CDD-The What and Why of it in Florida

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Real Estate

What Ray and I are told on a regular basis is purchasing a home in Florida is different from other areas of the country. One of the unique things is, well, this CDD thing. What is it? I mean I grew up Catholic and I attended CCD class every week. Then there are CD’s for music and CD’s that used to pay a decent interest rate. A CDD is nothing like any of those. So, what is a CDD?

CDD—Community Development District. It is not part of an HOA. It is separate and totally different. The creation of CDD’s was established in Florida’s Uniform Community Development District Act of 1980. CDD’s are governed by a Board and must adhere to specific regulations, ethics, and they are even audited. The CDD must comply with the Florida open government standard called the Sunshine Law. There are well over 600 CDD’s in Florida.  It was created as a way for developers to finance the construction of specific improvements without having to come up with the money upfront themselves. The theory is when you buy into a community that boasts of resort pools, state of the art fitness centers, pickle ball courts,  golf courses,  etc.;  those amenities are there and in place for you to enjoy even if your home is the first home completed. The developer, because of these bonds, has the funds to create the lifestyle for the community as the first homes are coming out of the ground.  The CDD is run by a board of supervisors which are elected by the developer and they issue bonds to pay for the infrastructure and amenities.  After six years the developer begins the process of turning the CDD over to the residents. The homeowners that buy into the community pay the bonds back generally over 20 to 30 years. The CDD is always added to the tax bill, but it is NOT a tax.  It simply is a way for developers to develop the community lifestyle envisioned from the start. Are there pros and cons? Absolutely. But, when you are spinning on the stationary bike in the fitness center while looking out at the resort pool and making plans with your neighbor for tonight’s Left-Right-Center game remember all of this is in place for you to enjoy because of the CDD fee and the CDD Board that oversees expenditures.

Want more info -- click on the links below….

Florida For Boomers

The Sunshine Law chapter 190

How Wikipedia explains it

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