19 Relocated for MTA Tunneling Cost $343,516

The Metropolitan Transportation Authority and its insurance company have spent $343,516 in temporary relocation costs, including hotel rooms and meals, for 19 Hollywood residents displaced during subway construction, officials said Monday.

That amount includes more than $100,000 spent for rooms and meals for two people housed at the Hollywood Palm Hotel for 17 months. The MTA recently cut off payments for the two, although a third man, who is disabled, still lives in the hotel.

MTA Chairman Larry Zarian acknowledged Monday that the agency should never have spent what it did. “Somebody dropped the ball,” he said.

MTA spokeswoman Andrea Greene added that the agency was under no obligation to pay the relocation costs but did so because “we were trying to be a good neighbor.”

The 19 residents were living at the Hillview Apartments, which was evacuated in August 1994 after the ground sank as much as 10 inches above the tunneling under Hollywood Boulevard. Although the MTA has contended that the building was damaged by the January 1994 Northridge earthquake, the agency agreed to the payments in the hope of settling lawsuits filed by tenants.

News of the expenditures came to light earlier this month when the MTA cut off payments for Henry Lee, who had run up $52,929.52 in hotel bills, meal costs and telephone charges. Lee blames the tunneling for damage to his Hollywood Boulevard key shop.

MTA officials said Monday that they are negotiating with their insurer, Argonaut Insurance Co., over how much the transit agency will have to pay. So far, the insurance company has paid the bulk of the costs.

Argonaut, citing the MTA’s legal problems and “the public’s dissatisfaction with the construction,” recently announced that it is canceling the agency’s insurance, effective June 30.

“We’re not sure how much we’re going to have to pay,” Greene said. MTA officials, citing the negotiations, refused to make available a breakdown of the expenditures.

While the costs seem high, some of the residents say the MTA didn’t do enough.

Tim Shumaker, who lived at the Hollywood Palm for more than a year, said his free stay was anything but a vacation.

Shumaker, the blind owner of a talent agency, said he had to crowd into a one-bedroom hotel room with his wife, baby and guide dog (the Labrador slept in the bathtub). He said he finally moved out after the baby crawled onto the seventh-floor balcony. “It was getting unbearable,” he said.

Shumaker, who moved into another apartment with financial help from his attorney, is the lead plaintiff in a lawsuit against the MTA signed by 1,300 property owners along the subway route.

“Had they used common sense, they could have put each one of these people in a hotel for one month and paid them the relocation money they’re entitled to. . . . They would have saved hundreds of thousands of dollars,” said Jerry Schneiderman, chairman of Hollywood Damage Control and Recovery.

Said Greene: “You’re damned if you do and damned if you don’t.”