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OFFICE OF VINCENT C.

GRAY
CHAIRMAN, COMMITTEE ON HEALTH
COUNCIL OF THE DISTRICT OF COLUMBIA

COUNCIL PERIOD 22
1. East End Health Care Desert, Retail Desert, and Food Desert Elimination Act of 2017
2. East End Grocery and Retail Incentive Program Tax Abatement Act of 2017.
3. East End Surplus Allocation Equitable Investment Act of 2017

These three bills work together in a coordinated strategy to invest in the East End of the District of Columbia by bringing a new
community hospital and grocery and retail anchor stores to Wards 7 and 8. The purpose of the legislative package is two-fold:
1) Create a funding mechanism for a new community hospital, an urgent care center, and an ambulatory care clinic that will
serve as an anchor and catalyst for creating a true health care system on the East End of the District of Columbia.
2) Identifying and funding construction of at least five sites in Wards 7 and 8 for large anchor stores that include affordably
priced groceries and retail goods.

The first piece of legislation is the East End Health Care Desert, Retail Desert, and Food Desert Elimination Act of 2017. The
purpose of this legislation is to eliminate the inequitable situation that results in much of Wards 7 and 8 being labelled as deserts
for health care, retail, and healthful groceries.

Title I of the bill requires that a new East End Medical Center be constructed on the St. Elizabeths East Campus. The hospital
would be accessible to both the Congress Heights Metro Station and Metrobus. The current United Medical Center (UMC) is
located in the center of its parcel making re-development difficult, and moving UMC from that site opens the entire parcel up for
re-development of mixed-income housing and retail that is located right on the Maryland border (thus encouraging the retail
leakage of Maryland consumer spending into D.C.). The bill also requires the construction of an urgent care center and an
ambulatory care clinic that will support the hospital. These healthcare facilities will be the anchors and catalyst for creating a true
health care system on the East End of the District, because they will attract doctors and medical specialists to Wards 7 and 8. The
District of Columbia is trying to get out of the business of running a hospital, but the status of the UMC physical plant makes it
impossible to attract a private operator to an oversized, half-century old building that will have tremendous deferred capital
maintenance need. A new community hospital will attract a world-class private operator.

Title II of the legislation establishes the East End Grocery and Retail Incentive Program in the Office of the Deputy Mayor for
Planning and Economic Development. The goal of this program is to bring large anchor stores to Wards 7 and 8 by doing
everything possible to make it financially attractive for anchor retail to open on the East End of the city by having the District
government pay for the construction of the stores. Anchor stores will allow residents of Wards 7 and 8 to have convenient access
to affordably priced groceries and retail goods and will serve as a catalyst for additional business development in neighborhood
retail corridors. The legislation identifies five sites in Wards 7 and 8 that are excellent locations for construction of new anchor
retail, including Skyland Town Center, Capitol Gateway, East River Park, St. Elizabeths East Campus, and the Current United
Medical Center site. A recent D.C. Policy Center report highlighted the dearth of healthy grocery options on the East End, showing
that more than three-quarters of all food desserts in D.C. are located in Wards 7 and 8. This situation is due to the fact that many
corporate decisions about where to locate anchor stores are based upon an Area Median Income (A.M.I.) calculation, and without
additional government incentives, Wards 7 and 8 will continue to be foreclosed from obtaining the grocery and retail amenities
that the vast majority of neighborhoods in the District currently enjoy.
Page 2 | CM Gray | March 21, 2017 | East End Health Care Desert, Retail Desert, & Food Desert Elimination Act of 2017 |
East End Grocery and Retail Incentive Program Tax Abatement Act of 2017 | East End Surplus Allocation Equitable Investment Act of 2017

The second piece of legislation is the East End Grocery and Retail Incentive Program Tax Abatement Act of 2017. In addition to
the District paying for the cost of store construction, this legislation provides further incentives through the D.C. tax code to make
it attractive for anchor stores to locate in Wards 7 and 8. The legislation exempts new anchor stores constructed on the five sites
from real property tax, personal property tax, deed recordation and transfer taxes, corporate franchise tax (combined reporting),
and sales tax.

The third and final piece of legislation is the East End Surplus Allocation Equitable Investment Act of 2017. This legislation
establishes the funding mechanism for the first bill. After the District of Columbia reaches 60 days cash-on-hand, 50% of
unassigned surplus funds at the close of the fiscal year are dedicated to pay-as-you-go capital. This legislation specifics that the
pay-as-you-go capital funding shall be dedicated to funding the new hospital and anchor retail in the East End Health Care
Desert, Retail Desert, and Food Desert Elimination Act of 2017. Due to the limitation of three introductions from the dais, this
bill will be filed in the Office of the Secretary.