There’s a massive question mark in Disney World’s future.
No, it doesn’t have to do with the new lands teased for the parks, the transformations going on in places like EPCOT and Magic Kingdom, or even potential changes to the Park Pass system. No, an even bigger part of Disney World — critical to the way the Company has operated for the past 50 years in Florida — is at risk of seriously changing.
What’s Going On?
Following Disney’s stronger statements against the Florida Parental Rights in Education bill (what critics call the “Don’t Say Gay” bill), Florida legislators passed a bill that will dissolve Disney’s Reedy Creek Improvement District (RCID or the “District”) in 2023. Florida Governor Ron DeSantis later signed this bill into law. The law was signed in 2022.
What is the RCID, you ask? Good question. The RCID was created in 1967 by a special act of the Florida legislature. It covers the land on which Disney operates its Resort (theme parks, hotels, etc.) in Orlando. Essentially, the District functions as its own county government in Florida. It is responsible for various things within the District, including:
- overseeing land use and environmental protections within the District
- providing essential public services to the land within the district (like fire protection, emergency medical services, wastewater services, solid waste collection and disposal, and more)
- regulating the EPCOT Building Code
- operating and maintaining all public roadways and bridges
It also has the power to assess taxes and fees and issue bonds.
The District is governed by a Board of Supervisors. The Board of Supervisors is elected by the landowners in the District. Disney is the majority landowner in the RCID, which means this arrangement gives Disney a HUGE amount of control over the land on which it operates in Orlando.
That has benefitted Disney greatly in allowing them to pass regulations other counties may not have approved (like the EPCOT Building Codes, which provide for innovative methods in design; or the use of fiberglass on Cinderella Castle), and allowing them to make critical decisions for the land on which they are located.
The arrangement has also benefitted local counties — they have gotten the advantage of Disney’s growth and the influx of tourists, while also NOT being responsible (financially or decision-wise) for key services within the District (like the emergency medical services, etc.).
But all of this could be coming to an end soon due to the legislation passed by the Florida legislature and signed by the Florida Governor. Some have referred to the state’s action in dissolving the RCID as essentially an act of retaliation against Disney for speaking up against the Don’t Say Gay bill.
Others have framed this more as being an issue about a big company reportedly having “special exemptions” from rules and regulations or otherwise being treated in a “special” manner as compared to other corporations in the state.
Whatever the reasoning, Disney’s future could look VERY different if the RCID really goes away.
How important is Disney’s relationship with DeSantis for the future of the parks? Click here to find out.
Why Is June 1st Important?
June 1st is critical to the RCID drama. Why? Well, the law passed that will dissolve the RCID didn’t dissolve the RCID right away. Instead, according to the law, the effective date of the RCID’s dissolution is not until June 1st, 2023. The RCID is still in effect as of this moment and won’t dissolve officially until then. Disney (and the state) has until June 1st to figure out what the next steps are for the RCID.
The law does provide that the districts could be reestablished or other steps can be taken, so there is a little wiggle room here. But if Disney or the state wants to establish a NEW district for this area before the dissolution date, time is running out.
It’s important that Disney and the state come up with a solution (if at all possible) before the dissolution date for many reasons. From Disney’s perspective, knowing what the next several years will look like is critical. Will there be a new district that’ll essentially be the same as the RCID with perhaps a few powers removed? Will there be a new district with a board member appointed by the Governor to give him some oversight? Will an entirely new district totally controlled by the state be utilized?
Will local counties simply have to absorb the RCID’s responsibilities? If so, that’ll leave Disney to work with two districts since its land technically spans part of Orange County and part of Osceola County. Knowing who they’ll have to deal with for future services, land use regulations, and more is key.
But it’s also critical from the state’s perspective to know what will happen if the RCID is officially dissolved. Many have raised concerns that the RCID’s dissolution will cause the District’s $1 BILLION in outstanding bonds to become the burden of local taxpayers. Plus, if local counties must absorb the land within the District and handle all services for it (waste services, emergency services, etc.) that could cause an additional strain on their budgets. Some fear this will lead to a rise in taxes for local taxpayers in those counties.
As WFTV 9 points out, Disney still “pays the same property taxes levied by the government and the school district that every other landowner pays.” To pay for its own fire and sewer departments, the RCID has levied an additional tax on itself for those services. Once that District goes away, so does this additional tax, leaving (likely) Osceola and Orange County to pick up the cost and their residents could feel the financial impact in the form of more taxes.
