Controversy over the $74 million rebuilding of the Sheraton Park Hotel has largely dissipated because of successful negotiations between members of the community and hotel officials, William Carroll, president of the Woodley Park Community Association, said last week.

Carroll told approximately 100 members of his association that a group of community leaders has narrowed a list of local concerns from 62 to eight in negotiations with the hotel - but that the major problems of parking and traffic remain unsettled.

The Sheraton Park, a 59-year-old landmark on Connecticut Avenue, met strong opposition from the Woodley park neighborhood when it announced an expansion plan three years ago. A modified plan announced late last year appeared to be more acceptable, but still controversial. The community-hotel negotiations ensued, the results of which Carroll called largely succesful.

Under the expansion plan, the hotel will build a modern 10-story hotel section, demolish the oldest part of the complex, and almost double exhibit and convention space. The initial demolition will be completed next month, and construction of the new building is to begin in August.

No expansion of parking facilities is planned, however. Hotel officials say they expect to attract a wealthier clentele who will come to Washington by air, take taxis around the city, and thus need less parking.

Willie Armstrong, resident manager of the hotel, assured Woodley Park residents that the hotel expansion would mean fewer guests at the hotel who come on bus tours and by private automobile.

He told the citizens that they would not be bothered by as many bus tours after the expansion, because many tourists who have stayed at the Sheraton Park in the past won't be able to afford the new sections. "We don't feel that that type of clientele will be able to survive or pay what we'll be offering at the time we complete the hotel," he said.

Four community groups have been involved in the talks with the hotel: the Woodley Park association, the Cleveland Park Citizen's Association, the St. Thomas Apostle Parish Council and Advisory Neighborhood Commission 3C.

As examples of the group's success, Carroll said suggestions about landscaping part of the hotel grounds, installing lights in the hotel garage, and studying parking in the neighborhood were readily accepted by the hotel. The hotel hired a consultant for a traffic and parking study.

Carroll said the neighborhood's biggest concern with the Sheraton Park's new expansion was the great increase in convention and exhibit space, because local conventions and exhibits generate the most traffic. But he said the hotel has agreed to cut back on convention space somewhat.

Armstrong, while acknowleging that local affairs held at the hotel generate "tremendous traffic," said the hotel would continue to hold them, noting. "Once every four years we will have an inaugural." But he said the Zoological Gardens Metro stop, scheduled to open in 1981, would heop relieve traffic somewhat.

Armstrong also told Woodley Park residents that the hotel's current garage is underutilized making it unprofitable for the hotel to expand it.

While many of the citizens seemed skeptiical about underutilization of the garage, and urged measures to increase its use, the group seemed generally satisfied with the results of the hotel-community talks.

"You're not going to throw eggs at me?" Armstrong joked as he began his address to Woodley Park residents last week. The audience answered with applause.

Carroll emphasized that the Woodley Park community has never opposed the general outlines of the hotel's current expansion plan - though it did oppose an older plan which called for building a modern glass-and-steel structure on Connecticut Avenue.

The hotel's current plans will preserve the historic parts of the hotel - including the Wardman Towers, named after Henry Wardman, the noted Washington builder who erected the first part of the hotel in 1918. The new luxury hotel rooms are to be built in character with the Woodley's Park neighborhood.

In other discussion at the Woodley Park meeting, a number of citizens complained about heavy truck traffic in the area of Metro construction for the Zoological Gardens and Cleveland Park stations. Jack Hartley, assistant D.C. director of transportation, warned that the problem would be with them for the next two to three years.