Jerome Powell Asks for Probe of Fed’s $2.5B Renovation

The costly renovation of the Federal Reserve’s main offices in Washington, D.C. has become a lightning rod with an impact well beyond real estate.

Federal Reserve chair Jerome Powell requested this week that the central bank’s inspector general review the $2.5 billion headquarters renovation, Axios reported. The two historic buildings on the National Mall are in the midst of a major overhaul, originally projected to cost $1.9 billion, according to NPR; cost overruns are tied to excess lead and asbestos, as well as inflation, according to the Fed.

Inspector General Michael Horowitz is tasked with reviewing the costs of the project, as well as anything else he deems necessary. His office previously reviewed the project before heightened scrutiny created by President Donald Trump’s administration.

The renovation project has been in the works since it was approved in 2021. The Federal Reserve Act gives the Fed’s Board of Governors authority over real estate decisions.

But the White House and congressional allies of the president have blasted the Fed for a project they claim is excessive.

Trump recently tapped allies to lead the National Capital Planning Commission, which is responsible for resolving design issues for federal buildings. Russ Vought, director of the Office of Management and Budget and architect of Project 2025, recently said in a pointed letter to Powell, implying the Fed was out of compliance with the National Capital Planning Act.

Planning documents for the renovation include a private elevator for an executive dining room and rooftop gardens with beehives. But Powell has refuted that many high-end features are part of the final plan for the project, telling Congress in June that there were “no new water features … no beehives and there’s no roof terrace garden.”

Trump has previously targeted Powell, airing his frustrations regarding the Fed chair’s decision not to cut interest rates in recent months. Powell, whose term leading the agency runs through May 2026, has said he will not step down early.

— Holden Walter-Warner