Correct. Universal, SeaWorld, Legoland, etc. do not have special districts to operate in. So no special privileges. From what I understand, officials have been wanting to deal with RCID for years but just pushed it off. I guess maybe change some things? Looks like it’s happening now though.
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It was more about Disney having plans for “futuristic” things that were going to be well beyond the ability of the pretty sleepy governments of Central Florida to provide any meaningful regulatory review. Planning, zoning, and permitting were decidedly haphazard prior to the Growth Management Act of 1984.
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For anyone who is interested, the Disney Dish Podcast has done 2 episodes on the history of the RCID… its fascinating.
Basically, when Disney moved in, this was cattle grazing swampland on the heels of major real estate busts throughout FL. And Disney was contemplating whether to build in Fl, or just resell the land (apparently, after purchasing/consolidating the lots, they could have made a tidy profit just from reselling the land).
FL was considerably more needy in the 1960s and, faced with the specter of Disney building in Northern CA instead of FL, they had to sweeten the deal.
I’m sure I am missing something, but, go listen to the podcasts (last 2 weeks). RCID starting out of a political situation and it may well end because of one as well.
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Universal is within the city limits of Orlando, which provides equivalent city services. Legoland and Sea World are both covered by multiple special districts. Those special districts are much narrower in scope and function than RCID, and cover adjoining property. In fact, outside of incorporated cities, which is most of Florida, special districts are common and provide most municipal services. Sometimes they just exist for the purposes of tailoring taxation to services delivered, but they do exist.
The biggest criticism of RCID was that it could issue tax free bonds. During the '80s and '90s it did to such a degree that it impaired the underwriting ability of other districts and cities in central Florida to issue their own bonds. Since we’re only now coming off of 15 years of historically low bond yields, I haven’t heard that argument in ages.
Let’s not be disingenuous about what’s driving this action.
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DeSantis to Disney and taxpayers
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And isn’t Uinversal even part of some special district, the I-Drive district? I don’t know the scope of that district differs from what SeaWorld has though…
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Cities in my state use bonds to spread out costs for large projects (schools, libraries). These bonds are dependent on individual city’s bond rating. I have never heard of one city’s bond rating impacting another city. Is that unique to FL?
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Probably the new part, which I didn’t consider.
The point is, special districts are a dime a dozen in Florida. I live in an incorporated city, where the city provides everything a plain reading of “municipal services” would be, and I still pay property taxes to six different special districts.
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It wasn’t a matter of bond ratings, but the available pool of underwriting. It’s not like there’s a thousand banks that will underwrite municipal bonds. So the relatively few players aren’t, as a rule, going to back multiple large projects in the same year or two in the same area, just as a matter of managing risk. So RCID would tend to take all the oxygen out of the room, as the expression goes.
Since interest rates have been at historic lows, municipal bonds haven’t had to compete as hard against higher yield debt, so financing has been easier and cheaper.
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Thanks, that makes sense.
I would also say I am disappointed in Chapek through all of this, that being said, I never really had high hopes for him as a leader since he stepped in. The stock price alone is absolutely going to ruin him.
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Even worse than the 1 day is the 6 month. Stocks have ups and downs, but long-term trends tell the story better.
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Yeah it’d be one thing to have a creative like Eisner at the top taking big swings and doing cool new projects all the time. But when you have a guy who’s just a suit in that position, you put him there to make money, and he’s not doing it.
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Could not have said this better. No one is looking to him for inspiration, that’s for sure. Add to it - you lose one of the only guys (Joe Rohde) who fought for doing things really well, not just making shareholders money, and this is what you get.
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I found this thread which seems to be a pretty good, concise analysis of the effects from an Orlando news reporter.
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Yes, this is good and concise.
This is a key point from the thread:
The bigger issue for everyone else is the tax revenue. Disney already pays the same local property taxes as every other landowner. Reedy Creek added its own tax on top of that to pay for its projects. That tax – $163 million per year – is illegal outside of the district.
I was arguing this with someone offline last night. Absent some kind of special district, a taxing authority has to levy the same millage on everyone within its jurisdiction. There is no mechanism for Orange County to tax Disney or anyone else higher based on geography alone. There absolutely has to be a special district defined.
My own county’s example: the original three incorporated cities each has its own police. The cities didn’t want to pay for sheriff patrols to duplicate services. So city residents pay a baseline for traffic enforcement, jail management, and other common services, as a part of the county general revenue. There’s an MSTU that covers just the unincorporated parts of the county that levies specifically for sheriff’s patrols. The same board of commissioners manage it, but it exists as a distinct legal entity.
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I also find all of this especially odd considering Disney gave 100K to DeSantis before all of this started!
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So this was the headline in the NYTimes. I know the articel is behind the paywall, but it is not particularly illuminating. Is it just me, or is their characterization of what was revoked as a “special tax status” lazy reporting and just flowing the talking points of one side?
I should add that the second half of that sentence is also somewhat agenda driven…
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Disney has been known to contribute to both sides of the isle to keep all parties happy. If I’m correct, the problems started for Disney when they said they would no longer give financial contributions to parties who supported the “Don’t Say Gay” legislation.