News Reedy Creek Improvement District and the Central Florida Tourism Oversight District

[Chip Chipperson]

If you think Disney is going to go the distance to hold the line over this... just so they can believe no one will challenge them again in the future.. You're delusional.

Defending this line item and winning DOES NOT PREVENT THE NEXT ATTACK.
but
Holding the line and stalling potential settlement DOES ensure more cost, more PR nightmares, and emboldening the opposition

Businesses do not operate in absolutes - they have to navigate their paths.

As they say ... 'Pick your battles'

Trying to hold the line over this instead of an agreeable settlement is a comparison no rational executive would take.

I haven't said what I think Disney and RCID will do. It seems as though they are attempting to work on some sort of deal. Whether that deal results in any changes to RCID or is just letting legislators know just how badly they screwed up because they're going to look like idiots when it turns out that the legislation doesn't actually apply to RCID isn't known at this point. It could be that the "compromise" is just that the legislature will repeal the bill (perhaps reintroducing it so that it still applies to the other impacted special districts) so that they aren't embarrassed by a loss in court (something the governor has endured a couple times recently) that can be used against them by their opponents when they are up for re-election. Repealing it can be spun as "we think Disney learned their lesson and realizes that we mean business" and a most people won't even think twice about it considering that the story had largely fallen out of the headlines until Iger was asked about it at his Town Hall and Tucker asked DeSantis about it on his show.

 

[LAKid53]

Any alienating of guests has already occurred. Rolling over and accepting "punishment" (no matter how weak it may seem to those who understand what RCID is) won't suddenly get the hardcore "they're groomers!" crowed to love them again. What it will accomplish, however, is empowering politicians like the governor to think that he can do this whenever he wants if Disney or some other entity dares to speak out against his next piece of legislation. And since the precedent has been set that the governor and legislature will take such actions when situations like this come up, their constituents won't just cheer them when they do it but will expect them to do it each time lest they seem weak and replaceable. Every bit of rhetoric from those who wrote/voted for/signed this legislation has had the message of, "Shut your mouth or we'll shut it for you."

They already are....

However, the next time will affect a significantly wider population of the state than the Reedy Creek decision will. Unfortunately, like RCID, few will understand the ramifications of such decisions. And then the Legislature will spend millions undoing a bad decision.

That special session to dissolve RCID costs hundreds of thousands of dollars. Yet the state continues to ignore the property insurance crisis that with 2 hurricanes in 43 days only exacerbated the problem.

 

[Joel]

Not just Disney.

CFO Patronis just announced the state would be divesting $2B from one of the world's largest asset managers....because of "woke". Think the ripple effect in the markets THAT move will have.

Oh no, not poor BlackRock!

 

[LAKid53]

Oh no, not poor BlackRock!

Pulling $2B from any asset or funds manager will have consequences. And to do it for the reason he stated is foolhardy. If it was performance related, that's one thing. But for "wokeness"?

 

[Vegas Disney Fan]

The problem is, given the current climate and government in Florida, they won't stop with that. See what I just posted about Patronis divesting $2B from BlackRock. Who's next? Vanguard? State Street? BoA? (which holds the state treasury funds - i.e., it's the state's bank). There's a demonstrated agenda on the part of the current runners of the state to punish any corporation they perceive engaging in "wokeness". And the BlackRock decision will impact more than just the decision to dissolve RCID will. Like those participating in the FRS.

I suspect this is being framed heavily by the source, I googled it and the first article made it sound like black rock is investing based on social issues rather than investor returns, if true Florida should 100% stop using them.

If that’s true…this isn’t retaliation like RCID was, it’s good money management by a CFO. If being the billion dollar question…

I read a few more articles and honestly have no idea… I did find this interesting quote in one article though “New York City's comptroller blasted the firm in September, accusing it of not doing enough to fight climate change and issuing a veiled threat that the city would be "reassessing our business relationships with all of our asset managers, including BlackRock, through the lens of our climate responsibilities." Is New York City threatening to pull money from BlackRock because they aren’t left enough somehow different than Florida threatening to pull money from BlackRock because they are too left?

 

[lazyboy97o]

For the sake of argument, let's say that RCID agrees to legislation that revokes its ability to build a nuclear power plant but allows them to retains all other powers they currently hold because they have no intention of ever building and operating their own plant anyway. What do they have to give up the next time a powerful FL politician gets his feelings hurt and wants to try to score some points/campaign donations at Disney's expense? They're already giving up the 1 thing you think they'll never need, so the next concession would have to be something that actually matters - and that cloud is always hanging over their heads because the precedent will have been set.

