Still No Handshake Regarding TIF Agreement Between Port & Chelan County

It's been over two months since Chelan County and the Port of Chelan County agreed in principle to settle a dispute over the Port's desire to create a tax increment financing (TIF) district in the Malaga area.

"I wouldn't call it a handshake at this point," explains Chelan County Commissioner Shon Smith. " I would say our hand is extended and ready to embrace that shake, but at this point we offered a final draft of the inter-local agreement that they offered to us that would change the parameters of how revenues from the TIF are dispersed throughout the county and to the junior taxing districts. That was in order to make all the parties whole and still give the Port the ability to use the additional money that will be coming in from the improvements that will be happening in the Malaga area over the next twenty-five years."

The clash between the two parties began early last summer, after the Port announced its intentions of creating the $154 million TIF to benefit its mission for local and regional economic expansion.

The County countered the Port's move by enacting a six-month moratorium on any and all TIFs within the unincorporated areas of its jurisdiction lines in late July. And multiple agency's - such as the Wenatchee Valley Fire Department, followed suit by supporting the County's move, with each citing concerns over the potential for massive revenue losses that might hinder their ability to properly address required maintenance and upgrades connected to increased service demands over the TIF's proposed 25-year lifespan.

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In November, a judge in neighboring Douglas County issued a preliminary injunction against Chelan County's moratorium, and the Port subsequently voted to officially sanction its pursuit of the TIF in late December.

Several days later, however, in an effort to settle the matter in good faith and avoid any potential legal actions by the County, the Port informally agreed to ratify its plans for the TIF by allowing the County to retain a portion of the revenues it generates in exchange for an annulment of the moratorium and the withdrawal of certain public records requests.

The tentative arrangement also called for the Port to drop its pending litigation against the County related to the issue, and for the County not to file any new challenges against the TIF once it has been enacted under the two party's mutually-agreed-upon terms.

Fast forward nine weeks into the new year, and Smith says the deal is still not officially done.

"We (County) offered them (Port) our wet signatures on the final draft that they submitted to us back in December and we have not heard back yet."

Smith believes it's not the Port's objection to any of the conditions or the semantics contained in the compact that are holding things up, but rather a new rush of legal pressures which are being applied to the Port by additional agencies.

"I think some of their hesitance is predicated on the fact that Douglas County, Wenatchee (Valley) Fire (Department), and Chelan County jointly filed a lawsuit against the Port in questioning a few things like a ballot measure and the TIF in general. I think that kind of caught them off guard and they have turned around and said 'why would you be offering us a handshake if now, all of the sudden, you're suing us'.

Smith admits that the provisions of the agreement do call for the County to cease all past and current litigation against the Port, which is something he says the County is prepared to do if the Port agrees to comply with its outlined terms.

He adds, however, that what any of the other entities who have taken up a legal posture against the Port will do, is out of the County's control.

"We can't control Douglas County's desires nor can we control Wenatchee Valley Fire (Department)'s desires. So, if they choose to drop their suits as well and receive the same inter-local agreement that the Port offered us, then that would be up to them. But we would withdraw our legal action in light of the agreement."

Despite the lingering state of an apparent resolution between the two sides, Smith says the County's legal challenge related to its moratorium remains ongoing.

"We have our appeal in review right now with the courts in Spokane to see if our moratorium on all TIFs in the unincorporated areas of Chelan County would have a six-month stay."

Although the County has yet to receive an ultimate decision about the legal validity of its moratorium, it did take the action of extending the moratorium for an additional six months earlier this year as it waits to receive a decision from the courts.

"We're kind of in a holding pattern right now," explains Smith. "The ball is definitely in the Port's court. It was a very good offer that we both agreed on, but I think it shocked them that a lawsuit was filed which included us (County) which questioned some of the things the Port has been doing lately."

Smith clarified that the lawsuit in question was not filed by Chelan County but rather, by Douglas County, although he says Chelan County was named in the action due to it also being potentially impacted by the proposed TIF.