(CNN) — Disney’s special charter district, Reedy Creek Improvement District, says Florida’s decision to dissolve it next year is not legal unless the state pays off Reedy Creek’s large debts.
Reedy Creek is a special purpose district created by state law in May 1967 giving The Walt Disney Company extensive government control over its theme park lands in and around central Florida. With that power, Reedy Creek currently has regarding $1 billion in outstanding bond debt, according to the credit rating agency Fitch Ratings.
In a statement issued to its bondholders last Thursday, Reedy Creek noted that the 1967 law also includes a commitment from Florida to its bondholders. The law states that Florida “shall not in any way affect the rights or remedies of the holders…until all such bonds, together with interest thereon, and all costs and expenses in connection with any act or proceeding on the part of such holders or on their behalf, are fully satisfied and liquidated”.
Because of that promise, Reedy Creek said it looks forward to continuing business as usual.
“In light of the State of Florida’s promise to the District’s bondholders, Reedy Creek looks forward to exploring its options as it continues its current operations, including the imposition and collection of its ad valorem taxes and the collection of its service revenues. services, the payment of debt service on its ad valorem tax bonds and utility revenue bonds, the performance of its bond covenants, and the operation and maintenance of its properties,” Reedy Creek said.
CNN has reached out to Gov. Ron DeSantis’ office for comment on the Reedy Creek declaration.
The statement, published in the Municipal Securities Regulation Board, it represents the first response from the Disney-administered district since Florida Republicans passed legislation that will dissolve the special-purpose district on June 1, 2023. DeSantis signed the legislation into law Friday. Disney has not made any public statement regarding the law.
The new law is just two pages long and avoids any discussion of the details of undoing half a century of infrastructure deals, nor does it lay out the next steps in the complicated process. Lawmakers from neighboring Orange and Osceola counties have raised concerns that they will have to pay Reedy Creek’s debts and will have to significantly increase residents’ property taxes.
“If we were to take on the first responder, the public safety components for Reedy Creek, without new revenue, that would be catastrophic for our budget here within Orange County,” Orange County Mayor Jerry L. Demings, on April 21, before the official vote of the legislature that day. “It would be an undue burden on the rest of the taxpayers in Orange County to fill that gap.”
The Florida-DIsney Conflict: How We Got Here
Disney, with 75,000 employees, is the largest single-site employer in Florida and a key driver of the state’s vital tourism business. However, state officials took over the company’s self-governing status as a form of retaliation for Disney’s criticism of a law restricting discussion of LGBTQ issues in schools.
The law, titled “Parental Rights in Education” and labeled by critics as the “Don’t Say Gay” bill, prohibits schools from teaching children regarding sexual orientation or gender identity “in a that is not age or developmentally appropriate. The legislation also allows parents to file lawsuits once morest a school district for possible violations.
The vague language of the law and the threat of lawsuits from parents have raised fears that it will lead to discrimination once morest LGBTQ students and have a chilling effect on classroom discussion. DeSantis spokeswoman Christina Pushaw, however, said the legislation would protect children from “groomers,” a slang term for pedophiles, and described those who oppose the law as “probably groomers.”
Disney CEO Bob Chapek initially refused to condemn the law, but changed course following facing criticism from employees. A company spokesman issued a statement last month saying his goal is to have the law struck down by the legislature or struck down in court.
“Florida’s bill HB 1557, also known as the ‘Don’t Say Gay’ bill, should never have been passed and should never have been signed into law,” the statement said. The company said it was “dedicated to defending the rights and safety of LGBTQ+ members of the Disney family, as well as the LGBTQ+ community in Florida and across the country.”
Earlier last week, DeSantis challenged lawmakers to unravel the 55-year-old Reedy Creek Improvement Act as part of a special legislative session. The impact of that legislation, as well as its legality, remains unclear.
