Jerome Powell defends the Fed's renovation project as Trump allies raise the stakes

Federal Reserve Chair Jerome Powell sent a letter to the White House on Thursday meant to counter a litany of attacks on the central bank's costly renovation project of its century-old headquarters in Washington D.C.

Powell has come under increasing scrutiny over a $2.5 billion project to upgrade the central bank's three-building campus near the National Mall. It has run $700 million over initial cost projections, drawing attacks from Trump allies that Powell has misused taxpayer money. It's another front in the Trump administration's offensive against the Fed for not lowering the cost of borrowing, and Fed observers say those criticisms are designed to establish a fireable offense for Powell.

In the letter, Powell said the project won't be building VIP elevators, private dining rooms, or other lavish perks and pointed to a new section of the Fed's website with a FAQ about the renovation.

"We take seriously the responsibility to be good stewards of public resources as we fulfill the duties given to us by Congress on behalf of the American people," Powell wrote in the letter to White House budget director Russell Vought. He was responding to an earlier request from Vought for more details about the scope of the project's renovations.

Powell said he had requested the inspector general to review the project once more, and the budget has been continuously overseen by the Board of Governors since the renovation kicked off in 2017.

The Fed isn't actually operated with taxpayer-dollars or other legislative appropriations. It operates more like a self-funded bank, drawing its budget from the interest on government securities and later transferring over any excess profits to the Treasury.

Powell's defense comes two days after President Donald Trump flirted with firing him during a private meeting with conservative Republicans. He later poured cold water on the idea in public but kept the door open to changing his mind on the subject.

Republican hard-liners in Congress are also stepping up their support of Trump's pressure campaign against the central bank. Rep. Anna Paulina Luna of Florida posted on social media Thursday evening that she is "criminally referring" Powell to the Department of Justice.

A Federal Reserve spokesperson didn't respond to a request for comment.

Referrals from members of Congress or committees are non-binding, so the DOJ isn't required to launch an investigation. Yet they still can influence the agency's decision-making on whether certain matters should be probed further or not.