This rule revises HUD's regulations for Section 3 of the Housing and Urban Development Act of 1968, as amended by the Housing and Community Development Act of 1992 (Section 3), which ensures that employment, training, and contracting 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 that provide economic opportunities to these persons. HUD’s regulations implementing the requirements of Section 3 have not been updated since 1994 and are not as effective at promoting economic opportunity for low-income persons as HUD believes they could be.  This proposed rule would update HUD’s Section 3 regulations to streamline reporting requirements by aligning the reporting with standard business practice; amending the applicability section; updating reporting and adding new outcome benchmarks; and integrating Section 3 into program enforcement. The purpose of these changes is to reduce regulatory burden, increase compliance with Section 3 requirements, and increase Section 3 opportunities for low-income persons.