What is the purpose of the Poinciana CDD?
The District was created to finance, manage the acquisition and construction, operate, and maintain of a portion of the infrastructure necessary for community development.
The Ordinance establishing the District authorizes the District to issue bonds for the purpose of financing, funding, planning, establishing, acquiring, constructing or reconstructing, enlarging or extending, equipping, operating, and maintaining water management, water supply, sewer and wastewater management, bridges or culverts, roadways, street lights and other basic infrastructure projects within or without the boundaries of the District as provided in the establishment Ordinance.
Do I pay higher taxes because I live in Poinciana CDD?
Yes, in a sense. In addition to service charges and taxes collected by the County, City, School Board, and other agencies, notwithstanding the existence of the District, landowners will also pay non-ad valorem assessments related to capital costs and operation and maintenance costs of District facilities and services.
While these assessments are not taxes, the District assessments will appear on your property tax bill which you receive annually from the Polk County Tax Collector. The reason for the additional District assessments is because the County does not provide the higher level of service that is necessary to maintain the community in its current condition, and this additional higher level of service results in higher property values and a higher-quality community than the run-of-the-mill subdivisions found elsewhere in the area.
What is the difference between a non-ad valorem assessment and an ad valorem assessment?
An ad valorem assessment is based on value, whereas a non-ad valorem assessment is not.
Your annual real estate taxes are ad valorem, meaning they are based on the value of the property and infrastructure, while CDD assessments are non-ad valorem. They are based on the benefit each parcel receives from District facilities, infrastructure, and services.
Why do I pay assessments and how are they determined?
All landowners will also pay non-ad valorem assessments related to capital costs and operation and maintenance costs of District facilities and services. Bonds were issued to fund these capital costs, and the bonds were secured by pledged revenues which are collected on behalf of the District in the form of non-ad valorem assessments by the properties within the District that benefit from the capital improvements.
The annual assessment is comprised of two components: debt service and maintenance.
The debt service component is the fixed amount required to amortize the debt for the infrastructure and facilities acquired or constructed by the District. The annual debt assessment collected for each property has been determined based upon use of each parcel. The District has levied a debt assessment against your property that is based on benefit and your pro rata share of the cost of the public infrastructure and facilities financed by the District.
The maintenance component is an annual assessment for operations and maintenance of District infrastructure and facilities. Each year, the Board of Supervisors holds a public hearing to set the budget and the level of operations and maintenance assessments. Included in the operations and maintenance assessment is your pro rata share of the annual costs to administer the District.
While these assessments are not taxes, they will appear on your property tax bill that you receive in November of each year. If you have a mortgage on your property and your taxes are escrowed, your assessments may be included in your monthly mortgage payment. In such case, your tax bill will be sent directly to your mortgage company and be paid from your escrow account.
What can I expect to pay annually for my assessments?
The Poinciana CDD has issued one bond series, Series 2000, for the benefit of public infrastructure and facilities for all properties within the District. The bonds were financed over a 30-year period, subject at any time to refinancing or refunding at the direction of the Board of Supervisors. Such a refunding did occur in 2012 with the Series 2012 Refunding Bonds to paydown the remaining bond indebtedness for the Series 2000A bonds. These refunding bonds will be paid back over a 19-year period, ending at the same time as the original Series 2000 bond term, which is May 2031.
These assessments are fixed over the life of the bonds and are included on the annual real estate tax bills. Any home owner has the option of paying down this debt assessment early, either in part or in whole, which will either reduce or eliminate the annual debt assessment levied on the property. For information on paying down your debt assessment, please contact the Assessment Department at 954-603-0034.
For those home owners choosing not to paydown the debt assessment early, you will pay this assessment only for the period of time that you own your home, or until 2031, whichever is sooner. If you sell your home before the District bonds are paid off, the next owner becomes responsible for paying their share of the cost of the infrastructure and facilities.
The operations and maintenance assessment may vary based upon the general fund budget adopted each year after an advertised, public hearing. The budget for the current fiscal year shows the maintenance assessments by product type. Click here to review the current budget.
The debt component added to the operations and maintenance component result in the total non-ad valorem assessments included on your annual real estate tax bill.
What is the difference between the HOA and the CDD?
The CDD constructs, operates and maintains public infrastructure such as the common area landscaping and the ponds, while the HOA primarily deals with covenant enforcement and violations and other private-property issues.
Each organization has a different governing Board and a different organizational charter. Each entity will also separately award contracts and hire consultants and employees for its own particular needs.