Latest CFPB Renovation Price Tag: $216M
The total price tag for the renovation of the CFPB’s leased headquarters is currently $215.8 million, representing an increase of $120 million from last year’s evaluation, according to a recently released Federal Reserve Inspector General’s report.
The IG report also said the CFPB’s Investment Review Board did not follow all internal guidelines for approval of the renovation.
“We noted that the $55 million and $95 million budget amounts for the renovation for fiscal year (FY) 2012 and FY 2013, respectively, were published in the CFPB’s public budget documents. Approvals through decision memorandums were obtained for these amounts,” said the Fed’s IG report dated July 2.
According to the IG, the renovation project budget was increased from $95 million to $111.4 million in May 2013. In September 2013, the budget was raised to $145.1 million.
“Based on the CFPB’s assessed requirements as of June 5, 2014, we currently estimate all-in costs to total approximately $215.8 million. These estimated all-in costs include the $145.1 million obligated for construction, construction management, and GSA fees, as well as $70.7 million for other items including A/E services, rent for swing space, costs associated with moving and additional renovation-related expenses,” the report said.
The IG found that the CFPB failed to follow all internal Investment Review Board guidance when finishing the business case for the renovation project.
“The CFPB listed alternatives in the IRB business case but did not complete any analyses of those alternatives. In addition, the performance section did not include any quantitative information or calculations related to return on investment,” said the report. “We noted that the IRB approved the business case for the building renovation in September 2013 even though it was incomplete.”
According to the IG, CFPB officials said the IRB approved the incomplete business case because the decision to proceed with the renovation had already been made.
The report said the Fed’s IG would monitor the costs and refine its estimate as the ongoing project develops.
According to a House Financial Services Committee press release, the CFPB is currently spending more per square foot than the construction of the Trump World Tower ($334 per square foot) and the Burj Khalifa in Dubai ($450 per square foot).
Rep. Patrick McHenry, chairman of the Financial Services Oversight and Investigations Subcommittee, said the IG report has raised more questions about the CFPB.
"The findings of the Inspector General's investigation are deeply troubling and lead to even more questions about the unaccountable design of the CFPB,” said McHenry, who initially requested the IG evaluate the renovation project. “The continuously growing price tag is a tremendous waste of funds and, amazingly, there is still no assurance the $216 million price tag won't grow higher.”