Anaheim to Continue Protecting Disney From Entertainment Taxes

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Anaheim and Disneyland are set to sign a deal that would protect the mega-resort from paying entertainment taxes, a notice published in the Anaheim Bulletin indicates.

According to a city news release, the 30-year deal would require the city to reimburse Disneyland for any entertainment taxes levied on the resort. In exchange, Disneyland would embark on an expansion of the resort valued at $1 billion and completed by Dec. 31, 2024, the release states.

The agreement, up for a council vote at its July 7 meeting, would extend a current reimbursement requirement on entertainment taxes that goes back to 1996 and runs through 2016. That deal was part of a half-billion dollar expansion of the resort district.

City officials are pitching this new deal as an investment that will increase tax revenue due to the additional tourism from Disneyland’s investment. The news release claims a KPMG study completed for Disneyland shows the proposed resort expansion would result in $600 million in new revenue over the next 40 years.

“This proposed entertainment tax policy is a pragmatic way to facilitate investment and future revenue for City services,” Interim City Manager Paul Emery states in the news release.

Anaheim Mayor Tom Tait disagrees. He says the decision would “bind the hands” of future generations from being able to tap the largest financial well in the city during times of fiscal duress.

Tait pointed out that the city’s future budgets could be burdened by pension obligations and tax subsidies for hotels. He compared the possibility of an entertainment tax to a family “insurance policy.”

“Hopefully there won’t be a need. But if there is, the people, this City Council, should not give away that ability” to levy an entertainment tax, Tait said.

Disneyland officials refused to be interviewed by Voice of OC, instead emailing a statement from company President Michael Colglazier.

“We are asking city leaders to continue with a policy set two decades ago that has driven unprecedented job creation, growth, and prosperity, and enabled the city to invest in vital services that benefit every Anaheim resident,” Colglazier said in the statement.

The idea of an entertainment tax has been a politically charged issue in Anaheim. Under some tax proposals, visitors to Disneyland would be required to pay a $1 gate tax to get into the park.

Debate over such a tax has intensified since last November’s election, when voters passed a new governing structure that expands the council and requires council members to be elected by district, a system that advocates say would give greater representation to the city’s working-class Latino neighborhoods.

It’s no secret that some potential council candidates, like Los Amigos President Jose Moreno, have expressed support for an entertainment tax to fund city services for underserved neighborhoods.

Following the fall election, Councilwoman Kris Murray persuaded a majority of her council colleagues to back a proposal, dubbed the Anaheim Taxpayer Protection Act, that would require a two-thirds vote of City Council to put any tax measure before voters.

That proposal, which will be on the 2016 general election ballot, was timed to coincide with the implementation of district elections, leading many to speculate the move was payback to the resort, which spent hundreds of thousands of dollars promoting Murray and other council members’ election campaigns.

“What’s the rush here?” Moreno said. “We have to wonder, when they say Anaheim Taxpayer Protection Act, we’re not talking about Anaheim residents, we’re talking about Anaheim corporate interests, at the expense of Anaheim residents.”

  • Boat Nectar

    What leverage does Disney have to ask for 30 more years without taxing
    tickets at the gate if they already announced they are going to invest in $1B to expand anyway? The Anaheim
    City Council going along with this proposal are either in Disney’s
    pockets, or they’re just plain stupid and corrupt. Source:
    DisneyHub(dot)blogspot(dot)com.

  • Cynthia Ward

    Has anyone SEEN the 1996 agreement? I cannot find it. The agreements were approved by the Anaheim City Council on October 8, 1996, when Tom Daly was Mayor and Tom Tait had just been appointed to Council to fill a vacancy. NOBODY in the meeting minutes references this agreement, for or against, and it is not in the Resolutions approved that night or the Ordinances Amended that night. So where is this public document affecting public policy for decades? And when were taxpayers included in the discussion of this deal in 1996?

  • Pingback: Anaheim to Extend Deal Protecting Disney From Entertainment Taxes – VoiceofOCEntertainments Business News UK | Entertainments Business News UK()

  • Smeagel4T

    Ahhh.. because clearly Disney is so hard-up after having laid off 250 well paid American IT professionals and replaced them with green card foreigners at half the price. They didn’t even have to move the jobs to India. They brought the Indians here on green cards in order to destroy American jobs.

  • UnitedWe StandDividedWeFall

    If you want to stop this insanity which is ruining our country, check out ; http://endcitizensunited.org/

  • UnitedWe StandDividedWeFall

    The Performing Arts Center and Disneyland are the only decent things we have in Orange County. Don’t blame Disney for this problem. Its the Republican Judges on the Supreme Court’s who ruled in Citizen United v. Federal Election Commission in 2010, to uphold the rights of corporations to make political expenditures. It is ruining our democracy and almost “requiring” corporations to make large contributions. The politicians who take the money are just weak and allow fear to guide them.

