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Florida special tax districts like Disney’s Reedy Creek, explained

Hillsborough County has more special districts than any other county in Florida.
Reedy Creek Improvement District Fire Department Station 4, on Wednesday, Dec. 8, 2021.
Reedy Creek Improvement District Fire Department Station 4, on Wednesday, Dec. 8, 2021. [ RICARDO RAMIREZ BUXEDA | TNS/Orlando Sentinel (2021) ]
Published May 24|Updated May 24

TALLAHASSEE — The standoff between Gov. Ron DeSantis and the Walt Disney Co. could have consequences reaching far beyond a battle between two political titans.

Florida is home to more than 1,800 special districts of all shapes, sizes and flavors, from housing and community development districts to quasi-governmental agencies. While none operate quite like Disney’s Reedy Creek Improvement District, their influence is vast — especially in growing metro areas like Hillsborough County, which has more special districts than any other Florida county.

Some state officials have long eyed tightening control over those districts. Post-Disney, they might do just that.

”I think every special district in the state should have to go to a referendum,” Florida House Speaker Chris Sprowls said in April. “Every special district should be evaluated.”

While noting the number of special districts in Florida last week, DeSantis said there is “nothing wrong with a special district.” But after signing legislation last month stripping Disney of its district, the governor also said he would support rules for special districts that ensure “transparency and an even playing field under the law.”

It’s unclear what this could mean for the millions of Floridians served by special tax districts. Some residents might not even realize they belong to such a district — or even if they do, what that district does and what it could stand to lose.

“It’s kind of mind-boggling,” said Mary Mahoney, the special district liaison for Hillsborough County’s management and budget department. “The more districts you layer on top of people, the less and less and less they understand.”

Could Florida’s clampdown on Disney have a ripple effect in your neighborhood? It’s complicated. But we’ll do our best to answer six questions you might have.

What exactly is a special district, anyway?

A special district is a “unit of local government,” according to the Florida Constitution, created by the Legislature or another branch of local government, like a city or county, for a specific purpose.

These districts have the power to issue bonds, levy assessments or charge fees to pay for infrastructure, services or improvements. For example, a community development district can assess homeowners that live inside it to pay for the pipes and sidewalks developers had to build to make the homes livable. The fire district charges taxpayers to put out fires.

If you live in — or are serviced by — a special district, your annual property tax bill may come with an added assessment.

Many are defined by geography, such as a community or residential development. Others are quasi-governmental bodies like water, fire, mosquito control or environmental districts. Examples include Port Tampa Bay, the Hillsborough County Aviation Authority and the Tampa Sports Authority.

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Who do special districts answer to?

They’re state entities, subject to the same transparency and public records laws as other branches of government. They fall into two general categories, which can determine how much influence local municipalities have over their operations.

Independent special districts created by the state generally don’t have local oversight, even if they collect taxes. Port Tampa Bay, for example, is budgeted to collect $10.9 million in revenues from Hillsborough County homeowners this fiscal year. Its seven-member board includes five gubernatorial appointees, along with Tampa’s mayor and one Hillsborough County commissioner.

Dependent special districts have local oversight. Cities and counties approve budgets and can add or remove officers and supervisors, but they otherwise tend to stay hands-off. Those officers are “all basically volunteers,” Mahoney said, and local municipalities generally leave them to their own devices, letting them answer to their own constituents.

“Every once in a while I get a phone call from some resident, a taxpayer in a district, and they’ll be venting to me about what’s going on there, and all I can say is, Go to the board of supervisors,’” Mahoney said. “‘They have public meetings. Go to them.’ Other than that, Hillsborough County and myself have no dog in that hunt.”

There are more than 500 active special districts in the eight-county greater Tampa Bay region that includes Hillsborough, Pinellas, Pasco, Hernando, Citrus, Manatee, Polk and Sarasota counties. Hillsborough has more than 170.

How special is Disney’s special tax district?

The Reedy Creek Improvement District, created by lawmakers in 1967, has the power to create its own fire department. It can seize land via eminent domain even if the land falls outside the district’s boundaries. It has the state’s permission to build a nuclear power plant.

Although no such nuclear power plant exists — even if Disney wanted one, federal approval takes a while — special districts don’t normally have such broad powers.

The district also has the power to create conservation areas, build its own airport, create water and sewage systems, build its own public utilities ... the list goes on. Disney even controls who sits on the five-member board that governs the district.

Does the state treat all theme parks this way?

Local governments have given some special privileges to Disney’s theme park competitors. But none approach the state’s arrangement with Disney.

Universal Orlando sits in a portion of a special district called the Orlando Community Redevelopment Agency. A portion of the property taxes paid by Universal that would normally go toward general government are used to pay for public infrastructure improvements near the park. Local officials created the Universal portion of Orlando’s community redevelopment area in the 1990s to ease congestion around Interstate 4.

“Does Universal benefit from those infrastructure improvements? Yes, because they can get more visitors and a better experience for their tourists,” said Chris McCullion, the City of Orlando’s chief financial officer. “At the end of the day though, had we done nothing, I-4 would just be a parking lot around Universal Studios.”

SeaWorld also sits within a special district. But the two Tampa parks it owns, Busch Gardens and Adventure Island, do not, according to the Hillsborough County Property Appraiser’s Office.

When can governments dissolve a special district?

The governor can suspend any special district officer and, in some cases, appoint a temporary replacement. Municipalities or the Legislature can also dissolve them: Republican lawmakers passed a bill to do just that to Reedy Creek and five other special tax districts by June 1, 2023, during an April special session.

But getting rid of these districts can be tricky. State law says local governments must take over debts from dissolved special districts. Central Florida government officials have said that could be disastrous for local taxpayers, at least in the case of Reedy Creek. The district holds nearly $1 billion in bond debt.

DeSantis gave his first real hint last week about the future of Reedy Creek. Rather than having the district brought under the control of nearby municipalities, he said he’d like to see the state assume jurisdiction over the district. But his office has yet to elaborate.

“Even though there are ways where you could potentially have local communities absorb jurisdiction over Disney, after seeing them threatening to raise taxes on their citizens, we are not going to be in a situation where we’re just going to be giving them, locally, control,” DeSantis told reporters.

Why would the state dissolve a special district?

In the case of Disney, some conservative leaders have said their motivation for dissolving the special district is not political. Others have been more upfront about wanting to punish the company for taking a stand against a bill banning instruction about sexual orientation and gender identity in younger school grades, and limiting the instruction in others.

“Disney betrayed us, and the corporation that Walt Disney started — which was a beacon of family values — has now been perverted by a woke mob of liberal extremists,” Rep. Jackie Toledo, R-Tampa, said last month.

Times political editor Emily L. Mahoney contributed to this story.

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