On April 16, a heating unit on the seventh floor of the city’s Department of Consumer and Regulatory Affairs (DCRA) malfunctioned, sending sparks and flames up the wall. The mishap occurred in the middle of the workday, so alert staffers dashed to activate the fire alarms. The alarms didn’t ring—an ironic bit of dysfunction for an agency charged with policing building and fire codes across the city.

While the alarms hung silent, DCRA officials somehow managed to spread word of the fire and evacuate the building, sending the agency’s 300-plus employees spilling out into the streets of Chinatown. Crews from the D.C. fire department (DCFD) arrived promptly and extinguished the small fire in just a few minutes, according to fire inspector William Guffey.

After the firefighters exited the building, DCRA Director W. David Watts ordered workers back to their desks, according to three DCRA employees. Watts’ decision violated every code in the book, not to mention common sense: He was sending his underlings into a rotting dump with no working alarms that had just caught fire. As department drones slogged back to their places, water was gushing down the stairways and seeping into the electrical system, boosting the chances of a more damaging blaze, according to Guffey.

While most employees grumbled on their way back into the building, one phoned fire marshal Alexander Bullock to complain about Watts’ mandate. “The complainant was concerned about the condition of the building and that people had re-entered the building after the fire,” says Bullock, who declined to identify the complainant. Bullock dispatched Guffey to the scene, where he ordered another evacuation and various repairs to bring the building up to code.

The D.C. financial control board last week saved DCRA employees from their slow burn under Watts. After learning on Thursday evening of the board’s plans to dismiss him, Watts resigned from the post he had held since September. Dwight Reeves, one of Watts’ deputies, was installed on Friday as acting director. The board’s shove came at the initiative of Chief Management Officer (CMO) Camille Cates Barnett.

By coupling its dismissal of Watts with a docket of fiats streamlining D.C. business regulations, the board sought to portray itself as an agent of change and an avatar of competent management in a crumbling city.

It didn’t work. People won’t forget that just last September, the board confirmed Watts as DCRA head despite reams of evidence that he was not suited for the job. Among his shortcomings, Watts had left $55 million in federal grants unspent as head of the Department of Housing and Community Development. And as D.C.’s economic development czar, Watts had negotiated the lease agreement for development of Children’s Island, a faintly disguised giveaway that the board itself spiked.

The board’s confirmation of Watts made it a full participant in the ongoing mismanagement in D.C. government agencies—a scourge that it was appointed in 1995 to eradicate.

There are lots of ways to inspire confidence as DCRA director. Pore over the municipal regulations that the agency enforces. Reach out to community groups. Obsess over reducing permit processing times.

Watts, however, took a different approach: Play computer games.

According to several DCRA employees, the former director spent nearly as much time at his computer playing Hearts and other games as banging out memos or finessing the agency budget. “I have trouble remembering seeing anything but games up on his computer,” says one DCRA employee. In the words of another, “You have to wait for the guy to kill his last zombie before he’s ready to meet with you.”

Not that agency staffers benefited from caucusing with Watts. In a series of meetings throughout the agency last year, Watts issued vaguely worded goals and benchmarks for DCRA’s various offices. On one point, however, the director made himself perfectly clear: “He said, ‘If I go down, I’ll be dragging a few of you out the door with me,’” says a DCRA source. (Watts declined an interview with Washington City Paper.)

With that kind of leadership, Watts preserved DCRA as a reminder of just how bad municipal government can get. While other agencies—notably the Department of Public Works and the Department of Finance and Revenue—have at least improved during the control board era, DCRA has gone backward. Delivery of core agency services—enforcement of zoning regulations, building codes, and liquor laws—is no better than in the dark days of Marion Barry-inspired languor.

“Inspectors are simply nowhere to be found,” says Ward 6 Councilmember Sharon Ambrose, who last September voted against Watts’ appointment to head DCRA. “You send requests over there, and it’s just a black hole.”

Indeed, Watts stocked the department with just enough front-line personnel to serve…Dale City. There are four alcoholic beverage control (ABC) inspectors to police the city’s 1,700 liquor-licensed establishments. The District’s 1998 budget legislation mandated that the agency hire 12 additional inspectors, a directive that Watts all but ignored. And District businesses contemplating violating zoning regulations are well advised to go ahead: DCRA employs only two zoning inspectors.

Restaurant-goers, however, need not suffer indigestion over the agency’s malaise—DCRA recently transferred its health code-enforcement squad to the health department.

Even though Watts is finally gone, agency employees say that his short tenure set DCRA back years. “DCRA is ground zero in the fight to reform the District government,” says Chief Financial Officer Anthony Williams.

At a March 12 hearing of the D.C. Council’s committee on consumer and regulatory affairs, Watts touted his accomplishments as DCRA director. During fiscal year 1997, Watts boasted, the agency issued over 39,000 occupational and professional licenses, adjudicated 2,206 civil infractions yielding $647,480 in revenue, and closed 631 regulatory investigations.

In the next breath, Watts trotted out Business Bytes, the agency’s brand-new quarterly newsletter. According to Watts, the newsletter “highlights the management reforms undertaken by the department and announces accomplishments and customer benefits.” Watts continued, “We hope that you and other members of the council as well as DCRA customers will find the newsletter informative and helpful.”

Amid all the boosterism, Watts failed to mention one point: how he was funding the newsletter, a question that one of his subordinates later answered.

Rental Housing Commission Chair Ruth Banks runs her office with little help from support staff. The commission adjudicates the city’s rent control program—a function heavy on paperwork, filing, and other clerical miscellany. Banks has only temporary staff to manage the commission’s office.

