Court Halts OC Fairgrounds Sale

Wednesday, Jun 8, 2011 | Updated 11:42 AM PDT

A three-judge state appellate panel struck down the sale of the Orange County fairgrounds to a private company Tuesday, finding the bidding process to be flawed.

The 4th District Court of Appeal halted the sale of the 150-acre property to Facilities Management West for $100 million.

"Any future sale must begin again at square one," the court wrote, according to the Orange County Register.

Losing bidders filed a lawsuit challenging the deal and a local court put the sale on hold in November.

The panel found that the bidding process didn't have an appraisal or a procedure for losing bidders to protest and appeal.

The court found that the state Department of General Services failed to compare the $100 million sale price with fair market value.

The department said the sale price was fair market value, citing state law, which says a "transaction based on ... a public bidding process shall be deemed to be the fair market value."

The court wrote that the state admitted that the highest bid and the value of the property are different when it rejected a high bid of $56.5 million cash during its first bidding process in March 2010. The state argued that, that bid required cash up front and a later bidding process allowed for financing.

"The Department at the time obviously had a good idea of the Fairground's fair market value independent of whatever bid happened to be the highest," the court wrote.

Negotiations to sell the property to Costa Mesa also fell apart.

Assemblyman Jose Solorio, a Democrat from Anaheim, was one of the parties suing to stop the sale.

"The court's decision today is a great victory for the residents of Orange County," he wrote. "I hope the governor lets us keep our fairgrounds public and does not put the fair out to bid again."

The fairgrounds and other state properties were put up for sale last year to help close California's budget deficit.