Disney has trumped Ron DeSantis with an obscure legal loophole, stripping power from the oversight board he had put in place to control the Florida theme park.
The dispute between Walt Disney Company and the state governor erupted in March 2022, when DeSantis passed his ‘Don’t Say Gay’ bill, banning classroom teaching on gender identity.
Disney initially resisted the law – relying on special legal privileges it has held for decades at the so-called Reedy Creek Improvement District, which covers the 40 square miles of land owned by the corporation.
DeSantis moved to revoke these self-governing privileges by imposing his own board to run the district. However, the Governor appears to have had the rug pulled from under him after last-minute agreements were filed by Disney to prevent his officials from taking power.
Sensationally, the dossier states that the provisions will remain in place until ’21 years after the death of the last survivor of the descendants of King Charles III, king of England living as of the date of this declaration’.
This ‘last survivor’ is one-year-old Princess Lilibet of Sussex, who lives in California.
The so-called ‘Royal clause’ is used by lawyers to avoid rules against contracts which last in perpetuity. The British Royals were selected because information about their family tree is readily available, and because the family generally have ‘longer life expectancy,’ according to law firm Bricketts.
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Members of the Central Florida Tourism Oversight District, handpicked by the governor to oversee Disney’s special self-governing district, said the agreement made by former board members has left them effectively powerless
Ron DeSantis officially took control of the area, formerly known as the Reedy Creek Improvement District, earlier this year, amid an ongoing power struggle between his state and the corporate behemoth
Perhaps most sensationally, the agreement hinges on a bizarre legal loophole referencing King Charles III – saying that even if the deal is deemed to violate rules against perpetuity, it will remain in effect 21 years after the deaths of the last surviving descendants of British monarch
The new board – handpicked by DeSantis – says this backdoor agreement has left them powerless and unable to run the now renamed Central Florida Tourism Oversight District.
Made between park brass and the on-the-way-out Central Florida board earlier this year, the development deal transfers much of the district’s power to the Walt Disney company for the next three decades, lawyers hired by the district claim.
They say the agreement was made in secret, and allows Disney to build another park within the confines of the 40-square mile area governed by the Central Tourism Oversight District board, formerly known as Reedy Creek.
The new board – appointed by the Republican governor in retaliation for the entertainment giant’s public opposition to his ‘Don’t Say Gay’ bill – further alleges the new, 30-year deal gives the company the option of building a series of smaller theme parks, and demotes the five-member board to no more than a figurehead.
‘We’re going to have to deal with it and correct it,’ board member Brian Aungst said Wednesday. ‘It’s a subversion of the will of the voters and the Legislature and the governor. It completely circumvents the authority of this board to govern.’
The development is the latest in an ongoing struggle between DeSantis’s office and the entertainment behemoth – which is once again headed by Bob Iger, and whose main theme park, Disney World, for the past 55 years had largely been left to its own devices.
That, however, changed in February, when DeSantis officially took control of the Reedy Creek Improvement District, marking the ‘corporate kingdom coming to an end’ as he vowed to make the firm pay its fair share of taxes, due to a special zoning status that has saved it billions over the years
With a stroke of his pen, the Republican governor instilled his brand-new board, who in turn revealed on Wednesday that a hired special council had discovered the agreement – which Disney claims is in accordance with state law.
Board members, however, insist otherwise, saying it was made without their knowledge weeks ahead of the signing of DeSantis’s latest bill, officially HB-9B.
‘I cannot tell you the level of my disappointment,’ board member Ron Peri said during Wednesday’s meeting of the legal maneuver, which counters DeSantis’s attempts to do away with Disney’s special self-governing status.
‘I thought so much better of [Disney]. This essentially makes Disney the government.’
A ‘declaration of restrictive covenants’, board members added, prohibits the district from using Disney’s name, Mickey Mouse and other characters associated with the $180billion corporation without Disney’s explicit approval.
The Reedy Creek Improvement District stretches for nearly 40 square miles and includes the entire Walt Disney World Resort. It will be renamed the Central Florida Tourism Oversight District under the new bill
The bill leaves the district intact but would change Reedy Creek’s name and require DeSantis to appoint a five-member governing board
The meeting saw lawyers hired by board members announce their intent to fight the multi-decade agreement, which contained one stipulation – that some are calling a legal loophole – referencing the recently crowned royal
It also requires Disney sign off on any logistical changes to the 27,000-acre area’s infrastructure – which board members said during Wednesday’s televised meeting left them at a loss as to how to govern the region.
