Virginia Governor Proposes Compromise on Disney Park

Gov. George Allen unveiled a compromise incentive package for a Walt Disney Co. theme park Wednesday that would require the company to write a check to the state treasury if the project does not produce as much tax revenue as promised.

Hoping to salvage the centerpiece proposal of his young administration, Allen presented the plan at a private meeting with key lawmakers who had balked at his original $163.2-million offer.

The compromise package could help the Republican governor break a legislative logjam that has stalled his subsidy for the northern Virginia park. It also is the first time that either Allen or Disney has retreated from their joint all-or-nothing bargaining stance. Time is running out for both as the General Assembly heads toward adjournment Saturday. “It’s a breakthrough,” Allen said of the new proposal, which he worked out with company executives during the last several weeks. “It’s good for the taxpayers of Virginia.”

The governor acknowledged that his initial version could not pass and that lawmakers had raised credible questions about the state’s risk in subsidizing a private corporation.

“The whole investment was in jeopardy,” he told reporters. “It then became imperative that we address the legitimate concerns of the House and Senate . . . while also not running the Disney corporation away from this investment in the state.”

But even in yielding somewhat, Allen and Disney drew a new line in the sand, maintaining that the Legislature would still have to fund the full $163 million.