Fed's Warsh cracks down on HQ renovation, taps GSA to lead

Key Points:

• The Federal Reserve has appointed the General Services Administration (GSA) to manage the completion of its over $2 billion costly renovation project, following significant cost overruns and delays.
• A recent Inspector General report found no administrative misconduct but highlighted mistakes, inflation, and lapses in project management that contributed to the project's budget increasing from $1.317 billion in 2020 to $2.381 billion by 2024, with completion delayed to the end of 2027.
• Fed Chair Kevin Warsh, who took office recently, requested GSA's involvement due to their expertise in federal construction and real estate, aiming to improve accountability, cost discipline, and project management.
• The Fed plans to implement IG recommendations including setting a guaranteed maximum price, fixed budget and schedule metrics, contract reviews, and stronger internal controls to ensure timely and efficient project completion.
• The report and project delays have drawn criticism, including from former President Donald Trump, who has called for former Fed Chair Jerome Powell's resignation and threatened legal action; Powell was chairman during the project's initiation.