From the facts you've described, there is nothing illegal about the camera set-up operation. As you know, he's doing this to get under your skin. A way to counter-act that, and frustrate his intentions, is to go over and thank him for his free surveillance operations. Sounds crazy, I know. But think about it, people/businesses can pay big bucks to have cameras installed to have their property protected. He's providing this service to you for FREE and you can let him know that, in the event that there's any property mischief or damage, you are going send to police over to his place to view the video footage.
As for his going to the council meetings, there's really nothing that you can do about that because he has a constitutional First Amendment right of free speech and right to go to his elected officials for a redress of his grievances (no matter how fruity they may be).
Now, as for his statements to others that he wants to put you out of business. On that front, you may want to contact a local lawyer and ask the lawyer to write a little nasty-gram for you on the lawyer's letterhead basically asking him to knock off the threats or risk being sued for tortious interference
of your business. It's basically letting him know that there's a line and, if he crosses it, you may go after him for lost business which you can attribute to his non-protected activities.
Good luck and best wishes for better days ahead. I hope that you find this information to be helpful and this answer to be ACCEPTable!