Disney says Florida can't dissolve theme park's special tax status
The feud between Ron DeSantis and Florida's largest private employer now centers on whether the state can legally dissolve the special tax district that governs Walt Disney World, as the governor and local lawmakers did last week.
The sparring began after DeSantis last month signed a controversial bill barring schools from instructing children in kindergarten through third grade on issues related to sexual orientation and gender identity. Disney CEO Bob Chapek initially tried to stay out of the heated public debate over the measure, derided by critics as the "Don't say Gay" law. But with pressure growing from inside the company to oppose the measure, he eventually came out publicly against the measure at his company's annual shareholders meeting in March.
The Republican governor responded by seeking to tarnish Disney as "woke," and moved to end the special status that allows the resort to effectively run as its own municipal government on the 39-square mile property it owns, called the Reedy Creek Improvement District.
Making its only public statement since the Republican governor and lawmakers directed their ire at Disney, the company this week expressed confidence to investors that the state could not legally void its 55-year arrangement so long as the Reedy Creek district's bond debt was not paid off.
As a result, the bid to disband the special tax district in Orange and Osceola counties would break an agreement made by Florida when it created the district in 1967, the company signaled.
Posted on the website of the Municipal Securities Rulemaking Board on April 21, Disney stated: "In light of the state of Florida's pledge to the district's bondholders, Reedy Creek expects to explore its options while continuing its present operations, including levying and collecting its ad valorem tax bonds and utility revenue bonds, complying with its bond covenants and operating and maintaining its properties."
Florida is contractually obligated not to get involved with the district until the bond debt is paid off, Jacob Schumer, a municipal attorney with Maitland, Florida, law firm Shepard, Smith, Kohlmyer & Hand, told CBS MoneyWatch.
"The task of dissolving a special district and dividing its responsibilities between two counties is tremendous," he said.
Disney did not respond to a request for comment. The employs about 80,000 people at the resort, which includes multiple theme parks, hotels and its own bus fleet.
The political brouhaha is likely to continue, with DeSantis signaling that he is ready to press the fight with Disney.
"The governor's team is working on administering this legislation which is designed to level the playing field for businesses in Florida. When we have more to share on our path forward, we will be glad to send it along. As the governor has consistently stated, Floridians will not have to carry Disney's burdens," a spokesperson told CBS MoneyWatch in an email.