When voters in Anaheim, Calif., go to the polls Nov. 6, they will decide whether large hospitality companies that receive a tax rebate from the city will be forced to pay their workers a "living wage."
What is unclear is whether the initiative, Measure L, will apply to the city's biggest employer of all, the Disneyland Resort — an uncertainty hinging on how to interpret a decades-old agreement to build a $108 million parking garage for the resort.
The leaders of the unions that represent the Walt Disney Co. workers — the same ones who collected about 20,000 signatures to put the initiative on the ballot — say the measure certainly applies to the popular Anaheim resort.
"They know it does apply to them but they are not going to say it," said Austin Lynch, organizing director for Unite Here, the union that represents hotel workers, food service employees and others in Orange County.
The city of Anaheim disagrees but has yet to issue a formal opinion, and officials with the Burbank media and entertainment company won't comment on the matter.
The measure asks that "hospitality industry employers located in the Anaheim or Disneyland Resort Specific Plan Zones that have tax rebate agreements with the city" be required to increase their minimum wage and raise it annually to reflect the cost of living.
Until recently, the resort had two tax rebate agreements with the city: A 2016 deal to reimburse the resort $267 million in hotel taxes if Disney agrees to build a luxury hotel in the resort; and a second agreement that ensures the city won't adopt any entertainment taxes for 30 years in exchange for the resort's promise to invest $1 billion in the resort.
At the request of the resort's president, who said the tax breaks were causing strife with the city and its residents, the Anaheim City Council voted unanimously last month to end both agreements.
Disney also put on hold its plans to build a luxury hotel in the Downtown Disney shopping district. Several businesses, including popular eateries, were closed to make way for the hotel construction. Food trucks have been deployed to fill the dinning gap.
The move by the council to kill the tax subsidy deals seemed to have guaranteed that Measure L wouldn't apply to the 30,000 workers at the Disneyland Resort.
But under a 1996 agreement to build the six-story parking garage, the city issued 40-year bonds and agreed to pay them off with taxes collected mostly from Disney but also from bed taxes from hotels throughout the city. Meanwhile, Disney collects the parking revenue from the garage — more than $35 million a year. Once the bond is paid off, the city has agreed to transfer ownership of the garage to the resort.
Richard McCracken, an attorney who helped draft the ballot initiative on behalf of the union, says the deal fits the ballot measure's definition of a tax rebate because taxes collected by the city are being used to benefit the resort.
"This bond financing was arranged to help Disney and all of the taxes used to pay for the bonds will be going to benefit Disney," said McCracken, a longtime labor lawyer who helped write several "living wage" ordinances throughout the state.
Other legal experts say the question is not so clear cut, suggesting that the dispute may ultimately be decided in court.