Could a Building Renovation Sink Jerome Powell?

President Trump on Tuesday suggested he has finally found a way to achieve his goal of removing Federal Reserve Chair Jerome Powell. The president indicated that Powell's handling of an extensive renovation project on two Fed buildings in Washington could be grounds to take the unprecedented and possibly legally dubious step of firing him before his terms ends in May. "I think it sort of is," Trump said, per the AP. "When you spend $2.5 billion on, really, a renovation, I think it's really disgraceful," Trump said, adding that he never saw the Fed chair as someone who needed a "palace." The expense of the project is about $600 million more than was originally budgeted. What you need to know:

• The impetus: The Fed says its headquarters, known as the Marriner S. Eccles building, was in dire need of an upgrade because its electrical, plumbing, and HVAC systems, among others, are nearly obsolete and some date back to the building's construction in the 1930s. The renovation will also remove asbestos, lead, and other hazardous elements and update the building with modern electrical and communications systems.
• The spend: The Fed cites many reasons for the greater expense. Construction costs, including for materials and labor, rose sharply during the inflation spike in 2021 and 2022. More asbestos needed to be removed than expected.
• The hope: The Fed says the renovations will reduce costs "over time" because it will be able to consolidate its roughly 3,000 Washington-based employees into fewer buildings and will no longer need to rent as much extra space as it does now.

• The administration's take: The project has been underway for years, going back to Trump's first term. But it only recently caught the White House's attention. Russ Vought, the administration's top budget adviser, wrote Powell a letter last Thursday that said Trump is "extremely troubled" about the Fed's "ostentatious overhaul" of its facilities. The Fed's renovation plans call for "rooftop terrace gardens, VIP private dining rooms and elevators, water features, premium marble, and much more," Vought said in his letter.
• Powell pushes back: Powell has disputed those claims, which were given wide circulation in a paper issued by the Mercatus Center, a think tank at George Mason University, in March 2025. The paper was written by Andrew Levin, an economist at Dartmouth College and former Fed staffer. "There's no VIP dining room," Powell said last month during a Senate Banking Committee hearing. "There's no new marble. ... There are no special elevators. There are no new water features. ... And there's no roof terrace gardens." Some of those elements were removed from initial building plans submitted in 2021, the Fed says.
• The White House's other tactic: The Fed's changes to its building plans have opened it up to another line of attack: White House officials suggest the Fed violated the terms of the approval it received from a local planning commission by changing its plans. Essentially, White House officials are saying Powell is being reckless with taxpayer money because of the cost of the renovation, but they are also accusing him of acting unethically by scaling back the project to save money.
• Is the move doable? The Supreme Court recently signaled that the president can't fire Powell simply because Trump disagrees with him on interest rates. But legally he could do so "for cause," such as misconduct or dereliction of duty.