Well now it's happened, and apparently it's going to cost people in Orange County a bunch of money.
Scott Randolph, Orange County’s tax collector, estimated absorbing Reedy Creek’s liabilities could cost property owners an extra $200 to $250 a year in property taxes. That’s a rough estimate, though, based on Reedy Creek Improvement District’s financial statement and the assumption Orange County absorbs Reedy Creek’s liabilities.
Reedy Creek collects about $164 million in property taxes to maintain roads, utilities and other services, which is almost entirely paid by Disney.
If Reedy Creek were dissolved, no other governmental entity would have the authority to collect that money, Randolph said.
“There is no windfall to the county,” Randolph said. “There could be a ton of expenses with no additional revenue to cover it.”
Disney would continue to pay property taxes to Orange and Osceola counties, school districts and other entities as it has in the past. Reedy Creek enables Disney to avoid some other taxes, such as impact fees and sales tax on construction materials.
Governing Disney World and maintaining its surrounding property is a massive undertaking. Reedy Creek maintains 134 miles of roads and 67 miles of waterways, according to the district’s statistics. It handles 60,000 tons of waste and recycles 30 tons of aluminum, paper, steel cans, cardboard and plastic containers each year.
The district hosts 250,000 daily guests, which is more than the 196,000 people who live in Tallahassee, the state capital. With 77,000 pre-pandemic employees, Disney World is one of the largest single-site employers in the United States.
Sen. Jeff Brandes, R-St. Petersburg, questioned whether the Legislature’s effort would inadvertently help Disney financially.
“The assets include roads, which we would be unlikely to shut off,” he said. “A dump. A power plant, which we would be unlikely to turn off. A fire station, which we would be unlikely to shut down. So those assets, we would now take over the operations, the maintenance and support of, and Disney would be able to walk away from that ... debt.”
It's also going to cause problems with the bond market too.
Settling with bondholders could be another complicated matter, and investors have been mystified by what is happening in Florida, said Eric Kazatsky, a senior strategist for Bloomberg Intelligence specializing in municipal bonds.
Florida’s bond documents include a covenant — a commitment to investors — that the state will not “limit or alter” the rights of Reedy Creek to collect revenue, including levying taxes. Kazatsky said he’s spoken with investors and others in the bond market who are puzzled by what is happening in Florida.
“It’s a lot of head-scratching, and are they even allowed to do this?” he said. “It seems like they have a legal hurdle here. They have covenanted to do something.”
https://www.orlandosentinel.com/politic ... story.html
