MercoPress. South Atlantic News Agency

Disney shares plummet as Florida ends company's privileges

Disney's advantages in the State of Florida will expire June 1, 2023

Florida's Republican Governor Ron DeSantis Friday signed into law the bill revoking Walt Disney Co.'s special self-governing status in the area around its Orlando theme parks, it was announced.

Disney's privileges, which included tax advantages, dated back to the 1960s. According to the new law, they will expire June 1, 2023.

“They have the ability to build a nuclear power plant without state consent if they want to,” DeSantis said. “No individual or no company in Florida is treated this way, and it's not right to have this similar treatment, but you know they had wielded a lot of power over the years.”

Despite warnings from Orange County leaders and other experts that the measure would cause financial chaos, raise local taxes, and affect services, DeSantis insisted that “we have it all figured out.”

“Don't let anybody tell you that somehow Disney will get a tax break for this, they'll pay more taxes as a result of that,” he added.

DeSantis took aim at Disney, one of the state's largest employers, after company executives criticized him for signing a bill preventing schools from teaching gender identity and sexual orientation in kindergarten through third grade. Republicans in the Florida Legislature quickly responded by passing a bill to remove Disney's special status.

After hitting an all-time high in March 2021, trading at nearly US$ 200 per share, Disney stock plummetted to nearly US$ 120 per share Friday.

Disney CEO Bob Chapek, 61, was harshly criticized for the current situation. Disney is also bogged down by waning investor enthusiasm for streaming services. Netflix shares fell 35% this week on news that the streaming platform had lost 200,000 subscribers.

The company's special district, which was created by a 1967 state law, allows Disney to self-govern by collecting taxes and providing emergency services (fire, Police, waste collection).

Disney controls some 25,000 acres in the Orlando area, and the district allows the company to build new structures and pay special fees for such construction, without the approval of a local planning commission.