(Written by DCist contributor Martin Austermuhle)

The Post reports today that President Bush’s proposed budget for 2006 includes funds to study the prospects of relocating the Coast Guard Headquarters, now located in Southwest, to the 300-acre St. Elizabeths Hospital in Southeast, as well as the possible construction of a federal bioterrorism and forensics lab on the 67-acre site of the former D.C. General Hospital. District officials expressed cautious optimism, noting that both could serve to attract businesses and to spur economic growth in areas long-left out of the city’s economic renaissance.

The plans for St. Elizabeths and D.C. General serve to highlight a longstanding love-hate relationship between the District and the federal government. While the federal government exercises control over large chunks of the city, thus denying city coffers much-needed revenues, it can also serve as a magnet for economic development. The new Department of Transportation headquarters, currently being built along M Street in Southwest and slated for completion in 2006 (right), will bring 5,500 employees on a daily basis to an area better known for its bleak industrial landscape. For much more information and photos on this project and others in Near Southeast and Southwest check out local website The Land of JD.