The administrative region with the nation's capital in it gets preferential treatment, pretty much universally across countries and times. DC sort of gets the opposite treatment, though, which is good from that perspective but sort of sucks for the people living there, since they have limited autonomy. So I'd posit that DC, the territory, should have no residents besides the President himself; the only way I get that without forcing seven hundred thousand people to move is to change ownership of the land to some state that wants it.