Port, Chelan County Near Deal on Malaga Tax Increment District

The Chelan Douglas Regional Port Authority and Chelan County commissioners are closing in on an interlocal agreement for the Malaga Tax Increment Financing District.

What the Malaga TIF Agreement Would Do

READ MORE: Chelan Port Approves TIF

The Port and County have been at odds for months, but are now nearing terms they say would maximize resources while minimizing taxpayer and taxing district burdens impacted by the TIF.

The agreement would allow the county to keep revenue from new construction over the course of the 25-year TIF. The interlocal agreement would remain in effect until: the port certifies the tax increment area has been terminated after public improvements are paid for, 25 years after the first tax revenue is collected, if both parties agree to end it, or if one party materially breaches the contract.

How Revenue Would Be Distributed

The agreement proposes that the Port dismiss its pending litigation against the County. At the same time, the County must rescind resolutions placing a moratorium on tax increment areas, withdraw specific public records requests, and agree not to file new challenges to the TIF district while the agreement is in effect.

"It's just really exciting," said County Commissioner Brad Hawkins. "We can get to the point where we get through this, sign this agreement, start the healing process, and continue what has been, traditionally, a very positive working relationship with the Port, and that's something we want to have for the next 25 years and beyond."

Timeline for the Malaga TIF District

The TIF District would take effect June 1, 2026, with the first year of tax revenue collection for the port occurring in 2027. The district covers over 3,200 acres in Malaga. The County would distribute revenue from the TIF district to the port and other taxing districts.

The Port and the County could finalize the deal as early as this week, but Hawkins did say the agreement may be signed next week.

Other impacted taxing districts, like Wenatchee Valley Fire District and NCW Libraries, would need to create their own agreement with the Port.