Business Implications of Disney v Desantis

Photo by Tyler Nix on Unsplash  

The Reedy Creek Improvement District, a special tax district established in the 1960s, has allowed Disney significant autonomy in governing its properties in Florida, including control over zoning, building codes, and other aspects of governance. However, there has been controversy over whether the district gives Disney too much power and allows it to avoid paying its fair share of taxes.

The long-standing conflict between Disney and Governor Ron DeSantis in Florida stems from the governor's proposed legislation that would significantly increase the state's oversight over the Reedy Creek Improvement District, allowing the state to appoint a majority of the district's board members, diluting Disney's control over the district's operations.

Governor DeSantis argues that the legislation is necessary to ensure that Disney pays its fair share of taxes and that the district is governed democratically. However, Disney has vehemently opposed the legislation, claiming that it would undermine the company's ability to govern its properties effectively and could possibly compromise the quality of its developments. The company has also argued that it has invested significant resources in the district's development over the years and should be allowed to retain a significant level of control.

The conflict between Disney and Governor DeSantis has created a challenging situation for the Florida Chamber of Commerce, a powerful business lobbying group in the state. The Chamber has close ties with both Disney and Governor DeSantis, having donated significant amounts to the governor's political action committee. The Chamber has not officially lobbied against the proposed legislation, which would be viewed as going against Disney's interests. This has put the Chamber in a delicate position, as it risks damaging relationships with either party.

The Chamber's dilemma highlights the challenges that business lobbying groups face when their key allies become involved in disputes. On the one hand, these groups must advocate for the interests of their members, which often align with those of large corporations such as Disney. On the other hand, they must maintain strong relationships with government officials and avoid alienating potential allies in the political arena.

Overall, the outcome of this dispute will have a significant impact on Disney's operations in Florida. If the legislation is passed, Disney will have less autonomy over its properties, potentially affecting the company's ability to implement its own development plans. On the other hand, if the legislation is not passed, Disney may face criticism for avoiding its fair share of taxes and having too much control over local governance.

This conflict raises questions and calls attention to disputes over the role of tax incentives in attracting and retaining large corporations. The question of whether these incentives should be conditional on fair taxation and governance practices is exemplified by the conflict between Disney and Desantis. Ultimately, the outcome of this dispute will have implications not just for Disney and DeSantis, but for businesses and governments throughout the country. The result will set an important precedent for the balance of power between large corporations and state governments, as well as for the use of tax incentives to attract and retain businesses.