Are you seeing a “CDD” line pop up when you research homes in Westlake and wondering if it’s an extra tax? You’re not alone. Many buyers love new-construction neighborhoods here, but pause when they hear about Community Development District fees. You deserve a clear, simple explanation. In this guide, you’ll learn what a CDD is, how the fees show up on Palm Beach County tax bills, what they fund, how to budget for them, and what to verify before you buy. Let’s dive in.
What a CDD is in Florida
A Community Development District, or CDD, is a special-purpose local government created under Florida Statutes, Chapter 190. It helps plan, finance, build, and maintain community infrastructure inside a defined area.
Developers use CDDs in large master-planned neighborhoods so they can fund roads, utilities, stormwater systems, and amenities through bonds instead of paying all costs upfront. Those bonds are then repaid over time by property owners through annual assessments.
CDDs are governed by a board of supervisors. Early on, the developer often appoints board members. As the community builds out, seats transition to resident-elected supervisors as required by law.
How CDD fees show on your tax bill
In Palm Beach County, CDD assessments usually appear as separate non-ad valorem line items on your annual county property tax bill. They are not part of the county millage rate. Look for entries labeled as special assessments or with the CDD name.
You will often see two pieces:
- Debt service assessments to repay the bonds that funded infrastructure.
- Operation and maintenance, or O&M, assessments to run and maintain the district each year.
Some districts place both on the county tax bill. Others may bill O&M separately or collect it through the HOA. Practices vary by neighborhood, so confirm how your specific Westlake lot is billed.
Assessments can also be phased. Lots in different phases can carry different amounts, especially while a community is still under construction. Debt service per lot can change if more bonds are issued or if the base of assessed lots changes.
What CDDs fund in Westlake communities
In master-planned areas like Westlake, CDD bond proceeds commonly fund:
- Primary roads and entry features
- Stormwater systems such as ponds and drainage
- Water and sewer mains or lift stations
- Streetscape and landscaping in common corridors
- Community amenities like clubhouses, pools, fitness areas, parks, sidewalks, and trails
- Streetlights, signage, and some traffic signals
O&M assessments typically cover:
- Ongoing landscaping, pond care, and amenity upkeep
- Security and staffing at facilities
- Utilities and insurance for common infrastructure
- Administrative costs such as engineering, legal, accounting, and management
Importantly, infrastructure funded by a CDD is owned and maintained by the district as a local government entity. That can help ensure funding for long-term maintenance, but it also means a continuing assessment obligation for each property.
How to budget the CDD
CDD assessments are part of your annual ownership costs, along with your mortgage, property taxes, homeowners insurance, HOA dues, and utilities. Because the debt portion is a legal assessment secured by the property, nonpayment can result in a lien and potential foreclosure.
Here’s how to think about it in your monthly budget:
- Example A: If the annual CDD assessment is $3,600, divide by 12 for a $300 per month impact.
- Example B: If debt service is $2,400 per year and O&M is $1,200 per year, the combined $3,600 still equals $300 per month. One piece might be on the tax bill and the other billed separately.
Lenders typically include recurring assessments like CDD and HOA dues in your monthly debt-to-income calculation. Ask your lender how they handle the district’s O&M and debt for underwriting, since loan programs can differ.
CDD vs HOA vs property taxes
It helps to separate these three items:
- Property taxes are ad valorem taxes based on value. They fund county and municipal services.
- A CDD is a public special district. It finances and maintains certain community infrastructure and levies non-ad valorem assessments.
- An HOA is a private association that enforces community rules and collects dues for services within the covenants. Some services can overlap with the CDD.
When comparing homes, look at total monthly cost, not just whether a CDD exists. For example, a CDD neighborhood might have a $250 monthly equivalent CDD and a $50 HOA, while a similar non-CDD neighborhood has no CDD but a $300 HOA. Your total monthly cost is similar, but the legal structure is different. A CDD assessment is a statutory lien collected like a tax, which carries different enforcement than HOA dues.
Due diligence checklist for Westlake buyers
Use this simple checklist before you write an offer or during your inspection period:
Documents to request:
- The most recent Palm Beach County property tax bill for the lot to see CDD line items.
- The CDD budget and recent meeting minutes to review O&M plans and any proposed changes.
- The CDD bond Official Statement to understand the bond term, outstanding principal, and how assessments are calculated.
- A payoff or outstanding assessment statement for the lot to check for any unpaid or special assessments.
- HOA governing documents and budget to see what the HOA covers and whether it collects any portion of O&M.
Clarifying questions to ask:
- Which CDD district or districts serve this lot?
- What are the current annual debt service and O&M assessments for this property?
- Are there any special one-time assessments approved or proposed?
- Are assessments fixed or likely to change as bonds are issued or as the budget changes?
- Is O&M collected on the county tax bill or billed separately by the district or HOA?
- What is the remaining term on the CDD bonds for this phase?
Who to contact:
- Palm Beach County Property Appraiser and Tax Collector for how assessments appear and are collected.
- The Westlake CDD office or district management for budgets, assessments, and bond details.
- The developer or builder for community phasing and any credits or prepayment options.
- Your title company or closing attorney for confirmation of liens and payoff obligations.
Risks and common misconceptions
- Legal lien risk: CDD debt assessments are secured by the property and can lead to foreclosure if unpaid.
- Bond timelines: CDD bonds often run 20 to 30 years or more. Know how long the debt portion will last for your lot.
- Prepayment limits: Some districts allow individual prepayment of the capital portion, while others do not or require a specific process. Never assume you can pay it off without checking the bond documents.
- O&M changes: O&M assessments are set annually and can rise due to repairs, insurance costs, or budget needs. Debt service is usually fixed unless refinanced or new bonds are issued.
- Market impact: Buyers and appraisers consider CDDs in affordability and comps. Strong amenities can offset the fee in buyer perception, but the effect varies by community.
Your next step
If Westlake is on your short list, you can move forward with confidence once you understand the CDD. Start by pulling the latest tax bill, confirming whether O&M is on the tax roll or billed separately, and asking for the CDD budget and bond term for your specific lot. Then compare total monthly ownership costs across the communities you like.
If you want a local, plain-English walkthrough, reach out to Sommar Clark. Our boutique team helps you gather the right documents, understand the numbers, and compare Westlake homes with and without CDDs so you can choose the right fit.
FAQs
What is a CDD fee in Westlake, FL?
- It is a non-ad valorem assessment from a public district that funds and maintains community infrastructure and amenities in the area served by the district.
Do Westlake CDD fees show on Palm Beach County tax bills?
- Yes, most appear as separate CDD line items on the annual tax bill, though some O&M charges may be billed directly by the district or HOA.
How long do I pay a Westlake CDD fee?
- You pay the debt service portion until the bonds are repaid, often decades, and O&M assessments continue annually as long as the district provides services.
Can I prepay the capital portion of my CDD?
- Sometimes, but it depends on the bond documents and district rules. Always confirm with the district office before assuming prepayment is allowed.
How do CDD fees affect mortgage approval?
- Lenders typically include CDD and HOA amounts in your monthly debt-to-income ratio, which can affect how much you qualify to borrow.
How is a CDD different from an HOA in Westlake?
- A CDD is a public special district that funds infrastructure and maintenance, while an HOA is a private association that enforces community rules and manages services under its covenants.