‘This board loses, for practical purposes, the majority of its ability to do anything beyond maintain the roads and maintain basic infrastructure.’
The meeting saw lawyers hired by board members announce their intent to fight the multi-decade agreement, which contained one stipulation – that some are calling a legal loophole – referencing the recently crowned royal, often used to circumvent laws that last in perpetuity.
‘[T]his Declaration shall continue in effect until twenty one (21) years after the death of the last survivor of the descendants of King Charles III, King of England,’ the document penned on February 8 reads.
The restriction, while somewhat bizarre, serves as a longstanding legal tradition known as Royal Clauses, which demands covenants be tied to the lifespan of a person living at the time the guidance is signed, plus 21 years.
Named for the British royal family, the distinction was chosen due to information about the regal family tree being generally available to the public, and able to be used as a benchmark.
Moreover, the family was also chosen to represent the concept because of the ‘better healthcare available to, and longer life expectancy of, a royal family member compared to a non-royal’, law firm Birketts explained.
People gather at the Magic Kingdom theme park before the ‘Festival of Fantasy’ parade at Walt Disney World in Orlando, Florida
Often used in relation to trusts and options to acquire property, the legal maneuver was created to circumvent laws that last in perpetuity, and to maximize the possible length of time for which trusts in particular could subsist.
In this particular case, that time period – if not overturned – could be a considerable number of years, with Charles’s youngest living descendant, Princess Lilibet, only aged one.
Social media users have since taken notice of the bizarre benchmark, with the hashtag #longlivelilibet trending on Twitter Wednesday after the board laid the contents of the February 8 document bare.
During that meeting, board members decried their predecessors for using the clause to extend their covenant as long as possible by tying it to the royal family’s lineage at the last possible moment, preventing DeSantis’ team from taking full control.
If the agreement is deemed to violate rules against perpetuity, it will be in effect until 21 years after the death of the last surviving Charles descendant alive today.
Disney World is the largest employer in central Florida with close to 75,000 employees, drawing 36.2 million visitors in 2021, according to the Themed Entertainment Association.
The legislature voted last year to dissolve the special district, which for more than a half-century had provided Disney with the autonomy to govern itself, providing such government services as fire protection, water, sewer and waste removal services and infrastructure.
The action, seen as retaliation for Disney’s then-Chief Executive Officer Bob Chapek speaking out against a state law limiting classroom discussion of LGBTQ issues, came with unintended consequences.
Tax experts and legislators warned that eliminating the district in June 2023 would leave county taxpayers liable for nearly $1.2 billion in bond debt.
The new bill preserves the Reedy Creek special district, though within two years it will be renamed Central Florida Tourism Oversight District.
It will have the authority to collect revenue, pay off debt and provide a range of government services. The district is prohibited from operating its own airport or building nuclear power plants.
The legislation also expressly prevents anyone with ties to the theme parks over the past three years from serving on the board.
‘Disney works under a number of different models and jurisdictions around the world,’ Walt Disney World President Jeff Vahle said in a statement.
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‘And regardless of the outcome, we remain committed to providing the highest quality experience for the millions of guests who visit each year.’
Florida Senator Geraldine F. ‘Geri’ Thompson, whose district includes Orlando, said she worries the governor’s appointees will reflect DeSantis’ views on diversity and inclusion.
Last year, DeSantis championed a law known was the ‘Stop W.O.K.E.’ act, that restricted conversations about race in schools and workplace training. A federal judge blocked it from taking effect in the state’s public universities.
‘I’m concerned that with his emphasis on eliminating diversity, equity and inclusion, if he’s going to try to get into the programmatic side of Disney,’ Thompson told Reuters.
DeSantis’ Disney district takeover was initiated last year, after Disney publicly opposed another law he championed, which bars instruction on sexual orientation and gender identity in kindergarten through third grade.
DeSantis moved to penalize the company, directing lawmakers to dissolve the district during a special legislative session in April, beginning a closely watched restructuring process.
