Florida’s Republican-controlled House of Representatives voted to dismantle Walt Disney Co’s (NYSE:DIS) self-governing special district.
What Happened: In a 68-38 vote, the House passed the measure advocated by Florida Gov. Ron DeSantis, who called on the legislature to bring about the “termination of all special districts that were enacted in Florida prior to 1968, and that includes the Reedy Creek Improvement District.” The Florida Senate passed the bill yesterday in a 23-16 vote.
The Reedy Creek Improvement District functions as a county government and covers roughly 39 square miles that includes the cities of Bay Lake and Lake Buena Vista plus the unincorporated land within its parameters. It was created in 1967 at the insistence of Walt Disney when was planning to create his Florida theme parks. Disney believed the company could operate more efficiently with full autonomy rather than be under the supervision of county governments.
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What Happens Next: The bill will go to DeSantis for his signature. A date for the ceremony to sign the legislature into law has yet to be scheduled.
DeSantis, who is running for re-election this year and has been touted by many political observers as a potential candidate for the 2024 Republican nomination for president, took umbrage with Disney’s support of the state’s so-called “Don’t Say Gay” legislation that prohibits schools from teaching lessons on sexual identity and orientation to students in kindergarten through the third grade. DeSantis has gained support among many conservatives for rallying against Disney.
"Disney and other woke corporations won't get away with peddling their unchecked pressure campaigns any longer," said DeSantis in a fundraising letter released earlier this week. "If we want to keep the Democrat machine and their corporate lapdogs accountable, we have to stand together now."
If Disney opts not to challenge the new law in court, Reedy Creek would cease to exist on June 1, 2023, with its functions and expenses absorbed by Orange and Osceola counties. Orange County Tax Collector Scott Randolph told the Associated Press this would put a massive burden on his county’s government.
"Being fire fighting, wastewater, power, street maintenance, road maintenance, all that with zero additional revenue," Randolph said, noting that Orange County would also inherit the district’s $58 million in loan obligations – a sum that was not anticipated in the county’s current budget.
"This will be a huge property tax increase for the rest of the citizens of Orange County. Probably 20%," Randolph said.
DIS Price Action: Disney's stock is trading down 2% to $122.08 at press time.
Photo: Tony Takitani / Flickr Creative Commons