This spring, Banks sought to recruit permanent support staff with the funds remaining in her fiscal year 1998 budget, according to DCRA sources. When she checked her allotment, however, she found that it was overdrawn.

The culprit? Business Bytes, among other expenditures. Watts had raided the rent control program to pay for his newsletter.

“I was embarrassed to see the director promote the newsletter as one of his major accomplishments before the D.C. Council. It’s not major, and it’s not an accomplishment,” notes a DCRA employee.

Watts himself frequently bemoaned the paucity of funds available for DCRA’s myriad functions. During this year’s budget cycle, he proclaimed that drastic cuts would be in order if the city didn’t boost DCRA’s budget. When asked by CFO Williams how he would react to a slight budget cut, Watts responded by putting one of DCRA’s most efficient offices on the chopping block: the historic preservation division, which keeps developers from razing the District’s architectural gems.

Watts no doubt invoked the sacrosanct office to draw the public into DCRA’s budgetary battle. But what he intended as a show of political skill exposed his unfamiliarity with his own agency. The historic preservation division derives nearly half of its funding—$242,000—from federal grants, making it impossible to zero out its budget.

“I’m not sure how [Watts] would have done that,” says Charles Robertson, a member of the D.C. Historic Preservation Review Board. “Would he just give back the federal grant money?”

Sally Berk, president of the D.C. Preservation League, said her phones were ringing off the hook after Watts’ proposal surfaced. When Berk inquired about the matter, Watts told her that historic preservation would survive. “He said that he had proposed the most absurd scenario,” says Berk.

Damage from Watts’ gaffes didn’t normally go beyond embarrassing the department and confounding DCRA observers. There were exceptions, of course.

On Friday, Dec. 5, Watts met with Ward 3 activist Phil Mendelson to discuss a pending regulatory matter in his 11th-floor DCRA office. Watts’ choice of office guests was curious, for Mendelson had testified a few months earlier against Watts’ appointment, saying, “[Watts] has failed to distinguish himself either as a good manager, reformer, or economic rainmaker.”

At the time, however, Watts was looking to shore up his support outside the agency, and he had just the goods for Mendelson.

As chair of the Cleveland Park advisory neighborhood commission, Mendelson was fighting to prevent MVC Latenight, a video outlet that carries X-rated material, from opening on upper Wisconsin Avenue. Zoning regulations disallowed “sexually oriented businesses” in MVC’s space, but DCRA had yet to define just what that meant.

During their meeting, Watts handed Mendelson various DCRA documents related to the MVC zoning dust-up. Agency officials involved in the matter say Watts’ disclosures compromised their adjudication of the dispute between the video store and neighborhood activists. “I received a number of documents,” concedes Mendelson. “I don’t think it’s appropriate for me to comment on whether it was appropriate for Mr. Watts to give them to me.”

Appropriate or not, Watts’ powwow with Mendelson surely won’t help the agency defend itself against a pleading recently filed by MVC in DCRA’s office of adjudication. The pleading comes in response to a DCRA initiative to revoke MVC’s certificate of occupancy, and it alleges a DCRA conspiracy to drive the outlet out of business. Paul Cambria, who is representing MVC, says the pleading seeks to subpoena every DCRA official involved in handling the dispute. “One obvious question I have for them is, Why did they bring action against only us?” asks Cambria. “Why just us, when there are 15 other stores with more [sexually oriented] content than us?”

Revelations on the coziness between Watts and MVC opponents can only bolster the store’s case.

In his three years as control board chair, Andrew Brimmer has employed every rhetorical device at his disposal to express outrage over D.C. government mismanagement. When it comes to Watts’ disastrous run at DCRA, however, Brimmer and other board members had no choice but to hold their fire. Watts, after all, was their guy.

And to appreciate just what kind of manager they had put at DCRA’s helm, they didn’t have to look much farther than the proposed lease Watts cooked up for Children’s Island theme park. Last October, a corporation counsel lawyer named Maria E. Holleran Rivera testified before the D.C. Council on the lease negotiations.

Rivera’s testimony—and a widely circulated memo she had written a few weeks earlier—highlighted some questionable provisions in the lease agreement, which would have transferred two island properties to a private developer. For one, the lease would have allowed the developer to “flip” the property to another entity with only perfunctory review by city authorities. It also would have put constraints on the city’s ability to sue the developer—a provision that Rivera termed “extraordinary.” To top it off, the lease would have enabled the developer to sue the city if hazardous materials cleanup costs exceeded $250,000. “We recommend against [the provision],” wrote Rivera.

Those provisions, of course, weren’t the brainchild of Rivera. They were the handiwork of Watts, who held negotiating authority for the Children’s Island lease when he served as the city’s economic development czar.

“It was an incredibly bad deal, and Watts was the point man,” says Capitol Hill activist Dick Wolf.

The control board agreed with Wolf and killed the deal in February.

Watts would still be perpetrating his unique brand of management at DCRA if not for Barnett. D.C. councilmembers and DCRA staffers treated Barnett to impromptu anti-Watts briefings and suggested that the CMO focus her reform efforts on the ailing agency.

In late March, Barnett got a look at the inimitable Watts style for herself when she hosted a major interagency meeting. Watts showed up in a sweat suit.

In a series of appearances before community groups all over town, Barnett this spring stood like a dartboard for citizens upset with Watt’s performance at the agency. The CMO was guest of honor at the March 5 meeting of D.C. Watch, hosted by Columbia Heights activist Dorothy Brizill. “By the end of the meeting,” recalls Brizill, “people were shouting, ‘Fire David Watts!’”CP