Greetings, Car4Doc -
One model I have seen work EXTREMELY well had a group say "We want to do a festival", then they contacted every group and festival of the type they wanted to run within a couple hundred miles and asked "How do you do YOURS?" They then took a couple of years (really!) to sort through the information they got and come up with a plan.
The results have been phenominal - one of the absolute best one day festivals I have ever seen. I've attended four or five years now, and my band played there this past year. They enlisted the support of the local city government/council, local business, based performers around local and regional acts with a couple of major names to get a draw from outside the immediate area (and to generate excitement), and drew in scads of vendors that offered a wide variety of goods in a reasonable price range.
Then take the bits suggested here and run with it (I particularly liked the "beer mat" suggestion - may use that myself on a project - should work better than mousepads...)
The festival I ranted about is in Michigan - their URL is www.salineceltic.org. Drop them (and any other festival you yourself like) a message, I bet you'll get a pile of help.