And that's the issue. Currently, DC is Federal property. If DC becomes a state, then it has sovereignty over its territory, and so what of the Federal property? Or is DC to become a state with no territory?
Not all property in DC is government owned. It’s just subject to DC jurisdiction, just as VA property is subject to VA jurisdiction. Federal property cannot be taxed in any state.
Actually now that I think of it that is yet another reason justifying my proposal. You are correct that if the federal government owns a lot of property then the state will have trouble raising taxes. So expand the size of the state to give it some additional land that can be taxed.