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114th Congress   }                                      {       Report
                        HOUSE OF REPRESENTATIVES
 2d Session      }                                      {      114-691

======================================================================



 
       CONSTRUCTION CONSENSUS PROCUREMENT IMPROVEMENT ACT OF 2016

                                _______
                                

 July 14, 2016.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______
                                

 Mr. Chaffetz, from the Committee on Oversight and Government Reform, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 5199]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Oversight and Government Reform, to whom 
was referred the bill (H.R. 5199) to amend title 41, United 
States Code, to improve the manner in which Federal contracts 
for construction and design services are awarded, and to 
prohibit the use of reverse auctions for design and 
construction services procurements, having considered the same, 
report favorably thereon with an amendment and recommend that 
the bill as amended do pass.

                                CONTENTS

                                                                   Page
Committee Statement and Views....................................     2
Section-by-Section...............................................     4
Explanation of Amendments........................................     6
Committee Consideration..........................................     6
Roll Call Votes..................................................     6
Application of Law to the Legislative Branch.....................     6
Statement of Oversight Findings and Recommendations of the 
  Committee......................................................     6
Statement of General Performance Goals and Objectives............     6
Duplication of Federal Programs..................................     7
Disclosure of Directed Rule Makings..............................     7
Federal Advisory Committee Act...................................     7
Unfunded Mandate Statement.......................................     7
Earmark Identification...........................................     7
Committee Estimate...............................................     7
Budget Authority and Congressional Budget Office Cost Estimate...     7
Changes in Existing Law Made by the Bill, as Reported............     9

    The amendment is as follows:

  In section 3, in the matter proposed to be inserted by subsection 
(a)(1), strike ``$750,000'' each place it appears (including any 
headings) and insert ``$3,000,000''.

                     Committee Statement and Views


                          PURPOSE AND SUMMARY

    H.R. 5199, the Construction Consensus Procurement 
Improvement Act of 2016, was introduced to encourage 
competition and reduce the costs of bidding for federal 
construction contracts. The bill encourages the use of the two-
step bid and proposal process for design-build construction 
contracts in order to reduce the costs of competing in the 
government marketplace, and reduce the time contracting 
officers must spend reviewing numerous complicated design 
proposals in the one-step process.

                  BACKGROUND AND NEED FOR LEGISLATION

    The federal government spent $439 billion in fiscal year 
(FY) 2015 on contracts for goods and services. Approximately 
$21.4 billion (or five percent) of this amount was spent on 
federal construction and architect and engineering (A&E;) 
projects. Small business prime contractors received 
approximately $7.4 billion (or 35 percent) of this spending.\1\ 
Construction contracting would benefit from a streamlining of 
the procurement process to ensure robust small business 
participation on design-build proposal teams.
---------------------------------------------------------------------------
    \1\Data source is the Federal Procurement Data Systems-Next 
Generation (FPDS-NG) available at: http://www.fpds.gov.
---------------------------------------------------------------------------
    Typically, the federal government uses one of two processes 
for buying construction and A&E; services. First, under the 
``design-bid-build'' process, design and construction are 
treated as two separate requirements and contracts are awarded 
sequentially and separately. Under the second ``design-build'' 
process design and construction are combined into a single 
requirement with a single contract awarded to one company 
(which is often a team) responsible for both the design and 
construction.\2\
---------------------------------------------------------------------------
    \2\41 U.S.C. Sec. 3309.
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    There are two source selection processes for design-build 
contracts.\3\ There is the single-step design-build selection 
process where all construction and design teams must submit 
detailed and costly full proposals up front. The procuring 
agency then evaluates all proposals and selects an awardee. 
There is also a two-phase design-build selection process.\4\ 
Under this process, teams submit information related to 
experience and past performance in phase one. The procuring 
agency then selects a limited number of the most qualified 
offerors (generally three to five) to advance to phase two of 
the competition. During phase two, these offerors submit 
detailed price and technical proposals that the procuring 
agency evaluates in order to make an award decision.
---------------------------------------------------------------------------
    \3\The federal government has used this design-build method since 
the late 1980s and early 1990s. Ralph C. Nash & John Cibinic, Design-
Build Contracting: Can the Federal Government Use This Technique 
Effectively? No. 12 Nash & Cibinic Rep. 68 (1994).
    \4\48 C.F.R. Sec. 36.303.
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Encouraging the use of the two-step design-build process

