Melt butter in a large saucepan over medium-low heat. Whisk in flour until smooth. Gradually whisk in the cream, milk, garlic powder, onion powder and paprika. Bring to a boil; cook and whisk for 2 minutes or until thickened.
Reduce heat to low. Gradually whisk in cheddar and colby until melted.
Remove from the heat. Stir in green chiles. Season with salt and pepper to taste. Add milk, a tablespoon at a time, until desired consistency. Serve with tortilla chips.
