The state of California announced Wednesday it struck a tentative deal to sell the Orange County Fairgrounds to a local government authority for $96 million.
The agreement to sell the 150-acre property to the Orange County Fairgrounds Authority comes after the state rejected a lower bid from a private buyer in March. The state Legislature must approve the transaction.
"This is an excellent opportunity for the local government to gain control of this valuable asset while guaranteeing the state will receive revenue that is critical to help shore up our state budget," said State and Consumer Services Agency Secretary Bill Leonard in a statement obtained by the Orange County Register.
"The agreement is a win-win for California taxpayers and the citizens of Costa Mesa as the fairgrounds will continue to be owned and run by local entities."
The joint powers authority is made up of the City of Costa Mesa and the Costa Mesa Public Finance Authority.
According to the State and Consumer Services Agency, the fairgrounds authority will immediately pay $19.2 million. The remainder will be financed with a 40-year promissory note with 5 percent interest.
The new owners will plow revenue back into the property for four years before beginning to make principle payments.
The state has been trying to sell the property to help raise cash to address California's $19 billion deficit.
It held an auction in January, but the Department of General Services rejected a high bid of $56.5 million from Lake Forest, Calif.-developer Advanced Real Estate Services Inc., saying it did not bring the highest return for the state.
State officials initially estimated the fairground located in Costa Mesa could raise between $96 million and $180 million.