    There are recognized benefits to design-build contracting 
that include having a single accountable prime contractor. 
However, this process also requires highly complicated and 
often costly proposals. Experts have said that in order to 
develop accurate construction cost proposals, bidders must 
complete up to 80 percent of the design work and determine 
detailed space and material needs.\5\ Current law encourages 
the use of a two-step process for design-build contracts and 
the selection of no more than two to five firms for phase two 
in order to encourage selection of the most qualified firms and 
limit the cost burden of these types of proposals.\6\
---------------------------------------------------------------------------
    \5\Assessing Government's Use of Design-Build Contracts: Hearing 
before the Subcomm. on Federal Workforce, US Postal Service and the 
Census of the H. Comm. on Oversight and Gov't Reform, 113th Cong. 
(2013) (statement of Charles D. Dalluge on behalf of the American 
Institute of Architects).
    \6\41 U.S.C. Sec. 3309(d).
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    However, concerns have been expressed that agencies 
awarding construction contracts (typically the General Services 
Administration (GSA) and the U.S. Army Corps of Engineers 
(USACE)) are overly reliant on one-step design-build 
contractors. In addition, when the two-step process is used 
there are concerns that these agencies may be allowing too many 
offerors into phase two.\7\
---------------------------------------------------------------------------
    \7\Assessing Government's Use of Design-Build Contracts: Hearing 
before the Subcomm. on Federal Workforce, US Postal Service and the 
Census of the H. Comm. on Oversight and Gov't Reform, 113th Cong. 
(2013) (statement of Charles D. Dalluge on behalf of the American 
Institute of Architects); The Hill, A Better Way to Build More 
Efficient Government by Helen Combs Dreiling (Oct. 4, 2014).
---------------------------------------------------------------------------
    While the one-step process can offer the advantage of speed 
to the government, it can also be more expensive, burdensome 
and time-consuming for potential contractors, who must make a 
significant investment in proposal costs with limited chances 
of being awarded the contract. This can discourage firms from 
competing.
    A 2012 survey by the American Institute of Architects found 
that between 2007 and 2011, architecture firms spent a median 
of $260,000 for each design-build project, which is a 
significant investment, particularly for small businesses.\8\ 
Under the two-step process, there is a lower initial cost 
because bidders' proposals are focused on demonstrating 
experience and past performance qualifications. Then, as the 
number of potential bidders decreases in phase two, bidders 
have a greater chance of winning the award and therefore a 
greater return on investment from their cost proposals. The 
advantages of the two-step process are limited though when over 
five bidders advance to phase two.
---------------------------------------------------------------------------
    \8\Assessing Government's Use of Design-Build Contracts: Hearing 
before the Subcomm. on Federal Workforce, US Postal Service and the 
Census of the H. Comm. on Oversight and Gov't Reform, 113th Cong. 
(2013) (statement of Charles D. Dalluge on behalf of the American 
Institute of Architects).
---------------------------------------------------------------------------
    This bill will encourage the use of the two-step process 
for construction procurements. The two-step design-build 
process can help to ensure that the most qualified bidders are 
selected for phase two and that those firms have a greater 
incentive to submit a competitive proposal because they will 
have a greater chance of winning the award. Encouraging the use 
of the two-step process for design and construction services 
will reduce the costs of competing in the government 
marketplace and reduce the time contracting officers must spend 
reviewing numerous complicated design proposals.

Prohibiting the use of reverse auctions for design and construction 
        services

    The term ``reverse auction'' is not defined in statute. 
However, the Office of Management and Budget (OMB) has released 
guidance on how to effectively use the reverse auctions.\9\ 
Reverse auctions provide a method for bidding down prices and 
is a particularly useful tool for the purchase of commodities. 
However, the reverse auction tool may not be appropriate for 
the procurement of complicated design and construction 
services.
---------------------------------------------------------------------------
    \9\OMB Memorandum on Effective Use of Reverse Auctions from Office 
of Federal Procurement Administrator Anne E. Rung Memorandum for Chief 
Acquisition Officers and Senior Procurement Executives (June 1, 2015).
---------------------------------------------------------------------------
    The USACE conducted a year-long study of reverse auctions 
for construction services and found that it did not deliver the 
promised savings in construction contracts. Specifically, the 
USACE found that using reverse auctions for construction 
projects did not provide ``any significant or even marginal 
edge in savings'' and that construction was too variable a 
service to be considered a commodity.\10\
---------------------------------------------------------------------------
    \10\USACE, Final Report Regarding the USACE Pilot Program on 
Reverse Auctioning 11 (2004).
---------------------------------------------------------------------------
    This bill prohibits the use of reverse auctions as part of 
the two-phase process for construction and design services.

