Florida House approves plan to give DeSantis new power over Disney

(CNN) — Florida lawmakers voted Thursday to give Gov. Ron DeSantis new power over the state’s most iconic theme parks amid his ongoing feud with Disney.

Under a fast-tracked bill that could be headed to the Republican governor’s desk by the end of the week, the state would take over the Reedy Creek Improvement District, the 55-year-old government body that has effectively given Disney control over the land around its Orlando-area theme parks. The district’s existing board, made up of individuals with close ties to Disney, would be replaced by a five-member board hand-picked by DeSantis.

The state House, where Republicans hold a supermajority, passed the measure on an 82-31 vote. The GOP-led state Senate is expected to take up the bill within the next 36 hours. If the measure passes the chamber, it will go to DeSantis for final approval. He is expected to sign it.

"There’s a new sheriff in town, and that’s just the way it’s going to be," DeSantis said at Wednesday news conference.

Democrats on Thursday warned that DeSantis could wield his board picks over Disney executives if he clashes again with the entertainment giant as he continues his crackdown on "wokeness."

State Rep. Rita Harris pointed to Disney recently changing its Splash Mountain ride to remove references to racist themes, a move that sparked some conservative backlash. It will become Tiana’s Bayou Adventure, a ride celebrating Disney’s first Black princess.

"What if the governor didn’t like that?" Harris asked during debate. "Would the board then be able to push a company into changing their business model just so that they don’t misalign them? This is not the free markets."

The move to take over Reedy Creek is the latest step in a yearlong spat between DeSantis and Disney over a bill to restrict certain classroom instruction about sexual orientation and gender identity. DeSantis signed the bill into law over the objections of Disney’s then-CEO Bob Chapek. Disney in a statement vowed to help get the law repealed or struck down by the courts.

DeSantis responded to the threat by calling on lawmakers to strip Disney of its special governing powers, which they did in a special session last year, voting to dissolve the Reedy Creek Improvement District at the end of May 2023.

However, while DeSantis quickly turned his takedown of Disney into fodder for stump speeches and fundraising emails, lawmakers at the time failed to address what would come next for the special district. Neither DeSantis nor lawmakers outlined a plan to unwind a half-century of Disney control or for how to ensure Orange and Osceola county residents wouldn’t be on the hook for funding Reedy Creek services or its $1 billion in debt. Amid the fallout, Reedy Creek told its bondholders that Florida could not dissolve the district without assuming its debts or it would violate the 1967 state law that created the district. Fitch Ratings Group put Reedy Creek Improvement District’s debt on watch for a negative bond rating.

The bill introduced this week in a special session of the Florida legislature would keep Reedy Creek alive, albeit under a new name, the Central Florida Tourism Oversight District, and with a DeSantis-aligned board in charge. The legislation makes clear that the changes to Reedy Creek should not affect the district’s existing debt or contracts and would extend the life of the district beyond June.

The final page of the 189-page bill states: "The Reedy Creek Improvement District is not dissolved as of June 1, 2023, but continues in full force and effect under its new name."

In a statement to CNN earlier this week, Jeff Vahle, the president of Walt Disney World Resort, said the company is "monitoring the progression of the draft legislation, which is complex given the long history of the Reedy Creek Improvement District."

"Disney works under a number of different models and jurisdictions around the world, and regardless of the outcome, we remain committed to providing the highest quality experience for the millions of guests who visit each year," Vahle said.

Michael Rinaldi, the head of local government ratings at Fitch, said the bill "appears to address key uncertainties created following last year’s dissolution legislation" and would likely resolve the negative bond rating watch.

The Reedy Creek special district encompasses about 25,000 acres in Orange and Osceola counties and includes four theme parks, two water parks, one sports complex, 175 lane miles of roadway, 67 miles of waterway and the cities of Bay Lake and Lake Buena Vista, its website says. The arrangement has allowed Disney to grow into a massive mecca for family-friendly tourism and a primary driver of Central Florida’s economy, using the district’s unique borrowing and taxing powers to build infrastructure around the theme parks.

Under existing law, the board for Reedy Creek has been made up of landowners with close ties to Disney. The bill introduced Monday makes clear that none of the appointees chosen by the governor can be recent Disney employees or their relatives, nor that of a competitor. The state Senate, where Republicans also hold a supermajority, would have final approval of the appointees.

"We’re taking one problematic swamp and we’re creating another swamp by allowing for one person to appoint all five positions," said Rep. Anna Eskamani, an Orlando Democrat who authored an unsuccessful amendment to get local elected leaders on the board. "And the only reason I can see is because Disney made the governor big mad by defending LGBTQ+ kids."

The bill would keep many of the district’s existing powers, though it would end certain never-exercised capabilities to build an airport or a nuclear power plant and would limit the use of eminent domain outside the district’s boundaries to seize land that could be used to benefit Disney.

"This is something that we should have done as a legislature decades ago," Republican state Rep. Randy Fine said Thursday. "But because of the power of corporations, we could not. Today we make the playing field equal."

This story and headline have been updated.

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