IN MID-SEPTEMBER a decision is due from the District's State Health Planning and Development Agency on whether to approve construction of a $47 million rehabilitation hospital in the city. The new hospital, which would be built on the site of the old Children's Hospital, is advertised by its developers as bringing $1.25 million in tax money here, as well as 1,200 jobs, mostly for unskilled workers. This sort of addition to the local economy is not a trifle. The decision on whether to build the hospital, however, should be based on the need for such a rehabilitative facility in this area, and the chances for its economic survival; if it were to be built and to fail, it would put a large new burden on the city government.

Any argument in favor of building the hospital starts with the State Health Plan for the District, which says the city needs as many as 690 beds for rehabilitative care. A committee of the Statewide Health Coordinating Council, an advisory group to the city, urged that the new hospital be built with 320 beds. But in July, the health council voted down the proposal to build even a 320-bed hospital and suggested that the facility be built on a smaller scale. That vote was a result of research that found that while the health plan may call for as many as 690 beds, there is an actual demand for only 120 beds and a prospective need for maybe 40 more.

Developers of the hospital, including Jeffrey Cohen, a close political ally of Mayor Barry, have cut back the size of the hospital since their initial proposal was voted down. The hospital they propose to build would have only 240 beds. But that is still far larger than what the research indicates would be the demand for a rehabilitative hospital in this area. In fact, the research found that, if it were not for the possibility that patients from outside the area might use the Washington hospital, only 97 beds would be needed to meet the estimated local demand.

Nevertheless, developers of the hospital have asked the State Health Planning and Development Agency to approve a 240-bed facility. Mayor Barry and the city council have given their approval to the project by signing an application for an $8 million grant. The grant would help pay for the construction costs. "The Shaw Project Area Committee, a community group that sees hope for that part of the city in the jobs and possible development that could follow the hospital, has also given its support to the project. There seems to be a swell of pressure to approve it.

The State Health Planning and Development Agency would do well in this case to err on the side of caution. While everyone wants tax dollars and blue-collar jobs for the city, there are too many signals that developers want a facility larger than it would be possible to support without subsidies from the city. And it must be remembered that this area is in no way short of hospitals. Though there may be a small shortage of rehabilitative hospital beds, it is entirely possible that in the near future underutilized hospitals in the area could be remodeled to take care of the need.