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Disney Loses Special Tax District Under New Law

The Walt Disney Corporation is having a less-than-magical moment. Days ago, Florida Governor Ron DeSantis assumed control over the Reedy Creek Improvement District, a special tax district that gave Disney a significant degree of control over the development and management of nearly 40-square miles of land within its boundaries, which included theme parks, hotels, residential areas, and other real estate. Since the late 1960s, Reedy Creek has been effectively governing itself and acting with the same authority as a county government body. However, a sweep of DeSantis’ pen has effectively dissolved the Reedy Creek board, handing the governing power back to the state. 

Under the new law, Florida counties Osceola and Orange will each absorb their respective fragments of the former district’s land area. Residents now must pay taxes to their Florida county governments, and any future developments will be governed by the corresponding county rules and regulations. However, Disney is allowed to preserve the majority of the benefits that have given the firm the freedom to self-govern the property on its vast theme park resort for more than 50 years. It keeps practically all of its debt responsibilities—likely because the Reedy Creek district was nearly $1 billion in debt—and is immune from specific rules, taxes, and fees. It also has the authority to behave a lot like its own government, including the capacity to issue bonds and offer infrastructure services on its property.

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