Reedy Creek Fires Back at DeSantis Attempt to Repeal Disney’s Special Taxing District
Florida’s Contractual Obligations to Bond Holders Block Repeal of Disney’s Special Taxing District, Says Reedy Creek in New Statement
Ever since Gov.
Ron DeSantis (R-FL) signed the bill
repealing the Reedy Creek Improvement District (RCID), the special taxing district operating on the 25,000 acre parcel the Walt Disney Company owns in Central Florida, there has been a lot of discussion of various ways Disney might challenge the bill, chiefly on
First Amendment grounds. A new statement issued by RCID brings to light a simpler and direct obstacle to repealing the district’s existence: the state’s contractual obligations related to RCID’s bond debts.
Last week, this reporter wrote
a deep-dive analysis of the repeal of RCID for Mediaite, including the looming consequences thereof, not just for Disney but for the Central Florida economy as a whole. Specifically, the elimination of RCID as a legal entity does not eliminate the district’s $2 billion bond debt and would instead transfer that to Orange and Osceola Counties.
Florida law prohibits counties from treating taxpayers differently by charging different tax rates unless there is a special taxing district specifically authorizing such differential treatment, so Orange and Osceola would have to spread that debt payment across all of their taxpayers. Orange County Tax Collector
Scott Randolph estimated that this would raise taxes in his county between $2,200 and $2,800 per family of four.
Two Central Florida local government attorneys were cited in the
previous Mediaite article raising objections about the complexity of unwinding RCID; another one is now speaking out on this issue of RCID’s bond debt. In an article for
Bloomberg Tax,
Jacob Schumer of the firm of Shepard, Smith, Kohlmyer & Hand pointed out the “contractual impossibility of unwinding” RCID.
RCID is structured to operate in many ways like a local government entity, and like many cities and counties across the country it borrows money for ongoing infrastructure development by issuing bonds. This type of debt is usually viewed as very secure by the lenders due to the real property that secures it and the transparency of the district’s governing rules and financial records, meaning RCID can borrow money in this way with a low interest rate.
1 day ago · In other words, the most charitable interpretation
of DeSantis’ retaliation
against Disney is that it is, at best, a bank shot. It might make …
1 day ago · But now that the
DeSantis-Nunez administration says they will listen to
Disney’s petition next year to restore its tax privileges, this looks like a quid pro quo, which is
corrupt.