What Is A CDD Fee In Freeport?

Seeing a “CDD fee” on a Freeport listing and not sure what it means for your budget? You are not alone. Many Emerald Coast buyers come across CDDs when looking at newer or master‑planned neighborhoods and want clear answers before they make an offer. In this guide, you will learn what a CDD is, how fees are set and collected in Walton County, how they differ from HOA dues, and how to verify the exact amount for any home you are considering. Let’s dive in.

What a CDD is in Florida

A Community Development District, or CDD, is a special-purpose local government created under Chapter 190 of Florida law. Developers often use CDDs in large, planned communities to finance and maintain public infrastructure and amenities within the district boundaries. You will see CDDs fund things like roads, stormwater and drainage systems, water and sewer improvements, landscaping, parks, and clubhouses.

A CDD is governed by a Board of Supervisors. Early on, the developer typically appoints the board. Over time, residents vote for board members. Budgets, meetings, and records are public, which adds transparency to how money is spent and how assessments are set.

What a CDD fee covers

Most CDD assessments have two parts that show up as a single annual charge:

• Debt-service assessment: Repays the bonds that financed major infrastructure when the community was built. This piece often follows a fixed schedule.
• Operations and maintenance assessment (O&M): Covers yearly costs to operate and maintain district-owned assets like landscaping, parks, pools, stormwater systems, and reserves.

Together, these form the CDD fee you pay as a property owner in the district.

How fees are calculated

Each year, the CDD adopts a budget that sets how much revenue is needed for debt and for O&M. The total is then apportioned across properties within the district based on an assessment methodology. Some districts charge the same amount per residential lot. Others use tiers for different product types like single-family, townhome, or multi-family.

Your debt-service portion is usually defined in bond documents and can be traced to the engineer’s report and assessment resolutions. O&M can change from year to year if costs, insurance, or utility rates change or if more amenities come online.

How and when you pay in Walton County

In Walton County, CDD assessments commonly appear on your annual property tax bill as a non-ad valorem assessment. The county tax collector collects this amount along with your property taxes. In some districts, especially for O&M, the CDD may bill you directly instead of using the tax roll. Either way, the assessment is tied to the property rather than the owner.

Payment timing follows the tax bill cycle if collected through the county. If the district bills directly, you may see an annual or semi-annual invoice. Always confirm the billing method and schedule for the specific property you are buying.

CDD vs. HOA differences

It is important to understand how a CDD compares to a homeowners association because a property can have both, and both can affect your budget.

• Legal nature: A CDD is a public, special-purpose government created by statute. An HOA is a private association created by covenants.
• Authority to charge: A CDD can levy mandatory non-ad valorem assessments and often collects via the tax bill. An HOA collects dues and special assessments under its covenants and can enforce by lien.
• Use of funds: A CDD pays for public infrastructure and long-term capital, plus O&M for district assets. An HOA funds private common-area maintenance, amenity operations, and covenant enforcement.
• Governance: CDD meetings and records are public. HOA records and rules are governed by private documents, with varying disclosure requirements.

For budgeting, plan for both if your Freeport home is within a CDD and also part of an HOA.

Impact on your mortgage and budget

Lenders typically include recurring CDD assessments when calculating your housing payment and debt-to-income ratio. This can affect how much you qualify to borrow. Share the estimated annual assessment with your lender early, and ask whether it will be escrowed with your taxes or paid separately.

From a monthly budget standpoint, break out the annual CDD amount into a per-month figure and add it to your taxes, insurance, and HOA dues. This gives you a clearer picture of all-in costs before you write an offer.

Prepaying or transferring the assessment

Some bond issues allow you to prepay the remaining capital portion of the CDD assessment. Prepayment terms depend on the bond documents and district policies. If allowed, a lump-sum payoff can remove future debt-service charges, leaving only the O&M portion each year.

When you buy or sell, the CDD assessment usually stays with the property unless the seller prepays it or you agree to a different arrangement in the contract. Ask for clarity on whether any portion has been prepaid and what remains.

Resale factors in Freeport

CDD visibility can influence how buyers view affordability, especially when comparing similar homes. A long remaining bond term may keep assessments steady for many years. After bonds are retired, the debt-service portion can end, though O&M typically continues.

The availability of prepayment and the district’s long-term plan for O&M can also shape buyer demand and pricing. Reviewing public budgets and recent board discussions can help you anticipate future costs.

Find and verify a CDD fee

Use this simple Freeport-focused checklist to get the facts for any address you are considering:

• Ask the listing agent and seller for the current annual CDD amount and the split between debt service and O&M. Confirm if any portion has been prepaid.
• Review the property’s most recent Walton County tax bill and look for non-ad valorem CDD assessments. If you cannot find it, call the county tax collector.
• Check the Walton County property appraiser records and recorded plats to see if the parcel is inside a special district. County planning can also confirm district boundaries.
• Request key district documents: the adopted budget, assessment roll, meeting minutes, engineer’s report, and bond official statement. These show current assessments, obligations, and prepayment rules.
• Ask your title company or closing agent to identify any recorded special assessments and confirm how they will appear on your closing disclosure.
• Share the CDD information with your lender so they can factor it into qualification and escrow setup.
• Review recent CDD board minutes for upcoming projects or budget changes that could affect next year’s assessment.
• For complex bond structures or large balances, consider a Florida real estate attorney to interpret prepayment calculations and long-term obligations.

Pros and cons

Here is a quick view of what buyers often weigh with CDD communities in and around Freeport:

• Pros:

  • Funds roads, drainage, utilities, and amenities without immediate city or county taxes rising for the whole area.
  • Public governance, required audits, and open meetings provide transparency.
  • Can deliver amenities and infrastructure that support daily life and long-term value.

• Cons:

  • Mandatory assessments raise annual housing costs on top of taxes, insurance, and HOA dues.
  • Debt-service portions can be significant and may last for decades.
  • O&M can change over time with utility costs, insurance, and amenity upkeep.

Your next step

If you are eyeing a home in Freeport or elsewhere in Walton County, confirm the CDD details early so there are no surprises at underwriting or closing. A clear view of the assessment, the bond timeline, and O&M trends will help you compare homes with confidence and negotiate from a position of knowledge.

Have a property in mind? Get precise CDD figures, a clean comparison against HOA dues, and guidance on lender treatment and negotiation strategy. Connect with the local team at Coastal Heritage Realty to move forward with clarity.

FAQs

What is a CDD fee on a Freeport home purchase?

• A CDD fee is a mandatory assessment that funds infrastructure debt service and ongoing operations for a Community Development District established under Florida law.

How are CDD fees billed in Walton County?

• Most appear on your annual property tax bill as a non-ad valorem assessment, though some districts bill owners directly for part or all of the charge.

How is a CDD fee different from HOA dues in Freeport?

• A CDD is a public entity that funds infrastructure and O&M with mandatory assessments, while an HOA is a private association that funds community services and covenant enforcement.

Do CDD fees affect mortgage qualification for buyers?

• Yes. Lenders usually include recurring CDD assessments in your housing payment calculations, which can influence how much you qualify to borrow.

Can I prepay the CDD assessment on a Freeport property?

• Sometimes. Prepayment depends on the bond’s terms and district policies. Ask for the official statement and prepayment formula to confirm options.

What happens to a CDD fee when I sell my home?

• The assessment typically remains with the property unless it is prepaid. Buyers and sellers can negotiate prepayment or credits in the contract.