The Orange County Fairgrounds might not be Gov. Arnold Schwarzenegger’s property to sell. In fact, the people of Orange County might be the rightful owners of the 150-acre site in Costa Mesa.

Lawyers for the fair’s Board of Directors have uncovered documents that they say show that the 32nd Agricultural District, the Orange County entity that has run the fair for a half century, owns the property, say sources close to the Fair Board.

This is yet another twist in the bizarre saga of Schwarzenegger’s more than year-long attempt to sell — and most recently the city of Costa Mesa’s attempt to buy — the property for $96 million.

Fair board members are expected to announce their lawyers’ discovery Friday morning.

In short, the lawyers have documents showing that the Agricultural District purchased the Fairgrounds property from the U.S. Army shortly after World War II for $130,000, sources say.

At the time, a consortium of local leaders gathered together $65,000 and went to the state’s horseracing fund to borrow the rest as a grant to complete the purchase, sources say.

Since then, no general funds have gone toward the site.

At a minimum, that means that the governor can’t count on getting the full $96 million out of a sale of the property, the board members will contend. It also could mean that the governor doesn’t have the authority to sell it at all because it belongs to the people of Orange County.

Just another strange development in what has become the strangest of real estate snarls.

Last year, the Fair Board attempted to form a nonprofit to purchase the Fairgrounds from the state. Based on that local support, legislators adopted a last-minute sale provision in their budget deliberations.

Yet that plan quickly blew up when violations of conflict of interest and open meetings laws were alleged, and the California attorney general resigned from representing the Fair Board by the end of the year.

In January, Schwarzenegger put the property out to bid. But that plan blew up in March, when he withdrew the auction tag.

That prompted a quick-and-dirty private negotiation with Costa Mesa and a several private sector bidders. That process went off the tracks last month when California Assemblyman Jose Solorio wasn’t able to get any support for the needed legislation to complete the sale to a firm, Facilities Management West.

Schwarzenegger has once again put the property up for bid with a Sept. 30 deadline.

As always with this saga, more to come.


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