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The current FBI headquarters on Pennsylvania Avenue NW.

Mayor Vince Gray wants the Federal Bureau of Investigation to move to Poplar Point—-that, anyway, is his official position. On Monday, the D.C. government submitted a proposal to the federal General Services Administration to build a new FBI headquarters at the waterfront location just east of the Anacostia River.

The agency is looking to leave its outmoded headquarters, the J. Edgar Hoover Building on Pennsylvania Avenue NW (land the federal government owns). It’s a prospect that’s already inspired proposals for new FBI sites from officials in Virginia and Maryland.

Gray’s plan would offer the agency one of the few available riverfront sites in the District. But if city officials are truly salivating at the possibility of more pedestrian-friendly retail in place of the FBI’s current concrete behemoth, they shouldn’t squander the opportunity for similar development on Poplar Point.

The FBI should leave D.C. And D.C. shouldn’t stop it.

The drawbacks of the federal government’s heavy presence in the District aren’t lost on the mayor. Four days before submitting the Poplar Point proposal, Gray told a gathering of businesspeople, “We have been a company town for decades, and we can’t afford to do that anymore.” Sequestration, he said, has revealed the vulnerability brought about by excessive economic dependence on the federal government. Nevertheless, his administration is endorsing a plan to concede a promising strip of riverfront land that could otherwise host amenity-rich development to, well, dependence on the federal government.

Despite his pitch, Gray appears to be less than fully committed to the idea of retaining the FBI in the District. In a conversation last week, though Gray insisted that “we’re going to do what we can to keep the FBI in the District of Columbia,” he acknowledged that an FBI headquarters at Poplar Point would present the same opportunity costs as the current Pennsylvania Avenue building, in terms of both community amenities and hard cash.

“We don’t get anything on property taxes,” Gray said of an FBI headquarters in the District, given that the federal government doesn’t pay property taxes on D.C. land it occupies. “We don’t get much on income taxes. Sales taxes, I don’t know where these people eat.”

There’s widespread speculation that the mayor’s feelings toward an FBI relocation within the District are lukewarm at best. “A lot of us feel the mayor thinks they’ve got to say they’re interested, but it’s not the highest priority they’ve got,” says a source who has worked on GSA projects before and asked not to be named due to his involvement in the FBI discussions.

Let’s hope he’s right. An FBI move to one of several suburban jurisdictions that have been pushing hard to attract the agency would be billed as a loss for the District. But consider what the city would really be losing: an untaxable property with high security requirements that largely shut it off from the surrounding community and which blocks out other potential development.

“I think that there’s some type of presumptive nostalgia, or some idea that it is a loss to lose something as prestigious and familiar as the FBI,” says Ward 6 Councilmember Tommy Wells. “But I don’t think it’s a good economic equation, and it doesn’t bring any new amenity to District residents.”

As Wells points out, there are two factors at play here. The first is raw numbers. If the city is able to choose between mixed-use development and an FBI headquarters at a site like Poplar Point, it’s a no-brainer. (The Office of the Chief Financial Officer is only now undertaking a fiscal impact study, though the administration conducted a broader survey of relocation options that it has declined to make public.)

“As the District grows, since we cannot get commuter taxes and payroll taxes, we have to focus on our four-legged table, which is property taxes, income taxes, sales taxes, and business taxes,” says Wells. “And the only thing we get from the FBI in that formula is probably some sales taxes and some income taxes, although we don’t know how many that work for the FBI live in the District.”

The second factor is neighborhood development. Poplar Point is a short walk from the Anacostia Metro station and from Historic Anacostia, a neighborhood with a pedestrian-friendly layout but a dearth of the kind of dining and retail options that could provide a needed economic boost to the area. Although the FBI headquarters could theoretically incorporate a degree of retail, it would necessarily be somewhat isolated from the community, given the substantial required setbacks from the street required for Level V security buildings.

GSA is hoping to put the new headquarters somewhere with Metro access to alleviate traffic concerns. That’s a worthy goal, provided it doesn’t crowd out true transit-oriented development with a gated compound that many employees will drive to anyway. Cheryl Cort, policy director of the Coalition for Smarter Growth, sees the lowest opportunity cost at the Greenbelt Metro station in Prince George’s County, since environmental constraints due to the area’s floodplains and wetlands make other development difficult.

Of course, development at Poplar Point is no slam dunk. In 2008, Clark Realty Capital was awarded the right to build a mixed-use community there including restaurants, housing, offices, a park, and possibly a soccer stadium. A year later, with the real estate market tanking, Clark backed out, and there’s been little movement on Poplar Point since.

Some people claim that the FBI will help stimulate development at Poplar Point that’s otherwise not forthcoming. “The argument is no one will develop Poplar Point unless there’s some sort of anchor there,” says Gray spokesman Pedro Ribeiro.

But the mayor says he’s “confident” that development will occur at Poplar Point with or without the FBI and that he met with an interested developer last week. Wells argues that with so many large tracts of public land being developed right now, it’s unreasonable to expect Poplar Point to move quickly, but development will occur before too long. “The amount of development going on in the city is almost unprecedented, so for anyone to say, ‘Oh no, why can’t we get Poplar Point developed right now?’ kind of defies logic,” Wells says.

Another argument in favor of retaining the FBI is fear of a slippery slope whereby the District would keep forfeiting federal government operations in order to develop taxable properties. But not all federal agencies are alike. Few people would claim that the Pentagon should be located within District limits. Agencies with lower security requirements, on the other hand, can help bring neighborhoods to life: Just look at the U.S. Department of Transportation headquarters that’s spurred the growth of the Capitol Riverfront area.

Of course, Gray doesn’t want to be seen as willingly handing over federal agencies to the suburbs. That may be why he’s bidding to hold onto the FBI even if he’s uncertain about the financial and community benefits of such a move. But there’s no shame in admitting that certain operations make sense in an urban environment while others just don’t. The FBI pretty clearly falls into the latter category.

“You’re taking a huge chunk of real estate off the market, and you’re taking it off the tax rolls,” says Ribeiro of an FBI move to Poplar Point. “So the question is: Does the financial benefit of keeping the FBI here compensate for taking such a large piece of property off the tax rolls?”

If the administration’s answer is no, as it ought to be, then it should just drop the charade and say so.

Photo by Darrow Montgomery