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Anaheim Votes to Take Disneyland's Billion-Dollar Deal

July 8, 2015, 10:28 AM · The Anaheim City Council last night (actually, early this morning) vote to give Disneyland what it wanted and to extend a city ban on Disneyland ticket taxes for another 30 years. In exchange, the Disneyland Resort committed to $1 billion in expansion at the resort, with the ability to add 15 years to the tax ban by spending an additional $500 million on the resort.

As I mentioned earlier, this is a victory for the status quo — Anaheim agreed to continue not charging a tax it is not currently charging in exchange for Disneyland making an investment it had already planned to make. Still, the 3-2 vote this morning imposes some timing restrictions on Disney. It must start work on this billion-dollar expansion by 2017 and complete it within seven years, or the deal is off and Anaheim can start imposing a ticket tax anytime it wants. So, at least now Disney can't continue dragging its feet on Star Wars Land.

Or maybe it can. It appears that the first element in the capital expansion at the resort might be another parking garage, to be built on land Disney owns east of the resort. Our Matthew Gottula maps it out for us:

Visitors would use a pathway to be built on the site of the now-Disney-owned Carousel Inn to move between the new parking structure and the resort. A parking garage by itself won't satisfy the billion-dollar spend requirement that Anaheim demands, but the parking project should allow Disney to meet the start deadline without having to rush new theme park attractions into development.

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Replies (18)

July 8, 2015 at 10:37 AM · While it would make sense to build the parking garage first due to current and future demand, it would seem ridiculous that Disney needs more time to develop a Star Wars attraction. Both the parking garage and Star Wars land can be done concurrently and I expect the garage to be finished first anyways. That $1 Billion is still a lot of money so I expect it to be divided 3 or 4 ways. Parking, Star Wars, Marvel, and Hotel resort.
July 8, 2015 at 10:44 AM · Disney has stated their $1 billion plans do not include a new hotel. The focus will be on resort infrastructure (including the new parking structure) and new attractions in the existing parks (no third gate planned any time soon).
July 8, 2015 at 11:01 AM · It'd be nice if the pedestrian walkway went over the street and "landed" on Disney property, which I'm sure the company has discussed. It'd also conveniently let those pedestrians bypass the sometimes-awkward protestors that like to use that corner.
July 8, 2015 at 11:13 AM · I'm all about adding more parking to the Resort. However, I think they could use another hotel! Since I'm a DVC member, I can tell you it's hard to get a DVC room at Grand Cali. If the mapped area is accurate, they could easily build one hotel in that space and still have room for the garage, a potential ramp from the interstate, and tram service to the park. Look at the size of some of the buildings already in place there! I'm curious, what's the acreage of Mickey & Friends?
July 8, 2015 at 11:11 AM · That is great, an insainly rich company that makes tons of money gets a freebee for investing money in their own money printing machine that they already planned to do in a state that is bankrupt. YEAH 1%!
July 8, 2015 at 12:04 PM · California bankrupt? lol no.
July 8, 2015 at 12:28 PM · To the anonymous post from 85.150.173.168:
Wow, that's rich! Let's blame the state of California being bankrupt on big bad Disney not paying taxes. Lol! Educate yourself. Local and state governments do this all the time for businesses that help improve the economy by providing jobs, entertainment/attractions that draw in people (and money) from other places and create additional tax revenue far and above the amount in taxes that might be paid by the companies that receive these incentives. It's political, sure, but it's also about weighing what's best for everybody. So, if you have a problem with it, you should really direct your anger at the Anaheim city council or California legislature.
July 8, 2015 at 12:42 PM · To add what Ron A. has stated, Disney still pays taxes as a corporate citizen of the State of California, and this "tax exempt" status is just to prevent the city from levying a tax on admission tickets. Any tax that the city would levy would likely just be added to the bottom line price that guests would pay, so ultimately Disney protected its guests, not their own bottom line. Businesses to this all the time - Zipcar, a short term rental car company, frequently negotiates with cities and localities for exemptions from rental car taxes and or free exclusive parking spaces in strategic locations in exchange for investment in road improvement and a guaranteed density of vehicle available in a certain area. This by no means is an unprecedented move.

Nuisance taxes like this are hung over the heads of residents and businesses all the time to more or less to coerce (i.e. blackmail) people to get what the government wants. In this case, the City threatened to impose the tax which forced Disney to solidify plans to further invest in the property. In the end it's just a game of chicken that doesn't solve anything.