Tax Collector Scott Randolph previously stated, “I don’t see how Orange County doesn’t raise property taxes by 20% to 25%…That’s what [the county] would probably have to do to cover this financial situation.”
Orange County Mayor Demings, however, has said that “Any statements made by state officials to suggest that Orange County would use the dissolution of the Reedy Creek Improvement District as a pretext to raise taxes on its residents is reprehensive and baseless.” (Orlando Business Journal)
DeSantis’ office has similarly indicated that they intend to put a plan in place that would keep Disney responsible for its own debts and bond obligations, and ensure that the dissolution does not cause tax increases to Florida residents.
Click here to see what big steps Disney has taken forward future parks amid the Reedy Creek drama
What Happens Next?
So where do we go from here? Well, the future is unclear. Here are just some of the suggestions that have been made by various groups:
- The dissolution date could be delayed to give everyone more time to set forth a plan for the future
- Instead of dissolving the RCID, the state could just amend some of the bigger powers the RCID has (like the ability to build a nuclear power plant)
- State or local governments could change the wording of the RCID charter or replace it
- A new district could be created that is controlled by the state
- A new district could be created that still gives Disney most of the same powers they had under the RCID, with some adjustments (like the removal of that power to create a nuclear power plant)
- A new district could be created that gives Disney many powers, but places a governor-appointed member on the Board of Supervisors, so as to give the Governor more power over the District
Some, including the very sponsor of the bill that will dissolve the RCID, felt that Bob Chapek’s exit from the CEO role and Bob Iger’s return could smooth things over. Randy Fine (the bill’s sponsor) even noted, “Chapek screwed up, but Bob Iger doesn’t have to own that screw-up.”
But DeSantis isn’t backing down. His office indicated that DeSantis won’t be doing any kind of “u-turn” on this issue. Instead, DeSantis has filed a public notice on the Osceola County website of future legislation he/his office intends to get. It gives us a somewhat clearer look into the future.
The filing indicated that DeSantis has an intent to “seek legislation before the Florida Legislature…of an act relating to the Reedy Creek Improvement District, Orange and Osceola Counties.” The primary goal of the legislation is to increase “state oversight, accountability, and transparency of the District.”
Here are some of the things the notice says the legislation could seek to do:
- Revise “the selection process, membership qualifications, and compensation for the governing body of the District“
- Ensure “debts and bond obligations held by the District remain with the District and are not transferred to other governments by retaining the District’s authority related to indebtedness and taxation”
- Revise authority when it comes to local permitting and regulation
- Revise the regulatory framework and structure
- Review the district’s remaining powers and revise “exceptions to general law and certain special acts”
- Describe the district boundaries and name
- Set a date on which these policies will go into effect
DeSantis’ Communications Director Taryn Fenske issued a prepared statement that said “The corporate kingdom has come to an end.” The statement also noted, “Under the proposed legislation, Disney will no longer control its own government, will live under the same laws as everyone else, will be responsible for their outstanding debts, and will pay their fair share of taxes. Imposing a state-controlled board will also ensure that Orange County cannot use this issue as a pretext to raise taxes on Orange County residents.”
Again, Disney does pay taxes, but it seems the “no longer control its own government” language is key here.
Interestingly, Professor Aubrey Jewett (an assistant school director and associate professor in the School of Politics, Security, and International Affairs at the University of Central Florida) once noted that because Disney is the sole landowner in the district, they’d have to agree to new terms, at least as it relates to some part of a replacement district. So they may have some leverage — just how much remains to be seen. (WFTV 9)
The next “regular” session for the Florida legislature starts on March 7th, 2023. A special session before that could potentially give us some news. What will replace the RCID? How might the state exercise control over the District? What tax burden, if any, will fall on local taxpayers? We’ll have to wait and see. But with June 1st quickly approaching, we have a feeling some critical updates could be on the way.
Be sure to stay tuned for the latest information.
Click here to see the latest updates on the RCID and why one person said “The Corporate Kingdom Has Come to an End”
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What do you think will happen with the RCID? Tell us in the comments.
