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Disney blocked DeSantis' oversight board. What happens next?

An entranceway to Walt Disney World pictured on Feb. 08 in Orlando, Florida. Disney quietly blocked a move by Florida Gov. Ron DeSantis to strip the company of its control over a special taxing district.
Joe Raedle
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Getty Images
An entranceway to Walt Disney World pictured on Feb. 08 in Orlando, Florida. Disney quietly blocked a move by Florida Gov. Ron DeSantis to strip the company of its control over a special taxing district.

Updated March 30, 2023 at 3:15 PM ET

Florida Gov. Ron DeSantis, Walt Disney World and a special tax district are once again making headlines, but this time, it's with a new cast member: England's King Charles III.

In a quiet move that's enchanting the internet, the former Reedy Creek Development board signed its power back to Disney before leaving office, a binding declaration that doesn't expire until England's monarchy dies out.

That means the five DeSantis allies who pledged to rein in one of Florida's largest employers lack the ability to do much of anything, at least until they take legal action.

Here's a look at what's going on and what could come next.

First, a quick refresher on the Disney-DeSantis feud

Things started heating up back in 2020, when Disney enacted COVID-19 masking measures and, later, vaccine mandates. Tensions reached a tipping point when Disney sided against Florida's Parental Rights in Education Act, known by its critics as the Don't Say Gay bill.

Last month, in a move widely seen as retaliation, DeSantis signed a bill that took control of a special tax zone encompassing Walt Disney World. The Reedy Creek Development District has allowed Disney to operate and expand with a lot of autonomy for the last 50 years.

The governor gave it a new name, the Central Florida Tourism Oversight District, and appointed five of his allies to the board, including a prominent parents' rights activist, a Christian nationalist and a lawyer who donated $50,000 to his campaign.

On paper, the new board would supervise municipal services and development for the land around Disney World. In practice, DeSantis said, the board would also serve as a moral arbiter for a company that had lost its way.

One of the board members told NPR in early March that its first step would be conducting a sweeping financial and legal audit into Disney's behavior.

But, unbeknownst to the governor, Disney had already cut the board's powers

A sign near the entrance of the Reedy Creek Improvement District administration building is seen in early February.
John Raoux / AP
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AP
A sign near the entrance of the Reedy Creek Improvement District administration building is seen in early February.

The newly appointed board was sitting for its second official meeting on Wednesday when it announced it had made a discovery: It might not be able to carry out the agenda it planned.

Nineteen days before DeSantis signed the final bill, the former board had signed agreements with Disney essentially stripping the board of power and handing that power back to Disney.

Called a Declaration of Restrictive Covenants, the measure allows Disney to have the final say on any alterations to the property and requires the board to inform Disney of plans for such alterations without conditions or delays.

Basically, the board loses "the majority of its ability to do anything beyond maintain the roads and maintain basic infrastructure," as board member Ron Peri put it, according to local news outlet Click Orlando.

And, in an extra detail that the internet is devouring, the term of the agreement was set using the "Rule Against Perpetuities" — which states that a policy will continue until after a certain person dies.

In this case, the declaration will continue "until twenty one (21) years after the death of the last survivor of the descendants of King Charles III." DeSantis, after all, frequently refers to Walt Disney World as a "corporate kingdom."

Savvy social media users also pointed out that the tactic resembled one that Republicans have used following recent election losses. In places like Arizona, Michigan, North Carolina and Wisconsin, GOP-led legislatures overhauled state election laws, shoring up their party power before handing the reins over to incoming Democratic majorities.

In a statement provided to NPR, Disney said the move was "appropriate" and "approved in open, noticed public forums in compliance with Florida's Government."

To top it all off, no one seemed to notice this very public occurrence

As far as power moves go, this one does appear to be above board. A detailed note about the Restrictive Covenant clause was recorded in the Feb. 8 Reedy Creek agenda and meeting minutes. A day later, the agreement was registered with the Orange County Comptroller.

All of those documents were, and still are, available online, no public records request needed. Anyone could've attended the old board's meeting on Feb. 8. (There were no public comments on the measure, which the board unanimously approved.)

The Walt Disney World resorts and surrounding district, seen in an aerial view last month. Gov. DeSantis's office thinks that it might be able to strike down the restrictive Covenant based on legality alone.
Joe Raedle / Getty Images
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Getty Images
The Walt Disney World resorts and surrounding district, seen in an aerial view last month. Gov. DeSantis's office thinks that it might be able to strike down the restrictive Covenant based on legality alone.

And, yet, no one seemed to notice — or if they did, they didn't raise an alarm. Not the new board, not the governor, not the legislators or the reporters actively monitoring developments (guilty).

When news outlets, including NPR, asked Disney for comment about the various steps of DeSantis's takeover throughout February, the company played it straight-faced, saying it wouldn't fight the takeover.

"For more than 50 years, the Reedy Creek Improvement District has operated at the highest standards, and we appreciate all that the District has done to help our destination grow," said Walt Disney World Resort President Jeff Vahle in a statement. "We are focused on the future and are ready to work within this new framework."

So what happens next? Can the board take power back?

The Restrictive Covenant is binding, meaning Disney could easily sue the board for legal damages if it tries to overstep its powers.

And it's only severable "if any clause or provision" is "illegal, invalid or unenforceable under applicable present or future laws."

DeSantis' office thinks that it might be able to strike down the Covenant based on legality alone.

"The Executive Office of the Governor is aware of Disney's last-ditch efforts to execute contracts just before ratifying the new law," said Communications Director Taryn Fenske in a statement shared with other outlets. "An initial review suggests these agreements may have significant legal infirmities that would render contracts void as a matter of law."

DeSantis's office did not immediately respond to NPR's request for comment and clarification.

Worst case, could DeSantis just pass a new law? Maybe, but any law that more broadly takes action against restrictive covenants or special districts could have wider-reaching consequences that DeSantis may want to avoid.

One of the governor's earlier plans to dissolve all special tax districts in the state fell apart after analysts pointed out that doing so might ultimately raise taxes for the counties next to Reedy Creek, frustrating local residents.

In the end, the board could be left to pursue a legal challenge to the Covenant, which could still take months to sort out in the courts.

The board hired four outside law firms to look into the contract, including Cooper & Kirk. DeSantis has paid millions to the boutique Washington, D.C., firm to help defend several controversial policies, according to reporting from the Orlando Sentinel.

NPR reached out to members of the board for comment but had not received a reply by the time of publication. Bridget Ziegler, one of the more high-profile members, said on Twitter that the board "won't stand for this" and "won't back down."

Copyright 2023 NPR. To see more, visit https://www.npr.org.

Emily Olson
Emily Olson is on a three-month assignment as a news writer and live blog editor, helping shape NPR's digital breaking news strategy.
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