Drain the thawed spinach. Place on a kitchen towel, roll up the towel and wring out the excess liquid. On another dry towel, spread out the spinach, breaking up any clumps and let dry while mixing the other ingredients.
In a large bowl, add the mayonnaise, sour cream, garlic, chives, onion powder, salt, pepper and paprika. Whisk until combined.
Add the red pepper and water chestnuts. Stir,
Add the spinach and stir until well combined.
Cover and refrigerate for at least 1 hour to let the flavors blend.
*If dip is too thick, add milk 1 tablespoon at a time while stirring to thin it out.* Cook time is the chilling time in the refrigerator.