Disney Loses RCID: So What?

So what happens if Reedy Creek Improvement Act gets repealed?  It would be a disaster for Disney. One of the reasons they came to Florida in the mid-60s was the legislature's promise that they could have self-government. If repealed, Disney World would no longer function as its own county and would instead need to follow policies and regulations in both Osceola County and Orange County. They would also need to gain approval from the county legislatures in order to move forward with many of their essential functions. Essentially, it would strip away Disney's legislative and regulatory flexibility that has enabled them to implement innovative construction techniques in both the structures that we see as everyday guests (like new attractions) and the things that we don't see, like water control and environmental protection of the land.

It could also slow down the construction progress on many of Disney's current and upcoming projects, as they would need to seek approval from the counties and follow certain city regulations. Plus, with no control over their own zoning, Disney could face heavy restrictions when it comes to what they build and where. Additionally, repealing the act would have significant tax impacts for Disney World because, as an improvement district, Disney receives quite a few tax breaks as it relates to construction. The Orlando Sentinel explains it by saying that "Construction inside the district is exempt from certain taxes and fees added by the county governments." More specifically, Disney is exempt from impact fees, which are "one-time payments developers make to offset the cost of public services like roads." If the RCID didn't exist, "Disney would pay the fees, like any other developer, to Orange and Osceola counties."

In fiscal year 2020, this would have totaled to "about $21.1 million," according to an Orange County comptroller's office analysis. But, because the improvement district does exist, Disney ended up paying roughly "$10.5 million in a contract with the Orange County Sheriff's Office," meaning that they saved "about $10.6 million a year thanks to the tax exemption."

That being said, Disney does currently have to pay property taxes to both Osceola and Orange County each year and is actually the "largest property taxpayer in Orange County currently." According to the Orlando Sentinel, Disney paid "$296.2 million in property taxes for its theme parks in tax years 2015 through 2020" to Orange County (though the Orlando Sentinel reported that, in 2021, Disney was awarded a $7.8 million refund for tax years 2015 through 2019). Other impacts could be a delay in emergency response time on Disney property, as Disney World has its own fire department as an improvement district, and those living in Osceola and Orange County could see an increase in their taxes as the cities would need to provide public services and support to Disney World.

Now, again, it could be quite a bit of time before the act is truly repealed if Florida legislators choose to move forward with action, but we will continue to keep an eye out for any updates and let you know what we see.