Cook potatoes in boiling water to cover in a large saucepan 20 minutes or until tender; drain. Cool and cut into thin slices; set aside.
Melt butter in a saucepan over low heat; whisk in flour until smooth. Cook, whisking constantly, 1 minute. Gradually whisk in milk; cook over medium heat, whisking constantly, until mixture is slightly thickened and bubbly. Remove mixture from heat; add cheese and next 3 ingredients, stirring until cheese melts.
Layer potato slices, pimiento, and bell pepper in a lightly greased 8-inch square baking dish; top evenly with cheese mixture.
Bake at 350° for 30 minutes.