Reedy Creek Improvement District

[Nick]

Disney saves so much in taxes each year by having the RCID, so in one way it'd be hilarious and honestly deserved. But if this actually does happen, The Board of Directors needs to turn around and fir Chapek immediately because he has handled the whole situation horribly to let it even get to this point.

Please refrain from making this political and stick to topic at hand.

 

[n i c k]

I ask this honestly, but how can this discussion occur without being political?

 

[Nick]

I ask this honestly, but how can this discussion occur without being political?

If there's news from politicians about the subject at hand, that's fine, but otherwise no need to talk politics. Basically, don't post in this thread just because you want to talk politics, take that to twitter.

And no, the subject at hand is not political in nature. The subject is about RCID and imo, how Chapek has bungled this, period. If there's no news about that, there really shouldn't be much discussion.

I'll just say that as a company, if you are going to say anything to try to influence state laws, then you need to do it before it is passed if you care so much. They were quiet when they should've been loud and then they became loud when there was nothing they could do. If you're gonna raise your voice, you need to do it before it's too late for whatever the goal of raising your voice was.

 

[HandsomePete]

I'm glad someone started a thread because I legit burst out laughing when I saw that some legislator was threatening to end the Reedy Creek exemption. At this point of the property's existence, it would probably help more than hurt the company to kill off RCID.

Disney saves so much in taxes each year by having the RCID

What taxes do you reckon they save? They pay property taxes to Orange County *and* Reedy Creek and the combined millage rates are astronomical compared to the rest of the county (here). If Reedy Creek disappears and Orange County "runs" the district, things like RCFD go away and the cost of providing firefighting/paramedics to WDW gets absorbed by Orange County and the incremental cost gets spread across all of Orange County's tax base. Same with electricity, water, and basically everything utility/infrastructure related.

Just to put that into perspective, RCID's annual budget was about $170M last year. Probably +90% of that is paid for by Disney through taxes that go beyond what they pay to Orange County. If RCID disappears, Disney no longer has to pay that ~$155M per year and gets to dump its infrastructure support costs into the county budget. The main benefit of Reedy Creek is not having to pay impact fees to the county, but that's negligible when you're not building a ton of houses or other new construction.

And if it were up to Disney, they'd probably be thrilled to ditch EPCOT Building Codes.

Now the Disney Springs parking garages? Those were absolutely a gift from Reedy Creek. But that touches on another issue, which is that they have assets - do those just get liquidated?

The whole thing is a colossally stupid idea both in practice and as what is supposed to be a punishment.

 

[Nick]

I'm glad someone started a thread because I legit burst out laughing when I saw that some legislator was threatening to end the Reedy Creek exemption. At this point of the property's existence, it would probably help more than hurt the company to kill off RCID.


What taxes do you reckon they save? They pay property taxes to Orange County *and* Reedy Creek and the combined millage rates are astronomical compared to the rest of the county (here). If Reedy Creek disappears and Orange County "runs" the district, things like RCFD go away and the cost of providing firefighting/paramedics to WDW gets absorbed by Orange County and the incremental cost gets spread across all of Orange County's tax base. Same with electricity, water, and basically everything utility/infrastructure related.

Just to put that into perspective, RCID's annual budget was about $170M last year. Probably +90% of that is paid for by Disney through taxes that go beyond what they pay to Orange County. If RCID disappears, Disney no longer has to pay that ~$155M per year and gets to dump its infrastructure support costs into the county budget. The main benefit of Reedy Creek is not having to pay impact fees to the county, but that's negligible when you're not building a ton of houses or other new construction.

And if it were up to Disney, they'd probably be thrilled to ditch EPCOT Building Codes.

Now the Disney Springs parking garages? Those were absolutely a gift from Reedy Creek. But that touches on another issue, which is that they have assets - do those just get liquidated?

The whole thing is a colossally stupid idea both in practice and as what is supposed to be a punishment.

There's plusses and minuses, but pretty much all of the road improvements are paid for by RCID (and Disney does those never ending), and as you mentioned, the Disney Springs garages were RCID projects. Pretty much any infrastructure project is RCID.

Also, the amount of hassle Disney saves by not have to deal with Osceola County or Orange County like Universal and SeaWorld have to do is a big advantage. Although there are some ways in which I could see Disney be totally fine with this going away.

