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Credit: Inside the MagicFor a while now, Florida Gov. Ron DeSantis and Walt Disney Co. have been playing nice with each other. After years of fighting over the Reedy Creek Improvement District, they put that all behind them. They decided to work together to make a massive investment in the Walt Disney World Resort in Central Florida.
Walt Disney Co. has agreed to spend more than $17 billion in Florida over the next 15 years, including hotels, restaurants, park expansions, and a possible fifth gate.
But despite the seeming agreement between DeSantis and Disney, a new issue has popped up that has the potential of costing Disney millions in increased costs as it sets out to begin building.
Yesterday, Governor DeSantis signed Senate Bill 674, which requires all steel and iron used in public projects to be made in the United States. That bill would have little relevance to Disney if not for what happened during their feud with DeSantis.
When Gov. Ron DeSantis stripped Disney World of the Reedy Creek Improvement District and passed legislation to replace it with the Central Florida Tourism Oversight District, the new district was made public. Under this new law, Disney must use steel and iron produced in the United States for its upcoming building projects.
Related: The Feud May Be Over, But the Cronyism Remains at DeSantis’ Disney Board
Steel produced in the United States can cost twice as much as steel made in China. As a business, Disney would attempt to get the cheapest products to build its new hotels and restaurants, but this new Florida law won’t allow them to do that.
In 2018, then-President Donald Trump placed a 25 percent tariff on steel produced outside of America. Since then, United States steel production has fallen below pre-tariff levels, causing steel production in America to slow.
Despite the new law signed by Ron DeSantis, Disney could use a few exceptions to keep costs down. Those are:
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The iron or steel products that are required for the project aren’t produced in the U.S. in sufficient qualities, aren’t reasonably available, or aren’t of satisfactory quality.
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The use of these products will increase the total cost of the project by more than 20%.
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Compliance with this requirement is inconsistent with the public interest.
This new effort will not affect the cost of materials for Universal Orlando Resort’s Epic Universe, which is nearing completion. However, it will dramatically affect any future construction project at Disney World, possibly raising the cost up to 20 percent.
Related: Without Fanfare, DeSantis Signs Two Bills That Allow Disney to Hire Kids for Dangerous Jobs
The new law takes effect on July 1, the start of the fiscal year, so there is not even enough time to purchase materials in advance. So, despite past efforts proving that these types of steel tariffs don’t work, Ron DeSantis has signed it into law, and now the Florida residents will have to pay for U.S. steel out of their taxes.
Do you think these types of steel tariffs will affect the steel industry in America?