Fed Renovation Costs Soar to $2.4 Billion Amid Trump-Powell Feud
The Federal Reserve's renovation of its Washington headquarters has been at the center of controversy since last year. The project, initially budgeted for $1.3 billion in 2020, ended up costing $2.4 billion. President Donald Trump and Republican lawmakers accused the Fed of overspending and extravagant designs.
A report by the Office of Inspector General found no evidence of criminal wrongdoing but highlighted a series of missteps that led to cost overruns. The watchdog identified failings linked to cost overruns on a previous project, which the Fed's board failed to address. Key issues included substantial cost increases due to a lack of bids for some work and internal governance not equipped to handle projects of this magnitude.
The report recommended corrective actions, including ensuring best value is secured as work is completed, establishing a project-cost and schedule-success metric, and delegating responsibility to an oversight body. Fed Chairman Kevin Warsh said the central bank would implement these recommendations and engage an independent auditor to scrutinize all awarded costs.