Ron DeSantis' Disney Revenge Could Cost Florida Residents $1 Billion

[LetMyPeopleVote]

In Texas, when a city incorporates unincorporated territory, the city assumes and discharges the MUD municipal utility district debt. This is the same concept

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Residents of two Florida counties could end up footing the bill if the state abolishes a special district that has allowed the Walt Disney Company to operate its own local government.....

Farmer, who sponsored the bill, discussed the potential impact on Orange and Osceola counties' residents, saying the population would amount to around 1.75 million people.

"The debt service alone for Reedy Creek is over $1 billion," Farmer said. "This bill makes no provision as to how that debt service is going to be assumed."

The Democrat pointed to another law that said that local government entities would have to pick up the debt of special districts that are dissolved.

The Reedy Creek Improvement District has a long-term bonded debt of $977,215,801, according to its 2021 annual financial report.....

"So this is not supposition, this is not conjecture, this is Florida law that says those 1.7 million people are going to have to pick up this bill," Farmer said, adding that the $1 billion figure doesn't include other items covered by the district, citing fire fighter services and parking garages, among other services.

"All totaled, we're probably talking about $1.5 to $2 billion of obligation - of liabilities," Farmer said.

He went to say that "the debt service alone would amount to $580 per person."

[SoCalDavidS]

1. This Talk About Disney Leaving FL Is Sad

There is ZERO chance of that happening. Less than zero actually.

[no_hypocrisy]

2. More unintended consequences:

Disney's stock goes up due to less expenses for maintenance and security, etc. that Floridians will now take over.

[LetMyPeopleVote]

3. Disney tells investors state can't dissolve special district without paying debt

Disney has far better lawyers than DeathSantis. I was wondering why Disney was keeping quiet and then I read this article and the other articles. The State of Florida in effect made some guarantees to the bondholder and the Disney special district cannot be dissolved while there is debt outstanding

DeathSanitis is an idiot who passed this law out of spite. Being an idiot, DeathSantis screwed up and put Disney in the driver seat. Florida has over 1400 special districts and you do not dissolve these entities because these entities have debt

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https://www.miamiherald.com/news/politics-government/state-politics/article260783972.html

As Florida legislators were rushing through passage of a bill to repeal the special district that governs Walt Disney World last week, they failed to notice an obscure provision in state law that says the state could not do what legislators were doing — unless the district’s bond debt was paid off.

Disney, however, noticed and quietly sent a note to its investors to show that it was confident the Legislature’s attempt to dissolve the special taxing district operating the 39-square mile parcel it owned in two counties violated the “pledge” the state made when it enacted the district in 1967, and therefore was not legal. The result, Disney told its investors, is that it would continue to go about business as usual.......

Disney’s statement says, “In light of the State of Florida’s pledge to the District’s bondholders, Reedy Creek expects to explore its options while continuing its present operations, including levying and collecting its ad valorem taxes and collecting its utility revenues, paying debt service on its ad valorem tax bonds and utility revenue bonds, complying with its bond covenants and operating and maintaining its properties.’’ In essence, the state had a contractual obligation not to interfere with the district until the bond debt is paid off, said Jake Schumer, a municipal attorney in the Maitland law firm of Shepard, Smith, Kohlmyer & Hand, in an article for Bloomberg Tax posted on Tuesday and cited in a Law and Crime article......

Randolph calls the measure the “no lawyer left behind act,” and predicts that there will be many lawsuits, including one from bondholders, alleging the state illegally impaired the contract.

[LetMyPeopleVote]

4. DeSanTax

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In Texas, we are paying the Abbottax in the form of increase charges to recover the costs of last years freeze. My power bills are over $70 per month higher. Deathsantis has to keep up with the DeSantx

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[LetMyPeopleVote]

5. Rating agency warns Disney debt conflict could 'weaken' other Florida government bonds

The rating agencies are worried about DeathSantis' stupid stunt. This is going to cost the state of Florida and local governments a great deal. If the rating agencies down grade Florida's credit, the cost of borrowing goes up

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https://www.miamiherald.com/news/politics-government/state-politics/article260873762.html

One of the nation’s leading bond rating agencies warned Thursday that if the state of Florida doesn’t resolve a conflict over its decision to repeal Walt Disney World’s Reedy Creek Improvement District and its obligation to investors, the move could harm the financial standing of other Florida governments.

Fitch Ratings posted the alert late Thursday on its Fitch Wire web site, nearly a week after Gov. Ron DeSantis signed into law the measure dissolving the special taxing district that governs Disney property by June 1, 2023. Reedy Creek Improvement District holds nearly $1 billion in bond debt and last week Fitch issued a “negative watch” because of the uncertainty around how that debt will be paid and by whom......

A 1967 state law that established the Reedy Creek Improvement District on 39 square miles of Disney property gave the district the power to issue bonds and tax itself to build roads, sewers and utilities, establish its police and fire departments, and regulate its construction. In exchange, the state pledged “it will not limit or alter the rights of the District...until all such bonds together with interest thereon...are fully met and discharged.”

The law dissolving the district does not address how the bonds will be paid, but on Friday when he signed the measure, DeSantis said: “We’re going to take care of all that. Don’t worry. We have everything thought out. Don’t let anyone tell you that somehow Disney is going to get a tax cut out of this. They’re going to pay more taxes as a result of that.”

There is no easy way of fixing this issue without endangering the credit of the state