For more than half a century, when the “magical” world of Disney was developing in Florida, said state of EE.UU. granted the company a “special condition” of government own.
Over its territory, which comprises some 100 square kilometers, the company has the same powers as any other Floridian county.
How many taxes are charged, how they are invested, security and even the direction of two cities are the decision of Walt Disney World Resort.
The area, where the company’s theme parks, hotels and other recreational facilities are built, is called The Reedy Creek Improvement District (RCID) or “excise district.”
However, this “special status” is threatened following a series of clashes between the company and the state governor, the Republican Ron DeSantis.
Disney executives have voiced opposition to a controversial law passed in Florida that prohibits discussing sexual orientation and gender identity in elementary schools.
Dubbed by critics the Don’t Say Gay Act, the measure allows parents to sue school districts if any educator violates its provisions.
In retaliation, the president, who is being talked regarding as a possible candidate for the White House in 2024, urged the state legislature dominated by his party on Tuesday to reverse the company’s “self-government” formula.
DeSantis’s expressions brought to the public spotlight the RCID grant, a provision unknown to many and one that is largely related to the success of Disney’s business.
Why was the RCID created?
In the mid-1960s, following the popularity of Disneyland in California, the creator of this entertainment empire, Walt Disney, began planning a second theme park, but this time on the east coast of the country.
At the time, central Florida, where Orange and Osceola counties are located, was in full swing, with new roads and a major expressway being built near an airport.
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Disney saw a great opportunity to establish its project in the area and bought thousands of hectares which, according to the RCID’s own website, at that time represented a group of uncultivated and swampy lands, without basic service infrastructure.
In 1967 the state legislature created RCID, allowing the entertainment giant to build its massive complex outside the regulatory framework of adjacent countiesbut on the condition that it take responsibility for its development without government investment.
How does RCID work?
The special district is made up of the theme parks and the cities of Lake Buena Vista and Bay Lake. Within its limits there are 19 “land owners”, including Disney and its subsidiaries.
The company must deal with issues as diverse as power generation and distribution, regulating building codes, as well as police, emergency medical, and firefighting.
RCID finances its operations through taxes, owner and tenant fees, utility revenues, and bond issues.
A five-member board of supervisors elected by the owners governs the area.
In addition, the district has intergovernmental agreements to handle policing and the judicial system.
Why is he threatened by DeSantis?
The “Don’t Say Gay” law was proposed by the Republican majority in the state legislature and signed by DeSantis on March 28.
Disney, pressured by its employees, who staged protests while the project was being discussed and sent letters to their directors, announced that it will withdraw political donations to the Republican Party in Florida.
He also stated that his goal as a company is for the legislation to be overturned or defeated in court.
“Our employees see the power of this great company as an opportunity to do good. I agree,” said the CEO of Disney, Bob Chapek, in statements to the US media Politico.
Chapek also apologized because the company initially avoided expressing itself regarding the project.
According to Politico, Disney’s donations to Republicans in the 2020 election cycle totaled $913 million, while the direct contribution to DeSantis was $50,000.
In the midst of the controversy, the exchanges between the company and the chief executive of Florida have not ceased. Even the president indicated, following Chapek’s expressions, that Disney “exceeded the line.”
But the situation escalated to such a degree that the state legislature is now considering a law to remove the RCID and five other special tax districts.
The Florida legislature is holding a special session this week in which it is evaluating changes to its electoral districts.
DeSantis said at a news conference Tuesday that he would amend the agenda to include the proposal once morest Disney.
“I announce that we are expanding the call for what they are going to consider this week,” he said.
“Yes, they will consider congressional maps, but they will also consider terminating all special districts that were enacted in Florida prior to 1968, and that includes Reedy Creek,” he added.
The bill might be approved on Friday, members of the state legislature said, and the repeal of the RCID would occur in June 2023.
What would happen if the RCID is reversed?
Jenniffer Bradley, a state senator from the Republican Party and a supporter of the bill, told multiple outlets Tuesday that special tax districts will have to cede their powers to the counties in which their territories are located if the proposal passes.
In addition, they will have the opportunity to lobby the legislature for the decision to be reversed.
However, neither DeSantis nor the lawmakers have offered more details regarding what would happen if RCID status ends.
According to US media, the local governments where they operate would have to bear the infrastructure costs, which in the case of Disney represents billions of dollars.
It would also pose an administrative and regulatory challenge due to the reality of the company as a tourist area that receives millions of visitors annually.
What impact it would have for the company, which employs regarding 70,000 people, is also unclear.
At this time, Osceola and Orage counties have not issued opinions on the initiative, nor has Walt Disney World.