Reedy Creek Q&A. Everything You Need to Know
In April of 2022, Florida’s legislature voted to repeal the Reedy Creek Improvement Act.
This action has led to plenty of confusion about what has happened and what it means.
I’ve compiled a series of questions you’ve asked on the topic and will try to answer them all. I hope this helps clear up some of the confusion!
What Is Reedy Creek?
During the early 1960s, Walt Disney sneakily purchased land in Central Florida. At the time, most landowners didn’t know the purchaser’s identity.
They happily sold swampland for what they deemed excellent prices. Later, they lamented the choice when they learned that Disney was the buyer.
Once landowners knew Uncle Walt’s identity, they squeezed him for thousands of dollars per remaining acre that he desired.
However, Florida’s government viewed the impending arrival of The Walt Disney Company as a blessing from the heavens.
These officials happily agreed to give Disney whatever it wanted, and this statement held even after Walt himself died in December of 1966.
In May of 1967, Florida passed legislation that effectively allowed Disney to perform its own self-governance.
Walt Disney’s plans called for a capitalist utopia that would turn Florida into a thriving industrial area.
After the founder’s death, the idea transformed into an East Coast version of Disneyland, which was perfectly fine with Floridians.
The presence of Walt Disney World fundamentally altered the tourist perception of Florida, which has since evolved into a vacation mecca.
None of that would have happened if not for Magic Kingdom and the other Disney entities that came afterward.
For this reason, Florida’s government has provided Disney with a berth until recently, gleefully cashing the checks from their rainmaker tourist destination.
Meanwhile, Reedy Creek has allowed Disney to skip the bureaucracy that comes with big business.
Since Disney functions as a form of county government, all its municipal requests zoom to the top of the list.
In short, thanks to Reedy Creek, Disney always gets what it wants. But, sadly, that’s not always how government works as a rule.
Why Doesn’t Disney Pay Taxes?
When politicians targeted Disney as an opportunity to score points with some voters, a list of allegations about the company popped up.
As you might imagine, it was a smear campaign designed to make Disney look bad in a rather bold instance of people biting the hand that feeds them.
Among the strangest allegations was that Disney didn’t pay any taxes. I honestly wish I could have seen the faces of Disney executives when they heard this.
This is a strong example of something that doesn’t pass the laugh test.
In 2021 alone, Disney paid $780.3 million in state and local taxes, and that’s when we ignore the ancillary impact of Walt Disney World residing in Orlando, Florida.
In 2019, the last full year before the pandemic, Florida gained $27.6 billion (with a b) from local and state sales relating to tourism.
Without that revenue, Floridians would need to pay another $1,500 each to make up the difference in income.
Disney obviously isn’t responsible for all $27.6 billion of that. However, Walt Disney World is arguably the most popular paid tourist destination on the planet.
Similarly, competitors like Universal Orlando Resort, SeaWorld Orlando, and many local Central Florida tourist locales wouldn’t exist if Disney hadn’t arrived first.
From a financial perspective, Disney is the state’s primary source of tax revenue. So, if someone tells you Disney isn’t paying taxes in Florida, that person is lying to you.
In fact, Disney has recently overpaid its taxes by several million.
Will Disney Pay $200 Million More Per Year?
I’m acutely aware that some politicians are ginning up support by making ludicrous assertions like these.
However, I’m not big on political theater, only facts. And the fact here is that this is another orchestrated lie being passed around as truth.
Some images in Facebook groups made this assertion/piece of propaganda. To its credit, Facebook did some fact-checking and removed the posts as misinformation.
That should tell you the entire story right there, as Facebook tries to stay out of this stuff as much as possible.
The argument, such as what was, indicated that Disney’s loss of Reedy Creek self-governance would cost the company in the wallet.
According to this false assertion, Disney hadn’t paid its property taxes, and that was about to change. I just linked you to an article that the opposite is true. Disney overpaid for its property taxes.
What’s happening is that politicians want to score points on Disney by appearing tough on the company.
They’re creating fiction to make themselves sound like the hero in the story.
As a child, I learned these stories as fish tales, the one where the fisherman almost caught a whale that was probably closer in size to a guppy.
