Reedy Creek Ending, Or Not?

So the Florida Senate has passed a law recinding old Improvement Districts. This would include Reedy Creek. I.e Walt Disney World.

Disney seems to think this would require them to vote to approve it. I’m thinking a new law would override the old one. Guess if will end up with lawyers….

https://www.tallahassee.com/story/news/2022/04/20/florida-senate-votes-remove-disney-reedy-creek-after-speaking-out-desantis-dont-say-gay-bill/7380256001/

The Florida Senate voted Wednesday to strip the Walt Disney Company of special privileges in regulating and maintaining 38 square miles of Central Florida, home to its six theme parks and resorts.

The 23 to 16 vote on SB 4 came one day after Gov. Ron DeSantis said he wanted the Legislature to repeal the governing structure for Disney’s Florida properties.

The entertainment giant became ensnared in election-year culture warfare when its CEO vowed to work to repeal the Parental Rights in Education Act – which opponents decried as the “Don’t Say Gay” law.

While lawmakers debated the measure, the DeSantis campaign for governor sent out a fundraising pitch declaring Disney had picked a fight with “the wrong guy” and for contributors “to join the fight against the Democratic machine and woke Disney executives.”

Democrats protested the Republicans’ rush to punish the state’s largest private employer for political speech degraded the legislative process.

“With all due respect, this is not about meaningful legislative review. This is punishment. It is political theater, and we are better than this,” said Sen. Loranne Ausley, D-Tallahassee.

The measure by Sen. Jennifer Bradley, R-Green Cove, includes a carrot and stick approach in that it does not go into effect until June 2023, time enough for Disney, in the words of the House sponsor, Rep Randy Fine, R-Brevard, to reconsider its criticism of Florida law.

“This is kind of like parents putting their kids on restrictions. Clean up your act, apologize, say you’re sorry, and agree to change your behavior. Maybe you’ll get your phone back or your other privileges,” observed Ausley.

At issue is the Reedy Creek Improvement District, a special district created in 1967 that provides Disney with unprecedented taxing and regulatory authority to build an entertainment empire that has grown into the world’s No. 1 tourism attraction.

The House and Senate sponsors of the repeal argue Disney is out of compliance with a 1997 law that required districts to seek recodification. Disney would have a year to get its paperwork in order and ask the Legislature to reauthorize Reedy Creek.

Sen. Jason Pizzo, D-Fort Lauderdale, complained during debate the Legislature was wasting everyone’s time.

If Reedy Creek were dissolved, he pointed out, Orange and Osceola counties would have to assume more than $1 billion in debt and be responsible to maintain a network of roads and wastewater facilities, and also staff a 3,000-member firefighter and paramedic squad.

“Everyone in this room knows this is not going to happen,” said Pizzo about saddling two counties with billions in debt.

Pizzo told Bradley he was sorry she had “to do penance” for voting no against “Don’t Say Gay,” by having to sponsor the Disney repeal measure.

Turning to the Republican majority he said they are making it hard for him to explain to people what lawmakers do in Tallahassee, “When we’re up here for special sessions being spoon-fed bills that none of you wrote, that none of you had any input on, and then have to pass.”

Bradley responded that the Legislature will make sure that the “parade of horribles” Democrats describe will not happen.

Senate President Wilton Simpson said Disney and the state will take a “deep dive” over the next year to prepare for Reedy Creek’s dissolution.

“Disney folks will get their legal team together. They’ll meet with our legal team, the House, Senate, and Governor’s office. We will get the teams together to start to put a plan together,” said Simpson.

Rep. Spencer Roach, R-Fort Myers, has been pushing to revisit the Reedy Creek set up because he believes it gives Disney an unfair advantage in competition with other theme parks.

“I have a theme park in my district. It is the oldest and longest continually operating tourist attractions hub in Southwest Florida called the Shell Factory. They’d love to have their own government, but they don’t,” said Roach, portraying the battle as one between a “Roach and a Mouse.”

The House accepted the Senate bill Wednesday afternoon, and Speaker Chris Sprowls said the chambers will take it up Thursday morning.

That is a lot more nuanced than most of the stories on this. Seems to me the debt incurred can be taxed out of Disney once they are under local government taxes. Then a 3000 person fire department? I think somebody is smoking something. I’ve driven past the two fire stations on property. They look like about 4 engines each. Somebody is blowing smoke here.

Here’s the Disney News POV:

https://wdwnt.com/2022/04/dissolution-of-reedy-creek-improvement-district-must-be-approved-by-majority-of-residents-according-to-florida-statute/

Dissolution of Reedy Creek Improvement District Must Be Approved by Majority of Residents, According to Florida Statute
Florida Governor Ron DeSantis is attempting to dissolve the Reedy Creek Improvement District of Walt Disney World. A bill to dissolve Reedy Creek and other special districts passed the Florida Senate today. However, according to a Florida statute, the district cannot be dissolved without the approval of resident voters or landowners in the district.

