The Florida Senate voted Wednesday to end Disney’s special taxing district in a battle over the state’s new sex education law, pushing the theme park giant a step closer to losing the unique autonomy it has functioned under since the park was built more than five decades ago.
The Republican-led Senate voted to end the Reedy Creek Improvement District just one day after Gov. Ron DeSantis, a Republican, announced he was calling on the Legislature, meeting this week in a special session, to take up a measure.
The Republican-led House is expected to pass the bill Thursday and send it to Mr. DeSantis for his signature.
Disney is in a public battle with the governor over the state’s Parental Rights in Education law, which prohibits sex education in early elementary school. Critics call it the “Don’t Say Gay” bill. Disney executives, under pressure from park employees and other opponents, urged Mr. DeSantis not to sign it. When the bill became law, Disney responded by pledging to end contributions to Florida political candidates.
The bill approved by the state Senate on Wednesday specifically targets Disney’s one-of-a-kind special taxing and governing district approved in 1967 at the behest of Walt Disney, who sought independence from state and local governance to build and expand his theme park empire in Central Florida.
Although the government has authorized many special districts elsewhere in the state, none is controlled by a company.
Disney’s Reedy Creek Improvement District, controlled entirely by the theme park, has special autonomy and authority over 39 square miles in Orange and Osceola counties. The district includes the Disney theme parks and resorts as well as the Downtown Disney shopping area and surrounding hotels. It encompasses the cities of Bay Lake and Lake Buena Vista, where about four dozen residents hand-picked by Disney live and vote on matters related to the park and district.
Ending the special taxing district would subject Disney to Osceola and Orange County planning and zoning laws, as well as building inspections, for the first time.
The park also would lose its tax and fee exemption as an improvement district when it expands or builds on the property.
The legislation would put the two counties and two incorporated cities in charge of the district’s 137 miles of roadway, a fire department and $1 billion in municipal debt held by the company.
The change would not take effect until next year, and the Legislature could vote to reconstitute the special district.
“Let’s call this what it is,” said Sen. Gary Farmer, a Democrat. “It’s the punitive, petulant, political payback to a corporation that dared to say the emperor has no clothes. But if they behave this next election cycle, maybe we’ll put it all back together.”
Mr. DeSantis began to publicly question Disney‘s special status this month after accusing the company of practicing “woke” politics while ignoring its ties to China despite the nation’s human rights violations.
“Should you retaliate against them, for them coming out and demagoguing this bill?” Mr. DeSantis said at a press event when he was asked about Disney’s perks in the state. “I don’t believe you retaliate, but I think what I would say is, as a matter of first principle, I don’t support special privileges in law just because a company is powerful, and they’ve been able to wield a lot of power.”
Democrats, who voted against the measure, excoriated Republican lawmakers and Mr. DeSantis for pushing the legislation as a last-minute addition to the special session, which was initially called to approve new congressional districts after a court struck down a prior plan.
“If you truly believe independent, special districts need to be reviewed, then review that,” said Sen. Tina Polsky, a Democrat representing parts of Broward and Palm Beach counties. “This is why we so often turn to studies and we make thoughtful decisions on billion-dollar issues. We don’t rush them with no testimony and, admittedly, not even speaking to stakeholders, in a matter of two days with no notice during a special session about redistricting.”
A Disney spokesperson did not respond to a request for comment about the legislation.
Although the measure appears to target Disney, it sweeps in four additional special improvement districts constituted in the state before 1968.
“The process has been swift, but it is a bill that is incredibly important,” said Sen. Jennifer Bradley, a sponsor of the bill. “The districts that are affected have not had any legislative oversight in 50 years, and some of the districts have incredibly sweeping powers, such that a single company could start construction on a nuclear reactor at any time. It would not be controversial to say we need to stop and have a little oversight over this process.”
Democrats said the bill is pure political brinkmanship.
“Everyone in this room knows this is not going to happen,” Sen. Jason Pizzo, a Democrat who represents part of Miami, said during the debate on the bill. “Two counties and two cities are not going to assume a billion dollars in debt. We’re not going to do that.”
Republicans argued that the delay would give the surrounding governments enough time to take over Reedy Creek.
The district spent $178 million to operate in 2021, raising the funds by taxing landowners on the property.
State Rep. Randy Fine, a Republican who represents Melbourne Beach, said the counties could take over the district and fund it with the same revenue streams.
“They could operate it exactly how it is being done today except they would have the home rule control,” Mr. Fine said.
Disney provides hundreds of millions of dollars in tax revenue to the two counties and the state, but it is also the recipient of massive tax breaks.
A plan to move 2,000 Disney jobs from California to a new campus in Orlando, for example, would provide the company with a $578 million tax credit.
• Susan Ferrechio can be reached at email@example.com.
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