Defense Authorization Bill Signed into Law, Locking In Progressive Design-Build

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

The legislation authorizes protection coverage throughout the U.S. Dept. of Protection, together with acquisition reform and army building. Whereas last undertaking funding is dependent upon fiscal 2026 appropriations, the statute now provides protection building businesses express 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 Development 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 army building. Part 2809 permits the army 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 below federal legislation.

Progressive design-build permits homeowners to pick groups primarily based on skills and collaborate throughout early design earlier than negotiating last worth, relatively than locking in price on the proposal stage. State and native businesses have used the strategy on advanced initiatives however beforehand lacked a transparent statutory footing throughout the Protection Dept.

The importance is sensible: the legislation now helps earlier contractor and designer involvement on initiatives the place scope, website circumstances and sequencing dangers are tough 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 skill to contract building work over a number of years. Part 2814 authorizes multiyear contracting authority for sure army building initiatives, permitting businesses to construction supply past single-year execution home windows.

This authority is distinct from conventional annual MILCON contracting and is meant to enhance price 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 below the Navy’s Shipyard Infrastructure Optimization Program, acknowledging the technical complexity and threat profile of dry dock modernization and waterfront recapitalization work.

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

Different provisions develop eligible undertaking varieties and adaptability. 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 army installations—areas more likely to generate follow-on civil and environmental work.

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

Corporations with built-in design, price modeling, and constructability experience are possible higher positioned, as homeowners achieve the pliability to defer last worth 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 Services Engineering Methods Command and Air Power Civil Engineer Middle, that are anticipated to subject 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—equivalent to shipyard recapitalization, depot modernization and Indo-Pacific posture upgrades—however timing will depend upon company steerage and FY 2026 appropriations.

As with prior protection authorization payments, the legislation authorizes coverage relatively than appropriates funding. Nonetheless, by embedding supply reform immediately into statute, the FY 2026 NDAA establishes a sturdy framework that might materially change how army building is deliberate, contracted and delivered over the subsequent decade—effectively past a single funds cycle.