Fed appoints GSA to oversee $2 billion headquarters renovation after IG report
Federal Reserve Chair Kevin Warsh has assigned the General Services Administration to manage the stalled renovation of the Fed's headquarters, citing cost overruns and delays identified in an Inspector General report.
The Federal Reserve announced that the General Services Administration (GSA) will take over management of the multi-billion-dollar renovation of its headquarters buildings. The change follows a report from the Fed's Office of Inspector General that documented significant cost growth and schedule slips, though it found no administrative misconduct. The project’s estimated cost rose from $1.317 billion in early 2020 to $2.381 billion for completion in late 2027, well beyond the original target of the second quarter of 2024.
GSA Administrator Edward Forst said, "> GSA fully supports Chairman Kevin Warsh’s efforts to bring greater accountability, cost discipline, and effective project management to major renovation work across Federal Reserve facilities." He added that GSA will work closely with the Fed to apply its construction and real-estate expertise and to deliver better value for taxpayers.
In a letter dated Sept. 29, Chair Warsh explained that, effective immediately, GSA will serve as the project executive and report to the Fed. He said the Fed will adopt several IG-recommended measures, including a guaranteed maximum price, fixed budget and schedule metrics, contract reviews, and strengthened internal controls.
Warsh noted his familiarity with Forst and confidence in his private-sector experience handling large-scale construction. A senior administration official described GSA’s team as having decades of experience managing projects of similar magnitude and emphasized the priority of completing the renovation promptly while controlling costs.