Disney fights to preserve the power of its Florida kingdom

When Walt and Roy Disney hatched their plan to transform 101 square kilometers of Florida swampland into a utopian city and theme park in the mid-1960s, they didn’t want the oversight from California authorities they faced when they built Disneyland.

At the end of a highly effective public relations effort, Disney got its wish: Florida gave the company the powers to essentially run a private government. Among the extraordinary rights granted to Disney by the Florida legislature in 1967 was the ability to build a nuclear power plant and airport on the property.

Disney never built the power plant or airport near Disney World. But the company’s legal right to do so could be a useful bargaining chip as Disney tries to preserve its 55-year-old “special tax district” in Florida, known as the Reedy Creek Improvement District, which the state’s governor wants to dissolve.

This spring, Reedy Creek became an unlikely fixture in the culture wars, as Florida Governor Ron DeSantis battled Disney, whose then-chief executive Bob Chapek criticized the state law that restricts discussion of LGBTQIA+ issues in theaters. of class.

In what was generally considered retaliation for Chapek’s criticism of critics of the “Don’t Say Gay” legislation, DeSantis signed a hastily drafted bill that would schedule the dissolution of Reedy Creek in June.

The governor’s office did not explain what would replace him, although a spokesperson for DeSantis said in a statement on Friday that “there is a plan in place that will be released shortly.”

However, there are concerns that the costs of assuming Reedy Creek’s responsibilities — which include water and power supply, roads and fire services, all paid for by a tax Disney collects on itself — will fall on Florida taxpayers. .

Similar fears surround the fate of its nearly $1 billion municipal debt, which was downgraded by Fitch after the law was signed.

Richard Foglesong, a historian and political scientist at Rollins College, says Florida’s law is clear: the tax paid by Disney would fall on residents of nearby Orange and Osceola counties if Reedy Creek disappeared. “This isn’t going to work,” he said. “It will be revoked and forgotten.”

A spokesperson for DeSantis said in the statement that “Disney’s debts will not fall on Florida taxpayers.”

But worried Florida lawmakers are discussing a plan to create a “successor” bill that would replace the law DeSantis signed less than eight months ago. The goal, they say, would be to preserve Disney’s special tax status while reducing the company’s power enough to satisfy DeSantis.

“Somehow they have to get the onus on Disney and keep the ability to tax itself,” says Foglesong, author of “Married to the Mouse.” [Casada com o rato], a story of Disney in Florida. “Who would want to pay the price of building [e manter] this amazing theme park?”

A focus of the lawmakers’ discussions can be found on page 295 of the 1967 law that gave Disney the sweeping powers it has wielded for 50 years. Under the law, the company has the right to build and operate “factories and facilities for the generation and transmission of energy through nuclear fission and other new and experimental sources of energy.”

At the time, nuclear power was on the rise and it fit with the Disney vision of building a city of the future. But the company never put the idea into practice. Now, however, some Florida politicians see it as part of a possible solution to the Reedy Creek dilemma.

Linda Stewart, a Democratic senator whose district includes parts of Orlando, told the Financial Times that depriving Disney of the ability to build a nuclear power plant or an airport could be part of a new replacement bill — in addition to allowing the governor to nominate two members. of Reedy Creek Council.

“I don’t care that they can’t build a nuclear power plant,” she said. “It’s fine by me.”

A key question is whether stopping Disney from investing in infrastructure it doesn’t intend to build will be enough for DeSantis, whose decisive re-election in November made him a frontrunner in the race for the 2024 Republican presidential nomination. give way” over Reedy Creek, Stewart said. “He’s going to have to get something out of it.”

Another potential factor is Disney’s firing last month of Chapek, who had been the subject of DeSantis’ scorn.

DeSantis became a conservative hero this year for labeling Disney a “conscious” company, while Chapek was accused by Disney employees – including LGBTQ workers at Disney World who were angered by Florida’s education law – for mishandling the issue. .

But Bob Iger, who ran Disney for 15 years and returned as CEO for the next two years, is known for his deft political touch. This week, Iger told officials he was “sorry to see us dragged into battle” for Reedy Creek, adding that “the State of Florida has been important to us for a long time and we’ve been very important to the State of Florida.”

Randy Fine, a Republican congressman who co-sponsored the Reedy Creek bill, told the Financial Times this week that Iger’s return to Disney should increase the chances that “something will work out”.

However, DeSantis hardly sounded conciliatory this week when asked on Fox News about Iger’s comments. “Yes, they are a big and powerful company, but we defend our people,” said the governor. “I don’t care what a Burbank-based company [Califórnia] say about our laws.”

In addition to its position as Florida’s largest employer, Disney still has several cards to play — chief among them is its reputation for operating the park complex to a high standard. Reedy Creek’s five-member technocratic council has few residents to report to, allowing it to make decisions quickly. “It’s better than [a Disney] manage,” says Foglesong. “They believe in expertise.”

At a recent board meeting, a Reedy Creek official noted that the district produces more solar energy than any other local government in the state — with the help of a series of panels called Mickey — thanks in part to clean energy goals set. by Disney.

Anna Eskamani, a progressive Democratic representative who represents Orlando in the Florida House, is a frequent critic of Disney but agrees that it would be difficult for the public sector to uphold Reedy Creek standards. She notes that in addition to paying property taxes, Disney taxes itself at a higher rate than nearby counties are allowed to charge.

“When you go to Disney, there are no mosquitoes, because they have intensive mosquito control”, she points out as an example of Disney’s competence. “Orange County couldn’t do what Reedy Creek does.”

It’s an argument Walt and Roy Disney might as well have made.

Translated by Luiz Roberto M. Gonçalves