Arizona Gov. Katie Hobbs responds to ‘pay-for-play’ allegations: ‘It is outrageous’

PHOENIX – Arizona Gov. Katie Hobbs said Tuesday it was “outrageous” she was being accused of a “pay-for-play” scheme allegedly involving a Democratic donor that operates state-contracted group homes.

The Arizona Attorney General’s Office said last week it was launching an investigation in the wake of Arizona Republic reporting about ties between Hobbs and Sunshine Residential Homes.

“I’m a social worker, and it is outrageous that I would not act in the best interest of Arizona’s children in foster care. I have always and will always do what is best for Arizonans,” Hobbs told reporters at a Phoenix event promoting a high school civics program.

“There is an AG investigation. I’m not going to comment further except to say that I look forward to the conclusion of the investigation and finding that we acted in the best interest of Arizona.”

Where did ‘pay-for-play’ allegations come from?

Sunshine, a private company contracted by the state Department of Child Safety (DCS) to shelter neglected and abused children, made donations totaling $400,000 to Hobbs’ inauguration committee and the Arizona Democratic Party in 2022 and 2023, both before and after Hobbs was elected, the Republic reported.

DCS has approved significant rate hikes requested by the group home operator since Hobbs took office, according to the state’s largest newspaper, raising questions about preferential treatment.

Attorney General Kris Mayes, a Democrat, is investigating the matter after Republican state Sen. T.J. Shope asked her to look into what he said “can only be described as a pay-for-play scheme.”

Shope also reached out last week to Maricopa County Attorney Rachel Mitchell, a Republican, about a potential investigation, as did GOP state Rep. Matt Gress.

Mitchell said the Auditor General’s Office had contacted her about working together on the case, which prompted Mayes to tell the other agencies to back down.

Mayes wrote letters to the Arizona Auditor General’s Office and Maricopa County Attorney’s Office telling them it would be inappropriate “to conduct parallel investigations.”

Hobbs said “yes” when asked Tuesday if she thought Mayes would conduct the investigation fairly.

She was then asked if she thought Mitchell would do a fair job.

“I’m not going to comment on something that isn’t happening at this moment,” the governor said.

Treasurer Kimberly Yee weighs in on investigation

Some Republicans have questioned whether Mayes can be impartial, notably Treasurer Kimberly Yee, who wrote a letter to Mayes disputing the notion that the AG’s Office should have sole jurisdiction over the investigation.

“First, such an assertion is not appropriate or authorized by law, as those entities have separate jurisdiction to investigate this matter,” Yee wrote Monday.

Citing “potential ethical conflict of interest” and “other relationships with the officials that may have been involved in the alleged scheme,” Yee suggested Mayes should transfer the investigation to Mitchell or another county attorney.

Mayes responded to Yee on Monday with a letter disputing the treasurer’s assessment.

“As with any other investigation our office conducts, we will follow the facts wherever they lead us. As with everything else we do, we are also fully cognizant of our ethical obligations and have taken appropriate measures to protect the interests of all concerned, including directing the Department of Child Safety to obtain outside counsel in this matter,” Mayes wrote to Yee.

“Finally, I will note that while you are certainly always welcome to express your personal concerns to me, nothing about the matters Sen. Shope has asked us to investigate are remotely related to any of your statutory duties as set out by A.R.S. §41-172.”

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