 

[HandsomePete]

There's plusses and minuses, but pretty much all of the road improvements are paid for by RCID (and Disney does those never ending), and as you mentioned, the Disney Springs garages were RCID projects. Pretty much any infrastructure project is RCID.

Also, the amount of hassle Disney saves by not have to deal with Osceola County or Orange County like Universal and SeaWorld have to do is a big advantage. Although there are some ways in which I could see Disney be totally fine with this going away.

But road improvements being paid by RCID means, for all intents and purposes, paid for by Disney because almost all of the Reedy Creek budget is funded by property taxes. The upside is the ability to issue municipal bonds, but they still have to pay those back with interest, and the vast majority of Reedy Creek's revenue is coming from Disney. I always figured the benefit of RCID building the Disney Springs garages was timing of cash flow and not actually getting "free" parking garages.

I think a lot of people think Reedy Creek is just a rubber stamp and less of a hassle than the county, but the hassles with all the minutiae of construction and permitting like fire panels, ambient light, full-shutdown tests, elevators, wind rating, and on and on... are basically the same or stricter.

 

[MrBlonde]

Is this actually a thing or just political based performance art?

If they end up doing this, wouldn’t Disney have to complain to county government to get its infrastructure upgraded when it wants to? It could be a mess.

But road improvements being paid by RCID means, for all intents and purposes, paid for by Disney because almost all of the Reedy Creek budget is funded by property taxes. The upside is the ability to issue municipal bonds, but they still have to pay those back with interest, and the vast majority of Reedy Creek's revenue is coming from Disney. I always figured the benefit of RCID building the Disney Springs garages was timing of cash flow and not actually getting "free" parking garages.

I think a lot of people think Reedy Creek is just a rubber stamp and less of a hassle than the county, but the hassles with all the minutiae of construction and permitting like fire panels, ambient light, full-shutdown tests, elevators, wind rating, and on and on... are basically the same or stricter.

Just thinking about this out loud- they pay taxed to RCID, assume all of it get reallocated to the appropriate county, but then the quality of infrastructure projects are downgraded to the county quality's not RCID. They also become a big stakeholder is a fight for resources of a bigger pool. Disney's Disney but still there are other interests to serve.

One thing I can see becoming a definite negative are the lack of muni bonds that RCID gets to raise to fund their projects. No taxes on projects for basically an exclusively single user is a very nice benefit, plus you can have super long bond terms, etc. etc. all backs by property taxes.

Using the DS Parking as an example, if they did it again, it either would need Orange county to raise the bonds, but it could be allocated elsewhere, or wait for room in the budget to start the project. I definitely don't think Disney would want to be stuck on a county's timetable.

 

[Jerroddragon]

So basically the government threatening to make your business worst off unless you support their bills? I don't Like this at all, sure maybe Disney shouldn't be running its own town but I've never heard it was being run badly so think they should be able to keep doing what they have been

You gotta love how weak these people are for Disney literally paying to support the people behind the bill but them saying one little thing about it which more the internet thought was half assed gets you in trouble? What a joke

 

[GA-MBIT]

Disney shouldn't have RCID in the first place imo. FWIR it was born from the doomed City of Epcot idea that never got made and just got grandfathered in cause Disney brought so much tourism. Don't agree with the other side's reasonings at all but if they wanna take this direction, I won't stand in their way.

 

[xxbrothawizxx]

So basically the government threatening to make your business worst off unless you support their bills? I don't Like this at all, sure maybe Disney shouldn't be running its own town but I've never heard it was being run badly so think they should be able to keep doing what they have been

You gotta love how weak these people are for Disney literally paying to support the people behind the bill but them saying one little thing about it which more the internet thought was half assed gets you in trouble? What a joke

They pledged to stop donations in the future (until they walk that back at some point). You don't mess with the money.

 

[SkiBum]

So basically the government threatening to make your business worst off unless you support their bills? I don't Like this at all, sure maybe Disney shouldn't be running its own town but I've never heard it was being run badly so think they should be able to keep doing what they have been

You gotta love how weak these people are for Disney literally paying to support the people behind the bill but them saying one little thing about it which more the internet thought was half assed gets you in trouble? What a joke

I've seen it go the other way, too, just as much. Via lobbyists or out and out threats, businesses do seek to push laws and greater/lesser regulations that benefit them most. Government should not be bullying corporations but corporations shouldn't be the ones that drive law and regulations.

