OC Register Uncovers Potential Reason Behind Murray’s Anti-Tax Proposal

An Anaheim councilwoman’s proposal that would make it harder to pass new taxes coincides with the ending of a prohibition on a possible tax on admission to Disneyland and other venues, according to reporting by the Orange County Register’s Art Marroquin.

The finding bolsters arguments from critics who say that Councilwoman Kris Murray’s measure — which would need to be passed by the voters in the 2016 general election — is really about preventing a future council from passing a gate tax that would be targeted at Disneyland and raise significant revenue for city coffers.

Murray’s proposal would increase the number of City Council votes it takes to place a tax measure on the ballot from a simple majority to two-thirds. The council will also be expanding by two seats that year, which means it will take votes from at least five council members to allow a tax measure on the ballot.

According to the Register article, the city signed a bonds deal with Disney worth over $500 million to finance infrastructure improvements that paved the way for the California Adventure theme park, Downtown Disney, a convention center expansion and the Grand Californian Hotel.

But as part of that deal, the city agreed not to impose an admissions tax, a prohibition that extends through June, 2016, the same year that voters are going to decide on Murray’s proposal.

Murray claims that the timing was a coincidence, and that her measure is only about protecting residents from new taxes, according to the Register.

As the newspaper points out, Disney spent hundreds of thousands of dollars the last election promoting Murray’s candidacy.

From the article:

As a condition to get the park built, the City Council in 1996 unanimously agreed to pay up to $546 million for a new parking garage on Disney property, repaved streets, landscaping and renovated utilities. The work was to be funded by $395 million from city bonds underwritten by Disney, along with federal, state and county transportation funds.

Another condition was that the city agreed not to levy an entertainment tax on tickets sold at either of the Disney theme parks through June 30, 2016. If a ticket tax was adopted for entertainment venues in the city, the contract said all the money collected at the theme parks would be reimbursed to Disney until the deal expires.

The entertainment tax ban originally was intended to last forever, said Mayor Tom Tait, who sat on the council in 1996. Tait said that he persuaded his colleagues and Disney to reduce the term to 20 years.

“It was a pragmatic decision because there was a big benefit to fixing up the resort area,” Tait said. “The overall good of the agreement was outweighed by the objectionable parts.”

Several cities across the state, including Inglewood, Pasadena and San Francisco, levy admission taxes.

The notion of charging admission taxes to Disneyland has been debated for decades.

A proposed 5 percent tax on Anaheim’s entertainment venues gained momentum in 1975, but the City Council changed course after facing heavy opposition from Disneyland and the Angels.

The idea came up again in 1991, when Anaheim officials suggested that revenue generated by an admissions tax could help pay for building Disney’s second theme park.

At the time, Disney officials threatened to kill the project if a tax was imposed.

Disney continues to oppose taxes based on ticket sales, said Disneyland spokeswoman Suzi Brown.

“One of the key reasons that Anaheim has been such a success story is due to its policies and initiatives that encourage investment in the city and allow businesses to grow,” Brown said. “It is important that those practices continue to ensure the ongoing vitality of a vibrant community fueled by a strong economy.”

Moreno, who lost a bid for the City Council in November, said he found it “suspicious” that Murray wants to make it more difficult to enact new taxes in Anaheim just as the agreement between the city and Disney is about to end.

“We really have to wonder where this idea is coming from and how she came up with it,” Moreno said.

Please contact Adam Elmahrek directly at aelmahrek@voiceofoc.org and follow him on Twitter: @adamelmahrek