A CDD fee is a Community Development District fee imposed by the developer of a neighborhood or subdivision to finance the cost of amenities in a neighborhood. These amenities and community improvements would not be provided without funding from CDD fees. Rather than increase the home’s selling price to cover the common amenities, the developer borrows money from the county, so the CDD fee that is paid by the homeowner is basically a repayment of a loan the developer received from the county.
CDD fees vary by development and are based on the amount of the loan taken from the county divided by the number of homes responsible for paying back the loan.
CDD fees are typically paid over a 30-year term. If you are moving into a development that is 10 years old, you can expect to pay a CDD fee for 20 years, until the loan is paid off.
The county adds the fee to your property tax bill each year as repayment. These fees are most often found in communities built after 2003. Payments for CDD fees ARE tax deductible, like your property taxes.
The CDD is not a property tax nor should it be confused with Homeowners Association Fees. CDD fees are paid in addition to property tax and may be bundled into the annual tax statement.