What is a CDD fee and how is it different from HOA dues?
Reviewed by the OurHOA team · Updated July 2026
CDD, Mello-Roos, and metro district charges look like HOA dues but they are government levies. What they fund and why missing one is worse.
Two charges, two different animals
If you bought in a newer master-planned community, you may be paying two separate community charges that people constantly mix up. HOA dues go to a private nonprofit corporation your neighbors run, set by a board you elect, billed monthly or quarterly, and spent on landscaping, insurance, amenities, and reserves. A CDD assessment goes to a community development district, which in Florida is a special-purpose unit of local government created under Chapter 190 of the Florida Statutes, with its own board, its own budget, and the power to issue bonds. One is a neighborhood association. The other is a small government that happens to cover your subdivision.
Why the district exists at all
When a developer builds a community from raw land, somebody has to pay up front for the roads, water and sewer lines, stormwater ponds, and entry features before a single home closes. A district lets the developer finance that infrastructure with municipal bonds instead of rolling the full cost into the sticker price of each house, and the homeowners then repay the bonds over decades. That is the real trade: your purchase price is lower than it otherwise would be, and you inherit a long-term payment obligation attached to the land. Whether that is a good deal depends entirely on the size of the assessment and how many years are left on it.
The two halves of a district bill
A CDD assessment is usually two charges bundled into one line. The debt service portion repays the infrastructure bonds and typically runs on a fixed schedule for twenty to thirty years, and in many districts an owner can pay that portion off early in a lump sum. The operations and maintenance portion is set fresh every year by the district board to cover what the district actually maintains, and unlike the bond piece it never goes away. Both are non-ad valorem assessments, meaning they are not calculated from your home's assessed value the way regular property taxes are, so a modest house and an expensive one on similarly sized lots can owe close to the same amount.
Same idea, different name in every state
Florida calls them community development districts. In California, the Community Facilities Act of 1982 produced Mello-Roos districts, which levy a special tax that shows up as a direct assessment on the county property tax bill and is calculated by a district formula rather than as a percentage of assessed value. Colorado has metropolitan districts, units of local government with elected boards that collect through a mill levy on your property tax bill, file transparency notices with the state, and are subject to open meeting and public records rules that no private HOA has to follow. Texas has municipal utility districts that levy a tax rate to repay water, sewer, and drainage bonds. Different statutes, same basic machine.
Missing a district payment is worse than missing dues
This is the part that catches people. Because most district assessments are collected on the county property tax bill, delinquency follows the property tax collection process rather than the private collection process an HOA has to use. In Florida that means an unpaid amount can be sold as a tax certificate and, if it stays unredeemed, can end in a tax deed sale, with no lawsuit and no association attorney involved. An HOA has to send notices, record a lien, and generally go through a foreclosure process with real procedural steps. A taxing district is simply riding along with the county, and the county has been collecting delinquent taxes for a very long time.
What to check before you buy
Ask for the district assessment amount in writing, separate from HOA dues, and get both numbers before you commit. Find out how many years remain on the debt service portion and whether the prior owner already paid off the bond, because a paid-off parcel and an unpaid one sitting side by side can differ by more than a thousand dollars a year. Look at the district's own budget and website, which for a government entity is usually public in a way HOA records are not. And confirm your lender used the full combined figure when it qualified you, since online tax estimates sometimes miss district assessments entirely.
The half your board actually controls
If your community has both, remember that your board has no authority over the district assessment and the district has no say over your covenants. Owners who show up angry about a rising tax bill are often in the wrong room, and a board that can explain the difference clearly saves itself years of that. The dues side is where your board's decisions actually land, and that is the side worth running well: an accurate budget, a funded reserve, and a ledger every owner can see. OurHOA gives small self-managed communities the tools to keep that half transparent, which makes it much easier to point owners to the district when the question is not about dues at all. District rules, payoff options, and collection procedures vary by state and by the specific district, so read your own district's documents or talk to a local professional before you rely on any of this.
OurHOA is the friendly, affordable way self-managed communities keep dues, records, and reminders in one place. See how it works.
These guides are general education for HOA boards and residents, not legal, tax, or financial advice. Rules vary by state and by your community's governing documents - check with a professional for your situation.