Looking at homes in Orlando and seeing a “CDD fee” line you don’t recognize? You are not alone. Many of the area’s newer, master-planned communities use Community Development Districts, and the fees can shape your monthly budget and loan approval. In this guide, you’ll learn what a CDD is, what the fees cover, how long they last, how they differ from HOA dues, and where you’ll see them during a purchase. Let’s dive in.
What is a CDD in Florida?
A Community Development District, or CDD, is a special-purpose unit of local government created under Florida Statutes, Chapter 190. It exists to plan, finance, build, operate, and maintain infrastructure and certain amenities within a defined area. Think roads, water and sewer, stormwater systems, parks, trails, and community centers.
A CDD is a governmental entity with powers to issue bonds, levy assessments, hold public meetings, and keep public records. A board of supervisors governs the district. Early on, the developer typically controls the board. As the community grows, residents usually elect board members.
What CDD fees fund
CDD assessments usually fund two buckets:
- Construction costs for community infrastructure and amenities, often through bonds.
- Ongoing operations and maintenance for district-owned facilities and common areas.
In Orlando’s master-planned neighborhoods, this can mean landscaped entries, recreation centers, pools, parks, stormwater ponds, and internal roads. The exact list depends on the adopted district plan and budget.
Types of CDD charges you may see
One-time capital or transfer assessment
Some districts charge a one-time fee at closing to recover a share of capital costs. It may show up as a “capital assessment,” “transfer fee,” or “recapture” on your settlement statement.
Annual assessment
Most districts bill an annual assessment that can include two parts:
- Debt service for bonds used to build infrastructure.
- Operations and maintenance for ongoing upkeep.
This may be billed as one combined amount or split into separate lines, depending on the district.
Special assessments
Districts can levy additional, non-routine assessments for unexpected needs or new projects. These are less common and must follow statutory procedures.
How long CDD fees last
The debt service portion lasts until the bonds are paid off. That is often 15 to 30 years, sometimes longer, based on the bond terms adopted by the district. It does not last forever.
The operations and maintenance portion continues as long as the district operates facilities. Even after bonds are retired, you can still expect an O&M assessment to fund upkeep of parks, ponds, and other assets.
CDD vs HOA: what’s the difference?
While they often exist in the same community, a CDD and an HOA are not the same.
- CDD is a governmental entity that levies non-ad valorem assessments under state law. It funds and maintains district-owned infrastructure and amenities.
- HOA is a private association that enforces community rules, maintains private common areas, and manages neighborhood standards. Dues are contractual under community covenants.
- Both can place liens for non-payment, but they do so under different statutes and procedures.
In many Orlando communities, you will pay both a CDD assessment and HOA dues. Budget for each separately.
Where you will see CDD fees in Orlando
Listings and marketing
Local listings commonly include fields for “CDD Fee,” “Annual CDD,” or “Transfer CDD.” The amount may be annual or one-time, so confirm the type of fee and the billing schedule. Treat listing figures as a starting point, not a final number.
Disclosures and title work
Seller disclosures should indicate if a property lies within a CDD. Title searches and public records will show the existence of the district, recorded liens, and bond documents. Ask for the district’s current assessment schedule in writing.
Closing and your mortgage
If a one-time capital assessment is due at closing, it should appear on your Closing Disclosure. Annual CDD assessments are typically prorated between buyer and seller. Lenders consider recurring assessments like CDD and HOA when calculating your qualifying ratios, so the annual amount can affect how much you can borrow.
How to verify and budget your CDD
Follow these steps before you write an offer and again before closing:
- Ask for documents
- Request the current year assessment schedule, any capital or transfer assessment details, and contact info for the district manager.
- Check Orange County records
- Review the Orange County Property Appraiser or Tax Collector to see if the assessment appears on the tax bill as a non-ad valorem item.
- Search the Orange County Clerk of Courts for recorded bond and assessment documents.
- Contact the district manager
- Request a written statement showing the current assessment amounts, how they are billed, and whether a one-time charge applies at your closing.
- Confirm with title and lender
- Ask your title company to verify any liens, prorations, and payoff or estoppel letters needed for closing.
- Provide your lender with the annual CDD amount and billing method so they can underwrite your loan accurately.
- Build your budget
- Identify whether you face a one-time charge, an annual recurring charge, or both.
- Annual cost equals the debt service portion plus the operations and maintenance portion. If billed annually, divide by 12 for a monthly estimate. For example, if the annual CDD is $2,400, plan for about $200 per month on top of your mortgage, taxes, and any HOA dues. Use the district’s current adopted budget or assessment roll for real numbers.
For tax or legal questions about deductibility or lien enforcement, consult a qualified tax professional or a local real estate attorney.
Red flags to watch
- A large one-time capital assessment at closing that was not in the listing.
- Annual assessments that are unusually high compared to similar communities. Ask what they fund and whether bonds or O&M costs are driving the number.
- Notices of pending special assessments or significant jumps in the O&M budget.
- Complicated payoff structures or unclear lien statuses. Make sure the title company addresses these before you close.
Who pays what at closing?
Responsibility depends on your purchase contract and local custom. Typically, annual assessments are prorated between buyer and seller. A one-time capital or transfer assessment may be paid by either party, subject to district rules and negotiation. Clarify this before your contract is signed.
Work with a local guide
Understanding CDDs helps you compare Orlando communities with confidence. With clear numbers, you can see how a district’s amenities and infrastructure align with your budget and long-term plans.
If you want help confirming the exact CDD amount, reviewing documents, and coordinating with your title company and lender, connect with Ken Burningham for local guidance across Orlando and Orange County. We will help you compare communities, estimate total monthly costs, and navigate your purchase with clarity.
FAQs
What is a CDD fee in an Orlando home purchase?
- A CDD fee is a non-ad valorem assessment from a Florida special-purpose local government that funds infrastructure and amenities within a district.
How are CDD fees different from HOA dues in Orlando communities?
- CDD assessments are governmental and tied to district budgets and bonds, while HOA dues are private, contractual payments to an association for rules enforcement and private common-area upkeep.
How long do CDD assessments last in Orange County, FL?
- The debt portion lasts until district bonds are repaid, often 15 to 30 years, while operations and maintenance assessments continue as long as the district operates facilities.
Where do CDD charges appear at closing in Florida?
- One-time capital or transfer assessments may appear on your Closing Disclosure, and annual assessments are usually prorated between buyer and seller according to the contract.
Are CDD assessments collected on my Orange County tax bill?
- Many districts place assessments on the county property tax bill as a non-ad valorem item, but some bill owners directly, so verify the method for your specific community.
