SANTA CLARA, Calif. (BCN/KTVU) - Members of the Santa Clara Stadium Authority voted Tuesday to end an agreement that allowed the San Francisco 49ers to manage Levi's Stadium, the team's home, for events other than of NFL events.
The authority said it ended the agreement because of alleged infractions that include certain misrepresentations to the authority, failing to pay prevailing wages and the failure to manage the stadium properly and maximize financial performance.
For example, members of the authority allege the team booked events that lost millions of dollars rather than events that make money such as soccer games, weekend concerts and corporate events.
Because of the poor management, the team is not in compliance with Measure J, the authority said Tuesday.
Measure J, which was approved in June 2010, gave Santa Clara officials the authority to look into developing a stadium for professional football and other events.
The stadium opened for the 2014 NFL season.
The 49ers Management Company issued this statement on Wednesday: "The 49ers Management Company will continue to manage Levi’s Stadium and attract the greatest events in the world to the Bay Area. The City’s latest announcement is just another step in a self-destructive process they began years ago as part of a petty political vendetta. All of those efforts failed, just as this latest attempt will also fail. The City’s legal case, such as it is, is in direct violation of the clear language of the relevant contracts. We are entirely confident that we will prevail in this dispute."
The 49ers Management Company has attracted the world’s highest-profile events to the Bay Area, the company continued, including Super Bowl 50, the College Football Playoff National Championship, the NHL Outdoor Stadium Series, Wrestlemania, Copa America, numerous concerts from the world’s biggest artists and "more major events than any other new stadium in its first five years."
These events brought hundreds of millions of dollars in positive economic impact to the region and increased Santa Clara’s sales tax and tourism base, the company said. As managers of Levi’s Stadium, the 49ers have generated over $22 million in profits to the authority, with $10.6 million going directly to the city’s general fund and an additional $9 million for the Stadium Authority’s Discretionary Fund, the company said.
The 49ers have had other disagreements with the authority, which is governed by the members of the Santa Clara City Council. In March the 49ers were issued a breach of contract by the city over a $643,568 bill for floor cleaning.
City officials allege the team did not provide documentation showing proper bidding and minimum wage practices in securing the contract for the flooring work.
Other disagreements between the two groups include the cost of renting the stadium, a curfew on events at the stadium and financial transparency.
The authority got a legal victory in August 2018 by forcing the team to pay $238,000 more in rent after the 49ers requested a reduction.
On Tuesday Rahul Chandhok, a spokesperson for the 49ers company blamed the canceled agreement on city manager Deanna Santana's "dysfunction ....and she has chosen to spiral even further. Her actions are purely retaliatory, and we are not surprised that she has commenced yet another legal battle. She is abdicating her fiduciary duty by destroying a city asset for petty, political vendettas."
KTVU's Sara Zendehnam and Ann Rubin contributed to this report.