This though is not the only “compromise” that is apparently being considered. Another is giving the governor seats on the Board of Supervisors. The absolute best case scenario is that these seats have no special powers and are truly outnumbered, that they can express their displease all they want but never hinder the work of the District. Complete do nothing roles. Supervisors thought are still paid by the District for their work. It’s not a lot, but it’s still money being paid out to persons who are almost certain to be allies of whomever is governor. “Pay my associates so money or something bad might happen” is pretty much the description of a protection racket.

That’s also pretty easy to expand. The next time Disney steps out of line their punishment can be another seat on the board. Even if the Board is grown to keep the state in the minority position, it’s all an ongoing financial commitment.

 

[flynnibus]

It’s not a lot, but it’s still money being paid out to persons who are almost certain to be allies of whomever is governor. “Pay my associates so money or something bad might happen” is pretty much the description of a protection racket.

That’s also pretty easy to expand. The next time Disney steps out of line their punishment can be another seat on the board. Even if the Board is grown to keep the state in the minority position, it’s all an ongoing financial commitment.

Yet, it's the most common form of appeasement Boards use .. like Disney adding people to the board to appease some hostile investor.

We all know the slippery slope and 'give 'em an inch' arguments.. it doesn't mean you only ever consider lock-tight things. The whole argument of 'what about next time' can be applied to almost anything. Here, one does not automatically enable the other.

 

[LAKid53]

I suspect this is being framed heavily by the source, I googled it and the first article made it sound like black rock is investing based on social issues rather than investor returns, if true Florida should 100% stop using them.

”Using Florida’s cash to fund BlackRock’s social-engineering project isn’t something we signed up for. It’s got nothing to do with maximizing returns and is the opposite of what an asset manager is paid to do. We’re divesting from BlackRock.”

If that’s true…this isn’t retaliation like RCID was, it’s good money management by a CFO.

If I found out my IRA was investing based on social issues rather than maximizing returns I’d drop them too. Lots of “ifs” though, I don’t know anything about this beyond the one article I read so who knows which spin is the accurate one.

IF the investment strategy of BlackRock resulted in diminishing returns, I might agree. But it's not. Wall Street is throwing cash at BlackRock and demand for it's investment offerings was up in the 3rd quarter.

 

[Vegas Disney Fan]

IF the investment strategy of BlackRock resulted in diminishing returns, I might agree. But it's not. Wall Street is throwing cash at BlackRock and demand for it's investment offerings was up in the 3rd quarter.

Cant disagree with that, I was editing my post after reading a few more articles and politics definitely seem in play, curious if you saw the second quote from New York? Politics is unfortunately intertwined with everything now.

 

[lazyboy97o]

Yet, it's the most common form of appeasement Boards use .. like Disney adding people to the board to appease some hostile investor.

We all know the slippery slope and 'give 'em an inch' arguments.. it doesn't mean you only ever consider lock-tight things. The whole argument of 'what about next time' can be applied to almost anything. Here, one does not automatically enable the other.

This isn’t something happening in isolation. Other ongoing examples have been provided. Across the state government there is an ongoing effort to punish companies for acting in political ways that they dislike. To say it’s unknown if they’ll do it again is silly when they’re in the middle of doing it again.

 

[LAKid53]

I suspect this is being framed heavily by the source, I googled it and the first article made it sound like black rock is investing based on social issues rather than investor returns, if true Florida should 100% stop using them.

If that’s true…this isn’t retaliation like RCID was, it’s good money management by a CFO. If being the billion dollar question…

I read a few more articles and honestly have no idea… I did find this interesting quote in one article though “New York City's comptroller blasted the firm in September, accusing it of not doing enough to fight climate change and issuing a veiled threat that the city would be "reassessing our business relationships with all of our asset managers, including BlackRock, through the lens of our climate responsibilities." Is New York City threatening to pull money from BlackRock because they aren’t left enough somehow different than Florida threatening to pull money from BlackRock because they are too left?

I think you will see a shift towards investment managers that look at more than simply rate of return. Investors, especially institutional ones, will be looking at long term criteria - are they investing in diminishing markets/industries? Emerging markets in countries with unacceptable human rights policies and practices? And what will be driving this will be what the boys on Wall Street say and do, along with the financial press.

There's 2 generations of investors for whom ESG will be important. As their financial assets grow, the investment world will pay attention.

 

[LAKid53]

But what properties are these? Where are they located? Doesn't Disney own all the property within the RCID borders?

No.

