How Long Do You Pay CDD Fees in Florida?

Community Development Districts (CDDs) are specialized governmental entities established to manage and finance infrastructure and services within planned communities. CDDs provide a mechanism for funding amenities and infrastructure, such as roads, utilities, and recreational areas, within planned communities. Homeowners within a CDD pay assessments that contribute to the costs of these community improvements and ongoing services.

Understanding CDD Fee Components

Community Development District fees generally consist of two distinct components: the bond assessment and the operations and maintenance (O&M) assessment. The bond assessment portion is specifically allocated to repay the long-term debt incurred by the CDD to finance the initial construction of community infrastructure and amenities. This infrastructure can include water management systems, roads, streetlights, and recreational facilities like clubhouses and pools. The bond assessment is a fixed amount that contributes to the principal and interest on these bonds.

Conversely, the operations and maintenance (O&M) assessment covers the ongoing costs associated with managing and preserving the CDD’s facilities and services. This includes expenses for landscaping, common area upkeep, pond maintenance, and administration. Unlike the bond assessment, the O&M assessment can fluctuate annually, as it is determined by the CDD’s Board of Supervisors based on the yearly budget and operational needs. Both the bond and O&M assessments are typically collected as non-ad valorem assessments on a property owner’s annual tax bill.

Factors Determining Payment Duration

The duration for which Community Development District fees are paid varies significantly depending on the specific component of the assessment. The bond assessment, which finances the initial infrastructure, is paid for a finite period tied to the maturity schedule of the bonds issued. These bonds are typically structured to be repaid over a period ranging from 20 to 30 years, though the exact term can differ for each district and bond series. Once the principal and interest on these bonds are fully paid, that portion of the CDD fee is eliminated.

In contrast, the operations and maintenance (O&M) assessment is an ongoing annual fee that continues for as long as the Community Development District exists and provides services to the community. This assessment covers ongoing upkeep and operational costs of the district’s facilities and amenities. While the debt service portion eventually concludes, the O&M assessment is perpetual and remains a responsibility for property owners within the district. Property owners often have the option to pay off their individual share of the bond assessment early, which can reduce their annual CDD payment, although the O&M portion will still apply.

Locating Specific CDD Fee Information

Property owners can ascertain the precise details and duration of their Community Development District fees through several accessible channels. The most common method involves reviewing the annual property tax bill, where CDD fees are itemized as non-ad valorem assessments. This bill typically separates the bond assessment from the operations and maintenance assessment, providing a clear breakdown of the amounts due for each component.

Additional information can be obtained directly from the official Community Development District websites, which often publish budget documents, assessment rolls, and contact information. These resources may detail the original bond maturity dates and the remaining years for bond assessments within the district. For property transactions, requesting an estoppel letter is a standard practice. This legal document, typically provided by the CDD or its management company, outlines any outstanding balances, future assessments, and the payoff amount for the bond portion of the CDD fee.