[Federal Register Volume 62, Number 1 (Thursday, January 2, 1997)]
[Rules and Regulations]
[Pages 271-273]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-33217]


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DEPARTMENT OF DEFENSE
48 CFR Parts 1, 5, 14, and 36

[FAC 90-45; FAR Case 96-305; Item XIII]
RIN 9000--AH17


Federal Acquisition Regulation; Two-Phase Design Build Selection 
Procedures

AGENCIES: Department of Defense (DOD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Final rule.

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SUMMARY: The Civilian Agency Acquisition Council and the Defense 
Acquisition Regulations Council have agreed on a final rule to amend 
the Federal Acquisition Regulation (FAR) to implement Section 4105 of 
the Clinger-Cohen Act of 1996 (Public Law 104-106), which authorizes 
the use of two-phase design-build procedures for construction 
contracting. This regulatory action was not subject to Office of 
Management and Budget review under Executive Order 12866, dated 
September 30, 1993, and is not a major rule under 5 U.S.C. 804.

EFFECTIVE DATE: January 1, 1997.

FOR FURTHER INFORMATION CONTACT: Mr. Jack O'Neill at (202) 501-3856 in 
reference to this FAR case. For general information, contact the FAR 
Secretariat, Room 4035, GS Building, Washington, DC 20405 (202) 501-
4755. Please cite FAC 90-5, FAR case 96-305.

SUPPLEMENTARY INFORMATION:

A. Background

    A proposed rule with request for public comment was published in 
the Federal Register at 61 FR 41212, August 7, 1996. Comments were 
received from 77 respondents. After analysis of the public comments and 
further consideration of the proposed language, the rule was revised at 
FAR 36.104, 36.301(b)(2), and 36.303-1 to more closely conform to the 
provisions of Section 4105 of Public Law 104-106. In addition, examples 
of phase-two evaluation factors have been added at FAR 36.303-(a).

B. Regulatory Flexibility Act

    This final rule may have a significant economic impact on a 
substantial number of small entities within the meaning of the 
Regulatory Flexibility Act, 5 U.S.C. 601 et seq., because the rule 
reduces the cost of proposal preparation for those offerors not 
selected for Phase Two, when two-phase design-build procedures are 
used. A Final Regulatory Flexibility Analysis (FRFA) has been prepared 
and is summarized as follows:

    We estimate that approximately 1,465 small businesses responding 
to two-phase design-build solicitations annually may save proposal 
costs on an average of eight separate solicitations each. This final 
rule imposes no new reporting or recordkeeping requirements.

    A copy of the FRFA will be provided to the Chief Counsel for 
Advocacy for the Small Business Administration. A copy of the FRFA may 
be obtained from the FAR Secretariat. Comments are invited. Comments 
from small entities concerning the affected FAR subpart will be 
considered in accordance with 5 U.S.C. 610. Such comments must be 
submitted separately and cite 5 U.S.C 601, et seq. (FAR Case 96-305), 
in correspondence.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because the changes to 
the FAR do not impose recordkeeping or information collection 
requirements, or collections of information from offerors, contractors, 
or members of the public which require the approval of the Office of 
Management and Budget under 44 U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 1, 5, 14, and 36

     Government procurement.

    Dated: December 24, 1996.
Edward C. Loeb,
Director, Federal Acquisition Policy Division.

    Therefore, 48 CFR Parts 1, 5, 14, and 36 is amended as set forth 
below:
    1. The authority citation for 48 CFR Parts 1, 5, 14, and 36 
continues to read as follows:

    Authority: 40 U.S.C. 486(c); 10 U.S.C. chapter 137; and 42 
U.S.C. 2473(c).

PART 1--FEDERAL ACQUISITION REGULATION SYSTEM


1.106  [Amended]

    2. Section 1.106 is amended in the list following the introductory 
paragraph by removing the FAR segment ``36.302'' and inserting 
``36.213-2''.

PART 5--PUBLICIZING CONTRACT ACTIONS

    3. Section 5.204 is amended by revising the first sentence to read 
as follows:


5.204  Presolicitation notices.

    Contracting officers shall publicize presolicitation notices in the 
CBD (see 15.404 and 36.213-2). * * *

[[Page 272]]

PART 14--SEALED BIDDING

    4. Section 14.202-1 is amended in paragraph (a) by revising the 
first parenthetical to read as follows:


14.202-1  Bidding time.

    (a) * * * (For construction contracts, see 36.213-3(a)). * * *
* * * * *
    5. Section 14.211 is amended by revising the first sentence of 
paragraph (a) to read as follows:


14.211  Release of acquisition information.

    (a) Before solicitation. Information concerning proposed 
acquisitions shall not be released outside the Government before 
solicitation except for presolicitation notices in accordance with 
14.205-4(c) or 36.213-2, or long-range acquisition estimates in 
accordance with 5.404, or synopses in accordance with 5.201. * * *
* * * * *

PART 36--CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS

    6. Section 36.102 is amended by adding, in alphabetical order, the 
definitions ``Design'', ``Design-bid-build'', ``Design-build'', and 
``Two-phase design-build selection procedures'' to read as follows:


36.102  Definitions.

* * * * *
    Design, as used in this part, means defining the construction 
requirement (including the functional relationships and technical 
systems to be used, such as architectural, environmental, structural, 
electrical, mechanical, and fire protection), producing the technical 
specifications and drawings, and preparing the construction cost 
estimate.
    Design-bid-build, as used in this part, means the traditional 
delivery method where design and construction are sequential and 
contracted for separately with two contracts and two contractors.
    Design-build, as used in this part, means combining design and 
construction in a single contract with one contractor.
* * * * *
    Two-phase design-build selection procedures, as used in this part, 
is a selection method in which a limited number of offerors (normally 
five or fewer) is selected during Phase One to submit detailed 
proposals for Phase Two (see subpart 36.3).
    7. Section 36.104 is added to read as follows:


36.104  Policy.

    Unless the traditional acquisition approach of design-bid-build 
established under the Brooks Architect-Engineers Act (41 U.S.C. 541, et 
seq.) or another acquisition procedure authorized by law is used, the 
contracting officer shall use the two-phase selection procedures 
authorized by 10 U.S.C. 2305a or 41 U.S.C. 253m when entering into a 
contract for the design and construction of a public building, 
facility, or work, if the contracting officer makes a determination 
that the procedures are appropriate for use (see subpart 36.3). Other 
acquisition procedures authorized by law include the procedures 
established in this part and other parts of this chapter and, for DoD, 
the design-build process described in 10 U.S.C. 2862.

