Community Facilities Districts: Verrado and Phoenix Metro

What is a Community Facilities District?

A Community Facilities District (CFD) is a special-purpose, tax-levying public improvement district authorized under Arizona law. A developer typically petitions the city to create a CFD early in a community's development to finance public infrastructure, such as roads, water lines, sewer, and parks, before enough tax base exists to pay for it. The district levies taxes and issues bonds independently of the city, and it is a separate political subdivision, not a financial derivative.

The assessment is an ad valorem property tax levy billed by the county treasurer on the annual property tax bill. It is separate from HOA dues, which are set by the homeowners association for common areas and amenities. Both can apply to the same property, and they are different obligations.

How do CFDs work in Verrado and Phoenix Metro?

Verrado, the master-planned community in Buckeye, has CFD districts established by the City of Buckeye, including Verrado District 1 and a western overlay district. Parts of Phoenix Metro use CFDs as well. Each district has its own official records, bond schedules, and assessment structure, and the per-parcel assessment follows the district's bond amortization schedule over time.

There is no universal rule for when a CFD assessment expires, is paid off, or transfers. Bond schedules, balances, and payoff rules vary by district and are set out in the district's official statements and the retail buyer disclosure. Whether an assessment must be paid in full at sale or refinance depends on the specific district and the lender or title company.

What should you verify for a specific property?

• Whether the property is actually inside a CFD, using the city's CFD map and the county assessor's parcel search.
• The exact annual assessment and bond schedule for that parcel, from the CFD disclosure document and the title company.
• Where the CFD charge appears on the property tax statement, confirmed before closing.
• Whether the assessment is a lien that must be paid off at sale or refinance.
• That the CFD tax is separate from HOA dues and other community fees.

This article is not tax or legal advice. Confirm the specifics for any parcel with the city, the county treasurer, the title company, and your own advisers, because the governing documents for each district are the authority.