I have been seeing this error quite often after redeploying Azure Functions into some of our test environments lately.
The bug and a lot of details can be found here:
https://github.com/Azure/Azure-Functions/issues/226
The problem would remain after restarting the Function App, and even after deleting the entire app service and recreating it.
What I found to work was deleting the storage account which the Function app was connected to. The Function App has a reference to a Storage account in application settings AzureWebJobsDashboard, AzureWebJobsStorage and WEBSITE_CONTENTAZUREFILECONNECTIONSTRING (if you are running on a consumption plan). Either clearing out this storage or simply recreating it fixed the problem.
I would also recommend creating separate storage accounts for every Function app - at least as long as these hard-to-find bugs are present. It is a lot easier to fix these kind of issues when they are only affecting a single Function app.
