Step 1

Melt butter in a small skillet over medium-low heat.

Step 2

Add shallot, jalapeno, garlic, chili powder, salt, and pepper. Cook, stirring occasionally until slightly softened, about 3 minutes.

Step 3

Add flour and stir constantly for 1 minute.

Step 4

Add ¼ cup of milk and cream cheese. Whisking constantly, cook until thickened and smooth, about 2 minutes.

Step 5

Slowly whisk in remaining ¼ cup milk and cook until combined and starting to steam.

Step 6

Remove from heat, and add in shredded cheese. Whisk constantly until the cheese is melted, about 4 minutes.

Step 7

Stir in tomatoes and cilantro and serve immediately with chips!