FAR 36.301—Use of two-phase design-build selection procedures.
Plain-English Summary
FAR 36.301 explains when a contracting officer should use the two-phase design-build selection procedure during acquisition planning and what factors must be evaluated before choosing it. The section covers the planning-stage decision to consider two-phase design-build, the threshold condition that three or more offers are anticipated, the requirement that offerors must do substantial design work before pricing, and the specific criteria that must be weighed in deciding whether the method is appropriate. Those criteria include how well the project requirements are defined, the project’s delivery schedule, the capability and experience of potential contractors, whether the project is suitable for two-phase selection, the agency’s ability to manage the process, and any additional criteria set by the head of the contracting activity. In practice, this section is meant to help agencies decide whether the two-phase approach will improve competition, reduce wasted proposal effort, and better match contractor qualifications to complex design-build needs. It also creates a disciplined record for why the method was selected, which is important for acquisition planning, source selection integrity, and later review of the procurement strategy.
Key Rules
Evaluate During Planning
If two-phase design-build is being considered, the contracting officer must perform the evaluation required by this section during formal or informal acquisition planning. The decision is not meant to be made casually or after the solicitation is already underway.
Use Only When Appropriate
The two-phase design-build selection procedure is used only when the contracting officer determines it is appropriate based on the required conditions and criteria. The rule gives discretion, but that discretion must be exercised by analyzing the listed factors.
Expect Three Offers
A key condition is that three or more offers are anticipated. This supports the idea that the two-phase process is worthwhile because it can screen qualifications before asking for full price or cost proposals.
Substantial Design Effort Required
The method is intended for situations where offerors must perform design work before developing price or cost proposals and will incur substantial proposal expense. This helps justify a process that reduces the burden of full pricing on firms that may not be competitive.
Assess Project Definition
The contracting officer must consider how well the project requirements have been defined. The less complete or less certain the requirements, the more important it is to assess whether two-phase selection will help identify the best design-build team.
Consider Schedule and Capability
The officer must evaluate time constraints for delivery, the capability and experience of potential contractors, and the agency’s ability to manage the process. These factors help determine whether the agency can run the procedure effectively and whether the market can support it.
Apply Additional Agency Criteria
The contracting officer must also consider any other criteria established by the head of the contracting activity. This allows agency-specific policy or risk considerations to be incorporated into the selection decision.
Responsibilities
Contracting Officer
During acquisition planning, evaluate whether two-phase design-build selection is appropriate by applying the conditions and criteria in this section. The contracting officer must determine whether three or more offers are anticipated, whether substantial design effort will be required before pricing, and whether the listed project and agency factors support use of the method.
Agency
Support acquisition planning by providing information on project definition, schedule needs, market capability, and internal management capacity. The agency must also ensure its planning process can support a sound decision on whether two-phase design-build is suitable.
Head of the Contracting Activity
Establish any additional criteria that must be considered when deciding whether to use the two-phase design-build selection procedure. These criteria become part of the contracting officer’s decision framework.
Potential Contractors
If the two-phase method is used, be prepared to submit qualifications or other phase-one information before price or cost proposals and to invest design effort where required. Contractors should understand that the process is intended to screen capability before full pricing.
Practical Implications
This section matters early, because the decision to use two-phase design-build should be made in acquisition planning, not after the solicitation strategy is fixed.
A common pitfall is using the method without a realistic expectation of at least three offers; if the market is too thin, the justification weakens.
Another risk is underestimating the amount of design effort and proposal expense required, which can make the process unfair or inefficient if the project does not truly warrant two phases.
Contracting officers should document how each required factor was considered, especially project definition, schedule pressure, contractor capability, agency management capacity, and any local HCA criteria.
For contractors, the practical effect is that early qualification matters: firms may need to invest in design and teaming decisions before they know final pricing competition details.
Official Regulatory Text
(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.