    • Philmore

      I don’t blame ants, rats, pirahnas,etc. for “doing what they do” either, but I’m going to keep them out of MY refrigerator and bathtub, and DAMN WELL hold ACCOUNTABLE those who are PAID for their RESPONSIBILITY to do so. For now, the UN accountable Anaheim Majority know that they are, for now, shaded in the APATHY of Anaheim residents. I’m still skeptical that Districts will change that, but the sudden “Fire Sale” on Tax Giveaways shows the G-3 may not be.

  • RyanCantor

    At some point, you have to wonder– when will Anaheim citizens realize they’d simply be better off by buying Disney stock versus actually hosting the park?

    Not only would it generate a significantly better return, but it also comes traffic, pollution, and meddling free! It’s looking more and more like the people in the City of Anaheim function as an asset to fuel the resort rather than the other way around.

  • Cynthia Ward

    Well I wonder if this ties into the Special Meeting just called (without fanfare) and quietly posted to the Council agenda page, so they can appoint the new City Manager during Closed Session, in a meeting on June 30th in the CM’s office on the 7th floor. Is someone being rewarded for being a good soldier?

    Now back to the issue at hand. Protecting Disney at all costs, even from the usual costs of doing business in our community. Because after all Anaheim is in awesome condition and the neighborhoods have no needs, so let’s ignore the 96% of the city offering shelter and home to residents in favor of the 4% of the City we no longer even pretend is not pulling the strings.

    OK, under WHAT proposal would guests pay a gate tax? Nothing has ever been put forward for consideration. So that would be LIE NUMBER ONE from City Hall (not counting today as a full day yet.) Actually the last known proposal was in the ’90s, and was put forward by the Anaheim Police Association union leaders who looked at the LAST deal made with Disney recognized there would be no funds to cover their pensions, and wanted the funding for assurance their department would be funded. They got something out of it and went away, and the issue has NEVER been offered to voters, but polling at the time showed it would pass. In fact EVERY poll taken over the last few decades indicates that residents would pass a gate tax, because if taxing tourists on their hotel rooms is an economic engine collecting revenues from visitors without tapping the pockets of residents, then a gate tax is doubly so. So now Disney has to make absolutely certain that it never even gets to VOTERS.

    The statement from Jose Moreno was a set up, he was at a candidate’s forum hosted by the church where Murray and Ament are reported to be members, and the moderator asked about the possibility of closing funding gaps with something like a gate tax, to which Moreno responded he would be “open to” it. That is really the only reasonable answer in that situation, because you cannot say NO NEVER when you don’t know what financial exposure the future may hold. Or, you can do as Lucille Kring did and offer your word and then go back on it claiming, “I never put it in my campaign materials.” Yeah there is some integrity for you. So there is LIE NUMBER TWO for City Hall.

    There is no proposal anyone has seen and Jose Moreno is not the big bad boogie man pushing for the non-proposal nobody has seen, BUT, we know Disney does NOTHING without a poll, so if they don’t want to wait for Murray to cover their butts with the ballot measure in 2016 making it nearly impossible to get something like this on a ballot, they must know they will lose.

    So maybe it is time for a citizens initiative on this issue. Maybe it is also time to start thinking recall on those “leaders” who have clearly forgotten who they work for, and quit caring about consequences a long time ago. I don’t know if a gate tax is a good idea or not but I do know that letting Disney make that decision with their 3 bought and paid for enablers masquerading as leaders is NOT the way to figure it out. This is a decision for voters. Period.

    • Mike Tardif

      “The statement from Jose Moreno was a set up ..” How was that question a “set up”? Regardless of the venue/host connection it is a legitimate question.

      • Cynthia Ward

        The point is, NOBODY had mentioned a gate tax prior to that night. Not Moreno, not anyone. And the City’s own media advisory admits there is NO proposal put forth by anyone. So why is Disney freaking out over a boogie man that nobody outside of their own camp is talking about?

        • David Zenger

          Probably because they realized a little late that the Murray Tax Protection Act wasn’t an iron clad guarantee of no gate tax after 2016.

          Of course the City, if it were honestly run, would tell Disney politely that single entities don’t get special privileges in our wonderful economic system.

          Oh, wait…

          • Mike Tardif

            Actually, Disney would be singled out for an admissions/gate tax – there are no other admissions taxes in the City of Anaheim. And that would just be the beginning of the tax parade.

          • David Zenger

            What about events at the Honda Center, Grove, etc?

          • Mike Tardif

            What the heck .. tax them as well.

          • David Zenger

            The point is that Disney is not an exclusive location for this type of thing.

            And NOBODY is advocating a gate tax at all. Disney is just afraid that it is coming to the end of its free run tether. And they may be right.

            If taxes are voted on by the people then tax exemptions should be voted on by the people, too.

          • RyanCantor

            Here, here.

            Part time elected officials have no business overriding the explicit will of the people they represent.

            We don’t let Congress do it; We shouldn’t let anyone else.

          • Philmore

            How do you support “Disney being singled out” when there has been NO call by ANYONE for such a tax, and only Disney is seeking its OWN immunity ? Please explain.

        • Mike Tardif

          It had been talked about in blogs etc. – that’s where things like that leak out &/or begin. And questions like that rightly put candidates and electeds on the spot – feet to the fire.