Disney sues DeSantis, calls theme park taxing district takeover "retaliation"
ORLANDO - The Disney Co. has filed a lawsuit against Gov. Ron DeSantis on Wednesday over the Republican's takeover of its theme park district, alleging the governor waged a "targeted campaign of government retaliation" after the company opposed a law critics call "Don't Say Gay."
The Central Florida Tourism Oversight District board of supervisors -- the board named by DeSantis and packed with his allies earlier this year -- took over the Reedy Creek Improvement District, the special taxing district that for half a century gave Disney control over the land around its Central Florida theme parks.
The suit was filed minutes after the board appointed by DeSantis voted to invalidate an agreement struck between Disney and the previous board in February, just before that board's dissolution.
"Disney picked the fight with this board. We were not looking out for a fight," said Martin Garcia, chair of the Central Florida Tourism Oversight District, adding "bottom line, what our lawyers have told us, is factually and legally what they created is an absolute legal mess. It will not work."
The move is the latest escalation in the fight between DeSantis and Disney, one that could trigger a legal battle as DeSantis moves toward a 2024 presidential bid.
The yearlong fight has strained what had long been a cozy relationship between Florida's government and the state's best-known employer and attraction of tourist dollars. DeSantis earlier this month suggested the state could build a prison or competing theme park on what had for decades been Disney-controlled property.
The governor's battle with Disney has become a flashpoint in the early stages of the 2024 Republican presidential primary. Former President Donald Trump and a slew of other candidates and potential rivals, including former New Jersey Gov. Chris Christie, have lambasted DeSantis for his actions, characterizing them as anti-business.
After a hearing in which several business owners, including those who run restaurants and bars at Disney World locations, urged the board to work with Disney, Garcia said the board would seek to raise taxes to pay for its legal fees in evaluating and combatting what he called "eleventh hour agreements."
"Because that's going to cost us money, we're going to have to raise taxes to pay for that," Garcia said.
Before the DeSantis-selected board was in place, Disney in February reached an agreement with the outgoing board that seemed to render the body powerless to control the entertainment giant. The DeSantis administration was unaware of the agreement for a month and vowed retribution after it became public.
The agreements Disney signed with the previous board ensured the company's development rights throughout the district for the next 30 years and in some cases prevented the board from taking significant action without first getting approval from the company. One provision restricted the new board from using any of Disney's "fanciful characters" until "21 years after the death of the last survivor of the descendants of King Charles III, king of England."
Its development agreement was approved over the course of two public meetings held two weeks apart earlier this year, both noticed in the local Orlando newspaper and attended by about a dozen residents and members of the media. No one from the governor's office was present at either meeting, according to the meeting minutes.
Disney has said all agreements made with the previous board were legal and approved in a public forum. Disney CEO Bob Iger has also said that any actions against the company that threaten jobs or expansion at its Florida resort was not only "anti-business" but "anti-Florida."
In Wednesday's meeting, the board's special general counsel, Daniel Langley, walked through its legal argument for nullifying the deal between Disney and the previous board.
He said the board had not provided the required public notice of its meetings, and said the agreement was not properly approved by two municipalities within the district, the cities of Bay Lake and Lake Buena Vista.
He also argued that previous amendments to Disney's long-term comprehensive plan were not properly vetted and approved by those two municipalities.
"The bottom line is that a development agreement has to be approved by the governing body of a jurisdiction, and that didn't happen from the cities that have jurisdiction," Langley said.
Former Florida Supreme Court justice Alan Lawson, an attorney hired by the district, said that "the old board attempted to act without legal authority to act."
"This is essentially about what it means to live and work in a country governed by the rule of law. Everyone must play by the same rules," he said. "Disney was openly and legally granted unique and special privilege -- that privilege of running its own government for a time. That era has ended."
The end of a decades-old agreement
The state legislature created the Reedy Creek Improvement District in 1967 and effectively gave Disney the power to control municipal services like power, water, roads, and fire protection around its Central Florida theme parks that didn't exist before Walt Disney and his builders arrived. But the special district also freed Disney from bureaucratic red tape and made it cheaper to borrow to finance infrastructure projects around its theme parks, among other significant advantages.
That special arrangement, though criticized at times, was largely protected by state politicians as both Disney and Florida benefited from the tourism boom.
The unlikely fracturing of Florida's relationship with its most iconic business started during the contentious debate last year over state legislation to restrict certain classroom instruction on sexuality and gender identity. Disney's then-CEO, Bob Chapek, facing pressure from his employees, reluctantly objected to the bill, leading DeSantis to criticize the company. When DeSantis signed the legislation into law, Disney announced it would push for its repeal. DeSantis then targeted Disney's special governing powers.
For DeSantis, who has built a political brand by going toe-to-toe with businesses he identifies as "woke," the latest twist threatens to undermine a central pillar of his story as he lays the groundwork for a likely presidential campaign. An entire chapter of his new autobiography is devoted to Disney, and the saga is well-featured in the stump speech he has delivered around the country in recent weeks.