I didn't know anything about the sale of the Orange County Fairgrounds before I read this case. All I would assume (and I continue to do so) is that it's simply another component of the fake "budget balancing" that the state and numerous municipalities are doing nowadays in light of the Great Recession.
But the more I read about this particular sale, the more I'm glad that the Court of Appeal vacated it. Not only is Justice Rylaarsdam correct that the sale violated the relevant statutes -- fairly clearly, I might add -- but the entire bidding process seemed to me a crock. Everyone just happens to bid almost the identical amount ($97, $98, $100 and $100 million, respectively), and every bidder was totally manipulating the terms to look like the highest bid but with absurd present valuation and credit risk.
For example, the "highest" bidder in terms of present value was Advanced Real Estate, who bid an "actual" $100 million (i.e., a bid with a present value of $100 million), as opposed to the other "$100 million" bid, which had an actual present value of $20 million less since its payments both escalated and were spread out over time. But Advanced Real Estate's bid said that it'd pay nothing for the first eight years, and then at the end of 40 years, would owe -- and allegedly pay -- over a half billion dollars. Yeah, right. I'm totally sure you wouldn't just file for bankruptcy at that point, having already pocketed the proceeds from the fairground over the past 40 years. I'll definitely take your word for it that you'll for sure pay the half-billion dollar note.
Maybe all of these public bidding schemes are manipulative shams. I don't know. But this one sounded like that to me. In spades.
So not sad to see it disappear. At least for now.
