by Jonathan Eberle | May 9, 2025 | News
By Jonathan Eberle |
A bill aimed at increasing transparency and accountability in Arizona’s Medicaid contracting process has been vetoed by Governor Katie Hobbs, prompting strong criticism from Republican lawmakers who say the governor is shielding her administration from scrutiny.
The legislation, SB 1612, was sponsored by Senate President Pro Tempore T.J. Shope and would have implemented a series of oversight measures affecting how the Arizona Health Care Cost Containment System (AHCCCS) — the state’s Medicaid agency — awards contracts and handles procurement.
In a statement released late Friday, Hobbs vetoed the bill without an accompanying public explanation, though her office has generally opposed what it characterizes as politically motivated legislation. Shope, however, called the veto “an alarming example of the fox guarding the henhouse.”
“I drafted this legislation in response to potential wrongdoing revealed from a probe on how the Hobbs administration provided an unfair advantage when awarding $15 billion worth of state Medicaid contracts,” Shope said. “She appears to be providing favoritism to her friends, allies, and donors using taxpayer dollars.”
The legislation comes in the wake of a 2023 ruling by an administrative law judge that found AHCCCS had improperly awarded contracts related to the Arizona Long Term Care System (ALTCS), which provides care for roughly 26,000 elderly and disabled Arizonans. The judge cited violations of procurement statutes, flawed bid evaluations, and evidence that contract decisions were made based on the interests of the agency rather than the public. Compounding concerns, a June 2023 local media investigation revealed that Sunshine Residential Homes, a state-licensed group home with a record of deficiencies, received millions in contracts from the Arizona Department of Child Safety (DCS) after making campaign donations to Governor Hobbs and the Arizona Democratic Party.
SB 1612 would have removed a statutory exemption allowing AHCCCS to use its own procurement code, requiring adherence to statewide rules; prohibited destruction of internal documentation during request-for-proposal (RFP) evaluations; and required vendors responding to RFPs or applying for state-administered grants to disclose political donations made to the governor or associated campaign committees.
Critics of Hobbs say these measures were a direct response to growing concerns about transparency in her administration. “Had she signed this bill into law, she would have given the citizens of Arizona greater confidence in state government acting in their best interests — not the best interests of political campaign coffers,” Shope said.
Hobbs’ veto is one of more than 100 since taking office in 2023. With Republicans controlling both chambers of the Arizona Legislature and Democrats holding the governorship, partisan tensions over issues like procurement, immigration, and education have dominated the political landscape.
Supporters of SB 1612 say it was a common-sense effort to address documented problems in contract awards that affect the lives of thousands of vulnerable Arizonans. As scrutiny intensifies over both AHCCCS and DCS procurement decisions, it remains to be seen whether lawmakers will revisit the bill in another form or pursue an independent investigation into the allegations.
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
by Jonathan Eberle | May 8, 2025 | News
By Jonathan Eberle |
Arizona Governor Katie Hobbs has vetoed a Republican-sponsored immigration enforcement bill, drawing sharp criticism from Senator John Kavanagh and other GOP lawmakers who say the legislation was a necessary step toward protecting public safety.
SB 1610, introduced by Kavanagh, would have required county detention facilities to cooperate with federal immigration authorities by providing U.S. Immigration and Customs Enforcement (ICE) with access to information about non-citizen individuals arrested for certain serious crimes, including aggravated assault on a law enforcement officer, burglary, and offenses resulting in serious bodily injury or death.
Governor Hobbs vetoed the bill, saying it would have undermined trust between immigrant communities and law enforcement and could have led to racial profiling. Hobbs has previously said that Arizona should not be in the business of enforcing federal immigration law — a view aligned with many Democrats who argue that local entanglement in immigration enforcement can have unintended legal and social consequences.
Senator Kavanagh sharply disagreed, framing the veto as a dereliction of duty.
