I'd fold. I am afraid of A2, A3,A5 hearts K3 hearts, Kx hearts, even trips. If he has Q,10 or J,10, you could get in trouble if you hit top pair.

You have $70 in there and almost $1500 to protect. It's hard to wait in three handed but this is not the time to fire.

It's been a while since I played much three handed except tournaments. I'd raise three handed but in general I follow Doyle's advice and am wary of hands with a queen in them. In ring games, I rarely raise with Q,J or K,Q before the flop. If there is no raise, you can have some confidence in your kicker if you flop top pair. If you raise with Q,J and get called and flop top pair, you don't know where you are.

At three handed, even bad players mix up their play and get harder to put on a hand. Since they were blinds, you don't know what type of hand they have from aces on down. That's not all that good a flop for you.

Most likely, if anything but a heart comes, someone will bet so much you won't see the river. An off card or the board pairing or a dry ace could bring a move in. The implied odds are about only one more card and another bigger decision.

Not all trappers wear fur hats. One of these fellows have a trap set and will have to step up and protect their hand if anything but a heart jumps off there.

I agree with Zmej (didn't read the other replies yet) that calling > raising >>> folding.

There's absolutely no way you can fold a flush draw and two overs here (and a backdoor straight draw!). You're getting good odds AND you have position AND you're closing the action. You only have to make $200 after you hit your flush to make it break even. I really don't see folding as an option here.

I do however see some things that could favor a raise. The main thing being that SB *has* to give your credit when you raise a full size bet that has been called by a calling station. I don't agree with Zmej that he will push a lot of his range here (although Zmej is by far more competent than me so that doesn't matter much). I would expect him to fold AT or worse here (and if he doesn't you're a small favorite over TPTK anyway). Of course it doesn't make sense to bluff a calling station like BB, who has already called a pot sized bet, but if there's ever a time he should fold it should be here...

Still, I think raising is a high-risk adventura that even though it might be +EV is definetely high variance, whereas calling is an obvious +EV decision with low variance.

I would raise to $999.