Fed’s Powell asks for watchdog review of project criticized by Trump officials
Federal Reserve Chair Jerome Powell has asked the U.S. central bank’s inspector general to review the costs involved in the renovation of its historic headquarters in Washington, as Trump administration officials intensify their criticism of how the Fed is being run.
"I have asked the Board’s IG to take a fresh look at the project," Powell told Senate Banking Committee Chair Tim Scott and the panel’s top Democrat, Elizabeth Warren, in a letter dated Monday and viewed by Reuters.
The letter, first reported by Politico, responded to concerns raised by the Trump administration and Republican lawmakers about the renovation. The letter said that some features that had drawn criticism -- including VIP elevators or dining rooms -- had never been in the project’s scope, and others, including new water features, had been eliminated. Changes to the original design were not substantial and "none of them added cost to the project," Powell wrote.
The request to Fed Inspector General Michael Horowitz, first reported by Axios, was made over the weekend, according to a source familiar with the matter.
It follows a letter to Powell last week from the director of the Office of Management and Budget, Russell Vought, who wrote that President Donald Trump was "extremely troubled" by cost overruns in the $2.5 billion project.
"The Chairman looks forward to receiving additional information about the costly renovations at the Fed’s headquarters," a spokesperson for Scott said in response to the letter, adding that the letter was consistent with improving transparency.
The Senate Banking committee oversees the Fed.
In material posted to its website on Friday and summarized in Powell’s letter to the senators, the Fed said the cost overruns were driven by factors including higher-than-estimated materials and labor costs, as well as toxic contamination in the soil that came to light during what is a complete rehabilitation of the nearly 100-year-old Marriner S. Eccles building and a neighboring property on Constitution Avenue in the nation’s capital.
"We respect the critical importance of the constitutionally-derived congressional oversight of our activities, and we are committed to working collaboratively and cooperatively with you," Powell wrote to the senators.
OMB has no oversight over the Fed, which funds its own operations separately from the appropriations process in Congress. The Federal Reserve Act also gives the central bank’s seven-member Board of Governors control over its building and related projects, with oversight by Congress and the Fed’s independent IG, which has been reviewing the renovations throughout the process.
source: Investing.com
