Mayor Anthony A. Williams yesterday announced an agreement in principle to accept the $100 million offer from the Freedom Forum, the foundation that runs the Newseum, to move its headquarters and museum to downtown Washington.

The announcement came less than a month after the Freedom Forum's offer was made public. At the time, Williams promised to decide within 45 days whether to move forward. It took 27 calendar days.

"Whoever said government couldn't work quickly," Williams said. "I'm pleased to announce that the Newseum is moving to the news capital of the world, the place we call home, Washington, D.C."

The project calls for moving the popular Newseum from Rosslyn to Pennsylvania Avenue NW, where the foundation also is proposing to build 36,000 square feet of retail stores, 290,000 square feet of offices and 100 condominiums.

Under the agreement, the Freedom Forum would give the city $75 million for the property adjoining the Canadian Embassy at Pennsylvania and Sixth Street NW, where the D.C. Department of Employment Services is currently housed.

The District would receive an additional $25 million to build affordable housing. "This is a textbook partnership of local, federal and private leaders working together," said Charles L. Overby, chairman and chief executive of the Freedom Forum. "The mayor . . . has created a can-do environment. We want to thank them for cutting through the red tape."

Part of that red tape was getting the U.S. Labor Department to agree to the deal.

The department holds a 67.3 percent interest in the building, which it paid to build in 1961.

As part of the negotiations, Labor officials agreed to own a similar interest in the new facility that would be built for Employment Services instead of taking cash from the current deal.

District officials jumped at the Freedom Forum's offer because, they said, it was significantly higher than the $40 million to $50 million appraisals on the property, and serves three important goals: providing more downtown housing, creating permanent jobs for city residents and generating money to renew older communities.

Advocates for affordable housing have roundly celebrated the $25 million the District would receive for that purpose, but they don't want the money spent haphazardly.

"The expenditure of the money should be part of a comprehensive strategy to develop and maintain affordable housing throughout the District," said Nina Dastur, staff attorney for the Legal Aid Society of the District of Columbia.

Yesterday's announcement followed word last week that the city would receive a $30.8 million grant from the U.S. Department of Housing and Urban Development to replace run-down public housing with lower-density apartments and town houses.

Williams said the projects--one in downtown and the other in one of the city's poorest neighborhoods--are helping to restore confidence in the city. "This demonstrates the District's ability to attract major investments both downtown and in our neighborhoods," Williams said.

Many details remain to be worked out on the Newseum deal, including the formal signing of a contract by year's end. The D.C. Council still must agree to allow Williams to sell the facility and hammer out a sole-source contract with the Freedom Forum.

But officials in the Williams's administration and at the Freedom Forum were confident the details would be worked out. The Employment Services Department would be located elsewhere, but city leaders refused to disclose sites under consideration for fear of driving up the city's cost to purchase land.

Eric Price, deputy mayor for economic development, said the administration plans to send a resolution to the council next month seeking the authority to sell the property and make a deal with the Freedom Forum. The council does not approve the actual deal, only the mayor's authority to enter into one.

Council member Jack Evans (D-Ward 2) said the Newseum would bring life to the site because there will be activities day and night.

Even so, council member Kathy Patterson (D-Ward 3) said she's concerned that the council was not consulted earlier and that more proposals were not sought: " While it may sound like a good project, it is not necessarily a done deal. . . . They don't know what else is out there."