County votes to no longer let 49ers manage Levi’s

The action won’t affect the team’s operation of the stadium until a lawsuit is resolved

In the latest salvo in a contentious relationship, the Santa Clara City Council unanimously has decided to end an agreement allowing the San Francisco 49ers to operate Levi’s Stadium for home games and other National Football League events.

The council’s action, done in closed session, does not immediately affect the 49ers oversight of the stadium because the city and team are locked in litigation. The 49ers sued the city in September to block it from trying to strip the team of its authority to manage nonfootball events at Levi’s and is awaiting a judge’s ruling.

City Attorney Brian Doyle said the city recently received additional information showing fraud, misappropriation and willful misconduct by the 49ers, which gave it grounds to terminate the contract.

In a court declaration Feb. 10, Doyle accused Al Guido, president of the 49ers Stadium Management Co., of conflicts of interest in approving a sponsorship agreement for a college football event at Levi’s, the Redbox Bowl.

According to Doyle, the city received only $1 million of the $1.8 million in payments over two years from

Redbox Bowl proceeds that went to city’s Stadium Authority. The city is entitled to receive a cut of revenue from non-nfl entertainment events at Levi’s.

Doyle said the total amount originally was redacted from the contract, and the 49ers’ lawyer later told him the remaining $800,000 was transferred to the team as payment for NFL signage, which violated laws prohibiting officials from signing public contracts that might benefit themselves financially.

Doyle’s declaration also said the team has not shared full financial documentation for a number of contracts in which it did not pay prevailing wages.

Rahul Chandhok, vice president of public affairs and strategic communications for the 49ers, said the City Council’s vote clearly is “an act of retaliation after it became public that the 49ers would join civil rights leaders to defeat Measure C.”

The 49ers recently poured more than $300,000 into a campaign committee to oppose Measure C, a ballot measure pushed by Santa Clara’s mayor and council majority to change the city’s court-ordered district elections system.

“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,” Chandhok said in a statement.

Doyle called Chandhok’s accusation “ridiculous.”

“None of that has anything to do with Measure C,” Doyle said.

In September, the City Council sent a letter to Guido declaring it’s ending the team’s management agreement effective Nov. 15, citing mismanagement of the stadium, possible conflicts of interest and a floor-polishing contract for which the team failed to get proper city approval and stiffed workers out of more than $85,000 by not paying prevailing wages.

That action would not have affected the team’s home games or other National Football League activities.

The team almost immediately filed a lawsuit disputing the city’s action.

With the vote, the city now will be seeking to kill the whole agreement and strip the 49ers of all management and operation responsibilities for Levi’s Stadium, including its own football games. The city eventually wants to hire a third party to manage the stadium.

The city has also revoked the 49ers’ authority to spend on stadium operations and maintenance without first getting City Council approval.