Preheat your oven to 350°F and lightly grease a 9x13 inch baking dish. While the oven heats, cook the bacon in a skillet over medium-high heat until crispy, then crumble it and set aside. Dice the jalapeños (remove seeds for less heat if preferred), shred the cooked chicken if not already done, grate the cheddar cheese freshly, and have all remaining ingredients measured and ready. This preparation ensures smooth cooking once you begin the sauce.
Bring a large pot of salted water to a boil and cook the farfalle until just firm (al dente), then drain and rinse lightly with cool water to stop cooking. While the pasta cooks, begin your sauce: melt the butter in a separate saucepan over medium heat, sprinkle in the flour, and whisk constantly for 1-2 minutes to create a roux, which will thicken your sauce. This timing allows both components to finish around the same time, maximizing efficiency.
Gradually whisk the chicken broth and milk into your roux, stirring constantly to avoid lumps, then increase heat to medium-high and bring to a gentle boil, stirring frequently until the sauce thickens enough to coat the back of a spoon (about 3-5 minutes). Once thickened, reduce heat to low and add the softened cream cheese in chunks, stirring gently until completely melted and smooth. I find that keeping the heat low when adding cream cheese prevents it from becoming grainy or separating.
Remove the sauce from heat and stir in the Monterey Jack cheese until completely melted and smooth. Add the salt, garlic powder, and smoked paprika, stirring well to distribute the seasonings evenly. Now fold in the cooked pasta from Step 2, shredded chicken, diced jalapeños, and most of the crumbled bacon (reserve some for topping), mixing gently but thoroughly to ensure everything is coated with the creamy sauce.
Pour the entire mixture into your prepared baking dish and spread evenly. Top with the freshly grated cheddar cheese, reserving a small handful, and scatter the reserved crumbled bacon and extra diced jalapeños over the top for added flavor and visual appeal. Cover the dish tightly with foil to retain moisture and prevent the cheese topping from browning too quickly.
Bake the covered casserole at 350°F for 20 minutes, then remove the foil and bake for an additional 5-10 minutes until the cheese topping is melted and lightly golden. For extra browning and a slightly crispy cheese top, I like to finish it under the broiler for 1-2 minutes, watching carefully to prevent burning. Let the casserole rest for 5-10 minutes before serving—this allows the sauce to set slightly and makes it easier to portion.