This is so humiliating that I cringed on DeSantis’s behalf while reading it. It’s the sort of thing a parent would worry about in a battle of wits with their child. “How do I achieve my objective here without him throwing a tantrum?”
Disney has otherwise remained publicly silent about the feud and did not respond to requests for comment for this article. Sources familiar with the negotiations, who requested anonymity to discuss private negotiations, say the company’s lobbyists and lawyers have been working behind the scenes to find a solution that would allow DeSantis “to save face” and continue to claim a victory over “woke culture,” while in reality doing very little to impede the company’s massive operations in Florida…
“Disney won’t rock the boat,” said a lobbyist who does not work for Disney but is familiar with ongoing negotiations between the company and the governor’s office. “They’ll have private conversations with members and staff once things cool off a bit, and come up with a plan to get what they want. Part of the conversation is they won’t wade back into these issues, and DeSantis will move on to another topic.”
The bond issue that’s threatening to derail the state’s dissolution of the Reedy Creek Improvement District appears to have been missed entirely by DeSantis’s lawyers, although not by Disney’s. There’s no easy after-the-fact solution to it either, as you’ll see if you follow the last link. Florida’s either going to back down or it’s going to have to pay off RCID’s bondholders early — which is illegal with respect to one class of bonds. To pay off those bondholders, it’ll have to get the money either from Florida’s taxpayers or by seizing Reedy Creek’s assets via eminent domain (which Disney can probably thwart) or by creating a new taxing district, which Disney has the power to veto under current state law.
What’s the governor going to do? He definitely has a plan, his spokesman said yesterday. As for the details of that plan, they’ll, uh, get back to you:
“As Governor [Ron] DeSantis has said, Disney will pay its fair share of taxes, and abolishing the special district will not cause tax increases for the residents of any area of Florida,” DeSantis spokesperson Christina Pushaw wrote in a statement Thursday. She replied to one person on Twitter that she “will be sure to post more details on the plan as soon as I can share those.”…
“If it’s true that the repeal of the special district would hand Disney a tax break, and the local taxpayers would be on the hook for this bail-out to benefit Disney … why would Disney oppose the idea of repealing their special district?” Pushaw wrote. “Indeed, if that was true, why wouldn’t Disney have lobbied to get rid of the special district long ago?”
Repealing the district wouldn’t hand Disney a tax break. It would, however, shift RCID’s billion-dollar debt to Orange and Osceola counties. But because Disney gets to set its own rules within RCID and hires top-notch people at good pay to perform the functions of civil servants, it may value having its own district more highly than it does being able to offload debt onto neighboring districts. Running Reedy Creek means the company never has to apply for permits or wait for approvals or otherwise rely on the sluggish, overburdened administration that’s common with normal county governments.
We could turn Pushaw’s question around, though. If it’s true that Reedy Creek is a bad deal for the state of Florida, why wasn’t getting rid of it a priority for DeSantis (or any other governor over the past 55 years) when he took office? Why did the idea only occur to Florida Republicans after Disney spoke up against the “don’t say gay” bill? The answer, obviously, is that the state has no fiscal objection to RCID. They went after it to retaliate against Disney for taking the other side in an unrelated culture-war dispute.
And they did it in a sloppy way, a “ready, fire, aim” flourish to impress DeSantis’s populist fans and burnish his 2024 case that led them to overlook the fiscal consequences. Now Disney has to clean up this mess. And because it’s dealing with a politician who’s building a brand as a strongman, a hero who’ll slay the base’s enemies, it has to manage him carefully so as not to bruise his ego when it wins. A strongman can’t tolerate being perceived as weak; the greater the risk of that happening, the more he’s forced to fight on to prove that he doesn’t back down. Which is why Disney’s legal team is trying to contrive some way that DeSantis can sell a retreat as a win over “woke corporations.” That’s the only way this dispute ends soon-ish, without it dragging out and getting much more expensive to protect DeSantis’s “he fights” cred.
In the meantime, workers at Reedy Creek are in limbo, not knowing whether they’ll have jobs next year or not. The head of the firefighters’ union there asked the board at a meeting this past week whether his members will still have their guaranteed lifetime health insurance when this is over. They had no answer for him. Meanwhile, the prospect of Florida conceivably breaking its pledge to Reedy Creek bondholders not to “alter” the district before its debts are paid is beginning to spook markets. Yesterday Fitch warned that if DeSantis’s government doesn’t resolve that uncertainty it could begin to affect the bond ratings of other Florida government entities. A state that can’t be trusted to keep its promises will need to pay higher interest rates to entice investors.
At least this will end up a political win for DeSantis, though, right? Definitely — in a primary. In a general election the picture is less clear. I’ll leave you with this from Reuters, which is out today with a new poll: “The two-day poll completed on Thursday showed that 62% of Americans – including 68% of Democrats and 55% of Republicans – said they were less likely to back a candidate who supports going after companies for their views.”