Disney saves tens of millions of euros a year for a special condition that it has enjoyed for decades. It is said to be the most efficient local government in Florida, because it is not a typical bureaucracy, but operates like a business. Government? Yes. Disney has its own local government and can collect taxes, pass building codes and control public services within its territory, where its resorts are located and theme parks. Until now.
The Florida Senate has passed a bill to eliminate Disney’s Special Tax District. The House, led by the Republicans, does not seem right that they oppose their legislation on gender and sexuality.
special status. The special district, created in 1967 and known as the Reedy Creek Improvement District, exempts Disney from a number of regulations and certain taxes and fees. It has enabled the entertainment company to run its theme parks and resorts in the state with little red tape for more than 50 years.
In fact, Reedy Creek has a permanent population of about 50 people, plus its own board of supervisors and fire department. Allows Disney to build new buildings and expand its parks without having to comply with state or county regulations related to construction, wastewater management and drainage. It encompasses four theme parks, two water parks, a sports complex, and hotels, shops, and restaurants.
The new law. The Republican-led Florida Senate approved two days ago a bill that would eliminate the special tax district that allows Walt Disney to rule the earth, as lawmakers take aim at the company for opposing legislation restricting classroom instruction on gender and sexuality. Losing the district near Orlando could be a serious blow to its Florida operations.
Under the bill, any special district established before the Florida Constitution was ratified in 1968, and not renewed since then, would be dissolved on June 1, 2023. Disney could seek to reinstate a special district after its dissolution.
Why? Florida Governor Ron DeSantis and Republican lawmakers have clashed with Disney for the company’s opposition to the recently signed Parents’ Rights in Education Act, which critics call the “Don’t Say Gay” legislation. The measure bans classroom instruction on sexual orientation and gender identity through third grade, and limits it for older students to “age-appropriate” material.
Disney initially did not comment on the legislation, but was pressured by employees to oppose it. After it passed, the company vowed to push for its repeal and fight similar bills in other states.
How did your self-government work? “You’ll find that you’ll never see potholes when you get to Walt Disney World. That’s because Disney doesn’t have to wait for the county to come fix them,” explained David Ramba, director of the Florida Association of Special Districts, in this article from The Wall Street Journal.
Currently, Disney pays property taxes and other taxes to both counties. In addition, the company, as the primary owner of Reedy Creek, provided the bulk of the $140 million in tax and fee revenue the district collected in fiscal year 2021. That money covers all of the district’s government spending, including the payment of approximately 400 employees salaries and services in debt of long-term bonds that Reedy Creek has issued over the years.
Other benefits. If the district is dissolved, that debt would become the responsibility of Orange and Osceola county taxpayers, but the counties will likely establish a new special taxing district to link bond payments to tax revenue produced by Disney properties. inside Reedy Creek. Some of the taxes and fees Disney pays would go to local governments.
There are two other valuable benefits that Disney receives from the state that lawmakers have not yet addressed. One is a $570 million tax break that Florida offered the company to relocate some 2,000 employees to the state. The other is an Orange County law that taxes hotel rooms to promote tourism. It must be remembered that Disney employs almost 80,000 people in the state. Tourism in the area brings in $5.8 billion in state and local tax revenue annually when operating at full capacity, according to Visit Orlando.
Image: Unsplash