BRADENTON, Fla. — Stressed community development districts in Florida this month have told bondholders that they continue to rely on reserves to make debt payments. Some have filed notices of default and analysts expect their number to increase.
The state currently has 571 active CDDs, according to state records. Since the early 1980s, the districts issued more than $11 billion of debt. Most are structured with payments due the first of May and November, and using reserves is not considered a “default” in their bond covenants.