49ers in brawl with Santa Clara over a $600,000-plus bill for floor polishing

Levi's Stadium hosts the first preseason football game between the San Francisco 49ers and the Denver Broncos in Santa Clara, CA, Sunday, August 17, 2014. Levi's Stadium hosts the first preseason football game between the San Francisco 49ers and the Denver Broncos in Santa Clara, CA, Sunday, August 17, 2014. Photo: Michael Short / The Chronicle 2014 Buy photo Photo: Michael Short / The Chronicle 2014 Image 1 of / 3 Caption Close 49ers in brawl with Santa Clara over a $600,000-plus bill for floor polishing 1 / 3 Back to Gallery

With revenue at Levi’s Stadium falling short of the goalposts, the city of Santa Clara and the 49ers are finding new reasons to squabble — including operating costs, parking lots and property taxes.

In the latest spat, the city attorney on Thursday told the San Francisco 49ers that the team may be in violation of its contract with the city regarding floor work done at the billion-dollar stadium, according to documents obtained by The Chronicle.

Rahul Chandhok, a spokesman for the 49ers, said it was a “dispute regarding paperwork.”

Levi’s Stadium is owned by the city through its Stadium Authority, which contracts with a 49ers affiliate to operate the venue.

The city says a stadium manager presented it with a bill for epoxy coating and polishing of the concrete floors in parts of Levi’s Stadium in August without seeking its approval first.

“Normally, this is not something you would get in a battle about,” said Roger Noll, professor emeritus of economics at Stanford University and an expert on the economics of sports. “The reason they’re having a fight about it instead of just having a meeting is because the well has already been poisoned between them.”

The hotly debated deal to build Levi’s Stadium with public funds, once cast as a financial windfall for city and county agencies, continues to sour. One major point of dispute is a city curfew that the team says is depressing event revenue.

“The outcome hasn’t been quite as rosy as the forecast,” Noll said.

Since the stadium opened in 2014, the team has endured a blitz of political opposition from Santa Clara City Hall, with politicians questioning everything from how it manages the stadium to how it spends public funds. The 49ers had asked the city to slash the team’s rent by $4.25 million last year. The dispute went to arbitration, and the city instead won an increase in rent by $262,000 a year — a difference of around $180 million over the 40-year lease agreement.

In January, the 49ers won a rare victory over the city when an appeals board ruled to cut the assessed value of Levi’s Stadium in half, forcing county agencies to pay out $36 million in property tax refunds by the end of the year.

The latest dispute involves smaller amounts, but could have larger consequences, as the city now plans to speed up an already announced audit of ManCo, the company created by the team to manage stadium operations.

City Manager Deanna Santana wrote to the 49ers saying the step was needed “given the unknown magnitude of potential non-compliance.”

While the team manages the stadium day to day, the Stadium Authority serves as its landlord. It gets the final say on vendor contracts using public funds costing more than $100,000.

Last year, the stadium manager hired a contractor to work on the stadium floor. The cost for these services came to $643,568, more than six times the amount that requires city review, according to Lenka Wright, a spokeswoman for the city of Santa Clara.

The project was supposed to be done by Jan. 31 of this year, but the work was put on hold indefinitely.

“We need a good partner to manage this public asset and one who follows the Stadium Management Agreement. It’s up to the (49ers) to demonstrate they are that partner,” said Wright.

The 49ers organization plans to pay the contractor for the work and absorb the full cost, instead of billing the city, said Chandhok in an email.

The city’s action “has unfairly put hard-working speciality craftspeople in the middle” of the city and the team’s dispute, he said.

Santana’s letter said the team violated state labor codes on wages paid to contractors on public works projects, who are owed the “general prevailing rate” for such work.

The city manager has given the 49ers until April 12 to show the team in compliance with California labor laws and hand over copies of all contracts.

Melia Russell is a San Francisco Chronicle staff writer. Email: melia.russell@sfchronicle.com Twitter: @meliarobin