Manhattanization

Dear DC Dwellers:

Megan McCardle, at the Daily Beast web site, frets about DC housing prices (http://tinyurl.com/8azgvzx). McCardle’s worry is the opposite of most homeowners. Most people hope to buy a house during a bad market, when the prices are low, and then enjoy a long period of good markets, when housing prices rise. But McCardle is worried that the house she bought a couple years ago is appreciating at a rapid rate. “Renovated homes on our block are selling for more than 150 percent of what we paid for our (less renovated home); even wrecks are going at a substantial premium. We’re glad to think that our house is worth more, of course, but we’re also mystified. It seems to me that there remains a distinctly bubbly mentality in the city, which you can [see] a bit of in this comment thread on a local blog [Prince of Petworth, http://tinyurl.com/9jayszg]. People seem to have a hidden assumption that every house in the District will eventually be crowding $1 million in value. This doesn’t seem possible to me. Ultimately, home prices have to have some relationship to incomes. And at a traditional salary-to-value ratio of two or three times income, I don’t see where the money would come from to push everyone’s house into the $800,000 range. (Nor, needless to say, would it be a good thing for society if this happened).”

She speculates about two possible reasons for the rise in housing prices. Over the past decade, income levels in DC have risen much faster than the national average. But she doesn’t foresee that trend continuing. Also, the desirability of living in central cities (at least some central cities) has risen relative to the desirability of living in suburbs, so that the affluent will concentrate in the centers of urban areas. She buys this thesis, “And yet, I can’t help but think that people in DC, who have not suffered through the bubble the way others did, are still somewhat caught in bubble mentality. People are buying houses for $650,000 on the assumption that they’ll soon be worth $850,000 — because that’s what happened on U Street. But there are still income limits, and the future appreciation is priced in. Maybe more than priced in.”

Is McCardle right? Doesn’t the price of housing have to bear some reasonable relationship to what people can afford to pay for housing? Or is the future of Washington housing what our “smart growth” urban planners hope — Manhattanization — where people give up their cars, give up their yards, and pay ever higher prices for ever smaller spaces?

Gary Imhoff
themail@dcwatch.com

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Fixing DC
Dorothy Brizill, dorothy@dcwatch.com

Last Thursday, the Washington Post hosted a community forum at the Post on “the state of DC leadership,” with a panel discussion on accountability, strategies for improvement, and challenges ahead for the District government. After the panel presentation, the forum closely resembled the daily ongoing discussions regarding the state of the District of Columbia that have been taking place in living rooms, offices, cabs, and the Metro all across the District and the region for the past year. The July 2012 Washington Post poll of one thousand DC residents served as the backdrop for the forum. The poll’s results showed 43 percent of DC residents believed the city was on the wrong track, 59 percent disapproved of Mayor Gray’s job performance, 44 percent believed corruption in DC government was getting worse, and 54 percent believed that Mayor Gray should resign.

Each of the panelists then offered his or her analysis of how to “fix DC government.” For Barbara Lang, president and CEO of the DC Chamber of Commerce, there is a need for elected leaders with greater integrity who are also “bold thinkers” with a good moral compass. In his remarks Kojo Nnamdi, WAMU radio host, complained about the District’s party primary system, which he said resulted in a one-party city that had a “structured old-boy network.” For former councilmember Carol Schwartz, the problem stemmed from a failure to hold government officials accountable and the need for a cadre of strong government watchdogs. Clinton Yates, local news editor at The Express, argued that District problems were compounded by a “culture of silence” by elected officials and business leaders, as well as by a generation of old Washington families who have corrupted the political process. Even forum moderation Robert McCartney, a Washington Post columnist, noted that things will not change in the District because DC residents are too forgiving and because there has not been enough outrage. For Carol Schwartz, the solution lay in the election of more women to the council, whereas Clinton Yates argued for a new generation of younger leaders to take the held in the District.

