A group of businesses led by Jeff Teller, president of Tel Phil Enterprises Inc., which runs the weekly swap meet at the fairgrounds, filed a lawsuit claiming that the state violated its constitution by not following all the guidelines in the sale.
The lawsuit alleges that the Department of General Services, which is in charge of selling the fairgrounds, favored and helped Facilities Management West, the Newport Beach-based investment group that is buying the fairgrounds, land the bid for $100 million. An Orange County Superior Court judge then issued a temporary restraining order prohibiting the state to sell the land to Facilities Management.
A court date is scheduled for Dec. 15.
"My legislation is consistent with the plaintiffs," Solorio said. "The sale is flawed and the judge needs to slow it down."
Solorio said before the state can sell the fairgrounds, the Legislature needs to know its true market value. When the state issued its first bid last October to sell the fairgrounds, it estimated it would bring between $96 million and $180 million.
However, General Services officials have said that no official appraisal of the property was made before the state put the property up for sale.
The state's second bid also indicates that General Services must notify the Legislature of the sale. However, when Facilities Management was named the winning bidder, the Legislature was out of session, which raises questions about whether there was proper notification, Solorio said.
"DGS itself had in its last RFP [request for proposal] made mention that a certain part of the agreement would require Legislature approval," he said. "We need further definition of that."