“Hobbs continues to give her veto stamp more attention than the citizens she’s required to protect,” Kavanagh said in a statement. “People are fed up with the massive tsunami of dangerous criminals who have entered this country illegally.”
He added that the bill was a way to align Arizona with federal deportation efforts and referenced the recent Laken Riley Act, a congressional proposal with bipartisan support that also centers on deportation of illegal immigrants convicted of violent crimes.
The bill comes at a time when immigration remains a political issue in Arizona, a border state that has long wrestled with foreign nationals attempting to enter illegally into the U.S. Republican lawmakers have increasingly advocated for state-level legislation to fill what they see as gaps in federal immigration enforcement. Democrats, however, claim that such bills often cast too wide a net and risk violating constitutional protections.
Governor Hobbs has issued more than 100 vetoes since taking office in 2023 — a record-setting pace that reflects the divided government in Arizona, where Republicans control the Legislature and Democrats hold the governor’s office.
With the latest veto, the clash between state lawmakers and the governor over immigration policy is likely to continue into the next legislative session and could become a focal point in upcoming elections.
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
by Staff Reporter | May 6, 2025 | News
By Staff Reporter |
Under the direction of Governor Katie Hobbs, the Arizona Department of Administration (ADA) sold the state’s first private prison rather than repurposing it for illegal alien detainment.
The State House overwhelmingly rejected a bill last Thursday to lease the prison, Marana Community Correctional Treatment Facility adjacent to Tucson, to the federal government for illegal aliens and other violators of immigration law for just $1 a year. The bill failed due to bipartisan rejection despite its party-line passage in the Senate.
“The federal government should have access to the empty Marana Prison to house these dangerous criminal illegal aliens so that Arizonans are protected from further threats,” said the bill’s author, Senator John Kavanaugh.
One Republican lawmaker representing Marana, Rep. Rachel Keshel, rejected repurposing the prison for immigration violations over concerns of bringing criminal illegal aliens into their community.
Keshel and fellow lawmaker to the area, Democratic Rep. Kevin Volk, alleged in remarks to Capitol Media Services that Kavanaugh failed to consult with local leaders about his proposed plan.
“Now, I do agree that something needs to happen with it instead of it just sitting there. But why was I not consulted with?” Keshel asked. “Why wasn’t I able to go to the mayor, the vice mayor, the town council of Marana, and figure out what their desires were for their community?”
The prison’s buyer, Management and Training Corporation (MTC) out of Utah, had operated and managed the prison. MTC purchased the 500-bed facility for about $15 million last Wednesday.
MTC owns nearly 40 correctional facilities, community release centers, and treatment programs across the nation.
The Marana prison was the state’s first private prison, established over 30 years ago. The minimum-security facility housed around up to 500 prisoners requiring substance abuse intervention. The declining prison population in the state prompted the prison’s closing and its recent sale.
The sale comes less than two years after Governor Katie Hobbs announced the prison’s closure in late 2023. The prison closed with under half of the number of prisoners that would constitute capacity.
Hobbs said the closure was a means of saving taxpayer dollars and eliminating government waste. The governor projected a savings of $15 million between the 2024 and 2025 fiscal years.
Arizona Department of Corrections Rehabilitation and Reentry (ADCRR) absorbed the Marana inmates into other prisons throughout the state. ADCRR operates 15 prisons, six of which are private.
“So not only are we demonstrating significant savings, we’re demonstrating, with actions, our ability to be more efficient with the resources already provided to us,” said ADCRR Director Ryan Thornell.
The move by the Hobbs administration put off some local leaders. Marana Mayor Ed Honea said Hobbs gave notice to nearly 90 prison employees and staff of their impending job loss just three weeks before Christmas. The prison had the capability of employing over 200 individuals at full capacity.
Per Honea, the Marana inmates also provided affordable labor for the town. The inmates managed and cleared roadways, and during storm seasons would also clear debris.
