Port advances 50/50 revenue-sharing proposal as court again rejects County challenge to Malaga TIA

WENATCHEE — Port of Chelan County Commissioners on Tuesday directed Chelan Douglas Regional Port Authority CEO Jim Kuntz — who answers directly to the Port Commission — to begin negotiating a revenue-sharing agreement with taxing districts affected by the proposed Malaga Tax Increment Area. The directive came during the Port’s Dec. 9 meeting.

The Port also moved its vote on establishing the Malaga TIA to Dec. 23 at 9 a.m. at the Confluence Technology Center.

50/50 split proposal and broader economic vision

The Port’s proposal would divide the property-tax increment from Microsoft’s first three data-center buildings equally; half would go to the TIA, and half to the impacted taxing districts. Commissioners said the proposed boundary and project list remain unchanged.

They also signaled an intention to prioritize Malaga sewer infrastructure as an early TIA investment, following discussions with Chelan County and the Malaga Water District regarding rising nitrate levels in local drinking water.

The Port’s long-term framing extends beyond immediate utility needs. Infrastructure improvements in Malaga — particularly those that could eventually support new employers at or near the former Alcoa property — are expected to expand the countywide tax base over time. As new businesses come online and valuation grows, increased commercial revenue could strengthen funding for public services across Chelan County and help reduce the need for additional tax increases for residents. Port leaders have repeatedly emphasized that strategic investment in one corner of the county can produce benefits far beyond the TIA boundary.

Port Commissioner Donn Etherington said the revenue-sharing concept reflects the testimony gathered over four public hearings and subsequent meetings with taxing districts, and that commissioners intend the model to balance infrastructure needs with concerns about impacts on existing services.

Court again affirms the Port’s legal standing

The Port’s action came the same day Douglas County Superior Court issued two rulings that together reaffirm the Port’s authority to continue pursuing a TIA under RCW 39.114.

In a Dec. 9 order, the Court denied Chelan County’s motion for reconsideration and left the Oct. 29 preliminary injunction fully in effect.

A companion letter from Judge Brian Huber addressed specific claims raised by the County, including the assertion that the Court had effectively given the Port a “judicial stamp of approval” to designate a TIA prematurely. The judge rejected that characterization, noting that the injunction does not waive or relax any statutory requirements and does not speak to the merits or wisdom of approving a TIA. He also declined the County’s request for an evidentiary hearing, finding no disputed facts material to the legal issues.

A conciliatory move shaped by public input

With the injunction upheld and the legal framework unchanged, the Port remains on firm footing as it approaches its Dec. 23 vote. Against that backdrop, the 50/50 revenue-sharing proposal stands out as the Port’s most significant attempt yet to ease tensions with other taxing districts. Commissioners have framed the move as both a response to public testimony and a commitment to building long-term partnerships as Malaga grows.

By offering a shared-revenue model before the final vote, the Port is signaling that even in a position of legal strength, it is choosing collaboration and predictability. The proposal reflects a broader vision for Malaga’s future — one in which infrastructure investment helps attract employers, expands the tax base, and ultimately supports services and residents throughout Chelan County.

Andrew Simpson: 509-433-7626 or andrew@ward.media