What is a CDD?

A CDD or Community Development District is a governmental unit created to serve the long-term specific needs of its community. A CDD’s main powers are to plan, finance, construct, operate, and maintain community infrastructure and services specifically for the benefit of its residents. It is an independent, special taxing district authorized by Chapter 190 of the Florida Statutes.  A CDD can be created at any time during the initial construction of a developer-owned community or for an already built and sold-out community.

What are the benefits of creating a CDD?

There are numerous benefits to forming a CDD for your community. Some examples include: A District pays no sales tax on its purchases; it enjoys sovereign immunity in the event of a lawsuit and complete protection of all District funds in the event of a loss; A CDD can issue bonds for capital projects. In short, a CDD can be a more agile way to fund the development and provide for customized and responsive maintenance of a community.

How long does a CDD exist once formed?

A CDD will last in perpetuity as its Board is charged with the ongoing responsibility for maintenance of the District’s assets: roads, lakes, stormwater management systems, and other infrastructure typically provided by a public entity. Generally, an asset that is owned by a CDD cannot be transferred to any private entity, only to another public entity.

What is the difference between HOAs and CDDs?

A Homeowners’ Association (HOA) is a private administrative entity responsible for managing private property and regulates restrictions on residential properties. A CDD is a public entity, like a small city, and is responsible for needed public facilities. These can include sewer, water, irrigation, roads, stormwater management, parks, and almost any typical municipal service including fire and security.

How are residents affected by living in a CDD?

The District levies an assessment against property each year. An assessment often contains two portions: one is the cost to administer and maintain the District, and another is a debt repayment portion, if there is any debt. The assessment will appear as a single Non-Ad Valorem assessment on a resident’s property tax bill each year. The debt service part goes toward paying off any CDD-issued bonds and the administration and maintenance portion pays for management services and any necessary on-going maintenance.

Who governs a CDD?

A CCD is governed by a five-person Board of Supervisors. Supervisors in developer-owned communities are elected by landowners, but in established and sold-out communities they are elected by qualified electors of the District. A qualified elector is a registered voter who is at least eighteen years of age, a resident of the District and of the state, and a citizen of the United States. Supervisors are elected in the general election with staggered 4-year terms.  Supervisors can also be appointed by the Board in the case of vacancies.

Who manages a CDD?

The Board of Supervisors hires and appoints a professional governmental executive called a District Manager who manages the affairs of the District in accordance with the Florida Statutes governing the administration of Special Districts.