AZ Free News is your #1 source for Arizona news and politics. You can send us news tips using this link.
by Jonathan Eberle | May 3, 2025 | News
By Jonathan Eberle |
Arizona Governor Katie Hobbs announced Wednesday that two of her top health officials, AHCCCS Director Carmen Heredia and Department of Health Services Director Jennie Cunico, have resigned after it became apparent that the Republican-controlled state Senate would not confirm their appointments.
The resignations come amid a broader struggle between the governor’s office and the state Senate’s Director Nominations Committee, chaired by Republican Senator Jake Hoffman. The committee has become increasingly assertive in vetting Hobbs’ executive agency nominees, and in recent weeks signaled it would reject both Heredia and Cunico. Hobbs’ office said the resignations were necessary due to the Senate Majority’s unwillingness to confirm them.
“Today’s announcement is a testament to the important work being conducted on behalf of the citizens of Arizona by the Senate Committee on Director Nominations. I’m pleased Katie Hobbs saved herself, and AHCCCS Director Nominee Carmen Heredia, from the embarrassment of advancing her through the scheduled hearing this week,” said Senate Director Nominations Committee Chair Jake Hoffman. “Under Heredia’s direction, AHCCCS mismanaged the procurement process and improperly awarded contracts for healthcare services for thousands of elderly and physically disabled individuals enrolled in the Arizona Long Term Care System. A judge described the process as ‘arbitrary and capricious’ and recommended a full reset. Instead of responding to the feedback appropriately, Heredia basically told the judicial system to pound sand and moved forward with the contracts. Her refusal to provide transparency in this matter displayed nothing more than arrogance.”
“What’s even worse, Arizona is in the middle of a monumental Medicaid fraud crisis with a loss of more than $2 billion in taxpayer dollars,” continued Hoffman. “Under Katie Hobbs’ leadership, Heredia’s response has been incredibly disturbing, to say the least. Patients in sober living homes were evicted from facilities overnight after AHCCCS poorly executed suspensions of more than 300 providers. Many of these patients were mid-treatment, detoxing, or severely mentally ill and were dropped off on the streets with no identification or transportation. Legitimate providers were caught up in the mess without AHCCCS providing explanations or due process. Some are still waiting to be reinstated or reimbursed. We are left with a broken system due to Heredia’s mismanagement, and our vulnerable populations are caught up in this collapse.”
“Since its inception, the Committee on Director Nominations has been committed to honestly, thoroughly, and accurately vetting Katie Hobbs’ nominees. We have served as Arizonans’ last line of defense against incompetent, unqualified, and highly partisan picks to lead state agencies. We will continue to do the hard work the citizens of Arizona expect of us and will only approve competent, non-partisan individuals to serve in these critical roles,” stated Hoffman. “We look forward to Katie Hobbs sending us a sensible leader that will be able to rein in the abuse that has occurred at AHCCCS.”
Heredia, who led the Arizona Health Care Cost Containment System (AHCCCS) since early 2023, was credited by Hobbs with implementing sweeping reforms that led to nearly $1 billion in Medicaid fraud recoveries and savings over three years. She expanded access to care for working-class children, oversaw transitions to employer-sponsored insurance, and spearheaded behavioral health initiatives such as the Housing and Health Opportunities program.
However, Heredia’s leadership was the subject of fierce criticism from Senate Republicans. Senator Hoffman accused her of mismanaging Medicaid contracts and overseeing what he called a “broken system” during Arizona’s recent Medicaid fraud crisis. The Senate committee never formally held a confirmation hearing for Heredia, but it became clear she lacked the votes needed.
In her resignation letter, Heredia said, “It has become increasingly difficult to carry out this mission in good faith under the current political climate… Political theater has begun to outweigh sound policy.”
Cunico, a career public servant who transitioned from the Ducey administration also became ensnared in the Senate’s broader dispute over executive appointments. “It is clear to me that there is no path forward to confirmation,” Cunico said in her statement.
The latest resignations reflect a deepening power struggle between the Democratic governor and the Republican-led Legislature. Hobbs condemned what she called an “unprecedented politicization” of the confirmation process, warning that the climate in the Capitol is deterring qualified public servants.