Ares Lancaster
@what0080
If anyone wants to “Do Your Research” me on this one, may I present FL Statute 189.072: Dissolution of an independent Special District. Section 2a is of particular note:

FL 189.072

FL 189.072

So the Political Theater Food Fight is in progress, and the Dueling Lawyer Teams are warming up on the benches. Looks like we have about a year of this fight / fling poo event yet to go.

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About E.M.Smith

A technical managerial sort interested in things from Stonehenge to computer science. My present "hot buttons' are the mythology of Climate Change and ancient metrology; but things change...
This entry was posted in Economics - Trading - and Money, News Related, Political Current Events. Bookmark the permalink.

14 Responses to Reedy Creek Ending, Or Not?

  1. H.R. says:

    My money is on the team of salaried government lawyers 10:1 against the high-priced team of Disney.

    The Legislature is in the bag and the Judges know which side their bread is buttered on.


    The smart money knows when to hunker down and wait for DeSantis to term-limit out He who fights and runs away, lives to fight another day.

    Disney should just shut up and lay low… but they won’t. Dumb@$$ libs.

  2. philjourdan says:

    I was going to add that once Reedy Creek is gone, the Counties get to tax Disney and they can make up that kind of deficit in a couple of years! Without putting a burden on the rest of the county, since commercial property is always taxed differently than residential.

    But you covered that base. The long lapse between passage and enactment is the warning. Already there are rumblings that the Disney CEO is on his way out.. You do not bite the hand that feeds you and expect to kept getting fed.

    Get woke, go broke.

  3. philjourdan says:

    Liberals really are morons. There is no other way to take their moronic suggestions. They are telling Disney to just close up and leave. Have they ever heard of Real estate and capital investments? You cannot move most of those! ANd there is not a big market for a theme park ANYWHERE!

    Olbermann has got to be the stupidest moron on the planet.

  4. E.M.Smith says:

    @PhilJourdan:

    There’s also the issue of weather and water. The origibal site selection did an excellent job.

    Most places with the right weather don’t have the needed water (Arizona, New Mexico). You can pretty much eliminate anywhere north of Georgia due to snow and ice storms. Central Texas into Oklahoma is Tornado Alley. Gulf States like Mississippi are humidity nightmares. East Texas is mosquito heaven while west Texas is dry and hot. They already have a park in California.

    So good luck finding a place with 95% great weather, water to make a lush park with water rides, acceptable to good humidity most of the time, few freezing days and no snow, where it rarely gers over 90 F.

    Then figure out how to move a MANY billions investment for less than many $ Billions….

    30000 acres at $10k/acre (cheap) is about $300 million IF you could ever buy that much contiguous land again… (think nobody would notice it being bought up?). Developing it woukd take at least a decade. Buildings running about $250 / sqft figure what 10 million sqft of structures? Call it $2.5 Billion. Then you get to add rides, roads, landscaping, furnishings, busses (Disney is the largest bus system in the world), etc etc.

  5. Compu Gator says:

    If there was just a single State bill to remove Disney’s one-of-kind legal privileges, then Radio WDBO AM580/FM107.3 local news [*] reports before 8  p.m. EDT that Gov. DeSantis has “signed the bill.”

    ——–
    Note * : Its conservatism fouled by using ABC Radio for nonlocal news.

  6. E.M.Smith says:

    It was just one bill. He did sign it. It leverages a 1997? bill requiring some kind of re-legalization of old Special Districts that it is claimed Disney failed to do… So now Disney has until June 2023 to “re-apply” for their special district which may, or may not, be granted.

    There’s also a batch of bonds issued by Reedy Creek that have some covenants about the State not changing their special status… So basically this all now goes to herds of lawyers and the courts for a year, then someone folds.

    So due to advocating Woke Garbage like kinders bring taught queer sex, Disney now gets AT A MINIMUM a year of legal bills into the $ Millions and likely a perpetual PITA of County inspectors, regulation, delays, and fees.

    Way to Get Woke Go Broke, Disney.

  7. philjourdan says:

    @E.M.Smith says:
    23 April 2022 at 12:07 am

    Exactly! Why I called Olbermann and the rest of the idiot liberals Morons! Disney was shrewd and clever 60 years ago. He knew what he was doing. There are 2 theme parks within 50 miles of me. Nice parks too! Except they are only open about 6 months of the year due to – WEATHER. Disney is year round. And when California shut down their parks for over a year due to the Chinese flu, Florida was only shut down a short time. So sure they could move it. And go broke!

    Get woke, go broke. Disney cannot move. They can close it. But then what are the Stock holders going to say? Massive law suits about the company violating their fiduciary responsibility! Yea, move idiots! And you will be lucky to save the company as an ongoing entity.

    Liberals just have no capacity for rational thought.

  8. another ian says:
  9. another ian says:

    Latest Pointman

    More “Get woke, go broke”

    “THE POWER OF YOUR PENNIES.”

    https://thepointman.wordpress.com/2022/04/22/the-power-of-your-pennies/

  10. Pouncer says:

    The image / citation emphasizing a line in paragraph 3 applies to INACTIVE districts. I’m sure a legal case can be made that Disney World is still active.

