The FY2026 National Defense Authorization Act for the first time expressly authorizes the use of progressive design-build procedures for military construction projects, resolving years of legal ambiguity about whether the collaborative, qualifications-based delivery model was permissible under federal law for MILCON. The provision, championed by the Design-Build Institute of America and supported by the major military construction agencies, gives contracting officers statutory backing to use progressive design-build on complex projects where locking in price at the proposal stage has historically driven cost growth and scope disputes that inflate final project cost well above the original award value.
What Progressive Design-Build Is and Why It Matters for MILCON
Progressive design-build is a project delivery model in which the owner selects a design-build team based primarily on qualifications and early design concepts rather than on a final price proposal. Once selected, the team collaborates with the owner through the design development process, and a final contract price is negotiated after the design reaches sufficient maturity to support reliable cost estimation. The approach differs from conventional design-build, in which the contractor submits a fixed price as part of the proposal and assumes the risk that incomplete design information at proposal time will result in underpricing that leads to disputes or performance problems.
For military construction, the progressive approach addresses a persistent problem in MILCON acquisition: the design documents available at solicitation are often insufficiently complete to support accurate pricing, particularly for complex facility types such as shipyard industrial buildings, overseas posture projects, or facilities with classified requirements that limit the information that can be shared in the solicitation package. When contractors price these projects based on incomplete information, one of two outcomes typically results — either they price conservatively and the government pays a substantial risk premium embedded in the bid, or they price aggressively to win the award and then seek scope relief during construction through requests for equitable adjustment that drive cost growth well above the original contract value.
The Previous Legal Uncertainty
Before the FY2026 NDAA, progressive design-build occupied an ambiguous legal position in the MILCON context. The FAR permits design-build acquisition through a two-phase selection process that evaluates qualifications first and price proposals from a short-listed subset of firms second — but that process still requires a price commitment at the proposal stage rather than deferring price negotiation until after design development. Contracting officers who wanted to use progressive design-build methods had to work around this framework, and the lack of explicit statutory authorization created legal exposure for both the government and the firms that participated in progressive design-build selections.
The Design-Build Institute of America described the new provision as removing years of uncertainty that had limited adoption of the delivery model even on projects where it would have been the most appropriate approach. Contracting officers can now select this method for qualifying MILCON projects without the legal risk that attended its use previously, and contractors can invest in progressive design-build proposal preparation with confidence that the selection method has clear and durable statutory authority that cannot be challenged on the grounds that it departs from the FAR's design-build framework.
How the Authorized Process Works
Under the new framework, military departments may use qualifications-based, single-phase selection procedures that emphasize the team's experience, past performance on similar project types, design approach, and proposed project management structure. Price is not part of the initial selection criteria. Once a team is selected, it enters a preconstruction services phase in which the designer-of-record, the general contractor, and key specialty trade partners collaborate with the government owner to develop the design to a level of completeness that supports reliable cost modeling.
The final construction price is then negotiated based on actual design documents rather than conceptual estimates. This structure places greater weight on qualifications and early collaboration than on the ability to produce competitive pricing from incomplete information. DBIA and project advocates argue this approach produces better outcomes on projects where scope definition is genuinely difficult to complete before construction team input is available. If the government and selected team cannot reach agreement on price, the government retains the ability to terminate the preconstruction services agreement and re-compete using a different delivery method.
Project Types and Strategic Implications
The NDAA provision is expected to have the greatest impact on projects where scope complexity and site risk make early price commitments unreliable. Shipyard industrial facilities — which involve integration of heavy equipment, overhead crane systems, and specialized mechanical and electrical infrastructure within constrained waterfront sites — are frequently cited as a project type that benefits from the progressive model. Overseas military construction, particularly in the Indo-Pacific theater where DoD has dramatically expanded its posture investment, involves site conditions, labor markets, and regulatory environments that are difficult to fully account for in a proposal-stage price estimate. Facilities requiring specialized environmental controls, seismic resistance design, or integration with classified operational systems present similar challenges where early contractor and designer involvement reduces the risk of cost growth during construction.
For construction firms with strong qualifications-based track records on complex government projects, the progressive design-build expansion creates competitive opportunities that the prior legal framework foreclosed. Firms that have invested in integrated delivery capabilities — combining design, cost modeling, constructability review, and self-perform construction in a single team — are well positioned under selection criteria that reward those capabilities rather than the ability to produce the lowest number on incomplete documents. The provision effectively shifts the competitive dynamic toward firms whose value proposition is management capability and design expertise, which is a structural advantage for companies that have built integrated delivery practices over years of commercial and institutional project experience and are now positioned to bring those same capabilities into the defense construction market at a time when DoD's military construction budget is at historically high levels and the complexity of new facility requirements continues to increase.