“These resignations were not due to a failure in governance, but a failure in politics,” Hobbs said. “The people of Arizona deserve leaders who are judged by their performance, not their party.”
As the governor seeks replacements for both roles, it remains unclear how future nominees will fare in a process increasingly shaped by ideological divisions.
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
by Staff Reporter | Apr 30, 2025 | News
By Staff Reporter |
The Arizona Republican Party’s former treasurer and GOP candidate for the 2026 state treasurer’s race warned lawmakers against Governor Hobbs’ nominee for the Arizona Department of Insurance and Financial Institutions (DIFI).
In a letter to Arizona state senators, state treasurer candidate Elijah Norton said that Hobbs’ DIFI nominee, Barbara Richardson, not only displayed troubling behavior during her two Director Nominations (DINO) committee hearings but had a poor performance record as director of DIFI. Norton owns multiple insurance and insurance-related businesses regulated by DIFI — some of which he says have been targeted by Richardson in the past.
Norton alleged that Richardson retaliated against him for testifying before DINO against her by asking the agency she formerly led — the Nevada Department of Insurance (NDI) — to investigate him. Norton said that one week after his DINO testimony, his company received an email from NDI demanding an National Association of Insurance Commissioners (NAIC) biographical affidavit.
“I believe that Ms. Richardson contacted a mid-level sympathetic bureaucrat in her old office and asked them to do this in retaliation for the well-documented part I played in bringing several issues to light that resulted in her failing the DINO confirmation vote,” said Norton.
Norton further attested that one day after he went public to Arizona lawmakers and political leaders about the NDI request he believed was prompted by Richardson, NDI called him to retract their request and ask instead for his Social Security number — information which NDI has had on file for over a decade, per Norton.
“The person on the phone sounded very nervous, and it appeared to me they were trying to ‘cover their tracks,’” said Norton.
According to Norton, this retaliation wasn’t new to him — or others. Norton also alleged Richardson targeted not only him but Barry Goldwater Jr. (son of late Senator Barry Goldwater) in the past with “regulatory retaliation.” According to Norton, Richardson banned him from calling the NDI while she was the Nevada Insurance Commissioner because he challenged a certain regulation. Goldwater Jr. allegedly faced similar problems after he voiced his opposition to Richardson to Arizona Senate leadership.
“[I] pushed back on a ridiculous minor change on a form that was going to cost my company over $10,000 and over 100 hours of time due to one of her unreasonable bureaucrats wanting me to underline one immaterial sentence — that would require me resubmitting the form to all of the various states. The requested change wasn’t even contained in the statute, rather the bureaucrat relied on the ‘promulgation clause’ (resembling the way she abused SERFF in Arizona),” stated Norton. “She retaliated by sending me a letter saying I was ‘banned’ from calling the Nevada DOI (despite paying them over $1,000 per year in regulatory fees), simply because I pushed back against an unreasonable regulation – violating my constitutional rights. This is the only time in my entire career this has occurred before and since.”
Norton also alleged Nevada lost its NAIC accreditation under Richardson, but available records reflect the state maintained its accreditation.
Norton also revisited key points of concern raised by Republican lawmakers over Richardson’s time as DIFI director during the first DINO hearing last month. Hobbs appointed Richardson to the DIFI position in March 2023.
In the first DINO hearing, Richardson was questioned about her service as chairwoman to a NAIC committee which considered variable insurance pricing based on race. The committee dissolved a day before her first DINO hearing last month.
That first hearing also revealed that, under Richardson’s directorship, System for Electronic Rate and Form Filing (SERFF) abuse occurred, significant increases to licensing times piled on, and services rendered decreased continually — of note, DIFI was found to have restricted its licensing hotline to voicemail only at certain times under Richardson’s tenure.
AZ Free News is your #1 source for Arizona news and politics. You can send us news tips using this link.
