The City of Anaheim in California has been disputing recently with the Walt Disney Company over proposed benefits that would be given to the theme park by taxpayers. The two have decided to remove an agreement of $267 million in subsidies that Disney would receive if they continue with the plan of a new deluxe resort on their property. This tax break was previously agreed upon after initial hotel proposes were drafted in 2016.
The original plan from Disney was a 700 room resort on the property that is currently a parking lot on Disneyland Drive. Since the approval of the subsidies, Disneyland Resort moved the location of the new proposed four-diamond hotel to a larger space near the Downtown Disney shopping district. The controversy comes with the change of address as the city says the subsidies would only apply to the first hotel location.
After voting to end the agreement for the $267 million in subsidies along with another agreement made back in 2015, Anaheim mayor Tom Tait was quoted as saying “I’ve been opposed to these subsidies for some time now. We need every penny of taxpayer money to pay for vital services. So it really is great of Disney to have done this. They hit the reset button in our relationship.”
The two agreements that are now off the table included Disney keeping 70 percent of the occupancy taxes it would have collected at the new hotel. The other would have prevented the City of Anaheim from introducing a new tax on theme park tickets for 45 years contingent upon Disney investing $1.5 billion at Disneyland. There currently isn’t such a tax on park tickets but the Mayor did acknowledge that it could become a reality in the future now that the agreement is void.
With the taxpayer benefits gone, the new resort is now on an indefinite hold. After the vote this week, a Disney spokesperson said “These tax incentive policies, which are successfully and widely used across the country to stimulate economic growth and development, unfortunately became counterproductive in Anaheim, prompting our decision to step away from them.”
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Source: Hollywood Reporter