CEO Bob Chapek has discovered the position few leaders of large corporations that must appeal to a wide audience ever desire. He had to either take a political stand against Gov. Ron DeSantis' "Don't Say Gay" bill, which limits the ability for LGBTQ issues to even be acknowledged in schools, or not take one.
It's an impossible situation for a company that wants to be loved by everyone. Disney has not been shy about its support for its LGBTQ employees and has welcomed that community to its Florida resorts. Disney has also made donations in Florida on both sides of the aisle and generally tried to have its cakes and eat it.
DeSantis has made this impossible. Chapek tried to, but the inflammatory nature of the legislation forced Disney's employees to take a stand.
I know that many people are concerned that we did not speak out against the measure, Chapek said during the company's annual shareholder meeting. We were opposed to the measure from the start, but we decided not to take a public opinion on it because we believed we might be more effective working behind the scenes, interacting directly with legislators on both sides of the aisle.
He had to do it, but Chapek (and DeSantis) thought that doing so would put Disney in front and center in so-called "culture conflicts."
Disney is being punished by DeSantis (Sort of, Not Really)
The United States has become very divided politically, but a stand against Disney for being "woke" isn't that much different from Democrats taking on Big Oil or tobacco companies. The goal is to create an enemy so voters who agree with you may see you as a hero. Without acknowledging that Bernie Sanders and other left-leaning politicians have used the same tactics.
To "take on" Disney, DeSantis and the heavily Republican Florida legislature voted to revoke Disney World's title as a special tax district. Basically, the Reedy Creek Improvement District (RCID) allowed Disney to essentially regulate its 25,000-acre property.
Disney was forced to pay for paramedics and firefighters. If the district was abolished in June 2023 (which is very unlikely given the actual power Florida's legislature) it means that the cost of those services would now be carried by the state's tax payers.
If the RCID was abolished, it would cost Florida somewhere between $1 billion and $2 billion a year. It's a huge bill and a significant organization that would have to be built to provide health and safety as well as utility services for the massive Walt Disney World property.
DeSantis knows that will not happen, and the actual intention of actually dissolving the RDIC is certainly not to him.
What is Ron DeSantis doing with Disney?
The legislation also puts tens of thousands of people in danger (sort of), but does not anticipate that.
"There's zero chance that Florida's action results in the permanent elimination of the RCID," he said. "Disney will have full public safety protection in June 2023 and onwards, and should be able to continue normal operations without interruption. This legislation is political theater designed to create an illusion of DeSantis punishing The Walt Disney Company without inflicting any real financial damage to Disney."
Niles, who has covered Disney for decades, said that the corporation would likely save money if it did not have to operate the RCID. He added that if the special district were abolished, "Disney might save up to a reported $100+ million a year in taxes that it pays to the RCID."
Disney, according to the author, "already pays property taxes to Orange and Osceola counties," and those counties cannot just target Disney for additional taxes to cover the cost of supporting the resort."
The reality is that the legislature and DeSantis would likely not be able to do anything to Disney's special district status.
Special districts created by the legislature should only be dissolved with a majority vote of the district's landowners, according to a Florida law. For Reedy Creek, that's the Walt Disney Company.
"If Florida wanted to scare Disney, it would keep the RCID, rather than pay $500 million in tax benefits that it is charging to relocate 2,000+ Disney Parks employees from California to Florida. "There hasn't been a word from DeSantis or any of his allies about doing that, which, for me, is the case here."