Wenatchee Fire Officials Warn Malaga TIF Plan Risks $52 Million Loss

The Wenatchee Valley Fire Department is asking the Chelan-Douglas Regional Port Authority to revise the proposed Malaga Tax Increment Finance (TIF) area, warning that the current plan could significantly reduce funding needed for fire and emergency services.

Microsoft Parcel at Center of Dispute

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The proposed TIF, encompassing roughly 3,326 acres, includes 3,229 acres of underdeveloped land and a 97-acre Microsoft-owned parcel. The fire department supports the inclusion of the undeveloped land, saying it aligns with the legislative intent of Washington’s TIF law—stimulating growth in areas that otherwise would not develop.

READ MORE: Injunction Issued Against Chelan County Moratorium on Malaga TIF

Concerns Over Compliance With State Law

However, fire officials argue that including already-developed or permitted properties, such as the Microsoft parcel, violates RCW 39.114.020(j), which limits TIF areas to places where private development “would not reasonably be expected to occur” without TIF-funded infrastructure. The department said revenue from Microsoft’s data center in Malaga was already factored into staffing and operations at the nearby fire station.

Microsoft is currently funding one-third of the firefighters there through a three-year partnership, with the expectation that tax revenue from its property would sustain those positions once the agreement ends. Under the proposed TIF, that anticipated revenue would instead go to the Port of Chelan County for 25 years.

Fire Department Warns of $52 Million Funding Loss

Citing Microsoft’s existing data center in Douglas County as an example, the department estimates it could lose about $369,694 in annual revenue from the Malaga property, with a projected total of more than $52 million diverted over the 25-year TIF term.

“This is real money diversion from the fire department, not speculative incremental value,” said Fire Chief Brian Brett.

The agency said it is currently 33% understaffed and receives only 31% staffing credit from the insurance industry. While acknowledging that new development brings long-term benefits, the fire department said the 25-year delay in accessing full tax revenues presents “a significant challenge.”

Request to Revise the Malaga TIF Boundary

It also expressed concern that offsetting the loss by raising taxes across the rest of the district would unfairly burden the community.

The department requested that the Chelan-Douglas Regional Port Authority remove existing and already-permitted developments from the proposed Malaga TIF boundary, bringing the plan into compliance with state law and ensuring it focuses on stimulating new infrastructure and growth.