County out of fair sale

Orange County has dropped plans to join Costa Mesa in trying to buy the Orange County Fairgrounds from the state.

County Supervisor John Moorlach said Wednesday that the county, which had placed a joint bid with Costa Mesa on the fairgrounds, is not involved in the city’s current negotiations to buy the 150-acre property.

“At this point, the instructions we gave the [county] CEO, the number the state is looking at, we’re not interested,” he said.

And while state officials have said they would like to sell the fairgrounds in Costa Mesa by June 30, the end of the fiscal year, city officials involved in the negotiations said the sale might not happen before then.

In addition, the city is trying to meet an April 19 deadline for submitting a proposal to the state.

City Manager Allan Roeder said it’s been difficult for the city to fully grasp what the state is looking for in the near term.

“But we do not expect to have a deal in two weeks — no reasonable party would expect that given the intricacies of a transaction of this size,” he said. “We do expect to have something to them of sufficient detail to engage them further, resulting in a sale.

“We are not responsible for the state budget so I consider it a wholly separate issue from the property transaction. I think that going back to the Request for Proposals that the state issued last fall is probably more on point than second- or third-hand informal representations. That schedule had the [fairgrounds] remaining intact through this year’s annual fair with proposed closing of escrow in October.”

Roeder said the city is not specifically timing the possible purchase for October, but he doesn’t see a transition taking place until after this summer’s fair.

“To do otherwise would be a disservice to everyone, in my judgment,” he said.

Regardless of if and when a sale happens, Costa Mesa’s negotiating team is up against a tight deadline to give the state its proposal to buy the property.

Project Manager Becky Bailey-Findley, who’s leading the team forming the proposal, said she’s confident they’ll have a proposal ready by the April 19 deadline.

“Yes, the pressure is intense,” she said. “There are a lot of details that need to be fully vetted and analyzed and brought together so there’s a responsible and feasible plan.”

State officials declined to comment on the negotiations.

City officials have pledged that money for a purchase of the property – valued by the state to range between $96 million and $180 million — will not come from Costa Mesa’s general fund.

Bailey-Findley would not give details on what the city is willing to pay for the fairgrounds or how it would finance a deal, but she did say that fair operators — such as the O.C. Marketplace, Equestrian Center and Pacific Amphitheater — are going to have to take on much of the burden in paying for it.

In late March, Costa Mesa entered into negotiations with the state to buy the fairgrounds in late March after the state rejected public bids in January. The high bid at the January auction was $56.5 million by Newport Beach-based Craig Realty Group.

“I think the one generality I can say is that the operation of the property is going to have to service the debt,” she said. “The debt is going to be substantial.”