July 8, 2015 at 1:40 PM · Sounds like a good thing, but I hope Disney doesn't invest the $1 billion and then not do anything for the next couple decades. I would have liked to see a deal requiring continued investment to sustain the tax break (ex: $1 billion initial investment and then minimum $500 million capital investment each decade). Hopefully Disney will realize that they have serious competition and that $1 billion will not sustain them for 30 years.

As for where its going, I'm guessing the first project will be the second parking structure, then most of the remainder will be split between Star Wars Land and Marvel Land. There may be some smaller projects as well (such as refurbishing existing attractions or possibly adding a stand-alone attraction *cough* Frozen *cough*), but for Disney to compete they need to bring in major attractions that will appeal to a wide audience base.

July 8, 2015 at 3:43 PM · Disney already voluntarily spend $1 Billion to fix up California Adventure without requesting a tax exemption. I'm sure this latest request is all about timing. Disney already knew they will invest the money, which came after the success of Carsland. Just tie the new investment with the ticket tax exemption. It won't take long after Star Wars and Mavel is built to realize more capital expenditures are needed. They have this money sitting around waiting to be spent.

The $500 million must be spent for a 15 year extension of the tax exemption. This is likely to occur in the third decade. I'm not worried that there will be no investment in the interim, but it is likely no new construction is necessary since they can wait 10+ years after the first $1 billion. So in actuality, the $1 billion is sustaining them 10 to 20 years upon completion in 2024 before they have to begin construction of the addition $500 million before the 30 years is up.

July 8, 2015 at 3:44 PM · All this sounds like a win-win for Disneyland visitors. No to a tax we, the visitors, would have ended up paying and commitment from Disney to spend money on the resort.

Its all good!

July 8, 2015 at 5:33 PM · That picture definitely helps. I always thought the Carousel Inn was too far north to connect to the rest of the Disney property on that side of the street, but I was obviously wrong. I'm still not sure if Carousel Inn will be turned into a walkway though. It would dump pedestrians into the middle of Harbor Blvd without a crosswalk. And the monorail is in the way if they want to build a pedestrian overpass.

I'm wondering if the Carousel Inn will be turned into a driveway to get into the new structure with shuttles exiting onto Disney Way.

July 8, 2015 at 6:51 PM · I expect they will detour cars to the back side a block before or via Katella Blvd so the cars won't be on Harbor Blvd. Cars backing up on Harbor will jam up traffic. Cars turning into the parking garage at Carousel Inn will be a hazard to the pedestrians on the sidewalk.
July 8, 2015 at 6:56 PM · Ya know, looking at that map, I wonder if we'll see a mostly underground parking garage, with a Downtown Disney/Disney Springs built on top. Or maybe a hotel?
July 8, 2015 at 7:55 PM · I think it was kinda stupid for the city of Anaheim to threaten Disney with this tax. First off, we all know that Disney's gonna find some way around the tax, so what's the point? Second, say that Disney doesn't comply at all and relocates the resort to another city or just abandons the resort entirely. Well congratulations, Anaheim, you just lost your only big tourist attraction!
July 9, 2015 at 10:42 AM · based on the location of the freeway off ramp I'll bet anything that the entrance to the new parking structure will be via Disney Way. It makes perfect sense, Mickey and Friends can get guests traveling south via I-5, and the new one can get them traveling North... Also I'll bet anything that all this is to prep get ready for the next HUGE undertaking at DLR which would turn the Toy Story lot into a 3rd park. Yes Bob Iger said it won't be anytime soon. But how long is he talking about? He didn't say never, just not soon, I'll bet that before this deal runs out there is a 3rd park in that location and that Disney will have acquired Garden Walk and turned it into a DTD East. And yes, I'm suggesting things that I think are a mix of within 5 years, and in the grand master plan for the next 25 years.
July 9, 2015 at 11:25 AM · Does the development of these parking areas mean the toy story lot can begin to transition away from parking and begin early developement for theme park space? I don't see how disney can make legitimate Star Wars or Marvel lands without that space.
July 9, 2015 at 1:12 PM · They really have to get cracking on new attractions soon anyway. How long do they intend to make us wait for new stuff? The pipeline can't remain empty forever, while Universal builds and builds and builds...

P.S.: Anaheim already overcharges on hotel fees, so they can afford to cut us some slack on ticket purchases.

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