The Orange County Fair Board on Thursday agreed to ask the state attorney general's office to return as its legal counsel.

The state's highest-ranking law enforcement arm backed away from the O.C. Fair & Events Center two years ago because of possible conflicts of interest during the proposed fairgrounds sale.

The move could save the state-controlled board — the 32nd District Agricultural Assn. — hundreds of thousands of dollars in legal bills in the years to come.

The board was slated to sign on for a third year with law firm Manatt, Phelps & Phillips on Thursday before one of the board's newest members, Stan Tkaczyk of Newport Beach, objected to it.

The firm's legal costs last year amounted to more than $325,000, with about 40% of that going toward lease issues with Tel Phil Enterprises, operator of the weekend swap meet.

The contract proposed Thursday was for $200,000.

According to a report in the Voice of OC news website last year, the board's legal fees with the attorney general's office in 2009 amounted to about $58,000.

Tkaczyk pointed out that because the fairgrounds sale died in court last year, the board should look at returning to using the attorney general's office along with other state agencies.

The attorney general's office backed away from the board in late 2009, just months after the 150-acre state property was put up for sale and rumors swirled around the board's next step.

The move was unheard of at the time, and it only amplified a growing suspicion among the public that the nine-member board was trying to flip the property for personal profit.

The board hired a former lawmaker to push for the sale, according to board critics, and created a nonprofit to buy the property. Board members argued they wanted to keep it out of the hands of developers.

"Given the seemingly intertwined and potentially conflicting interests of the district, the district board members and the nonprofit, we have determined that we should withdraw from providing legal services to the district, including the district board, until all the issues relating to the proposed sale of the district fairgrounds have been resolved," J. Matthew Rodriguez, the chief assistant attorney general, wrote to then-board Chairwoman Kristina Dodge.

Hedging its bets, the board unanimously approved the contract with Manatt, Phelps & Phillips, but added a caveat that it can drop the firm as soon as the attorney general's office agrees to represent the board again.

joseph.serna@latimes.com

Twitter: @JosephSerna