Both acft were operating in vfr conditions modified by slight haze, high overcast and low sun angle near airport. N6161m was performing lazy eight maneuvers in a normal practice area two miles east of airport; n8267q was in clockwise orbital descent for landing following a parachute jump plane. Radar data and witness informtion show that on east side of airport, n8267q deviated from orbit and proceeded southeast as n6161m completed north end of figure eight in right turn away from airport and proceeded south. Acft converged at about 30 degree closing angle with n6161m climbing and n8267q descending and collided at about 2500 ft agl.
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