4 ms·

I suspect there's a way to eliminate Reedy Creek district. I don't think it's the law stopping the dissolution of the district -- it's that no one important in

I suspect there's a way to eliminate Reedy Creek district. I don't think it's the law stopping the dissolution of the district -- it's that no one important in the state seriously wants to do that. Who does it benefit?

gamblor956 4y ago
There is: the state of Florida can pay off the debt. All at once. That is the only legal way to do it without endangering all of Florida's other debt (bonds, etc.).
- fnordpiglet 4y ago
  The local community can’t afford to assume the districts responsibility even if the bond debt is assumed by the state.
  - leereeves 4y ago
    Wouldn't the local community collect a lot more taxes if the district didn't exist? As I understand it (admittedly not very well), right now Disney is effectively "paying taxes" to itself.
    - mikeryan 4y ago
      That's actually covered in the article. "Mills" is the term of art for the amount levied in property taxes. Reedy Creek has the ability to tax at 30mills and currently taxes at 13.67 (1/3 of which goes to paying the debt) the counties are limited to only taxing at a rate up to 10 mills (and are currently at about ~7 mills (Osceola) and ~5 (Orange) so there's a 3.67 shortfall they can't make up and another 3-5 which they currently don't. The added revenue to the counties would be far short of the amount they'd need to provide the current services and service the debt. Osceola Millage Rates https://www.property-appraiser.org/final-millage-rates/ https://www.property-appraiser.org/final-millage-rates/ Orange Millage Rates https://ocpaweb.ocpafl.org/faqcontent/Taxroll_Info#A404411 https://ocpaweb.ocpafl.org/faqcontent/Taxroll_Info#A404411
      - leereeves 4y ago
        > currently taxes at 13.67 (1/3 of which goes to paying the debt) So they'd need about 9 mills (2/3rds of 13.67) to pay expenses without the debt? It's likely that they could make up the shortfall by reducing some services. Any services that the local community didn't want to pay for and the Disney company still wanted, Disney could pay for itself. I also wonder if the the district is fairly valuing the land. How much would a hotel be willing to pay for an acre near the park, and is that the valuation the district uses?
- leereeves 4y ago
  Each time I learn more about it, this arrangement seems crazier. It was strange enough that private companies are allowed to run their own local governments in Florida. Now it turns out they're also allowed to issue tax advantaged municipal debt, and transfer that debt to taxpayers if this sweet deal ever ends. It's true that Reedy Creek is being singled out because Disney has fallen out of favor, but I'm still hoping there is some flaw in this arrangement that leads to the end of all special districts now that people are paying attention.
  - mikeryan 4y ago
    Disney built a world class destination in the middle of, what is basically, a swamp. They built all the necessary infrastructure and paid for it by taxing themselves. In a lot of ways it put Orlando on the map and provided a huge boost to the surrounding economy. I'm not sure who was getting screwed there? It honestly seems like it was a win/win situation.
    - leereeves 4y ago
      > I'm not sure who was getting screwed there? Here's one: normally corporate bond payments are federally taxable, but municipal bonds aren't. Everyone in the country is missing out on taxes on payments on that 2 billion dollar debt.
      - mikeryan 4y ago
        Yeah but that’s a chicken and egg problem. Those bonds wouldn’t exist without the current exemption.
  - SauciestGNU 4y ago
    You and I talked about this the other day, and I walked away from this article further convinced that improvement districts are an abomination to the concept of democracy and must be ended. To these ends I think it would be smart for some politician to say "I don't think this bill goes far enough" and propose legislation to dissolve every improvement district.

gamblor956 4y ago

There is: the state of Florida can pay off the debt. All at once. That is the only legal way to do it without endangering all of Florida's other debt (bonds, etc.).

fnordpiglet 4y ago
The local community can’t afford to assume the districts responsibility even if the bond debt is assumed by the state.
- leereeves 4y ago
  Wouldn't the local community collect a lot more taxes if the district didn't exist? As I understand it (admittedly not very well), right now Disney is effectively "paying taxes" to itself.
  - mikeryan 4y ago
    That's actually covered in the article. "Mills" is the term of art for the amount levied in property taxes. Reedy Creek has the ability to tax at 30mills and currently taxes at 13.67 (1/3 of which goes to paying the debt) the counties are limited to only taxing at a rate up to 10 mills (and are currently at about ~7 mills (Osceola) and ~5 (Orange) so there's a 3.67 shortfall they can't make up and another 3-5 which they currently don't. The added revenue to the counties would be far short of the amount they'd need to provide the current services and service the debt. Osceola Millage Rates https://www.property-appraiser.org/final-millage-rates/ https://www.property-appraiser.org/final-millage-rates/ Orange Millage Rates https://ocpaweb.ocpafl.org/faqcontent/Taxroll_Info#A404411 https://ocpaweb.ocpafl.org/faqcontent/Taxroll_Info#A404411
    - leereeves 4y ago
      > currently taxes at 13.67 (1/3 of which goes to paying the debt) So they'd need about 9 mills (2/3rds of 13.67) to pay expenses without the debt? It's likely that they could make up the shortfall by reducing some services. Any services that the local community didn't want to pay for and the Disney company still wanted, Disney could pay for itself. I also wonder if the the district is fairly valuing the land. How much would a hotel be willing to pay for an acre near the park, and is that the valuation the district uses?
leereeves 4y ago
Each time I learn more about it, this arrangement seems crazier. It was strange enough that private companies are allowed to run their own local governments in Florida. Now it turns out they're also allowed to issue tax advantaged municipal debt, and transfer that debt to taxpayers if this sweet deal ever ends. It's true that Reedy Creek is being singled out because Disney has fallen out of favor, but I'm still hoping there is some flaw in this arrangement that leads to the end of all special districts now that people are paying attention.
- mikeryan 4y ago
  Disney built a world class destination in the middle of, what is basically, a swamp. They built all the necessary infrastructure and paid for it by taxing themselves. In a lot of ways it put Orlando on the map and provided a huge boost to the surrounding economy. I'm not sure who was getting screwed there? It honestly seems like it was a win/win situation.
  - leereeves 4y ago
    > I'm not sure who was getting screwed there? Here's one: normally corporate bond payments are federally taxable, but municipal bonds aren't. Everyone in the country is missing out on taxes on payments on that 2 billion dollar debt.
    - mikeryan 4y ago
      Yeah but that’s a chicken and egg problem. Those bonds wouldn’t exist without the current exemption.
- SauciestGNU 4y ago
  You and I talked about this the other day, and I walked away from this article further convinced that improvement districts are an abomination to the concept of democracy and must be ended. To these ends I think it would be smart for some politician to say "I don't think this bill goes far enough" and propose legislation to dissolve every improvement district.