For years in many of the homes and businesses along a three-block stretch of Kennedy Street NW, most of the discussion about the drug problem has centered on ways of getting drugs out of the neighborhood.

Recently, a different sort of debate emerged as federal prosecutors announced they planned to drop hundreds of drug cases because of possible corruption among 4th District police vice officers.

On Kennedy Street, which has seen a drug market evolve from an open street bazaar to more clandestine sales in alleys and in nearby homes, opinion seemed about evenly divided over the prosecutors' decision, and whether the allegations of corruption are sufficient cause for alarm.

"It's nothing new. There's always been corruption in the police force, and I've been here 48 years," said Jesse Brown, a barber, community activist and local fixture at Eighth and Kennedy streets. "The problem is, they {4th District police} aren't doing their investigations. You have to know that if you go down to court and don't have the proof you need {to get a conviction}, they're going to throw your case out."

Franklyn Malone, chairman of Advisory Neighborhood Commission 4D, said it is too soon to tell whether police antidrug efforts in the area have been damaged.

"We are outraged at what happened, but we would also like to work with police officials and maintain the public integrity and try to get the situation in hand," said Malone, who is president of the local group Citizens Against Drugs on City Streets. "It's a messed-up situation, but maybe something good could come from it."

The controversy erupted Sept. 9 when it was revealed that federal prosecutors are investigating some 4th District police officers for allegedly skimming drugs and money during their enforcement activities. On Friday, it was learned that the investigation had broadened to include allegations that some officers may have falsified affidavits required to obtain search warrants in court. Police officials have decided to transfer all 16 members of the 4th District vice unit to other assignments.

While seemingly resigned to the possibility of police corruption, Malone and others expressed doubt that so many drug cases -- possibly 300 or more -- would have to be summarily dropped because of the allegations by police, as U.S. Attorney Joseph E. diGenova has said he will do.

DiGenova's decision has been sharply criticized by Mayor Marion Barry. And there was an undercurrent of feeling in the 4th District community that the chief prosecutor's decision has something to do with diGenova's continuing investigations into the Barry administration.

"I don't know what the legal basis is. But to decide not to try the cases {in court} is a terrible blow to the morale of the police department and to the officers who put their lives on the line to make those cases," said D.C. Council member Frank Smith Jr. (D-Ward 1), whose ward encompasses part of the 4th District.

"It sounds like the police department is being punished instead of these criminals who've been arrested," said Smith, who, like Malone, suggested that each case be examined on its merits, and not be dropped wholesale because of the police officers involved.

A close-knit community, the area along Kennedy Street near Georgia Avenue consists mainly of modest brick row houses and small businesses that give it a small-town flavor.

Many residents and shop owners in the area declined to be quoted by name, saying they feared retaliation by drug dealers or police.

One man who lives near Emery Recreation Center at Georgia Avenue at Madison Street NW, a local drug hot spot, according to Malone, said he fears problems will only grow worse if diGenova's decision stands.

"As far as I'm concerned, they're just giving the dealers a chance to do their business," said the man, who asked not to be identified. "You're going to have corruption wherever you go. But just because somebody did something wrong, why are you going to let all these dealers go? They had to have proof when they were caught, otherwise they wouldn't have made the arrest."

But the nearby owner of a variety store said he was reserving judgment, saying he suspected prosecutors know more than they are telling, and that more revelations might be in the offing. "Three or four officers is not enough to drop that many cases," this merchant said. "I just can't see the U.S. attorney dropping all those cases if there weren't something there."