The Post forum also provided an interesting setting to weight the political fortunes and futures of two women in the District -- Ward Four Councilmember Muriel Bowser and former Peoples Council Betty Noel. Bowser, who is running for reelection to her Ward Four Council seat in November and who is contemplating a run for mayor in 2013 or 2014, arrived at the forum with a political entourage that included former Fenty campaign workers and political consultant Tom Lindenfeld. During the forum, she was not acknowledged, nor did she make any attempt to ask a question. As a result, most people in the room were oblivious to her presence until the meeting was over. On the other hand, Betty Noel, who had been the District’s consumer utility advocate when she served as the People’s Council, was probably the most popular person in the room. Because the Post forum occurred just twenty-four hours after the Public Service Commission had approved a substantial rate increase for Pepco approached her an expressed their disappointment that she had not been approved by the city council to become a member of the PSC last spring. More importantly, a sizable group of individuals tried to impress on Noel the fact that her professional skills and integrity are sorely needed in the District government, and pointedly asked her if she would consider running for elected office in the near future.

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Fixing DC Acquisition
Jason Bakke, jlb@chiefimpulse.com

Government contracting is complicated, governed by law, regulations, and case law, and performed under the oversight of auditors, competitors, and the public. Still, the field of contracting, which should be among the most highly respected in all of government, has taken a hit, as the perception among many has become that it is mostly clerical.

What function in government could be more important than ensuring taxpayer dollars are spent fairly and effectively?

I am not confident that contracting abuses will be remedied by the oversight of politicians, who are anxious to put their fingers on the scale. The solution to the problems uncovered in the City Paper is strengthening DC’s procurement function through training, better hiring, and more accountability. If the council can do that, without involving itself in the approval of individual contracts, it will have done its job.

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Washington Post Coverage
Randy Alan Weiss, rweiss@weissllp.com

I must take exception to your criticism and comment [themail, September 26] about the Washington Post regarding CBE’s (set asides and bonus points for local contracts). Your comment was: “Why has The Washington Post avoided the subject, and ceded the topic entirely to The Washington City Paper?” Obviously you did not read today’s (September 27} Post editorial page; there is an editorial on this subject. Nor have you followed the Post’s coverage on this subject for over one year. Don’t be too tough on the Post — they are expected to comment on Iran, Syria, Israel, Columbia rebels, Venezuela-Chavez crazies, Castro holding Alan Gross illegally, global warming, food shortages, etc. We are really lucky that the Post has the good sense to consider the local issues of importance (mayor/council/US Attorney, voting rights, taxes, ballpark, etc.). Show me any other internationally-recognized newspaper that devotes as much attention to local issues as the Post. You won’t find it. Long and short, I have found the Post editorial page team to be responsive, diligent, and surprisingly investigative! Investigative is something usually lacking on the editorial page.

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Pepco $24 Million Rate Increase
Ann Loikow, aloikow@verizon.net

On September 26, the Public Service Commission granted Pepco a rate increase of twenty-four million dollars. The increase relates to the very things that Pepco does very badly — i.e., maintain the distribution system — and to the installation of “smart meters,” which many people have opposed. If you have concerns about Pepco’s response to the derecho storm this summer, please consider testifying at the October 11 city council hearing on Pepco’s “storm performance.”

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CLASSIFIEDS — EVENTS

Dupont Circle House Tour Preview, October 21
Doug Rogers, info@dupont-circle.org

The countdown for the forty-fifth annual Dupont Circle House Tour has begun. This year’s Tour sites will be north of the Circle and will go east to west from Florida Avenue to 16th Street. We know you will be as excited as we are and we are looking forward to seeing you on Sunday, October 21.

House tour preview: Kurdistan Regional government US headquarters. This Victorian era brownstone designed by T.F. Schneider is now home to the Regional Government of Kurdistan. Meticulously restored with opulent interiors to match the original features, the RGK headquarters also houses a treasured collection of paintings, sculpture, and icons. Kurdish artwork juxtaposes great mirth and terrible suffering, much as the history of the region of its origin. The beautiful new Headquarters proudly takes its place among the ranks of local embassy brethren as an elegant and welcoming place of Kurdish civilization in support of its people, and for the edification and enrichment of the general population. We are honored to be able to offer it on the tour this year.

Tickets now available online. To learn more about this year’s tour, other fabulous homes and locations, advertisement and sponsorship opportunities, and ticket sales, please visit http://www.dupont-circle.org for more information.