Disney’s plans to build a hotel at Disneyland’s Downtown Disney have come to a screeching halt. According to Disney, they have stopped development of the luxury resort hotel due to a battle over tax breaks.
In 2016, the Anaheim City Council approved a $267-million tax break for Disney to build the hotel. Today, however, David Ontko chief counsel for Disneyland Resorts, stated:
“You have given us no other choice than to put construction of the hotel on indefinite hold as the resort reevaluates the economic viability of future hotel development in Anaheim,”
Anaheim Mayor Tom Tait had this to say about Disney halting plans due to the loss of the tax breaks:
“It’s a matter of law, and legally the city cannot pay the subsidy because it’s a fundamentally different project. If Disney wants to build a luxury hotel they should build it with their own money.”
Originally, Disney planned to build the luxury resort at the north end of the resort, but after the tax break was approved, they moved the site to Downtown Disney. This 1,000-foot shift in location has seemingly cost Disney the 70% break on Anaheim’s occupancy tax for the time being.
Fabela, the city attorney, says that the tax break was for the specific location, and the revised location does not qualify for the savings. Anaheim City Council would either need to amend the current tax break or issue a new one for Disney to receive the savings on the new location.
Due to changes in the makeup of Anaheim City Council, some of which are against the tax break, it is unlikely the Downtown Disney location would receive a revised tax break.
Disney does not need any further approval from the city council were they to move forward with the project.
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