 

[SeventyOne]

Is this actually a thing or just political based performance art?

That the $64k question. I floated this as a hypothetical on Twitter yesterday morning, not realizing meetings had apparently already been held. Today Governor Ron DeSantis (a man looking to raise his public profile before 2024 of course) held a news conference where he seemed to endorse the idea, and at least 3 GOP state reps said they would return donations from Disney. So moving along faster than I anticipated but I'm still not convinced it will happen.

Unfortunately for Disney, there is already a special session scheduled for April (the Florida legislature meets early, is usually done with its session by March). What would likely have blown over by next January may still be news in a week or two.

 

[SkiBum]

That the $64k question. I floated this as a hypothetical on Twitter yesterday morning, not realizing meetings had apparently already been held. Today Governor Ron DeSantis (a man looking to raise his public profile before 2024 of course) held a news conference where he seemed to endorse the idea, and at least 3 GOP state reps said they would return donations from Disney. So moving along faster than I anticipated but I'm still not convinced it will happen.

Unfortunately for Disney, there is already a special session scheduled for April (the Florida legislature meets early, is usually done with its session by March). What would likely have blown over by next January may still be news in a week or two.

My guess is that this all turns out to be some posturing. Hopefully, the government will take time to look into what will happen if they carry through on their threat (i.e. Will it be significantly worse for the state and local government) and both sides determine that a good working relationship is the best solution here.

 

[Freak]

I won't touch this thread much as I don't wish to dabble into the political side of things. All I will say is that the timing is interesting. Disney has not exactly been maintaining good optics in general lately so this seems to be a good opportunity to jump on this.

I hope this will be the start of Disney's reckoning. Getting kind of sick of Disney virtually getting away with murder in how they run things. The throne of Hubris can only last so long.

 

[fryoj]

I guess one of the questions would be does the county give Disney a tax break because of RC, and could they increase that tax rate to account for having to provide services they aren't now?

Another question is, who owns the Disney Springs Garages? Does RC or have they been given to Disney? If RC owns them, I'd assume the ownership would transfer to the county. Then, they could charge for parking to recoup the additional costs they have from taking over the RC services. That would be an issue for Disney and likely have a negative affect on revenues at DS.

But Disney having to go to them to get approvals for things and for public upkeep projects would probably be enough of an annoyance for them to not want it to happen.

 

[Scott W.]

I will preface this by saying that I think both Disney and Comcast are both the stereotypical faceless evil corporations and what they've done is wrong.

That aside, I think how Disney and Universal have handled their PR in relation to everything, will be cases studies in business school sooner or later.

Does anybody have a pros and cons list for Disney and the county if this happens or not?

 

[SkiBum]

Does anybody have a pros and cons list for Disney and the county if this happens or not?

Exactly. This is what the state government needs to sort out instead of just reacting.

 

[HandsomePete]

I guess one of the questions would be does the county give Disney a tax break because of RC, and could they increase that tax rate to account for having to provide services they aren't now?

Nope - county millage rates for Orange County and Disney property are the same. Disney is essentially already paying for services that they don't use. And if Reedy Creek were to go away, the county can't just carve off the cost of, say, the fire department coverage for WDW and charge that alone to Disney. It would get added to the total budget that covers the county and spread across everyone.

Disney gets a slight benefit because they pay city taxes for Bay Lake instead of Orlando, and Bay Lake isn't a real city. But the Reedy Creek assessment more than makes up for the benefit of lower city taxes. If Disney paid the same tax rate as Universal, they'd save a little over $100M per year.

Another question is, who owns the Disney Springs Garages? Does RC or have they been given to Disney?

They belong to Reedy Creek. They will never be "given" to Disney.

 

[shiekra38]

I look forward to watching this fight from Hogwarts

 

[Nick]

They belong to Reedy Creek. They will never be "given" to Disney.

So in the scenario that RC is eliminated, what happens to them? Are they given to Orange County?

EDIT: Changed the thread title to better reflect what the main topic is.