SANTA CLARA (CBS SF) — Officials with the Santa Clara Stadium Authority this week made moves to collect on what it claims is at least $2.7 million the San Francisco 49ers owe in unpaid rent on Levi’s Stadium.
Officials stated on Thursday that the team refused to pay the full amount of monthly rent due after the NFL cancelled two preseason games, an assertion the 49ers dispute.
The team is set to play its home opener against the Arizona Cardinals on Sunday.
According to a press release issued by officials, the Santa Clara Stadium Authority Board voted unanimously during a closed session Tuesday to authorize a claim for arbitration against the 49ers due to unpaid facility rent for the amount that currently stands at $2.7 million.
Officials with the Stadium Authority say that in late July, the team notified Santa Clara that they were going to reduce the rent paid on the stadium by 20 percent based on what officials claim is a faulty interpretation of lease provisions regarding “untenantable conditions.”
Officials say the city notified the team that a rent reduction would not be allowed because the pre-season game cancellations were based on the NFL’s decision and not on any issue with Levi’s Stadium.
The Stadium Authority says that, despite being told that the lease did not allow for the rent reduction, lawyers for the 49ers insisted that rent would not be paid. Team lawyers have yet to provide any documentation to back that position.
Officials said the 49ers did not pay the September rent installment of $2,751,000. On Sept. 2, a default notice was sent in accordance with the provisions of the lease, which was followed by the unanimous vote on Tuesday by the Stadium Authority Board to take actions to recover the non-payment of rent.
The release additionally claims that the team’s representatives have made “untrue personal attacks against Santa Clara’s Mayor, City Manager, and City Attorney, while mischaracterizing the City’s actions.”
As of Thursday, officials said the rent has still not been paid.
The statement said that the stadium “lease requires that the parties meet and confer in an attempt to work out the matter before commencing formal confidential arbitration proceedings” and that they were hopeful the team would pay the rent due “rather than claiming political games in the media.”
The 49ers responded Thursday afternoon in a statement from Vice President of Public Affairs & Strategic Communications Rahul Chandhok.
“[Stadium Authority Counsel Brian] Doyle is, again, misrepresenting the facts in service of the City’s ongoing political agenda. The September rent payment will be paid in full, in accordance with the terms of the Lease. While the 49ers work to support the region’s economy, Mayor Gillmor continues a pattern of mismanagement that is costing the city critical revenue, hurting small businesses, and endangering local jobs,” said Chandhok.
The statement continued: “This is just another attempt to scapegoat the 49ers for her incompetence, and her confusion on the terms of the Lease that she supported enthusiastically when it suited her political aspirations. Mayor Gillmor is spending millions on PR consultants, advisors, and providing raises, during a global pandemic, to the already highest paid City Manager in the state, all while knowing the city’s budget is in disarray and has been for years. Instead of scapegoating the 49ers, it is time for the Mayor to look inward.”
Sunday’s game at Levi’s Stadium will be held without fans in the stands due to the ongoing COVID-19 pandemic. It remains unclear when fans would be allowed to attend any home games this season.
The team has had a fractious relationship with the city of Santa Clara over the past two years. A year ago, the Santa Clara City Council voted to terminate an agreement with the San Francisco 49ers which allows the team to manage the stadium for all concerts and entertainment events.
There had been recurring problems with concerts held at Levi’s Stadium that had acts performing past curfew, including shows by U2, the Rolling Stones and Coldplay.