Her selection was announced by the ALP on Thursday.
Ms Crugnale, who has worked in community arts and community development projects, was a Bass Coast councillor from 2012-16 and mayor in 2016. She did not seek re-election in last year’s council election.
She takes on the current Liberal MP for Bass, Brian Paynter, who won the 2014 election with 54.55 per cent of the vote after preferences were distributed. The ALP was second with 45.45 per cent.