Why the Federal Reserve Building’s Renovation Costs $2.5 Billion

Allies of President Donald Trump are pressing for aninvestigation into the ongoing restoration of the Federal Reserve’s headquarters, costs for which have ballooned to $2.5 billion.

Any evidence of mismanagement or fraud, as White House officials have suggested, could prove a useful pretext for removing Fed Chair Jerome Powell, whose resistance to cutting interest rates this year has angered the president.

But the price tag has less to do with “ostentatious” features than the challenges of building — particularly underground — in what was once a swamp near the Tidal Basin along the Potomac River.

Foundation work for the Fed expansion was so difficult that contractors responsible for ...