    Texas has similar districts. Water. Waste water. Hospitals. All sorts. I succeeded in getting a petition through the neighborhood to set up a Public Improvement District (PID) to take over an evil Homeowners’ Association. (HOA)

    When the land was undeveloped the rains would soak the prairie or the fields and slowly seep away into a nearby intermittent “Branch” of the Trinity River. When roads and driveways and rooftops were platted the city mandates the developer put in a “retention pond” that would collect rushing rain run-off and then let it slowly drain — sort of engineered artificial seepage. AND the developer had to set up some sort of mechanism to maintain the pond. City would not take this chore on. So, the HOA. There were a number of issues — one and most generally aggravatingly were the lies preached by the HOA about all the “amenities” the association provided. (We had none) But a bigger second issue was a four-times-pr year assessment that seemed designed to confuse people and put them into arrears. Then the HOA lawyers would force a title sale on the county courthouse steps. The residents would have to buy back their own homes, pay the legal fees, pay the outstanding assessments, and pay interest and penalties on the whole mess. All this was being done more or less privately, without public scrutiny, so the HOA did not even have the fig leaf of claiming these atrocities were done to encourage compliance. Then the third issue was that two-thirds of all assessments collected (on time or recovered by threat) were dedicated to the fees charged by the HOA management company. It all was a very expensive way to fund a wet hld in the ground. (By the way, the hole was very poorly maintained — not ever enough spare money to do the job right after the management fees were paid …)

    The PID, by contrast, collected a new line on the annual property tax bill. The new PID boar promised and later set the tax rate so the annual fee was very closely identical to the old HOA annual assessment. That tax was due once a year, like all other property taxes. Most homeowners with mortgages had “escrow” funds taken from the monthly payments, and the tax was automatically paid, on time, along with other city, county, school, and other special district taxes. The management company was fired. The wet hole in the ground got much overdue maintenance accomplished. And five year plans were laid to reduce the tax rate in coming years to reflect the reduced expenses. (No legal fees. No management fees. )

    Well, the board members were term limited by city charter. A new board was installed. (City council appoints those members, they’re not elected.) And the five year plan was — revised …

    ANYHOW. Already too long. The POINT is that special districts are like any other organizing instrument for social purposes. Better than some. Worse than some. Subject to the whims of those in charge.

    I don’t suppose Disney was funneling commercial profits, that might otherwise have gone to shareholders, into the roads and fire stations of their District. I do suppose they taxed THEMSELVES to do so, and then wrote off those SALT-like taxes as a deduction on their federal income tax. Assuming the county property valuation and tax rate is the same with or without the district, the only reason I can see that the roads might suffer is if Disney (and their high priced Lawyers) suddenly start fighting those appraisals and tax rates where they used to not.

  11. E.M.Smith says:

    @Pouncer:

    Interesting story…

    FWIW, I think the key is the 1997? Law that required some kind of recertification that, it seems, Disney did not do, therefor became legally inactive even if physically doing things.

    Given the noises about a $ Billion debt to go to counties, I suspect the gimmick being exploited was putting Disney debt off books into Reedy Creek. So deveope the whole Flamingo Crossing space (429 toll road entrance) and have all the infrastructure paid via Reedy Creek debt, then hotels and restaurants built by hotel companies, now collect rent from zero visible investment cost. ROI mathematically infinite. Similarly, rehab a section of park, put demolition, pavement, power, water street lamps and amenities, etc. Into Reedy Creek debt. Disney just covers the “ride” itself at minimal to no debt. ROI is income / ride cost; not including infrastructure changes nor debt service. No debt on the books of Disney. Then there are unknowns like: does Reedy Creek own and run the busses? Parking lots? (Or just gets all the parking lot expenses and debt while Disney operates and collects fees?)

    The opportunities for Disney books cooking are large and the debt numbers being talked up are huge enough to imply they have done it for a long time…. IFF they have, just airing that dirt will be brutal for Disney Execs.

  12. jim2 says:

    On Friday, DeSantis signed legislation to end a special municipal district Disney has operated in the state since the late 1960s. It’s part of a drive to punish the company for speaking out against a law, championed by the governor, that bans discussion of sexual orientation or gender identity in kindergarten to third-grade classrooms.

    But for now, at least, DeSantis is leaving alone another valuable perk: $578 million in credits Disney can use to reduce its state income taxes through 2040. Christina Pushaw, a spokesperson for the governor, said DeSantis hasn’t asked the legislature to repeal the tax credits because “it’s not a carve-out for a specific corporation.” Any company can apply for the incentives, she said, and “the bigger investments will qualify for the bigger tax credits.”

    https://finance.yahoo.com/news/disney-578-million-tax-break-170000800.html

  13. jim2 says:

    If anyone investigates Disney with the same intensity as Dimowits investigate Trump, the Mouse will be in the Big House.

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