                          LEGISLATIVE HISTORY

    H.R. 5199, the Construction Consensus Procurement 
Improvement Act of 2016, was introduced on May 11, 2016 by 
Congressman Mark Meadows (R-NC) and referred to the Committee 
on Oversight and Government Reform.
    A companion bill, S. 1526, the Construction Consensus 
Procurement Improvement Act of 2015, was introduced by Senator 
Portman on June 8, 2015. On February 10, 2016, the Senate 
Homeland Security and Governmental Affairs Committee ordered 
the bill, as amended, favorably reported.
    Two other related House bills were introduced in 2015, 
including H.R. 1666, the Design-Build Efficiency and Jobs Act 
of 2015, and H.R. 838, the Security in Bonding Act of 2015.
    On December 12, 2014, in the 113th Congress, the House 
Oversight and Government Reform Committee reported H.R. 2750, 
the Design-Build Efficiency and Jobs Act of 2014.\11\ H.R. 2750 
would have required a two-phase selection process for the award 
of civilian and defense design and construction contracts 
having a value of greater than $1.5 million, but did not 
include language on reverse auctions.
---------------------------------------------------------------------------
    \11\House Report 113-668 (Dec. 12, 2014).
---------------------------------------------------------------------------

                           Section-by-Section


Section 1. Short title; table of contents

    Designates the bill as the ``Construction Consensus 
Procurement Improvement Act of 2016.''

Section 2. Congressional findings

    Makes six findings: (1) acquisition procedures that are 
often used effectively to procure productions and other forms 
of services are not always appropriate for procurement of 
design and construction services; (2) federal procurement 
officials often adopt contracting techniques from the private 
sector and have used those techniques effectively to procure 
products and services; (3) design-build is a procurement 
technique federal officials have adopted from the private 
sector that has worked well for procurement of design and 
construction services; (4) the current statutory framework for 
design-build could benefit from legislative refinement; (5) 
reverse auctions are another procurement technique federal 
officials have adopted from the private sector and used 
successfully to award contracts for the purchase of products 
that are commercially equivalent to commodities; and (6) 
despite their success in other contexts, reverse auctions are 
generally inappropriate for procurement of design and 
construction services, given the unique nature of each such 
project.

Section 3. Design-build construction process improvement

    For civilian contracts for design and construction of a 
public building, facility or work, the bill would require two-
phase selection procedures be used for contracts with a value 
of $750,000 or greater.
    For such contracts valued at less than $750,000, the bill 
would require the contracting officer to make a determination 
on whether to use two-phase selection procedures based on 
consideration of several factors. The contracting officer would 
be required to consider the following factors: (1) whether the 
contracting officer anticipates three or more offers will be 
received; (2) design work must be performed before an offeror 
can develop a price or cost proposal; (3) whether the offeror 
will incur a substantial amount of expense in preparing the 
offer; and (4) other information including the: (i) extent to 
which the project requirements have been adequately defined; 
(ii) time constraints for delivery of the project; (iii) 
capability and experience of potential customers; (iv) 
suitability of the project for use of the two-phase selection 
procedures; (v) capability of the agency to manage the two-
phase selection process; and (vi) other agency-established 
criteria.
    Requires annual agency reports on each instance by which 
the agency awarded a design-build contract in which more than 
five finalists were selected for phase-two requests for 
proposals or the contract was awarded without using two-phase 
selection procedures. OMB would be required to make the agency 
reports publicly available.
    Requires the Government Accountability Office to analyze 
agency compliance with the requirements of this bill on design-
build contracts.

Section 4. Prohibition on the use of a reverse auction for the award of 
        a contract for design and construction services

    States a finding that reverse auctions bid down the price 
compared to traditional auctions where buyers bid up on the 
price.
    Requires the Federal Acquisition Regulatory Council in 
consultation with the Administrator for Federal Procurement 
Policy to amend the Federal Acquisition Regulation to prohibit 
the use of reverse auctions as part of the two-phase selection 
procedure for awarding contracts for construction and design 
services.
    Defines ``design and construction services'' as site 
planning and landscape design, architectural and engineering 
services (including surveying and mapping), interior design, 
performance of substantial construction work for facility, 
infrastructure, and environmental restoration projects, 
delivery and supply of construction materials to construction 
sites, or construction or substantial alteration of public 
buildings or public works.
    Defines ``reverse auction'' as a real-time auction 
conducted through an electronic medium among two or more 
offerors who compete by submitting bids for a supply or service 
contract with the ability to submit revised lower bids at any 
time before the closing of the auction; and the award of the 
contract, delivery order, task order, or purchase order to the 
offeror in whole or in part, based on the price obtained 
through the auction process.

