ANAHEIM, Calif. _ A few hours after the gates swing open at Disneyland and Disney California Adventure, the cars are still pouring into the massive 10,241-space parking garage.
They zoom into the six-story concrete structure, carloads of costumed kids, foreign tourists and graying baby boomers sporting Mickey Mouse ears, "Frozen" dresses and "Star Wars" backpacks.
The cash pours in too: Each vehicle pays $20 to park at the Mickey & Friends facility, $35 for a preferred space close to the escalators and elevators.
Even if the parking garage fills just half its spaces, it would still generate more than $35 million in annual revenue and easily hundreds of millions of dollars over the life of the structure.
That money all goes to Walt Disney Co. The city of Anaheim, which owns the garage and spent $108.2 million to build it, charges the company just $1 a year for the lease.
More than 20 years after Anaheim agreed to pay for the parking facility as part of Disneyland Resort's expansion, it has become a symbol of the Los Angeles-area city's complicated and increasingly tense relationship with its biggest and most powerful corporate citizen.
Over the last two decades or so, as Disney's annual profit has soared, the company has secured subsidies, incentives, rebates and protections from future taxes in Anaheim that, in aggregate, would be worth more than $1 billion, according to public policy experts who have reviewed deals between the company and the city.
Disney has negotiated these pacts with a carrot-and-stick approach _ one that has often included the company's threat of directing its investment dollars elsewhere. The agreements have spurred development of billion-dollar projects, including the California Adventure theme park and the forthcoming Star Wars: Galaxy's Edge area at Disneyland.
The company, headquartered outside LA in Burbank, masterfully works the political system, sometimes deploying aggressive strategies that belie its carefully cultivated image. Support for various deals benefiting Disney has come from Anaheim City Council members who have received generous campaign contributions through a byzantine network of political action committees funded by the company.
But now, for the first time in Disneyland's 62-year history, the entertainment giant is facing serious opposition from Anaheim politicians, including Mayor Tom Tait, who feel that the recent guarantees in particular were too much. The city's finances are squeezed for a variety of reasons _ it has, for example, unfunded pension liabilities of $590 million. Despite the tens of millions of dollars in tax revenue and high-profile benefits that Disney brings to Anaheim, some of the city's working-class residents said they don't see enough of the upside.
In a letter to the Los Angeles Times, Disney challenged that view. "Disneyland Resort has played a pivotal role in Anaheim as a job creator and economic engine," the company said, noting that it is committed to investing more than $2 billion there in the next decade.
Faced with growing criticism inside City Hall, last year Disney stepped up its local political spending, contributing $1.22 million to 10 PACs that were involved in the November election, according to an analysis of campaign finance disclosures by The Times. The PACs, most of which also spent money on elections outside Anaheim, received funds from multiple sources, though Disney was often a significant donor.
Even with Disney's large PAC contributions _ which dwarfed the money raised by the candidates it opposed _ two politicians supported by the company lost to reform candidates, flipping the balance of power on the council. Now, Disney's ability to extract lucrative deals from the city is in question.
"Some of the big projects that they may be thinking about _ some of the money they want to siphon off from the city _ will probably get postponed," said City Councilman Jose F. Moreno, who defeated incumbent Jordan Brandman, a beneficiary of more than $250,000 spent by Disney-backed PACs. "It is about being pro-neighborhood, pro-city."
The election offered a measure of vindication for Tait, who for years has been the most prominent critic of the Disney pacts.
"A lot of these things aren't a natural, normal thing for any city to do," the mayor said. "It is way too much."
The biggest Disney deals since the 1990s include the following incentives:
_ Anaheim agreed in 1996 to issue $510 million in bonds to finance various infrastructure improvements, the expansion of the Anaheim Convention Center and the construction of the $108.2 million Mickey & Friends parking structure, which Disney needed for California Adventure and other projects. When the 40-year bonds, which include roughly $1.1 billion in interest, are paid off, Anaheim will transfer ownership of the garage to Disney. Meanwhile, the company pockets the parking revenue.
_ In 2015, Anaheim approved an agreement to shield Disney's theme parks from any potential entertainment tax for as many as 45 years. In return, Disney is building the Star Wars-themed area at Disneyland and will invest in another major project at its resort in the future. By a conservative estimate, an oft-discussed tax of $1 per ticket could have generated more than $1 billion for Anaheim.
_ Last year, the city granted Disney a tax rebate for a luxury hotel the company plans to build. The deal, which is estimated to be worth $267 million for Disney, would amount to the largest subsidy given to any hotel in the city.
"Anaheim residents should ask themselves if the return on investment was worthwhile," said Michael Thom, an assistant professor at USC and an expert on tax incentives. "If not, then it's time to start asking elected officials why they continue to help Disney instead of spending the same resources on other things."
Disney declined requests to interview company executives, including Chief Executive Robert Iger and Disneyland Resort President Michael Colglazier.
But in a statement, the company disputed The Times' estimates and analysis valuing Disney's Anaheim incentives at more than $1 billion, arguing that future benefits and protections to the company shouldn't be part of the calculation. Two experts said the estimate is reasonable and that the deals should be included in any calculation of Disney's financial benefit. "Of course they have value. If they didn't, why did Disney want them?" Thom said.
Disney also said that its investments far outweigh the value of the deals from Anaheim and that it is contributing more than its fair share "despite what people with their own political agenda are insinuating."
