Federal Reserve Chair Defends $2.5 Billion Headquarters Renovation Amid White House Criticism

Federal Reserve Chair Jerome Powell has defended the central bank’s $2.5 billion renovation of its historic Washington, D.C., headquarters against criticism from the White House. Powell responded to a letter from Russell Vought, director of the White House Office of Management and Budget, who accused Powell of wasteful spending and mismanagement of the project. Vought had given Powell a seven-day deadline to answer a series of questions about the renovation, which had exceeded its original budget. The letter highlighted increasing tensions between the Federal Reserve and allies of President Donald J. Trump.

Powell’s response was measured and focused on transparency. He directed Vought to a new section of the Federal Reserve’s website that provides detailed information about the project, including budgets, schedules, and design choices. Powell emphasized the importance of transparency and accountability to the public. He did not address Vought’s political accusations, such as claims of mismanagement or misleading Congress.

Vought’s complaint included sensational claims about luxury amenities in the renovation, such as private elevators, exclusive dining rooms, and a rooftop garden. Powell strongly denied these claims. A Federal Reserve official clarified that the renovation plans do not include private elevators or VIP lunchrooms, and the roof space will house essential mechanical equipment, not a garden or outdoor entertainment area. Powell explained that the renovation addresses aging infrastructure and safety issues, including seismic reinforcements, modern electrical and plumbing systems, and enhanced cybersecurity defenses. The project also aims to meet federal environmental standards and improve accessibility under the Americans with Disabilities Act.

Powell asserted that the renovation is a necessary and fiscally prudent investment to ensure the headquarters remains safe, functional, and operational for many years. He noted that the Federal Reserve is not typically subject to the National Capital Planning Commission’s review but chose to work with them to meet high design and planning standards. Despite Powell’s response, criticism from Trump allies is likely to continue. Vought plans to visit the office to review the project, and Rep. Anna Paulina Luna (R-FL) intends to urge the US Department of Justice to investigate Powell’s statements to Congress regarding the renovation.

This criticism is part of a broader effort to challenge Powell’s leadership. Trump, who nominated Powell, has frequently criticized the Fed Chair for monetary policy decisions. Trump has expressed concern that Powell is not supporting his public statements with concrete actions and has accused Powell of focusing on an expensive renovation project instead of addressing the nation’s economic challenges. Powell, however, maintains that the renovation is a long-deferred investment in infrastructure crucial for the Fed’s core operations, including monetary policy, financial oversight, and payment systems. Powell’s response may not settle the controversy and could signal the start of broader efforts to pressure him and steer the Fed in a different direction in the coming months.