                       Explanation of Amendments

    During Full Committee consideration of the bill, Ranking 
Member Elijah Cummings (D-MD) offered an amendment on behalf of 
Congressman Stephen Lynch (D-MA) that would raise the contract 
value threshold from $750,000 to $3 million on the requirement 
to use the two-phase selection procedure for design and 
construction contracts. The amendment was adopted by voice 
vote.

                        Committee Consideration

    On May 17, 2016, the Committee met in open session and 
ordered reported favorably the bill, H.R. 5199, as amended, by 
voice vote, a quorum being present.

                            Roll Call Votes

    No roll call votes were requested or conducted during Full 
Committee consideration of H.R. 5199.

              Application of Law to the Legislative Branch

    Section 102(b)(3) of Public Law 104-1 requires a 
description of the application of this bill to the legislative 
branch where the bill relates to the terms and conditions of 
employment or access to public services and accommodations. 
This bill makes amendments to improve competition in the area 
of federal construction contracting. As such this bill does not 
relate to employment or access to public services and 
accommodations.

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 3(c)(1) of rule XIII and clause 
(2)(b)(1) of rule X of the Rules of the House of 
Representatives, the Committee's oversight findings and 
recommendations are reflected in the descriptive portions of 
this report.

         Statement of General Performance Goals and Objectives

    In accordance with clause 3(c)(4) of rule XIII of the Rules 
of the House of Representatives, the Committee's performance 
goals and objectives of the bill are to improve the manner in 
which Federal contracts for construction and design services 
are awarded, and to prohibit the use of reverse auctions for 
design and construction services procurements.

                    Duplication of Federal Programs

    No provision of this bill establishes or reauthorizes a 
program of the Federal Government known to be duplicative of 
another Federal program, a program that was included in any 
report from the Government Accountability Office to Congress 
pursuant to section 21 of Public Law 111-139, or a program 
related to a program identified in the most recent Catalog of 
Federal Domestic Assistance.

                  Disclosure of Directed Rule Makings

    The Committee estimates that enacting this bill does not 
direct the completion of any specific rule makings within the 
meaning of 5 U.S.C. 551.

                     Federal Advisory Committee Act

    The Committee finds that the legislation does not establish 
or authorize the establishment of an advisory committee within 
the definition of 5 U.S.C. App., Section 5(b).

                       Unfunded Mandate Statement

    Section 423 of the Congressional Budget and Impoundment 
Control Act (as amended by Section 101(a)(2) of the Unfunded 
Mandate Reform Act, P.L. 104-4) requires a statement as to 
whether the provisions of the report include unfunded mandates. 
In compliance with this requirement the Committee has received 
a letter from the Congressional Budget Office included herein.

                         Earmark Identification

    This bill does not include any congressional earmarks, 
limited tax benefits, or limited tariff benefits as defined in 
clause 9 of rule XXI.

                           Committee Estimate

    Clause 3(d)(1) of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison by the 
Committee of the costs that would be incurred in carrying out 
this bill. However, clause 3(d)(2)(B) of that rule provides 
that this requirement does not apply when the Committee has 
included in its report a timely submitted cost estimate of the 
bill prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974.

     Budget Authority and Congressional Budget Office Cost Estimate

    With respect to the requirements of clause 3(c)(2) of rule 
XIII of the Rules of the House of Representatives and section 
308(a) of the Congressional Budget Act of 1974 and with respect 
to requirements of clause (3)(c)(3) of rule XIII of the Rules 
of the House of Representatives and section 402 of the 
Congressional Budget Act of 1974, the Committee has received 
the following cost estimate for this bill from the Director of 
Congressional Budget Office:

                                                     June 13, 2016.
Hon. Jason Chaffetz,
Chairman, Committee on Oversight and Government Reform,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 5199, the 
Construction Consensus Procurement Improvement Act of 2016.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Pickford.
            Sincerely,
                                                        Keith Hall.
    Enclosure.

