Brian Flahaven

This morning, I testified on behalf of ANC 6B at the DC Council’s Committee on Economic Development oversight hearing for the Deputy Mayor for Planning and Economic Development (DMPED). My testimony, posted below, focused on the status of development plans at the Hill East Waterfront/Reservation 13.

Good morning Madame Chair and members of the Committee on Economic Development. My name is Brian Flahaven, and I serve as chair of Advisory Neighborhood Commission 6B. My single member district, 6B09, lies in Hill East and includes Barney Circle, the Historic Congressional Cemetery, and the Eastern Branch Boys & Girls Club Building.

I’m here today to testify about the Hill East Development, also known as Reservation 13, the 67-acre former site of DC General Hospital. I’m testifying on behalf of ANC 6B, which approved my testimony 4-0 during a Feb. 26 Executive Committee meeting.

Eleven years ago, this Council approved a master development plan for Reservation 13. The plan, created with substantial community input, envisioned a mixed-use development that would finally connect surrounding neighborhoods to the Anacostia River waterfront. The plan recognized the site’s many advantages – waterfront location, access to Metro and close proximity to two wards – and it envisioned bringing housing, retail and office space to an area of the city in desperate need of all three.

In 2008, the Fenty Administration issued a request for proposals seeking a master developer for Reservation 13. Four development teams responded to the request, and ANC 6B and the surrounding neighbors heard presentations and weighed in on each request. In 2010, citing the economic downturn, the Fenty Administration issued a scaled back request to the four development teams, asking each to submit plans to develop the two parcels closest to the Stadium-Armory metro plaza. Two of the four teams submitted responses to the scaled back request.

The city sat on the two responses until early 2012, when the city attempted to convince the Washington Redskins to build a training facility on the site – an attempt that drew loud opposition from the community. At the time, the city was ready to give away this valuable piece of real estate for nothing, and while the Mayor made it clear the Redskins would have to pay for the facility, he also indicated that the city would cover the cost of infrastructure improvements.

Once it was clear that the training facility was not going to happen, Mayor Gray announced in March 2012 that DMPED would move forward with mixed-use development plans. We applauded the Mayor’s announcement and were eager for DMPED to select a development team. Unfortunately, instead of choosing one of the two responses on the table, DMPED chose to begin the process again and issued a new RFEI in Oct. 2012 with responses due in January. At the deadline, only one development team – Donatelli/Blue Skye – submitted a response to the RFEI. While we are pleased that Donatelli/Blue Skye submitted a response, we are extremely disappointed that additional development teams decided not to participate.

Why did DMPED only receive one response? ANC 6B believes there are four explanations:

First, in their revised RFEI, DMPED removed language that gave the winning development team the right of first refusal to negotiate with the city to develop the rest of the site. This was a huge incentive for developers to bid on the scaled-back project and also demonstrated a commitment by the city to eventually develop the entire site.

Second, the RFEI required development teams to pay for all infrastructure improvements, including the construction of public roadways. Unlike the Redskins training facility, the city was unwilling to make the same infrastructure commitment to a project that is a much better use of the site – one that will provide new tax revenue, jobs and housing. The Mayor has budgeted infrastructure funds for other development projects, such as Walter Reed and St. Elizabeth’s. Why is he not willing to do so for Hill East?

Third, the city does not have a plan for closing DC General and relocating any of the services located on the site. Though initially planned to be temporary, the city has continued to expand the DC General homeless shelter. The shelter now houses around 1,000 homeless individuals in a deteriorating building separated from the rest of neighborhood. In addition, the city operates a methadone and other clinics at the site, which already includes the DC Jail. Without a plan, the development community remains skeptical that the city is committed to closing DC General and developing Reservation 13.

Fourth, the city’s on again, off again strategy on the site has made it an inherently risky opportunity in the eyes of the development community. Development teams are reluctant to spend investment dollars on competitions with no winner.

To help this important project proceed forward, we urge the committee to ask DMPED the following questions:

1. How does DMPED plan to proceed with the Donatelli-Blue Skye response? Do they plan to share the response with ANC 6B, ANC 7F and the surrounding community? Can they proceed with one response?
2. Given the lack of responses to the RFEI, does DMPED and Mayor Gray plan to seek funding in the FY14 budget for infrastructure improvements at Reservation 13?
3. How is DMPED working with the Deputy Mayor for Health and Human Services and the Department of Human Services on a plan for eventual closure of DC General?
4. What does DMPED plan to do to demonstrate to the development community that the city is serious about developing the Hill East waterfront?

After years of distractions, three RFPs and numerous delays, the city has lost credibility on this project in the eyes of both the development community and surrounding neighbors. However, ANC 6B and Hill East residents are committed to working with the Mayor, DMPED and our Ward 7 colleagues to finally get this project across the finish line. We see Reservation 13 not only for its potential to bring new jobs, housing and retail options to our neighborhoods, but also as a way to strengthen the connection between residents on both sides of the river. 

Thank you for your time, and I’d be happy to answer any questions.

Yesterday, the Deputy Mayor for Planning and Economic Development’s office (DMPED) announced that only one development team submitted a response to the Request for Expressions of Interest to develop parcels F1 & G1 of the Hill East/Reservation 13 project. As reported by Jonathan O’Connell of the Washington Post, the sole response was submitted by the team of Donatelli Development and Blue Skye Development. Some previous bidders, including William C. Smith & Co, decided not to bid this time around.

To say that I’m disappointed is an understatement. In making the decision to start from scratch and rebid the site, the city argued that the recovering market would translate into more development teams bidding on the site (they also referenced a shaky legal argument). Now, instead of choosing between two responses from teams who had submitted plans for the entire site back in 2008,  the city and neighborhood now have only one option to evaluate.

