Disney Wants Anaheim to Cease Tax Breaks

Living wage fight may be behind the company's sudden shift. 

Disneyland in Anaheim. (Photo by Harshlight)

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The Anaheim City Council this week voted to end an incentive deal with Disneyland Resort, the Los Angeles Times reports. The move — scrapping agreements for tax breaks in exchange for investments in Disney’s theme parks and an adjacent shopping district — was requested by Walt Disney Co.

Disneyland Resort President Josh D’Amaro sent a letter to Anaheim officials last week saying the deals have “created an adversarial climate where there should be cooperation and goodwill,” according to the Times. But the company may have ulterior motives.

From the paper:

By eliminating certain tax agreements, Disney may be ensuring that it isn’t affected by a Nov. 6 ballot measure that, if passed, would require the resort to pay all its workers a living wage.

The measure, which was added to the ballot after unions representing resort workers collected enough signatures, would require large hospitality businesses that accept a city tax subsidy to pay workers a minimum of $15 an hour, with a $1 hourly increase each Jan. 1 until 2022. Once the wage reaches $18 an hour, annual raises would be tied to the cost of living.

Roughly 60 Disneyland workers attended the meeting and called on the resort to pay them a living wage — whether or not the tax breaks stand.

“How much is enough for them to make before they share it with the people who make the magic?” Julieta Briceno, a housekeeper who has worked at the resort for 10 years said, according to the Times.

Disneyland representatives claim that the resort has secured a contract with four of its largest unions — representing about 9,700 workers — to raise hourly wages 20 percent immediately, with an additional 13 percent bump in January. But the resort has about 30,000 employees in total.

Like company towns in Silicon Valley, Anaheim does have an often-adversarial relationship with its largest employer. As Next City has covered, the city balked at Disneyland’s request for a $200 million tax subsidy in 2016 to build a massive new luxury hotel.

“Disney of all entities doesn’t need city funds to build this hotel,” Mayor Tom Tait said at the time. “There’s no reason why the city would ever do this, no legitimate reason.”

“[$200 million] is a massive amount of money given our entire general fund budget is $300 million,” he added. “Writing a check to Disney for $15 million a year for 20 years — coupled with tens of millions in other subsidies to hotel developers — is going to have a massive negative impact on our ability to deliver vital services.”

The city did end up approving a $267 million tax break, however, according to the Voice of O.C. But that agreement has also been complicated — perhaps even nullified — by a simple change of address for the planned resort.

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Rachel Dovey is an award-winning freelance writer and former USC Annenberg fellow living at the northern tip of California’s Bay Area. She writes about infrastructure, water and climate change and has been published by Bust, Wired, Paste, SF Weekly, the East Bay Express and the North Bay Bohemian

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Tags: taxestax increment financinganaheim

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