Fed Renovation Cleared

Federal Reserve Watchdog Finds No Misconduct in Cost-Heavy Headquarters Renovation

The Federal Reserve’s inspector general found no evidence that the renovation of the central bank’s Washington headquarters violated federal law or that former Chair Jerome Powell committed administrative misconduct, and found no basis for a prosecution referral. The report said weak project management, inadequate cost estimates and contract oversight contributed to costs rising from about $1.3 billion to an estimated $2.4 billion to $2.5 billion; inflation, design changes, limited contractor bids and site conditions also played a role. The renovation became a flashpoint in President Donald Trump’s dispute with Powell over interest rates, and the Justice Department opened and later dropped a criminal investigation into Powell’s congressional testimony. The Fed says it will follow the watchdog’s recommendations, including having the General Services Administration take over project management and commissioning an independent review of costs already awarded.

Key Points

Topics