Tracy Jones says
They didn’t “speak up against” an anti-gay bill. The bill was to prevent teachers from discussing ANY type of sexuality with CHILDREN. It was an anti-grooming bill and the opposition to it did nothing but lie and mischaracterize it because their position was indefensible. Teachers have no business discussing sexuality with children, period. Disney was dead wrong on this and is paying the price of inserting themselves into a political fight.
Nowhere Here says
That’s rich a state controlling a private business. The bill criminalizes even the acknowledgment of LGBTQ at schools. What has Florida come to.
Florida is frankly a joke. DeSantis and the republicans are an embarrassment, the rest of the world looks on in horror at what they are doing.
If it wasnt for Disney World most of Europe would never visit Florida.
Has DeSantis ever been to Disney World? Did he have a bad experience there that has made him a Disney hater? Sounds like regardless of Disneys response to the law, he wanted to go after Disney. Silly when it’s one of the biggest employers in Florida……
I know it won’t happen but who would have thought that Texas would be a better state to have WDW than Florida. I do not know what leverage Disney has, but it sounds like DeSantis wants to change just enough that Disney might accept it then he can claim victory to rally his supporters. I hope they use all of their leverage to make him blink. As I said, they cannot leave Florida, but if they could that would be hilarious. Make DeSantis the idiot that killed the goose that lays the golden eggs.
Descant is needs to back down and leave things as they were. Imagine all of the responsibility that would be transferred from Disney to the county. All of the corruption that will go along with it. Right now the state has a turn key deal to help support the growth of the central Florida region, with- little cost or headachaes. Keep in mind, the general rule of thumb is that anything that the government touches costs the consumer more than the free market. Central Florida was a swamp before Disney got here… now it is a paradise from Daytona to Tampa, where would we be without Disney pumping billions into the infastructure and drawing in tens of thousands to the workforce. Another chance for the government to mess things up that was working fine.
Whether one agrees or not with the bill, we as a people, have freedom of speech. If that is the sole reason for Governor Desantis ‘ retaliation, then I feel he overstepped his authority.
The info in your article about Reedy Creek is so informative. Thank you for it. I live in Polk County just over the border of Oceola. I also work at WDW and do worry about the whole thing. The only thing I found wrong in the article was it says Major Demings. It Mayor Demings. Sorry I have a bad habit of finding auto correct errors.
It looks like Florida has come to…well, Florida. This will be interesting, after all what has Disney done for
Florida? It’s possible that Disney may have some influence with national voters when the presidential election comes around. Don’t tell DeSantis..he hasn’t thought of that yet.
This is so silly. The only thing to change is the district board is appointed by the state. The district still works like it did before…Disney pays extra taxes to the district for infrastructure upkeep and Disney keeps its bond debt. If ANY thing changed with the district operation it would cause big property tax increases for those 2 counties. The new board really can’t tell the district what to do with the infrastructure taxes(paid to the district; not property taxes paid to the state of Florida)because it is Disney’s taxes to a district not taxpayer taxes to the state of Florida.
Good I absolutely agree with the governor’s doing!
Seriously, this is a violation of Disney’s First Amendment rights–smh!!
DeSantis is a bully, and this will be tied up in courts for years if he tries to make this change. Not to mention the cost of rewriting all of these laws and regulations and the cost of all of the litigation to come. If I was a taxpayer in Florida, I would be very angry. But on the other hand, maybe they deserve it?
Be Nice says
Okay since my last comment never got approved it looks like only negative Desantis comments are allowed?
Desantis has every right to pass bills that in the state he is the governor! This bill had nothing to do with Disney and the way they do business. If Desantis is so bad, then the people of Florida should have voted him out! Gee that didn’t happen I wonder why?
DFB Gigi says
When comments are not approved it is for a number of reasons including, but not limited to insensitivity, inaccuracy, language, etc. All comments must be linguistically appropriate for a wide audience, and generally not inflammatory or an attack on other commenters. Thanks!
This all boils down to Chapek’s horrible Leadership skills. The Florida bill was aimed at protecting children and supported by most of Florida. Chapek could have easily “supported” his LGBQT workforce without condemning the bill or criticizing Florida’s Governor. His response was poorly considered and has hurt Disney, and possibly the citizens of Orange and Osceola County. Disney should stick to their original agenda of providing a wholesome and enjoyable family experience, and stay out of politics and pandering.