Florida governor signs bill that strips Disney of special tax status after company criticized "Don't Say Gay" law

Florida Gov. Ron DeSantis has signed into law a bill to dissolve a private government controlled by Disney that provides municipal-like services for its 27,000 acres in the Sunshine State. The new law is largely seen as retribution for Disney's criticism of a new state law that critics have dubbed "Don't Say Gay," which bars instruction on sexual orientation and gender identity in kindergarten through third grade. The entertainment giant has not commented publicly on the proposal to dissolve its government, which has been in operation for 55 years. The bill, which the Legislature passed on Thursday and DeSantis signed into law on Friday, would eliminate the Reedy Creek Improvement District, as the Disney government is known, as well as a handful of other similar districts by June 2023. The measure does allow for the districts to be reestablished, leaving an avenue for Disney and lawmakers to renegotiate their deal between now and June 2023. "By doing it this early, we have until next June or July to this put together, so we're actually giving ourselves more time to be thoughtful," said Republican Senate President Wilton Simpson. "I don't know how the end will come, but I know that this is a very worthy process that we're taking and I think whatever comes out of it will be better than what we have today."

Although details are far from clear, the proposal could have huge tax implications for Disney. Democratic state lawmakers who oppose the bill also have warned that it could result in homeowners getting hit with big tax bills if they have to absorb costs the company used to pay. Orange County Mayor Jerry Demings, whose county is partially home to Disney World, said it would be "catastrophic for our budget" if the county had to assume the costs for public safety at the theme park resort. Reedy Creek currently reimburses the Orange County Sheriff's Office for public safety costs. "If that district goes away, and they no longer pay for those public safety costs, and it then has to fall to the county's other budgets, that is a net sum loss to the rest of the taxpayers of Orange County," Demings said.  The company sold the idea to Florida lawmakers in 1967 as part of its plans to build an expansive East Coast theme park that would include a futuristic city. The city never materialized, but Walt Disney World nevertheless became an entertainment juggernaut in Orlando, while still retaining governmental powers that have allowed it to decide what and how to build and to issue bonds and provide services such as zoning, fire protection and utilities. The Reedy Creek Improvement District has been allowed to build its own roads, run its own wastewater treatment plants, operate its own fire department, set its own building codes and inspect Disney buildings for safety. The district had $169 million in revenues and $178 million in expenditures in the current budget year.

Disney is a major political player in Florida, as well as the rest of the country. The Walt Disney Co. and its affiliates made more than $20 million in political contributions to both Republicans and Democrats in the 2020 campaign cycle, the most recent year for which figures are available, according to the Center for Responsive Politics, which tracks such spending.