Fitch says Disney Reedy Creek bill likely fixes bonds issue
After raising concerns last year about Florida’s move to dissolve the Reedy Creek Improvement District, Fitch Ratings indicated Tuesday that new legislation could resolve the issues.
A House bill proposed Monday would undo the dissolution and give power to Gov. Ron DeSantis to appoint the board of the taxing district, which was created in 1967 and essentially let Walt Disney Co. control issues such as land use, fire protection and sewer services typically handled by local governments.
The bill (HB 9B) also would change the name of Reedy Creek to the Central Florida Tourism Oversight District. But the district would continue to have wide-ranging authority, including the ability to levy property taxes and fees, issue bonds and provide services.
Last year, Fitch placed what is known as a “rating watch negative” on Reedy Creek because of concerns about how $1 billion in bonds would be paid if the district were dissolved. But in a statement Tuesday, Michael Rinaldi, head of local government ratings at Fitch Ratings, indicated that the new bill could clear up the concerns.
“The bill appears to address key uncertainties created following last year’s dissolution legislation, primarily, preserving the revenue-raising powers of the district and its ability to service its outstanding indebtedness, which would be valid and binding on the CFTOD (Central Florida Tourism Oversight District).” Rinaldi said.
Lawmakers voted last year to dissolve Reedy Creek after Disney angered DeSantis by publicly opposing a law that restricts instruction about gender identity and sexual orientation in schools. But the dissolution would not take effect until June 1, 2023, giving lawmakers time to re-establish the district and make changes.
The bill was filed as part of a special legislative session that started Monday.