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Disney says Florida can't dissolve district without paying $1 billion bond debt

Reedy Creek Improvement District officials remind Florida of financial obligation
Posted at 6:32 AM, Apr 28, 2022
and last updated 2022-04-28 06:46:20-04

WEST PALM BEACH, Fla. — The Walt Disney Co. has remained publicly silent since Florida Gov. Ron DeSantis signed a law last week dissolving the Reedy Creek Improvement District, but a letter to investors shows they're not going down without a fight.

The Reedy Creek Improvement District gives Disney the right to govern itself like a city. It allows Disney to raise its own revenues to pay for municipal infrastructure expenses like roads, waste services, fire safety and water at Disney World. Reedy Creek also issues bonds and levies taxes on properties within its boundaries, which border the Orlando area, effectively on behalf of Disney.

The law, which DeSantis signed in a special legislative session, would end any independent special district the Legislature established before Nov. 5, 1968. The Reedy Creek Improvement District was established in 1967.

Disney recently told investors the state would be unable to resolve the district without paying for the district's outstanding debt obligations of about $1 billion. In the meantime, the district is considering its options while conducting business as usual.

In the document acquired by WESH 2 in Orlando, Reedy Creek officials reminded investors that Florida has pledged to fulfill the terms of any agreement made with bond holders.

"Pursuant to the requirements and limitations of Florida’s Uniform Special District Accountability Act, which provides, among other things, that unless otherwise provided by law, the dissolution of a special district government shall transfer title to all of its property to the local general purpose government, which shall also assume all indebtedness of the preexisting special district," the document reads. "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."

The dissolution act was passed after weeks of tension between DeSantis and the Walt Disney Co. over the passage of the controversial Parental Rights in Education law, known by critics as the "Don't Say Gay" law.

In response to the law, Disney suspended its political donations in the state after LGBTQ advocates who work for the company criticized CEO Bob Chapek for what they said was his slow response speaking out against it.