H.R. 5199--Construction Consensus Procurement Improvement Act of 2016

    H.R. 5199 would modify the federal government's procedures 
for awarding design and construction contracts for federal 
facilities and would prohibit the use of reverse auctions for 
such awards. Specifically, the legislation would require a two-
phase selection process for designing and constructing any 
federal facility with a cost of more than $3 million. In phase 
one, firms would provide basic information on their experience 
and past performance; agencies then would select a few firms 
and invite them to submit a more detailed proposal in phase 
two.
    CBO reviewed information on the process of awarding 
construction contracts by the Army Corps of Engineers (Corps) 
and the General Services Administration (GSA), two agencies 
that oversee construction of many federal facilities. Those 
agencies often use a two-phase process to select firms for 
construction projects but also use other acquisition strategies 
to award contracts. On the basis of information from those 
agencies, CBO estimates that implementing H.R. 5199 would cost 
$3 million over the 2017-2021 period--about $600,000 a year--
because agencies that currently evaluate projects using a one-
phase process would incur somewhat higher costs to evaluate two 
rounds of proposals before selecting a firm for each 
construction project.
    CBO also reviewed information on the use of reverse 
auctions in government procurement contracts by the Corps and 
GSA. Those agencies have found that using reverse auctions in 
complex procurements does not consistently result in lower 
procurement costs than would result from other methods such as 
sealed bids or negotiated procurements. Those agencies 
generally do not use reverse auctions to obtain such services. 
On that basis, CBO estimates that implementing H.R. 5199 would 
not result in a significant change in the government's bidding 
practices and thus would not have a significant effect on the 
federal budget.
    Because enacting the bill could affect direct spending by 
agencies not funded through annual appropriations, pay-as-you-
go procedures apply. CBO estimates, however, that any net 
change in spending by those agencies would be negligible. 
Enacting the bill would not affect revenues. CBO estimates that 
enacting H.R. 5199 would not increase net direct spending or 
on-budget deficits in any of the four consecutive 10-year 
periods beginning in 2027.
    H.R. 5199 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act and 
would not affect the budgets of state, local, or tribal 
governments.
    On March 29, 2016, CBO transmitted a cost estimate for S. 
1526, the Construction Consensus Procurement Improvement Act of 
2015, as ordered reported by the Senate Committee on Homeland 
Security and Governmental Affairs on February 10, 2016. S. 1526 
and H.R. 5199 are similar, although H.R. 5199 would require 
agencies to use a two-phase selection process for the design 
and construction of facilities with a cost greater than $3 
million. S. 1526 which would impose the process for facilities 
with a cost greater than $750,000. CBO estimates that the 
process imposed in H.R. 5199 would be less costly.
    The CBO staff contacts for this estimate are Matthew 
Pickford and Aurora Swanson. This estimate was approved by H. 
Samuel Papenfuss, Deputy Assistant Director for Budget 
Analysis.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, and existing law in which no 
change is proposed is shown in roman):

