AGC Advances Legislative Priorities in Defense Bill

Design-Build and Reverse Auction Reforms Move Forward On Dec. 2, the House and Senate Armed Services released the final version of the National Defense Authorization Act for Fiscal Year 2015 (NDAA) bill, which includes AGC-supported provisions on design-build and reverse auction procurement reform impacting Department of Defense construction contractors.  The bill was considered by the House yesterday and is expected to be considered by the Senate later this week or early next week. Reports indicate that this bill will likely be enacted before Congress adjourns this year. Concerning design-build procurement, the bill would limit the shortlist in the two-phase design-build process to no more than 5 finalists on DOD agency contracts exceeding $4 million (see Section 814 of the bill). In the event a contract officer (CO) would like to include more than five finalists in the two-phase design-build process, that CO would: (1) have to provide written documentation of how exceeding five finalists is consistent with the purposes and objectives of the two-phase selection procedures; and (2) obtain the approval of the head of the agency contracting activity, i.e., the commanding general of the U.S. Army Corps of Engineers or commanding Rear Admiral of the Naval Facilities Engineering Command. On reverse auctions, the bill would explicitly prohibit reverse auction procurement for design-build construction services on military construction contracts (see Section 824 of the bill). In addition, the bill would place restrictions on single bidder reverse auctions through DOD procurements. Both of these provisions will be effective the day the president signs the NDAA bill into law. However, the reforms will require Defense Federal Acquisition Regulation Supplement (DFARS) changes. As a result, two DFARS cases will likely open to implement these provisions. In the event a DFARS reverse auction case is opened, AGC will push DOD to completely prohibit the procurement of construction services through reverse auctions. AGC has pressed for design-build reform and the prohibition of reverse auctions for construction services throughout this Congress and will continue to press for their final enactment. While these provisions are a positive step forward, AGC will continue to advocate for further reform in the new Congress in 2015 that address the entire federal government. For more information, please contact Jimmy Christianson at (703) 837-5325 or christiansonj@agc.org.