Judge grants injunction allowing Port to proceed with Malaga TIF steps

WATERVILLE — A Douglas County Superior Court judge on Tuesday granted the Port of Chelan County's request for an injunction blocking Chelan County from enforcing its moratorium on tax-increment financing (TIF) in unincorporated areas — a swift ruling that cleared the way for the Port to continue statutory steps toward designating a tax-increment area in Malaga.

Judge Brian Huber delivered the decision immediately after hearing arguments from both sides, calling the case “simple” despite its layers of statutory and procedural complexity. The ruling, which took only as long as it took him to speak it, sharply underscored the court’s view that the County had overstepped its authority.

Before the hearing began, Chelan County Commissioner Brad Hawkins remarked that he expected the session to be limited to arguments, not a ruling — a reflection of how differently the County and the Port have interpreted the reach of their respective powers under state law. Judge Huber’s rapid decision made clear which interpretation the court found convincing.

Huber ruled that the Port demonstrated a clear legal right under the state’s TIF statute, RCW 39.114, to move forward with its procedural steps, and that the County’s moratorium “causes a present invasion” of that right and threatens both statutory-function and revenue-stream injury. He signed the Port’s proposed order granting a preliminary injunction, restraining the County from applying its moratorium to the Port’s planned Malaga TIF district.

Representing the Port, attorney Quentin Batjer argued that the County had used a land-use moratorium under the Growth Management Act to veto a finance statute under the TIF Act, creating a conflict between two legislative frameworks meant to run in parallel. Batjer said the Port’s request was narrow — to preserve its ability to hold two public briefings and a December 9 designation vote while leaving all land-use authority intact with the County. He described the situation as “two lanes” of authority: Finance for the Port, land use for the County.

Chelan County’s attorney, Rachel Constantino-Wallace, defended the moratorium as a legitimate planning tool under the Growth Management Act (RCW 36.70A). She argued that moratoriums are designed to preserve the status quo while the County updates its comprehensive plan, and that the Port had not shown “actual and substantial injury.” Constantino-Wallace said injunctions are “extraordinary remedies that should not be lightly indulged in” and contended that no irreparable harm would occur before the Port’s December vote.

Huber disagreed, describing the Port and County as “co-equal entities” with separate statutory mandates. Reading from the County’s own moratorium, he said its language made the intent plain: “It seems pretty clear that Chelan County’s intent was to seek to prohibit a local government entity other than Chelan County from creating and designating any increment area in unincorporated areas of Chelan County.” He added that the law requires courts to harmonize state statutes “rather than pit them against each other.”

“I haven’t heard a good argument other than that,” Huber said from the bench. “If there were an organizational chart, I’m not convinced the County is above the Port such that it can veto statutory functions the Port seems to be [allowed to carry out].”

The injunction enjoins Chelan County from enforcing its moratorium “as applied to the Port’s designation of a tax-increment area,” including by refusing to accept required statutory notices or coordinate interagency steps. It explicitly preserves the County’s authority to administer and enforce land-use codes and permitting for any specific development applications.

Constantino-Wallace asked the court to consider a narrower injunction that would allow the Port to hold informational briefings but delay final designation until a later hearing. Huber declined, saying that approach “would only tend to exacerbate” the harm already found. He invited the County to file a supplemental briefing or a motion for reconsideration if it wishes to propose alternative language.

The injunction remains in effect while the underlying lawsuit continues. The Port’s first public TIF briefing is scheduled for November 18, followed by a second briefing and a potential December 9 vote on designation.

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