                      TITLE 41, UNITED STATES CODE




           *       *       *       *       *       *       *
SUBTITLE I--FEDERAL PROCUREMENT POLICY

           *       *       *       *       *       *       *


CHAPTER 33--PLANNING AND SOLICITATION

           *       *       *       *       *       *       *



Sec. 3309. Design-build selection procedures

  (a) Authorization.--Unless the traditional acquisition 
approach of design-bid-build established under sections 1101 to 
1104 of title 40 or another acquisition procedure authorized by 
law is used, the head of an executive agency shall use the two-
phase selection procedures authorized in this section for 
entering into a contract for the design and construction of a 
public building, facility, or work when a determination is made 
under subsection (b) that the procedures are appropriate for 
use.
  [(b) Criteria for Use.--A contracting officer shall make a 
determination whether two-phase selection procedures are 
appropriate for use for entering into a contract for the design 
and construction of a public building, facility, or work when--
          [(1) the contracting officer anticipates that 3 or 
        more offers will be received for the contract;
          [(2) design work must be performed before an offeror 
        can develop a price or cost proposal for the contract;
          [(3) the offeror will incur a substantial amount of 
        expense in preparing the offer; and
          [(4) the contracting officer has considered 
        information such as the following:
                  [(A) The extent to which the project 
                requirements have been adequately defined.
                  [(B) The time constraints for delivery of the 
                project.
                  [(C) The capability and experience of 
                potential contractors.
                  [(D) The suitability of the project for use 
                of the two-phase selection procedures.
                  [(E) The capability of the agency to manage 
                the two-phase selection process.
                  [(F) Other criteria established by the 
                agency.]
  (b) Criteria for Use.--
          (1) Contracts with a value of at least $3,000,000.--
        Two-phase selection procedures shall be used for 
        entering into a contract for the design and 
        construction of a public building, facility, or work 
        when a contracting officer determines that the project 
        has a value of $3,000,000 or greater, as adjusted for 
        inflation in accordance with section 1908 of this 
        title.
          (2) Contracts with a value less than $3,000,000.--For 
        projects that a contracting officer determines have a 
        value of less than $3,000,000, the contracting officer 
        shall make a determination whether two-phase selection 
        procedures are appropriate for use for entering into a 
        contract for the design and construction of a public 
        building, facility, or work when--
                  (A) the contracting officer anticipates that 
                3 or more offers will be received for the 
                contract;
                  (B) design work must be performed before an 
                offeror can develop a price or cost proposal 
                for the contract;
                  (C) the offeror will incur a substantial 
                amount of expense in preparing the offer; and
                  (D) the contracting officer has considered 
                information such as--
                          (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 
                        procedures;
                          (v) the capability of the agency to 
                        manage the two-phase selection process; 
                        and
                          (vi) other criteria established by 
                        the agency.
  (c) Procedures Described.--Two-phase selection procedures 
consist of the following:
          (1) Development of scope of work statement.--The 
        agency develops, either in-house or by contract, a 
        scope of work statement for inclusion in the 
        solicitation that defines the project and provides 
        prospective offerors with sufficient information 
        regarding the Federal Government's requirements (which 
        may include criteria and preliminary design, budget 
        parameters, and schedule or delivery requirements) to 
        enable the offerors to submit proposals that meet the 
        Federal Government's needs. If the agency contracts for 
        development of the scope of work statement, the agency 
        shall contract for architectural and engineering 
        services as defined by and in accordance with sections 
        1101 to 1104 of title 40.
          (2) Solicitation of phase-one proposals.--The 
        contracting officer solicits phase-one proposals that--
                  (A) include information on the offeror's--
                          (i) technical approach; and
                          (ii) technical qualifications; and
                  (B) do not include--
                          (i) detailed design information; or
                          (ii) cost or price information.
          (3) Evaluation factors.--The evaluation factors to be 
        used in evaluating phase-one proposals are stated in 
        the solicitation and include specialized experience and 
        technical competence, capability to perform, past 
        performance of the offeror's team (including the 
        architect-engineer and construction members of the 
        team), and other appropriate factors, except that cost-
        related or price-related evaluation factors are not 
        permitted. Each solicitation establishes the relative 
        importance assigned to the evaluation factors and 
        subfactors that must be considered in the evaluation of 
        phase-one proposals. The agency evaluates phase-one 
        proposals on the basis of the phase-one evaluation 
        factors set forth in the solicitation.
          (4) Selection by contracting officer.--
                  (A) Number of offerors selected and what is 
                to be evaluated.--
                          (i) the technical submission for the 
                        proposal, including design concepts or 
                        proposed solutions to requirements 
                        addressed within the scope of work, or 
                        both; and
                          (ii) the evaluation factors and 
                        subfactors, including cost or price, 
                        that must be considered in the 
                        evaluations of proposals in accordance 
                        with subsections (b) to (d) of section 
                        3306 of this title.
                  (B) Separate evaluations.--The contracting 
                officer separately evaluates the submissions 
                described in clauses (i) and (ii) of 
                subparagraph (A).
          (5) Awarding of contract.--The agency awards the 
        contract in accordance with chapter 37 of this title.
  (d) Solicitation To State Number of Offerors To Be Selected 
for Phase-Two Requests for Competitive Proposals.--A 
solicitation issued pursuant to the procedures described in 
subsection (c) shall state the maximum number of offerors that 
are to be selected to submit competitive proposals pursuant to 
subsection (c)(4). The maximum number specified in the 
solicitation shall not exceed 5 unless the agency determines 
with respect to an individual solicitation that a specified 
number greater than 5 is in the Federal Government's interest 
and is consistent with the purposes and objectives of the two-
phase selection process.
  (e) Requirement for Guidance and Regulations.--The Federal 
Acquisition Regulation shall include guidance--
          (1) regarding the factors that may be considered in 
        determining whether the two-phase contracting 
        procedures authorized by subsection (a) are appropriate 
        for use in individual contracting situations;
          (2) regarding the factors that may be used in 
        selecting contractors; and
          (3) providing for a uniform approach to be used 
        Government-wide.

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