A new court ruling in favor of Walt Disney World could potentially rake in millions in property tax refunds from Orange County Public Schools.

Walt Disney World Property Tax Refund Decision

The decision in Disney’s favor was handed down on Monday, September 23 by Judge Thomas W. Turner after an eight-year-long legal battle over Disney’s claims that the Orange County Property Appraiser’s Office improperly calculated the value of Disney’s Yacht & Beach Club Resorts.

The property appraiser’s assessment of the resort for tax years 2015 and 2016 was “unconstitutional and invalid,” according to Judge Turner in his decision. “The appraiser substantially increased the amount of Disney’s tax bill by unlawfully including value attributable to Disney’s intangible property.” Here, the judge specifically meant Disney’s brand, managerial skills, and workforce.

A total refund amount has not been determined, but Orange County Tax Collector Scott Randolph said Disney could receive $2 million for property taxes paid on the resorts in 2015 and 2016. However, Randolph also said that Disney could get nearly $80 million if the ruling is applied to all of its Walt Disney World Resort hotels.

Techincally the ruling only applies to the Yacht and Beach Club Hotel and only for those two years, but the disagreement on which it’s based upon, the valuation determination, is the basis for all their litigation on all the hotels of Disney since 2015.

Scott Randolph, Orange County Tax Collector

Randolph also indicates that Orange County Public Schools put aside about $80 million in the event the lawsuit was decided in Disney’s favor, per his encouragement. The amount is, according to Randolph, the equivalent of paying a $6,000 retention bonus to every teacher in the district or building about three new elementary schools.

School officials did not respond to the Orlando Sentinel’s request for comment, nor did Disney or its lead counsel.

According to Ana C. Torres, general counsel for Orange County Property Appraiser Amy Mercado, an appeal to the decision is under consideration.

Disney originally filed this lawsuit in 2016, after the assessed value of Disney’s Yacht & Beach Club increased 118% from $154 million in 2014 to $336 million in 2015, “although there was no material renovation or expansion,” said the judge. Disney followed up by suing then-Property Appraiser Rick Singh, who “had lumped Disney among the ‘fat cats’ he was fighting to force them to pay their fair share,” per the Sentinel. Singh lost in 2020 to Mercado, who won a second term in August when her re-election challenger withdrew.

In a brief submitted by Mercado’s lawyers last month, they argue that Disney had “enjoyed many years of artificially low assessments” and insist that the increase in 2015 corrected that error.

Due to a state law preventing commercial property taxes from increasing more than 10% a year unless the assessing authority is a school district, only Orange County Public Schools received the full amount of the tax increase from the 2015 appraisal.

Source: Orlando Sentinel

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Brit Tuttle