What Disney’s Recent Legal Victory Could Mean For Hospitality Industry
Disney had its day in court recently and the outcome could save other hotels millions of dollars in taxes according to a recent piece in the Orlando Sentinel. The verdict was the culmination of a years-long lawsuit between Disney and Orange County Property Appraiser Rick Singh. An appellate court determined that Singh’s office improperly inflated the value of Disney’s Yacht & Beach Club Resort.
Those representing the hospitality industry are saying the verdict which was issued on June 19th will have a lasting impact. This is due to the fact that the court declared that the methods Singh used to appraise the property is illegal under Florida law.
As a result of the judgement, industry insiders are now saying that Disney and other hotel companies (especially with the industry taking a hit during COVID-19) will use this ruling to push for lower tax assessments on their properties. Disney, for instance, is now already challenging appraisals for at least 10 more resorts.
Under the new appraisal system, the value of Disney’s Yacht and Beach Club more than doubled to nearly $340.00 million. This resulted in Disney filing the lawsuit arguing the Singh had overstated the value of the property. Years later it finally reached the Fifth District Court of Appeal which ultimately agreed.
The deciding factor for the decision came over the use of the method known as “Rushmore” that the appraisers used. The court argued that the method is not an accurate way of accessing the property. Because the method is used by appraisers across the country the verdict could have a far-reaching impact.
As a result of the verdict, Disney should expect a reduction on the property taxes for their properties. Jacquee Wahler, a spokesperson for the company said, “We are pleased that the court concluded that the method used by the property appraiser violated Florida law.” She added “We look forward to a reassessment of our properties consistent with Florida law and the court of appeal’s ruling.”
Singh does have the option to appeal. Beth Watson, a spokesperson from the Sentinel said that Singh’s office remains confident in its appraisal practices but also said that it was alarmed by the reach of the courts ruling. “We are concerned about the broad nature of the ruling on the use of the Rushmore method,” Watson said. “While the DCA may deem it inappropriate for the Disney hotels at issue, their ruling could impact thousands of properties in Florida.”
This is a story that we’ll be following closely here at MickeyBlog. Readers are encouraged to keep checking in with us for the latest news and updates.
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Source: Orlando Sentinel