House Financial Services Committee Chairman Jeb Hensarling (R-Texas) grilled CFPB Director Richard Cordray Tuesday over the $114 million that the CFPB is spending on the renovation of the agency’s leased building.
Referencing the CFPB’s latest financial report, Hensarling asked Cordray if updating the HVAC and electrical system in the building would cost $145 million.
“No, and there have been different numbers here, and the most recent number that I’ve seen is $114 million. What I am told is that about two-thirds of it is required in order to upgrade the basic structure of the building,” Cordray said. “We bought a tough building apparently, and when I say bought, we have leased a tough building.”
Hensarling responded, saying, “You’re renovating a building you do not own, putting in almost as much as the entire value of the building.”
He went on to list comparable real estate costs, quoting Cordray in a previous hearing, saying that the agency “not building some palace for the bureau over the long-term.”
“Apparently your renovation cost is now $483 per square foot, which is triple the typical Washington, D.C., luxury commercial class – a luxury renovation rate of $150 per square feet,” Hensarling said. “Three times as much as the DC metro area. You are spending more per square foot than the Trump World Tower, which came in a $334 per square feet.”
Hensarling also said the CFPB’s building is more expensive than the Burj Khalifa, the tallest skyscraper in the world, located in Dubai, which cost approximately $450 per square feet.
“What on God’s green earth is going on here? Explain to me, Mr. Director, why I shouldn’t be outraged and why the American people shouldn’t be outraged?” he asked.
“We do not own this building; it is an asset of the Federal Government; it is owned by the Comptroller of the Currency. We have leased the building,” Cordray said.
“The renovations that are performed there will make the building serviceable for years to come, probably far outlasting the time of our lease. The notion that we would try to build some palace that we don’t even own or control doesn’t make much sense to me,” he added.
Cordray also said CFPB’s 1,000 employees have to vacate the building during the renovation process.
“My guess is cheaper space could have been found in Reston and the American taxpayers would have appreciated it,” Hensarling said.
“We looked around at surrounding areas as well,” Cordray responded.
Rep. Patrick McHenry (R-N.C.) said the committee first found out that the CFPB was spending $55 million on renovation, then $95 million and now $150 million.
“It seems a little insane that you’re spending $150 million of taxpayer money, and spending $12 million in rent, and you’re not even going to be in it,” McHenry said.
“Look, there’s much that I’m unhappy with about this situation. It’s a building that’s a deteriorated building,” Cordray responded.
“If I were a consumer, I would be complaining a lot about that building if I owned it,” he added.