State Treasurer’s report points out flaws, inadequacies of port-proposed TIA
Report repeatedly recommends more work with impacted taxing districts before approving TIA
In a report released last week, the Washington State Treasurer’s Office (STO) encourages the Chelan-Douglas Regional Port Authority to revise its proposal to create a tax increment area (TIA) in Malaga and to work more closely with the impacted taxing districts before moving forward on its plans.
Chelan County commissioners believe the state’s recommendations are another clear sign it’s time the regional port put aside its TIA as it is proposed and go back to the drawing board with its partners and the community.
“This board has asked the port to slow down and partner with us. The public has asked its port to put aside the proposed TIA. And now the state is asking the regional port to make revisions,” Chelan County Commissioner Shon Smith said. “If port commissioners move forward on Dec. 9 by voting in favor of this TIA, they are sending a clear message to the community and the state that they are willingly ignoring everyone’s concerns. The TIA, as proposed now, is a money grab, not a well-thought-out plan to better our community together.”
The regional port proposes forming a 3,326-acre TIA in an area that is seeing the fastest-growing development in the county’s history, diverting some $195.7 million from local taxing districts directly to the regional port over 25 years. The local taxing districts contend that taking millions of dollars from their budgets jeopardizes vital services and may force them to seek additional taxes, measures that will directly impact residents.
The comments from STO are included in its review of the regional port’s draft project analysis. The review was released on Nov. 13 to the regional port and Chelan County. It is available online.
State law requires the STO to provide the regional port any comments regarding suggested revisions or enhancements to its project analysis. The STO makes sure the draft proposal “adequately discloses potential risks that might result from the implementation of the project,” according to the report.
In its review, the STO questions whether the regional port has sufficient basis for its “But For” finding, which states that future, private development would not reasonably be expected to occur through private investment within the reasonably foreseeable future but for the proposed public improvements.
“After bond proceeds and cash funding, the Port projects that $86.0 million, or 43% of the $198.6 million of total public improvements will remain unfunded,” the report states. “Having such a significant amount of unfunded public improvements weakens the Port’s argument that future private development projects would not be reasonably expected to occur solely through private investment, known as the ‘But For’ finding.”
Chelan County Commissioner Brad Hawkins emphasized that the STO report points out how incomplete the port’s proposal is and questions whether it is even valid under state law.
“I have long stated that the port’s proposal is both a misuse and an abuse of the TIA law, as intended, which we believe the State Treasurer is now suggesting,” Hawkins said. “It’s time for the regional port to push pause on this idea, cancel any scheduled action on Dec. 9 and engage community stakeholders in a multi-month collaborative process to see if a TIF even makes sense in Malaga. That’s the only way I believe the port can minimize the negative impacts and salvage what’s left of its relationships with local governments.”
Among the other comments from the STO:
- We encourage the Port to revise its project analysis to better describe the priority and construction timeline for the public improvements, how it will make up the $86 million funding gap, and specifically how each public improvement will encourage private development, other than the already expected data center projects. Without further explanation, the cumulative impact of these omissions is an incomplete plan of finance, making it unclear whether the Port has a sufficient basis for its “But For” finding. (Page 4 of the report)
- Project Costs Relative to Identified Funding Sources: The project analysis did not specify the priority or construction timeline for the identified public improvements. The project analysis also did not identify how the Port would fund 43% of the $198.6 million of identified public improvements. Without further explanation, the cumulative impact of these omissions is an incomplete plan of finance, making it unclear whether the Port has sufficient basis for its “But For” finding. (Page 14 of the report)
- Prior to approving the TIA, we recommend the Port coordinate closely with the impacted taxing districts to ensure that all parties have an accurate understanding of how the TIA will impact them and to provide sufficient time to work through concerns and any appropriate mitigation. (Page 15 of the report)
- We recommend that the Port revise its project analysis to clearly describe the priority and construction timeline of the identified public improvements, as well as how the public improvements will facilitate future development and support the Port’s “But For” Finding. (Page 16 of the report)
The report was released just days before the regional port started holding public meetings on the TIA. One such meeting on Nov. 17 at Mission View Elementary School drew about 160 people and left little time for public comment. In about 30 minutes, only about a half dozen people were allowed to ask questions or make a statement.
“It was a one-sided presentation with several inaccuracies, including when the regional port CEO said – not once but twice – that no taxing districts would be harmed with a port-sponsored TIA,” Chelan County Commissioner Kevin Overbay said. “The county, our firefighters, the county road department and the library district have explained time and time again what these impacts will be on the people we all serve. When are the port commissioners going to listen?”
Chelan County commissioners encourage people to attend one of two public briefings left before the regional port takes a vote on its proposed TIA on Dec. 9. Both meetings are at 5 p.m. on Nov. 24 and Nov. 25 at the Confluence Technology Center in Wenatchee. Zoom options are also available for the meetings.
Last Updated: 11/20/2025 02:50 PM