JERUSALEM - Israel pressed ahead Wednesday with a highway around Palestinian neighborhoods of Jerusalem, handing out eviction notices to Arab landowners even as negotiators for both sides resumed low-level contacts.
Palestinians pledged to stop the highway project, charging that Israel intends to confiscate more than 250 acres of Palestinian land, though Israel might end up handing parts to the Palestinians in peace negotiations now in progress.
Contacts between Israel and the Palestinians sputtered on with no progress reported, after Israel suspended the talks Tuesday and then quickly renewed them.
Hindering the talks is a dispute over control of holy sites in the Old City of Jerusalem. Palestinians complain Israel is blocking them from renovating Islamic holy sites there.
Israel has started giving eviction notices to Arab landowners to make room for a superhighway around the city, Jerusalem official Hagai Elias confirmed. He said compensation would be paid.
The project, called the ring road, is an Israeli plan to reduce congestion in Jerusalem, plagued by narrow streets and constant traffic jams. The road around the west side of the city, where Jews live, is mostly completed.
Building the ring around Jerusalem by encircling Palestinian neighborhoods is a political scheme, not a transportation plan, said Ziad Abu-Zayyad, a Palestinian Cabinet minister who deals with Jerusalem affairs.
The object is to ''make east Jerusalem an integral part of west Jerusalem,'' Abu-Zayyad told The Associated Press. He said the Palestinian Authority would take steps to force Israel to halt construction.
Israel annexed the Arab section of the city two weeks after capturing it in the 1967 Mideast war. Israel used to claim all of Jerusalem inside the expanded 1967 boundaries as its capital. However, in recent negotiations, Israel has offered the Palestinians control of Arab neighborhoods.
Meir Margalit, a member of the Jerusalem city council, said the road would allow Palestinians to drive from one section of the West Bank to another without going through Jerusalem, but Israel should have consulted the Palestinians about the plan. ''They did it the wrong way,'' he said. He suggested narrowing the road to reduce damage to Palestinian houses.
An Israeli official who did not want his name used said the road could be discussed in Israel-Palestinian negotiations.
Adnan Husseini, director of the Islamic Trust that runs the mosque compound, charged Wednesday that Israel is preventing the renovation of Islamic holy sites on the disputed hill. Israel has been stopping trucks with building materials from entering the compound, also the site of the biblical Jewish Temples.
The Israelis say the Muslims are destroying Jewish sites in their construction work on the disputed hill, known to Jews as the Temple Mount and to Muslims as Haram as-Sharif, the Noble Sanctuary. Both sides claim sovereignty there.
Palestinian negotiator Saeb Erekat met Wednesday with lawyer Gilead Sher, representing the Israeli side, after Israel canceled their meeting a day earlier. In a series of confused signals, Israel first said it was suspending the talks, then said the contacts were continuing.
Prime Minister Ehud Barak said there have been no real negotiations since Palestinian leader Yasser Arafat turned down American proposals at the failed Camp David summit in July. He said if Arafat agrees to discuss the ideas, negotiations will resume.