FY 2026 NDAA Codified, Locking In Progressive Design-Build and Multiyear Authority

President Donald Trump on Dec. 18 signed the National Defense Authorization Act for Fiscal Year 2026, enacting almost $900 billion in protection coverage and formally embedding supply and contracting reforms that might reshape how navy building is procured and executed.

The regulation authorizes protection coverage throughout the Dept. of Protection, together with acquisition reform and navy building. Whereas last undertaking funding depends upon FY 2026 appropriations, the statute now provides protection building companies specific authority to make use of supply instruments that had beforehand been utilized erratically or cautiously.

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For engineering and building companies, probably the most consequential provisions are concentrated in Division B—Army Building Authorizations, significantly Title XXVIII, which governs how initiatives could also be deliberate, contracted and delivered.

For the primary time, Congress has expressly approved progressive design-build for navy building. Part 2809 permits the navy departments to make use of “accelerated design-build and progressive design-build procedures” for MILCON initiatives, eradicating long-standing uncertainty about whether or not collaborative, qualifications-based supply fashions are permissible underneath federal regulation.

Progressive design-build permits house owners to pick out groups based mostly on skills and collaborate throughout early design earlier than negotiating last value, fairly than locking in value on the proposal stage. State and native companies have used the strategy on advanced initiatives however beforehand lacked a transparent statutory footing inside the Protection Dept.

The importance is sensible: the regulation now helps earlier contractor and designer involvement on initiatives the place scope, website circumstances and sequencing dangers are troublesome to outline upfront, together with shipyard work, industrial services and abroad posture initiatives.

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Multi-year Contracting Authority Extends Past Upkeep

The NDAA additionally expands DOD’s potential to contract building work over a number of years. Part 2814 authorizes multiyear contracting authority for sure navy building initiatives, permitting companies to construction supply past single-year execution home windows.

This authority is distinct from conventional annual MILCON contracting and is meant to enhance value management, workforce continuity and scheduling certainty on giant or phased applications. For contractors, it opens the door to longer planning horizons and probably fewer stop-start procurements on main installations.

In parallel, Part 2816 authorizes cost-plus-incentive-fee contracts for chosen initiatives underneath the Navy’s Shipyard Infrastructure Optimization Program, acknowledging the technical complexity and danger profile of dry dock modernization and waterfront recapitalization work.

Past supply, the regulation reinforces long-term demand alerts. Part 2803 requires the navy departments to develop and replace 20-year infrastructure enchancment plans, formalizing a multidecade planning framework for bases, depots and industrial services.

Different provisions increase eligible undertaking sorts and suppleness. Part 2807 explicitly consists of demolition initiatives within the Protection Group Infrastructure Program, whereas Part 2804 strengthens necessities associated to water administration and safety on navy installations—areas more likely to generate follow-on civil and environmental work.

Collectively, the enacted authorities level towards procurement shifts that ENR readers will wish to watch intently. Businesses now have statutory backing to position larger emphasis on qualifications-based choice, early preconstruction companies and phased value improvement, significantly on advanced or high-risk initiatives.

Corporations with built-in design, value modeling, and constructability experience are doubtless higher positioned, as house owners achieve the flexibleness to defer last value commitments till design maturity improves. Multiyear authority additionally favors groups able to sustaining workforce and supply-chain capability throughout longer supply timelines.

Implementation will fall primarily to the U.S. Military Corps of Engineers, Naval Amenities Engineering Techniques Command and Air Power Civil Engineer Middle, that are anticipated to difficulty inside acquisition steerage decoding the brand new authorities earlier than making use of them to imminent procurements.

Early adoption is predicted on technically advanced initiatives—akin to shipyard recapitalization, depot modernization and Indo-Pacific posture upgrades—however timing will depend upon company steerage and FY 2026 appropriations.

As with prior NDAAs, the regulation authorizes coverage fairly than appropriates funding. Nonetheless, by embedding supply reform immediately into statute, the FY 2026 NDAA establishes a sturdy framework that might materially change how navy building is deliberate, contracted and delivered over the subsequent decade—properly past a single price range cycle.