Editorial: Disney ‘punishment’ could blow up in DeSantis’ face

The Facebook post from last Saturday is comedy gold. A man in a DeSantis 2020 hat topped with a mouse-ear headband poses in front of a few cars with their hoods up. The caption: “Patriot Convoy just did a BLOCKADE @ the Entrance of Disney. Car Trouble. No one visiting Disney can get in.”

A few people took the man seriously, scolding him for spoiling family vacations. Others realized, almost immediately, that the “blockade” was on a back-property access road near the Disney Springs shopping complex. A few miles away, folks were getting in and out of Disney theme parks just fine. The man, and the small group of people he convinced to follow him, looked silly. The gajillion-dollar corporation they were trying to harass looked oblivious.

That vignette might have been a little preview of the ridiculous exhibition Gov. Ron DeSantis himself led a few days later. With no advance notice, DeSantis demanded that lawmakers punish Disney for its tepid criticism of a hateful bill aimed at banning discussion of sexual orientation or gender identity in Florida classrooms (also, for Disney’s threat to cut off campaign contributions).

But when the governor roared, the Mouse yawned. The company with nearly 40 registered lobbyists didn’t send a soul to indecently rushed committee meetings convened to dole out punishment.

And as the dust settles, many suspect that Disney’s “punishment” could let the company pocket tens of millions of dollars each year and shift a billion-dollar debt onto the shoulders of local taxpayers. That would leave DeSantis and lawmakers looking as foolish as those “Patriot Convoy” blockaders, responsible for one of the biggest financial blunders in Florida’s history

Magic Kingdom, special district

DeSantis targeted two favors: One, a provision that exempts Disney from a law meant to annoy social-media companies, was only notable for the way DeSantis and lawmakers eagerly scampered to protect Disney in the 2021 session, only to childishly yank back the carve-out in 2022.

But the other seemed like a really big deal. Lawmakers passed a bill (SB 4C) that abolishes a key component of Disney’s successful 50-year run in Florida.

Disney, as it turns out, has its own government. In fact, it has three: Two cities — Bay Lake and Lake Buena Vista, combined population a little more than 50 — and the Reedy Creek Improvement District, which wraps around Disney’s iconic theme parks and resorts along with thousands of vacant acres in Orange and Osceola counties. Reedy Creek was created by the Legislature in 1967, soon after Disney announced its Florida venture.

Since then, many — including this newspaper — have questioned whether it was a good idea to give Disney so much power, most of which is wielded through the Reedy Creek district. We’d welcome a thoughtful review of the district’s powers and operations.

That’s not what this is. Even the lawmakers sponsoring the legislation couldn’t say exactly how it would work.

There’s a lot to consider. Reedy Creek issues Disney’s permits, operates its utilities including water, sewer and electric; and levies a hefty property tax that pays for the services Disney needs.

That last one might seem outrageous. The Reedy Creek district covers 25,000 acres, and collected $164 million in property taxes in 2022. That’s a lot of money for a private corporation to seize, under the power of government.

But who is Disney taking that money from?

At it turns out: Disney. Disney and its affiliates contribute 87 percent of the district’s tax revenue.

That makes sense, says Professor Rick Foglesong of Rollins College, who wrote “Married to the Mouse,” a political history of Disney’s creation. When the Reedy Creek district was created, it wasn’t really about money: Walt Disney and other executives were sick of bending to the whims of city officials in Anaheim, California as they built and operated Disneyland. “They wanted a government that was tailored to their precise needs,” he said.

For 55 years, the Reedy Creek district has been operating as intended. Today it employs nearly 400 people, more than half of them firefighters. It also has a surprisingly large permitting operation, including the kind of building inspectors who are comfortable signing off on the structural integrity of a 5.7 million gallon fish tank or a restaurant with a giant singing tree in the middle.

That built-for-Disney government is what DeSantis ordered his pet legislators to destroy. Under HB 4C, the Reedy Creek Improvement District will go bibbity-bobbity-boom in June 2023.

What happens next

The bill was designed to create chaos — and it did. It was also probably intended to distract attention from lawmakers’ other task: Kowtow to DeSantis’ demands and pass a shockingly racist plan to redraw the state’s congressional districts.

It did that too.

But after a few days poking around, this bill doesn’t look nearly as disastrous for Disney as DeSantis intended.

Start with that $164 million in property taxes, which funds most of the district’s $178 million operating budget. If the district goes away, so does its taxing authority. Who picks up the tab?

That’s really not clear. Rep. Randy Fine, R-Palm Bay and House sponsor of the spank-Disney legislation, theorized that most of the district’s responsibilities and assets might, maybe, possibly, trickle down to the cities of Bay Lake and Lake Buena Vista. Which are still controlled by Disney, and have taxing authority.

But that leaves thousands of acres outside those two cities’ limits. In that case, a portion of the burden will fall on Osceola County, but most of it will land on Orange County. Assuming those costs could be disastrous, County Mayor Jerry Demings told the Sentinel.

Then there’s the Reedy Creek district’s debt, which we estimate at $977 million, with about $100 million more in liabilities for the district’s pension program and other promised benefits. That’s a lot. Who’s responsible for paying it? Fine guessed the counties might be responsible — but bond documents suggest the state itself could be held responsible for triggering default.

Remember, all this — the annual budget, the debt, the building inspectors and firefighters (and their pensions) were designed to be covered by Disney’s tax payments. Taxes that, after June 2023, nobody will have the authority to collect.

Lawmakers dangled the possibility of re-authorizing the district in 2023. It seems unlikely that Disney is going to wait 10 months for the opportunity to beg lawmakers to relents. The company has options: Greatly expanding the boundaries of the cities it controls, or striking a local deal with Orange and Osceola counties. Either option would be more tamper-resistant to hot-headed lawmakers.

The entire sorry saga puts us in mind of another story — from a film banished from Disney’s back catalog because of racist elements, something DeSantis would probably sneer at as “woke.” It’s the tale of a foul-tempered fox who thought he had the upper hand on a wily rabbit, only to find himself outsmarted when the hare made a thorny escape. That inspires a suggestion: If Disney and local leaders decide to build a solution to the mess DeSantis and legislators created, they can leave the Reedy Creek name behind.

The Briar Patch Improvement District? We can see that.

____

The Orlando Sentinel Editorial Board consists of Opinion Editor Krys Fluker, Editor-in-Chief Julie Anderson, Viewpoints Editor Jay Reddick and El Sentinel Editor Jennifer A. Marcial Ocasio. Contact us at insight@orlandosentinel.com

____