quote:
Watchdog finds Fed mishandled renovations that Trump tried to oust Powell over
By Steve Thompson
September 30, 2026

The Federal Reserve failed to effectively oversee the renovation of its headquarters, letting construction costs more than double without ever locking in a price ceiling, the central bank’s inspector general found in a report released Wednesday.

Officials at the Fed failed to “take numerous actions available to it that could have better controlled costs and mitigated some of the significant construction cost increases,” the report said.
...

The Fed’s board approved a $1.3 billion budget for the project in 2020. By December 2024, it had grown to $2.4 billion, and the construction portion alone had more than doubled, from $921 million to $2 billion, according to the report.

Four years after construction began, the Fed still had not negotiated a guaranteed maximum price with its contractor, a key protection for building owners, the report found. Instead, it divided the work into 84 smaller packages with no overall cap, which the inspector general said effectively turned the deal into a riskier endeavor.

Four packages for mechanical, electrical and plumbing work came in nearly $500 million over estimates. The Fed did not take extra steps to independently check those prices because the project team “preferred to keep the project moving,” the report said.

LINK

Meanwhile, Fed attorneys basically spit on the IG findings, findings which equate to gross incompetence of Powell's Fed handling of the project.

quote:
“While the Board is working diligently to manage the significant costs that come with renovating historic buildings, the Federal Reserve has explained that over the seven years of this project there have been increases in building costs, increases in labor costs, problems with asbestos contamination, and other elements that have contributed to these overruns,” the Fed attorneys said in a legal filing. “Nothing about cost overruns for such a project is unusual or indicative of criminal activity.”

... and to be clear to the "It's not taxpayer money crowd," by law the Federal Reserve remits excess earnings (after expenses, dividends, and surplus requirements) to the U.S. Treasury, i.e. US Taxpayers. Those funds become general federal revenue.?

Weekly remittances ceased in September 2022 after the Fed’s interest expenses exceeded its interest income. Since then, under Powell's guidance, the Fed recorded a massively growing “deferred asset” (cumulative net losses that must be earned back before remittances can resume). As of late September 2026 that deferred asset stood at roughly $233 billion. The hole is so significant that it is unlikely the Fed will resume payments until well into the 2030's

Prior to the Powell Fed debacle, the last calendar year in which the Federal Reserve made no remittances to the Treasury was 1934!

The gross cost management in the Fed's construction project is manifested in lower eventual remittance back to the Taxpayer.