The plan was to beautify the city park, add some bushes here and some grass there, to create a quiet place to read a book.

Neighbors of the two-acre park in the Kalorama neighborhood formed the Friends of Mitchell Park Inc. two years ago and negotiated an agreement with the District government, raised money to pay for a master plan and selected a landscape architect.

"We were all ready, and then the architect said, 'But what about this archaeological site that's listed on the National Register of Historic Places?' " said the group's president, Holly Sukenik. "We said, 'What archaeological site?' "

The one that sits square in the middle of their neighborhood park at 23rd and S streets NW, where the foundations remain of an early Washington farmhouse built at the same time the White House and the Capitol were under construction. Although the house was demolished 70 years ago, the subterranean remains can not be disturbed.

The Friends of Mitchell Park were told they couldn't even plant grass without clearance by the city's historic preservation office.

"But we just want to landscape our park," Sukenik said she told Nancy Kassner, an archaeologist in the historic preservation office. "She steered us to a grant program that would cover most of the costs of having the site excavated."

Once the foundation walls are found and documented--and covered again with earth--the group can plan its landscaping around the historic site, Sukenik said.

Yesterday, Kassner peered into the three excavation sites and talked with the archaeologists conducting the dig.

"This is truly a unique site," Kassner said. "We don't know much about the early District."

When the Friends of Mitchell Park began the project, no one in the neighborhood seemed to remember the discovery of the foundations in 1980, when the Recreation Department contemplated a project at the park, which was then dropped, or the listing of the site in the register in 1995. No sign or plaque was erected in the park, where in 1795 Anthony Holmead II built his two-story brick house with a view of the new city of Washington, D.C., and the Potomac River beyond.

During the Civil War, Holmead's great-granddaughter Sophia Speake Kall was evicted from the house when the Union Army seized it for a small pox hospital. During a Christmas party in 1865, the hospital patients accidentally set the house on fire during dinner. Kall rebuilt the house and lived there until 1894, when she sold it to Thomas Davidson, who subdivided the 15-acre estate.

Ten years later, the German empire bought the house to use as their embassy, but the U.S. government seized it during World War I. The Germans repurchased the property in 1922 and demolished the house. But before they could build their new embassy, World War II began, and the United States again seized the property.

After the war, the property was given to the city as a park, to expand an adjoining Department of Recreation play area to the west.

About 10 years ago, neighbors with dogs and those with children feuded over who had the right to use the park. It was resolved by reserving the western side as a play area and giving the eastern side--the Holmead property--over to the neighborhood dogs.

Phillip Hill, the lead archaeologist at the site, said he expected that the work would be finished in about 10 days. Then archaeologists will take the bits of brick, pottery shards and pipe stems back to the laboratory for analysis.

The Friends of Mitchell Park expect to have their master plan ready by spring, raise an estimated $250,000 to pay for the work and see everything planted by November 2000.

CAPTION: Phillip Hill, the lead archaeologist for the dig at Mitchell Park, watches field technician Brandon Grodnitzky take measurements. The Northwest park is the site of an early Washington farmhouse.