The Palm Motel on Pico Boulevard. (photo by Daniel Archuleta)

14TH STREET — The owner of the Palm Motel has agreed to pay $7,500 to City Hall’s Consumer Protection Fund and give free rent to three of his current and former guests as part of a settlement reached with the City Attorney’s Office, it was announced Wednesday.

Spiros Dellaportas was accused of taxing guests at the hotel over a period of several years, taxes which were not legally owed nor forwarded to City Hall, said Adam Radinsky, head of City Hall’s Consumer Protection Unit.

By law, hotels can collect transient occupancy taxes (TOT) from guests only for the first 29 days of their visit.

Those staying at the motel, located at 2020 14th St., complained that they were charged illegal taxes and that managers at the motel harassed them.

As part of the settlement, Dellaportas will also have to complete a two-day property management training program, meet with the City Attorney’s Office to discuss the issues of the case and keep thorough and accurate records of all guests who stay in the future.

Dellaportas did not admit any wrongdoing as part of the settlement.

In a statement from his attorney, Dellaportas, a long-time Santa Monica resident, said the allegations made were untruthful and “asserted for personal gain.”

“Although Mr. Dellaportas disagrees with the city’s allegations, he elected to work cooperatively with the City Attorney’s Office in order to reach an amicable resolution,” the statement reads. “Even though he is confident he would have prevailed in any legal action commenced by the city, settlement was more prudent from a business standpoint than protracted and expensive litigation.”

Along with the statement, Dellaportas’ attorney included letters of support from the Upward Bound House and OPCC — two nonprofits in Santa Monica that provide assistance to homeless families and individuals — praising him for offering his rooms to those in need at affordable rates.

“The owner provides good service and works collaboratively with us to provide quality rooms to our families,” said David Snow, executive director of the Upward Bound House.

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