Tel-Phil Enterprises, which operates the OC Marketplace swap meet at the Orange County Fairgrounds, might be close to a long-term deal with the Fair Board just two months after a board contingent was poised to terminate the swap meet’s lease.

In September, former Fair Board President David Ellis declared, “let the lawsuits begin” after seemingly persuading the board to end a 42-year relationship between Tel-Phil and the fairgrounds.

Ellis argued that in the world of online retailers like Amazon and eBay had made outdoor swap meets an outdated model. Ellis, Fair Board member Dale Dykema andFair Board attorneys blasted Tel-Phil owner Jeff Teller as a difficult partner. Fair Board staff also cited a series of statistics showing that swap meet sales had slumped over the last decade.

Yet at that same meeting, competitors like Delaware North told Fair Board members they were ready to bid on a lease. A request for proposal was prepared for a similar swap meet operation.

Activists in turn accused Fair Board members of targeting Teller simply because he was among the leaders of a vocal opposition against an unsuccessful, two-year attempt by the board to privatize the iconic 150-acre property in Costa Mesa.

Swap meet vendors were equally incensed and argued that instability triggered by the Fair Board’s actions, not competition from online merchants, was responsible for the decline in swap meet businesses. They demanded that Fair Board members work out differences with Tel-Phil Enterprises.

Tempers had cooled somewhat by the meeting in October. New Fair Board member Nick Berardino, general manager of the Orange County Employees Association, persuaded the board to rethink the lease termination and form a subcommittee to come to terms with Teller.

The board agreed and appointed Berardino and Vice Chair Douglas La Belle to the subcommittee.

After a series of meetings in early November, the subcommittee and Tel-Phil were apparently able to make substantial progress. Late Thursday, the subcommittee put forth its recommendations that the lease termination procedures be halted.

Both Berardino and La Belle reported that the groundwork was established for a more fruitful and long-term lease relationship with Tel-Phil, including heightened cross promotions and additional capital investment in the property.

The committee reported that it “strongly believes that the spirit of collaboration and actual progress made during the two meetings with Tel-Phil Enterprises seems to have established a turning point in the relationship.” Its report will be considered at next week’s Fair Board meeting.

“All of the participants feel that they have embarked on a path that will lead not only to an agreement, but also to the long-term mutual success of both OCFEC and the Market Place,” the report stated.

Board subcommittee members intend to produce a strategic plan for their colleagues by January.

Teller issued a supportive statement on Friday.

“On behalf of all the small businesses, staff and leadership of the OC Marketplace, we would like to thank the Orange County Fair Board’s subcommittee of directors Doug Labelle and Nick Berardino and fair staff for their thoughtful reconsideration,” Teller wrote.

Fair CEO Steve Beazley, who also took part in the subcommittee’s negotiations, did not respond to several calls for comment.

Beazley remains the focus of ire from the OC Fairgrounds Preservation Society, which was formed in 2009 to fight sale of the fairgrounds.

Members have rebuked Beazley for contracts with former state Sen. Dick Ackerman and the lobbying firm of Platinum Advisors, which enabled Fair Board members to communicate with legislators and former Gov. Arnold Schwarzenegger’s with little public oversight.

Much of those transactions — the subject of several Voice of OC investigative reports — remain the focus of an ongoing probe by the state’s Fair Political Practices Commission.

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