Here are my best guesses as to why the city only received one response:

• Removal of “right of first refusal” language. In their revised RFEI, DMPED removed language that gave the development team that won the right to develop parcels F1 & G1 the right  of first refusal to develop the rest of the site. The right of first refusal was a huge incentive for developers to bid on the scaled-back project and also demonstrated a commitment by the city to eventually develop the entire site. 
• No money for infrastructure. The RFEI required development teams to pay for all infrastructure improvements, including the construction of public roadways. Back when Mayor Gray, Councilmember Jack Evans and former Councilmember Michael Brown were trying to lure the Redskins to build a training facility on the site, they said that while the city would not cover the cost of building the  facility, the city would cover the cost of infrastructure. Unfortunately, the city is  unwilling to make the same commitment to a project that is a much better use of the site – one that will provide new tax revenue, jobs and housing. The Mayor has budgeted infrastructure funds for other development projects, such as St. Elizabeth’s. Why is he not willing to do so for Hill East?
• No plan for social services.  This is probably the main reason that developers remain skeptical about Reservation 13. The city does not have a plan for relocating any of the services located on the 67-acre site. I plan on continuing to urge the city to come up with a concrete and comprehensive relocation plan – one that will provide some certainty to the neighborhood and development community.

I am appreciative that Donatelli and Blue Skye submitted a response and I’m eager to learn more about their plans. Donatelli was a partner in one of the top two bids in 2008.  But as I argued last year, the city should have selected one of the two scaled-back responses submitted in 2010. Instead, the city wasted another year re-bidding the project with a worse result.

Around 25-30 residents attended last night’s ANC 6B Hill East Task Force meeting at St. Coletta of Greater Washington. The main topic of discussion was the status of the Request for Expressions of Interest for Parcels F1 & G1 on Reservation 13. Ketan Gada from the Deputy Mayor for Planning & Economic Development’s (DMPED) office provided the task force with an update on the RFEI and answered a number of great questions. Here are the highlights:

• Gada outlined key aspects of the RFEI – the response deadline (Jan. 7, 2013), response requirements and DMPED’s timeline. He noted that the RFEI requires developers to submit two proposals – one that complies with the full affordable housing requirements on the site (30 percent) and an alternative proposal with the number of affordable housing units the development team feels can be supported on the site without government subsidy (minimum of 13 percent). DMPED’s handout (pdf) and my Oct. 22 post provide additional details on the RFEI.
• DMPED plans to review all proposals received on Jan. 7, eliminate any non-responsive proposals from consideration and ask development teams to present their plans to ANC 6B and ANC 7F in February. After receiving ANC and community feedback, DMPED will either select a winning development team or narrow the list and ask finalists to submit Best and Final Offers. DMPED’s goal is to select a development team by spring 2013.
• Gada said that DMPED anticipates receiving 3-5 proposals from development teams. When evaluating proposals, DMPED will consider past experience with the development team, compliance with applicable laws, community feedback, green building requirements and any requests for government subsidy. Not surprisingly, DMPED prefers development proposals that do not seek District subsidy or funds.
• The District is offering Parcels F1 & G1 “as is,” which means that the winning development team will be responsible for infrastructure requirements, including partial street extensions of Massachusetts Ave. SE, Burke Street SE, C Street SE and the full build out of the “Village Square” around the Stadium-Armory Metro plaza. Gada said the street extensions would be public streets and that the District Department of Transportation (DDOT) does not have funding to complete full extensions of the street at this time. I expect the District will have to fund some of the  Massachusetts Avenue SE extension since it would be the main point of access to the DC Jail.
• Besides funding, Gada said the National Park Service’s ownership of the Anacostia waterfront land may also prevent construction of the full Mass Ave. extension in the near future. The “Monument Circle” envisioned as the termination point of Mass Ave would actually be located on NPS land, and NPS has been unwilling to sell or lease the land to DC. Monument Circle is the only portion of NPS land that is “touched” in the master plan – the rest would continue to be green space. However, DDOT has proposed constructing “Park Drive,” a roadway that would connect Independence Ave, the newly constructed Monument Circle and a newly reconstructed Barney Circle. This proposed roadway is a really bad idea, particularly since it would block Reservation 13 and the neighborhood from the waterfront.  In any event, NPS still needs to be convinced that leasing or selling the their waterfront land to DC is a good idea.
• The task force and attendees raised concerns about the piecemeal nature of the development and whether DMPED or anyone in DC Government would provide appropriate oversight to ensure that the full vision of the master plan is realized. Gada said that compliance with master plan is required in the RFEI and that development teams would have to comply with the form-based zoning and design guidelines approved for the site. Ultimately, the ANC and the surrounding neighborhood will have to play an active role in ensuring that DC government, DMPED and the development teams are following the master plan.
• Once construction at F1 & G1 is underway, Gada said that DMPED plans to issue RFEIs for parcels along the proposed Mass Ave. extension and then move north towards Independence Avenue. Of course, further RFEIs would be contingent on DC government relocating a number of the shelters, services and clinics currently operating at DC General. Gada said that DMPED is talking with the Department of General Services and other relevant agencies about relocating their services. Gada could not provide a definitive timeline for future RFEIs.
• When asked about the status of the deteriorating Anne Archbold Hall, the only building on the site that is a historic landmark, Gada said that the Department of General Services recently sent out an inspection team to determine what needs to be done to stabilize the building and prevent further damage. DGS plans to use available funding to repair the building’s roof and replace damaged windows.

Please post your comments, questions or anything I missed below.