification - City of St Paul

  1. 1. Section 3 Certification -City of Saint Paul Luis Morales 651-266-8918 Luis.Morales@ci.stpaul.mn.us www.stpaul.gov/section3
  2. 2. WHAT IS SECTION 3?HUD Requirement: Recipients of certain HUDfinancial assistance must, to the greatest extent feasible, direct economic opportunities (jobs, contracts, training) to low-income residents in connection with projects and activities in their neighborhoods.
  3. 3. WHY SECTION 3?
  4. 4. SECTION 3 PROJECTS
  5. 5. SECTION 3 RESIDENTSA Section 3 resident must -reside in the metro area, and be -lower income Income Eligibility Guidelines - FY 2012Household 1 2 3 4 5 6 7 Size Income $45,500 $52,000 $58,500 $65,000 $70,200 $75,400 $80,600 Limit
  6. 6. SECTION 3 BUSINESS CONCERNS 51% or more owned by Section 3 Residents, OR 30% or more of employed staff are Section 3 Residents, or were w/in last three years, OR Over 25% of dollar amount of all subcontracts are committed to Section 3 Business
  7. 7. KEY DEFINITIONS Employed Staff – All permanent, full-time employees (includes office staff and trades people) Income – All sources of income for household (includes spouses) Household member – someone who lives with applicant and is related by marriage, birth, or adoption Metro Area – Counties of Anoka, Carver, Chisago, Dakota, Hennepin, Isanti, Ramsey, Scott, Sherburne, Washington, Wright, Pierce (WI), St. Croix (WI)
  8. 8. CERTIFICATION EXAMPLES Alice owns Brick Co. She has two kids under 18 and is the sole breadwinner. Her 2011 income was $47,000. Alice & her company are Section 3 eligible – 51% Ownership category. Mike and Jane are married and own ABC Plumbing (49-51 split). They have 1 child. Together, Mike and Jane made $75,000 in 2011. They are ineligible – 51% Ownership category. However, ABC Plumbing has six (6) FTEs (2 office workers, 4 trades people). In 2011, one office worker had a household income of $67,000 (2 adults, 3 kids). One tradesman is single and a first year apprentice with no other source of income. Two out of six (2/6) employees meet the income guidelines. ABC Plumbing is Section 3 eligible – 30% Employees.
  9. 9. CERTIFICATION EXAMPLES Alice owns Brick Co. She has two kids under 18 and is the sole breadwinner. Her 2011 income was $47,000. Alice & her company are Section 3 eligible – 51% Ownership category. Mike and Jane are married and own ABC Plumbing (49-51 split). They have 1 child. Together, Mike and Jane made $75,000 in 2011. They are ineligible – 51% Ownership category. However, ABC Plumbing has six (6) FTEs (2 office workers, 4 trades people). In 2011, one office worker had a household income of $67,000 (2 adults, 3 kids). One tradesman is single and a first year apprentice with no other source of income. Two out of six (2/6) employees meet the income guidelines. ABC Plumbing is Section 3 eligible – 30% Employees.
  10. 10. CERTIFICATION Ex. – 25% Subcont. $100,000 Project General Contractor must award over 25% General performs $50,000 and 25% Sec 3 of $50,000 = $12,500 awards remaining $50,000 to General Here, GC awarded $20,000 to a Sec 3 sub. three subcontractors Contractor For this project, the GC is also Sec 3. Sub # 2 Sub # 3 Sub # 1 Sec 3 $10,000 $20,000 $20,000
  11. 11. CERTIFICATION TIPS 30% Employees  Strategic hiring – many union workers on bench are Section 3 eligible. Hiring them can help your company reach 30% figure.  The income of 1st and 2nd year apprentices is lower than guidelines (check for employed spouse!).  Journeymen could qualify. Check hours worked/wk, wks/mo, mos/yr, household size (dependents).
  12. 12. CERTIFICATION TIPS – CONT’D 25% Subcontracting  Could your current subs become Section 3 certified (51% or 30%)? Are you open to working with Section 3 subs?  Request Section 3 business list – over 260 businesses certified
  13. 13. FIRST STEP? Get Certified with the City of Saint Paul Section 3 Program  Visit City’s Section 3 Website: www.stpaul.gov/section3  Application Forms  FAQs  Links to Opportunities

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