Subpart 36.3 [Redesignated as 36.213 and Amended]


36.301-36.304  [Redesignated as 36.213-1--36.213-4]

    8. Subpart 36.3 is redesignated as section 36.213 and the heading 
is revised to read ``Special procedures for sealed bidding in 
construction contracting.''; and sections 36.301 through 36.304 are 
redesignated as 36.213-1 through 36.213-4, respectively.

Subpart 36.4 [Removed]


36.401  [Removed]


36.402  [Redesignated as 36.214]


36.403  [Redesignated as 36.215]

    9. Subpart heading 36.4 and section 36.401 are removed; and 
sections 36.402 and 36.403 are redesignated as 36.214 and 36.215, 
respectively, and the section headings revised to read as follows:


36.214  Special procedures for price negotiation in construction 
contracting.


36.215  Special procedure for cost-reimbursement contracts for 
construction.

    10. Subpart 36.3, consisting of sections 36.300 through 36.303-2, 
is added to read as follows:

Subpart 36.3--Two-Phase Design-Build Selection Procedures

Sec.
36.300  Scope of subpart.
36.301  Use of two-phase design-build selection procedures.
36.302  Scope of work.
36.303  Procedures.
36.303-1  Phase One.
36.303-2  Phase Two.

Subpart 36.3--Two-Phase Design-Build Selection Procedures


36.300  Scope of subpart.

    This subpart prescribes policies and procedures for the use of the 
two-phase design-build selection procedures authorized by 10 U.S.C. 
2305a and 41 U.S.C. 253m.


36.301  Use of two-phase design-build selection procedures.

    (a) During formal or informal acquisition planning (see part 7), if 
considering the use of two-phase design-build selection procedures, the 
contracting officer shall conduct the evaluation in paragraph (b) of 
this section.
    (b) The two-phase design-build selection procedures shall be used 
when the contracting officer determines that this method is 
appropriate, based on the following:
    (1) Three or more offers are anticipated.
    (2) Design work must be performed by offerors before developing 
price or cost proposals, and offerors will incur a substantial amount 
of expense in preparing offers.
    (3) The following criteria have been considered:
    (i) The extent to which the project requirements have been 
adequately defined.
    (ii) The time constraints for delivery of the project.
    (iii) The capability and experience of potential contractors.
    (iv) The suitability of the project for use of the two-phase 
selection method.
    (v) The capability of the agency to manage the two-phase selection 
process.
    (vi) Other criteria established by the head of the contracting 
activity.


36.302  Scope of work.

    The agency shall develop, either in-house or by contract, a scope 
of work that defines the project and states the Government's 
requirements. The scope of work may include criteria and preliminary 
design, budget parameters, and schedule or delivery requirements. If 
the agency contracts for development of the scope of work, the 
procedures in subpart 36.6 shall be used.


36.303  Procedures.

    One solicitation may be issued covering both phases, or two 
solicitations may be issued in sequence. Proposals will be evaluated in 
Phase One to determine which offerors will submit proposals for Phase 
Two. One contract will be awarded using competitive negotiation.

[[Page 273]]

36.303-1  Phase One.

    (a) Phase One of the solicitation(s) shall includ--
    (1) The scope of work;
    (2) The phase-one evaluation factors, including--
    (i) Technical approach (but not detailed design or technical 
information);
    (ii) Technical qualifications, such as--
    (A) Specialized experience and technical competence;
    (B) Capability to perform;
    (C) Past performance of the offeror's team (including the 
architect-engineer and construction members); and
    (iii) Other appropriate factors (excluding cost or price related 
factors, which are not permitted in Phase One);
    (3) Phase-two evaluation factors (see 36.303-2); and
    (4) A statement of the maximum number of offerors that will be 
selected to submit phase-two proposals. The maximum number specified 
shall not exceed five unless the contracting officer determines, for 
that particular solicitation, that a number greater than five is in the 
Government's interest and is consistent with the purposes and 
objectives of two-phase design-build contracting).
    (b) After evaluating phase-one proposals, the contracting officer 
shall select the most highly qualified offerors (not to exceed the 
maximum number specified in the solicitation in accordance with 36.303-
1(a)(4)) and request that only those offerors submit phase-two 
proposals.


36.303-2  Phase Two.

    (a) Phase Two of the solicitation(s) shall be prepared in 
accordance with part 15, and include phase-two evaluation factors, 
developed in accordance with 15.605. Examples of potential phase-two 
technical evaluation factors include design concepts, management 
approach, key personnel, and proposed technical solutions.
    (b) Phase Two of the solicitation(s) shall require submission of 
technical and price proposals, which shall be evaluated separately, in 
accordance with part 15.
    11. Subpart 36.4 is added and reserved to read as follows:

Subpart 36.4--Commercial Practices [Reserved]

[FR Doc. 96-33217 Filed 12-31-96; 8:45 am]
BILLING CODE 6820--EP