- [Reporter] What started as a war of words
between Florida and Disney
over a bill restricting classroom instruction
on gender and sexuality has turned into a battle over
how the company operates in the state.
Walt Disney World Theme Parks sit on a 40-square mile area
near Orlando known as Reedy Creek.
- Reedy Creek, the special benefits district that Disney has
at Walt Disney World in Florida,
it allows them to essentially be their own government.
- [Reporter] In response to Disney's opposition
to the recently-passed Parental Rights in Education law
which critics called the "Don't Say Gay bill",
Florida lawmakers have passed new legislation
that would eliminate Reedy Creek.
Governor Ron DeSantis, who's spoken out against Disney,
has already made clear he'd signed the legislation.
- They do not run this state.
They do not control this state.
- [Reporter] Disney declined to comment
and has so far not publicly responded
to the special district bill.
- It just kind of casts a lot of uncertainty over the future
of Walt Disney World's business model.
- [Reporter] So how has Reedy Creek benefited Disney
over the years?
And what would its disillusion mean
for the company and for Florida?
The Reedy Creek Improvement District was created in 1967,
but the idea for it
came after Walt Disney first identified the land
that would be Disney World.
- As you can see on this map,
we have a perfect location in Florida.
- What Walt wanted to do was two things.
Number one, he wanted to have more control
over who his neighbors were
and what kind of businesses would spring up
around the new Florida resorts and Walt Disney World.
And number two, he wanted to get it done quickly.
- [Reporter] Disney World opened in 1971,
just four years after the creation of Reedy Creek,
making it the first attraction
in what is now a sprawling vacation land
of four theme parks, two water parks,
a sports complex, hotels stores, and restaurants.
- All of those projects, all the additions,
all the growth at Walt Disney World
would've been either much harder or even impossible to do
if not for Reedy Creek
- [Reporter] Reedy Creek allows Disney
to construct new buildings and expand its parks
without having to adhere
to state or county regulations related to construction,
wastewater management, and drainage.
- All of that stuff is irrelevant at Reedy Creek
because Disney is the one that makes those rules.
- [Reporter] Reedy Creek also exempts Disney
from having to pay certain taxes and fees.
While it still pays property taxes
to Orange and Osceola Counties,
which surround its theme parks,
Disney doesn't need to pay
for the services provided by Reedy Creek,
like its fire and emergency services.
- It's all run by Disney.
It's all built by Disney, paid for by Disney,
and run by Disney.
And what that does is it gives a huge amount of flexibility
to the company when they want to expand
and it makes it so that they don't have to employ
as many lawyers and planners to really get things done
when they need to get them done.
- [Reporter] The exact value of these benefits is unclear,
but a person familiar with the company's finances
who studied the issue over a decade ago
said the district saves Disney
tens of millions of dollars every year.
Representatives from Reedy Creek
didn't immediately reply to request for comment.
For Disney, losing Reedy Creek
would not only mean losing those savings,
it would mean losing control.
And for a company trying to provide the kind of fun,
curated experience Disney World strives for,
that's a challenge.
- It's a huge blessing for a company
to not have to live at the whims of elected officials
in the jurisdictions where you operate
and that's kinda how they've been operating
for the past 50 years,
so it would be a huge cultural change as well.
- [Reporter] But eliminating Reedy Creek
could have effect Florida too,
specifically residents in the surrounding counties.
Reedy Creek, like other cities and counties,
carries bond debt, about $977 million worth.
- Right now, it's just one taxpayer, Disney,
that's responsible for it.
If this bill gets passed, then as soon as it takes effect,
that debt will be shouldered by the taxpayers
of Orange County, the citizens of Orlando.
- [Reporter] Mayor Jerry Demings said in a statement,
"Orange County Government
is monitoring the special session in Tallahassee,
particularly when it comes to unfunded cost shifts
to local governments."
And in a statement, Osceola County said
it "will begin an analysis to understand the impacts
in preparation for this going into effect."
Under the bill passed this week,
Reedy Creek would be dissolved on June 1st, 2023,
though Disney could seek to reestablish a special district
after its disillusion.
- I'm sure there's gonna be a big fight,
a lot of lawyers, a lot of lobbyists involved
in trying to figure out some sort of workaround
or a temporary way that this won't be so disruptive.
The new reality is gonna be much more challenging
for Disney in Florida.