 

[LAKid53]

According to News 6, in response to today's Financial Times report, DeSantis' Deputy Press Secretary Jeremy Redfern released the following statement:

Governor DeSantis does not make "U-turns." The governor was right to champion removing the extraordinary benefit given to one company through the Reedy Creek Improvement District. We will have an even playing field for businesses in Florida, and the state certainly owes no special favors to one company. Disney’s debts will not fall on the taxpayers of Florida. A plan is in the works and will be released soon.​

Is he then going to move to abolish the other 1800+ special districts in Florida?

 

[lazyboy97o]

According to News 6, in response to today's Financial Times report, DeSantis' Deputy Press Secretary Jeremy Redfern released the following statement:

Governor DeSantis does not make "U-turns." The governor was right to champion removing the extraordinary benefit given to one company through the Reedy Creek Improvement District. We will have an even playing field for businesses in Florida, and the state certainly owes no special favors to one company. Disney’s debts will not fall on the taxpayers of Florida. A plan is in the works and will be released soon.​

Not much of a Show Win if it’s not reported that way. Fine’s comments also echo the lieutenant governor’s comments early on, suggesting their some expectation of more than just giving up some District authority.

 

[Sirwalterraleigh]

I think you will see a shift towards investment managers that look at more than simply rate of return. Investors, especially institutional ones, will be looking at long term criteria - are they investing in diminishing markets/industries? Emerging markets in countries with unacceptable human rights policies and practices? And what will be driving this will be what the boys on Wall Street say and do, along with the financial press.

There's 2 generations of investors for whom ESG will be important. As their financial assets grow, the investment world will pay attention.

Are you suggesting the return of pre-1997 money shufflers?!?

…I mean…it is a better plan than greed in the short term…

…but I don’t think so. You’re swinging an axe and the trunk of their big, fat money tree

 

[Tom P.]

Pulling $2B from any asset or funds manager will have consequences. And to do it for the reason he stated is foolhardy. If it was performance related, that's one thing. But for "wokeness"?

How is that any different than investors (individual or corporate) who are divesting assets due to ESG considerations? Isn't it just flip sides of the same coin.

 

[MisterPenguin]

Yep, this is all over in multiple places. Here is another:

Florida Republicans Expected to Reverse Decision Stripping Disney of Autonomy over Walt Disney World Property

Florida lawmakers are reportedly preparing to reverse their decision to strip Disney of its authority over the state's Reedy Creek Improvement District.

www.yahoo.com

According to this article lawmakers want to reverse course but the Governor is pushing back so it may not be a done deal yet but I’m optimistic a deal gets done. Remember that getting the political donations flowing again is a big motivation….especially for more local politicians who depend on them.

All these articles are sourcing the Financial Times.

So, not really 'in multiple places.'

Not saying it's not a bad source just not a lot of them.

 

[mmascari]

Chapek makes a good scape goat. Politicians can change course now and point to a change in leadership at Disney for cover. Win/win

I think you’ve found it.

Legislature can point at the removal of Chapek as the win and no longer needing the expense of dissolving the district.

Disney can just not comment on if the removal is related or not. They don’t really want to comment on the details anyway. So they can have it both ways, the change isn’t related, or ”is it”, just no comment.

If the legislature includes the change in some other important thing, the governor can point at the other thing as why the law is signed instead of a veto.

Nothing changes at all, it’s all just spin. A true win-win.

 

[Disstevefan1]

I think you’ve found it.

Legislature can point at the removal of Chapek as the win and no longer needing the expense of dissolving the district.

Disney can just not comment on if the removal is related or not. They don’t really want to comment on the details anyway. So they can have it both ways, the change isn’t related, or ”is it”, just no comment.

If the legislature includes the change in some other important thing, the governor can point at the other thing as why the law is signed instead of a veto.

Nothing changes at all, it’s all just spin. A true win-win.

This makes perfect sense. TWDC AND Florida needed a way out of the RCID mess.
A mess created by BOTH sides.
Chapek is the sacrificial lamb.

 

[lazyboy97o]

If Disney took Florida to court over say that and lets say they won and Florida appealed the decision and it went to the Supreme Court giving its current leaning it would almost assuredly overturn the previous ruling that corporations are people.

Thus the only meaningful option for Disney to announce they are moving away from policies of that the Florida legislature think are 'woke'. Then Ron gets his win and Disney gets its win.

Corporate personhood is established well beyond a single case, and was not decided in Citizens United. The idea that people cannot get together as a group and express political opinions is completely antithetical to the notions of free speech and free association.