Florida Governor Ron DeSantis will have effective board control of the special tax area that Disney has operated for more than 50 years under a new proposal from U.S. state lawmakers.
However, the area itself will remain largely untouched as part of the proposal, after DeSantis appears to have balked at a threat to disband it entirely.
Legislation introduced Monday aims to end a dispute that erupted in April, when DeSantis, a Republican, signed a bill to revoke Disney’s ability to govern the area around the Walt Disney World theme park in Orlando. . The move was seen as retaliation for the entertainment company’s opposition to the state’s so-called Don’t Say Gay bill.
DeSantis has frequently called Disney a “woke” corporation, taking a bold stance against his state’s largest private employer.
The special district allowed Disney to step in to cover the costs of providing water, electricity, roads, and fire services to the area. The Financial Times reported in December that state lawmakers were working on a compromise that would keep the arrangement largely in place with some changes, including the possibility of DeSantis appointing board members.
The 189-page bill says the tax area, known as the Reedy Creek Improvement District, “is not dissolved, but continues in full effect under its new name,” which will be the Central Florida Tourism Oversight District. The word “Disney” does not appear in the bill.
Tax collection, outstanding debt and district contracts will remain the same. But DeSantis will be allowed to name the five members of his board of directors.
The proposal comes just two days before Disney’s Bob Iger addresses investors for the first time since returning to the company as chief executive in November.
The proposed measure will come as a relief to Reedy Creek bondholders if passed by the Florida Legislature in a two-week special session, which began Monday.
Fitch Ratings placed Reedy Creek’s debt on negative watch after lawmakers moved to dissolve the district last year, but the proposal allayed those concerns, said Michael Rinaldi, head of local government ratings at Fitch.
“The bill appears to address key uncertainties created as a result of last year’s dissolution legislation, primarily by preserving the district’s revenue-raising powers and its ability to service its debt,” said Rinaldi.
A DeSantis spokesperson, Bryan Griffin, said on Twitter that Reedy Creek had “offered extraordinary special privileges to one company only.”
“It’s over, and we’re starting a new era of accountability and transparency,” he added.
Anna Eskamani, a progressive Democrat who represents Orlando at the Florida House, said “on the whole, Disney will accept the bill.” But she condemned DeSantis’ push to name all board seats as a “power grab” and a “gross prank on corporate responsibility.”
In a statement, Disney said it was monitoring progress on the bill, which it called “complex” given the special tax district’s long history.
“Disney works under a number of different models and jurisdictions around the world, and regardless of the outcome, we remain committed to providing the highest quality experience for the millions of Guests who visit each year,” said said Jeff Vahle, chairman of Walt Disney World. Resort.