The same premise applies now. If I told you I fought a bear, it would sound impressive.
If I told you that I saw a bear, ran and hid, and cried for days, you wouldn’t think much of me.
So, which story am I incentivized to tell you? Yeah, I fought a bear. No, wait! It was two bears!
Seriously, the people who just voted to dissolve Reedy Creek need to sell the story that they did something good.
When the facts don’t support them, they make baseless claims on social media, knowing that some will believe the stories anyway.
Are There Lawsuits Pending about Reedy Creek?
Some of these answers aren’t finite. If I say no, I could learn soon afterward that a lawsuit had been filed in local or federal court.
We already had one filed and then dismissed by a federal judge. The explanation here has nothing to do with the matter itself, though.
Someone filed a lawsuit that claimed the revoking of Reedy Creek had violated the Taxpayer’s Bill of Rights.
The judge rightfully threw this one out of court because the law won’t go into effect until next July.
For this reason, no one could claim that they have been negatively impacted yet. Nothing has even happened. Still, the person suing has already re-filed their claim.
That’s the likely future here. Analysts have predicted a long road of messy lawsuits. On this topic, Florida legislative experts fall into two camps.
One group believes that the government was well within its rights to modify this legislation. Another feels that the residents of Reedy Creek get the final say on the matter.
Disney handpicks Reedy Creek residents for voting purposes. So, if the latter statement proves true, nothing will happen here.
Even if the former holds, questions abound about whether Florida acted legally.
Many of the best legal minds have chimed in here. They feel strongly that Florida has violated Disney’s First Amendment rights.
So, whether we have lawsuits or not at the moment, we likely will soon.
That aspect will only change if Disney decides Reedy Creek has outlived its usefulness, which is a distinct possibility.
Will Florida Residents Foot the Bill for These Changes?
That remains to be seen. Remember that nothing will happen for another 14 months. We have an election between now and then.
Almost all the facts that have come up thus far paint a grim picture about this dissolution plan, indicating that it wasn’t researched – it wasn’t – and is ill-considered.
Some of the most alarming claims involve the onus of taxpayer debt.
Disney has bonds in the amount of $2 billion that Reedy Creek will pay down over the next 15 years.
Those bonds come due if/when Reedy Creek dissolves. Someone has to foot the bill for that. The prevailing wisdom suggests that it’s Orange and Osceola County residents.
Those people vote in elections like the governor of Florida. So, I fully expect a plan to emerge that at least makes a convincing argument Disney will bear the financial onus.
How feasible is that? The numbers crunchers feel like it’s not at all. Yet, the politicians are swearing it’ll happen.
That leads us to two different but applicable facts of life. 1) Politicians lie. 2) You should always follow the money.
I’m inclined to trust the accountants more than the politicians. Your mileage may vary.
According to the Orlando Sentinel, the most likely outcome is that Florida’s legislative branch chooses not to replace Reedy Creek.
Instead, the state government would control all the Reedy Creek daily business previously handled by Disney.
I cannot comment on how efficiently that would work until a firm proposal is on the table. That’s unlikely to happen until election season.
I cannot stress enough how much of this is political theater. The issue isn’t much ado about nothing, but little of what’s happening involves what’s best for Disney or Florida residents.
What Will Happen to Reedy Creek Employees?
Nobody knows the answer to that, but some of the early reports could stress you out.
For example, 200 Reedy Creek firefighters work for Disney. They’re now worried about job security and the identity of their next boss.
If Disney doesn’t pay for Reedy Creek, that’s a sudden expense for those counties.
That cost exists in addition to the potential tax burden Orange and Osceola County may face due to the dissolution of Reedy Creek.
The idea of higher taxes but lesser quality governance isn’t what anybody wants, but it’s a legitimate possibility here.
Currently, guests on the Disney campus receive exceptional crisis care. But unfortunately, if Disney doesn’t operate Reedy Creek, guests may wait too long for help.
I hate to be the bearer of bad news here, but there’s tons of stuff that wasn’t taken into consideration before this vote.
We’re all dealing with the ramifications of it now. What will happen next?
Nobody knows for sure, but MickeyBlog will do everything possible to keep you informed.
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Feature Photo:Photo Credit: World of Walt.com